CURTISS-WRIGHT CORPORATION
1200 Wall Street West, Lyndhurst, New Jersey 07071
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Curtiss-Wright Corporation:
Notice is hereby given that the Annual Meeting of Stockholders of
Curtiss-Wright Corporation, a Delaware corporation, will be held at the Novotel
Meadowlands Hotel, One Polito Avenue, Lyndhurst, New Jersey on Friday, May 5,
1995, at 2:00 p.m., for the following purposes:
(1) To elect six directors, each to hold office until the next Annual
Meeting of Stockholders and until his or her successor shall have been elected
and shall qualify;
(2) To consider and act upon a proposal to approve the Corporation's 1995
Long-Term Incentive Plan;
(3) To appoint independent accountants for the current year, Price
Waterhouse having been nominated as such by the Board of Directors; and
(4) To consider and transact such other business as may properly come
before the meeting.
Only holders of common stock of record at the close of business on March
10, 1995 are entitled to notice of and to vote at the meeting. A list of such
holders will be at the offices of the Corporation, 1200 Wall Street West,
Lyndhurst, N.J. 07071, during the ten days preceding the meeting date.
PLEASE FILL IN, SIGN AND PROMPTLY RETURN YOUR PROXY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE. Stockholders who plan to attend the meeting
in person are nevertheless requested to sign and return their proxies to make
certain that their stock will be represented at the meeting should they be
prevented unexpectedly from attending.
By Order of the Board of Directors,
Dana M. Taylor, Jr.
Secretary
March 13, 1995
- 1 - <PAGE>
<PAGE>
CURTISS-WRIGHT CORPORATION
1200 Wall Street West, Lyndhurst, New Jersey 07071
PROXY STATEMENT
This Proxy Statement is furnished by Curtiss-Wright Corporation
(hereinafter called the "Corporation" or the "Company") in connection with the
solicitation of proxies for use at the Annual Meeting of Stockholders to be
held at the time and place and for the purposes set forth in the foregoing
Notice of Annual Meeting of Stockholders. The Proxy Statement and accompanying
proxy will be first mailed to stockholders on or about March 17, 1995.
As of March 10, 1995, the record date for determining the holders of common
stock entitled to notice of and to vote at the Annual Meeting, there were
outstanding and entitled to vote at the Annual Meeting 5,059,053 shares of
common stock. Each share of stock is entitled to one vote.
The proxy card provides space for a shareholder to withhold voting for any
or all nominees for the Board of Directors, and to abstain from voting for the
appointment of independent accountants or for the Corporation's 1995 Long-Term
Incentive Plan if the shareholder chooses to do so. The election of directors
requires a plurality of the votes cast while the approval of the appointment of
independent accountants and of the Corporation's 1995 Long-Term Incentive Plan
both require the affirmative vote of a majority in interest of the stockholders
present in person or by proxy and entitled to vote. Abstentions and broker
non-votes are counted for purposes of determining whether a quorum is present
at the meeting. An abstention will be treated as a negative vote with respect
to each matter other than the election of directors as to which the shareholder
abstained. As to broker non-votes, if a broker indicates on the proxy that it
does not have discretionary authority to vote on a particular matter, those
shares will not be considered as present and entitled to vote with respect to
that matter.
Where a specific designation is given in the proxy with respect to the vote
on the election of directors, the appointment of independent accountants, or
approval of the Corporation's 1995 Long-Term Incentive Plan, the proxy will be
voted in accordance with such designation. If no such designation is made, the
proxy will be voted in favor of the directors named below, in favor of the
appointment of independent accountants, and in favor of the 1995 Long-Term
Incentive Plan. Anyone giving a proxy may revoke it at any time before its use
at the Meeting by personally appearing at the Meeting and casting a contrary
vote, or by giving a later proxy indicating a desire to vote differently than
is indicated by his earlier proxy.
ELECTION OF DIRECTORS
At this Annual Meeting six directors are to be elected, each to hold office
until the next Annual Meeting of Stockholders and until his or her successor
shall have been duly elected and shall qualify. Each nominee has been
recommended for election by the Nominating Committee of the Board of Directors
and by the Board. In the event that any such nominee should become unavailable
for election, the persons named in the proxy may vote for the election of a
substitute nominee. However, the Board of Directors has no reason to believe
that any of the nominees described below will be unavailable for election.
- 2 - <PAGE>
<PAGE>
Shirley D. Brinsfield, Chairman of the Board of Directors, has decided to
retire upon the expiration of his present term, and will not stand for
reelection as a director at the Annual Meeting of Stockholders. Mr. Brinsfield
has served as a director since 1972. His contribution through the years has
been valued and appreciated.
The following information is provided as of March 10, 1995 with respect to
each nominee for election as a director.
Business Experience and
Principal Occupation
For Last Five Years; Year
Directorships in Public First
Corporations and Investment Elected
Name Companies; Age Director
- ---------------- -------------------------------------------- --------
Thomas R. Berner Partner in Berner & Berner, P.C., attorneys.
Age 47. 1990
John S. Bull Former President of Moran Towing & Transpor-
tation Co., Incorporated, engaged in marine
transportation. Age 84. 1961
James B. Busey,IV President and chief executive officer of
Armed Forces Communications and Electronics
Association since September 1992; Director,
Mitre Corporation since February 1995;
Director, Texas Instruments, Incorporated
since July 1992; Deputy Secretary, U.S.
Department of Transportation, 1991-June 1992;
Administrator, Federal Aviation Administration,
1989-91; retired from U.S. Navy as Admiral in
1989. Age 62.
David Lasky President of Curtiss-Wright Corporation since
May 1993; formerly Senior Vice President,
General Counsel and Secretary of the Corporation.
Age 62. 1993
William W. Sihler Professor of Business Administration, Darden
Graduate School of Business Administration,
University of Virginia. Age 57. 1991
J. McLain Stewart Director, McKinsey & Company, Management
Consultants. Age 78. 1989
- 3 - <PAGE>
<PAGE>
The following table sets forth information concerning the ownership of
common stock of the Corporation by each director and nominee, each of the
executive officers named in the Summary Compensation Table below and all
directors and executive officers as a group, as of March 10, 1995. Except as
noted in the first footnote to this table, the shares were owned directly and
the owner had the sole voting and investment power in respect thereof. None of
those individuals owned any common stock of Unitrin, Inc., Argonaut Group,
Inc., or Teledyne, Inc. (For information in respect of the relationship among
Unitrin, Inc., Argonaut Group, Inc., Teledyne, Inc. and the Corporation, see
pages 18 and 19.)
% of
Number of Shares Outstanding
Name of Beneficial Owner Beneficially Owned Common Stock
- ------------------------ ------------------ ------------
Thomas R. Berner 485 a b
John S. Bull 250 b
James B. Busey, IV 0 b
David Lasky 36,541 c b
Robert E. Mutch 9,750 d b
Gerald Nachman 22,686 e b
William W. Sihler 200 b
J. McLain Stewart 0 b
Dana M. Taylor, Jr. 5,350 f b
George J. Yohrling 6,186 g b
Directors and Executive
Officers as a group
(13 persons) 81,448 1%
==============================================================================
Note:
======
a Includes 190 shares owned by Nancy Berner, wife of Mr. Berner. Mr. Berner
denies that he is the benefical owner of such shares.
b Less than one percent
c Includes right to purchase 12,900 shares through the exercise
of stock options.
d Includes right to purchase 6,500 shares through the exercise
of stock options.
e Includes right to purchase 6,900 shares through the exercise
of stock options.
f Includes right to purchase 3,400 shares through the exercise
of stock options.
g Includes right to purchase 3,060 shares through the exercise
of stock options.
- 4 - <PAGE>
<PAGE>
OPERATION OF BOARD OF DIRECTORS AND COMMITTEES
During 1994 the Board of Directors held five meetings. All of the Directors
attended at least 75% of the aggregate of all meetings in 1994 of the Board of
Directors and Committees on which they served.
The Audit Committee of the Board of Directors, presently consisting of
Messrs. Thomas R. Berner, John S. Bull, and William W. Sihler, met two times
during 1994. The Committee's functions include the following: making
recommendations to the Board as to the nomination of independent accountants
for appointment by the stockholders; reviewing annual financial statements of
the Corporation prior to their publication; reviewing the report by the
independent accountants concerning the prior year's audit and management's
response thereto; and consulting with the independent accountants and
management concerning internal accounting controls.
The Executive Compensation Committee, presently consisting of Messrs. Thomas
R. Berner, John S. Bull and J. McLain Stewart, met three times during 1994.
This Committee reviews compensation of elected officers prior to submission to
the Board; establishes specific awards to be made to individuals under the
Corporation's Incentive Compensation, Stock Option and Restricted Stock
Purchase Plans; and reviews the establishment and/or amendment of executive
compensation plans, including the Employees' Savings and Investment Plan.
The Nominating Committee, presently consisting of Messrs. John S. Bull and
J. McLain Stewart, met once in 1994. Its responsibilities include the
following: (i) recommending to the Board of Directors nominees for election as
Directors; (ii) establishing procedures for identifying candidates for the
Board and periodically reviewing potential candidates; and (iii) recommending
to the Board criteria for Board membership. Any stockholder may recommend
nominees to the Committee for consideration by writing to the Secretary of the
Corporation. Such submission should include the full name and address of each
proposed nominee, a statement of his or her business experience and
qualifications and a written statement from the proposed nominee consenting to
his or her nomination and agreeing to serve if elected.
INDEPENDENT ACCOUNTANTS
The Board of Directors has nominated the firm of Price Waterhouse for
appointment by the stockholders as independent accountants for the purpose of
auditing and reporting upon the financial statements of the Corporation for its
fiscal year ending December 31, 1995, subject to the approval of its
appointment by stockholders at the Annual Meeting. The firm of Price
Waterhouse was engaged on March 19, 1992 and served in this capacity for the
Corporation through the fiscal year ended December 31, 1994. The selection of
Price Waterhouse to serve as independent accountants of the Corporation was
based upon a recommendation by the Audit Committee of the Board of Directors
and was approved by the full Board. Representatives of Price Waterhouse are
expected to be present at the Annual Meeting of Stockholders to make such
statements and answer such questions as are appropriate.
If the stockholders fail to so appoint Price Waterhouse, the Board of
Directors, pursuant to the By-Laws of the Corporation, will appoint other
independent accountants to perform such duties for the current fiscal year.
It is not contemplated that such appointment of other independent accountants
would be submitted to the stockholders for ratification. The appointment of
independent accountants to serve with respect to the year 1996 would be acted
upon by the stockholders at their Annual Meeting early in that year.
- 5 - <PAGE>
<PAGE>
EXECUTIVE COMPENSATION
Report of Executive Compensation Committee
on Executive Compensation
The Executive Compensation Committee (the "Committee") of the Board of
Directors is responsible for the administration of the executive compensation
program of the Corporation. The Committee is composed of three non-employee
Directors, who are not eligible to participate in the Corporation's
compensation plans for employees.
In 1994 the compensation of the executive officers of the Corporation
consisted of salary, cash awards under the Modified Incentive Compensation Plan
(the "I.C. Plan") of the Corporation, and stock options pursuant to the
Corporation's amended 1985 Stock Option Plan. The levels of these compensation
elements are arrived at through consideration of a number of objective and
subjective factors. Salaries are reviewed by the Committee, generally
annually, largely on the basis of individual performance and contributions to
the Corporation. The recommendations of the Committee as to salary adjustments
are acted upon by the Board. The maximum amount available each year for awards
under the I.C. Plan is based solely on a formula tied to the earnings of the
Corporation as a whole (i.e., the sum of 12% of the excess over $3,000,000 of
consolidated net earnings (after taxes and before deducting such 12% amount) of
the Corporation and its subsidiaries for each of the four consecutive years
immediately preceding the year in which the current award is to be made, less
the aggregate amount of the awards made during the three consecutive years
immediately preceding the year in which the current award is to be made).
Stock options are offered to officers and key employees to provide additional
motivation to work toward increasing the value of the Corporation.
In determining Mr. Lasky's salary the Committee took into account specific
measures of performance, including operating income, return on net worth, and
operating cash flow, both actual and budgeted and forecasted for the
Corporation for the first quarter of 1994 as well as for full year 1993.
The Committee also took into consideration various indicators of corporate
performance in making an award to Mr. Lasky under the I.C. Plan. In awarding
stock options to Mr. Lasky, the Committee considered Mr. Lasky's efforts to
implement strategic planning methods to develop and grow the Corporation's
business. Also considered were a number of objective financial measures of
corporate performance.
With respect to considering the increase of salaries of its other executive
officers the Committee considered each person's years of service and total
compensation received. The Committee then considered schedules showing
operating income, return on net worth and operating cash flow, actual, budgeted
and forecasted, of each of the Corporation's facilities and of the Corporation
as a whole. At the same time, the Committee took into account the relationship
of the compensation of the Corporation's executive officers to the compensation
of individuals occupying comparable positions in other organizations of a
similar size and nature, with a view to ensuring that executives are
appropriately compensated, properly motivated and, where desirable, are
retained in the employment of the Corporation. The Committee also considered
factors relating to the performance of the individual officers. In making
awards to its executive officers under the I.C. Plan, the Committee took into
consideration the individual contributions each made to the success of the
Corporation, through personal ability, industry, loyalty and service pursuant
to the provisions of the I.C. Plan. The Board in turn has reviewed and
approved such awards.
- 6 - <PAGE>
<PAGE>
In awarding stock options to its key employees and executive officers the
Committee considered the effect such persons' efforts could have on the growth
of the Corporation. In determining the size of such awards, the Committee
considered the previously expressed views of its compensation consultant, who
had advised that awards of the size granted under the Stock Option Plan were
fair and reasonable and consistent with corresponding awards made by other
corporations.
John S. Bull, Chairman
Thomas R. Berner
J. McLain Stewart
SUMMARY COMPENSATION TABLE
------------------------------
The following table contains information concerning the five most highly
compensated executive officers of the Corporation.
<TABLE>
<CAPTION>
Long Term Awards
----------------------
Annual Compensation (f) (g) (i)
(a) ---------------------- Restricted Securities All
Name and Principal (b) (c) (d) Stock Underlying Other
Position Year Salary5 Bonus6 Awards7 Options Compensation8
- --------------------- ---- -------- -------- -------- --------- -------------
<S> <C> <C> <C> <C> <C> <C>
David Lasky, President 1994 $311,000 $183,500 7,500 $10,031
1993 $284,000 $158,500 5,400 $15,976
1992 $250,500 $158,500 $15,147
Gerald Nachman, 1994 $264,000 $ 93,250 3,700 $ 8,252
1 1993 $253,000 $108,250 3,200 $13,762
1992 $241,000 $108,250 $13,472
Robert E. Mutch 1994 $180,200 $ 64,000 3,500 $ 8,629
2 1993 $171,000 $ 67,000 3,000 $ 6,721
1992 $160,500 $ 67,000 $10,952
Dana M. Taylor, Jr., 1994 $162,615 $ 30,000 1,800 $ 6,666
3 1993 $154,115 $ 30,000 1,600 $ 9,234
George J. Yohrling 1994 $159,600 $ 49,300 1,710 $ 4,545
4 1993 $152,000 $ 55,000 1,350 $ 6,962
1992 $150,000 $ 55,000 $ 6,008
- --------------------------------------------------------------------------------------
Footnote on next Page
<PAGE>
Footnote to Preceeding Page
<FN>
1 Executive V.P. of Curtiss-Wright Corp; President, Metal Improvement Company
2 Executive V.P. of Curtiss-Wright Corp.; President, Curtiss-Wright Flight
Systems, Inc. and Curtiss-Wright Flight Systems/Shelby, Inc.
3 General Counsel & Secretary
4 V.P. of Curtiss-Wright Corp.; Sr. V.P., Curtiss-Wright Flight Systems /
Shelby, Inc.
5 Includes salaries and amounts deferred under the Corporation's Savings and
Investment Plan
6 Includes portions paid in 1992, 1993 and 1994 of deferred bonus installments
awarded in 1992 provided officer satisfied certain conditions, including
continued service with the corporation. Messrs. Lasky, Nachman and Mutch
received $13,500, $8,250 and $7,000 respectively in each year. Mr Taylor
received $5,000 in 1992 and 1993 and $125 in 1994 and Mr Yohrling received
$5,000 in 1992 and 1993 and $4,250 in 1994.
7 Mr. Lasky holds 1,200 shares of restricted common stock and Mr. Nachman holds
150 shares which are valued at $43,650 and $5,456, respectively, based upon the
closing market price at December 31, 1994. These shares however do not have a
current realizable value since they were purchased subject to restrictions
against sale, transfer or pledge and are subject to rights of repurchase for
various periods of at least three years from the date of grant. Holders of
restricted stock receive dividends at the same time and at the same rate as
other common stock owners.
8 This consists of the dollar value of insurance premiums paid by the
Corporation during the covered fiscal year for term life insurance and
contributions by the Corporation which have become vested pursuant to the
Corporation's Employees' Savings Plan made to September 1, 1994 at which time
the Plan was modified and contibutions were no longer made by the Corporation.
</TABLE>
- 7 - <PAGE>
<PAGE>
OPTIONS GRANTED IN LAST FISCAL YEAR
PURSUANT TO THE CORPORATION'S AMENDED 1985 STOCK OPTION PLAN
<TABLE>
<CAPTION>
% of Total
Option Grant
Shares Covered Granted to Exercise Date
by Options Employees Price Present
Name Granted 1 in 1994 per Share Expiration Date Value 2
- ----------- -------------- ---------- --------- ---------------- --------
<S> <C> <C> <C> <C> <C>
D. Lasky 7,500 14.5% $36.00 Nov. 15, 2004 $83,925
G. Nachman 3,700 7.1 36.00 Nov. 15, 2004 41,403
R. Mutch 3,500 6.7 36.00 Nov. 15, 2004 39,165
D. Taylor 1,800 3.4 36.00 Nov. 15, 2004 20,142
G. Yohrling 1,710 3.3 36.00 Nov. 15, 2004 19,134
</TABLE>
AGGREGATED OPTION/EXERCISES IN LAST FISCAL
YEAR AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
(a) (b) (c) (d) (e)
No. of Securities Value of Unexercised
Underlying In-the-Money
Unexecised Options Options
at Fiscal Year-End at Fiscal Year-End 3
Shares $
Aquired Value Exercisable / Exercisable /
Name on Exercise Realized Unexercisable Unexercisable
- ----------- ----------- -------- -------------------- --------------------
<S> <C> <C> <C> <C>
D. Lasky 0 0 1,800 / 11,100 $6,408 / $39,516
G. Nachman 0 0 1,067 / 5,834 3,798 / 20,769
R. Mutch 0 0 1,000 / 5,500 3,560 / 19,580
D. Taylor 0 0 533 / 2,866 1,897 / 10,203
G. Yohrling 0 0 450 / 2,610 1,602 / 9,292
Footnotes on next Page <PAGE>
<FN>
1 Options were granted with an exercise price of 100% of the market price on
the date of grant. The options are exercisable to the extent of one third of
the total number of shares covered beginning on the first anniversary of the
grant, two thirds from the second anniversary and in full after the third
anniversary. The options are not transferrable other than by will or by the
laws of descent and distribution. If the optionee terminates his or her
employement (other than by reason of retirement) the option expires upon such
event.
2 These values were calculated using the Black-Scholes option pricing model.
The Black-scholes model is a complicatd mathematical formula which is widely
used and accepted for valuing traded stock options. The model is premised on
immediate exercisability and transferability of the options. This is not true
for the Corporation's options granted to executive officers and other
Employees. Therefore, the values shown are theoretical and are not intended to
reflect the actual values the recipients may eventually realize. Any ultimate
value will depend on the market value of the Corporation's stock at a future
date. In addition to the stock price at time of grant and the execicse price,
which are identical, and the ten-year term of each option, the following
assumptions were used to calculate the values shown: expected dividend yield
(2.8 precent - the current yield of the Coporation's common shares on the grant
date), expected stock price volatility (.1039 - the most recent volatility for
the month-end stock prices of the Corporation's common shares for the 12 months
of the most recently completed calendar year), and risk-free rate of return
(8.0 percent - equal to the yield on a 10 year U.S. Treasury bond on the option
grant date).
3 Calculated by determining the difference between the fair market value of
the Common Stock underlying the options on December 31, 1994 ($36.00, the
closing price on the New York Stock Exchange Composite Transactions) and the
exercise price of the option date.
</TABLE>
- 8- <PAGE>
<PAGE>
Termination of Employment
- -------------------------
Pursuant to a policy designed to retain key employees established by the
Corporation's Board of Directors in 1977, the Corporation has agreements with
Messrs. Lasky, Nachman, Mutch, Taylor and Yohrling which provide for the
payment by the Corporation of severance pay, in the case of involuntary
termination of employment other than for cause, in an amount equal to one
year's base salary at the time of termination, as well as the continued
availability of certain employee benefits, for a period of one year following
termination. The agreements provide that such severance pay and benefits also
would be made available in the case of voluntary retirement or termination of
employment which is the direct result of a change in the terms or conditions of
employment, including a reduction in compensation or in job responsibilities.
At the option of the employee, said amount of severance pay may be paid over
the two year period following such termination, in which case such employee
benefits would continue in effect for the same period. Under the agreements,
the payment of severance pay, and the availability of benefits, is contingent
upon a number of conditions, including the employee's performance of his
agreements with respect to providing consulting services and not entering into
competition with the Corporation.
Retirement Plan
- ---------------
The Corporation's Retirement Plan is a tax qualified, defined benefit,
trusteed plan. On September 1, 1994 the Corporation amended this plan so as,
among other changes, to modify the benefits payable and to make the Plan
non-contributory. At the same time, the Retirement Plans of the Corporation's
Metal Improvement Company, Inc. and Curtiss-Wright Flight Systems/Shelby Inc.
subsidiaries were merged into the Corporation's Retirement Plan.
Prior to the September 1, 1994 actions, benefits were provided in two
parts. Part one benefits were those directly related to total annual
compensation (i.e., base salary plus, beginning July 1, 1970, incentive
compensation paid to the employee in the prior calendar year) on which employee
contributions (of 3% of annual compensation in excess of $3,600) were based.
Part two benefits were those related to average annual compensation for the
highest five consecutive years in the ten years prior to retirement. The
following tables illustrate the estimated aggregate amount of annual benefits
which will be payable on retirement at age 65 to an employee in the
compensation classification specified, computed on a straight life annuity
basis and under various assumptions as to compensation and years of
contributory participation in the program, attributable to service prior to
September 1, 1994.
- 9- <PAGE>
<PAGE>
Part I BENEFIT
<TABLE>
<CAPTION>
Assumed Annual
Compensation for Period of Resultant Annual Benefit
Contributory Participation Assuming Participation for
- --------------------------- --------------------------------------------------
15 years 20 years 25 years 30 years 35 years
-------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
$150,000 $22,500 $30,000 $37,500 $45,000 $52,500
200,000 30,000 40,000 50,000 60,000 70,000
250,000 37,500 50,000 62,500 75,000 87,500
300,000 45,000 60,000 75,000 90,000 105,000
350,000 52,500 70,000 87,500 105,000 122,500
400,000 60,000 80,000 100,000 120,000 140,000
450,000 67,500 90,000 112,500 135,000 157,500
500,000 75,000 100,000 125,000 150,000 175,000
550,000 82,500 110,000 137,500 165,000 192,500
600,000 90,000 120,000 150,000 180,000 210,000
650,000 97,500 130,000 162,500 195,000 227,500
</TABLE>
Part II BENEFIT
<TABLE>
<CAPTION>
Assumed Average Annual
Compensation Highest Resultant Annual Benefit
5 Consecutive Years in at Age 65
Last 10 Years Assuming 15 or More
Preceding Retirement Years of Service
- ----------------------- ------------------------
<S> <C>
$150,000 $43,920
200,000 58,920
250,000 73,920
300,000 88,920
350,000 103,920
400,000 118,920
450,000 133,920
500,000 148,920
550,000 163,920
600,000 178,920
650,000 193,920
</TABLE>
An employee whose compensation fell within the levels set forth on the
above tables would receive the appropriate amounts of both the Part I and Part
II Benefits shown above on his retirement by reason of his employment prior to
September 1, 1994.
- 10 - <PAGE>
<PAGE>
The Plan as amended on September 1, 1994 provides benefits computed
prospectively under a formula which is integrated with social security and
which provides for an annual benefit at age 65 equal to 1% of the employee's
five-year final average compensation up to the social security covered
compensation (currently $25,920) times years of service, plus 1.5% of
compensation in excess of covered compensation times years of service. The
amended Plan provides that employees are to receive their benefit accrued to
September 1, 1994, adjusted for increases in compensation between that date and
retirement or other termination, together with the benefit accruing under the
new Plan. The amended Plan also provides that an employee age 55 or older on
the date of the amendment with five years of contributory service as of August
31, 1994 shall not receive a lesser benefit than he would have received under
the Plan as in effect prior to the amendment, adjusted for the value of
contributions that would have been made subsequent to September 1, 1994. The
following table illustrates the estimated aggregate amount of annual benefits
attributable to service on or after September 1, 1994 under the new formula
that will be payable on retirement at age 65 to an employee in the compensation
classification specified, under various assumptions as to compensation and
years of service.
YEARS OF SERVICE
----------------------------------------------------------
Compensation 10 15 20 25 30 35
____________ ________ ________ ________ ________ ________ ________
$150,000 $ 21,204 $ 31,806 $ 42,408 $ 53,010 $ 63,612 $ 74,214
200,000 28,704 43,056 57,408 71,760 86,112 100,464
250,000 36,204 54,306 72,408 90,510 108,612 126,714
300,000 43,704 65,556 87,408 109,260 131,112 152,964
350,000 51,204 76,806 102,408 128,010 153,612 179,214
400,000 58,704 88,056 117,408 146,760 176,112 205,464
450,000 66,204 99,306 132,408 165,510 198,612 231,714
500,000 73,704 110,556 147,408 184,260 221,112 257,964
550,000 81,204 121,806 162,408 203,010 243,612 284,214
For all above charts, the current compensation covered by the Retirement
Plan is substantially equivalent to the cash compensation reported under the
headings entitled "Salary" and "Bonus" on page 7 of this Proxy Statement for
the executive officers listed there.
In addition, a cash balance component was added to the Plan on September 1,
1994 under which during each year of participation in the Plan a participant
earns a pay-based credit equal to 3% of his or her compensation. The
employee's account balance is credited with interest annually.
- 11 - <PAGE>
<PAGE>
Under the Employee Retirement Income Security Act of 1974 ("ERISA"), a
benefit is payable to the spouse of each employee commencing with his death,
unless a contrary election has been effectively made by the employee. In
practice, many employees do make such election and, as a consequence, the
amount actually received on retirement by such employees would be lower than
reflected by the above tables. The Internal Revenue Code provides that
effective January 1, 1995 the maximum allowable annual benefit under the
Retirement Plan is $120,000 (adjusted for each year of employment beyond
age 65) and the maximum allowable annual compensation that may be included in
the calculation of a benefit under the Retirement Plan is $150,000. These
limits are substantially lower than the maximum amounts shown above.
Accordingly, the Corporation maintains a Retirement Benefits Restoration Plan
(the "Restoration Plan") whereby all participants in the Retirement Plan whose
benefits or compensation under the Retirement Plan would exceed the limitations
imposed by the Internal Revenue Code will receive a supplemental retirement
benefit equal to the excess of the benefit which would have been payable to
hem under the Retirement Plan but for said limitations, over the amount payable
under the Retirement Plan, given said limitations. Such supplemental benefit
is not funded. On September 1, 1994 the Corporation also merged the Retirement
Benefits Restoration Plans of the Corporation's Metal Improvement Company and
Curtiss-Wright Flight Systems/Shelby, Inc. subsidiaries into the Curtiss-Wright
Retirement Benefits Restoration Plan. The amounts set forth in the preceding
table include amounts payable pursuant to the Restoration Plan. Benefit
amounts listed in the foregoing table are not subject to reduction for any
social security benefits to which Plan participants may be entitled. Credited
years of service under the Retirement Plan at December 31, 1994 are as follows:
David Lasky, 32 years; Gerald Nachman, 20 years; Robert E. Mutch, 16 years;
Dana M. Taylor, 21 years; and George Yohrling, 18 years.
COMPENSATION OF DIRECTORS
Currently all Directors who are not also employees of the Corporation
receive an annual director's fee of $20,000 except Mr. Brinsfield who receives
a retainer of $100,000 per annum, payable in equal quarterly installments, in
addition to the regular compensation paid non-employee Directors of the
Corporation. Each non-employee Director receives a fee of $900 for every Board
and Committee meeting attended. For each Director who is not an employee, the
Corporation provides group term life insurance coverage of $50,000.
PERFORMANCE GRAPH
Set forth below is a graph comparing the cumulative total stockholder
returns (assuming the reinvestment of dividends) on common stock of the
Corporation with such returns of companies listed on the Russell 2000 Index and
the S & P Aerospace/Defense Index. The graph assumes $100 invested on January
1, 1990 in stock of the Corporation and the companies on each of these indices.
- 12 - <PAGE>
<PAGE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
===============================================
DATE Curtiss-Wright Corp. Peer Group Russell 2000
-------- -------------------- ------------ --------------
12/29/89 0.00 100.00 100.00 100.00
12/31/90 -23.14 76.86 103.65 93.55
12/31/91 3.44 103.44 125.04 136.63
12/31/92 8.35 108.35 133.42 161.81
12/31/93 30.01 130.01 182.99 192.38
12/30/94 35.19 135.19 193.62 188.87
PROPOSAL TO APPROVE THE 1995 LONG-TERM INCENTIVE PLAN
The Company's 1995 Long-Term Incentive Plan (the "Plan") was adopted by the
Board of Directors on February 7, 1995. A copy of the Plan is attached hereto
as Exhibit A, and the following summary description is qualified in its
entirety by reference to the Plan. The purposes of the Plan are to advance the
long-term interests of the Company by motivating key employees with the
opportunity to obtain an equity interest in the Company, and to attract and
retain key employees upon whose judgment the success of the Company largely
depends. Under the terms of the Plan, the Executive Compensation Committee of
the Board of Directors may grant stock options, stock appreciation rights,
limited stock appreciation rights, restricted stock awards, performance shares,
and/or performance units to key employees of the Company.
The Plan will be effective as of May 5, 1995, subject to stockholder
approval, and will remain in effect for ten years after the date of shareholder
approval. This Plan will replace both the 1985 Stock Option Plan (which
expired on February 13, 1995) and the 1989 Restricted Stock Option Plan (which
will be terminated by passage of this Plan).
- 13 - <PAGE>
<PAGE>
NUMBER OF SHARES
================
The Plan provides that no more than 500,000 shares of the Company's Common
Stock will be available in the aggregate for the grant of stock options, stock
appreciation rights, limited stock appreciation rights, restricted stock
awards, performance shares, and/or performance units from time to time. The
total number of shares available for grant in each year shall be one percent of
the shares outstanding at the beginning of that year, although that number may
be increased by the number of shares available but unused in prior years, and
by the number of shares covered by previously terminated or forfeited awards.
No more than 25,000 shares of Common Stock subject to the Plan may be awarded
in any year to any participant in the Plan.
These numbers are subject to adjustment to reflect certain extraordinary
distributions of cash or shares of stock and certain stock changes such as
stock dividends, stock splits and share exchanges. Shares of Common Stock
available for issuance under the Plan may be authorized but unissued treasury
shares.
ADMINISTRATION; ELIGIBILITY
===========================
The Plan will be administered by the Executive Compensation Committee of the
Board of Directors of the Company (the "Committee") composed of not less than
three directors, each of whom shall be a "disinterested person" as that term is
used and defined under Rule 16b-3 under the Securities Exchange Act of 1934, as
amended. Members of the Committee will be appointed by and will serve at the
pleasure of the Board of Directors. The initial members of Committee are
Messrs. Berner, Bull and Stewart. The selection of the participants in the
Plan and the extent of the participation of each will be determined by the
Committee. Such participants will be employees of the Company and its
subsidiaries whose performance, as determined by the Committee, can have an
effect on the growth, profitability and success of the Company.
STOCK OPTIONS
=============
The Committee may grant a participant the option to purchase shares of Common
Stock of the Company through incentive stock options qualified under Section
422 of the Internal Revenue Code of 1986, as amended (the "Code") or options
not qualified under Section 422 of the Code ("non-qualified stock options") or
a combination of both. Incentive and non-qualified stock options must be
granted at not less than 100% of the fair market value of the underlying Common
Stock on the date the option is granted, except for up to 25% of the shares
which may be granted in the form of non-qualified stock options priced at no
less than 50% of the fair market value of the shares of Common Stock on the
date of grant. Upon exercise, the option price is to be paid in full in cash,
in shares of Common Stock, in such other consideration as the Committee may
deem appropriate, or through an arrangement with a broker. Options will be
exercisable in whole or in such installments and at such times as may be
determined by the Committee, provided that no incentive stock option may be
exercisable more than ten years after the date of its grant.
- 14 - <PAGE>
<PAGE>
STOCK APPRECIATION RIGHTS
=========================
The Committee may grant key employees the right to receive a payment equal to
the appreciation in market value of a stated number of shares of Common Stock
from the date of the agreement granting the stock appreciation right (the "base
price") to its date of exercise. These stock appreciation rights may or may
not be granted in tandem with stock options.
Stock appreciation rights granted in tandem with stock options will be
exercisable only to the extent the related stock option is exercisable and upon
exercise of such a tandem stock appreciation right, the related stock option
shall be canceled to the extent of the number of stock appreciation rights
exercised and such shares will not thereafter be eligible for grant under the
Plan. The base price for a tandem stock appreciation right will be determined
by the Committee, but it must not be less than the exercise price of the
related stock option.
Free-standing stock appreciation rights will be exercisable at the time or
times determined by the Committee. The base price for a free-standing stock
appreciation right will be determined by the Committee, but it must not be less
than the fair market value of the Common Stock on the date of the grant of the
stock appreciation right.
LIMITED STOCK APPRECIATION RIGHTS
=================================
The Committee may grant key employees the right to receive a payment in cash
equal to the appreciation over the base price by the greater of either the
highest price of shares of Common Stock paid in connection with a change in
control or the highest price of the shares of Common Stock during the 60 days
prior to the change in control. These limited stock appreciation rights may be
granted at the time the option or stock appreciation right is granted or at any
time thereafter. Limited stock appreciation rights are exercisable in full for
a period of seven months following the date of a change in control.
If limited stock appreciation rights are exercised, any stock options and
stock appreciation rights to which they are attached can no longer be
exercised. If the stock options or stock appreciation rights are exercised or
terminated, the limited stock appreciation rights are simultaneously canceled.
RESTRICTED STOCK AWARDS
=======================
The Plan permits the Committee to award restricted stock to key employees of
the Company (without payment of consideration by the participant) with such
terms, conditions, restrictions or limitations as the Committee deems
appropriate. While the restrictions are in effect, the Committee may permit a
participant the right to vote shares and the right to receive any dividends.
Restricted stock awards may be evidenced by stock certificates, book-entry
registrations or in such other manner as the Committee determines.
PERFORMANCE SHARES AND PERFORMANCE UNITS
========================================
The Plan permits the Committee to grant performance shares and performance
units to key employees, which will entitle the participant to convert the
performance shares or performance units into shares of Common Stock or into
cash or into a combination thereof, as determined by the Committee, if
pre-determined performance targets or goals are met. Performance goals will
include one or more of the following: net earnings, operating income, cash
flow, return on equity, return on capital employed, return on assets, and total
stockholder return. The Committee will determine the length of the performance
period.
- 15 - <PAGE>
<PAGE>
Award payments made in cash rather than by the issuance of shares
shall not result in additional shares being available for reissuance under the
Plan. No participant shall receive a cash award of more than $500,000 in any
plan year.
EMPLOYMENT; TRANSFERABILITY
===========================
The Committee is authorized under the Plan to adopt policies regarding the
entitlement of participants who cease to be employed by the Company because of
death, disability, resignation, termination or retirement. These policies may
vary depending upon the specific circumstances and the individual involved.
The rights and interests of a participant under the Plan, including his or
her rights under any award issued or granted under the Plan, may not be
assigned, sold, encumbered or transferred except by will or the laws of descent
and distribution in the event of the death of the participant.
AMENDMENTS
==========
The Committee may suspend, reinstate and terminate the Plan or any portion
thereof at any time. In addition, the Committee may, from time to time, amend
the Plan in any manner, but may not without stockholder approval adopt any
amendment which would (a) increase the number of shares of Common Stock which
may be issued under the Plan (except in the event of certain extraordinary
distributions of cash or shares of stock, as described in the Plan), or (b)
change the employees or class of employees eligible to participate in the Plan.
FEDERAL INCOME TAX CONSEQUENCES
===============================
The following is a summary of the Federal income tax treatment of the
incentive stock options, non-qualified stock options, stock appreciation
rights, limited stock appreciation rights, restricted stock awards, performance
shares and performance units that may be granted under the Plan based upon the
current provisions of the Code and regulations promulgated thereunder.
INCENTIVE STOCK OPTIONS. Incentive stock options under the Plan are intended
to meet the requirements of Section 422 of the Code. Under this section of the
Code, if an option holder acquires stock upon the exercise of an option, no
income will result to the option holder and the Company will be allowed no
deduction as a result of such exercise if the following conditions are met:
(a) at all times during the period beginning with the date of the grant of the
option and ending on the date three months before the date of such exercise,
the option holder is an employee of the Company or of a subsidiary; and (b) the
option holder makes no disposition of the stock within two years from the date
the option is granted nor within one year after the option is exercised. In
the event of a sale of such stock by the option holder after compliance with
these conditions, any gain realized over the price paid for the stock will
ordinarily be treated as a long-term capital gain, and any loss will ordinarily
be treated as a long-term capital loss, in the year of sale. The exercise of
an incentive stock option may result in alternative minimum tax liability to
the option holder.
If the option holder fails to comply with the employment or holding period
requirements discussed above, he will be treated as having received
compensation taxable as ordinary income or having received a capital gain in
accordance with the provisions of the Code. If the option holder is treated as
having received compensation because of this failure to comply with either
condition above, an equivalent deduction from income will be allowed to the
Company in the same year.
- 16 - <PAGE>
<PAGE>
NON-QUALIFIED STOCK OPTIONS. An option holder who exercises a non-qualified
stock option will generally realize compensation taxable as ordinary income in
an amount equal to the difference between the option price and the fair market
value of the shares on the date of exercise, and the Company will be entitled
to a deduction from income in the same amount. The option holder's basis in
such shares will be the fair market value on the date exercised, and the
long-term or short-term capital gain or loss, depending on the holding period
of the shares, will be recognized in the year of sale.
STOCK APPRECIATION RIGHTS. The grant of a stock appreciation right will not
result in tax consequences to the Company or to an option holder. An option
holder who exercises a stock appreciation right will realize compensation
taxable as ordinary income in an amount equal to the cash or the fair market
value of the shares received on the date of exercise, and the Company will
be entitled to a deduction in the same amount.
If an employee allows a stock appreciation right to expire, otherwise than as
a result of exercising the related option, the Internal Revenue Service may
contend that the employee will have taxable income in the year of expiration
equal to the amount of cash or the fair market value of stock which he would
have received if he had exercised his stock appreciation right immediately
before it expired. In addition, under Treasury Regulations governing incentive
stock options, a stock appreciation right with respect to an incentive stock
option must be granted at the same time the incentive stock option is granted
in order to ensure that the incentive stock option remains qualified as such.
LIMITED STOCK APPRECIATION RIGHTS. The grant of a limited stock appreciation
right will not result in tax consequences to the Company or to a participant.
A participant who exercises a limited stock appreciation right will realize
compensation taxable as ordinary income in an amount equal to the cash or the
fair market value of the shares received on the date of exercise, and the
Company will be entitled to a deduction in the same amount. A participant who
does not exercise at the time of a change in control and allows the limited
stock appreciation rights to lapse could be taxed as though exercise had
occurred at either of those two dates.
RESTRICTED STOCK AWARDS. Restricted stock awards granted under the Plan will
constitute taxable income to the recipient, and a deductible expense to the
Company, in the year in which the restrictions lapse unless the participant
elects to recognize income in the year the award is made. Unless such an
election is made, the amount of the taxable income and corresponding deduction
will be equal to the excess of the fair market value of the stock on the date
the restrictions lapse over the amount, if any, paid for such stock. The
Company is also allowed a compensation deduction for dividends paid to
participants (provided they have not elected to recognize income at the time of
the award) on restricted stock while the restrictions remain in force.
PERFORMANCE SHARES AND PERFORMANCE UNITS. Performance shares and performance
units awarded under the Plan will not constitute a taxable event to the
recipient until such time as the recipient actually receives shares of Common
Stock or cash related to such award. The amount of taxable income will be
equal to the amount of cash received or the fair market value of stock received
at such time. The Company will be entitled to a compensation deduction in the
same year.
RECOMMENDATION OF THE BOARD OF DIRECTORS; VOTE REQUIRED
The Board of Directors recommends approval of the Plan.
- 17 - <PAGE>
<PAGE>
SECURITY OWNERSHIP AND TRANSACTIONS WITH CERTAIN BENEFICIAL
OWNERS
The following information is given with respect to the persons who, to the
knowledge of the Corporation, own beneficially more than 5% of any class of the
voting securities of the Corporation outstanding as of March 10, 1995.
Amount & Nature Percent
Name & Address of of Beneficial of
Title of Class Beneficial Owner Ownership Class
- ---------------- ---------------------------- ------------------ ---------
Common Stock Unitrin, Inc.
One East Wacker Drive 2,191,200 shares 43.3%
Chicago, Illinois 60601 Indirect
Common Stock Argonaut Group, Inc.
1800 Avenue of the Stars 411,100 shares 8.1%
Los Angeles, Cal. 90067 Indirect
Common Stock GAMCO Investors, Inc. 540,720 shares 10.69%
and Direct
Gabelli Funds, Inc. 189,900 shares 3.75%
Corporate Center at Rye Direct
Rye, NY 10580
Common Stock Quest Advisory Corp. 326,400 shares 6.45%
and Direct
Quest Management Co. 21,000 shares 0.42%
1414 Ave. of the Americas Direct
New York, NY 10019
A Schedule 13D dated April 6, 1990 of Unitrin, Inc. ("Unitrin") and two of
its subsidiaries reported: (i) ownership by those subsidiaries of the
2,191,200 shares of common stock shown above; (ii) that the stock had been
acquired for investment; (iii) that each of the subsidiaries shares with
Unitrin voting and dispositive power with respect to the stock owned by that
subsidiary and (iv) that Unitrin might be deemed a beneficial owner of this
stock. A Teledyne, Inc. ("Teledyne") Schedule 13D amendment dated April 6,
1990 indicated that the Unitrin subsidiaries owning common stock of the
Corporation had been Teledyne subsidiaries but that as a result of the spin-off
by Teledyne to its stockholders of the outstanding stock of Unitrin, those
companies had ceased to be Teledyne subsidiaries, effective March 31, 1990.
The amendment also stated that Teledyne may no longer be deemed to be a
beneficial owner of the common stock of the Corporation owned by the Unitrin
subsidiaries. According to Teledyne's proxy statement dated March 18, 1994
three of the seven Directors of Unitrin are Directors of Teledyne. The
Teledyne proxy statement also indicates that Directors and executive officers
of Teledyne own beneficially in the aggregate over 20% of the outstanding
common stock of Unitrin.
A Schedule 13D dated October 9, 1986 of Argonaut Group, Inc. ("Argonaut") and
three of its subsidiaries reported: (i) ownership by those subsidiaries of the
411,100 shares of common stock shown above; (ii) that the stock had been
acquired for investment; (iii) that each of those subsidiaries shares with
Argonaut voting and dispositive power with respect to the stock owned by that
subsidiary and (iv) that Argonaut might be deemed a beneficial owner of this
stock.
- 18 - <PAGE>
<PAGE>
A Teledyne Schedule 13D amendment dated October 9, 1986 also indicated
that the Argonaut subsidiaries owning common stock of the Corporation had been
Teledyne subsidiaries but that as a result of the spin-off by Teledyne to its
stockholders of the outstanding stock of Argonaut, those companies had ceased
to be Teledyne subsidiaries, effective September 30, 1986. The amendment also
stated that Teledyne may no longer be deemed to be a beneficial owner of the
common stock of the Corporation owned by the Argonaut subsidiaries. Teledyne's
proxy statement dated March 18, 1994 indicates that four of the five Argonaut
Directors are also Directors of Teledyne and that Directors and executive
officers of Teledyne beneficially own in the aggregate more than 20% of
Argonaut's outstanding common stock. Finally, the Teledyne proxy statement
states that three Directors of Unitrin are also Directors of Argonaut.
Under the circumstances outlined above, Teledyne may be deemed to be in
"control" of the Corporation (as the term control is defined in the regulations
promulgated pursuant to the Securities Exchange Act of 1934). However, to date
no attempt has been made to obtain representation on the Board of Directors of
the Corporation, to direct its management or policies or otherwise to exercise
"control" over it.
Since January 1, 1994 the Corporation and its subsidiaries have engaged in
various transactions with subsidiaries of Teledyne in the ordinary course of
business, each of which was either in an amount of less than $60,000 or was
awarded on the basis of competitive bidding.
In their Schedule 13D as amended through July 22, 1993, GAMCO Investors, Inc.
("GAMCO") and Gabelli Funds, Inc. ("GFI") have reported that (i) they are
investment advisers and beneficially own the shares set forth in the above
table but have no economic interest in the shares (such interest presumably
residing in their investment advisory clients); (ii) the shares were purchased
for investment; (iii) GAMCO exercises sole voting and dispositive power over
462,720 shares, and sole dispositive power and no voting power over the
balance, and GFI exercises sole voting and sole dispositive power over 189,900
shares; (iv) GAMCO and GFI were formerly wholly-owned subsidiaries of The
Gabelli Group, Inc. ("TGGI") which, effective August 31, 1990, merged into GFI,
and GAMCO is a wholly-owned subsidiary of GFI; (v) Mario J. Gabelli ("Gabelli")
is the majority stockholder, Chairman of the Board and Chief Executive Officer
of GFI, the sole director and Chairman and Chief Executive Officer of GAMCO,
and Chief Investment Officer of GAMCO and GFI; and (vi) Gabelli is deemed to
have beneficial ownership of the shares beneficially owned by GAMCO and GFI but
GAMCO and GFI do not admit that they constitute a "group" in respect of the
shares.
A February 10, 1995 amended Schedule 13G filed by Quest and QMC reported that
they had increased their beneficial ownership from 240,400 shares to 326,400
shares and from 18,900 shares to 21,000 shares, respectively, of common stock
of the Corporation. The amended report stated that Charles M. Royce may be
deemed to be a controlling person of Quest and QMC and as such may be deemed to
beneficially own the shares of common stock of Curtiss-Wright beneficially
owned by Quest and QMC but that he disclaimed beneficial ownership of the
shares held by Quest and QMC. The amended report further stated that these
shares had been acquired in the ordinary course of business and not for the
purposes of control of the Corporation.
- 19 - <PAGE>
<PAGE>
OTHER MATTERS WHICH MAY BE PRESENTED FOR ACTION AT THE MEETING
The Board of Directors does not intend to present for action at this Annual
Meeting any matter other than those specifically set forth in the Notice of
Annual Meeting. If any other matter is properly presented for action at the
Meeting, it is the intention of persons named in the proxy to vote thereon in
accordance with their judgment pursuant to the discretionary authority
conferred by the proxy.
PROPOSALS OF STOCKHOLDERS
Proposals of stockholders intended to be presented at the next Annual Meeting
must be received by the Office of the Secretary, Curtiss-Wright Corporation,
1200 Wall Street West, Lyndhurst, New Jersey 07071 no later than November 13,
1995 for inclusion in the Corporation's Proxy Statement and form of proxy
relating to that Meeting.
PERSONS MAKING THE SOLICITATION
This solicitation of proxies is made on behalf of the Board of Directors of
the Corporation, and the cost thereof will be borne by the Corporation. The
Corporation will reimburse brokerage firms and nominees for their expenses in
forwarding proxy material to beneficial owners of the stock of the Corporation.
In addition, a number of employees, officers and directors of the Corporation
(none of whom will receive any compensation therefore in addition to his
regular compensation) may solicit proxies. The solicitation will be made by
mail and in addition, the telephone, facsimile, telegrams and personal
interviews may be utilized.
By Order of the Board of Directors
Dana M. Taylor, Jr.
Secretary
Date: March 13, 1995
- 20 -
EXHIBIT A
CURTISS-WRIGHT CORPORATION
The 1995 Long-Term Incentive Plan
SECTION 1. PURPOSES.
The purposes of the 1995 Curtiss-Wright Long-Term Incentive Plan (the "Plan")
are to encourage selected key employees of Curtiss-Wright Corporation (the
"Company") to acquire a proprietary and vested interest in the growth and
performance of the Company, and to generate an increased incentive to
contribute to the Company's future success and prosperity, thereby enhancing
the value of the Company for the benefit of stockholders and the ability of the
Company to attract and retain individuals of exceptional talent.
SECTION 2. DEFINITIONS.
As used in the Plan, the following terms shall have the meanings set forth
below:
(a) "Award" shall mean any Option, Stock Appreciation Right, Limited Stock
Appreciation Right, Restricted Stock Award, Performance Share, Performance
Unit, Other Stock Unit Award, or any other right, interest, or option granted
pursuant to the provisions of the Plan.
(b) "Award Agreement" shall mean any written agreement, contract, or other
instrument or document evidencing any Award granted hereunder and signed by
both the Company and the Participant.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, including the rules, regulations, and interpretations promulgated
thereunder.
(e) "Committee" shall mean the Executive Compensation Committee of the Board,
composed of not less than three directors each of whom is a Disinterested
Person.
(f) "Company" shall mean Curtiss-Wright Corporation.
(g) "Disinterested Person" shall have the meaning set forth in Rule 16b-3(d)(3)
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended, or any successor definition adopted by the
Commission.
(h) "Dividend Equivalent" shall mean any right granted pursuant to Section
13(i) hereof to receive an equivalent amount of interest or dividends with
respect to the number of shares covered by an Award.
(i) "Employee" shall mean any salaried employee of the Company or its
Subsidiaries.
(j) "Fair Market Value" shall mean, with respect to any property, the market
value of such property determined by such methods or procedures as shall be
established from time to time by the Committee.
- 1 - <PAGE>
<PAGE>
(k) "Incentive Stock Option" shall mean an Option granted under Section 6
hereof that is intended to meet the requirements of Section 422 of the Code or
any successor provision thereto.
(l) Limited Stock Appreciation Right shall mean a Stock Appreciation Right
that can only be exercised in the event of a change in control, according to
the definition and provisions of Section 8 of the Plan.
(m) "Non-qualified Stock Option" shall mean an Option granted to a Participant
under Section 6 hereof that is not intended to be an Incentive Stock Option.
(n) "Option" shall mean any right granted to a Participant under the Plan
allowing such Participant to purchase Shares at such price or prices and during
such period or periods as the Committee shall determine.
(o) "Participant" shall mean an Employee who is selected by the Committee to
receive an Award under the Plan.
(p) "Performance Award" shall mean any Award of Performance Shares or
Performance Units pursuant to Section 10 hereof.
(q) "Performance Period" shall mean that period established by the Committee at
the time any Performance Award is granted or at any time thereafter during
which any performance goals specified by the Committee with respect to such
Award are to be measured.
(r) "Performance Share" shall mean any grant pursuant to Section 10 hereof of a
unit valued by reference to a designated number of Shares, which value may be
paid to the Participant by delivery of such property as the Committee shall
determine, including, without limitation, cash, Shares, or any combination
thereof, upon achievement of such performance goals during the Performance
Period as the Committee shall establish at the time of such grant or
thereafter.
(s) "Performance Unit" shall mean any grant pursuant to Section 10 hereof of a
unit valued by reference to a designated amount of property other than Shares,
which value may be paid to the Participant by delivery of such property as the
Committee shall determine, including, without limitation, cash, Shares, or any
combination thereof, upon achievement of such performance goals during the
Performance Period as the Committee shall establish at the time of such grant
or thereafter.
(t) "Person" shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, or government or
political subdivision thereof.
(u) "Restricted Stock" shall mean any Share issued with the restriction that
the holder may not sell, transfer, pledge, or assign such Share and with such
other restrictions as the Committee, in its sole discretion, may impose
(including, without limitation, any restriction on the right to vote such
Share, and the right to receive any cash dividends), which restrictions may
lapse separately or in combination at such time or times, in installments or
otherwise, as the Committee may deem appropriate.
(v) "Restricted Stock Award" shall mean an award of Restricted Stock under
Section 9 hereof.
- 1 - <PAGE>
<PAGE>
(w) "Shares" shall mean shares of the common stock of the Company, $1.00 par
value, and such other securities of the Company as the Committee may from time
to time determine.
(x) "Stock Appreciation Right" shall mean any right granted to a Participant
pursuant to Section 7 hereof to receive, upon exercise by the Participant,
either, the excess of the Fair Market Value of one Share on the date of
exercise
or, if the Committee shall so determine in the case of any such right
other than one related to any Incentive Stock Option, the excess of the Fair
Market Value of one Share at any time during a specified period before the date
of exercise
over the grant price of the right as specified by the Committee, in its sole
discretion, on the date of grant, which shall not be less than the Fair Market
Value of one Share on such date. Any payment by the Company in respect of such
right may be made in cash, Shares, other property, or any combination thereof,
as the Committee, in its sole discretion, shall determine.
(y) "Stockholder Meeting" shall mean the annual meeting of stockholders of the
Company held each year.
(z) "Subsidiaries" shall mean any corporation or corporations in which the
Company owns directly, or indirectly through subsidiaries, at least fifty
percent (50%) of the total combined voting power of all classes of stock, or
any other entity (including, but not limited to, partnerships and joint
ventures) in which the Company owns at least fifty percent (50%) of the
combined equity thereof.
SECTION 3. ADMINISTRATION.
The Plan shall be administered by the Committee. The Committee shall have full
power and authority, subject to such orders or resolutions not inconsistent
with the provisions of the Plan as may from time to time be adopted by the
Board, to: (i) select the Employees of the Company to whom Awards may from time
to time be granted hereunder; (ii) determine the type or types of Award to be
granted to each Participant hereunder; (iii) determine the number of Shares to
be covered by each Award granted hereunder; provided, however, that Shares
subject to any form of award granted to any individual employee during any
calendar year shall not exceed twenty-five thousand (25,000), subject to any
adjustment according to the terms of Section 4(b); (iv) determine the terms and
conditions, not inconsistent with the provisions of the Plan, of any Award
granted hereunder; (v) determine whether, to what extent and under what
circumstances Awards may be settled in cash, Shares or other property or
canceled or suspended; (vi) determine whether, to what extent and under what
circumstances cash, Shares and other property and other amounts payable with
respect to an Award under this Plan shall be deferred either automatically or
at the election of the Participant; (vii) interpret and administer the Plan and
any instrument or agreement entered into under the Plan; (viii) establish such
rules and regulations and appoint such agents as it shall deem appropriate for
the proper administration of the Plan; and (ix) make any other determination
and take any other action that the Committee deems necessary or desirable for
administration of the Plan. Decisions of the Committee shall be final,
conclusive and binding upon all persons, including the Company, any
Participant, any stockholder, and any employee of the Company or its
- 2 - <PAGE>
<PAGE>
Subsidiaries. A majority of the members of the Committee may determine
its actions and fix the time and place of its meetings.
SECTION 4. SHARES SUBJECT TO THE PLAN.
(a) Subject to adjustment as provided in Section 4(b), the total number of
Shares available for grant under the Plan in each calendar year shall be one
percent (1.0%) of the total outstanding Shares as of the first day of such
year for which the Plan is in effect; provided that such number shall be
increased in any year by the number of Shares available for grant hereunder in
previous years but not covered by Awards granted hereunder in such years, as
well as Shares subject to Awards forfeited or terminated in the manner noted
below; and provided further, that no more than five hundred thousand (500,000)
Shares shall be cumulatively available for grant under the Plan. In addition,
any Shares issued by the Company through the assumption or substitution of
outstanding grants from an acquired company shall not reduce the shares
available for grants under the Plan. Any Shares issued hereunder may consist,
in whole or in part, of authorized and unissued shares or treasury shares. If
any Shares subject to any Award granted hereunder are forfeited or such Award
otherwise terminates without the issuance of such Shares or of other
consideration in lieu of such Shares, the Shares subject to such Award,
to the extent of any such forfeiture or termination, shall again be available
for grant under the Plan.
(b) In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, extraordinary cash dividend, or other change
in corporate structure affecting the Shares, such adjustment shall be made in
the aggregate number of Shares which may be delivered under the Plan, and in
the number of Shares subject to outstanding Options granted under the Plan, and
in the price or number of Shares subject to Awards granted under the Plan as
may be determined to be appropriate by the Committee, in its sole discretion,
and provided that the number of Shares subject to any Award shall always be a
whole number.
SECTION 5. ELIGIBILITY.
Any Employee (excluding any member of the Committee) shall be eligible to be
selected as a Participant.
SECTION 6. STOCK OPTIONS.
Options may be granted hereunder to Participants either alone or in addition to
other Awards granted under the Plan. Any Option granted to a Participant under
the Plan shall be evidenced by an Award Agreement in such form as the Committee
may from time to time approve. Any such Option shall be subject to the
following terms and conditions and to such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee shall deem
desirable:
(a) Option Price. The purchase price per Share purchasable under an Option
shall be determined by the Committee in its sole discretion; provided that such
purchase price in the case of Incentive Stock Options shall not be less than
the Fair Market Value of the Share on the date of the grant of the Option. In
no event shall the Option Price of any Non-qualified Stock Option be less than
50% of the Fair Market Value of the Shares on the date of grant, and the number
of such below-market Options shall be limited to 25% of the Options available
for grant in any calendar year.
- 3 - <PAGE>
<PAGE>
(b) Option Period. The term of each Option shall be fixed by the Committee in
its sole discretion; provided that no Incentive Stock Option shall be
exercisable after the expiration of ten years from the date the Option is
granted.
(c) Exercisability. Options shall be exercisable at such time or times as
determined by the Committee at or subsequent to grant. Unless otherwise
determined by the Committee at or subsequent to grant, no Incentive Stock
Option shall be exercisable during the year ending on the day before the first
anniversary date of the granting of the Incentive Stock Option.
(d) Exercise of Options. Options granted under the Plan shall be exercisable
at such times and be subject to such restrictions and conditions as the
Committee shall in each instance approve, which need not be the same for each
grant or for each Participant.
(e) Payment. Options shall be exercised by the delivery of a written notice of
exercise to the Company, setting forth the number of Shares with respect to
which the Option is to be exercised, accompanied by full payment for the
Shares. The Option price shall be payable in full to the Company either: in
cash or its equivalent, or by tendering to the Company, or certifying by the
Participant to the satisfaction of the Company, previously acquired Shares
having an aggregate Fair Market Value at the time of exercise equal to the
total Option price (provided that the Shares which are tendered or certified
must have been held by the Participant for at least six (6) months prior to
their tender or certification), or by a combination of these methods. The
Committee may also allow cashless exercise as permitted under the Federal
Reserve Board's Regulation T, subject to applicable securities law
restrictions, or by any other means the Committee determines to be consistent
with the Plan's purpose and applicable law.
(f) Incentive Stock Options. In accordance with rules and procedures
established by the Committee, the aggregate Fair Market Value (determined as of
the time of grant) of the Shares with respect to which Incentive Stock Options
held by any Participant which are exercisable for the first time by such
Participant during any calendar year under the Plan (and under any other
benefit plans of the Company or subsidiary of the Company) shall not exceed
$100,000 or, if different, the maximum limitation in effect at the time of
grant under Section 422 of the Code, or any successor provision, and any
regulations promulgated thereunder. The terms of any Incentive Stock Option
granted hereunder shall comply in all respects with the provisions of Section
422 of the Code, or any successor provision, and any regulations promulgated
thereunder.
SECTION 7. STOCK APPRECIATION RIGHTS.
Stock Appreciation Rights may be granted hereunder to Participants either alone
or in addition to other Awards granted under the Plan and may, but need not,
relate to a specific Option granted under Section 6. The provisions of Stock
Appreciation Rights need not be the same with respect to each recipient. Any
Stock Appreciation Right related to a Non-qualified Stock Option may be granted
at the same time such Option is granted or at any time thereafter before
exercise or expiration of such Option. Any Stock Appreciation Right related to
an Incentive Stock Option must be granted at the same time such Option is
granted. In the case of any Stock Appreciation Right related to any Option,
the Stock Appreciation Right or applicable portion thereof shall terminate and
no longer be exercisable upon the termination or exercise of the related
Option, except that a Stock Appreciation Right granted with respect to less
- 4 - <PAGE>
<PAGE>
than the full number of Shares covered by a related Option shall not be reduced
until the exercise or termination of the related Option exceeds the number of
shares not covered by the Stock Appreciation Right. Any Option related to any
Stock Appreciation Right shall no longer be exercisable to the extent the
related Stock Appreciation Right has been exercised. The Committee may impose
such conditions or restrictions on the exercise of any Stock Appreciation Right
as it shall deem appropriate.
SECTION 8. LIMITED STOCK APPRECIATION RIGHTS.
Limited Stock Appreciation Rights may be granted hereunder to Participants in
addition to or related to any Option or Stock Appreciation Right granted under
the Plan. A Limited Stock Appreciation Right may be granted at the time the
Option or Stock Appreciation Right is granted or at any time thereafter.
Limited Stock Appreciation Rights are exercisable in full for a period of seven
months following the date of a Change in Control as defined in Section 11(b).
(a) Amount of Payment. The amount of payment to which a Participant shall be
entitled upon the exercise of each Limited Stock Appreciation Right shall be
equal to the difference between the Option price of the Shares covered by the
related Option or Stock Appreciation Right and the Market Price of such Shares.
Market Price is defined to be the greater of (i) the highest price of the
Shares paid in connection with a Change in Control and (ii) the highest price
of the Shares reflected in the New York Stock Exchange Transactions Report
during the 60-day period prior to the Change in Control.
(b) Form of Payment. Payments to Participants upon the exercise of Limited
Stock Appreciation Rights shall be made solely in cash.
(c) Effect of Exercise. If Limited Stock Appreciation Rights are exercised,
the Options and Stock Appreciation Rights related to them cease to be
exercisable. Upon the exercise or termination of the Options or Stock
Appreciation Rights, the related Limited Stock Appreciation Rights terminate.
SECTION 9. RESTRICTED STOCK.
(a) Issuance. Restricted Stock Awards may be issued hereunder to Participants,
for no cash consideration, either alone or in addition to other Awards granted
under the Plan. The provisions of Restricted Stock Awards need not be the same
with respect to each recipient.
(b) Registration. Any Restricted Stock issued hereunder may be evidenced in
such manner as the Committee in its sole discretion shall deem appropriate,
including, without limitation, book-entry registration or issuance of a stock
certificate or certificates. In the event any stock certificate is issued in
respect of shares of Restricted Stock granted under the Plan, such certificate
shall be registered in the name of the Participant, and shall bear an
appropriate legend referring to the terms, conditions, and restrictions
applicable to such Award.
(c) Forfeiture of Restricted Stock Award. Except as otherwise determined by
the Committee at the time of grant, upon termination of employment for any
reason during the restriction period, all shares of Restricted Stock still
subject to restriction shall be forfeited by the Participant and reacquired by
the Company; provided that in the event of a Participant's retirement,
permanent disability, other termination of employment or death, or in cases of
special circumstances, the Committee may, in its sole discretion, when it finds
that a waiver would be in the best interests of the Company, waive in whole or
in part any or all remaining restrictions with respect to such Participant's
- 5 - <PAGE>
<PAGE>
shares of Restricted Stock. Unrestricted Shares, evidenced in such manner as
the Committee shall deem appropriate, shall be issued to the grantee promptly
after the period of forfeiture, as determined or modified by the Committee.
SECTION 10. PERFORMANCE AWARDS.
Performance Awards, including Performance Shares and Performance Units, may be
issued hereunder to Participants, for no cash consideration or for such minimum
consideration as may be required by applicable law, either alone or in addition
to other Awards granted under the Plan. The performance standards to be used
during any Performance Period shall include measures such as net earnings,
operating income, cash flow, return on equity, return on capital employed,
return on assets, and total stockholder return. The performance standards
selected and the length of the Performance Period shall be determined by the
Committee upon the grant of each Performance Award. Except as provided in
Section 11, Performance Awards will be paid only after the end of the relevant
Performance Period. Performance Awards may be paid in cash, Shares, other
property or any combination thereof, in the sole discretion of the Committee at
the time of payment. The performance levels to be achieved for each Performance
Period and the amount of the Award to be distributed shall be conclusively
determined by theCommittee. Performance Awards may be paid in a lump sum or in
installments following the close of the Performance Period or, in accordance
with procedures established by the Committee, on a deferred basis. The maximum
cash award paid to any Participant during any plan year shall be no more than
five hundred thousand dollars ($500,000).
SECTION 11. CHANGE IN CONTROL.
(a) In order to maintain the Participants'rights in the event of any Change in
Control of the Company, as hereinafter defined, the Committee, as constituted
before such Change in Control, may, in its sole discretion, as to any Award,
either at the time an Award is made hereunder or any time thereafter, take any
one or more of the following actions: (i) provide for the acceleration of any
time periods relating to the exercise or realization of any such Award so that
such Award may be exercised orrealized in full on or before a date fixed by the
Committee; (ii) provide for the purchase of any such Award, upon the
Participant's request, for an amount of cash equal to the amount that could
have been attained upon the exercise of such Award or realization of the
Participant's rights had such Award been currently exercisable or payable;
(iii) make such adjustment to any such Award then outstanding as the Committee
deems appropriate to reflect such Change in Control; or (iv) cause any such
Award then outstanding to be assumed, or new rights substituted therefor, by
the acquiring or surviving corporation after such Change in Control. The
Committee may, in its discretion, include such further provisions and
limitations in any agreement documenting such Awards as it may deem equitable
and in the best interests of the Company.
(b) A Change in Control shall be deemed to have occurred for the purposes of
the Plan on the date of occurrence of any of the events set forth in clauses
(1), (2) and (3) of this subparagraph;
(1) the date the Company acquires knowledge of the filing under the Exchange
Act of a statement on Schedule 13D, or any amendment thereto, relating to a
transaction or series of transactions in which any person or group deemed a
person under Section 13(d)(3) of the Exchange Act shall have become the
beneficial owner, directly or indirectly (with beneficial ownership
determined as provided in Rule 13d-3, or any successor rule, under the
Exchange Act), of securities of the Company entitling the person or group to
20% or more of all votes to which all shareholders of the Company would be
- 6 - <PAGE>
<PAGE>
entitled in the election of Directors were an election held on such date;
provided, that any shares held by a person or group who filed or who would
have been obligated to file a Schedule 13D or 13G with respect to beneficial
ownership of securities of the Company prior to January 1, 1995,
any affiliate or associate as of January 1, 1995 of any such person, any
beneficiary or any trust or estate included in any such person or group, any
member of the family of any such person, and trust or estate (including
the trustees or executors thereof) established by or for the benefit of any
such person, or any charitable foundation, whether a trust or a corporation
(including the trustees and directors thereof) established by or for the
benefit of any such person (in each case, an "Existing Shareholder"), shall
be excluded from the shares held by any person or group for purposes of
determining whether the foregoing 20% threshold for securities ownership has
been reached by such person or group; and provided further that,
notwithstanding the foregoing, the securities beneficially owned by any
Existing Shareholder shall not be so excluded from the securities
beneficially owned by any person or group if such person or group includes
any person who is not an Existing Shareholder and such person or group has
beneficial ownership of securities of the Company having 20% or more of all
votes in the election of directors;
(2) the date on which there is a failure of individuals who were members of
the Board of Directors as of May 5, 1995 to constitute at least a majority of
the Board of Directors, unless the election (or the nomination for election
by the shareholders) of each new director was approved by a vote of at least
two-thirds of the total of such individuals then still in office and such
other directors as may previously have been elected or nominated pursuant to
such a two-thirds vote; or
(3) the date of approval by the shareholders of the Company of an agreement
( a "reorganization agreement") providing for (i) the merger or consolidation
of the Company with another corporation in which the Company is not the
surviving corporation, or pursuant to which its common stock is converted,
other than a merger where the shareholders of the Company immediately prior
to the merger or consolidation beneficially own, immediately after the merger
or consolidation, shares of the corporation issuing cash or securities in the
merger or consolidation entitling such shareholders to 50% or more of all
votes to which all shareholders of such corporation would be entitled in the
election of Directors or where the members of the Board of Directors of the
Company immediately prior to the merger or consolidation constitute,
immediately after the merger or consolidation, a majority of the Board of
Directors of the corporation issuing cash or securities in the merger or
consolidation, or (ii) the sale or other disposition or liquidation of all or
substantially all of the assets of the Company; provided, however that
notwithstanding anything to the contrary in this Plan, no transaction or
series of transactions shall constitute a "Change in Control" as to the
holder of any Stock Option if such transaction or series of transactions
required such holder to be identified in any United States securities law
filing as a person or a member of any group acquiring, holding or disposing
of beneficial ownership of the Company's securities and effecting a "Change
in Control" as defined herein.
SECTION 12. AMENDMENTS AND TERMINATION.
The Board may amend, alter or discontinue the Plan, but no amendment,
alteration, or discontinuation shall be made that would impair the rights of a
Participant under an Award heretofore granted, without the Participant's
consent, or that without the approval of the stockholders would:
- 7 - <PAGE>
<PAGE>
(a) except as is provided in Section 4(b) of the Plan, increase the total
number of shares reserved for the purposes of the Plan; or
(b) change the employees or class of employees eligible to participate in the
Plan.
The Committee may amend the terms of any Award heretofore granted,
prospectively or retroactively, but no such amendment shall impair the rights
of any Participant without his consent. The Committee may also substitute new
Awards for Awards previously granted to Participants, including without
limitation previously granted Options having Fair Market Value or higher option
prices, except the number of Options substituted shall not exceed ten percent
(10%) of the total number of shares authorized under the Plan.
The Plan shall become effective on May 5, 1995, and shall remain in effect,
subject to the right of the Board to amend, alter or discontinue the Plan as
described above, until May 5, 2005.
SECTION 13. GENERAL PROVISIONS.
(a) The adoption of this Plan by the stockholders at the 1995 Stockholder
Meeting will simultaneously terminate the 1989 Restricted Stock Purchase Plan.
Outstanding Awards under the 1989 Restricted Stock Plan shall continue in full
force and subject to the provisions of the 1989 Restricted Stock Plan.
(b) No Award shall be assignable or transferable by a Participant otherwise
than by will or by the laws of descent and distribution; provided that, if so
determined by the Committee, a Participant may, in the manner established by
the Committee, designate a beneficiary to exercise the rights of the
Participant with respect to any Award upon the death of the Participant. Each
Award shall be exercisable, during the lifetime of the Participant, only by the
Participant or, if permissible under applicable law, by the guardian or legal
representative of the Participant.
(c) The term of each Award shall be for such period of months or years from the
date of its grant as may be determined by the Committee; provided that in no
event shall the term of any Incentive Stock Option or any Stock Appreciation
Right related to any Incentive Stock Option exceed a period of ten (10) years
from the date of its grant.
(d) No Employee or Participant shall have any claim to be granted any Award
under the Plan and there is no obligation for uniformity of treatment of
Employees or Participants under the Plan.
(e) The prospective recipient of any Award under the Plan shall not, with
respect to such Award, be deemed to have become a Participant, or to have any
rights with respect to such Award, until and unless such recipient shall have
executed an agreement or other instrument evidencing the Award and delivered a
fully executed copy thereof to the Company, and otherwise complied with the
then applicable terms and conditions.
(f) The Committee shall be authorized to make adjustments in Performance Award
standards or in the terms and conditions of other Awards in recognition of
unusual or nonrecurring events affecting the Company or its financial
statements or changes in applicable laws, regulations or accounting principles.
The Committee may correct any defect, supply any omission or reconcile any
- 8 - <PAGE>
<PAGE>
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry it into effect. In the event the Company shall assume
outstanding employee benefit awards or the right or obligation to make future
such awards in connection with the acquisition of another corporation or
business entity, the Committee may, in its discretion, make such adjustments in
the terms of Awards under the Plan as it shall deem appropriate.
(g) The Committee shall have full power and authority to determine any other
type and form of Award beyond those enumerated above to grant a Participant for
the furtherance of the purposes of the Plan.
(h) The Committee shall have full power and authority to determine whether, to
what extent and under what circumstances any Award shall be canceled or
suspended. In particular, but without limitation, all outstanding Awards to
any Participant shall be canceled if the Participant, without the consent of
the Committee, while employed by the Company or after termination of such
employment, becomes associated with, employed by, renders services to, or owns
any interest in (other than any nonsubstantial interest, as determined by the
Committee), any business that is in competition with the Company or with any
business in which the Company has a substantial interest as determined by the
Committee.
(i) All certificates for Shares delivered under the Plan pursuant to any Award
shall be subject to such stock-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Shares are then listed, and any applicable Federal or state
securities law, and the Committee may cause a legend or legends to be put on
any such certificates to make appropriate reference to such restrictions.
(j) Subject to the provisions of this Plan and any Award Agreement, the
recipient of an Award (including, without limitation, any deferred Award) may,
if so determined by the Committee, be entitled to receive, currently or on a
deferred basis, interest or dividends, or interest or Dividend Equivalents,
with respect to the number of shares covered by the Award, as determined by the
Committee, in its sole discretion, and the Committee may provide that such
amounts (if any) shall be deemed to have been reinvested in additional Shares
or otherwise reinvested.
(k) As circumstances may from time to time require, the Committee may in its
sole discretion make available to Participants loans for the purpose of
exercising Options. These loans shall include such terms as the Committee
deems reasonable in its sole discretion.
(l) The Company shall be authorized to withhold from any Award granted or
payment due under the Plan the amount of withholding taxes due with respect to
an Award or payment hereunder and to take such other action as may be necessary
in the opinion of the Company to satisfy all obligations for the payment of
such taxes. The Company shall also be authorized to accept the delivery of
shares by a Participant in payment for the withholding of federal, state and
local taxes (but not for social security and Medicare taxes) up to the
Participant's marginal tax rate.
(m) Nothing contained in this Plan shall prevent the Board of Directors from
adopting other or additional compensation arrangements, subject to stockholder
approval if such approval is required; and such arrangements may be either
generally applicable or applicable only in specific cases.
- 9 - <PAGE>
<PAGE>
(n) The validity, construction, and effect of the Plan and any rules and
regulations relating to the Plan shall be determined in accordance with the
laws of the State of New Jersey and applicable Federal law.
(o) If any provision of this Plan is or becomes or is deemed invalid, illegal
or unenforceable in any jurisdiction, or would disqualify the Plan or any Award
under any law deemed applicable by the Committee, such provision shall be
construed or deemed amended to conform to applicable laws or if it cannot be
construed or deemed amended without, in the determination of the Committee,
materially altering the intent of the Plan, it shall be stricken and the
remainder of the Plan shall remain in full force and effect.
