<PAGE>
[LOGO]
BENJAMIN MOORE & CO.
-----------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
-----------------------------
The Annual Meeting of the Shareholders of Benjamin Moore & Co. will be
held on Thursday, the 27th day of April 2000, at 11:00 o'clock in the
morning, New Jersey time, at the Park Ridge Marriott Hotel, 300 Brae
Boulevard, Park Ridge, New Jersey, for the following purposes:
1. To elect one (1) Class I Director to hold office for one year and
three (3) Class III Directors to hold office for three years each.
2. To transact such other business as may properly be brought before
the meeting, or any adjournment or postponement thereof.
In accordance with the Bylaws of the Company, the Board of Directors
has fixed the close of business on March 3, 2000 as the record date for the
meeting. Accordingly, only shareholders of record at the close of business
on March 3, 2000 will be entitled to notice of and to vote at the meeting.
Whether or not you expect to be personally present at the meeting,
please complete, date, sign and return the enclosed proxy in the envelope
which is provided in order to be certain that your shares will be voted at
the meeting.
If you attend, we invite you to stay for lunch after the meeting. In
order that we may plan for lunch, we request you to please complete and
return the enclosed card together with the proxy.
Montvale, New Jersey
March 27, 2000
By Order Of The Board of Directors
John T. Rafferty
SECRETARY
<PAGE>
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of Benjamin Moore & Co., a New Jersey corporation (the
"Company"), of proxies to be used at the Annual Meeting of Shareholders to be
held on the 27th day of April 2000, at 11:00 o'clock in the morning, New Jersey
time, or at any adjournment or postponement thereof (the "Meeting"). Only
shareholders of record at the close of business on March 3, 2000 (the "Record
Date") will be entitled to notice of and to vote at the Meeting.
The principal executive offices of the Company are located at 51
Chestnut Ridge Road, Montvale, New Jersey 07645. This Proxy Statement and the
related Notice of Annual Meeting of Shareholders and proxy were first sent or
given to shareholders on or about March 27, 2000.
The Company's Annual Report to Shareholders for the fiscal year ended
December 31, 1999, including financial statements, accompanies this Proxy
Statement and the related Notice of Annual Meeting of Shareholders and proxy.
The cost of the solicitation of proxies will be borne by the Company.
In addition to the solicitation of proxies by use of the mails, the Company may
use the services of its officers and regular employees (none of whom will
receive any compensation therefor in addition to their regular compensation) to
solicit proxies, personally or by telephone. Arrangements may also be made with
banks, brokerage houses and other custodians, nominees and fiduciaries to
forward the proxy materials to the beneficial owners, and the Company may
reimburse such banks, brokerage houses, custodians, nominees and fiduciaries for
their reasonable expenses in connection therewith. At the 1999 Annual Meeting of
Shareholders, more than 91% of the outstanding shares were represented at the
meeting in person or by proxy.
OUTSTANDING SHARES
At the close of business on March 3, 2000, there were 26,677,868 shares
of Common Stock, par value $3.33 1/3 per share, outstanding. Each share of
Common Stock is entitled to one vote on all matters with respect to which
holders thereof are entitled to vote, as set forth in the accompanying Notice of
Annual Meeting of Shareholders.
PROXY PROCEDURE
The form of proxy provides space for a shareholder to withhold
authority to vote for any or all nominees for the Board of Directors. The
election of Directors requires a plurality of the votes cast. Abstentions and
broker non-votes are counted for purposes of determining whether a quorum is
present at the Meeting. For purposes of election of Directors, abstentions and
broker non-votes are not considered as votes cast. The presence of a majority of
the outstanding shares of Common Stock will constitute a quorum. Votes will be
counted by duly appointed inspectors of election, whose responsibilities are to
ascertain the number of shares outstanding and the voting power of each,
determine the number of shares represented at the Meeting and the validity of
proxies and ballots, count all votes and report the results to the Company.
A properly completed, signed and dated proxy which is received prior to
the Meeting will be voted in the manner specified therein. If authority to vote
for one or more of the nominees for election as Director has not been withheld
on the proxy in accordance with the instructions set forth thereon, the proxy
will be voted for the election of all such nominees. However, if authority to
vote for one or more of such nominees is withheld, the proxy will only be voted
for the election of the balance of such nominees (if any).
At the date of this Proxy Statement, the Board of Directors does not
know of any matters to be brought before the Meeting which are not set forth in
the accompanying Notice of Annual Meeting of Shareholders.
<PAGE>
A proxy in the accompanying form will confer discretionary authority with
respect to any such other matter. If any such other matter or matters are
properly brought before the Meeting or any adjournment(s) or postponement(s)
thereof, it is the intention of the persons named in the accompanying form of
proxy to vote the shares represented thereby in accordance with their best
judgment.
A shareholder may revoke his or her proxy prior to the voting thereof
by giving written notice of revocation to the Secretary of the Company, by
executing and delivering a later dated proxy, or by attending the Meeting and
voting his or her shares in person.
PRINCIPAL SHAREHOLDERS
Set forth below is certain information, as of March 3, 2000 (or in the
case of interests under the employees' stock ownership portion of the Company's
Deferred Savings and Investment Plan (the "ESOP"), the most recent allocation
date which is December 31, 1999), with respect to certain persons, including
each person who, to the knowledge of the Company, may be deemed to own
beneficially (within the meaning of the applicable rules and regulations of the
Securities and Exchange Commission) more than five percent of the Company's
Common Stock. In reviewing the following table, it should be noted that, as set
forth in the notes thereto, a substantial number of the shares are held in
trusts, the trustees of which are more than one of the persons named below;
accordingly, the number of shares set forth opposite the name of each such
person (and the corresponding percentage ownership represented thereby) refers,
in several instances, to the same shares.
The shares shown include stock options issued under the Stock Option
Plans of the Company which are exercisable on or within sixty days after March
3, 2000. The stock options permit the purchase of a total of 3,000 shares,
55,500 shares, 73,500 shares and 39,750 shares by Messrs. Belcher, Jr., Dupuy,
Roob and Vail, respectively, each of whom is a Director of the Company. Such
shares were also considered to be outstanding for the purpose of calculating
percentage ownership for each person.
SHARES OWNED APPROXIMATE
BENEFICIALLY PERCENTAGE OF
AS OF OUTSTANDING
NAME AND ADDRESS MARCH 3, 2000 SHARES
- ---------------- ------------- ------
Benjamin M. Belcher, Jr. 2,842,239 (1) 10.7
51 Chestnut Ridge Road
Montvale, New Jersey 07645
Yvan Dupuy 1,273,743 (2) 4.8
51 Chestnut Ridge Road
Montvale, New Jersey 07645
Richard Roob 1,651,148 (3) 6.2
51 Chestnut Ridge Road
Montvale, New Jersey 07645
Charles C. Vail 1,578,665 (4) 5.9
51 Chestnut Ridge Road
Montvale, New Jersey 07645
Benjamin Moore & Co. Employees' Stock 1,190,523 (5) 4.5
Ownership Plan Trust
51 Chestnut Ridge Road
Montvale, New Jersey 07645
2
<PAGE>
(1) Includes 2,522,922 shares held by trusts of which Mr. Belcher, Jr. is a
co-trustee. The other co-trustees of said trusts are as follows: (a) trusts
holding a total of 48,000 of such shares--individuals having no affiliation
with the Company; (b) trusts holding 1,260,399 of such shares--Mr. Vail and
an individual having no affiliation with the Company; and (c) a trust
holding 24,000 of such shares--Mrs. Sara B. Wardell, a Director of the
Company. In each case, the co-trustees are empowered to make all decisions
in respect of the shares, including the voting and disposition thereof.
Also, Mr. Belcher, Jr. is one of three trustees of the ESOP. Mr. Belcher,
Jr. has an interest under the ESOP in 7,386 shares. The other trustees are
Mr. Yvan Dupuy and Mr. Richard Roob, each of whom is a Director of the
Company. Mr. Belcher, Jr.'s wife owns 8,472 shares which are not counted
above, and in which he disclaims any beneficial interest.
(2) Mr. Dupuy is one of three trustees of the ESOP. Mr. Dupuy has an interest
under the ESOP in 3,873 shares. The other trustees are Mr. Benjamin M.
Belcher, Jr. and Mr. Richard Roob, each of whom is a Director of the
Company.
(3) Includes 1,300,878 shares held by trusts of which Mr. Roob is a co-trustee.
The other co-trustees of said trusts are as follows: (a) a trust holding
57,600 of such shares -- Mrs. Wardell and Mr. Vail; (b) a trust holding
24,177 of such shares -- an individual having no affiliation with the
Company and a retiree of the Company; and (c) a trust holding 28,578 of
such shares -- an individual having no affiliation with the Company. In
each case, the trustees are empowered to make all decisions in respect of
the shares, including the voting and disposition thereof. Also, Mr. Roob is
one of three trustees of the ESOP. Mr. Roob has an interest under the ESOP
in 9,837 shares. The other trustees are Mr. Benjamin M. Belcher, Jr. and
Mr. Yvan Dupuy, each of whom is a Director of the Company. Mr. Roob's wife
owns 70,000 shares which are not counted above, and in which he disclaims
any beneficial interest.
(4) Includes 1,519,299 shares held by trusts of which Mr. Vail is a co-trustee.
The other co-trustees of said trusts are as follows: (a) trusts holding
1,260,399 of such shares -- Mr. Belcher, Jr. and an individual having no
affiliation with the Company; (b) a trust holding 57,600 of such shares --
Mr. Roob and Mrs. Wardell; (c) a trust holding 72,000 of such shares --
Mrs. Wardell; (d) a trust holding 100,800 of such shares -- an individual
having no affiliation with the Company; (e) a trust holding 24,000 of such
shares -- an individual having no affiliation with the Company; and (f) a
trust holding 4,500 of such shares -- an individual having no affiliation
with the Company and a retiree of the Company. The co-trustees are
empowered to make all decisions in respect of the shares, including the
voting and disposition thereof. Also includes 3,116 shares in which Mr.
Vail has an interest under the ESOP. Mr. Vail's wife owns 600 shares which
are not counted above, and in which he disclaims any beneficial interest.
(5) The ESOP (described hereafter) owns these shares and the three trustees are
Mr. Benjamin M. Belcher, Jr., Mr. Yvan Dupuy and Mr. Richard Roob.
3
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Pursuant to the Company's Certificate of Incorporation and Bylaws, the
Board of Directors is divided into three classes. Each year the Directors in one
class are elected to serve terms of three years.
The Board of Directors has nominated Ward C. Belcher for election as a
Class I Director and Frederick J. Costello, John C. Moore, Jr. and Richard Roob
for election as Class III Directors at the 2000 Annual Meeting of Shareholders.
All of the nominees were previously elected by the shareholders. The nominee for
election as a Class I Director, if elected, will hold office for a one-year term
until the Annual Meeting of Shareholders to be held in the year 2001, and until
a successor has been duly elected and qualified. The three (3) nominees for
election as Class III Directors, if elected, will each hold office for a
three-year term until the Annual Meeting of Shareholders to be held in the year
2003, and until a successor has been duly elected and qualified.
Mr. Maurice C. Workman is retiring at the time of the 2000 Annual
Meeting of Shareholders after 37 years of service as a Director. Accordingly,
the Board of Directors pursuant to the Bylaws of the Company has determined that
the number of Directors of the Company will be reduced from 12 to 11, effective
April 27, 2000, upon the expiration of the term of Mr. Workman.
The persons named as proxies in the accompanying form of proxy have
advised the Company that, unless otherwise instructed, they intend to vote the
shares covered by duly executed proxies for the election of Ward C. Belcher,
Frederick J. Costello, John C. Moore, Jr. and Richard Roob. All of the nominees
have agreed to serve if elected. Should any such person become unable or
unavailable for election as a Director, an event which the Board of Directors
does not anticipate, the individuals appointed as proxies reserve the right to
vote such shares for the election of such substitute nominee(s) as the Board of
Directors may propose.
The following table sets forth certain information with respect to the
one (1) nominee for election as a Class I Director to hold office for one year
and the three (3) nominees for election as Class III Directors to hold office
for three years and with respect to each Director whose term of office will
continue after the Meeting. See also "Ownership of Securities by Directors and
Named Executive Officers" below.
NOMINEES FOR ELECTION
<TABLE>
<CAPTION>
YEAR TERM SERVED AS
OF OFFICE A DIRECTOR
NAME AGE PRINCIPAL OCCUPATION WILL EXPIRE SINCE
- ---- --- -------------------- ----------- -----
<S> <C> <C> <C> <C>
CLASS I DIRECTOR
Ward C. Belcher 53 Retired; Vice President-Operations of the 2001 1988
Company from 1989 to 1999 (1)
CLASS III DIRECTORS
Frederick J. Costello*+ss.(x) 62 Retired executive of Union Carbide Corporation, 2003 1997
a chemicals company; President of
the Solvents and Coatings Materials
Division of Union Carbide
Corporation from 1989 until
retirement in 1993
John C. Moore, Jr.+(y) 55 Retired; Employed by Electronic Data Systems 2003 1994
(EDS), providing management consulting and
technology planning, from 1985 to 1999
Richard Roob *# 67 Chairman of the Board of Directors 2003 1979
of the Company since 1984 and Chief
Executive Officer since 1996
4
<PAGE>
DIRECTORS WHOSE TERMS OF OFFICE
WILL CONTINUE AFTER THE MEETING
CLASS II DIRECTORS
Charles H. Bergmann, Jr.+ss.(x) 56 Managing Partner, Bergmann Enterprises 2002 1996
Ltd. Partnership, an investment partnership;
Consultant, Wealth Management, LLC,
personal financial advisors,
Appleton, Wisconsin; Director of
Communications, Alto Dairy
Cooperative, a dairy products
manufacturer in Waupun, Wisconsin
from 1989 to 1999
Robert H. Mundheim ss.# 67 Of Counsel, Shearman & Sterling, a law 2002 1997
firm; Senior Executive Vice President and
General Counsel from December 1997
through December 1998 of Salomon
Smith Barney Holdings, Inc. which
together with its subsidiaries
conducts global investment banking,
global securities and commodities
trading; Executive Vice President
and General Counsel from September
1992 to 1997 of Salomon Inc., a
predecessor of Salomon Smith Barney
Holdings, Inc.
Charles C. Vail *(y) 56 Senior Vice President of the Company and a 2002 1986
Vice President since 1988
Sara B. Wardell # 57 Managing Director, Scoville Memorial Library, 2002 1987
Salisbury, Ct., from 1978 to 1993 and since
then has been a library consultant (1)
CLASS I DIRECTORS
Benjamin M. Belcher, Jr.*(y) 65 Retired; Executive Vice President of the 2001 1975
Company from 1991 to 1998 (1)
Yvan Dupuy *# 48 President and Chief Operating Officer of the 2001 1990
Company since 1996; Senior Vice President
of the Company from 1995 to 1996;
Vice President-Sales and Marketing of the
Company from 1988 to 1995
Gerald W. Moore *+ss.#(x) 67 Retired business executive; private investor 2001 1994
from 1989 to the present
</TABLE>
* Member of the Executive and Finance Committee.
+ Member of the Audit Committee.
ss. Member of the Compensation Committee.
# Member of the Governance Committee.
(x) Member of the Stock Option Committee.
(y) Member of the Retirement Income Plan Investment Committee.
(1) Messrs. B. M. Belcher, Jr. and W. C. Belcher are brothers and Mrs.
Wardell is their sister.
5
<PAGE>
OWNERSHIP OF SECURITIES BY DIRECTORS AND NAMED EXECUTIVE OFFICERS
Set forth below is certain information, as of March 3, 2000 (or in the
case of interests under the employees' stock ownership portion of the Company's
Deferred Savings and Investment Plan (the "ESOP"), the most recent allocation
date which is December 31, 1999), with respect to the shares of Common Stock of
the Company, and with respect to the Common Shares of its Canadian subsidiary,
which may be deemed to be beneficially owned (within the meaning of the
applicable rules and regulations of the Securities and Exchange Commission), by
each nominee for election as a Director of the Company, by each of its current
Directors, by each of the executive officers named in the Summary Compensation
Table appearing below and by all Directors and executive officers as a group. In
reviewing the following table, it should be noted that as set forth in the notes
thereto, a substantial number of the shares are held in trusts, the trustees of
which are more than one of the persons named below; accordingly, the number of
shares set forth opposite the name of each such person (and the corresponding
percentage ownership presented below) refers, in several instances, to the same
shares.
The shares shown include stock options issued under the Stock Option
Plans of the Company which are exercisable on or within sixty days after March
3, 2000. The stock options permit the purchase of a total of 3,000 shares,
33,000 shares, 10,500 shares, 55,500 shares, 73,500 shares and 39,750 shares by
Messrs. B.M. Belcher, Jr., W. C. Belcher, Devine, Dupuy, Roob and Vail,
respectively, 6,000 shares each by Messrs. Bergmann, Jr., Costello, G.W. Moore,
J.C. Moore, Jr., Mundheim and Workman and Mrs. Wardell and 334,550 shares by all
Directors and executive officers as a group. Such shares were also considered to
be outstanding for the purpose of calculating percentage ownership for each
person or the group.
<TABLE>
<CAPTION>
SHARES OF
SHARES OF APPROXIMATE CANADIAN APPROXIMATE
COMPANY PERCENTAGE OF SUBSIDIARY PERCENTAGE OF
OWNED AS OF OUTSTANDING OWNED AS OF OUTSTANDING
NAME 3/3/00 SHARES 3/3/00 SHARES
---- ------ ------ ------ ------
<S> <C> <C> <C> <C>
Benjamin M. Belcher, Jr (1) (1)
Ward C. Belcher 754,983 (2) 2.8 9,180(9) .7
Charles H. Bergmann, Jr 314,850 (3) 1.2
Frederick J. Costello 7,500 *
Donald E. Devine II 18,000 *
Yvan Dupuy (1) (1) 1,000 *
Gerald W. Moore 277,626 (4) 1.0
John C. Moore, Jr 1,046,874 (5) 3.9
Robert H. Mundheim 10,500 *
Richard Roob (1) (1) 3,450 *
Charles C. Vail (1) (1) 7,160(10) .5
Sara B. Wardell 695,246 (6) 2.6 13,910(11) 1.1
Maurice C. Workman 21,345 (7) *
Directors and executive officers 6,767,367 (8) 25.0 27,540 (8) 2.1
as a group (19 persons,
including the above)
</TABLE>
*Represents 0.4% or less of the outstanding shares of Common Stock of the
Company or its Canadian subsidiary.
(1) Reference is made to the information set forth under the caption
"Principal Shareholders" above, and to the table and the notes
thereunder.
(2) Includes 109,446 shares of the Company's Common Stock held by trusts of
which Mr. Ward C. Belcher is a co-trustee. The co-trustees are empowered
to make all decisions in respect of the shares, including the voting and
disposition thereof. Also includes 5,091 shares in which Mr. Belcher has
an interest under the Company's ESOP. In addition, Mr. Belcher is
Custodian of 89,922 of such shares held under the Uniform Gifts to Minors
Act. Mrs. Ward C. Belcher owns 17,940 shares of the Company's Common
Stock of which 12,768 shares are held as Custodian under the Uniform
Gifts to Minors Act. Mr. Belcher disclaims any beneficial interest in
such shares which are not counted above.
6
<PAGE>
(3) Includes 282,678 shares owned by Bergmann Enterprises Limited Partnership
of which Mr. Bergmann, Jr. is the managing general partner. Also includes
12,528 shares held by a trust of which Mr. Bergmann, Jr. is a co-trustee
with Mrs. Charles H. Bergmann, Jr. and a trust holding 11,916 shares held
by a trust of which Mr. Bergmann, Jr. is a co-trustee with his son. Mrs.
Bergmann, Jr. is a trustee with their son of a trust holding 24,192
shares which are not counted above, and in which Mr. Bergmann, Jr.
disclaims any beneficial interest.
(4) Includes shares held by two trusts of which Mr. Gerald W. Moore is a
trustee. Mr. Gerald W. Moore is: (a) the sole trustee of a trust holding
148,248 of such shares and (b) a co-trustee with a bank of a trust
holding 104,472 of such shares. The trustees are empowered to make all
decisions in respect of the shares, including the voting and disposition
thereof.
(5) Includes 1,039,824 shares held by a trust of which Mr. John C. Moore, Jr.
is a co-trustee with his uncle and two cousins. The co-trustees are
empowered to make all decisions in respect of the shares, including the
voting and disposition thereof.
(6) Includes 176,927 shares held by trusts of which Mrs. Wardell is a
co-trustee. The other co-trustees of said trusts are as follows: (a) a
trust holding 57,600 of such shares--Mr. Roob and Mr. Vail; (b) a trust
holding 72,000 of such shares--Mr. Vail; (c) a trust holding 24,000 of
such shares--Mr. Belcher, Jr.; (d) a trust holding 23,127 of such
shares--a bank; and (e) a trust holding 200 of such shares--an individual
having no affiliation with the Company. Mrs. Wardell's adult daughter
owns 82,083 shares which are not counted above, and in which she
disclaims any beneficial interest. Mrs. Wardell's husband owns 400 shares
which are not counted above, and in which she disclaims any beneficial
interest.
(7) Mrs. Maurice C. Workman owns 15,267 shares which are not counted above,
and in which Mr. Workman disclaims any beneficial interest.
(8) Shares which may be deemed to be owned by more than one executive officer
or Director have been counted only once for purposes of the group totals.
(9) Includes 1,230 shares held as custodian for his children.
(10) Consists of 7,160 shares held by a trust of which Mrs. Wardell is a
co-trustee. The co-trustees are empowered to make all decisions in
respect of the shares, including the voting and disposition thereof.
(11) Includes 7,160 shares held by a trust of which Mr. Vail is a co-trustee.
The co-trustees are empowered to make all decisions in respect of the
shares, including the voting and disposition thereof.
Shares owned by the Directors' parents (including the Estates of
parents), spouses, adult children and their spouses, brothers or sisters and
their spouses (except those who are Directors of the Company), aunts, uncles and
first cousins, in which shares beneficial ownership is disclaimed, total
3,609,683 shares, or 13.5% of the outstanding shares.
COMMITTEES OF THE BOARD OF DIRECTORS
The Company has an Executive and Finance Committee, an Audit Committee, a
Compensation Committee, a Governance Committee, a Stock Option Committee and a
Retirement Income Plan Investment Committee. The Executive and Finance Committee
may exercise all powers of the Board of Directors with certain exceptions as
required by law. The Audit Committee functions include recommending to the Board
of Directors the engagement of the independent public accountants for the
Company, reviewing with the independent public accountants the plan and results
of the audit engagement, considering the effect of any non-audit services upon
the independence of the accountants, approving the fees for audit and non-audit
services, and reviewing with the independent public accountants certain internal
accounting controls. The Compensation Committee is responsible for the approval
of the Company's performance bonus plan and for compensation arrangements for
each executive officer named in the Summary Compensation Table appearing below;
it reviews and approves performance goals for senior executives. The Governance
Committee, among other things, evaluates and recommends candidates for election
to the Board of Directors and assesses the performance of Directors. The Stock
Option Committee administers the Company's Stock Option Plans. The Retirement
Income Plan Investment Committee oversees the management of the Company's
pension plan invested assets.
7
<PAGE>
During 1999, there were five meetings of the Board of Directors, three
meetings of the Audit Committee, four meetings of the Executive and Finance
Committee, seven meetings of the Compensation Committee, four meetings of the
Governance Committee, three meetings of the Stock Option Committee and three
meetings of the Retirement Income Plan Investment Committee. Each Director of
the Company attended at least 75% of the meetings of the Board of Directors and
the Committee or Committees of which such person was a member.
DIRECTOR COMPENSATION
FEES
Directors of the Company who are employees of the Company receive no
fees for their services as Directors. Directors who are not employees of the
Company receive an annual retainer of $24,000 plus $2,000 for each meeting of
the Board of Directors and $1,000 for each Board Committee meeting attended. In
addition, the Chairperson of each Board Committee is paid a $5,000 annual
retainer and each Committee member is paid a $3,000 annual retainer. Expenses
for attending meetings are also reimbursed.
OPTIONS
In accordance with the provisions of the 1998 Stock Incentive Plan,
stock options covering 3,000 shares are granted each year to each non-employee
Director under the provisions of the Plan.
COMMON STOCK EQUIVALENTS
The Company has a Directors Deferred Compensation Plan. Pursuant to the
Plan a non-employee Director may elect, prior to the commencement of the next
calendar year, to have all or a portion of his or her retainer fee and all or a
portion of his or her meeting fees credited to a deferred compensation account.
This account, which is carried in the form of stock equivalent units of the
Company's Common Stock and dividends credited thereon, is paid out in a lump sum
cash payment on or before the last day of the calendar month following the
calendar month upon which he or she ceases to be a Director of the Company.
EXECUTIVE COMPENSATION
The following table sets forth information for each of the last three
fiscal years concerning the compensation earned by the Company's Chief Executive
Officer and each of the other four most highly compensated executive employees
of the Company during 1999 who were executive officers of the Company as of the
end of such fiscal year.
8
<PAGE>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
NAME AND SALARY BONUS COMPENSATION OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR ($) (1) ($) (2) ($) (3) (#) (4) ($) (5)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Richard Roob 1999 660,000 467,708 2,582 54,000 2,298
Chairman of the 1998 633,000 296,781 3,730 60,000 2,173
Board of Directors and 1997 609,500 160,000 4,782 0 2,239
Chief Executive Officer
Yvan Dupuy 1999 422,506 252,925 14,247 54,000 2,298
President and 1998 378,000 160,503 12,579 60,000 2,173
Chief Operating Officer 1997 349,992 101,750 5,818 0 2,239
Charles C. Vail 1999 254,262 108,173 18,862 27,000 2,298
Senior Vice President 1998 245,634 61,999 16,766 30,000 2,173
1997 235,625 42,398 10,680 0 2,239
Donald E. Devine II (6) 1999 240,001 110,521 7,863 42,000 2,298
Vice President-Finance 1998 35,701 0 0 0 100,000
and Chief Financial Officer
Ward C. Belcher 1999 216,500 73,695 9,171 0 2,298
Vice President - 1998 213,750 53,972 8,437 15,000 2,173
Operations 1997 211,000 34,637 4,782 0 2,239
</TABLE>
(1) Salary includes amounts deferred pursuant to salary reduction elections
made under the Company's Deferred Savings and Investment Plan (a "401(k)
Plan") which did not have a Company matching contribution in the years
shown.
(2) See the discussion below under the caption "Annual Incentives".
(3) Includes only imputed income pursuant to the Internal Revenue Code of 1986
with respect to promissory notes without stated interest delivered in
partial payment for the purchase of Common Stock under the Employees' Stock
Purchase Plan. See the caption "Promissory Notes" below.
(4) Adjusted for the July 1, 1999, 3-for-1 stock split. For additional
information on the options granted in 1999, see the caption "Option Grants
in 1999" below.
(5) All Other Compensation includes the fair market value of shares allocated
in respect of the indicated years under the Company's ESOP. The 1998 amount
for Mr. Devine is a signing bonus.
(6) Mr. Devine commenced employment with the Company in November 1998.
EARLY RETIREMENT AGREEMENT
The Company entered into an early retirement agreement with Mr. Ward C.
Belcher who retired effective December 31, 1999. Under this agreement the
Company will continue to pay Mr. Ward C. Belcher his base salary at an annual
rate of $216,500 through November 30, 2001. His benefits under the Company's
welfare benefit plans will continue through that date or until he obtains
subsequent employment, if earlier. He will also accrue benefits under the
Company's Supplemental Executive Retirement Plan until November 19, 2001, at
which time he will attain the age of 55. Mr. Belcher will continue to be
eligible for 60% of his targeted award under the Company's Long-Term
Compensation Program. In addition, options that were granted in 1998 to Mr.
Belcher became vested and exercisable on December 31, 1999 under his early
retirement agreement.
In the event a Change in Control (as defined in the Senior Executive
Severance Protection Plan) occurs before December 1, 2001, pursuant to Mr.
Belcher's early retirement agreement, Mr. Belcher will be entitled to receive a
lump sum payment equal to $649,500 less the amount of base salary paid to him
since his retirement.
9
<PAGE>
REVISED RETIREMENT INCOME PLAN AND EXCESS BENEFIT PLAN
The following table shows, as of December 31, 1999, estimated annual
benefits payable upon retirement at age 65 under the Company's Revised
Retirement Income Plan (the "Retirement Plan") assuming that an employee would
be entitled to receive benefits under the Retirement Plan provisions which would
yield the largest benefit.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
HIGHEST AVERAGE YEARS OF CREDITED SERVICE
SALARY OVER -------------------------------------------------------------------------------
3 CONSECUTIVE YEARS 10 YEARS 20 YEARS 30 YEARS 35 YEARS 40 YEARS 45 YEARS
------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$200,000 28,134 56,268 84,402 98,468 113,468 128,468
250,000 35,634 71,268 106,902 124,718 143,468 162,218
300,000 43,134 86,268 129,402 150,968 173,468 195,968
350,000 50,634 101,268 151,902 177,218 203,468 229,718
400,000 58,134 116,268 174,402 203,468 233,468 263,468
450,000 65,634 131,268 196,902 229,718 263,468 297,218
500,000 73,134 146,268 219,402 255,968 293,468 330,968
550,000 80,634 161,268 241,902 282,218 323,468 364,718
600,000 88,134 176,268 264,402 308,468 353,468 398,468
650,000 95,634 191,268 286,902 334,718 383,468 432,218
700,000 103,134 206,268 309,402 360,968 413,468 465,968
</TABLE>
The maximum number of years of credited service under the Retirement
Plan is capped at 35 years except for employees hired prior to January 1, 1970.
Under the Company's Retirement Plan, which is a non-contributory,
qualified, defined benefit plan, the Company makes actuarially determined annual
contributions on behalf of most of its United States employees who have
completed at least one year of service with the Company. As of December 31,
1999, Messrs. Roob, Dupuy, Vail, Devine and W. C. Belcher had respectively 23,
23, 16, 1 and 28 years credited service under the Plan. The compensation covered
by the Retirement Plan is that described under the "Salary" column of the
Summary Compensation Table. Benefits shown in the Pension Plan Table are
computed on the basis of a straight life annuity and are not subject to offset
for Social Security. To the extent that an employee's retirement benefit as
computed in accordance with the Plan exceeds maximum amounts permitted under the
Internal Revenue Code of 1986, the difference will be paid by the Company under
the Company's unfunded Excess Benefit Plan approved by the Board of Directors
which provides a compensating non-qualified annual retirement supplement.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
In 1996 the Company established a non-qualified Supplemental Executive
Retirement Income Benefit Plan. This Plan is designed to equalize benefits for
certain senior executives. The Compensation Committee has been authorized to
select the participants in this Plan. Messrs. Roob, Dupuy and Vail are
participants and Mr. Ward C. Belcher is a participant from December 31, 1999
until November 19, 2001.
The following table shows, as of December 31, 1999, estimated annual
benefits payable upon retirement at age 65 under the Supplemental Executive
Retirement Income Benefit Plan.
10
<PAGE>
SUPPLEMENTAL EXECUTIVE RETIREMENT INCOME BENEFIT PLAN TABLE
-----------------------------------------------------------
<TABLE>
<CAPTION>
HIGHEST AVERAGE YEARS OF CREDITED SERVICE
SALARY OVER -------------------------------------------------------------
3 CONSECUTIVE YEARS 15 YEARS 20 YEARS 25 YEARS
------------------- -------- -------- --------
<S> <C> <C> <C>
$200,000 90,000 100,000 107,500
250,000 112,500 125,000 134,375
300,000 135,000 150,000 161,250
350,000 157,500 175,000 188,125
400,000 180,000 200,000 215,000
450,000 202,500 225,000 241,875
500,000 225,000 250,000 268,750
550,000 247,500 275,000 295,625
600,000 270,000 300,000 322,800
650,000 292,500 325,000 349,375
700,000 315,000 350,000 376,250
</TABLE>
The maximum number of years of credited service under the Supplemental
Executive Retirement Income Benefit Plan is 25 years. As of December 31, 1999,
Messrs. Roob, Dupuy and Vail had respectively 23, 23 and 16 years of credited
service. The compensation covered by this Plan is that described under the
"Salary" column of the Summary Compensation Table. Benefits shown in the
Supplemental Executive Retirement Income Benefit Plan Table are computed on the
basis of a straight life annuity and are subject to offset by the participant's
benefits under the Retirement Plan and the Excess Benefit Plan and the
participant's primary Social Security benefit. Upon a participant's termination
of employment following a change in control the benefit under this Plan will
become fully vested and the actuarial equivalent of the benefit will be paid
within 30 days in a lump sum.
PROMISSORY NOTES
The following officers and Directors of the Company were indebted to
the Company in amounts greater than $60,000 since January 1, 1999 under full
recourse promissory notes without stated interest delivered in partial payment
for the purchase of Common Stock of the Company under the Employees' Stock
Purchase Plan. One of the promissory notes bears interest at the rate of 5.5
percent per annum and it was given for the purchase of shares under the 1993
Stock Option Plan by Mr. Dupuy. In addition, Mr. Dupuy was also indebted to
Benjamin Moore & Co. under a full recourse promissory note without stated
interest given in connection with the purchase of Common Shares of Benjamin
Moore & Co., Limited on February 13, 1992. The highest amounts outstanding under
such notes for such persons since January 1, 1999 and the amounts outstanding at
March 3, 2000 were as follows:
<TABLE>
<CAPTION>
SINCE JANUARY 1, 1999 AT MARCH 3, 2000
--------------------- ----------------
WITH INTEREST WITHOUT INTEREST WITH INTEREST WITHOUT INTEREST
--------------------------------- ---------------------------------
<S> <C> <C> <C> <C>
Denis S. Abrams $-0- $373,148 $-0- $329,339
Ward C. Belcher -0- 116,400 -0- 104,431
Michael A. Bonner -0- 159,564 -0- 129,132
Donald E. Devine II -0- 194,266 -0- 177,930
Yvan Dupuy 73,260 236,242 64,074 193,808
James E. Henderson -0- 123,447 -0- 108,855
John T. Rafferty -0- 73,802 -0- 40,905
Ellen L. Singer -0- 116,400 -0- 103,382
Charles C. Vail -0- 264,462 -0- 227,032
Maurice C. Workman -0- 109,707 -0- 70,975
Bruce E. Zeh -0- 117,369 -0- 99,706
</TABLE>
11
<PAGE>
The foregoing amounts represent the aggregate principal balances
outstanding under the promissory notes. The purchase of the Company's Common
Stock generally occurred on (a) January 1, 1991, (b) May 27, 1994 and (c) May 8,
1998, at the then current fair value as determined in accordance with the terms
of the Employees' Stock Purchase Plan. As noted above, Mr. Dupuy also exercised
an option under the 1993 Stock Option Plan and purchased Common Shares of
Benjamin Moore & Co., Limited. All of the promissory notes are secured by the
shares to which they relate. On and after January 1, 1991, all purchases under
the Employees' Stock Purchase Plan under full recourse promissory notes have
been made without stated interest on the notes.
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The following persons, who are non-employee Directors, serve as members of
the Compensation Committee, which establishes the compensation of the Company's
senior executives named in the Summary Compensation Table above: Charles H.
Bergmann, Jr., Frederick J. Costello, Gerald W. Moore and Robert H. Mundheim.
This Committee was originally named the Compensation and Stock Option Plan
Committee and the name was changed to the Compensation Committee in September
1999; however, the members of this Committee were the same from 1999 to date.
None of the named members of this Committee has been at any time an officer or
employee of the Company or any of its subsidiaries. Shearman & Sterling, a law
firm, performed legal services for the Company in 1999 and may perform services
for the Company in 2000. Mr. Robert H. Mundheim currently is of counsel to
Shearman & Sterling.
REPORT ON EXECUTIVE COMPENSATION
The executive compensation program of the Company is administered by the
Compensation Committee of the Board of Directors. This Committee currently
consists of Charles H. Bergmann, Jr., Frederick J. Costello, Gerald W. Moore and
Robert H. Mundheim.
All compensation decisions of the Compensation Committee, including those
for the Chief Executive Officer, take into account individual services rendered,
level and scope of responsibility, experience, an evaluation of overall Company
performance, the need for motivation and retention of executives of outstanding
abilities, internal equity, and the requirement to be competitive. Additional
consideration is given to the compensation structures of corporations in the
same or similar lines of business as the Company as well as a number of those in
other lines of business. Survey data is used to assist in this evaluation.
Within this framework and with input from management, the Compensation Committee
makes a subjective judgment about the salary of the Chief Executive Officer and
the other senior executives of the Company.
BASE SALARY
The Company has a philosophy of providing a level of base compensation or
salary that allows the Company to attract, retain and reward the talent needed
to maintain its leading position in the coatings business. The Company carefully
reviews the performance of employees in determining annual compensation
increases. This performance evaluation is made by the various levels of
management. All compensation increases for the five senior executives of the
Company appearing in the Summary Compensation Table are reviewed and approved by
the Compensation Committee.
ANNUAL INCENTIVES
An annual incentive program was adopted by the Company effective January 1,
1993. It is intended to create a positive link between annual performance and
annual incentive compensation. The program has two broad components: a general
individual incentive portion and a management incentive plan. Incentive
12
<PAGE>
payments under the individual incentive portion of this program for 1999 were
made to those employees who were not participants in the management incentive
award program or the sales representative incentive program. For 1999 the
incentive payment threshold was the achievement of a specified level of increase
in net income and revenues of the Company. The Compensation Committee reviewed
and approved incentive opportunities for 1999 corresponding with the performance
required to achieve increasing levels of net income and revenues under the
Company's annual and strategic plan. Target incentive opportunities were
established under the individual incentive portion of this program as an
increasing percentage of base salary directly related to the level of increase
of net income and revenues. This opportunity was designed to foster a team based
approach to collaborative working decisions and individual as well as Company
achievement. Individual awards were made according to each employee's
performance against set goals.
The Compensation Committee decided that under the 1999 management incentive
award program incentive payments should be made for overall financial and
operating performance throughout the year. The amount of the payment under the
management incentive award program for each executive officer of the Company
named in the Summary Compensation Table was determined by the provisions of the
annual incentive program and was approved by the Compensation Committee. Since
an increase in net income and revenues was used to determine the amount of the
annual incentive, the program was positively correlated with the performance of
the Company. The incentive payment to the Chief Executive Officer, Richard Roob,
in 1999 reflects the fact that the actual financial results of the Company were
significantly higher in 1999 than 1998.
In addition, in recognition of the Company's outstanding performance in
1999, a special bonus amounting to the equivalent of two weeks' base salary was
paid at the end of January 2000 to all active, regular full-time and regular
part-time employees, including all of the Company's executive officers, who had
been with the Company for over one year and who were employed as of December 31,
1999.
LONG-TERM INCENTIVES
The Company's long-term incentive philosophy is that long-term incentives
should be related to increases in long-term shareholder value so as to create a
common interest among the Company, employees and shareholders. To further this
objective the Company provides a three component opportunity of long-term
incentives for many employees. The first is the opportunity to purchase Common
Stock through the Employees' Stock Purchase Plan. This Plan is generally
available to employees who have more than five years of service with the
Company. The second opportunity is through the ESOP. In 1999, all employees of
the Company with one year of service participated in this Plan. Lastly, the
Compensation Committee in 1998 approved the establishment of a long-term
compensation program for senior leadership and key management employees.
STOCK PURCHASES
An Employees' Stock Purchase Plan, which is administered by the Executive
and Finance Committee of the Board of Directors, was approved by the
shareholders of the Company on April 20, 1978. This was a continuation of the
original plan established in 1937. It permits the purchase of shares of Common
Stock at fair value. It is believed that stock ownership aligns the interests of
employees and shareholders of the Company. For a summary of the indebtedness to
the Company under this Plan of officers and Directors of the Company, see the
discussion above under the heading "Promissory Notes".
EMPLOYEES' STOCK OWNERSHIP PLAN
The Company has maintained an Employees' Stock Ownership Plan (the "ESOP")
which is a tax-qualified plan covering substantially all of its United States
employees. Under the terms of this Plan, the Board of Directors of the Company
is authorized to make contributions from time to time out of the profits or
retained earnings of the Company to the Plan Trust fund; such contributions to
be in an amount and in the form of cash or shares of Common Stock as determined
by the Board of Directors in its sole discretion. Contributions, which are
deductible expenses for income tax purposes, are allocated annually to the
participants in the Plan in the ratio that the eligible compensation of each
bears to the aggregate eligible compensation of all such
13
<PAGE>
participants. In 1999 the Company contributed to the Plan Trust fund an amount
necessary to complete the loan payment due on a loan made on June 30, 1989,
which was used to purchase shares for the ESOP. Effective December 31, 1999, the
Company merged the ESOP into its Deferred Savings and Investment Plan described
below.
DEFERRED SAVINGS AND INVESTMENT PLAN
This plan, which is a tax-qualified 401(k) plan covering substantially all
of the Company's United States employees, allows employees to elect to defer up
to 12% of their compensation, subject to the annual Internal Revenue Service
limits on employee salary reduction deferrals. Participants may choose among
several investment funds for their elective deferrals. Effective January 1,
2000, the Company will provide for a matching contribution in the form of Common
Stock equal to 50% of the elective deferrals up to 4% of the participant's
compensation for any participant employed on December 31 of a year starting
December 31, 2000. The Company will also contribute an amount equal to 1% of
compensation for 2000. These matching contributions are designed to replace
contributions previously made to the ESOP. The ESOP was merged with the Deferred
Savings and Investment Plan as of December 31, 1999. As a result, the Deferred
Savings and Investment Plan will be comprised of both a 401(k) portion and an
ESOP portion.
LONG-TERM COMPENSATION PROGRAM FOR SENIOR LEADERSHIP GROUP AND KEY MANAGEMENT
This program is a multiyear incentive program adopted in 1998 by the former
Compensation and Stock Option Plan Committee that targets the achievement of
four-year sales and net profit goals. The principal incentive feature is the
award of stock options by the Stock Option Committee to approximately 45 senior
managers, including the executive officers named in the Summary Compensation
Table. There is also a cash bonus feature which calls for a cash payment to
senior executives based upon cumulative sales and earnings over the four-year
period 1998 through 2001. It is designed to facilitate part of the cash
requirements needed by option holders to exercise their options.
The Compensation Committee believes stock options, which are granted by
the Stock Option Committee, encourage and reward efforts that result in
corporate financial success over the long term as measured by stock price
appreciation. Employees receiving grants benefit if shareholders benefit through
appreciation in the post-grant value of the shares of Common Stock. The 1993
Stock Option Plan of the Company was approved by the shareholders on April 15,
1993 and the 1998 Stock Incentive Plan was approved by the shareholders on April
16, 1998. Future grants may only be made under the 1998 Stock Incentive Plan.
POLICY REGARDING SECTION 162(M) OF THE INTERNAL REVENUE CODE
Section 162(m) of the Internal Revenue Code generally limits the corporate
deduction for compensation paid to an employee who on the last day of fiscal
years beginning on or after January 1, 1994 is either the chief executive
officer or among the four most highly compensated officers other than the chief
executive officer to $1 million, except for qualified performance-based
compensation. Options that have been granted under the Company's Stock Option
Plans are designed to qualify as performance-based compensation under
regulations issued by the Internal Revenue Service. The Compensation Committee
as a general rule intends to take such action as it deems appropriate to
preserve the tax deductibility of compensation paid by the Company to the extent
practicable and so long as this objective is consistent with providing fair,
competitive and rewarding compensation consistent with performance. In the case
of Mr. Roob it was the Compensation Committee's judgment that, notwithstanding
the limitation of Section 162 (m), his compensation was appropriate to his level
of responsibility within the Company, the Company's financial performance in
1999 and Mr. Roob's leadership.
14
<PAGE>
COMPENSATION COMMITTEE
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Charles H. Bergmann, Jr. Frederick J. Costello Gerald W. Moore Robert H. Mundheim
</TABLE>
OPTION GRANTS IN 1999
The following table shows all individual grants of stock options under the
Company's 1998 Stock Incentive Plan to the named executive officers of the
Company during calendar year 1999, which was the Company's fiscal year. The
Company has not granted any stock appreciation rights ("SARs"). These option
grants were made by the Stock Option Committee.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
NUMBER OF PERCENT OF VALUE AT ASSUMED
SECURITIES TOTAL OPTIONS ANNUAL RATES OF
UNDERLYING GRANTED TO EXERCISE OR STOCK PRICE APPRECIATION
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION FOR OPTION TERM (3)
NAME GRANTED (#)(1)FISCAL YEAR ($/SH) (2) DATE 5% 10%
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Richard Roob 54,000 14.5 28.00 3/5/2009 $952,560 $2,404,080
Yvan Dupuy 54,000 14.5 28.00 3/5/2009 952,560 2,404,080
Charles C. Vail 27,000 7.3 28.00 3/5/2009 476,280 1,202,040
Donald E. Devine II 15,000 4.0 27.86 1/25/2009 263,277 664,461
27,000 7.3 28.00 3/5/2009 476,280 1,202,040
Ward C. Belcher 0 0 0 0 0 0
</TABLE>
(1) The options were granted on March 5, 1999 (except for the 15,000 share
option grant to Mr. Devine which was made on January 25, 1999) and become
exercisable in four equal installments on each of the first, second, third
and fourth anniversaries of the date of the grant. In the event of a change
in control of the Company, all options outstanding as of such date shall
become immediately and fully exercisable. The number of shares reflect the
July 1, 1999, 3-for-1 stock split.
(2) The option exercise or base price per share is the fair value of a share of
Common Stock based on the valuation determined by Management Planning,
Inc., 101 Poor Farm Road, Princeton, New Jersey 08540, an independent
consulting firm retained since April 1988 to calculate the current fair
value of the Common Stock on a weekly basis.
(3) As required by the rules of the Securities and Exchange Commission,
potential values stated are based on the hypothetical assumption that the
Company's Common Stock will appreciate in value from the date of grant to
the end of the option term (ten years from the date of grant) at annualized
rates of 5% and 10% (total appreciation of 63% and 159%), respectively.
They are not intended to forecast future appreciation, if any, in the price
of the Company's Common Stock. The total of all stock options granted to
employees, including executive officers, during 1999 covering 372,300
shares was less than 1.4% of total shares outstanding at December 31, 1999.
For this reason, the potential realizable value of such options for all
optionees under the prescribed assumptions is less than 1.4% of the
potential realizable value of all shareholders for the same period under
the same assumptions.
LONG-TERM INCENTIVE PLAN - AWARDS
IN LAST FISCAL YEAR
There were no cash awards under the Company's Long-Term Compensation
Program in calendar year 1999, the last fiscal year. Awards made in 1998 are
dependent upon achievement of sales and net profit goals over the four-year
period from 1998 through 2001.
15
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
The following table provides information concerning option exercises in
the last fiscal year, which is calendar year 1999 and the value of unexercised
options held by the executive officers named in the Summary Compensation Table
at the end of the last fiscal year. The Company has not granted any SARs.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
SHARES UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
ACQUIRED OPTIONS AT IN-THE-MONEY OPTIONS
ON EXERCISE VALUE REALIZED FISCAL YEAR END (#) AT FISCAL YEAR END ($) (2)
NAME # ($) (1) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
----------------------- ---------------- ---------------- --------------------------- ----------------------------
<S> <C> <C> <C> <C> <C> <C>
Richard Roob 0 0 45,000 / 99,000 141,900 / 79,380
Yvan Dupuy 6,000 12,000 27,000 / 99,000 65,400 / 79,380
Charles C. Vail 0 0 25,500 / 49,500 83,700 / 39,690
Donald E.Devine II 0 0 0 / 42,000 0 / 30,240
Ward C. Belcher 0 0 33,000 / 0 90,900 / 0
</TABLE>
(1) The figures presented in this column have been calculated based upon the
difference between the fair value of a share of Common Stock as determined
by Management Planning, Inc. on the date of exercise and its exercise
price.
(2) Values stated are based on the difference between the option exercise or
base price per share and the fair value of a share of Common Stock on
December 31, 1999 of $28.67 per share, as determined by Management
Planning, Inc., multiplied by the number of in-the-money options
outstanding. Such price as of March 3, 2000 was also $28.67 per share.
SEVERANCE ARRANGEMENTS
The Company has adopted a Senior Executive Severance Protection Plan
(the "Severance Plan') covering designated employees of the Company (including
each of the executive officers appearing in the Summary Compensation Table).
Under the Severance Plan, a covered executive will be entitled to specified
severance benefits if he or she is terminated within two years after a Change in
Control (as defined in the Severance Plan) by the Company other than for Cause
(as defined in the Severance Plan) or by the executive for Good Reason (as
defined in the Severance Plan but generally including an adverse change in the
executive's position, a reduction in salary or certain benefits or a relocation
of the Company's offices more than 25 miles.) The severance benefits include a
lump sum equal to three times the executive's base salary, a pro-rata annual
bonus for the year in which the termination occurs and the continuation of
certain health and welfare benefits for three years following termination. The
Severance Plan was amended in 1999 to provide that additional payments will be
made to terminated participants following a Change in Control of the Company if
the participant's severance benefits are subjected to adverse excise tax under
Section 4999 of the Internal Revenue Code of 1986. However, where a severance
payment reduction of less than $25,000 would eliminate the excise tax on Change
in Control related payments to the participant, the severance benefits would be
reduced so that there would be no excise tax payment.
PERFORMANCE GRAPH
The following line graph compares the Company's cumulative total
shareholder return on its Common Stock with the cumulative total return of (i)
the Standard & Poor's 500 Stock Index which is a broad based widely used index
useful for comparison purposes and (ii) a Peer Group of five publicly traded
companies in the coatings business. The companies in the Peer Group are Lilly
Industries, Inc., Pratt & Lambert United, Inc. through 1995 since it was
acquired by The Sherwin-Williams Company in January 1996, RPM, Inc., The
16
<PAGE>
Sherwin-Williams Company and The Valspar Corporation. All returns assume that
$100 was invested on December 31, 1994 and that all dividends were reinvested,
and all returns are weighted on the basis of market capitalization at the
beginning of each year of measurement. The stock prices for the Common Stock of
Benjamin Moore & Co. are the fair values as determined by Management Planning,
Inc.
[GRAPHIC OMITTED]
BASE
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
Benjamin Moore & Co. 100 105.05 82.28 121.95 140.31 164.44
S&P 500 Comp 100 137.58 169.17 225.60 290.08 351.12
Peer Group 100 124.19 162.90 172.57 187.97 147.79
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Company, acting upon the recommendation of
the Audit Committee, has selected Deloitte & Touche LLP as the independent
public accountants for the Company in 2000. Deloitte & Touche LLP and its
predecessors, Deloitte Haskins and Sells and Haskins & Sells, have acted in such
capacity since 1957. A representative of Deloitte & Touche LLP is expected to be
present at the Meeting. The representative will have an opportunity to make a
statement and will be available to respond to appropriate questions.
MISCELLANEOUS
SHAREHOLDER PROPOSAL DATE
Any shareholder proposal intended to be presented at the 2001 Annual
Meeting of Shareholders must be received by the Company, directed to the
attention of the Secretary, at its principal executive offices at 51 Chestnut
Ridge Road, Montvale, New Jersey 07645 not later than November 27, 2000 to be
considered for inclusion in the Company's Proxy Statement and form of proxy
relating to the year 2001 Annual Meeting. Any such proposals must comply in all
respects with the rules and regulations of the Securities and Exchange
Commission.
17
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and Directors, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file
reports of ownership with the Securities and Exchange Commission. Executive
officers, Directors and greater than ten-percent shareholders are required by
Securities and Exchange Commission regulations to furnish the Company with
copies of all Section 16(a) forms they file.
Based on review of the copies of such forms furnished to the Company, the
Company believes that during the year 1999 all Section 16(a) filing requirements
applicable to its executive officers, Directors and greater than ten-percent
beneficial owners were met except that Mrs. Sara B. Wardell did not file a
timely Form 4 reporting a total of 600 shares of Common Stock purchased by her
husband.
AVAILABILITY OF FORM 10-K REPORT
UPON WRITTEN REQUEST, THE COMPANY WILL FURNISH, WITHOUT CHARGE, A COPY OF
ITS FORM 10-K ANNUAL REPORT FOR 1999, AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, TO ANY PERSON WHO, AS OF THE CLOSE OF BUSINESS ON MARCH 3, 2000,
EITHER HELD SHARES OF THE COMPANY IN HIS OR HER OWN NAME OR WAS THE BENEFICIAL
OWNER OF SHARES HELD IN THE NAME OF ANOTHER PERSON. SUCH SHAREHOLDERS MUST MAKE
SUCH REQUESTS TO THE SECRETARY, BENJAMIN MOORE & CO., 51 CHESTNUT RIDGE ROAD,
MONTVALE, NEW JERSEY 07645. OWNERS OF SHARES HELD IN THE NAME OF ANOTHER PERSON
MUST INCLUDE IN THEIR REQUESTS A REPRESENTATION THAT THEY WERE BENEFICIAL OWNERS
OF SHARES OF BENJAMIN MOORE & CO. AS OF THE CLOSE OF BUSINESS ON MARCH 3, 2000.
By Order Of The Board of Directors
John T. Rafferty
Dated: March 27, 2000 SECRETARY
18
<PAGE>
BENJAMIN MOORE & CO. - PROXY
51 CHESTNUT RIDGE ROAD, MONTVALE, NJ 07645
------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Benjamin M. Belcher, Jr., Yvan Dupuy and Richard
Roob as proxies to vote all shares of the undersigned at the Annual Meeting of
Shareholders to be held April 27, 2000. Each of the named proxies shall have the
power to appoint a substitute proxy for himself. The proxies, or any one of
them, shall have the power to vote: (i) only those shares of the Common Stock of
Benjamin Moore & Co. held of record by the undersigned as of the close of
business on March 3, 2000; (ii) at any adjournment or postponement of the
meeting; and (iii) upon any subject which may properly be brought before the
meeting. The proxies may vote upon all the matters described in the proxy
statement furnished with this proxy, subject to any directions indicated below.
IF NO DIRECTIONS ARE GIVEN, THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF THE
NOMINEES LISTED BELOW.
1. Election of one (1) Class I Director and three (3) Class III Directors:
FOR all nominees listed below WITHHOLD AUTHORITY to vote
(except as written below) / / for all nominees listed below / /
Ward C. Belcher (Class I) Frederick J. Costello (Class III) John C. Moore,
Jr. (Class III) Richard Roob (Class III)
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
----------------------------------------------------------------------
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly be brought before the meeting, or any adjournment
or postponement thereof.
PLEASE MARK, DATE, SIGN AND RETURN PROMPTLY
Dated:______________________________________, 2000
__________________________________________________
__________________________________________________
The signature(s) should agree with the name(s)
imprinted to the left. Custodians, Executors,
Administrators, Trustees, Guardians and Attorneys
should so indicate when signing.
Number of Shares held on record date:_____________
<PAGE>
BENJAMIN MOORE & CO. - VOTING INSTRUCTIONS
51 CHESTNUT RIDGE ROAD, MONTVALE, NJ 07645
____________________________________
DEFERRED SAVINGS AND INVESTMENT PLAN
THESE INSTRUCTIONS ARE SOLICITED BY THE ADMINISTRATIVE COMMITTEE
AND THE TRUSTEES OF THE
BENJAMIN MOORE & CO. DEFERRED SAVINGS AND INVESTMENT PLAN
Pursuant to Section 9.01 of the Benjamin Moore & Co. Deferred Savings and
Investment Plan (the "Plan"), the undersigned hereby instructs the
Administrative Committee and the Trustees of the Plan, and each or any of them,
to vote as designated below, all shares of Common Stock of Benjamin Moore & Co.
held in the account of the undersigned under the Plan as of the close of
business on March 3, 2000, at the Annual Meeting of Shareholders to be held on
April 27, 2000 or any adjournment or postponement thereof. These instructions
when properly executed will be followed in the manner directed.
IF NO INSTRUCTIONS ARE GIVEN ON THIS FORM OR IF THE FORM IS NOT RETURNED, ALL
SHARES OF COMMON STOCK HELD IN YOUR ACCOUNT UNDER THE PLAN WILL BE VOTED IN THE
ELECTION OF DIRECTORS AND ON ANY OTHER PROPOSALS BEFORE THE MEETING IN THE SAME
PROPORTION AS SHARES FOR WHICH INSTRUCTIONS HAVE BEEN RECEIVED FROM PARTICIPANTS
IN THE PLAN. IF AUTHORITY TO VOTE FOR ONE OR MORE NOMINEES IS WITHHELD, THE
SHARES OF COMMON STOCK HELD IN YOUR ACCOUNT UNDER THE PLAN WILL BE VOTED ONLY
FOR THE BALANCE OF SUCH NOMINEES, IF ANY.
1. Election of one (1) Class I Director and three (3) Class III Directors:
FOR all nominees listed below WITHHOLD AUTHORITY to vote
(except as written below) / / for all nominees listed below / /
Ward C. Belcher (Class I) Frederick J. Costello (Class III) John C. Moore,
Jr. (Class III) Richard Roob (Class III)
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
----------------------------------------------------------------------
2. In their discretion, the Administrative Committee and the Trustees are
authorized to vote upon such other business as may properly be brought
before the meeting, or any adjournment or postponement thereof.
PLEASE MARK, DATE, SIGN AND RETURN PROMPTLY
__________________________________________________
Dated:______________________________________, 2000
The signature should agree with the name imprinted
to the left.
