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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE
ACT OF 1934
(AMENDMENT NO.)
Filed by the registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
E. I. du Pont de Nemours and Company
(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(l)(1), or
14a-6(j)(2).
[_] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(l)(4) and
0-11
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) For unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11*
(4) Proposed maximum aggregate value of transaction:
---------
*Set forth the amount on which the filing is calculated and state how it
was determined.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing fee which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amounts previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
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DuPont
1007 Market Street
Wilmington, DE 19898
[LOGO APPEARS HERE] EDGAR S. WOOLARD, JR.
Chairman of the Board
ANNUAL MEETING--APRIL 27, 1994
March 18, 1994
Dear Stockholder:
You are invited to attend the Company's 1994 Annual Meeting on Wednesday,
April 27, 1994, at 10:30 a.m. in The Playhouse Theatre, DuPont Building,
Wilmington, Delaware.
The enclosed Notice of Annual Meeting and Proxy Statement describe the
various matters to be acted upon during the meeting. In addition, there
will be a report on the state of the Company's business and an opportunity
for you to express your views on subjects related to the Company's
operations.
To obtain a ticket, please check the appropriate box on the enclosed proxy.
Please include information on any accommodation you may need because of a
disability. Because seating capacity is limited, we suggest that you arrive
as close as possible to 9:30 a.m., when The Playhouse opens. If The
Playhouse is filled, there will be additional seating available in nearby
rooms where television monitors will be provided.
If you are unable to attend this year's meeting, you can ensure your
representation by completing the enclosed proxy and returning it in the
postage-paid envelope.
The Annual Meeting gives us an opportunity to review results and discuss
the steps the Company is taking to assure a strong performance in the
future. Your interest in the Company is much appreciated, and I hope you
will be able to join us as we talk about these matters on April 27.
Sincerely,
(SIGNATURE OF
EDGAR S. WOOLARD, JR.
APPEARS HERE)
Edgar S. Woolard, Jr.
E. I. du Pont de Nemours and Company [RECYCLED PAPER LOGO APPEARS HERE]
Printed on recycled paper.
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March 18, 1994
To the Holders of Common Stock of
E. I. du Pont de Nemours and Company
NOTICE OF ANNUAL MEETING
The Annual Meeting of Stockholders of E. I. DU PONT DE NEMOURS AND COMPANY
will be held on Wednesday, APRIL 27, 1994, at 10:30 a.m. local time, in The
Playhouse Theatre in the DuPont Building, 1007 Market Street, Wilmington,
Delaware. The meeting will be held to consider and act upon the election of
directors, ratification of independent accountants, management proposal on
amendment of the Stock Performance Plan, shareholder proposals described in the
Proxy Statement and such other business as may properly come before the
meeting.
Holders of record of DuPont Common Stock at the close of business on March 1,
1994, are entitled to vote at the meeting.
This notice and the accompanying proxy material are sent to you by order of
the Board of Directors.
Louise B. Lancaster
Secretary
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. WHETHER OR NOT
YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE AND RETURN THE PROXY IN THE
ENCLOSED ENVELOPE AS SOON AS POSSIBLE.
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PROXY STATEMENT
March 18, 1994
The enclosed proxy is being solicited by order of the Board of Directors of
E. I. du Pont de Nemours and Company for use in connection with the Annual
Meeting of Stockholders to be held April 27, 1994.
The record date with respect to this solicitation is March 1, 1994. All
holders of record of DuPont Common Stock as of the close of business on that
date are entitled to vote at the meeting. As of that date the Company had
678,703,215 shares of common stock outstanding. Each share of stock is entitled
to one vote. A favorable vote of a majority of the shares of common stock voted
in person or by proxy at the meeting is required for the approval of each of
the proposals described in this Proxy Statement. Abstentions and broker non-
votes are not counted in the calculation of the vote, except that abstentions
will be counted and have the same effect as votes against Proposal Number 3. A
proxy may be revoked by the stockholder at any time prior to its being voted.
If a proxy is properly signed and is not revoked by the stockholder, the shares
it represents will be voted at the meeting in accordance with the instructions
of the stockholder. If the proxy is signed and returned without specifying
choices, the shares will be voted in accordance with the recommendations of the
Board of Directors.
The enclosed proxy also serves as the voting instruction card for the
trustees who hold shares of record for participants in the DuPont Savings and
Investment Plan, the Conoco Thrift Plan, the Investment Plan for Salaried
Employees of Consolidation Coal Company, the DuPont Tax Reform Act Stock
Ownership Plan and the Conoco Employee Stock Ownership Plan. If proxies
representing shares in the employee savings plans listed above are not
returned, those shares will be voted at the discretion of a trustee. Shares in
the employee stock ownership plans cannot be voted unless the proxy is signed
and returned.
The Company's Annual Report to Stockholders, containing financial statements
reflecting the financial position and results of the operations of the Company
for 1993, and this Proxy Statement were distributed together beginning March
18, 1994.
GENERAL INFORMATION
PROXY STATEMENT PROPOSALS. Each year the Board of Directors submits to the
stockholders at the annual meeting its nominations for election of directors.
In addition, the Bylaws of the Company require that the selection of
independent accountants by the Audit Committee of the Board of Directors be
submitted for stockholder ratification at each annual meeting. Other proposals
may be submitted by the Board of Directors or stockholders for inclusion in the
proxy statement for action at the annual meeting. Any proposal submitted by a
stockholder for inclusion in the 1995 Annual Meeting Proxy Statement must be
received by the Company no later than November 18, 1994.
STOCKHOLDER NOMINATIONS FOR ELECTION OF DIRECTORS. The Strategic Direction
Committee recommends to the Board of Directors nominees for election as
directors at the annual meeting. In making such recommendations, the Strategic
Direction Committee will consider nominations submitted by stockholders. Any
such nominations must be made by stockholders of record and received by the
Secretary of the Company by the first Monday in December. Nominations must be
accompanied by a statement of the nominee indicating willingness to serve if
elected and disclosing principal occupations or employments held over the past
five years.
PROXY COMMITTEE. The Proxy Committee is composed of directors of the Company
who vote as instructed the shares of DuPont Common Stock for which they receive
proxies. Proxy cards also confer upon the Proxy Committee discretionary
authority to vote the shares on any matter which was not known to the Board of
Directors a reasonable time before solicitation of proxies, but which is
properly presented for action at the meeting.
PROXY SOLICITATION. All costs relating to the solicitation of proxies will be
borne by the Company. Morrow & Co. has been retained by the Company to aid in
the solicitation of proxies, at an estimated cost of $9,500 plus reimbursement
of out-of-pocket expenses. Proxies may also be solicited by officers, directors
and
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employees of the Company personally or by mail, telephone or facsimile
transmission. On request, the Company will pay brokers and other persons
holding shares of stock in their names or in those of their nominees for their
reasonable expenses in sending soliciting material to, and seeking instructions
from, their principals.
SECRECY IN VOTING. As a matter of policy, proxies, ballots and voting
tabulations that identify individual stockholders are held confidential by the
Company. Such documents are available for examination only by the inspectors of
election, none of whom is an employee of the Company, and certain employees
associated with tabulation of the vote. The identity of the vote of any
stockholder is not disclosed except as may be necessary to meet legal
requirements.
THE BOARD OF DIRECTORS
OPERATION AND MEETINGS. The Board of Directors is responsible for broad
corporate policy and the overall performance of the Company. Members of the
Board are kept informed of the Company's business by various documents sent to
them before each meeting and oral reports made to them during these meetings by
the Chairman, Vice Chairmen and other corporate executives. They are advised of
actions taken by the Audit, Compensation and Benefits, Environmental Policy and
Strategic Direction Committees and the Office of the Chairman. In addition, the
directors receive written reports from the businesses when they propose actions
for Board approval. Directors have access to all books, records and reports,
and members of management are available at all times to answer their questions.
In 1993 nine meetings of the Board of Directors were held. Each director
attended 75% or more of the aggregate number of meetings of the Board and the
committees of the Board on which such director served. Attendance at these
meetings averaged 93% among all directors in 1993. Directors discharge their
responsibilities not only by attending Board and committee meetings but also
through communication with the Chairman and other members of management
relative to matters of mutual interest and concern to the Company.
RETIREMENT POLICY. The Company's retirement policy for directors provides that
no director may stand for reelection to the Board after reaching age 70. All
employee directors retire from the Board when they retire from employment with
the Company with the exception of former Chief Executive Officers. The Board at
its discretion may in unusual circumstances, and for a limited period, ask a
Board member to stand for reelection after the prescribed retirement date.
COMPENSATION. Members of the Board who are employees of DuPont or any of its
subsidiaries are not compensated for service on the Board or on committees. All
nonemployee directors receive an annual retainer fee of $35,000 for service on
the Board, and a fee of $1,000 per meeting for attending special meetings of
the Board and stockholder meetings held on a day when the Board does not meet.
Directors who are not employees receive the following: (a) committee chairmen
receive $15,000, (b) members of the Strategic Direction Committee receive
$15,000 and (c) members of the other Board committees receive $6,000. H. W.
Johnson and E. M. Bronfman receive an annual supplement of $25,000 and $20,800,
respectively. Pursuant to a consulting agreement, A.F. Brimmer receives $57,900
annually for providing economic advice to the Board. In 1993, E. P. Blanchard,
Jr., received $75,000 for services in connection with the Benlate (R) DF 50
fungicide litigation.
Under the terms of the Deferred Compensation Plan for Directors, any director
may defer all or part of the payment of Board and committee fees in the form of
cash or stock units until a specified year or until ceasing to be a director of
the Company. Interest equivalents accrue on payments deferred in the form of
cash and dividend equivalents accrue on payments deferred in the form of stock
units. Five directors have elected to defer payment of directors' fees in 1994.
Nonemployee directors are also eligible to participate in a retirement income
plan if on the date of retirement from the Board they have served on the Board
for at least five years and have not qualified for an immediate or deferred
pension benefit from the Company or any of its subsidiaries. The annual
benefits payable under the plan are equal to one-half of the annual Board
retainer (exclusive of any committee compensation) in effect on the date of the
director's retirement. Benefits are available for the lesser of life or 10
years.
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The Directors' Charitable Gift Plan was established to improve the
competitiveness of the compensation and benefits package for Board members.
After a director's death, the Company will donate five consecutive annual
installments up to $200,000 each to tax-exempt educational institutions or
charitable organizations recommended by the director and approved by the
Company. A director will be fully vested in the Plan upon completion of five
years of service as a director or upon death or disability. The Plan is
unfunded. The Company may fund the Plan through, among other vehicles, the
purchase of life insurance policies on the lives of directors, and the Company
would own and be the beneficiary of the policies. Directors derive no personal
financial or tax benefit from the Plan because the charitable, tax deductible
donations and insurance proceeds, if any, accrue solely to the benefit of the
Company. Employee directors may elect to participate in the Plan provided they
bear their allocable cost.
OFFICE OF THE CHAIRMAN. The Office of the Chairman has responsibility for the
strategic direction and operations of all the businesses of the Company,
including corporate financial performance, environmental leadership and safety,
and development of global talent. All five members are employees and three are
directors. Its members include the Chairman, the Vice Chairmen, the Senior Vice
President--DuPont Finance and the Senior Vice President--DuPont Human
Resources. The Office of the Chairman works in close coordination with the
executive officers of the Company who constitute the Operating Group. Together,
the Office of the Chairman and the Operating Group have broad corporate
responsibility for such areas as research and development, marketing,
manufacturing, global effectiveness and valuing people.
STRATEGIC DIRECTION COMMITTEE. The Strategic Direction Committee, which
consists of nine directors, is responsible for reviewing the strategic
direction of the Company's major business segments. The Committee approves
targets for Company debt and capitalization and also makes recommendations to
the Board on the payment of dividends. The Strategic Direction Committee also
has responsibility for recommending to the Board nominees for election as
directors at the annual meeting or between annual meetings. During 1993, the
Strategic Direction Committee held four meetings.
ENVIRONMENTAL POLICY COMMITTEE. The Environmental Policy Committee is
responsible for reviewing the Company's environmental policies and practices.
The Committee also provides support for the Company's leadership role in
corporate environmentalism. The Environmental Policy Committee, which consists
of eight directors, held four meetings in 1993.
AUDIT COMMITTEE. The Audit Committee, which consists of six directors, employs
independent accountants, subject to stockholder ratification, to audit the
Company's financial statements and to perform other assigned duties. The
Committee also requests the Company's subsidiaries to engage independent
accountants, as the Committee deems appropriate, to audit their respective
financial statements. Further, the Committee provides general oversight with
respect to the accounting principles employed in financial reporting and the
adequacy of the Company's internal accounting controls. No member of the Audit
Committee may be an officer or employee of the Company or any subsidiary or
affiliated company. During 1993, the Audit Committee held four meetings.
COMPENSATION AND BENEFITS COMMITTEE. The Compensation and Benefits Committee,
which consists of five directors, is responsible for establishing an executive
compensation policy consistent with corporate objectives and stockholder
interests. The Committee has responsibility for recommending to the Board
levels of compensation, including salaries as well as variable compensation and
stock options, for the Chairman and the Vice Chairmen. The Compensation and
Benefits Committee also administers grants under the Company's compensation
plans and approves the investment and funding policies of the DuPont Pension
Trust Fund. During 1993, the Compensation and Benefits Committee held six
meetings.
COMPENSATION AND BENEFITS COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. The
membership of the Compensation and Benefits Committee includes J. L. Weinberg,
E. M. Bronfman, R. E. Heckert, H. W. Johnson and H. R. Sharp, III. R. E.
Heckert is a former Chairman of the Board and Chief Executive Officer of the
Company and also serves as a director and chairman of the compensation
committee of The Seagram Company Ltd. E. S. Woolard, Jr., also serves as a
Seagram director and E. M. Bronfman is Seagram's Chairman of the Board and
Chief Executive Officer. The relationship between DuPont and Seagram is more
fully described at Note A on page 8 of this Proxy Statement.
3
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1--ELECTION OF DIRECTORS
The 16 nominees for election as directors are identified on pages 4 through
7. All nominees are now members of the Board of Directors. Elwood P. Blanchard,
Jr., Richard E. Heckert, Howard W. Johnson and E. Leo Kolber will retire from
the Board effective April 27, 1994. The Board knows of no reason why any
nominee would be unable to serve as a director. If any nominee should for any
reason become unable to serve, the shares represented by all valid proxies will
be voted for the election of such other person as the Board of Directors may
designate following recommendation by the Strategic Direction Committee, or the
Board may reduce the number of directors to eliminate the vacancy.
The following material contains information concerning the nominees,
including their recent employments, positions with the Company, other
directorships, and age as of the date of the 1994 Annual Meeting.
(PHOTO) PERCY N. BARNEVIK
Director since 1991 Member, Strategic
Age 53 Direction Committee
Mr. Barnevik is President and Chief Executive Officer of ABB
Asea Brown Boveri Ltd., headquartered in Zurich, Switzerland,
a company serving electric power generation, transmission and
distribution customers as well as industrial, environmental
control and mass transit markets. He is a director of In-
vestor AB and non-executive chairman of the boards of Sandvik
AB and Skanska AB.
(PHOTO) ANDREW F. BRIMMER
Director since 1974 Chairman, Audit Committee
Age 67
Dr. Brimmer is President and a director of Brimmer & Company,
Inc., a Washington, D.C.-based economic and financial con-
sulting firm. He was a visiting professor at the Harvard
Business School and a member of the Board of Governors of the
Federal Reserve System. He is a director of BankAmerica Cor-
poration, BellSouth Corporation, BlackRock Investment Income
Trust, Connecticut Mutual Life Insurance Company, Gannett
Company, Inc., Navistar International Corporation, PHH Corpo-
ration and UAL Corporation. He serves as chairman of the
Board of Trustees of Tuskegee University and as a trustee of
The College Retirement Equities Fund. He is a member of the
Council on Foreign Relations.
(PHOTO) CHARLES R. BRONFMAN, P.C., C.C.
Director since 1981 Member, Strategic Direction and
Age 62 Environmental Policy Committees
Mr. Bronfman is Co-Chairman of the Board and Chairman of the
Executive Committee of The Seagram Company Ltd., the princi-
pal business of which is the production and marketing of dis-
tilled spirits, wines, coolers, fruit juices and mixers. He
is also a director of Power Corporation of Canada, chairman
of the CRB Foundation, a major Canadian charitable founda-
tion, and chairman and director of Claridge Israel. Mr.
Bronfman serves on the boards of a wide range of civic and
philanthropic enterprises, both in Canada and international-
ly, in addition to being honorary president of the United Is-
rael Appeal of Canada and a director of the Canadian Council
of Christians and Jews. (See Notes A and B)
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(PHOTO) EDGAR M. BRONFMAN
Director since 1981 Member, Strategic Direction and
Age 64 Compensation and Benefits Committees
Mr. Bronfman is Chairman of the Board and Chief Executive Of-
ficer of The Seagram Company Ltd., the principal business of
which is the production and marketing of distilled spirits,
wines, coolers, fruit juices and mixers. He is president of
the World Jewish Congress, a director of the American Commit-
tee of the Weizmann Institute of Science and a member of the
International Advisory Board of the School of International
and Public Affairs of Columbia University. (See Notes A and
B)
(PHOTO) EDGAR BRONFMAN, JR.
Director since 1991 Member, Environmental
Age 38 Policy and Audit Committees
Mr. Bronfman is President and Chief Operating Officer of The
Seagram Company Ltd., the principal business of which is the
production and marketing of distilled spirits, wines, cool-
ers, fruit juices and mixers. He is a former executive vice
president, U.S. Operations, of The Seagram Company Ltd. and a
former president of The House of Seagram. Mr. Bronfman is
also a director of The Seagram Company Ltd. He is a member of
the boards of the New York Public Library, New York Univer-
sity Medical Center, the Teamwork Foundation, WNET/Thirteen
and serves on the Board of Governors of The Joseph H. Lauder
Institute of Management & International Studies at the Uni-
versity of Pennsylvania. (See Notes A and B)
(PHOTO) LOUISA C. DUEMLING
Director since 1982 Member, Environmental
Age 58 Policy Committee
Mrs. Duemling is a trustee of the Nature Conservancy, Winter-
thur Museum and Gardens and the Chesapeake Bay Foundation.
(PHOTO) EDWARD B. DU PONT
Director since 1978 Member, Audit Committee
Age 60
Mr. du Pont is a former chairman of Atlantic Aviation Corpo-
ration, the principal business of which is the charter, com-
pletion, storage, operation and maintenance of aircraft. He
is a former vice president of Wilmington Trust Company. He
serves as a director of Atlantic Aviation Corporation and
Wilmington Trust Company, treasurer and a director of the
Medical Center of Delaware, president and a trustee of
Eleutherian Mills--Hagley Foundation, and vice president and
a trustee of Longwood Foundation, Inc.
(PHOTO) CHARLES M. HARPER
Director since 1992 Member, Strategic
Age 66 Direction Committee
Mr. Harper is Chairman and Chief Executive Officer of RJR Na-
bisco Holdings, Corp., a food and tobacco company. He is a
director and former chairman and chief executive officer of
ConAgra, Inc., and a director of Norwest Corporation, Peter
Kiewit Sons', Inc., and Valmont Industries Inc.
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(PHOTO) JOHN A. KROL
Director since 1992 Member, Strategic Direction and
Age 57 Environmental Policy Committees
A Vice Chairman of the Board, Mr. Krol is a former senior
vice president of DuPont Fibers and senior vice president of
DuPont Agricultural Products. He is a director of the Na-
tional Association of Manufacturers and Elwyn Institute for
the Handicapped. Mr. Krol is also a trustee of Eleutherian
Mills--Hagley Foundation, Tufts University and the United
States Council for International Business.
(PHOTO) MARGARET P. MACKIMM
Director since 1979 Member, Audit Committee
Age 60
Mrs. MacKimm is a former senior vice president--Communica-
tions of Kraft General Foods, Inc., the principal business of
which is food processing, and a former vice president of Pub-
lic Affairs of Dart & Kraft, Inc. She is a director of Chi-
cago Title and Trust Company, Woolworth Corporation and the
World Press Institute. She is a member of the Executive Com-
mittee of the Chicago Community Trust and a director of the
North Shore Senior Center of Chicago.
(PHOTO) CONSTANTINE S. NICANDROS
Director since 1983 Member, Strategic
Age 60 Direction Committee
A Vice Chairman of the Board, Mr. Nicandros is also President
and Chief Executive Officer of Conoco. He is a former presi-
dent--Petroleum Operations of Conoco. Mr. Nicandros is a di-
rector of the American Petroleum Institute, Cooper Industries
and Texas Commerce Bancshares, Inc., and a member of the Na-
tional Petroleum Council. Mr. Nicandros is a trustee of the
Baylor College of Medicine, the Houston Ballet Foundation and
the Museum of Fine Arts--Houston. He serves on the Advisory
Board for the Texas Center for Superconductivity at the Uni-
versity of Houston. He is chairman and a director of the
Houston Grand Opera and is also a director of the Houston
Symphony Society, the Greater Houston Partnership and the
Texas Research League.
(PHOTO) WILLIAM K. REILLY
Director since 1993 Member, Environmental
Age 54 Policy Committee
Mr. Reilly is Payne Visiting Professor at Stanford Universi-
ty. He is a former administrator of the United States Envi-
ronmental Protection Agency and a former president of World
Wildlife Fund and The Conservation Foundation. Mr. Reilly is
Chairman of Clean Sites, Inc., and a director of Evergreen
Inc., The National Geographic Society and World Wildlife
Fund. He also serves on the board of the Inter-American Foun-
dation, the American Farmland Trust and the German Marshall
Fund of the United States.
6
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(PHOTO) H. RODNEY SHARP, III
Director since 1981 Member, Audit and Compensation
Age 58 and Benefits Committees
Mr. Sharp served as manager of Computer Systems of DuPont In-
formation Systems. He is president of the Board of Trustees
of Longwood Foundation, Inc., and serves as a trustee of St.
Augustine's College (Raleigh, North Carolina) and the Univer-
sity of Delaware Research Foundation. Mr. Sharp is also a di-
rector of the Medical Center of Delaware Foundation, Commu-
nity Housing, Inc., Planned Parenthood of Delaware, Grand
Opera House, Inc. and the YMCA of Delaware.
(PHOTO) CHARLES M. VEST
Director since 1993 Member, Environmental
Age 52 Policy Committee
Mr. Vest is President of the Corporation of the Massachusetts
Institute of Technology. He is a former provost and vice
president of Academic Affairs and dean of Engineering of the
University of Michigan. Mr. Vest is a member of the Corpora-
tion of the Woods Hole Oceanographic Institution and a
trustee of the Environmental Research Institute of Michigan,
the Boston Museum of Science and Wellesley College.
(PHOTO) JOHN L. WEINBERG
Director since 1986 Chairman, Compensation
Age 69 and Benefits Committee
Mr. Weinberg is Senior Chairman of Goldman, Sachs & Co., an
investment banking firm. He is a former senior partner and
chairman of the Management Committee and a former general
partner of that firm. He is a director of The B. F. Goodrich
Co., Capital Holding Corporation, Champion International Cor-
poration, Knight-Ridder, Inc., and The Seagram Company Ltd.
Mr. Weinberg is also Governor and member of the Executive
Committee of the New York Hospital--Cornell Medical Center
and a member of the Council on Foreign Relations. Mr. Wein-
berg is a Charter Trustee of Princeton University and a mem-
ber of The Business Council. (See Note A)
(PHOTO) EDGAR S. WOOLARD, JR.
Director since 1983 Chairman, Strategic
Age 60 Direction Committee
Chairman of the Board and Chief Executive Officer since 1989,
Mr. Woolard is a former president and chief operating offi-
cer, vice chairman, executive vice president and vice presi-
dent of the Textile Fibers Department. He is a director of
Citicorp, International Business Machines Corporation and The
Seagram Company Ltd. He is also a director of the National
Council on Economic Education and a trustee of North Carolina
State University, Protestant Episcopal Theological Seminary
and the Winterthur Museum and Gardens. (See Note A)
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- --------
(A) In 1986, DuPont and The Seagram Company Ltd. entered into an extension and
amendment of their 1981 agreement relating to the future relationship between
DuPont and Seagram. The amended agreement extends Seagram's obligation not to
exceed a 25 percent holding of DuPont voting securities and the DuPont right of
first refusal in the event Seagram offers such DuPont securities for sale. The
amended agreement continues indefinitely but can be terminated by either party
on or after April 2, 1999 upon two years' prior written notice. Furthermore,
Seagram may terminate the amended agreement should DuPont issue stock that
would reduce Seagram's percentage ownership without its consent.
Pursuant to this agreement, Edgar S. Woolard, Jr., and Richard E. Heckert are
members of the Seagram Board of Directors; Charles R. Bronfman, Edgar M.
Bronfman, Edgar Bronfman, Jr., E. Leo Kolber and John L. Weinberg are members
of the DuPont Board of Directors; and Charles R. Bronfman and Edgar M. Bronfman
serve as members of the DuPont Strategic Direction Committee. Seagram's
representation on the DuPont Board and Strategic Direction Committee is
proportionate to its stock ownership. If Seagram's holdings in DuPont should
decrease to 20 percent, 15 percent or 10 percent, its representation on the
Board and Strategic Direction Committee will be reduced accordingly. DuPont
will continue to have the right to nominate two members of the Seagram Board of
Directors.
The amended agreement also provides, among other things, that during its term
(i) Seagram's obligation not to exceed 25 percent of the combined voting power
of all voting securities of DuPont does not apply if any person should acquire
or make an offer for DuPont voting securities carrying more than 20 percent of
such combined voting power, (ii) Seagram will vote its DuPont voting securities
for nominees to the DuPont Board of Directors and, unless DuPont otherwise
consents in writing, will vote in the same proportion as the votes cast by
other stockholders on other routine corporate matters, but will be free to vote
its DuPont shares as it sees fit on certain significant transactions, (iii)
Seagram's right to solicit proxies or participate in solicitation in opposition
to the recommendations of the majority of the directors of DuPont will be
subject to certain limitations, (iv) the DuPont right of first refusal should
Seagram wish to dispose of its DuPont holdings will be subject to exceptions to
permit public distributions, pledges, sales to any person or group who would
not thereafter own more than one percent of the combined voting power of DuPont
voting securities, and certain other transfers and (v) DuPont will provide to
Seagram such information as may be necessary to enable Seagram to account for
its investment in DuPont on the equity method and to comply with other
reporting and disclosure obligations.
The agreement is subject to termination by either party upon a default by the
other or the failure by the other to elect the specified designees to the
positions stated, or if Seagram owns voting securities of DuPont equivalent to
less than 10 percent or, except under certain circumstances, more than 25
percent of the combined voting power of DuPont voting securities at the time
outstanding. Upon termination of the agreement, all covenants of the parties
expire.
(B) C. R. Bronfman and E. M. Bronfman are brothers; E. M. Bronfman is the
father of E. Bronfman, Jr.
BENEFICIAL OWNERSHIP OF SECURITIES
PRINCIPAL STOCKHOLDERS. As of December 31, 1993, The Seagram Company Ltd.,
Montreal, Quebec, beneficially owned an aggregate of 164,222,031 shares of
DuPont Common Stock, or 24.2% of such shares outstanding at the time. These
shares are shown in the following table as being indirectly beneficially owned,
as defined by Securities and Exchange Commission rules, by C. R. Bronfman, E.
M. Bronfman and E. Bronfman, Jr., and will be voted in accordance with the
terms of the agreement described above in Note A. As of the same date,
Wilmington Trust Company, Wilmington, Delaware, beneficially owned an aggregate
of 41,544,752 shares of the Company's Common Stock, or 6.1% of such shares
outstanding at the time. The shares held by Wilmington Trust are held of record
for trust, estate, custody or agency accounts.
DIRECTORS AND EXECUTIVE OFFICERS. Following is information concerning
beneficial ownership of shares in DuPont for each director and nominee,
executive officers named in the Summary Compensation Table on page 12 and for
all directors and executive officers as a group as of December 31, 1993. Also
included are shares of DuPont Common Stock awarded in 1994 under the Variable
Compensation Plan. Under rules of the Securities and Exchange Commission,
"beneficial ownership" is deemed to include shares for which the individual,
directly or indirectly, has or shares voting or investment power, whether or
not they are held for the individual's benefit.
8
<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP
---------------------------------
(NUMBER OF SHARES)
VOTING OR
INVESTMENT RIGHT TO PERCENT OF
DIRECT(1) POWER(2) ACQUIRE(3) CLASS(4)
--------- ----------- ---------- ----------
<S> <C> <C> <C> <C>
DUPONT COMMON
P. N. Barnevik........... -- -- -- --
E. P. Blanchard,
Jr.(/5/)................ 28,424 2,561,277* 177,977 --
A. F. Brimmer............ 5,818 162 -- --
C. R. Bronfman........... -- 164,222,031* -- 24.2%
E. M. Bronfman........... -- 164,222,031* -- 24.2%
E. Bronfman, Jr. ........ -- 164,222,031* -- 24.2%
L. C. Duemling........... 155,778 1,087,712* -- --
A. W. Dunham............. 51,374 -- 188,994 --
E. B. du Pont............ 719,791 4,085,272* -- 0.7%
C. M. Harper............. 5,766 -- -- --
R. E. Heckert............ 240,046 2,580,102* -- --
H. W. Johnson............ 26,559 -- -- --
E. L. Kolber............. 1,500 -- -- --
J. A. Krol............... 20,282 71,101* 184,900 --
M. P. MacKimm............ 2,000 -- -- --
C. S. Nicandros.......... 61,822 -- 228,879 --
W. K. Reilly............. 508 -- -- --
H. R. Sharp, III......... 100,135 3,288,341* -- 0.5%
W. E. Tatum.............. 7,088 4,756 88,400 --
C. M. Vest............... 223 -- -- --
J. L. Weinberg........... 9,152 -- -- --
E. S. Woolard, Jr........ 128,231 341,896* 621,511 --
Directors and Executive
Officers as a
Group(/5/).............. 1,749,613 172,623,171 2,597,797 26.0%
</TABLE>
- --------
(1) Reported in this column are shares held individually or jointly with
others, or in the name of a bank, broker or nominee for the individual's
account. Also included in this column are shares to be delivered at a future
date under the Variable Compensation Plan and the Deferred Compensation Plan
for Directors.
(2) Reported in this column are other shares with respect to which directors
and executive officers have or share voting or investment power, including
shares directly owned by certain relatives with whom they are presumed to
share voting and/or investment power.
(3) Reported in this column are shares which directors and executive officers
have a right to acquire through the exercise of stock options granted under
the DuPont Stock Performance Plan.
(4) Unless otherwise indicated, beneficial ownership of any named individual
does not exceed 0.5% of the outstanding shares of the class.
(5) E. P. Blanchard, Jr., owns directly 100 shares of Du Pont Canada Inc.
Common Stock. Directors and executive officers as a group own directly 1,100
shares of Du Pont Canada Inc. Common Stock.
* Because they may be deemed to share, directly or indirectly, voting and/or
investment power, C. R. Bronfman, E. M. Bronfman and E. Bronfman, Jr., are
each listed as beneficial owners of the same 164,222,031 shares of DuPont
Common Stock; E. B. du Pont and H. R. Sharp, III are each listed as
beneficial owners of the same 2,660,151 shares; E. P. Blanchard, Jr., and
R. E. Heckert are each listed as beneficial owners of the same 2,560,977
shares; E. B. du Pont and J. A. Krol are each listed as beneficial owners
of the same 71,101 shares; and L. C. Duemling and E. S. Woolard, Jr., are
each listed as beneficial owners of the same 327,650 shares. These shares
of DuPont Common Stock are reported only once in the total for directors
and executive officers as a group.
COMPLIANCE WITH THE SECURITIES EXCHANGE ACT. The Company's directors and
executive officers are required under the Securities Exchange Act of 1934 to
file reports of ownership and changes in ownership of DuPont Common Stock with
the Securities and Exchange Commission and the New York Stock Exchange. In
1993, one report filed on a timely basis was amended promptly to include
another transaction by H. C. Sager, who had retired as an executive officer in
1992.
9
<PAGE>
COMPENSATION AND BENEFITS COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Benefits Committee of the Board of Directors (the
"Committee") is responsible for establishing policies and programs which govern
compensation for executive officers and other employees who participate in the
Company's Variable Compensation Plan and Stock Performance Plan. The Committee
makes specific individual recommendations to the Board of Directors for
employee directors (Chairman and Vice Chairmen).
The Company's executive compensation policy is to provide appropriate total
annual compensation when compared with positions of equivalent responsibility
within a self-constructed group of peer companies, taking into consideration
relative corporate financial performance. Total annual compensation consists of
salary and variable compensation. The Committee annually evaluates the
Company's corporate performance and annual compensation against the peer group,
which are the same companies included in the peer group index used in the stock
performance graph shown on page 14. The policy also provides for competitive
long-term compensation opportunity when compared with other major industrial
companies, including many of those shown in the peer group index.
Compensation for executive officers consists of three components: salary,
variable compensation and stock options.
SALARY
Consistent with the Company's policy, salaries are generally maintained near
the average of the peer group. Each year the salary structure is adjusted to
maintain a competitive position. Salary increases for executive officers are
determined through the administration process used for all salaried employees.
Specific increases reflect individual performance.
VARIABLE COMPENSATION
In 1993 the Committee recommended and the Board of Directors approved that
the Incentive Compensation Plan be renamed the Variable Compensation Plan to
more accurately reflect its purpose. The Plan provides approximately 10,000
employees, including executive officers, with total annual compensation that
varies up or down based on the performance of the Company, the performance of
their business unit and their own contribution. Typically, 25% of variable
compensation is paid in DuPont Common Stock.
As approved by shareholders, the Plan limits the annual funding to 20% of
consolidated net income after deducting 6% of net capital employed. Each year
the Committee reviews operating results and may take into account significant
items of income or loss in determining the Plan limit. This ensures that the
amount available for variable compensation will fluctuate in relation to the
Company's operating results. In the past ten years, the Committee has approved
payments on average of only about 65% of the amount provided by the Plan limit.
In determining the amount of payments, the Committee currently uses a formula
with equally weighted components of earnings per share (EPS) versus the prior
year and return on equity (ROE) versus a goal of 16% and, further, an
assessment of cash flow management for the current year. The formula may also
be adjusted based on an assessment of corporate financial performance compared
with the peer group of companies and performance in such areas as valuing and
developing people, safety, the environment and continuous improvement.
For 1993, the Committee approved average payments at 100% of payments for
1992 and about 95% of the Plan limit. In arriving at the level of payout for
1993, the Committee considered that earnings (excluding restructuring and other
nonrecurring items) had improved by 25% over 1992 on the same basis. Corporate
return on equity was still below the 16% goal, but cash flow management
significantly exceeded expected performance.
STOCK OPTIONS
Stock options are intended to provide long-term incentive for employees
responsible for the future success of the Company. About 800 employees,
including executive officers, key leaders in all regions and significant
participation by middle management, received grants in 1993.
10
<PAGE>
The Committee has established stock option targets for each participating
level of responsibility within the Company based on a survey conducted by
Frederic W. Cook & Co., Inc., of about 35 large industrial companies. The
consulting firm's survey included eight of the peer group companies used for
the total annual compensation and stock performance graph comparisons described
above, as well as other publicly traded companies with multibillion dollar
revenues. This broader group of companies, rather than the peer group, is used
for determining long-term compensation because of the greater variability in
value of long-term compensation plans. Targets for DuPont are based on the
median of this group.
Stock options are typically granted annually. Individual grants may range
from one-half to one-and-one-half of the target for each level of
responsibility to reflect individual performance and potential. Current
stockholdings do not influence the Committee's decision. In addition to annual
grants, special stock option grants are made to employees to recognize
advancement to key senior management positions and to recognize significant
achievements. All grants are at market price on the date of grant and after
they become exercisable have value only if the price of DuPont Common Stock has
increased to a value greater than at the grant date. As further incentive for
stock performance, for options granted in March 1994, the price of DuPont
Common Stock must be at least 120% of the price on the date of grant in order
for the options to be exercisable. This insures that a significant gain for
shareholders is achieved before compensation is realized.
COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER
In 1990 the Committee changed the practice of tracking other large companies
to determine the Chief Executive Officer's compensation to address concerns
over the upward spiraling of executive compensation and the widening divergence
in CEO compensation compared to the average employee. To accomplish this, the
position of Senior Vice President was used as the benchmark tie to the
comparison companies rather than the CEO. Total annual compensation for the CEO
is currently targeted at about twice that of Senior Vice Presidents. Targeting
the CEO's compensation using an internal benchmark rather than tracking CEO
annual compensation of other companies has resulted in compensation for the CEO
about 15% lower than if past practice had continued.
For 1993 Mr. Woolard's salary and variable compensation were the same as for
1992. In determining his variable compensation, the Committee applied the same
formula--performance factors, goals, and weighting--on a basis consistent with
the determination of variable compensation granted to other employees for 1993,
as described above under Variable Compensation. His variable compensation for
1993 and his stock option grant in 1993 were both at 100% of target for his
level of responsibility. In addition to reflecting the Company's financial and
operating results, in evaluating Mr. Woolard's performance the Committee noted
his leadership in transforming the Company into an effective global competitor
through restructurings, cost reductions and productivity improvements.
* * * * *
Recent changes in the federal tax laws impose new requirements in order for
compensation payable to the CEO and certain executive officers to be fully
deductible. The Company intends to take appropriate actions to preserve its
income tax deduction. For example, as described on page 16, the Company
proposes to reinstitute a limit on stock options that an employee can receive.
The Company is also reviewing the tax rules to determine if any changes should
be considered in administering variable compensation, which is already based on
a formula related to the Company's performance.
The Compensation and Benefits Committee believes the executive compensation
programs and practices described above are competitive and somewhat
conservative. They are designed to provide increased compensation with improved
financial results and provide additional opportunity for capital accumulation,
but only if shareholder value is increased.
COMPENSATION AND BENEFITS COMMITTEE
John L. Weinberg, Chairman
Edgar M. Bronfman
Richard E. Heckert
Howard W. Johnson
H. Rodney Sharp, III
11
<PAGE>
COMPENSATION AND STOCK OPTION INFORMATION
The following table shows information about the compensation of the Company's
five highest paid executive officers. Two additional tables provide detailed
information about these employees' stock options.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------- ---------------
NAME AND VARIABLE SHARES ALL OTHER
PRINCIPAL COMPENSATION UNDERLYING COMPENSA-
POSITION YEAR SALARY (BONUS)(1) OPTIONS GRANTED TION(2)
--------- ---- -------- ------------ --------------- ---------
<S> <C> <C> <C> <C> <C>
E. S. Woolard, Jr. 1993 $792,000 $450,000 75,800 $ 7,005
Chairman of the Board 1992 792,000 450,000 90,400 6,848
and CEO 1991 756,000 600,000 82,300 6,601
C. S. Nicandros 1993 618,000 360,000 43,800 14,150
Vice Chairman 1992 588,000 310,000 44,700 13,732
1991 528,600 374,000 87,700 13,333
J. A. Krol 1993 528,000 300,000 36,600 7,005
Vice Chairman 1992 456,600 271,000 60,900 6,848
1991 336,400 239,000 28,000 6,601
A. W. Dunham 1993 416,800 270,000 26,400 14,150
Senior Vice President 1992 391,000 170,000 38,500 8,028
1991 350,400 222,000 28,500 6,601
W. E. Tatum 1993 393,600 205,000 24,500 7,005
Senior Vice President 1992 361,500 187,000 21,200 6,848
1991 337,800 218,000 23,700 6,601
</TABLE>
- --------
(1) On average, about 25% of variable compensation is paid in DuPont Common
Stock.
(2) Matching contributions made pursuant to the Company's savings and thrift
plans.
AGGREGATED 1993 OPTION EXERCISES/YEAR-END 1993 OPTION VALUES TABLE
<TABLE>
<CAPTION>
SHARES UNDERLYING VALUE OF UNEXERCISED
OPTION UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
EXERCISES IN 1993 HELD AT DEC. 31, 1993 HELD AT DEC. 31, 1993(2)
---------------------- ------------------------- -------------------------
SHARES
UNDERLYING VALUE
NAME OPTIONS REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ---------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
E. S. Woolard, Jr. ..... 40,644 $1,435,241 545,711 75,800 $6,836,698 $170,550
C. S. Nicandros......... 0 0 185,079 43,800 1,298,638 98,550
J. A. Krol.............. 0 0 148,300 36,600 1,157,673 82,350
A. W. Dunham............ 29,321 948,851 162,594 26,400 1,890,912 59,400
W. E. Tatum............. 0 0 63,900 24,500 461,100 55,125
</TABLE>
- --------
(1) Represents the pre-tax gain, which is the difference between the market
value of the shares on the date of exercise of the options and the exercise
price.
(2) Represents the closing price for DuPont Common Stock on December 31, 1993
of $48.25 less the exercise price for all outstanding exercisable and
unexercisable options for which the exercise price is less than such
closing price. Exercisable options have been held at least one year from
the date of grant. Unexercisable options have been held for less than one
year.
12
<PAGE>
OPTION GRANTS TABLE
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL OPTION GRANTS IN 1993 FOR OPTION TERM(3)
--------------------------------------- ---------------------------------
NUMBER OF PERCENT
SHARES OF TOTAL
UNDERLYING OPTIONS EXPIRA-
OPTIONS GRANTED EXERCISE TION 0% 5% 10%
NAME GRANTED(1) IN 1993 PRICE(2) DATE $46.00 $75.00 $119.25
- ---- ---------- -------- --------- --------- ------ ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
E. S. Woolard, Jr....... 75,800 3.51% $46.00 1/26/2003 0 $2,198,200 $5,552,350
C. S. Nicandros......... 43,800 2.03% 46.00 1/26/2003 0 1,270,200 3,208,350
J. A. Krol.............. 36,600 1.69% 46.00 1/26/2003 0 1,061,400 2,680,950
A. W. Dunham............ 26,400 1.22% 46.00 1/26/2003 0 765,600 1,933,800
W. E. Tatum............. 24,500 1.13% 46.00 1/26/2003 0 710,500 1,794,625
- --------
All Shareholders'
Gains................ increase in market value of DuPont
Common Stock at assumed rates of stock
price appreciation(4) ................ $19,578,848,619 $49,453,471,081
All Optionees'
Gains................ as a percent of all shareholders'
gains(5).............................. 0.32% 0.32%
</TABLE>
- --------
(1) Stock options are exercisable twelve months from the date of grant and have
a term of ten years. All of these options were granted on January 27, 1993.
(2) The exercise price is the average of the high and low prices of the DuPont
Common Stock as reported on the NYSE-Composite Transactions Tape on the
date of grant.
(3) Represents total potential appreciation of about 0%, 63% and 159% for
assumed annual rates of appreciation of 0%, 5% and 10%, respectively,
compounded annually for the ten-year option term.
(4) Calculated from the $46.00 exercise price applicable to most options
granted in 1993 based on the 675,132,711 shares outstanding on the January
27, 1993 grant date.
(5) Represents potential realizable value for all options granted in 1993 as
compared to the increase in market value of DuPont Common Stock at assumed
rates of stock price appreciation. Potential realizable value for all
options granted in 1993 is calculated from the $46.00 exercise price
applicable to most options granted in 1993.
13
<PAGE>
STOCK PERFORMANCE INFORMATION
The following graph presents the cumulative, five-year total return for
DuPont Common Stock compared with the S&P 500 Stock Index and a peer group of
companies. DuPont has used this peer group for several years to compare
compensation for senior management, and eight of the twelve companies are
direct competitors. The peer group companies are: AlliedSignal, Amoco, Dow
Chemical, Eastman Kodak, Exxon, Ford Motor, General Electric, International
Business Machines, Minnesota Mining and Manufacturing, Monsanto, Union Carbide
and Xerox.
The graph assumes that the value of the investment in DuPont Common Stock,
the S&P 500 Stock Index and the peer group of companies each was $100 on
December 31, 1988 and that all dividends were reinvested. The peer group is
weighted by market capitalization.
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG DUPONT, S&P 500 INDEX AND PEER GROUP
[GRAPH APPEARS HERE]
<CAPTION>
1988 1989 1990 1991 1992 1993
<S> <C> <C> <C> <C> <C> <C>
DuPont 100.0 $145.0 $135.6 $178.7 $187.1 $198.6
S&P 500 100.0 $131.6 $127.5 $166.2 $178.8 $196.7
Peer Group 100.0 $113.0 $113.0 $129.6 $133.4 $160.3
</TABLE>
RETIREMENT BENEFITS
Retirement benefits for DuPont employees under the DuPont Pension and
Retirement Plan are based on an employee's years of service and average monthly
pay during the employee's three highest-paid years. "Average monthly pay" for
this purpose includes regular compensation and 50% of annual variable
compensation payments, but excludes other bonuses and compensation in excess of
limits imposed by the Internal Revenue Code.
The Internal Revenue Code limits the amount of annual benefits which may be
payable from the pension trust. Retirement benefits provided under the pension
plan in excess of these limitations are paid from the Company's general
revenues under a separate, nonfunded Pension Restoration Plan. A second
nonfunded plan called the Supplemental Retirement Income Plan, primarily
affecting higher levels of management, includes all variable compensation in
the determination of retirement benefits. Benefits, if any, under the
Supplemental Retirement Income Plan may not cause aggregate retirement income
to exceed 50% of average annual total compensation.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL RETIREMENT
SALARY AND BENEFITS BASED ON SERVICE OF:
VARIABLE ------------------------------
COMPENSATION 25 YEARS 35 YEARS 45 YEARS
------------ ---------- --------- ---------
<S> <C> <C> <C>
$ 500,000.............................. $153,000 $218,000 $273,000
750,000.............................. 231,000 327,000 404,000
1,000,000.............................. 309,000 436,000 544,000
1,250,000.............................. 388,000 547,000 684,000
1,500,000.............................. 467,000 658,000 822,000
1,750,000.............................. 546,000 768,000 960,000
</TABLE>
The above table illustrates the straight life annuity amounts payable under
the DuPont Pension and Retirement Plan, Pension Restoration Plan and
Supplemental Retirement Income Plan to DuPont employees
14
<PAGE>
retiring at age 65 in 1994. As of normal retirement age (65), the years of
service credited for retirement benefits for DuPont employees named in the
Summary Compensation Table on page 12 would be as follows: 41 years for E. S.
Woolard, Jr., 38 years for J. A. Krol and 39 years for W. E. Tatum.
The DuPont Pension and Retirement Plan as it applies to Conoco employees and
the Retirement Restoration Benefit Plan of Conoco are similar to the DuPont
Pension and Retirement Plan and the Pension Restoration Plan described above
for DuPont employees.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL
RETIREMENT BENEFITS
SALARY AND BASED ON SERVICE OF:
VARIABLE --------------------------
COMPENSATION 25 YEARS 35 YEARS 45 YEARS
------------ -------- -------- --------
<S> <C> <C> <C>
$ 500,000................................. $160,000 $225,000 $291,000
750,000................................. 238,000 333,000 431,000
1,000,000................................. 321,000 450,000 580,000
1,250,000................................. 404,000 566,000 730,000
</TABLE>
The above table illustrates the straight life annuity amounts payable to
employees of Conoco retiring at age 65 in 1994, including payments under the
Retirement Restoration Benefit Plan. As of normal retirement age (65), A. W.
Dunham and C. S. Nicandros would have 37 and 38 years of credited service,
respectively.
2--RATIFICATION OF INDEPENDENT ACCOUNTANTS
Article III, Section 5, of the Bylaws provides that it shall be the duty of
the Audit Committee to employ, subject to stockholder ratification at each
annual meeting, independent accountants to audit the books of account,
accounting procedures and financial statements of the Company for the year and
to perform such other duties as prescribed from time to time by the Audit
Committee. On April 28, 1993, the stockholders ratified the appointment by the
Audit Committee of Price Waterhouse to perform the functions assigned to it in
accordance with the Bylaws.
Price Waterhouse has served as independent accountants of the Company
continuously since 1954. It is believed that its knowledge of the Company's
business gained through this period of service is most valuable. Partners and
employees of the firm who work on the Company's account are periodically
changed, thus giving the Company the benefit of new thinking and approaches in
the audit area.
During 1993, Price Waterhouse audited the Company's annual consolidated
financial statements and those of a significant majority of its subsidiaries,
reviewed financial information in filings with the Securities and Exchange
Commission and other regulatory agencies, audited employee benefit plans and
provided various other services. Worldwide fees for all services provided by
Price Waterhouse totaled $13.2 million for the year, of which $5.8 million was
for the annual audit of the Company's consolidated financial statements and
those of its subsidiaries.
Subject to ratification by the holders of DuPont Common Stock, the Audit
Committee has reemployed Price Waterhouse as independent accountants to perform
an examination of the Company's consolidated financial statements for the year
1994 and to render other services as required of them.
Representatives of Price Waterhouse are expected to be present at the meeting
and will have an opportunity to address the meeting and respond to appropriate
questions.
15
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE FOLLOWING
RESOLUTION:
RESOLVED, That the action of the Audit Committee in employing Price
Waterhouse as independent accountants for the year 1994 to perform the
functions assigned to them in accordance with Article III, Section 5, of
the Bylaws of E. I. du Pont de Nemours and Company hereby is ratified.
3--MANAGEMENT PROPOSAL ON AMENDMENT OF STOCK PERFORMANCE PLAN
The DuPont Stock Performance Plan (formerly the Stock Option Plan) was last
approved by the stockholders at the 1989 Annual Meeting and has not been
amended significantly since then. The Board of Directors has adopted several
amendments to the Plan subject to stockholder approval. These amendments,
summarized below following a brief description of key provisions of the Plan,
are incorporated in the Stock Performance Plan set forth at Exhibit A.
THE PLAN
Grants under the DuPont Stock Performance Plan may be made to employees of
DuPont and entities in which DuPont has at least a 50% interest. The Plan is
administered by the Compensation and Benefits Committee of the Board of
Directors, whose members are ineligible for grants while serving on this
Committee. Grants may be in the form of incentive or other qualified stock
options which meet requirements under the Internal Revenue Code for favorable
tax treatment, nonqualified stock options, or a combination of qualified and
nonqualified stock options. Stock appreciation rights may be granted solely in
tandem with stock options but have not been granted since 1991. There is no
present intent to grant stock appreciation rights.
The Compensation and Benefits Committee, or the Board of Directors if the
grant is made to an employee director, determines the number of shares covered
by stock options. All options are granted at market price at the time of the
grant and have a maximum term of ten years. An optionee electing to exercise a
stock option must at the time of exercise pay the full exercise price of the
shares of DuPont Common Stock being purchased. Payment of the exercise price
shall be made in cash or DuPont Common Stock valued at fair market value on the
date of exercise.
Under terms and conditions established by the Compensation and Benefits
Committee, all stock options vest and become exercisable one year after the
date of grant, except in the event of retirement or death when options vest and
become exercisable if held for a minimum period of six months from the date of
grant (as to executive officers, subject to the amendment described below). In
addition, beginning on the first date of exercisability for options granted in
March 1994 and ending six months prior to the tenth anniversary of the grant
date, the average price of DuPont Common Stock on the date of exercise must be
at least 120% of the average price on the grant date in order for the options
to be exercisable. The terms and conditions also provide that options may be
exercised until two years after retirement or age 70, whichever is later, and
by an optionee's estate or beneficiary for up to two years after death. The
Plan provides that in no instance can options be exercised after their ten-year
maximum term. Stock options are forfeited upon termination of employment with
the Company for any reason other than death or retirement occurring at least
six months after the date of grant. They cannot be transferred or assigned
during the optionee's lifetime.
Counsel advises that under the Internal Revenue Code, optionees will realize
no taxable income as a result of the grant of options. While exercise of an
incentive stock option which meets the requirements of the Code will not result
in taxable income (except that the alternative minimum tax may apply), exercise
of a nonqualified stock option will result in taxable income to the extent of
the difference between the fair market value of the stock at the time of
exercise and the exercise price. The Company will be entitled to a tax
deduction upon the exercise of a nonqualified option in the amount equal to the
optionee's taxable income. If the optionee sells the shares acquired on
exercise of incentive stock options more than two years after the grant date
and more than one year after exercise, the entire gain, if any, realized upon
the sale will be taxable to the optionee as long-term capital gain. If the
optionee does not satisfy the holding period requirements,
16
<PAGE>
the optionee will realize ordinary income, in most cases equal to the
difference between the exercise price of the shares and the lesser of the fair
market value of the shares on the exercise date or the amount realized on a
sale or exchange of the shares, and the Company will be entitled to a
corresponding tax deduction.
The Board of Directors reserves the right to modify the Stock Performance
Plan from time to time, to repeal the Plan entirely, or to discontinue making
grants either temporarily or permanently; provided, however, that no
modification of the Plan shall operate to annul, without the consent of the
optionee, a grant already made. Furthermore, no modification without approval
of the stockholders shall increase the maximum number of shares which may be
made subject to stock options or the maximum number of stock appreciation
rights which may be granted, permit the grant of stock options and stock
appreciation rights at a price less than fair market value, extend the maximum
term beyond ten years, or permit grants to members of the Compensation and
Benefits Committee. All expenses and costs in connection with the operation of
the Plan are borne by the Company.
The Board of Directors amended the Company's Bylaws to delete a requirement
for approval of the Company's Compensation Plans by stockholders every five
years. Significant amendments such as those described below for the Stock
Performance Plan will continue to be submitted to the stockholders for approval
as required by provisions of the Company's Compensation Plans, rules of the
Securities and Exchange Commission or regulations of the Internal Revenue
Service.
THE PROPOSED AMENDMENTS
Use of Restricted Stock. The Company's executive compensation program
consists of three elements: salary, variable compensation and stock options as
long-term incentive. Addition of restricted stock as long-term compensation
under the Stock Performance Plan will provide flexibility in the future.
Restrictions on disposition of the shares and other terms and conditions will
be established by the Compensation and Benefits Committee. Depending on the
specific intended use of such grants, restrictions could be based on such
criteria as quantitative or qualitative business performance objectives and/or
continued employment. Grantees will have all the rights of a stockholder,
including the right to vote and receive any dividends, unless otherwise
established in the grant.
Limit on Shares Subject to Restricted Stock Grants. No change is made in the
current 36 million-share limit on the aggregate number of shares of the
Company's Common Stock which may be made subject to stock option grants during
any five consecutive years. Of the 36 million shares, no more than 6 million
shares will be subject to restricted stock grants.
Limit on Individual Option Grants. The Company will reinstitute an individual
limit on stock options that an employee can receive. No more than 5% of the 36
million-share limit on the aggregate number of shares of the Company's Common
Stock will be made subject to stock options granted to an optionee during any
five consecutive years. Options granted to executive officers effective in
March 1994 were made contingent on stockholder approval of this amendment.
Prior to April 1984, the Plan included a limit on individual option grants.
The Company believes that reinstating the limit is appropriate at this time and
consistent with recent changes in federal tax laws which impose new
requirements on the deductibility of executive compensation related to stock
options. As a result, the federal tax consequences to the Company of the
exercise of stock options may continue as described above.
Vesting of Stock Option Grants. To conform to the Plan's minimum vesting
period for other optionees, the minimum vesting period for options granted to
executive officers will be six months from date of grant. For executive
officers, as for other optionees, the terms and conditions established by the
Compensation and Benefits Committee provide that options do not vest and become
exercisable until one year after date of grant except in the event of
retirement or death when options vest and become exercisable if held for the
minimum period of six months. Options granted to executive officers effective
in 1994 made this aspect of the vesting provision contingent on stockholder
approval of this amendment.
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It is not possible at the present time to indicate the number or positions of
employees who may be selected for grants under the Plan as proposed for
amendment. During 1993, options to purchase 2,160,360 shares were granted under
the Plan to 801 employees, including options to purchase 498,500 shares granted
to 20 executive officers as a group. As of December 31, 1993, 1,226 persons
held outstanding stock options under the Plan to purchase a total of 14,553,921
shares of DuPont Common Stock at a weighted-average exercise price of $37.62
per share, with expiration dates ranging from February 1994 to July 2003.
Directors who are not employees are ineligible for grants under the Plan. No
determination has been made as to types or amounts of grants in the future for
specific employees. See the Summary Compensation Table and Option Grants Table
on pages 12 and 13 for information relating to prior grants to named executive
officers.
The closing price of a share of the Company's Common Stock on the New York
Stock Exchange Composite Transaction Tape on March 1, 1994, was $52.50.
Approval of this proposal will constitute approval of the amendments
described above and continued use of incentive stock options under the Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE FOLLOWING
RESOLUTION:
RESOLVED, That the amendments to the Stock Performance Plan as described in
the Proxy Statement of the Company for the Annual Meeting of Stockholders
on April 27, 1994, hereby are approved.
4--STOCKHOLDER PROPOSAL ON POLITICAL NON-PARTISANSHIP
Mrs. Evelyn Y. Davis, Watergate Office Building, 2600 Virginia Avenue, N.W.,
Suite 215, Washington D.C., owner of 150 shares of DuPont Common Stock, has
given notice that she will introduce the following resolution and statement in
support thereof:
RESOLVED: That the stockholders of DuPont assembled in Annual Meeting in
person and by proxy, hereby recommend that the Corporation affirm its
political non-partisanship. To this end the following practices are to be
avoided:
(a) The handing of contribution cards of a single political party to an
employee by a supervisor.
(b) Requesting an employee to send a political contribution to an
individual in the Corporation for a subsequent delivery as part of a
group of contributions to a political party or fund raising committee.
(c) Requesting an employee to issue personal checks blank as to payee for
subsequent forwarding to a political party, committee or candidate.
(d) Using supervisory meetings to announce that contribution cards of one
party are available and that anyone desiring cards of a different party
will be supplied one on request to his supervisor.
(e) Placing a preponderance of contribution cards of one party at mail
station locations.
STOCKHOLDER'S STATEMENT
REASONS: The Corporation must deal with a great number of governmental
units, commissions and agencies. It should maintain scrupulous political
neutrality to avoid embarrassing entanglements detrimental to its business.
Above all, it must avoid the appearance of coercion in encouraging its
employees to make political contributions against their personal
inclinations. The Troy (Ohio) News has condemned partisan solicitation for
political purposes by managers in a local company (not DuPont). Last year
the owners of 18,270,176 shares, representing approximately 3.5% of the
shares voting, voted FOR this proposal.
If you AGREE, please mark your proxy FOR this resolution.
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POSITION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "AGAINST" THIS PROPOSAL.
The Board opposes this resolution for the reasons given last year when the
same resolution was rejected by more than 96% of the votes cast.
The Company's policy is that no direct or indirect pressure in any form is to
be directed toward employees to make any political contribution or participate
in the support of a political party or the political candidacy of any
individual. At the same time, employees are encouraged to exercise their
responsibilities as citizens and to vote and be involved in the political
process.
The Board believes that the Company's policy goes further than the proposal
and accomplishes the purpose of the proposal to avoid coercion of employees and
embarrassment of the Company.
5--STOCKHOLDER PROPOSAL ON CUMULATIVE VOTING
John J. Gilbert, 29 E. 64th Street, New York, New York, owner of 612 shares
of DuPont Common Stock, who represents an additional family interest of 620
shares and is trustee under wills for an additional 1,600 shares, and John C.
Henry, 5 E. 93rd Street, New York, New York, owner of 240 shares of DuPont
Common Stock, have given notice that one or both of them will introduce the
following resolution and statement in support thereof:
Resolved, That the stockholders of E. I. du Pont de Nemours and Company,
Inc., assembled in annual meeting in person and by proxy, hereby request
the Board of Directors to take the steps necessary to provide for
cumulative voting in the election of directors, which means each
stockholder shall be entitled to as many votes as shall equal the number of
shares he or she owns multiplied by the number of directors to be elected,
and he or she may cast all of such votes for a single candidate, or any two
or more of them as he or she may see fit.
STOCKHOLDERS' STATEMENT
Continued strong support along the lines we suggest were shown at the last
annual meeting when over 13.3%, an increase over the previous year, 6,673
owners of 68,985,133 shares, were cast in favor of this proposal. The vote
against included approximately 13,000 unmarked proxies.
A law enacted in California provides that all state pension holding, as well
as state college funds, invested in shares must be voted in favor of cumulative
voting proposals, showing increasing recognition of the importance of this
democratic means of electing directors.
Also, the National Bank Act has provided for cumulative voting.
Unfortunately, in so many cases companies get around it by forming holding
companies without cumulative voting. Thus, with so many banking failures the
result is that tax payers have to make up the losses. Banking authorities have
the right to question the capability of directors to be on banking boards.
Unfortunately, in so many cases authorities come in after and say the director
or directors were not qualified. So there is no reason why this could not be
done for corporations under the SEC and banking authorities.
It has increasingly been recognized that fair and equitable distribution of
voting power is best secured when all the stockholders have the right of
cumulative voting. This is the purpose of cumulative voting it protects
everyone, in our opinion.
Because of the normal need to find new directors and the need for directors
on the compensation committee, we think cumulative voting is the answer.
Perhaps, if the company had cumulative voting they
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wouldn't have so many troubles. In addition, some recommendations have been
made to carry out the Valdez 10 points. The 11th should be to have cumulative
voting and to end the stagger system of electing directors, in our opinion.
Alaska took away cumulative voting, over our objections, when it became a
state. Perhaps, if the citizens had insisted on proper representation the
disastrous Valdez oil spill might have been prevented if environmental
directors were elected through cumulative voting.
Many successful corporations have cumulative voting. For example, Pennzoil
having cumulative voting defeated Texaco in that famous case. Another example,
in spite of still having a stagger system of electing directors, Ingersoll-
Rand, which has cumulative voting, won two awards. In FORTUNE magazine it was
ranked second as "America's Most Admired Corporations." and the WALL STREET
TRANSCRIPT noted "on almost any criteria used to evaluate management,
Ingersoll-Rand excels." We believe E.I. du Pont de Nemours and Company, Inc.
should follow their example.
If you agree, please mark your proxy for this resolution; otherwise it is
automatically cast against it, unless you have marked to abstain.
POSITION OF BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "AGAINST" THIS PROPOSAL.
The Company's stockholders have had the opportunity to consider and vote on
this issue on numerous occasions beginning in 1955. Each time, the stockholders
have rejected the proposal by at least 86% of the votes cast.
The Board continues to believe that cumulative voting is not in the best
interest of the Company or its stockholders. In the opinion of the Board,
cumulative voting would permit a small minority of shares to elect a director
for the sole purpose of supporting a particular point of view, without regard
to the interests of other parties. A director elected in this manner could not
be expected to exercise free judgment and would not represent the stockholders
as a whole.
6--STOCKHOLDER PROPOSAL ON SITE LISTING
Brent Blackwelder, 3517 Rodman Street, N.W., Washington, D.C., owner of 50
shares of DuPont Common Stock, has given notice that he will introduce the
following resolution and statement in support thereof:
Whereas, the U.S. Securities and Exchange Commission (SEC) requires publicly-
held corporations to disclose potential environmental liabilities to
shareholders;
Whereas, a Price Waterhouse survey of securities issuers in 1992 found that
as many as 62% of the responding companies had known environmental liability
exposures that were not yet recorded in financial statements;
Whereas, DuPont, in its SEC reports, lists some of the major instances of
potential environmental liability that may accrue to the company in pollution
and toxic waste cleanup activities, fines, and environmental litigation;
Whereas, it is unclear how much additional environmental liability, cleanup
responsibility, and remediation cost may exist at DuPont, Conoco, and other
facilities beyond those presently reported;
Whereas, the company prepares an annual environmental progress report for
shareholders and the public; Therefore, be it
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RESOLVED: That the shareholders of DuPont request the Board of Directors to
instruct the company to disclose in its annual environmental progress report, a
listing of those sites and other circumstances in which it can be reasonably
expected through retirement of operations, court order, consent decree,
litigation, or government requirement, that environmental remediation,
pollution clean-up, and/or damage compensation will cause environmental
liabilities to accrue to the company.
STOCKHOLDER'S STATEMENT
REASONS: In recent years, certain forms of environmental liability have
accrued to DuPont at an increasing rate. In 1992, DuPont accrued $160 million
for certain environmental remediation activities relating to past operations,
as compared with $130 million and $135 million for similar remediation in 1991
and 1990 respectively. DuPont has also paid out substantial amounts for
environmental and agricultural damages related to certain of the company's
pesticides.
In addition, government regulators and some industry officials now state that
underground hydrocarbon plumes and/or petrochemical leakage are likely to be
found throughout the U.S. petroleum and petrochemical industries. Groundwater
contamination and long-term cleanup may be involved, public health may be
threatened, and compensation and real estate buy outs may be required.
DuPont's Conoco, for example, agreed to a $23 million settlement and real
estate buy out in Ponca City, Oklahoma after petrochemical contamination and
seepage from Conoco's nearby refinery damaged homes and threatened residents'
health.
DuPont shareholders, in evaluating the company's continued economic
prospects, need to receive the best possible information on the company's
current assets and liabilities, including prospective environmental
liabilities, as reasonably as these can be assembled and forecast.
For these reasons and others, it is imperative that management include in its
annual environmental progress report, a listing and identification of those
known and expected environmental liabilities and clean-up responsibilities that
are likely to accrue to the DuPont Company.
If you AGREE, please mark your proxy FOR this resolution.
POSITION OF BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "AGAINST" THIS PROPOSAL.
DuPont has provided information on its potential environmental liabilities in
several documents available to its stockholders and to the public. Last year,
DuPont initiated an annual report devoted exclusively to the Company's
environmental performance. DuPont recently issued its second annual
environmental progress report, titled "Corporate Environmentalism--1993
Progress Report". The report discusses expenditures for environmental
protection and remediation and explains that DuPont expects to incur some
remediation costs at most older U.S. sites which is typical for chemical and
petroleum operations in the U.S. We believe that, with this inclusive
reference, a specific listing of sites does not provide additional meaningful
financial information to shareholders.
In addition to the information provided in its annual environmental progress
report, DuPont's 1993 Annual Report to Stockholders, which is mailed to
stockholders along with this Proxy Statement, includes a discussion of
"Environmental Matters" as part of Management's Discussion and Analysis. This
discussion sets forth, among other things, an accounting of the Company's
accrual for environmental remediation activities for the past three years,
actual expenditures related to the accrual, the accrual for environmental
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remediation activities reflected on the balance sheet and an estimate of
DuPont's remediation costs for the next several years. The Company's accounting
policies and practices for accruals for environmental remediation are discussed
in the Notes to Financial Statements in the 1993 Annual Report. DuPont is also
subject to the reporting requirements of the Securities and Exchange Commission
on Form 10-K which includes disclosure of the financial effects of compliance
with Federal, State and local environmental provisions.
As noted in the Annual Report to Stockholders, copies of DuPont's annual
environmental progress report and its Form 10-K are available to shareholders
upon request. DuPont has provided information on its potential environmental
liabilities in these documents and its Annual Report to Stockholders and has
shared its expectation that it will incur some remediation costs at most older
U.S. sites. It is the Company's intent to continue to evolve its discussion of
potential environmental liabilities. Therefore, the Board believes the Company
has already achieved the objectives of the Proposal.
OTHER MATTERS
The Board of Directors knows of no other proposals to be presented for
consideration at the meeting but, if other matters do properly come before the
meeting, the persons named in the proxy will vote your shares according to
their best judgment.
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EXHIBIT A
STOCK PERFORMANCE PLAN
I. PURPOSES
The purposes of this Stock Performance Plan (the "Plan") are: (a) to provide
greater incentive for employees who are or will be primarily responsible for
the growth and success of the business to exert their best efforts on behalf of
E. I. du Pont de Nemours and Company ("the Company"); and (b) to further the
identity of interests of such employees with those of the Company's
stockholders generally by encouraging them to acquire stock ownership in the
Company.
II. FORM OF GRANTS
1. Grants under this Plan may be made in the form of stock options, stock
options accompanied by stock appreciation rights, restricted stock or a
combination of any of these forms and may be made in replacement of or as
alternatives to salary or grants under any other plan or program of a plan
company.
2. Stock options to purchase shares of the Company's common stock granted
under this Plan may be either incentive, performance or other stock options
qualified under the Internal Revenue Code as in effect from time to time
("qualified stock options") or stock options that are not qualified under the
Internal Revenue Code ("nonqualified stock options"), or a combination of
qualified and nonqualified stock options.
3. Stock appreciation rights may be granted by the Company under this Plan
upon such terms and conditions as the Compensation and Benefits Committee may
determine. Such rights may be granted only when they accompany the concurrent
grant of stock options. Each stock appreciation right shall give the grantee
the right to receive a payment equal to the excess of the fair market value of
a share of the Company's common stock on the date when such right is exercised
over the option price provided for in the accompanying stock option. Such
rights may be exercised only if the grantee exercises the accompanying stock
option by purchasing one share of the Company's common stock for each stock
appreciation right exercised. The number of shares subject to exercise under an
accompanying stock option shall be automatically reduced by one share for each
stock appreciation right exercised.
4. Shares of restricted stock granted under this Plan shall be subject to
restriction, such as forfeiture and a minimum vesting period. A grantee shall
generally have all incidents of ownership in restricted stock, including the
right to dividends (unless otherwise restricted) and to vote. Shares may be
evidenced by book-entry registration, a stock certificate registered in the
grantee's name but held in the Company's custody or issuance of an appropriate
legended stock certificate, as determined by the Compensation and Benefits
Committee.
III. LIMITATIONS ON GRANTS
1. The aggregate number of shares of the Company's stock which may be made
subject to stock options granted under this Plan shall not exceed 36,000,000,
or 5% of such number for any optionee, during any five consecutive years, of
which only 6,000,000 shares may be subject to restricted stock grants. The
number of stock appreciation rights which may be granted to any optionee under
this Plan shall not exceed 50% of the number of shares made subject to any
accompanying stock option.
2. If any stock option or restricted stock (without benefit of dividends)
granted under this Plan shall terminate or expire for any reason without having
been exercised or vested in full, the shares not acquired under such grant
shall become available again for further grants under this Plan; provided also,
that shares withheld by or tendered to the Company as payment of exercise price
or other consideration or satisfaction of withholding taxes shall become
available again for further grants to employees who are not executive
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officers; provided, however, that the shares which become so available for
further grants shall not include any shares as to which a stock option has been
reduced by reason of receiving payments under accompanying stock appreciation
rights. The limitations set forth above shall be subject to adjustment as
provided in Article XII hereof.
IV. ADMINISTRATION
1. Except as otherwise specifically provided, the Plan shall be administered by
the Compensation and Benefits Committee of the Company's Board of Directors.
The Compensation and Benefits Committee shall be elected pursuant to the Bylaws
of the Company, and the members thereof shall be ineligible for grants while
serving on said Committee.
2. The Compensation and Benefits Committee is authorized, subject to the
provisions of the Plan, from time to time to establish such rules and
regulations as it deems appropriate for the proper administration of the Plan,
and to make such determinations and take such steps in connection therewith as
it deems necessary or advisable.
3. The Compensation and Benefits Committee shall, subject to the provisions of
the Plan, determine the time or times when stock options will be granted, which
employees, if any, shall be granted stock options, the types of stock options
to be granted, whether they shall be granted singly or in combination, when
they shall be exercisable, the number of shares to be covered by each stock
option or options, and the terms and conditions of such stock options; which
employees, if any, shall also be granted accompanying stock appreciation
rights, the number of stock appreciation rights which shall be granted to each
of them, and the terms and conditions of such rights; and the time or times
when restricted stock will be granted, which employees, if any, shall be
granted restricted stock, the number of restricted shares to be granted, the
restrictions or conditions on the right to transfer or dispose of such shares,
and the terms and conditions of such restricted stock, including the number,
amount, and timing of vesting increments.
4. The decision of the Compensation and Benefits Committee with respect to any
questions arising as to interpretation of this Plan, including the severability
of any and all of the provisions thereof, shall be final, conclusive and
binding.
5. The Company's Board of Directors may elect a Special Stock Performance
Committee pursuant to the Bylaws of the Company which shall have and may
exercise all the rights, powers and duties of the Compensation and Benefits
Committee specified in this Plan for purposes of making grants for significant
achievements by employees who are not directors or executive officers of the
Company. The Special Stock Performance Committee may also be authorized by the
Compensation and Benefits Committee to assume certain administrative
responsibilities under this Plan.
V. ELIGIBILITY FOR GRANTS
1. Grants under this Plan may be made to employees (including those who are
directors or executive officers of the Company) as determined by the
Compensation and Benefits Committee (or Board of Directors, if the grantee is a
director of the Company). In determining those employees to whom grants are to
be made, the Compensation and Benefits Committee (or Board of Directors, if the
grantee is a director of the Company) may take into consideration present and
potential contributions to the Company's success by such employees, and any
other factors which the Compensation and Benefits Committee (or Board of
Directors, if the grantee is a director of the Company) may deem relevant in
connection with accomplishing the purposes of the Plan.
2. The term "employee" may include an employee of a corporation or other
business entity in which the Company shall directly or indirectly own fifty
percent or more of the outstanding voting stock or other ownership interest,
but shall exclude any director who is not also an officer or a full-time
employee of a plan
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company. The term "plan company" as used in this Plan shall mean a business
entity whose employees are eligible for grants under this Plan. The term
"grantee" as used in this Plan means an employee to whom a grant has been made
under this Plan or, where appropriate, his or her successor in interest upon
death.
VI. RECOMMENDATIONS AND GRANTS
1. Recommendations for grants to members of the Board of Directors shall be
made by the Compensation and Benefits Committee. Recommendations for grants to
employees who are not members of the Board of Directors shall be made to the
Compensation and Benefits Committee by the Office of the Chairman.
2. Any grant to a director shall be made in the sole discretion of the Board of
Directors, a majority of whose members taking final action on any such grant
shall be ineligible for grants under Article V. Any grant to an employee who is
not a member of the Board of Directors shall be made by the Compensation and
Benefits Committee which shall take final action on any such grant.
3. Grants may be made at any time under this Plan and in any of the forms or
combinations thereof provided in Article II hereof. A grantee may receive and
may hold more than one grant under this Plan.
4. The date on which a grant shall be deemed to have been made under this Plan
shall be the date of the Compensation and Benefits Committee (or Board of
Directors, if the grantee is a director) authorization of the grant or such
later date as may be determined by the Compensation and Benefits Committee (or
Board of Directors, if the grantee is a director) at the time the grant is
authorized. Each grantee shall be advised in writing by the Company of a grant
and the terms and conditions thereof, which terms and conditions, as the
Compensation and Benefits Committee from time to time shall determine, shall
not be inconsistent with the provisions of this Plan.
VII. OPTION PRICE
The price per share of the Company's common stock which may be purchased upon
exercise of a stock option granted under this Plan shall be determined by the
Compensation and Benefits Committee, but shall in no event be less than the
fair market value of such share on the date the stock option is granted, and in
no event less than the par value thereof. The price so determined also shall be
applicable to any accompanying stock appreciation right. For purposes of this
Plan, fair market value shall be the average of the high and low prices of the
Company's common stock as reported on the "NYSE-Composite Transactions Tape" on
the date of grant of a stock option or the date of exercise of a stock option
or stock appreciation right, or if no sales of such stock were reported on said
Tape on such date, the average of the high and low prices of such stock on the
next preceding day on which sales were reported on said Tape. Such price shall
be subject to adjustment as provided in Article XII hereof.
VIII. OPTION TERM
The term of each stock option and each stock appreciation right granted under
this Plan shall be for such period as the Compensation and Benefits Committee
shall determine, but not for more than ten years from date of grant.
IX. EXERCISE OF OPTIONS
1. Subject to the provisions of this Plan, each stock option and each stock
appreciation right granted hereunder shall be exercisable on such date or dates
and during such period and for such number of shares or stock appreciation
rights as the Compensation and Benefits Committee may determine. However, in no
event shall a stock option or stock appreciation right be exercisable prior to
six months from date of grant. The Compensation and Benefits Committee may fix
from time to time a minimum number of shares which must be purchased at the
time a stock option is exercised.
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2. A grantee electing to exercise a stock option shall at the time of
exercise pay the Company the full purchase price of the shares he or she has
elected to purchase. Payment of the purchase price shall be made in cash, the
Company's common stock (valued at fair market value on the date of exercise),
or a combination thereof, as the Compensation and Benefits Committee may
determine from time to time. A grantee electing to exercise a stock
appreciation right granted under this Plan shall so notify the Company at the
same time he or she elects to exercise an accompanying stock option. Payment by
the Company for such stock appreciation right may be in cash, common stock
(valued at fair market value on date of exercise), or a combination thereof, as
the Compensation and Benefits Committee may determine from time to time, but no
fractional share of common stock shall be delivered. With respect to shares of
the Company's common stock to be delivered upon exercise of a stock option or a
stock appreciation right, the Compensation and Benefits Committee shall
periodically determine whether, and to what extent, such stock shall be in the
form of new common stock issued for such purposes, or common stock acquired by
the Company.
3. Notwithstanding any other provision of this Plan, when the fair market
value of a share of the Company's common stock on the date a grantee elects to
exercise a stock option is less than such amount per share as may be determined
by the Compensation and Benefits Committee from time to time, the Company may
at its election pay the grantee in cash for each share he or she elected to
purchase an amount equal to the excess of such fair market value over the
option price provided for in the stock option. The Compensation and Benefits
Committee shall periodically determine whether the Company shall make such cash
payment upon exercise of a stock option. When the Company makes a payment to
the grantee under this paragraph 3 of Article IX, it shall not require the
grantee to tender the full purchase price of the shares he or she has elected
to purchase, the Company's obligation to issue or deliver such shares shall be
null and void, and the right to purchase such number of shares subject to
option shall be terminated. Such payment by the Company shall be deemed to be
an exercise of a stock option and the purchase of shares thereunder for
purposes of paragraph 3 of Article II and Article III.
X. NONTRANSFERABILITY OF GRANTS
During a grantee's lifetime no stock option or stock appreciation right
granted under this Plan shall be transferable, and stock options and stock
appreciation rights may be exercised only by the grantee.
XI. TERMINATION OF EMPLOYMENT
1. The Compensation and Benefits Committee shall, subject to the provisions of
the Plan, determine the rules relating to rights under stock options, stock
appreciation rights and restricted stock grants upon a grantee's termination of
employment.
2. A grantee shall forfeit all rights under stock options, stock appreciation
rights and restricted stock grants--
(a) if the grantee is dismissed or leaves the service of the plan companies
for any reason other than his or her death, or retirement pursuant to the
provisions of the pension or retirement plan or policy of a plan company,
or
(b) if the grantee retires pursuant to the provisions of the pension or
retirement plan or policy of a plan company, and if thereafter the
Compensation and Benefits Committee, after a hearing at which the grantee
shall be entitled to be present, shall find that he or she has willfully
engaged in any activity which is harmful to the interest of any of such
companies;
provided, however, that such stock options, stock appreciation rights and
restricted stock grants may continue in effect to such extent and under such
conditions as the Compensation and Benefits Committee may determine; and
provided, further, that the Compensation and Benefits Committee may accelerate
or waive any restrictions or conditions applicable to restricted stock grants,
in whole or in part, based on such factors and criteria as the Compensation and
Benefits Committee may determine.
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3. Upon the death of the grantee or his or her retirement pursuant to the
provisions of the pension or retirement plan or policy of a plan company,
whichever shall first occur, the number of shares subject to option and the
number of stock appreciation rights shall be limited to that number of shares
and rights which the grantee could have acquired or exercised under the terms
of his or her grant or grants on the date of such death or retirement, and the
options or rights representing the remainder of the grant or grants shall
terminate.
XII. ADJUSTMENTS
1. In the event of any stock dividend, split-up, reclassification or other
analogous change in capitalization, the Compensation and the Benefits Committee
shall make such adjustments, in the light of the change, as it deems to be
equitable, both to the grantees and to the Company, in--
(a) the number of shares and prices per share applicable to outstanding
stock options,
(b) the number of outstanding stock appreciation rights and their price,
(c) the number of shares applicable to outstanding restricted stock grants,
(d) the aggregate limitation set forth in Article III with respect to the
number of shares which may be made subject to options and restricted stock
grants.
Furthermore, in the event of a distribution to common stockholders other than
interim or year-end dividends declared as such by the Board of Directors, the
Compensation and Benefits Committee shall make such adjustments, in the light
of the distribution, as it deems to be equitable, both to the grantees and to
the Company, in respect of the items described in (a), (b) and (c) above.
2. Any fractional shares or fractional stock appreciation rights resulting from
adjustments made pursuant to this Article shall be eliminated.
XIII. AMENDMENTS
The Board of Directors reserves the right to modify this Plan from time to
time or to repeal the Plan entirely, or to direct the discontinuance of grants
either temporarily or permanently; provided, however, that no modification of
this Plan shall operate to annul, without the consent of the grantee, a grant
already made hereunder; provided, also, that no modification without approval
of the stockholders shall--
(a) increase the number of shares which may be made subject to stock
options or restricted stock grants, or the number of stock appreciation
rights which may be granted under this Plan in the aggregate, except by way
of adjustments as provided in Article XII,
(b) permit grant of stock options and stock appreciation rights at a price
less than fair market value,
(c) extend the maximum term of stock options and stock appreciation rights,
or
(d) permit a grant under this Plan to a member of the Compensation and
Benefits Committee;
except that the Board of Directors may take any action it deems advisable to
ensure that qualified stock options may be granted under this Plan in
accordance with the provisions of the Internal Revenue Code, as it may be
amended.
XIV. MISCELLANEOUS
1. The Compensation and Benefits Committee may adopt such modifications,
procedures, and subplans as may be necessary or desirable to comply with
provisions of the laws of countries other than the United States in which the
Company or a plan company may operate to assure the viability of the benefits
of grants made to employees in such countries and to meet the purposes of the
Plan.
2. Grantees may use shares of the Company's common stock to satisfy withholding
taxes relating to grants under this Plan to the extent provided in terms and
conditions established by the Compensation and Benefits Committee.
27
<PAGE>
(LOGO OF
RECYCLED Printed on Recycled Paper
PAPER (10% postconsumer waste)
APPEARS
HERE)
<PAGE>
[LOGO OF DUPONT PROXY/VOTING INSTRUCTION CARD
APPEARS HERE] E.I. DU PONT DE NEMOURS AND COMPANY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints J. A. Krol, C. S. Nicandros and E. S.
Woolard, Jr., or any of them, each with power of substitution, as proxies for
the undersigned to vote all shares of Common Stock of said Company which the
undersigned is entitled to vote at the Annual Meeting of Stockholders to be
held on April 27, 1994, and any adjournments thereof, as hereinafter specified
and, in their discretion, upon such other matters as may properly come before
the meeting. The undersigned hereby revokes all proxies heretofore given.
As described on page 1 of the proxy statement, this proxy also provides
voting instructions for shares held for the account of the undersigned in the
employee savings and stock ownership plans. A trustee for these plans will vote
these shares as directed provided you sign and return a proxy by April 20,
1994. A trustee for the employee savings plan may vote in its discretion all
shares held in these plans for which no voting instructions are received.
Shares held through the employee stock ownership plans will be voted for you
only if you sign and return a proxy. Other shares owned by you will be voted
only if you sign and return a proxy, or attend the meeting and vote by ballot.
On matters for which you do not specify a choice, your shares will be
voted in accordance with the recommendation of the Board of Directors.
1. Election of Directors (mark only one)
[ ] Vote FOR all nominees listed [ ] Vote WITHHELD from all
below and recommended by the nominees
Board of Directors (except as
directed to the contrary below)
P. N. Barnevik; A. F. Brimmer; C. R. Bronfman; E. M. Bronfman; E. Bronfman,
Jr.; L. C. Duemling; E. B. du Pont; C. M. Harper; J. A. Krol; M. P. MacKimm;
C. S. Nicandros; W. K. Reilly; H. R. Sharp, III; C. M. Vest; J. L. Weinberg;
E. S. Woolard, Jr.
INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
(continued, and to be signed, on other side)
<PAGE>
(continued from other side)
The Board of Directors recommends a vote "FOR" Board proposals Nos. 2 and 3:
NO.
For Against Abstain
2. On independent accountants [ ] [ ] [ ]
3. On Stock Performance Plan amendment [ ] [ ] [ ]
The Board of Directors recommends a vote "AGAINST" the following
stockholder proposals:
For Against Abstain
4. On political non-partisanship [ ] [ ] [ ]
5. On cumulative voting [ ] [ ] [ ]
6. On site listing [ ] [ ] [ ]
PLEASE SIGN, DATE
AND RETURN THIS
PROXY, USING THE
ENCLOSED POSTAGE [ ] Please check to receive
PREPAID ENVELOPE. an admission ticket to the
meeting.
Dated , 1994 SIGN HERE
----------------- ---------------------
Number used for When signing as attorney, executor, administrator, trustee
machine counting or guardian, please give full title as such. If the signer
of the vote is a corporation, sign the full corporate name by duly
authorized officer.
