SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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 Section 240.14a-11(c) or Section
240.14a-12
Ethyl Corporation
(Name of Registrant as Specified in its Charter)
Board of Directors of Ethyl Corporation
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
(X) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(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(i)(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) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for 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) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
[PASTE-UP ADDRESS]
ANNUAL MEETING OF SHAREHOLDERS
March 29, 1994
To the Shareholders:
We enclose our annual report describing Ethyl's operations during the past
year. We hope you read this report, which summarizes major corporate
developments during the year.
We cordially invite you to attend the annual meeting of shareholders to be
held in the RESTORED GUN FOUNDRY BUILDING OF THE TREDEGAR IRON WORKS, 500
TREDEGAR STREET, in Richmond, Virginia, on Thursday, April 28, 1994, at 11:00
A.M., Eastern Daylight Time. A formal notice of the meeting, together with a
proxy statement and proxy form, is enclosed with this letter. The notice points
out that you will be asked to elect a Board of Directors, amend the
Corporation's stock option plan to (i) increase the number of shares issuable
under the plan and (ii) establish an annual limit on individual option awards
and approve the designation of auditors for the coming year.
Please read the notice and proxy statement carefully, complete the proxy form
and mail it promptly.
Sincerely yours,
BRUCE C. GOTTWALD
CHAIRMAN OF THE BOARD
AND CHIEF EXECUTIVE
OFFICER
<PAGE>
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the
Annual Meeting of the holders of
shares of Common Stock of Ethyl
Corporation (the Corporation) will be
held in the RESTORED GUN FOUNDRY
BUILDING OF THE TREDEGAR IRON WORKS,
500 TREDEGAR STREET, Richmond,
Virginia, on Thursday, April 28, 1994,
at 11:00 A.M., Eastern Daylight Time,
for the following purposes:
1. To elect a Board of Directors
to serve for the ensuing
year;
2. To amend the Corporation's
stock option plan to (i)
increase the number of shares
issuable under the plan and
(ii) establish an annual
limit on individual option
awards;
3. To approve the designation by
the Board of Directors of
Coopers & Lybrand as auditors
for the fiscal year ending
December 31, 1994; and
4. To transact such other
business as may properly come
before the meeting.
Holders of shares of Ethyl Common
Stock of record at the close of
business on March 14, 1994, will be
entitled to vote at the meeting.
You are requested to fill in,
sign, date and return the enclosed
proxy promptly, regardless of whether
you expect to attend the meeting. A
postage-paid return envelope is
enclosed for your convenience.
If you are present at the
meeting, you may vote in person even
if you have already sent in your
proxy.
By Order of the Board of
Directors
E. WHITEHEAD ELMORE, SECRETARY
March 29, 1994
<PAGE>
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
ETHYL CORPORATION
TO BE HELD APRIL 28, 1994
APPROXIMATE DATE OF MAILING -- MARCH 29, 1994
Proxies in the form enclosed are solicited by the Board of Directors for
the Annual Meeting of Shareholders to be held on Thursday, April 28, 1994. Any
person giving a proxy may revoke it at any time before it is voted by delivering
another proxy, or written notice of revocation, to the Secretary of the
Corporation. A proxy, if executed and not revoked, will be voted, and, if it
contains any specific instructions, will be voted in accordance with such
instructions.
On March 14, 1994, the date for determining shareholders entitled to vote
at the meeting, there were outstanding 118,414,769 shares of Ethyl Common Stock.
Each share of Ethyl Common Stock is entitled to one vote.
The cost of the solicitation of proxies will be borne by the Corporation.
In addition to the use of the mails, proxies may be solicited personally or by
telephone by regular employees of the Corporation. Corporate Investor
Communications, Inc., has been engaged to assist in the solicitation of proxies
from brokers, nominees, fiduciaries and other custodians. The Corporation will
pay that firm $7,000 for its services and reimburse its out-of-pocket expenses.
The Corporation's address is 330 South Fourth Street, Richmond, Virginia
23219.
ELECTION OF DIRECTORS
Proxies will be voted for the election as directors for the ensuing year
of the persons named below (or if for any reason unavailable, of such
substitutes as the Board of Directors may designate). The Board of Directors has
no reason to believe that any of the nominees will be unavailable.
Three directors who currently serve on the Board of Directors are retiring
this year: Lawrence E. Blanchard, Jr., Joseph C. Carter, Jr., and George T.
Stewart III. M. F. Gautreaux, who served on the Board during 1993, passed away
in February 1994. Ronald V. Dolan and E. Gary Cook, who also served on the Board
during 1993, will not stand for reelection because of their other commitments as
presidents of First Colony Corporation and Albemarle Corporation, respectively.
The election of each nominee for director requires the affirmative vote of
the holders of a plurality of the shares of Common Stock in the election of
directors. Votes that are withheld and shares held in street name (Broker
Shares) that are not voted in the election of directors will not be included in
determining the number of votes cast. Unless otherwise specified in the
accompanying form of proxy, it is intended that votes will be cast for the
election of all of the nominees as directors.
LLOYD B. ANDREW; age 70; director since 1984; retired, former Executive Vice
President and Chief Financial Officer of the Corporation (1984-1989). Other
directorship: Albemarle Corporation.
1
<PAGE>
WILLIAM W. BERRY; age 62; director since 1983; retired, former Chairman of the
Board of Dominion Resources, Inc. (holding company for Virginia Power
Company) (1986-1992); retired Chairman of the Board of Virginia Power
Company (public utility) (1986-1992). Other directorships: Albemarle
Corporation, Dominion Resources, Inc., Scott & Stringfellow, Inc.,
Universal Corporation and Virginia Power Company.
ALLEN C. GOOLSBY; age 54, nominee for director; Partner, Hunton & Williams
(attorneys). Other directorship: Noland Company.
BRUCE C. GOTTWALD; age 60; director since 1962; Chairman of the Board, Chairman
of the Executive Committee and Chief Executive Officer since March 1, 1994,
having served as President, Chief Executive Officer and Chief Operating
Officer of the Corporation from April 23, 1992, and having previously
served as President and Chief Operating Officer of the Corporation. Other
directorships: Albemarle Corporation, CSX Corporation, Dominion Resources,
Inc., First Colony Corporation, James River Corporation and Tredegar
Industries, Inc.
BRUCE C. GOTTWALD, JR.; age 36; director since 1992; Chairman of the Board and
Chief Executive Officer of First Colony Corporation since October 8, 1992;
Vice President and Treasurer of the Corporation from February 27, 1992 to
July 1, 1993, having served as Treasurer (August 1, 1989February 26, 1992),
Assistant Corporate Controller (April 1, 1989July 31, 1989) and Assistant
Treasurer (August 1, 1988March 31, 1989) of the Corporation prior thereto.
Other directorships: Albemarle Corporation, First Colony Corporation and
Paragon Portfolio.
FLOYD D. GOTTWALD, JR.; age 71; director since 1956; Chairman of the Board and
Chief Executive Officer of Albemarle Corporation since March 1, 1994; Vice
Chairman of the Board of the Corporation since March 1, 1994, having served
as Chairman of the Board and Chairman of the Executive Committee of the
Corporation from April 23, 1992, and having previously served as Chairman
of the Board, Chairman of the Executive Committee and Chief Executive
Officer. Other directorships: Albemarle Corporation, First Colony
Corporation and Tredegar Industries, Inc.
THOMAS E. GOTTWALD; age 33; director since March 1, 1994; President and Chief
Operating Officer of the Corporation since March 1, 1994, having served as
Vice President of the Corporation from August 1, 1991 to March 1, 1994; and
as General Manager of Tredegar Film Products, a division of Tredegar
Industries, Inc., prior thereto.
WILLIAM M. GOTTWALD, MD; age 46; director since 1992; Senior Vice President of
the Corporation since March 1, 1994, having served as Vice President of the
Corporation since November 1, 1988, and as Chairman of the Board and
President of the Corporation's pharmaceuticals subsidiary since April 27,
1987. Other directorships: Albemarle Corporation and First Colony
Corporation.
GILBERT M. GROSVENOR; age 62; director since 1985; President and Chairman of the
National Geographic Society (magazine publisher and scientific society).
Other directorships: Albemarle Corporation, Chesapeake and Potomac
Telephone Company, Chevy Chase Savings Bank (FSB), Charles Allmon Trust,
Inc., B.F. Saul Real Estate Investment Trust, Saul Centers, Inc. and
Marriott International, Inc.
ANDRE B. LACY; age 54; director since 1981; Chairman of the Board (since 1992),
Chief Executive Officer and President of LDI Management, Inc., Managing
General Partner, LDI, Ltd. (industrial and investment limited partnership).
Other directorships: Albemarle Corporation, First Colony Corporation,
IPALCO Enterprises, Inc., Patterson Dental Co. and Tredegar Industries,
Inc.
2
<PAGE>
EMMETT J. RICE; age 74; director since 1988; retired, former member of the Board
of Governors of the Federal Reserve System. Other directorships: Albemarle
Corporation, Tredegar Industries, Inc., and Jardine-
Fleming China Region Fund.
SIDNEY BUFORD SCOTT; age 61; director since 1959; Chairman of the Board of Scott
& Stringfellow, Inc. (investment bankers and brokers). Other directorships:
Albemarle Corporation and Great Eastern Energy & Development Corporation.
CHARLES B. WALKER; age 55; director since 1989; Vice Chairman of the Board and
Chief Financial Officer since March 1, 1994, having served as Executive
Vice President and Chief Financial Officer of the Corporation since August
1, 1989, Executive Vice President, Chief Financial Officer and Treasurer of
the Corporation (February 1, 1989July 31, 1989), and Executive Vice
President and Treasurer of the Corporation (November 1, 1988January 31,
1989); and Vice Chairman of the Board and Chief Financial Officer of
Albemarle Corporation since March 1, 1994. Other directorships: Albemarle
Corporation, First Colony Corporation and Nations Fund Trust/Nations Fund,
Inc.
In 1993, each director attended at least 75% of the aggregate of (i) the
total number of meetings of all committees of the Board on which the director
then served and (ii) the total number of meetings of the Board of Directors held
during 1993 while he was a member of the Board of Directors, except for Messrs.
Berry and Stewart. Seven meetings of the Corporation's Board of Directors were
held during 1993.
In 1993 the Corporation's executive committee consisted of Messrs. Bruce C.
Gottwald, Floyd D. Gottwald, Jr., and Charles B. Walker. Thomas E. Gottwald and
William M. Gottwald were added to the Executive Committee as of March 1, 1994.
The executive committee acts not only as the executive committee of the Board of
Directors but also as the Corporation's principal management committee. During
1993, the executive committee met on 10 occasions as the executive committee of
the Board of Directors and on 19 occasions as the principal management
committee.
Messrs. Berry, Blanchard, Grosvenor, Lacy and Scott serve on the
Corporation's audit committee. During 1993, the audit committee met on two
occasions. The audit committee reviews the Corporation's internal audit and
financial reporting functions and the scope and results of the audit performed
by the Corporation's independent accountants and matters relating thereto and
reports thereon to the Board of Directors. The audit committee also recommends
to the Board of Directors the engagement of the independent accountants of the
Corporation.
The Corporation's nominating committee currently consists of Messrs. Floyd
D. Gottwald, Jr., Blanchard, Carter, Lacy and Scott. Mr. Blanchard was added to
the Committee on April 22, 1993. During 1993, the nominating committee met on
one occasion. The nominating committee recommends candidates for election as
directors and in some cases the election of officers. The Corporation's bylaws
provide that a shareholder of the Corporation entitled to vote for the election
of directors may nominate persons for election to the Board by mailing written
notice to the Secretary of the Corporation not later than (i) with respect to an
election to be held at an annual meeting of shareholders, 60 days prior to such
meeting, and (ii) with respect to an election to be held at a special meeting of
shareholders for the election of directors, the close of business on the seventh
day following the date on which notice of such meeting is first given to
shareholders. Such shareholder's notice shall include (i) the name and address
of the shareholder and of each person to be nominated, (ii) a representation
that the shareholder is a holder of record of stock of the Corporation entitled
to vote at such meeting and intends to appear in person or by proxy at the
meeting to nominate each person specified, (iii) a description of all
understandings between the shareholder and each nominee and any other person
(naming such person) pursuant to which the nomination is to be made by the
shareholder, (iv) such other information regarding each nominee as would be
required to be included in a proxy statement filed pursuant to the proxy rules
of the Securities and Exchange
3
<PAGE>
Commission, had the nominee been nominated by the Board of Directors and (v) the
consent of each nominee to serve as a director of the Corporation if so elected.
Messrs. Andrew, Carter and Rice currently serve as the Corporation's
bonus, salary and stock option committee. Mr. Blanchard served on the bonus,
salary and stock option committee until April 22, 1993, and Dr. Gautreaux served
on the bonus, salary and stock option committee until his death. During 1993,
the bonus, salary and stock option committee met on seven occasions. This
committee approves the salaries of management-level employees. It also approves
all bonus awards, certain consultant agreements and initial salaries of new
management-level personnel, and grants options under the Corporation's Incentive
Stock Option Plan.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Floyd D. Gottwald, Jr. and Bruce C. Gottwald are brothers. William M.
Gottwald, MD, a director and Senior Vice President of the Corporation, is a son
of Floyd D. Gottwald, Jr. Thomas E. Gottwald, a director and President of the
Corporation, and Bruce C. Gottwald, Jr., a director, are sons of Bruce C.
Gottwald. The Gottwalds may be deemed to be control persons of the Corporation.
Hunton & Williams regularly acts as counsel to the Corporation. Allen C.
Goolsby, a nominee for director of the Corporation, is a Partner in Hunton &
Williams.
For the purpose of governing certain of the ongoing relationships between
the Corporation and Albemarle Corporation after the spin-off of Albemarle
Corporation's Common Stock by the Corporation and to provide mechanisms for an
orderly transition, the Corporation and Albemarle Corporation have entered into
various agreements, including a reorganization agreement, an employee benefits
agreement, a tax sharing agreement, a master services agreement and an
indemnification agreement, that provide for the allocation of assets, resources,
employees, benefit plans, taxes, liabilities and certain administrative and
other services between the Corporation and Albemarle Corporation. In addition,
the Corporation and Albemarle Corporation entered into agreements relating to
plant facilities of the Corporation and Albemarle Corporation that are
interconnected as well as supply agreements and related licensing agreements.
Because of the interrelationship between the adjoining operations of the
Corporation and Albemarle Corporation, agreements were necessary to provide for
the ongoing operation of these plants. These agreements cover the provision of
administrative, manufacturing, storage and other services and utilities and, in
some cases, the lease of real property at the shared facilities, with negotiated
fees and charges imposed. Messrs. Floyd D. Gottwald, Jr., Charles B. Walker and
E. Whitehead Elmore also are executive officers of Albemarle Corporation.
Ronald V. Dolan's wife, MaryJane Dolan, is the sole owner of Colonial
Brokerage House, Inc., an independent brokerage general agency in Lynchburg,
Virginia, that represents various insurance companies, including First Colony
Life Insurance Company (First Colony Life), a subsidiary of First Colony
Corporation (First Colony). Until July 1, 1993, the Corporation held
approximately 80% of the outstanding shares of common stock of First Colony.
During the first six months of 1993, Colonial Brokerage received approximately
$267,000 in brokerage commissions from First Colony Life.
Based solely on its review of the forms required by Section 16(a) of the
Securities Exchange Act of 1934 that have been received by the Corporation, the
Corporation believes that all filing requirements applicable to its officers,
directors and beneficial owners of greater than 10% of its Common Stock have
been complied with except that Bruce C. Gottwald, Jr., inadvertently neglected
to include in his Initial Statement of Beneficial Ownership on Form 3 and in
subsequent filings certain shares of Common Stock held by his wife. He included
those shares in his Form 5 for 1993, which was filed in a timely manner.
4
<PAGE>
STOCK OWNERSHIP
The following table lists any person (including any group as that term is
used in Section 13(d)(3) of the Securities Exchange Act of 1934) who, to the
knowledge of the Corporation, was the beneficial owner as of January 31, 1994,
of more than 5% of the outstanding voting shares of the Corporation.
<TABLE>
<CAPTION>
TITLE OF NAME AND ADDRESS OF NUMBER OF
CLASS BENEFICIAL OWNERS SHARES PERCENT OF CLASS
<S> <C> <C> <C>
Common Stock Floyd D. Gottwald, Jr., 21,107,318(b)(c) 17.82%
and Bruce C. Gottwald (a)
330 South Fourth Street
P.O. Box 2189
Richmond, Virginia 23217
NationsBank Corporation and 9,950,762 8.4%
related entities (d)
c/o NationsBank Corporation
NationsBank Plaza
Charlotte, North Carolina 28255
</TABLE>
(a) Floyd D. Gottwald, Jr., and Bruce C. Gottwald (the Gottwalds),
together with members of their immediate families, may be deemed to be a group
for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934,
although there is no agreement among them with respect to the acquisition,
retention, disposition or voting of Ethyl Common Stock.
(b) The Gottwalds, individually or collectively, have sole voting and
investment power over all of the shares disclosed except 9,277,012 shares held
by wives, children, and in certain trust relationships, some of which might be
deemed to be beneficially owned by the Gottwalds under the rules and regulations
of the Securities and Exchange Commission, but as to which the Gottwalds
disclaim beneficial ownership. Shares owned by the adult children of Floyd D.
Gottwald, Jr., and Bruce C. Gottwald are included in the holdings of the
Gottwalds as a group, but are not attributed to Floyd D. Gottwald, Jr., or Bruce
C. Gottwald other than in this table. This amount includes 60,670 shares of
Ethyl Common Stock, with respect to which the Gottwalds or members of their
immediate families have the right to acquire beneficial ownership within 60 days
of January 31, 1994, pursuant to the Corporation's Stock Option Plan.
(c) This amount includes shares owned by Bruce C. Gottwald, Jr., a
director of the Corporation, and by Thomas E. Gottwald, President of the
Corporation, both of whom are sons of Bruce C. Gottwald. Also included are
shares held by William M. Gottwald, M.D., a Senior Vice President and director
of the Corporation and the son of Floyd D. Gottwald, Jr. See the table on page 6
for information on the share ownership of each member of the Gottwald family who
is an executive officer or director of the Corporation. This amount also
includes any shares owned of record by NationsBank of Virginia, N.A., as Trustee
under the Corporation's savings plan for the benefit of the Gottwalds and the
members of their immediate families. This amount does not include 7,830,481
shares held by the Trustee of such plan for the benefit of other employees.
Shares held under the savings plan are voted by the Trustee in accordance with
instructions solicited from employees participating in the plan. If a
participating employee does not give the Trustee voting instructions, his shares
are voted by the Trustee in accordance with the Board of Directors'
recommendations to the shareholders. Because the Gottwalds are executive
officers, directors and the largest shareholders of the Corporation, they may be
deemed to be control persons of the Corporation and to have the capacity to
control any such recommendation of the Board of Directors.
(d) The NationsBank Corporation related entities are American Security
Corporation, ASB Capital Management, Inc., American Security Bank, Security
Trust Company, N.A., C&S/Sovran Corporation, NationsBank
5
<PAGE>
of Florida, N.A., NationsBank of Georgia, N.A., NationsBank of Maryland, N.A.,
NationsBank of South Carolina, N.A., NationsBank of Tennessee, N.A., NationsBank
of Virginia, N.A., NationsBank of North Carolina, N.A., NationsBank Texas
Corporation, NationsBank Texas Bancorporation, Inc., and NationsBank of Texas,
N.A. The information contained herein with respect to NationsBank Corporation
and the related entities listed herein is based on a Schedule 13G filed by such
entities with the Securities and Exchange Commission, a copy of which was
received by the Corporation on February 16, 1994. Such filing further stated
that the acquisition of such shares was in the ordinary course of business and
not in connection with or as a participant in any transaction having the purpose
or effect of changing or influencing the control of the Corporation. The shares
held by NationsBank Corporation and related entities are held in fiduciary
accounts.
The following table sets forth as of January 31, 1994, the beneficial
ownership of Ethyl Common Stock by all directors, and nominees, of the
Corporation, the Chief Executive Officer and the four next most highly
compensated executive officers and all directors and executive officers of the
Corporation as a group. Unless otherwise indicated, each person listed below has
sole voting and investment power over all shares beneficially owned by him.
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES TOTAL
NAME OF BENEFICIAL OWNER WITH SOLE VOTING AND WITH SHARED VOTING NUMBER PERCENT OF
OR NUMBER OF PERSONS IN GROUP INVESTMENT POWER (1) AND INVESTMENT POWER OF SHARES CLASS (2)
<S> <C> <C> <C> <C>
Lloyd B. Andrew 55,305 0 55,305
William W. Berry 1,231 1,689(3) 2,920
Lawrence E. Blanchard, Jr. 122,892 8,000(4) 130,892
Joseph C. Carter, Jr. 9,404 0 9,404
E. Gary Cook 38,233 0 38,233
Ronald V. Dolan 44,655 1,728(5) 46,383
E. Whitehead Elmore 189,587 0 189,587
Allen C. Goolsby 500 2,024 2,524
Bruce C. Gottwald 8,231,484 451,267 8,682,751 (6) 7.33%
Bruce C. Gottwald, Jr. 638,491 1,098,240(7) 1,736,731 (7) 1.47%
Floyd D. Gottwald, Jr. 3,610,591 5,718,453 9,329,044 (8) 7.88%
Thomas E. Gottwald 566,753 1,108,463(9) 1,662,001 (9) 1.40%
William M. Gottwald, MD 575,272 5,965,643(10) 6,540,915 (10) 5.52%
Gilbert M. Grosvenor 2,570 0 2,570
Andre B. Lacy 1,419 954,483(11) 955,902
Emmett J. Rice 670 0 670
Sidney Buford Scott 64,870 37,500(12) 102,370
George T. Stewart III 57,424 440(13) 57,864
Charles B. Walker 152,349 0 152,349
Directors and executive officers
as a group (34 persons) 14,824,123 7,034,878 21,859,001 18.39%
</TABLE>
(1) The amounts in this column include shares of Ethyl Common Stock with
respect to which certain persons have the right to acquire beneficial
ownership within 60 days of January 31, 1994, pursuant to the
Corporation's Stock Option Plan: Dr. Cook: 35,575 shares; Mr. Elmore:
20,623 shares; B. C. Gottwald: 23,043; F. D. Gottwald, Jr.: 23,043 shares;
T. E. Gottwald: 9,576 shares; W. M. Gottwald: 5,008 shares; C. B. Walker:
98,018 shares; and directors and executive officers as a group: 449,511
shares.
(2) In accordance with the rules of the Securities and Exchange Commission
some shares are attributed to more than one member of the Gottwald
families, but are counted only once in the information provided for
6
<PAGE>
directors and executive officers as a group. Except as indicated, each
person or group owns less than 1% of Ethyl Common Stock.
(3) Mr. Berry disclaims beneficial ownership of all 1,689 of such shares.
(4) Mr. Blanchard disclaims beneficial ownership of all 8,000 of such shares.
(5) Mr. Dolan disclaims beneficial ownership of all 1,728 of such shares.
(6) Mr. Gottwald disclaims beneficial ownership of 3,638,368 of such shares.
(7) Mr. Gottwald disclaims beneficial ownership of 1,140,200 of such shares.
This amount includes 1,062,033 shares of Ethyl Common Stock that Mr.
Gottwald may be deemed to own beneficially. Such shares constitute Mr.
Gottwald's interest as beneficiary of a trust of which Floyd D. Gottwald,
Jr., is trustee.
(8) Mr. Gottwald disclaims beneficial ownership of 4,084,614 of such shares.
(9) Mr. Gottwald disclaims beneficial ownership of 1,123,859 of such shares.
This amount includes 1,062,033 shares of Ethyl Common Stock that Mr.
Gottwald may be deemed to own beneficially. Such shares constitute Mr.
Gottwald's interest as beneficiary of a trust of which Floyd D. Gottwald,
Jr., is trustee.
(10) Dr. Gottwald disclaims beneficial ownership of 6,088,745 of such shares.
This amount includes 1,062,033 shares of Ethyl Common Stock that Dr.
Gottwald may be deemed to own beneficially. Such shares constitute Dr.
Gottwald's interest as beneficiary of a trust of which Bruce C. Gottwald
is trustee. This amount also includes 4,816,940 shares of Ethyl Common
Stock that Dr. Gottwald may be deemed to own beneficially as co-trustee of
a trust for the benefit of Floyd D. Gottwald, Jr.
(11) Mr. Lacy disclaims beneficial ownership of 713,693 of such shares.
(12) Mr. Scott disclaims beneficial ownership of all 37,500 of such shares.
(13) Mr. Stewart disclaims beneficial ownership of all 440 of such shares.
7
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
The following table presents information relating to total compensation of
the Chief Executive Officer and the four next most highly compensated executive
officers of the Corporation for the fiscal years ended December 31, 1993, 1992
and 1991.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION OPTIONS/
OTHER ANNUAL SARS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION1 (POUND)2 COMPENSATION
<S> <C> <C> <C> <C> <C> <C>
Bruce C. Gottwald 1993 $770,000 $265,000 $ -- 30,608 $ 38,5003
President, Chief Executive 1992 700,833 291,750 -- 3,300 33,937
Officer and Chief 1991 652,000 268,438 N/A 3,850 31,850
Operating Officer
Floyd D. Gottwald, Jr. 1993 754,000 260,000 -- 30,608 21,9924
Chairman of the Board 1992 736,500 286,750 -- 3,300 36,913
and Executive Committee 1991 695,000 272,438 N/A 3,850 34,775
Charles B. Walker 1993 391,000 225,000 -- 98,018 19,5505
Executive Vice President 1992 375,167 251,750 -- 3,300 18,883
and Chief Financial Officer 1991 353,000 182,438 N/A 43,850 17,662
E. Gary Cook 1993 368,000 200,000 -- 66,109 18,4008
Senior Vice President 1992 353,000 226,7506 207,7797 43,300 16,996
1991 N/A N/A N/A N/A N/A
E. Whitehead Elmore 1993 270,000 100,000 -- 20,623 13,5009
Vice President, Secretary and 1992 259,200 111,400 -- 3,300 12,158
General Counsel 1991 242,833 87,350 N/A 3,500 12,142
</TABLE>
1 None of the named executive officers received Other Annual Compensation for
1993 in excess of the lesser of $50,000 or 10% of combined salary and bonus
for 1993.
2 All options granted in 1993 were granted to replace previously granted options
pursuant to the anti-dilution provisions of the Corporation's Incentive Stock
Option Plan in connection with the spin-off of First Colony Corporation.
3 Includes contributions to the Corporation's savings plan ($10,000, $10,000 and
$10,000) and accruals in the Corporation's excess benefit plan ($28,500,
$23,937 and $21,850) for 1993, 1992 and 1991, respectively.
4 Includes contributions to the Corporation's savings plan ($10,000, $10,000 and
$10,000) and accruals in the Corporation's excess benefit plan ($11,922,
$26,913 and $24,775) for 1993, 1992 and 1991, respectively.
5 Includes contributions to the Corporation's savings plan ($10,000, $10,000 and
$10,000) and accruals in the Corporation's excess benefit plan ($9,550, $8,883
and $7,662) for 1993, 1992 and 1991, respectively.
6 In connection with Dr. Cook's employment with the Corporation as of January 1,
1992, the Corporation agreed to pay Dr. Cook a bonus of at least $200,000 for
each of 1992 and 1993.
7 In connection with Dr. Cook's employment with the Corporation, the Corporation
agreed to: (i) grant Dr. Cook options to purchase 40,000 shares of Ethyl
Common Stock; (ii) reimburse Dr. Cook for the value of his non-vested options
to purchase shares of common stock of E.I. du Pont de Nemours and Company (du
Pont) ($162,750); (iii) provide Dr. Cook with a car and certain club
memberships ($17,300); and (iv) reimburse Dr. Cook for expenses connected with
his relocation to Baton Rouge, Louisiana ($48,200). Also in connection with
Dr. Cook's employment with the Corporation, the Corporation agreed to pay and
paid Dr. Cook $200,000 during the first quarter of 1992 to compensate him for
the loss of incentive compensation for service in 1991 with du Pont.
8 Includes contributions to the Corporation's savings plan ($10,000 and $10,000)
and accruals in the Corporation's excess benefit plan ($8,400 and $6,996) for
1993 and 1992, respectively.
9 Includes contributions to the Corporation's savings plan ($10,000, $10,000 and
$10,000) and accruals in the Corporation's excess benefit plan ($3,500, $2,958
and $2,142) for 1993, 1992 and 1991, respectively.
8
<PAGE>
The following tables present information concerning stock options and stock
appreciation rights (SARs) granted to the Chief Executive Officer and the four
next most highly compensated executive officers of the Corporation and exercises
of options and SARs by such persons.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
All options granted during 1993 were granted to replace previously granted
options pursuant to the anti-dilution provisions of the Company's Incentive
Stock Option Plan in connection with the spin-off of First Colony Corporation.
Each of these options relates to Ethyl Common Stock and includes a tandem SAR.
No new options were granted in 1993. This information does not reflect
adjustments made to the exercise price and number of options as of March 1,
1994, to reflect the spin-off of Albemarle Corporation.
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE
VALUE AT
ASSUMED
ANNUAL
RATES OF
STOCK
PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR
OPTIONS/SARS % OF TOTAL OPTIONS/SARS EXERCISE OR OPTION
GRANTED GRANTED TO EMPLOYEES IN BASE PRICE TERM
NAME (POUND) FISCAL YEAR ($ SH) EXPIRATION DATE 5% ($)
<S> <C> <C> <C> <C> <C>
Bruce C. Gottwald 7,5651 1.09% $ 14.54 09/21/93 $ 30,359
5,7802 0.84% 18.92 09/14/94 30,183
6,3933 0.92% 15.94 11/04/95 28,126
5,8624 0.85% 18.65 12/18/96 30,174
5,0085 0.72% 20.73 12/30/97 28,653
Floyd D. Gottwald, Jr. 7,5651 1.09% 14.54 09/21/93 30,359
5,7802 0.84% 18.92 09/14/94 30,183
6,3933 0.92% 15.94 11/05/95 28,126
5,8624 0.85% 18.65 12/18/96 30,174
5,0085 0.72% 20.73 12/30/97 28,653
Charles B. Walker 8,8456 1.28% 16.48 09/23/97 91,687
5,6321 0.81% 13.22 09/21/98 46,832
5,3182 0.77% 17.20 09/14/99 57,534
6,3873 0.92% 14.49 11/05/00 58,212
5,8644 0.85% 16.96 12/18/01 62,556
60,9314 8.80% 16.96 12/18/01 650,002
5,0415 0.73% 18.85 12/30/02 59,769
E. Gary Cook 61,0687 8.82% 18.44 12/31/01 708,313
5,0415 0.73% 18.85 12/30/02 59,769
E. Whitehead Elmore 5,2376 0.76% 16.48 09/23/97 54,286
5,0142 0.72% 17.20 09/14/99 54,245
5,3314 0.77% 16.96 12/18/01 56,870
5,0415 0.73% 18.85 12/30/02 59,769
<CAPTION>
NAME 10% ($)
<S> <C>
Bruce C. Gottwald $ 67,207
66,817
62,264
66,798
63,431
Floyd D. Gottwald, Jr. 67,207
66,817
62,264
66,798
63,431
Charles B. Walker 232,350
118,681
145,803
147,521
158,529
1,647,223
151,466
E. Gary Cook 1,794,994
151,466
E. Whitehead Elmore 137,571
137,468
144,120
151,466
</TABLE>
1 Became exercisable on 9/22/89.
2 Became exercisable on 9/15/90.
3 Became exercisable on 11/05/91.
4 Became exercisable on 12/19/92.
5 Became exercisable on 12/31/93.
6 Became exercisable on 9/24/88.
7 One-half became exercisable on 1/1/93 and one-half became exercisable on
1/1/94.
9
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR,
AND FY-END OPTION/SAR VALUE
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
SHARES ACQUIRED OPTIONS/SARS AT FY-END IN-THE-MONEY OPTIONS/SARS
ON EXERCISE VALUE (POUND)1 AT FY-END ($)2
NAME (POUND) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C> <C> <C>
Bruce C. Gottwald 7,565 28,066 23,043 -- 9,973 --
Floyd D. Gottwald, Jr. 7,565 28,066 23,043 -- 9,973 --
Charles B. Walker -- -- 98,018 -- 90,017 --
E. Gary Cook -- -- 35,575 30,534 -- --
E. Whitehead Elmore 3,553 14,990 20,623 -- 9,775 --
</TABLE>
1 Each of these options relates to Ethyl Common Stock and includes a tandem SAR.
2 These values are based on $17.50, the closing price of Ethyl Common Stock on
the New York Stock Exchange on December 31, 1993.
RETIREMENT BENEFITS
The following table illustrates under the Corporation's pension plan for
salaried employees the estimated benefits upon retirement at age 65, determined
as of December 31, 1993, to persons with specified earnings and years of pension
benefit service. To the extent benefits payable at retirement exceed amounts
that may be payable under applicable provisions of the Internal Revenue Code,
they will be paid under the Corporation's excess benefit or supplemental
retirement plans, as applicable. This table includes the amounts that would be
payable under such plans.
ESTIMATED ANNUAL BENEFITS PAYABLE AT RETIREMENT*
<TABLE>
<CAPTION>
YEARS OF PENSION BENEFIT SERVICE AND ESTIMATED ANNUAL BENEFITS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FINAL-AVERAGE EARNINGS 10 15 20 25 30 35 40 50
$ 300,000 44,090 66,135 88,180 110,230 132,275 154,320 176,365 220,455
350,000 51,590 77,385 103,180 128,980 154,775 180,570 206,365 257,955
400,000 59,090 88,635 118,180 147,730 177,275 206,820 236,365 295,455
450,000 65,590 99,885 133,180 166,480 199,775 233,070 266,365 332,955
500,000 74,090 111,135 148,180 185,230 222,275 259,320 296,365 370,455
550,000 81,590 122,385 163,180 203,980 244,775 285,570 326,365 407,955
600,000 89,090 133,635 178,180 222,730 267,275 311,820 356,365 445,455
650,000 96,590 144,885 193,180 241,480 289,775 338,070 386,365 482,955
700,000 104,090 156,135 208,180 260,230 312,275 364,320 416,365 520,455
750,000 111,590 167,385 223,180 278,980 334,775 390,570 446,365 557,955
800,000 119,090 178,635 238,180 297,730 357,275 416,820 476,365 595,455
850,000 126,590 189,885 253,180 316,480 379,775 443,070 506,365 632,955
900,000 134,090 201,135 268,180 335,230 402,275 469,320 536,365 670,455
950,000 141,590 212,385 283,180 253,980 424,775 495,570 566,365 707,955
1,000,000 149,090 223,635 298,180 372,730 447,275 521,820 596,365 745,455
</TABLE>
* Assumes attainment of age 65 in 1993 and Social Security Covered
Compensation of $22,716.
10
<PAGE>
The benefit formula under the pension plans is based on the participant's
final-average earnings, which are defined as the average of the highest three
consecutive calendar years' earnings (base pay plus 50% of incentive bonuses
paid in any fiscal year) during the 10 consecutive calendar years immediately
preceding the date of determination. The years of pension benefit service for
each of the executive officers named in the above compensation table as of
December 31, 1993, are: Floyd D. Gottwald, Jr., 50.500; Bruce C. Gottwald,
37.750; Charles B. Walker, 12.665; E. Gary Cook, 2.000; and E. Whitehead Elmore,
24.1667.
Benefits under the pension plans are computed on the basis of a life
annuity with 60 months guaranteed payments. The benefits listed in the above
compensation table are not subject to deduction for Social Security or other
offset payments.
EXCESS BENEFIT AND SUPPLEMENTAL RETIREMENT PLANS
The Corporation maintains excess benefit and supplemental retirement plans
(the Supplemental Plans) in the form of nonqualified pension plans that provide
eligible individuals the difference between the benefits they actually accrue
under the qualified employee pension and savings plans of the Corporation and
the benefits they would have accrued under such plans, but for the maximum
benefit and annual addition limitations and the limitation on compensation that
may be recognized thereunder, under the Internal Revenue Code. In addition, on
the recommendation of the Executive Committee of the Corporation's Board of
Directors and with the approval of the bonus, salary and stock option committee,
certain key employees may be granted additional pension benefits under the
Supplemental Plans in cases where relatively short service would limit the key
employee's career retirement benefits. Such additional pension benefits have
been granted to Charles B. Walker and E. Gary Cook. All benefits under the
Supplemental Plans vest upon a Change in Control of the Corporation, as defined
in the Plans.
COMPENSATION OF DIRECTORS
In 1993, each member of the Board of Directors who was not an employee of
the Corporation or any of its subsidiaries was paid (i) $1,000 for attendance at
each Board meeting and (ii) $600 for attendance at each meeting of a committee
of the Board of which he was a member. In addition, each such director was paid
a quarterly fee of $5,000. Employee members of the Board of Directors are not
paid separately for their service on the Board or its committees.
Under the retirement policy for directors, any director retiring from the
Board after age 60 with at least five years' service on the Board will receive
$12,000 per year for life, payable in quarterly installments. Any director
retiring under other circumstances will receive $12,000 per year, payable in
quarterly installments, commencing no earlier than age 60, for a period not to
exceed his years of service on the Board. Such retirement payments to former
directors may be discontinued under certain circumstances.
In 1992, the Corporation's shareholders approved the Non-Employee
Directors' Stock Acquisition Plan (the Directors Stock Plan), which provides
that the Corporation shall award on each July 1, to each eligible director that
number of whole shares of Ethyl Common Stock when multiplied by the closing
price of Ethyl Common Stock on the immediately preceding business day, as
reported in THE WALL STREET JOURNAL, as shall as nearly as possible equal but
not exceed $2,000. The shares of Ethyl Common Stock awarded under the Directors'
Stock Plan are nonforfeitable and the recipient directors immediately and fully
vest in Ethyl Common Stock issued under the Plan. Subject only to such
limitations on transfer as may be specified by applicable securities laws,
directors may sell their shares under the Directors' Stock Plan at any time. The
Directors' Stock Plan provides that no awards may be made after July 1, 2001.
11
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The bonus, salary and stock option committee of the Corporation's Board of
Directors, which performs the function of a compensation committee, consists of
Messrs. Andrew, Carter and Rice. Mr. Andrew formerly served as Executive Vice
President and Chief Financial Officer of the Corporation. In 1993, he received
$100,000 in consulting fees for general advisory services to the Corporation,
including work on the spin-offs of First Colony Corporation and Albemarle
Corporation. Mr. Blanchard, who served on the Committee during 1993, formerly
served as Vice Chairman and Chief Financial Officer of the Corporation. In 1993,
he received $205,000 in consulting fees for financial and advisory services to
the Corporation, including $80,000 for certain services to the Corporation in
1992. Dr. Gautreaux, who served on the Committee during 1993, formerly served as
Senior Vice President of the Corporation. Mr. Carter is a Senior Counsel in
Hunton & Williams, which firm regularly acts as counsel to the Corporation.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Bonus, Salary and Stock Option Committee of the Board of Directors
(the Committee) is delegated the power to administer the compensation program of
the Corporation applicable to its executive officers. Accordingly, the Committee
submits this report on executive compensation to the shareholders:
OVERALL OBJECTIVES
The objectives of the Corporation's executive compensation program are:
to provide balanced, competitive total compensation that will enable the
Corporation to attract, motivate and retain highly qualified executives.
to provide incentives for enhancing the profitability of the Corporation
by rewarding executives for meeting individual and corporate goals.
to align the financial interests of the executives as closely as possible
to those of the shareholders by encouraging executive ownership of the
Corporation's common stock.
ELEMENTS OF THE PROGRAM
The Committee believes the interests of the shareholders will be best
served if the compensation program consists of cash compensation and equity
ownership. Thus the program includes three principal parts: base salary, annual
bonuses in cash or cash and stock and stock options with related SARs. The
Committee considers all parts of the program when setting compensation levels or
making awards.
The Corporation seeks to maintain executive compensation at competitive
levels on the basis of a review of marketplace competitiveness shown by
compensation surveys provided by compensation consultants. The various surveys
include companies that are larger and smaller than the Corporation. Some of the
surveys are limited to companies in the petroleum or chemical businesses,
including, but not limited to, companies shown within the Performance Graph. In
making compensation decisions, the Committee has not sought to compare the
corporate performance of companies identified in any survey with the
Corporation's performance. While the data varies among surveys, the Committee
believes that the combination of base salary and annual bonuses for 1993 for the
Chief Executive Officer falls between the medium and the high range, and the
same combination for all executive officers approximates the median range, for
the companies of comparable size included in the survey data.
12
<PAGE>
BASE SALARY
Annual increases in base salary are based on evaluations of past and
current individual and corporate performance, especially operating profits,
contribution to the Corporation's success, time in the position, the overall
level of pay adjustments in the markets the Corporation monitors and internal
equities among positions. The Committee considers each of the individual factors
but does not assign a specific value to each factor, and a subjective element is
acknowledged in evaluating each executive's contribution.
1993 was a transition year for the Corporation, including completion of
the spin-off of First Colony Corporation, a major restructuring of operations
and planning for the transfer of the Corporation's olefins and derivatives,
bromine chemicals and specialty chemicals businesses to the Corporation's wholly
owned subsidiary, Albemarle Corporation, to be followed by the spin-off of that
corporation to the Corporation's shareholders. As a part of this restructuring
in the latter part of 1993 the Corporation implemented an early retirement and
work-force reduction program for certain salaried employees. While many
successful actions were taken in 1993 that should result in improvements in
future performance, the Corporation's operating profits improved in 1993 but
lagged expectations. Consistent with the Company's reduction in force and 1993
operating performance, salary increases generally were less than in prior years.
ANNUAL BONUS
The Committee, in its discretion, may award bonuses annually to
management-level employees from a reserve based on certain defined profits of
the Corporation determined in accordance with a bonus formula approved by the
shareholders.
A bonus reserve is established through annual contributions. The maximum
contribution to the bonus reserve is 4% of the amount by which operating
profits of the Corporation and its subsidiaries, determined by the
independent auditors, exceed $15,000,000. The auditors certified that the
maximum contribution for 1993 under the formula was $12,248,960, but the
Committee, as has been the practice in prior years, did not appropriate
the entire amount. The amount actually appropriated to the bonus reserve,
$4,200,000, was less than the $6,000,000 appropriated in 1992, in
recognition that 1993 operating profit did not reach expected levels. Of
this amount, a total of $4,142,650 was awarded in 1994 as 1993 bonuses.
The purpose of the annual bonus is to motivate and reward performance
measured against individual, division, department and corporate objectives.
Annual bonus awards, intended to be competitive with industry practice,
are determined by the Committee in conjunction with senior management, and are
based on an evaluation of the performance, level of responsibility and
leadership of the individual executive in relation to overall corporate results.
The evaluation of overall performance of the Corporation in 1993 included such
factors as operating profit, performance in relation to competitive peer groups,
attainment of the key goals of completing the First Colony Corporation spin-off,
restructuring the Corporation's operations, and planning for the spin-off of
Albemarle Corporation. Bonus awards for 1993 generally were less than 1992,
reflecting the fact that 1993 operating results did not reach expected levels.
The Omnibus Budget Reconciliation Act of 1993 (OBRA '93) established
certain criteria for the tax deductibility of compensation in excess of $1
million paid to the Corporation's executive officers. To meet the criteria
applicable to performance based compensation (as defined in OBRA '93), the
Corporation's bonus plan would have to be amended to limit the Committee's
discretion to determine individuals' bonuses based on individual performance
factors and other factors as the Committee may determine, from time to time, to
be relevant. The Committee believes that the flexibility to adjust annual
bonuses upward, as well as downward, is an important feature of the plan and one
which serves the best interests of the Corporation by allowing the Committee to
13
<PAGE>
recognize and motivate individual executive officers as circumstances warrant.
Further, for 1994 the amount of compensation subject to loss of tax
deductibility is extremely small. Consequently the Committee does not propose at
the present time to amend the plan to comply with the OBRA '93 requirements.
Amounts paid under the plan to the executive officers will count toward the $1
million cap that is provided in Section 162(m) of the Internal Revenue Code, as
amended by OBRA '93, and, those portions of the officers' compensation that are
not performance based (as defined in OBRA '93) and that exceed the cap, will not
be tax deductible by the Corporation.
INCENTIVE STOCK OPTION PLAN
Under the Incentive Stock Option Plan approved by the shareholders, the
Committee, in its discretion, may grant options to purchase shares of Ethyl
Common Stock (with related SARs) to any executive of the Corporation or any
subsidiary who has contributed or can be expected to contribute to its profits
or growth. The Committee determines the amount of the grant, the term of the
options and the requisite conditions for exercise. The option price must be not
less than the fair market value of the stock on the date of grant, so the stock
must appreciate before the executive receives any benefit from the grant.
Options and SARs are generally granted with terms of 10 years. No Options or
SARs were granted during 1993 in anticipation that significant awards would be
made in 1994 at approximately the time of the spin-off of Albemarle Corporation.
CEO COMPENSATION
Under the Corporation's executive compensation program, the compensation
mix for senior executives is somewhat more heavily weighted toward base salary
than incentives, consistent with industry practice and the Corporation's
philosophy. On this basis, during 1993, Mr. Bruce C. Gottwald, President of
Ethyl Corporation, received a base salary of $770,000. This salary was
established by the Committee in November 1992 based on corporate and individual
performance factors, without weighing them, including the expanded scope of his
responsibilities upon assuming the position of Chief Executive Officer and the
Corporation's operating profits and the increase in value for holders of the
Corporation's Common Stock.
Mr. Gottwald's base salary represents 74.4% of his total 1993 cash
compensation, the balance, $265,000, being the 1993 award of cash under the
Corporation's bonus plan. The bonus award for 1993 represents the Committee's
evaluation of the executive's contribution to the Corporation's overall
performance during that time, particularly, his leadership of the major
restructuring of the Corporation's activities including the implementation of
the early-retirement and work force reduction program and the planning for the
spin-off of Albemarle Corporation. As with most of the other executive officers
of the Corporation, the 1993 bonus was less than the 1992 bonus, in recognition
that 1993 operating results, while better than 1992 results, were below
expectations.
THE BONUS, SALARY AND STOCK OPTION
COMMITTEE
Emmett J. Rice, Chairman
Lloyd B. Andrew
Joseph C. Carter, Jr.
14
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
VS. S&P 500 AND CHEMICAL COMPOSITE
(A performance graph appears here. The following chart describes the information
included in the graph).
December 1988 through December 1993
Date Ethyl S&P 500 Chemical Composite
December 1988 $100.00 $100.00 $100.00
December 1989 $143.80 $131.59 $128.29
December 1990 $125.80 $127.49 $114.58
December 1991 $153.25 $166.17 $152.20
December 1992 $160.10 $178.81 $169.42
December 1993 $153.44 $196.75 $189.61
- ----------
*Assumes $100 invested on last day of December 1988. Dividends are reinvested
quarterly.
ASSUMES $100 INVESTED ON 12/31/88 IN ETHYL COMMON STOCK, S&P 500 AND CHEMICAL
COMPOSITE INDICES AND REINVESTMENT OF DIVIDENDS.
The total return information for the Chemical Composite has been weighted
by market capitalization and includes the following companies, which constitute
the companies included in all the S&P chemical industry groups (basic chemicals,
diversified chemicals and specialty chemicals): Air Products and Chemicals,
Inc., Avery Dennison Corporation, The Dow Chemical Company, E.I. du Pont de
Nemours & Company, Engelhard Corp., Ethyl Corporation, FMC Corporation, First
Mississippi Corp., The B. F. Goodrich Company, W. R. Grace & Co., Great Lakes
Chemical Corp., Hercules Incorporated, Monsanto Company, Morton International,
Inc., NL Industries, Inc., Nalco Chemical Co., PPG Industries, Inc., Praxair,
Inc., Rohm and Haas Company and Union Carbide Corporation.1
1 This table no longer reflects return information for Quantum Chemical
Corporation, which is no longer publicly traded, and IMCERA Group Inc., which
has been transferred to the S&P Diversified Health Care Index.
15
<PAGE>
AMENDMENT OF STOCK OPTION PLAN
The Board of Directors of the Corporation has unanimously adopted, and
recommends that the shareholders approve, an amendment to the Company's
Incentive Stock Option Plan (the Option Plan), to increase the number of shares
issuable under the Option Plan by 5,900,000 to 11,900,000 and to establish an
annual limit on the number of shares for which options may be granted to an
individual. The Option Plan is intended to further the long-term stability and
financial success of the Corporation by recruiting, attracting and retaining key
employees through the use of stock incentives.
INCREASE IN NUMBER OF SHARES
A maximum of 6,000,000 shares of Ethyl Common Stock currently may be
issued pursuant to options granted under the Option Plan; of that number, only
78,750 shares remain available for issuance pursuant to the Option Plan. The
Corporation believes that option grants under the Option Plan will continue to
be an important ingredient of its successful recruitment and retention of
management personnel.
The Option Plan provides that a committee of three or more members of the
Board (who are ineligible to participate in the Option Plan) appointed by the
Board (the Committee) may from time to time grant options (options) to purchase
shares of Ethyl Common Stock to any employee of the Corporation or any
subsidiary (as defined) who, in the Committee's judgment, has contributed or can
be expected to contribute to its profits or growth. The Corporation presently
has approximately 1,700 employees. The present Committee consists of Messrs.
Andrew, Carter and Rice.
Two types of options -- incentive stock options (ISOs) and nonqualified
stock options -- may be granted under the Option Plan. The two types of options
differ primarily in the tax consequences relating to exercise and disposition of
shares acquired pursuant to the Option Plan. See Federal Income Tax Consequences
below. An option entitles the optionee to purchase shares of the Corporation's
Common Stock from the Corporation at the option price. The option price is fixed
by the Committee, but in no case can it be less than the fair market value of
the shares at the time the option is granted. The option price may be paid by
the optionee in cash or, with the consent of the Committee, with shares of Ethyl
Common Stock or a combination of stock and cash.
The closing price of a share of Ethyl Common Stock on the New York Stock
Exchange on March 16, 1994, was $12.50.
The Committee may also grant to eligible employees SARs in relation to
grants of options. To exercise an SAR, the optionee must surrender unexercised
that portion of the option to which the SAR relates. Options surrendered upon
exercise of the SARs are not again available for grant. An SAR entitles the
optionee to receive the lesser of (i) the excess of fair market value of a share
of Ethyl Common Stock on the date of exercise over the option price of the
related option, or (ii) the fair market value of a share of Ethyl Common Stock
on the date of grant. An SAR may be exercised only to the extent that the
related option is exercisable. Upon his exercise of an SAR, the optionee may
elect, subject to the Committee's discretion, to receive shares of Ethyl Common
Stock or a combination of cash and such shares, but no more than 50% of the
total payment may be in cash.
The Committee is responsible for selecting optionees and determining the
amounts, times and forms of option grants. As amended, the Option Plan provides
that after April 28, 1994, no individual may be granted options and SARs in any
calendar year for more than 200,000 shares of Ethyl Common Stock. For purposes
of this limitation, an option and related SAR are treated as a single award. All
grants must be exercised according to such requirements as the Committee may
establish consistent with the Option Plan. Any grants under the Option Plan must
be made on or before February 26, 2002. All options and SARs expire no later
than ten years from the
16
<PAGE>
date of grant. No cash consideration is received by the Corporation for grants
of options or SARs. Options and SARs are not transferable except by will or the
laws of descent and distribution. An ISO may not be first exercisable in any
calendar year for shares having an aggregate market value (determined as of the
date of grant), in excess of $100,000. The Option Plan contains certain
antidilution provisions relating to stock dividends, stock splits and the like.
In connection with the spin-off of its wholly owned subsidiary, Albemarle
Corporation, the Corporation on March 1, 1994, granted options under the Option
Plan to all of its executive officers as of March 1, 1994, except Bruce C.
Gottwald and F. D. Gottwald, Jr., and to certain other key employees. The
following table reflects option awards to the persons named in the table on page
9.
<TABLE>
<CAPTION>
NAME AND CURRENT POSITION
WITH THE CORPORATION NUMBER OF OPTIONS
<S> <C>
Bruce C. Gottwald
Chairman of the Board and Chief Executive Officer 0
Floyd D. Gottwald, Jr.
Vice Chairman of the Board 0
Charles B. Walker
Vice Chairman of the Board and Chief Financial Officer 100,000
E. Gary Cook 0
E. Whitehead Elmore
Special Counsel to the Executive Committee and Corporate Secretary 30,000
Executive Group 1,480,000
Non-Executive Officer Employee Group 1,542,000
</TABLE>
The options reported in the foregoing table have an exercise price of
$12.50 per share, include tandem SARs and will vest over the term of the options
based on the achievement of either certain earnings performance or stock price
goals, but in no event later than the earlier to occur of (i) 30 days before the
expiration of the options or (ii) a Change in Control of the Corporation, as
defined in the related option agreements.
Mr. Walker and Mr. Elmore, who also are serving as executive officers of
Albemarle Corporation, were also granted options by that corporation on March 1,
1994.
The Board of Directors, without further action by the shareholders, may
amend or terminate the Option Plan, provided that no such amendment by the Board
will be effective until approved by shareholders if the amendment (a) increases
the maximum number of shares that may be issued under the Option Plan, (b)
changes the requirement that the option price per share be not less than the
fair market value of a share of Ethyl Common Stock on the date of grant, or (c)
changes the eligibility requirements for optionees.
FEDERAL INCOME TAX CONSEQUENCES
The Corporation has been advised by counsel that, for federal income tax
purposes, no taxable income will be realized by any optionee when an option or
SAR is granted under the Option Plan. If an option is exercised, the federal
income tax consequences will depend upon whether the option is an ISO or a
nonqualified option.
No income will be recognized by an optionee who exercises an ISO unless
and until he disposes of shares received upon exercise of the ISO (although the
exercise of an ISO may increase or result in alternative minimum
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tax liability). If the optionee does not dispose of the shares within two years
from the date the ISO was granted and one year after the shares were transferred
to him (the ISO holding period), he will be taxed when he does dispose of the
shares at capital gain rates on the amounts realized on a sale or exchange less
the option price. If he disposes of the shares before the ISO holding period
expires, he generally will recognize as ordinary income the excess of the fair
market value of the shares on the date of exercise over the option price. Any
additional gain will be taxed as long-or short-term capital gain, depending on
the length of the period the shares were held. If an optionee sells or exchanges
the shares for less than the fair market value on the date of exercise, the
amount recognized as ordinary income will be limited to the amount realized on
such sale or exchange less the option price, provided that the transaction is
one in which a loss could be recognized if a loss had been incurred.
The Corporation will not be entitled to any deduction with respect to the
grant or exercise of an ISO. The employer corporation (the Corporation or a
subsidiary) may claim a deduction if the optionee disposes of his shares before
the ISO holding period expires. The amount of deduction is equal to the amount
of ordinary income recognizable by the optionee.
Upon the exercise of a nonqualified stock option, an optionee generally
will recognize as ordinary income the excess of the fair market value of the
shares on the date of the exercise over the option price. Upon the exercise of
any SAR, an optionee generally recognizes as ordinary income the amount of any
cash and the fair market value of the shares he receives. The amount
recognizable as income by an optionee on account of the acquisition of shares
upon the exercise of a nonqualified stock option or an SAR will be included in
his tax basis for computing gain or loss on a sale or exchange of the shares.
Any such gain or loss will be long-or short-term capital gain or loss, depending
on the length of the period the shares are held.
Upon exercise of a nonqualified stock option or an SAR, the employer
corporation (the Corporation or a subsidiary) generally will be entitled to a
deduction in the year the optionee recognizes ordinary income in an amount equal
to the income recognizable by the optionee.
VOTE REQUIRED
The approval of the amendments to the Option Plan requires the affirmative
vote of the holders of a majority of the shares of Common Stock present or
represented by properly executed and delivered proxies at the meeting.
Abstentions and Broker Shares voted as to any matter at the meeting will be
included in determining the number of votes present or represented at the
meeting. Broker Shares that are not voted on any matter at the meeting will not
be included in determining the number of shares present or represented at the
meeting.
DESIGNATION OF AUDITORS
The Board of Directors has designated Coopers & Lybrand, certified public
accountants, as the Corporation's independent auditors for the year 1994,
subject to shareholder approval. This firm has audited the Corporation's
financial statements since 1962 and those of the former Ethyl Corporation
(Delaware) from 1947 to 1962. A representative of Coopers & Lybrand is expected
to be present at the annual meeting with an opportunity to make a statement and
to be available to respond to appropriate questions.
Coopers & Lybrand's principal function is to audit the consolidated
financial statements of the Corporation and its subsidiaries and, in connection
with that audit, to review certain related filings with the Securities and
Exchange Commission and to conduct limited reviews of the financial statements
included in each of the Corporation's quarterly reports.
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FINANCIAL STATEMENTS
A copy of the Corporation's Annual Report on Form 10-K for the year 1993,
as required to be filed with the Securities and Exchange Commission, will be
provided on written request without charge to any shareholder whose proxy is
being solicited by the Board of Directors. The written request should be
directed to:
E. Whitehead Elmore, Esq.
Secretary
Ethyl Corporation
330 South Fourth Street
P.O. Box 2189
Richmond, Virginia 23217
PROPOSALS FOR 1995 ANNUAL MEETING
Under the regulations of the Securities and Exchange Commission, any
shareholder desiring to make a proposal to be acted upon at the 1995 annual
meeting of shareholders must present such proposal to the Corporation at its
principal office in Richmond, Virginia, not later than November 29, 1994, in
order for the proposal to be considered for inclusion in the Corporation's proxy
statement. The Corporation anticipates holding the 1995 annual meeting on April
27, 1995.
The Corporation's bylaws provide that, in addition to any other applicable
requirements, for business to be properly brought before the annual meeting by a
shareholder, the shareholder must give timely notice in writing to the Secretary
of the Corporation not later than 60 days prior to the meeting. As to each
matter, the notice should contain (i) a brief description of the matter and the
reasons for addressing it at the annual meeting, (ii) the name, record address
of, and number of shares beneficially owned by the shareholder proposing such
business and (iii) any material interest of the shareholder in such business.
OTHER MATTERS
The Board of Directors is not aware of any matters to be presented for
action at the meeting other than as set forth herein. However, if any other
matters properly come before the meeting, or any adjournment thereof, the person
or persons voting the proxies will vote them in accordance with their best
judgment.
By Order of the Board of Directors
E. WHITEHEAD ELMORE, SECRETARY
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NOTICE
and
PROXY STATEMENT
for
ANNUAL MEETING
of
SHAREHOLDERS
April 28, 1994
ETHYL CORPORATION
RICHMOND, VIRGINIA
Proxy for Annual Meeting of Shareholders
to be held April 28, 1994
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Floyd D. Gottwald, Jr., Sidney Buford Scott
and Joseph C. Carter, Jr., or any of them, with full power of substitution in
each, proxies (and if the undersigned is a proxy, substitute proxies) to vote
all shares of the undersigned in Ethyl Corporation, at the annual meeting of
shareholders to be held April 28, 1994, and at any and all adjournments
thereof.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE
ETHYL CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY
1. Elections of Directors-
Lloyd B. Andrew, William W. Berry, Allen C. Goolsby, Bruce C. Gottwald,
Bruce C. Gottwald, Jr., Floyd D. Gottwald, Thomas E. Gottwald, William M.
Gottwald, MD, Gilbert M. Grosvenor, Andre B. Lacy, Emmett J. Rice, Sidney
Buford Scott and Charles B. Walker
( ) For ( ) Withhold ( ) For All Except Nominee(s)
Written Below
2. The proposal to approve an increase in the number of shares of the
Corporation's Common Stock issuable under its stock option plan and to
establish an annual limit on the number of shares for which options may be
granted to an individual.
( ) For ( ) Against ( ) Abstain
3. The Proposal to approve the appointment of Cooper's & Lybrand as the
auditors for the Corporation for 1994.
( ) For ( ) Against ( ) Abstain
4. In their discretion, the Proxies are authorized to vote upon such other
business and matters incident to the conduct of the meeting as may
properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1, 2 AND 3.
Signature______________________________________Dated__________________,1994
NOTE: Please sign name exactly as appears on the stock certificate. Only one
of several owners need sign. Fiduciaries should give title.
