<PAGE>
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:
[X] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
FMC CORPORATION
(Name of Registrant as Specified In Its Charter)
FMC 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(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $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 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] 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:
Notes:
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Preliminary Copy
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Chicago, Illinois
March , 1995
To the Stockholders:
The Annual Meeting of the Stockholders of FMC Corporation (the "Company") will
be held at the Indiana Room on Lower Level One, Amoco Building, 200 East
Randolph Drive, Chicago, Illinois, on Friday, April 21, 1995, at 2:00 p.m. for
the following purposes:
1. To elect four directors of the Company for a term expiring at the 1998
Annual Meeting of Stockholders;
2. To ratify the appointment of KPMG Peat Marwick, LLP as the Company's
independent auditors for fiscal year 1995;
3. To approve the FMC 1995 Management Incentive Plan;
4. To approve the FMC 1995 Stock Option Plan; and
5. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
Only stockholders of record at the close of business on March 2, 1995, are
entitled to notice of, and to vote at, the meeting and at any adjournment or
postponement thereof. A complete list of such stockholders will be open for
examination by any stockholder for any purpose germane to the meeting at the
principal executive office of the Company located at 200 East Randolph Drive,
Chicago, Illinois, for a period of 10 days prior to the meeting.
IF YOU DO NOT EXPECT TO ATTEND IN PERSON, PLEASE SIGN AND RETURN THE ENCLOSED
PROXY.
By order of the Board of Directors
Robert L. Day
Secretary
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<C> <S> <C>
Solicitation.............................................................. 1
I. Election of Directors............................................. 1
Nominees for Director............................................. 2
Directors Continuing in Office.................................... 4
Information Concerning the Board of Directors..................... 8
Security Ownership of the Company................................. 11
II. Ratification of Selection of Independent Auditors................. 13
III. Approval of FMC Incentive Compensation Plans...................... 13
A. Approval of FMC 1995 Management Incentive Plan................. 15
B. Approval of FMC 1995 Stock Option Plan......................... 16
IV. Executive Compensation............................................ 17
Summary Compensation Table........................................ 17
Option Grants..................................................... 18
Aggregated Option Exercises in 1994 and Year-End Option Values.... 19
Retirement Plans.................................................. 19
Termination of Employment and Change of Control Arrangements...... 20
Report of the Compensation Committee on Executive Compensation.... 21
Stockholder Return Performance Presentation....................... 24
V. Vote Required..................................................... 25
VI. Compliance with Section 16(a) of the Securities Exchange Act...... 26
VII. Proposals for 1996 Annual Meeting................................. 26
VIII. Other Matters..................................................... 26
Exhibit A......................................................... A-1
Exhibit B......................................................... B-1
</TABLE>
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PROXY STATEMENT
FMC Corporation
200 East Randolph Drive
Chicago, Illinois 60601
March , 1995
SOLICITATION
This Proxy Statement is being furnished in connection with the solicitation of
proxies by the Board of Directors of FMC Corporation, a Delaware corporation
("FMC" or the "Company") from holders of the Company's outstanding shares of
common stock, par value of $.10 per share (the "Common Stock") for use at the
Annual Meeting of Stockholders of the Company (the "Annual Meeting") to be held
at the time and place and for the purposes set forth in the accompanying
Notice. Proxies furnished may be revoked by a stockholder at any time prior to
their use, and the shares represented by the proxies received will be voted as
directed. If no direction is given, the shares will be voted as recommended by
the Board of Directors.
The Company will pay all expenses connected with the solicitation of proxies.
In addition to solicitation by mail, officers, directors and regular employees
of the Company may solicit proxies by telephone, telegraph or personal call
without special compensation therefor. The Company expects to reimburse banks,
brokers and other persons for their reasonable out-of-pocket expenses in
handling proxy material for beneficial owners.
Only holders of record of Common Stock at the close of business on March 2,
1995, are entitled to vote at the annual meeting. On that date there were
issued and outstanding shares of Common Stock. Each of such shares
is entitled to one vote.
The annual report of the Company for the year 1994, including financial
statements, and this proxy statement and accompanying form of proxy were mailed
on March , 1995, to all stockholders of record as of March 2, 1995.
I. ELECTION OF DIRECTORS
The Company's Certificate of Incorporation provides for three classes of
directors of as nearly equal size as possible. The term of each class of
directors is three years, and the term of one class expires each year in
rotation. The term of the directors comprising Class III expires at the 1995
annual meeting of the Company's stockholders.
At the present time it is intended that shares represented by the proxies
received will be voted for the election of Messrs. Bridgewater, Davies, Reilly
and Thompson, the persons nominated by the Board, for a three-year term
expiring at the 1998 Annual Meeting of Stockholders. The nominees currently are
all members of Class III.
1
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The Board of Directors expects that all of the nominees will be able and
willing to serve as directors. If any nominee should become unavailable, for
reasons not now known, the proxies may be voted for another person nominated by
the present Board of Directors to fill the vacancy, or the size of the Board
may be reduced.
RECOMMENDATION OF THE BOARD
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES LISTED BELOW AS
CLASS III DIRECTORS OF THE COMPANY.
NOMINEES FOR DIRECTOR
CLASS III--FOR A TERM EXPIRING IN 1998
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Name: B. A. Bridgewater, Jr.
Principal Occupation: Chairman of the Board, President and
Chief Executive Officer, Brown Group, Inc.
Age: 60
Director Since: 1979
Mr. Bridgewater became Chairman and Chief Executive Officer of Brown Group,
Inc., in March 1985. Brown Group is a diversified manufacturer and retailer of
footwear. Mr. Bridgewater became the company's Chief Executive Officer in June
1982, served as President from 1979 to 1987 and in 1990 resumed the presidency
of the company. From 1975 to 1979, he was Executive Vice President of Baxter
Travenol Laboratories, and from 1964 to 1975 he was a Director of McKinsey &
Company, Inc. He served as Associate Director of National Security and
International Affairs in the Office of Management and Budget in the Executive
Office of the President of the United States. He is a director of McDonnell
Douglas Corporation, ENSERCH Corporation, Enserch Exploration, Inc. and
Boatmen's Bancshares, Inc.
2
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LOGO
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Name: Paul L. Davies, Jr.
Principal Occupation: President, Lakeside Corporation, a real
estate investment company
Age: 64
Director Since: 1965
Mr. Davies became the President of Lakeside Corporation in 1989. Previously, he
had been a Partner in the San Francisco law firm of Pillsbury, Madison & Sutro
from 1963 to 1989. He was an Associate of the law firm from 1957 to 1963. He is
a Director of FMC Gold Company and Sumitomo Bank of California, President of
The Herbert Hoover Foundation, Inc., Member of the Board of Overseers of the
Hoover Institution and an Honorary Trustee of the California Academy of
Sciences.
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Name: William F. Reilly
Principal Occupation: Chairman and Chief Executive Officer of
K-III Communications Corp., a private investment and business
development firm
Age: 56
Director Since: 1992
Mr. Reilly is the founder of K-III Communications Corp. He has served as
Chairman and Chief Executive Officer of the firm since February 1990. From 1980
to 1990 he was with Macmillan, Inc., where he served as President and Chief
Operating Officer since 1981. Prior to that, he was with W.R. Grace since 1964,
serving as Assistant to the Chairman from 1969 to 1971 and serving successively
from 1971 to 1980 as President and Chief Executive Officer of its Textile,
Sporting Goods and Home Center Divisions. Mr. Reilly serves on the Liberal Arts
Board of Notre Dame University and the Board of Directors of City Meals on
Wheels.
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3
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Name: James R. Thompson
Principal Occupation: Chairman, Chairman of the Executive
Committee and Partner, Law Firm of Winston & Strawn, Chicago,
Illinois
Age: 58
Director Since: 1991
Governor Thompson was named Chairman of the Chicago law firm of Winston &
Strawn in January 1993. He joined the firm in January 1991 as Chairman of the
Executive Committee after serving four terms as Governor of the State of
Illinois from 1977 until January 14, 1991. Prior to his term as Governor, he
served as U.S. Attorney for the Northern District of Illinois from 1971-1975.
Governor Thompson served as the Chief of the Department of Law Enforcement and
Public Protection in the Office of the Attorney General of Illinois, as an
Associate Professor at Northwestern University School of Law, and as an
Assistant State's Attorney of Cook County. He is a former Chairman of the
President's Intelligence Oversight Board and a member of the Board of Directors
of Chicago & Northwestern Holding Corporation, the Chicago Board of Trade,
Prime Retail, Inc., Pechiney, Int., Jefferson Smurfit Corporation, American
Publishing Co. and Wackenhut Corrections Corp. He serves on the Boards of the
Chicago Historical Society, the Museum of Contemporary Art, the Lyric Opera,
the Illinois Math & Science Academy Foundation and the Illinois Academy of Fine
Arts.
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DIRECTORS CONTINUING IN OFFICE
CLASS I--TERM EXPIRING IN 1996
- --------------------------------------------------------------------------------
Name: William W. Boeschenstein
Principal Occupation: Retired Chairman of the Board and Chief
Executive Officer, Owens-Corning Fiberglas Corporation
Age: 69
Director Since: 1975
Mr. Boeschenstein retired as Chairman and Chief Executive Officer of Owens-
Corning Fiberglas Corporation in 1990. He was named Chairman of the company in
November 1981. He became Chief Executive Officer in January 1973 and was named
President and Chief Operating Officer in August 1971. Mr. Boeschenstein joined
Owens-Corning Fiberglas in 1950 and held a series of sales, marketing and
management positions. He became a Vice President of the company in 1959. Mr.
Boeschenstein is a Director of Owens-Corning Fiberglas and Prudential Insurance
Company of America.
4
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LOGO
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Name: Robert N. Burt
Principal Occupation: Chairman of the Board and Chief Executive
Officer, FMC Corporation
Age: 57
Director Since: 1989
Mr. Burt is Chairman of the Board and Chief Executive Officer of FMC
Corporation. He joined FMC in 1973 and held a series of management positions
over the next few years. He was appointed General Manager of the Company's
Agricultural Chemical Group in 1977 and became General Manager of the Company's
Defense Systems Group in 1983. Mr. Burt was elected a Vice President of the
Company in 1978 and Executive Vice President in September 1988. He became
President of the corporation in March 1990, and Chairman and Chief Executive
Officer in November 1991 and resigned as President in 1993 upon the election of
Mr. Brady to that office. Prior to joining FMC, Mr. Burt held management
positions with Chemetron Corporation and Mobil Oil Corporation. He is a
Director of Phelps-Dodge Corporation and a member of the Advisory Board of
United Defense, L. P., and he serves on the Board of Trustees of the Orchestral
Association of Chicago and the Chicago Historical Society, and on the Boards of
Directors of Chemical Manufacturers Association, the Rehabilitation Institute
of Chicago and the World Resource Institute.
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Name: Jean A. Francois-Poncet
Principal Occupation: Member of the French Senate
Age: 66
Director Since: 1982
Mr. Francois-Poncet was elected to the French Senate in September 1983. From
1978 to 1981, he served as the Minister of Foreign Affairs of France, and from
1976 to 1978 he was Secretary General to the French Presidency under Valery
Giscard d'Estaing. Mr. Francois-Poncet entered the private sector from 1970 to
1975 as Chairman and Chief Executive Officer of Carnaud and Company, a major
French producer of tinplate and containers. He began his public sector career
in 1955, when he joined the French Ministry of Foreign Affairs. His assignments
included European and African affairs and diplomatic appointments in the French
embassies in Morocco and Iran. Mr. Francois-Poncet serves as a member of the
Supervisory Board of Daimler-Benz, A.G.
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5
<PAGE>
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Name: General Edward C. Meyer (Retired)
Principal Occupation: Chairman, GRC International, Inc.;
Managing Partner, Cilluffo Associates, L.P., a private
investment group
Age: 66
Director Since: 1983
General Meyer retired as Chief of Staff of the United States Army in 1983 and
today is Chairman of GRC International, Inc. and a managing partner of Cilluffo
Associates. In other major military assignments, he served as Senior Military
Representative on the Military Staff of the United Nations in New York and as
Deputy Chief of Staff of Operations and Plans for the U.S. Army in Washington,
DC. He is a Director of ITT Corporation, Brown Group, Inc., Alcatel, N.V., GRC
International, and FMC-Nurol Savunma Sanayii A.S., an FMC-Turkish joint venture
and a member of the Advisory Board of United Defense, L.P. He is a Trustee of
The MITRE Corporation and the George Marshall Foundation, and a member of the
Board of Overseers of the Hoover Institution and the Board of Advisors of the
Center for Strategic and International Studies. He is President of the Army
Emergency Relief Association.
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CLASS II--TERM EXPIRING IN 1997
- --------------------------------------------------------------------------------
Name: Larry D. Brady
Principal Occupation: President, FMC Corporation
Age: 52
Director Since: 1989
Mr. Brady was elected President of FMC Corporation in October 1993 and served
as Executive Vice President since September 1989. He also serves as Chairman
and Chief Executive Officer of FMC's 80-percent-owned FMC Gold Company, a
position he assumed in November 1991. He joined FMC in 1978 as Planning
Director of Special Products Group and held several management positions over
the next few years. He was elected a Vice President of the corporation in 1984,
and from 1983 to 1988 he served as General Manager of FMC's Agricultural
Chemical Group. Prior to joining FMC, Mr. Brady held senior management
positions at TRW Inc. and Beatrice Foods Company. He is a member of the
Advisory Board of United Defense, L. P. and he serves on the Executive
Committee of the National Association of Manufacturers, the Board of Governors
of the Illinois Council on Economic Education and the Food Industries
International Trade council.
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6
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LOGO
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Name: Patricia A. Buffler
Principal Occupation: Dean, Professor of Epidemiology, School
of Public Health, University of California, Berkeley
Age: 56
Director Since: 1994
Dr. Buffler has served in her current position since 1991. From 1979 until 1991
she was associated with the University of Texas Health Sciences Center at
Houston, School of Public Health, where she held numerous positions, including
Associate Dean for Research (1980-84), Director of the Southwest Center for
Occupational and Environmental Health (1988) and as the Ashbel Smith Professor
in Public Health (1989). She received her BSN from Catholic University of
America in 1960, and a master's degree in public health and epidemiology and a
PhD in epidemiology from the University of California, Berkeley in 1965 and
1973, respectively. She currently serves as an advisor to the World Health
Organization, the U.S. Department of Energy, the U.S. Environmental Protection
Agency and the National Research Council. She was elected as a Fellow of the
American Association for the Advancement of Science in 1993 and serves as an
officer for the Medical Sciences section. She has served as President for the
Society for Epidemiologic Research (1986), the American College of Epidemiology
(1992), and the International Society for Environmental Epidemiology (1992-
1993). She is a Board member and Chair of the National Urban Air Toxics
Research Center, on the Board of the Societal Institute of the Mathematical
Sciences and President of the Board of Directors of the Western Consortium for
Public Health. In 1994, she was elected to the Institute of Medicine, National
Academy of Sciences.
- --------------------------------------------------------------------------------
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Name: Albert J. Costello
Principal Occupation: Retired Chairman and Chief Executive
Officer, American Cyanamid Company
Age: 59
Director Since: 1995
Mr. Costello was chairman of the board and chief executive officer of American
Cyanamid Company from April 1993 until his recent retirement. He served as
president of the company from 1991, when he also became a member of its Board
of Directors. He joined Cyanamid as a chemist in 1957, and held a number of
marketing and management posts. In 1983, he was appointed executive vice
president and a member of the Executive Committee. Mr. Costello is a member of
the boards of trustees of Fordham University and St. Joseph's Hospital and
Medical Center, and a member of the British-North American Committee of the
National Planning Association. He served as chairman of the board of the
National Agricultural Chemicals Association from 1984 to 1985. He also served
on the boards of directors of the Chemical Manufacturers Association, the
Pharmaceutical Manufacturers Association, The Business Roundtable, and the
American Enterprise Institute for Public Policy Research.
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7
<PAGE>
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Name: Robert H. Malott
Principal Occupation: Chairman of the Executive Committee and
Former Chairman of the Board and Chief Executive Officer, FMC
Corporation
Age: 68
Director Since: 1970
Mr. Malott joined FMC Corporation in 1952 and retired in October 1991 after
serving as Chairman and Chief Executive Officer since 1973. He is also on the
Board of Amoco Corporation, United Technologies Corporation, RBX Corporation
and Swiss Bank Corporation (Council of International Advisors). He is on the
Board of The National Museum of Natural History (Chairman), the Aspen
Institute, the Lyric Opera of Chicago, the National Park Foundation, American
Enterprise Institute, the Hoover Institution, The Business Council, the
University of Chicago, Argonne National Laboratories and the Illinois Business
Roundtable (Policy Committee).
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Name: Clayton Yeutter
Principal Occupation: Of Counsel, Law Firm of Hogan & Hartson
Age: 64
Director Since: 1993
Mr. Yeutter originally joined FMC's Board in 1991 and resigned in 1992 to
accept a position as Counselor to the President of the United States for
Domestic Policy. He was appointed chairman of the Republican National Committee
in 1991 after serving as Secretary of Agriculture from 1989. From 1985 to 1989,
Mr. Yeutter served as U.S. Trade Representative. Prior to that, he was
President and Chief Executive Officer of the Chicago Mercantile Exchange since
1978. He was a senior partner of the law firm of Nelson, Harding, Yeutter &
Leonard in Lincoln, Nebraska during 1977-78. He served as Deputy Special Trade
Representative from 1975 to 1977. Mr. Yeutter earlier held several additional
positions with the Department of Agriculture and also spent several years as a
faculty member of the Department of Agricultural Economics at the University of
Nebraska. He is a director of Texas Instruments, Inc., Conagra Inc.,
Caterpillar Inc., BAT Industries, Vigoro Corp, Lindsay Mfg. Co. and the
Oppenheimer Funds group of investment companies.
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INFORMATION CONCERNING THE BOARD OF DIRECTORS
MEETINGS. During 1994, the Company's Board of Directors held seven regular
meetings, including an organization meeting held by written consent of all of
the Directors as permitted by Delaware law. During 1994, all incumbent
directors attended at least 75 percent of the total number of meetings of the
Board and all committees on which they served, except for Mr. Francois-Poncet.
8
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COMMITTEES. The Board has five standing committees -- an Audit Committee, a
Compensation and Organization Committee, an Executive Committee, a Nominating
and Board Procedures Committee, and a Public Policy Committee.
The Audit Committee reviews the effectiveness of the independent public
accountants and the internal auditors, including the scope of their audit
activities, and ensures that no restrictions are placed on the scope or
implementation of their audits; reviews the fees of the independent public
accountants and any significant comments or problems identified as a result of
their audits; reviews the nature of any changes in accounting policies or
principles that have a material import; inquires into the effectiveness and
adequacy of the Company's financial and accounting organization and internal
controls; reviews officers' expense accounts; evaluates procedures for securing
and confirming compliance with the Company's Business Conduct Guidelines;
reviews potentially significant litigation; and reviews with management and the
independent public accountants the financial statements and other material
included in any registration statement or annual report on Form 10-K filed with
the Securities and Exchange Commission. The Audit Committee, composed of
Messrs. Boeschenstein (Chairman), Bridgewater, Reilly and Yeutter, met twice
during 1994.
The objectives of the Compensation and Organization Committee, which comprises
only outside directors, are to review and approve compensation policies and
practices for top executives, establish the total compensation for the Chief
Executive Officer, review major changes in the Company's employee benefit
plans, monitor and review significant organization changes and management
succession planning, and recommend to the Board of Directors candidates for
officers of the Company. Messrs. Davies (Chairman), Boeschenstein, Bridgewater,
and Meyer made up the Compensation and Organization Committee, which met three
times in 1994.
The function of the Executive Committee is to act in place of the Board when
the full Board is not in session. The members of that committee, which did not
meet in 1994, are Messrs. Malott (Chairman), Bridgewater, Burt, Davies and
Meyer.
The Nominating and Board Procedures Committee is responsible for reviewing and
recommending candidates for director, recommending Board meeting format,
reviewing and approving director compensation policies and establishing
director retirement policies. If a stockholder wishes to recommend a nominee
for director, the recommendation should be sent to the Corporate Secretary, at
the address appearing on the first page of this proxy statement, not less than
60 nor more than 90 days prior to an annual meeting of stockholders. All
serious recommendations will be considered by the Committee. Messrs.
Bridgewater (Chairman), Boeschenstein, Burt, Malott, Reilly and Thompson make
up the Nominating and Board Procedures Committee, which met four times during
1994.
The duties of the Public Policy Committee are to review the Company's
government and legislative programs and relations, determine the
appropriateness of the Company's programs in such areas as affirmative action,
environmental and product quality, and employee safety and health, assess the
Company's efforts to improve local employee community involvement and review
the activities of the Company's charitable foundation. The Public Policy
Committee, whose members were Messrs. Meyer (Chairman), Brady, Francois-Poncet,
Thompson and Yeutter and Mrs. Buffler, met twice during 1994.
9
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The ad hoc Special Litigation Committee, originally formed by the Board in 1986
for oversight of the Company's litigation for insider trading and other misuse
of confidential information in connection with the recapitalization of the
Company in 1986, was discontinued in 1994. The Committee, which met once during
1994, was composed of Messrs. Thompson (Chairman), Davies and Malott.
Remuneration. Since 1987, directors who were not officers of the Company
received $25,000 per year, $800 for each Board meeting attended, $800 for each
Committee meeting attended and reimbursement of reasonable expenses incident to
their service. Each non-officer Chairman of a Board Committee received an
additional annual retainer of $2,500. Also from 1987-1994, $15,000 of the
annual retainer paid to outside directors was paid in cash and $10,000 was paid
in stock units credited to their accounts on the Company's books. Beginning in
1994, directors were permitted to elect, effective on six-months advance
notice, to have all or any portion of the annual retainer, but not less than
$10,000, paid in such stock units. The number of such units to be credited is
determined as of May 1st of each year by dividing $10,000, or such greater
amount as a director may elect, by the then-current market price of the
Company's Common Stock. Upon retirement or other termination of a directorship,
an outside director will be entitled to receive a number of shares of the
Company's Common Stock equal to the number of stock units credited to his or
her account. The director's account is unfunded, and no payment is due until
the directorship terminates. Effective in 1995, the compensation payable to
directors was increased to $30,000 per year and $1,000 for each Board and
Committee meeting attended and the retainer paid to each non-officer Chairman
of a Board Committee was increased to $4,000. Of the $30,000 annual retainer,
at least $15,000 will be paid in stock, effective May 1, 1996.
Outside directors who complete at least five years continuous service on the
Board and who either remain on the Board until age 70 or are designated by the
Nominating and Board Procedures Committee may elect to receive annual cash
retirement payments equal to the annual retainer in effect at the time the
director retired or an equivalent lump sum benefit calculated using actuarial
assumptions and methodology. The retirement payments will continue for the
number of years of active service as a director. Officers of the Company
receive no additional compensation for their service as directors. No other
remuneration is paid to directors, and directors who are not employees of the
Company do not participate in the Company's employee benefit plans.
The Company or its subsidiaries have done business in 1994 with certain
organizations of which directors of the Company are or, since January 1, 1994,
were officers or directors. In no case have the amounts involved been material
in relation to the business of the Company or, to the knowledge and belief of
management of the Company, to the business of the other organizations or to the
individuals concerned. During 1994, the Company paid General Meyer and Mr.
Malott $120,000 and $208,234 respectively, and reimbursed them or paid for
expenses incurred in connection with consulting services they provided to the
Company, including office space and office support services for Mr. Malott. Mr.
Malott also receives certain benefits from the Company including payment of
dues and memberships and tax and financial counselling. The cost of such
benefits paid in or attributable to 1994 was $54,879.
Other Matters. There is no family relationship between any of the directors or
officers of the Company.
10
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SECURITY OWNERSHIP OF THE COMPANY
Management. The following table shows, as of March 1, 1995, the number of
shares of Common Stock of the Company beneficially owned by each director and
nominee, the chief executive officer and the four other most highly compensated
executive officers and of all executive officers as a group. No nominee,
director or executive officer owns beneficially more than 1 percent of the
outstanding Common Stock. As a group, the directors and officers own 3 percent
of the Common Stock.
<TABLE>
<CAPTION>
Beneficial Ownership on
March 1, 1995
-----------------------
Common Stock
Name of the Company (6)
---- -----------------------
<S> <C>
William F. Beck (1).......................... 91,446
William W. Boeschenstein (2)(3).............. 6,056
Larry D. Brady (1)........................... 86,040
Patricia A. Buffler (2)...................... 211
Robert N. Burt (1)........................... 133,672
B.A. Bridgewater, Jr. (2).................... 3,051
Albert J. Costello........................... 700
Paul L. Davies, Jr. (2)(4)................... 38,551
Jean A. Francois-Poncet (2).................. 2,251
William J. Kirby (1)......................... 66,853
Robert H. Malott (1)(2)(5)................... 355,452
Edward C. Meyer (2).......................... 3,551
Earl M. Morgan (1)........................... 40,137
William F. Reilly (2)........................ 12,974
James R. Thompson (2)........................ 983
Clayton Yeutter (2).......................... 639
All directors and executive officers as a
group
(29 persons) (1)(2)......................... 1,140,991
</TABLE>
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(1) Shares "Beneficially owned" include (i) shares owned by the individual,
(ii) shares held by the FMC Employees' Thrift and Stock Purchase Plan
("Thrift Plan") for the account of the individual and (iii) shares subject
to options that are exercisable within 60 days. Items (ii) and (iii) in the
aggregate are 87,191 shares for Mr. Burt, 71,340 shares for Mr. Brady,
234,700 shares for Mr. Malott, 73,979 shares for Mr. Beck, 46,331 shares
for Mr. Kirby and 34,937 shares for Mr. Morgan and 784,099 shares for all
directors and executive officers as a group. These numbers do not include
the undeterminable number of shares of Common Stock held in the Thrift Plan
that may be voted by the Plan Trustee if the beneficial owners, the
participants in the Thrift Plan, do not exercise their right to direct such
vote (see page 12).
(2) Includes shares credited to individual accounts of non-employee directors
under the FMC Deferred Stock Plan for Non-Employee Directors. (See
"Remuneration," page 9). Each of the non-employee directors has been
credited with a total of 2,051 shares except for Messrs. Boeschenstein,
2,156 shares, Thompson, 883 shares, Malott, 658 shares, Reilly, 974 shares,
Yeutter, 439 shares, Mrs. Buffler, 211 shares and Mr. Costello who became a
director after May 1, 1994, and therefore has not yet received an
allocation of shares. Directors have no voting or dispositive power over
these
11
<PAGE>
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shares until distributed after the director retires from the Board and, until
such distribution, directors have only an unsecured claim against the
Company.
(3) Includes 1,600 shares owned by Mr. Boeschenstein's wife and 300 by his son,
as to which shares he disclaims any beneficial interest.
(4) Includes 25,000 shares owned by Mr. Davies as direct beneficial owner;
4,500 shares held in trusts of which Mr. Davies is the trustee or a co-
trustee and 7,000 shares owned by Mr. Davies' wife. Mr. Davies disclaims
beneficial interest in 9,500 of these shares.
(5) Includes 31,492 shares owned by Mr. Malott's wife. Mr. Malott disclaims any
beneficial interest in such shares.
(6) Share interests shown above do not include ownership of common stock of FMC
Gold Company in which FMC beneficially owns 58,790,000 shares, or 80
percent of the outstanding stock (Mr. Burt, 1,000 shares; Mr. Davies, 1,000
shares; Mr. Brady, 3,000 shares; and all directors and executive officers
as a group, 8,700 shares).
Other Security Ownership. The following table shows the name and address of
each person known to the Company to own more than 5 percent of the Company's
outstanding shares of Common Stock as of March 1, 1995:
<TABLE>
<CAPTION>
Amount and Nature of
Name and Address of Beneficial Owner Beneficial Ownership % of Class
- ------------------------------------ ----------------------------------- ----------
<S> <C> <C>
FMC Employees' Thrift and Stock Purchase 7,932,958 shares held in trust for 21.4
Plan participants in the Thrift Plan (1)
c/o FMC Corporation
200 E. Randolph Drive
Chicago, IL 60601
State of Wisconsin Investment Board 2,426,375 shares (2) 6.6
P.O. Box 7842
Madison, WI 53707
Ohio State Teachers Retirement Systems 2,213,507 shares (2) 6.0
275 East Broad St.
Columbus, Ohio 43215
College Retirement Equities Fund 1,884,867 shares (2) 5.1
730 Third Avenue
New York, NY 10017
</TABLE>
- ------
(1) These shares may be voted by the Thrift Plan trustee if the beneficial
owners, the participants in the Thrift Plan, do not exercise their right to
direct such vote. Such shares may be tendered or sold by the trustee in
response to a tender or exchange offer only in accordance with the written
instructions of the participants. The trustee has no authority in such
circumstances to tender or sell shares as to which no instructions have
been furnished.
(2) The number of shares of stock beneficially owned was determined by a review
of Schedule 13Gs, as amended, as supplemented by Schedule 13Fs filed with
the Securities and Exchange Commission and which state that the beneficial
owners had sole voting and dispositive power as to all of the shares shown.
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II. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
KPMG Peat Marwick, LLP, which has served as independent auditors for the
Company since 1928, has been recommended by the Audit Committee of the Board to
act in that capacity in 1995.
A representative of KPMG Peat Marwick LLP, is expected to be present at the
meeting, with the opportunity to make a statement if such representative
desires to do so, and will be available to respond to appropriate questions.
RECOMMENDATION OF THE BOARD
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE SELECTION OF
KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITORS FOR THE YEAR 1995.
III. APPROVAL OF FMC INCENTIVE COMPENSATION PLANS
The continued success of FMC and its subsidiaries depends on their ability to
attract, retain and motivate key employees. Accordingly, management and the
Compensation and Organization Committee of the Board of Directors (the
"Committee") have reviewed FMC's annual and long-term incentive compensation
programs for key employees and recommend that stockholders approve the FMC 1995
Management Incentive Plan (the "Incentive Plan") and the FMC 1995 Stock Option
Plan (the "Option Plan") (together, the "Plans"). The Plans continue, with
differing emphasis, many of the features of the FMC 1990 Incentive Share Plan
(the "1990 Plan") and predecessor plans, which were approved by stockholders.
As of December 31, 1994, there were approximately 300,000 shares authorized
under the 1990 Plan that had not been used and are available for awards under
that plan. The approval of FMC's stockholders is required for adoption of the
Plans.
The principal features of the Plans are described below. The full text of each
of the Plans is annexed hereto as Exhibit A and Exhibit B and should be
referred to for a complete description of their provisions.
Overview. For a number of years, the Company's key employees received incentive
compensation consisting of an annual cash bonus and stock options. The bonus
was based on the overall performance of the business and individual or business
unit strategic objectives and could pay out at anywhere from zero to a maximum
of two times the target.
The stock option component typically involved biennial grants of options that
became exercisable after four years. For a more complete description of the
current practice, see the Compensation Committee Report on Executive
Compensation at page 21 and the description of executive compensation beginning
at page 17.
Management's study of the current compensation program concluded that
stockholder value could be enhanced by putting more emphasis on the Company's
growth strategies in the new Plans.
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Thus, the new Plans are designed to:
. stimulate growth through multi-year incentives and increased reliance on
stock payouts
. encourage top-quartile return on investment performance by targeting
stretch and breakthrough improvements in net contribution (as defined in
the Plan) on a business-by-business basis
. encourage prudent risk-taking to reach stretch targets by providing a more
significant payout for breakthrough performance
Generally. The new Plans provide for the grant of two basic types of incentive
awards to key employees selected by the Committee--(i) a rolling three-year
incentive award, granted annually and payable partly in cash and partly in
stock, and (ii) stock options. In addition, the Incentive Plan gives the
Committee broad discretion to craft other types of awards as it deems
appropriate.
PROVISIONS COMMON TO BOTH PLANS
Administration. The Plans vest broad powers in the Committee to administer and
interpret the Plans. The Committee must consist of two or more members, all of
whom are considered disinterested for purposes of the Securities Exchange Act
of 1934. Except when limited by the terms of the Plan, the Committee's powers
include, among other things, authority to select the persons to be granted
awards, to determine the type, size and term of awards, to determine the time
when awards will be granted and any conditions for receiving awards, to
establish objectives and conditions for earning awards and to determine whether
such conditions have been met.
Eligibility. Key employees of FMC and its divisions, subsidiaries and
affiliates (including partnerships, joint ventures or other entities in which
FMC has a substantial investment) are eligible to be granted awards under the
Plans. If the Plans are approved by stockholders, it is intended that a group
of approximately 250 persons, including the Company's Chief Executive Officer
and other executive officers, will be granted awards in 1995 and be
participants in the Plans.
Shares of Stock Subject to the Plans. The aggregate number of shares of the
Company's Common Stock that may be delivered under the Plans may not exceed 3.0
million shares provided that, in the event of any change in such stock by
reason of a split, stock dividend, merger or similar event, such equitable
adjustment shall be made in the Plan and awards as shall be deemed appropriate
by the Committee. Subject to such an equitable adjustment, the number of shares
of Common Stock for which Options may be granted during a Plan Year under the
Option Plan may not exceed 100,000 shares for any Participant.
Assignment. No award under the Plans shall be assignable or transferable.
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Amendment and Termination. The Committee may amend or terminate the Plans so
long as such action does not adversely affect any rights or obligations with
respect to awards already outstanding under the Plans. Unless the stockholders
of FMC shall have first approved thereof, no amendment of the Plans may
increase the maximum number of shares which can be delivered under the Plans or
to any one individual.
Federal Tax Consequences. Under the Internal Revenue Code as presently in
effect, a grant under the Plans of stock options or Restricted Stock (provided
elections to receive Restricted Stock are promptly and timely made by the
employee) would have no federal income tax consequence at the time of grant.
The payment of other awards, whether paid in shares of unrestricted Common
Stock, cash or both, is taxable to a participant as ordinary income. Upon
exercise under the Option Plan of a non-qualified stock option, the excess of
the fair market value of the stock at the date of exercise over the exercise
price is also taxable to a participant as ordinary income. Exercise of an
Incentive Stock Option has no federal income tax consequences at the time of
exercise absent a disqualifying disposition. Restricted Stock awarded under the
Incentive Plan is taxable to a Participant as ordinary income in the year it
becomes vested. Any draw under the Incentive Plan during the 1995-1996
transitional period will be taxed as ordinary income in the year it is
received. All amounts taxable as ordinary income to employees under the Plans
in respect of stock options and other awards are deductible by FMC as
compensation subject to the limitations of Section 162(m) of the Internal
Revenue Code. Upon a sale of Common Stock acquired under the Plans that is not
a disqualifying disposition, the participants realize long- or short-term gain
or loss, and FMC receives no further deduction.
Additional Information. Benefits to be received or which would have been
received if the Plans had been in effect in 1994 are not determinable.
Reference should be made to sections captioned "Summary Compensation Table,"
"Option Grants in Last Fiscal Year" and "Aggregated Option Exercises in Last
Fiscal Year and FY-End Option Values" at pages 16 through 18 of this Proxy
Statement, for detailed information on stock option and bonus awards and
payments or exercises of such awards by certain executive officers during the
three most recent fiscal years.
A. FMC 1995 MANAGEMENT INCENTIVE PLAN
The Incentive Plan provides for the grant of a multi-year incentive award to
key employees selected by the Committee consisting of a rolling three-year
incentive award, granted annually and payable partly in cash and partly in
stock. The Incentive Plan also gives the Committee broad discretion to craft
other types of awards as it deems appropriate.
The following is a description of the principal terms of the Incentive Plan:
Multi-Year Awards. Each performance period consists of three consecutive fiscal
years and a new performance period commences annually. The target award is
based upon a specified percentage of the participant's base salary at the time
the award is granted. However, the payout of a multi-year award may vary from
zero to three times the target based on performance. The performance measure
15
<PAGE>
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for a multi-year award is based on Net Contribution, as that term is defined in
the Plan, and the extent to which that measure is achieved will be determined
by the Committee. The form of payout of multi-year awards will be partly in
cash and partly in Common Stock, which is not restricted, or Restricted Stock,
as elected by the Participant provided that, if the Participant does not then
own a sufficient amount of Common Stock under the Company's stock retention
policy, the payment will be in Restricted Stock. Restricted Stock issued in
payment of a long-term award will vest in three years and the number of shares
will be 20 percent higher than the number of shares received by the Participant
who takes unrestricted stock. The portion to be paid in cash will be determined
by the Committee at the time the award is granted.
Adjustments. The Committee may adjust the multi-year awards of any participant
or performance measures under the Incentive Plan upward or downward as it deems
equitable in its absolute discretion in the event of changes in Common Stock
due to stock dividends or splits, recapitalizations, mergers or similar
corporate changes, or to reflect changes in tax laws, accounting practices or
inflation that affect performance measures. To the extent that such discretion
subjects the Company to the limitation on its tax deduction of a participant's
compensation as set forth in Section 162(m) of the Internal Revenue Code, the
Committee believes that it is in the best interest of the Company and its
stockholders to preserve the Committee's authority to so act and that, in any
event, such limitation should not have a material effect on the Company's tax
liability or earnings.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE FMC 1995
MANAGEMENT INCENTIVE PLAN.
B. FMC 1995 STOCK OPTION PLAN
The Option Plan provides for regular grants of stock options with an exercise
price of not less than 100 percent of the fair market value of a share of stock
on the date of grant and with a term as specified by the Committee in the grant
but not more than 10 years in the case of an Incentive Stock Option. It is
intended that options granted under the Option Plan will qualify as
"Performance Based Compensation" under Section 162(m) of the Internal Revenue
Code and, therefore, the Company should be entitled to a tax deduction for
amounts paid under the Plan subject to the other prerequisites of that Section
of the Internal Revenue Code. Generally, in the event of the death, disability
or retirement of a holder of stock options, such options shall vest in full,
continue to be exercisable on and after the date fixed in the grant and shall
be exercisable during the remaining term of the options. Special rules on
exercise apply to Incentive Stock Options.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE FMC 1995 STOCK
OPTION PLAN.
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IV. EXECUTIVE COMPENSATION
The following tables, charts and narrative show all compensation that has been
awarded or paid to or earned by the Chief Executive Officer and each of the
four most highly compensated executive officers other than the CEO during the
years shown:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Long Term
Compensation Compensation
--------------- ------------
Awards(1)
---------
Securities
Underlying All Other
Name And Principal Salary Bonus Options/SARs Compensation(2)
Position Year ($) ($) (#) ($)
(A) (B) (C) (D) (E) (F)
------------------ ---- ------ ----- ------------ ---------------
<S> <C> <C> <C> <C> <C>
ROBERT N. BURT 1994 641,663 526,168 80,300 48,748
Chairman of the Board 1993 562,500 313,875 -- 44,121
and Chief Executive Officer 1992 508,333 391,518 55,000 30,193
LARRY D. BRADY(3) 1994 414,833 327,717 48,600 30,292
President 1993 375,805 182,191 -- 28,519
1992 348,851 232,398 31,400 21,148
WILLIAM F. BECK(4) 1994 336,100 217,378 29,800 293,139
Executive Vice President 1993 317,100 118,294 -- 269,166
1992 302,500 156,026 22,100 228,195
WILLIAM J. KIRBY 1994 309,258 211,532 30,200 23,077
Senior Vice President-- 1993 286,350 143,805 -- 22,044
Administration 1992 278,010 177,698 18,300 16,286
EARL M. MORGAN 1994 262,002 196,895 20,800 11,643
Vice President and 1993 235,481 139,240 -- 17,262
General Manager-- 1992 196,961 130,341 13,600 11,923
Agricultural Chemical Group
</TABLE>
- ------
(1) Employees who were granted options in 1992 and 1994 were also granted
contingent performance awards which become payable, in cash, in 1996 and
1998 only if (i) the Compensation and Organization Committee determines
that the options then have little or no value, (ii) the employee has
continued in the employment of the Company, and (iii) performance
objectives established by the Committee are achieved (See Compensation
Committee Report on pages 20 to 22). The amounts of such contingent awards
in 1992 and 1994, respectively, were $1,020,000 and $1,298,500 for Mr.
Burt, $583,000 and $785,000 for Mr. Brady, $410,500 and $482,000 for Mr.
Beck, $339,500 and $488,500 for Mr. Kirby and $252,000 and $336,500 for Mr.
Morgan. Contingent awards have been made under the Plan since 1986, but the
value of the options granted has been such that no contingent awards have
been paid.
(2) Consists of annual Company matching contributions to Thrift [401 (k)] plans
and, in the case of Mr. Beck, $268,987 in payments in 1994 attributable to
Mr. Beck's overseas assignment designed to equalize the cost of living and
tax costs associated with such an assignment with those associated with a
domestic assignment.
17
<PAGE>
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(3) Mr. Brady became President on October 22, 1993, after serving as Executive
Vice President since September 1989.
(4) Mr. Beck was elected Executive Vice President on June 10, 1994, after
serving as Vice President, Europe and General Manager--Chemical Products
Group.
OPTION GRANTS
Shown in the table below is information on grants of stock options in 1994
pursuant to the Incentive Share Plan, to the officers named in the Summary
Compensation Table. No stock appreciation rights were granted under that Plan
during 1994. The table also shows that an increase in the value of such
options, if any, will be .6 percent of the increase in value to the other
stockholders of the Company.
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates of Stock
Individual Grants Appreciation for Option Term(2)(3)
-------------------------------------- -----------------------------------
Percent of
Total
(1) Options
Options Granted to Exercise
Granted Employees or Base
in 1994 in Fiscal Price Expiration 0% 5% 10%
(#) Year ($/SH) Date ($) ($) ($)
Name (A) (B) (C) (D) (E) (F) (G) (H)
-------- ------- ---------- -------- ---------- ------------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Robert N.
Burt 80,300 9.4 46.25 3/31/09 0 4,007,004 11,799,898
Larry D.
Brady 48,600 5.7 46.25 3/31/09 0 2,425,160 7,141,657
William F.
Beck 29,800 3.5 46.25 3/31/09 0 1,487,033 4,379,041
William J.
Kirby 30,200 3.5 46.25 3/31/09 0 1,506,992 4,437,820
Earl M.
Morgan 20,800 2.4 46.25 3/31/09 0 1,037,929 3,056,512
All
Stockholders N/A N/A N/A N/A 0 1,837,010,645 5,409,662,458
All Optionees 851,550 100% 46.25 3/31/09 0 42,492,704 125,133,288
Optionee Gain
as % of all
Stockholder
Gain N/A N/A N/A N/A N/A 2.3% 2.3%
</TABLE>
- ------
(1) The date of grant for these options was March 31, 1994 and they become
exercisable January 2, 1998.
(2) The dollar amounts under these columns are the result of calculations at 0
percent and at the arbitrary 5 percent and 10 percent rates set by the SEC
and therefore are not intended to forecast possible future appreciation, if
any, in the Company's stock price. The Company did not use an alternative
formula for a grant date valuation as it is not aware of any formula that
will determine with reasonable accuracy a present value based on future
unknown or volatile factors.
(3) No gain to the optionees is possible without appreciation in the stock
price which will benefit all stockholders commensurately.
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AGGREGATED OPTION EXERCISES IN 1994 AND YEAR-END OPTION VALUES
Shown below is information with respect to options to purchase the Company's
Common Stock exercised in 1994 by the officers named in the Summary
Compensation Table and unexercised options held by them at December 31, 1994.
<TABLE>
<CAPTION>
Value of
Unexercised
in-the-Money
Number of Securities Options
Underlying Unexercised at December 31,
Options/SARs at 1994
December 31, 1994 (#) ($)(1)
Shares Acquired Value ---------------------- -------------------
on Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
(A) (B) (C) (D) (E)
---- --------------- -------- ---------------------- -------------------
<S> <C> <C> <C> <C>
Robert N.
Burt -- -- 50,100/135,300 1,464,425/1,549,075
Larry D.
Brady -- -- 64,420/ 80,000 2,145,803/ 916,075
William F.
Beck -- -- 64,300/ 51,900 2,096,300/ 594,088
William J.
Kirby 2,094 100,135 39,100/ 48,500 1,147,700/ 555,463
Earl M.
Morgan 3,700 184,797 29,000/ 34,000 1,005,588/ 393,900
</TABLE>
- ------
(1) The closing price of the Company's Common Stock at December 31, 1994, was
$57.75
RETIREMENT PLANS
Under the Company's Pension Plan and its supplements, "covered remuneration"
includes only the remuneration appearing in Columns (C) and (D) of the Summary
Compensation Table on page 16. The following table shows the estimated annual
retirement benefits under the Pension Plan for eligible salaried employees
(including officers) payable to employees at various salary levels who retire
in 1995 at age 65 (normal retirement age) for representative years of service.
The amount shown will not be reduced by Social Security benefits or other
offsets. Payment of benefits shown is contingent upon continuance of the
present provisions of the Pension Plan until the employee retires.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
Estimated Annual Retirement Benefits
for Years of Service Indicated
---------------------------------------------------------------
Final Average 15 20 25 30 35
Earnings Years Years Years Years Years
------------- ----- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
$ 50,000 9,306 12,408 15,510 18,612 21,714
150,000 31,806 42,408 53,010 63,612 74,214
250,000 54,306 72,408 90,510 108,612 126,714
350,000 76,806 102,408 128,010 153,612 179,214
450,000 99,306 132,408 165,510 198,612 231,714
550,000 121,806 162,408 203,010 243,612 284,214
650,000 144,306 192,408 240,510 288,612 336,714
750,000 166,806 222,408 278,010 333,612 389,214
900,000 200,556 267,408 334,260 401,112 467,964
1,000,000 223,056 297,408 371,760 446,112 520,464
</TABLE>
19
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Final average earnings in the above table means the average of covered
remuneration for the highest 60 consecutive calendar months out of the 120
calendar months immediately preceding retirement. Benefits applicable to a
number of years of service or final average earnings different from those in
the above table, or to a person who retires after 1995, are equal to the sum of
(A) 1 percent of allowable Social Security Covered Compensation ($25,920 for a
participant retiring at age 65 in 1995) times years of credited service and (B)
1.5 percent of the difference between final average earnings and allowable
Social Security Covered Compensation times years of credited service. ERISA
limits the annual benefits that may be paid from a tax-qualified retirement
plan. Accordingly, as permitted by ERISA, the Company has adopted supplemental
arrangements to maintain total benefits upon retirement at the levels shown in
the table. At March 1, 1995, Messrs. Burt, Brady, Beck, Kirby and Morgan had,
respectively 21, 17, 31, 33 and 19 years of credited service under the Plan.
TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS
In 1983, on the recommendation of the Compensation and Organization Committee,
the Board of Directors adopted an Executive Severance Plan designed to serve
the best interests of the Company and its stockholders. The purpose of this
plan is (1) to ensure that the stockholders' interest is protected during
negotiations relating to possible business combination transactions by placing
executives responsible for negotiations in an objective, impartial position;
and (2) to encourage key managers to remain with the Company to run the
Company's businesses. All of the persons named in the Summary Compensation
Table are participants in this plan and, upon termination of their employment
due to a "change in control" of the Company within two years of that change in
control, could be entitled to benefits from the Company including (i) a cash
payment in an amount equal to, in the case of the Company's Chairman and its
President, three times their respective annual compensation (including bonuses)
or, in the case of other participating executives, up to two times annual
compensation, (ii) acceleration of the vesting of Performance Awards and the
exercise date of options held by them under the Incentive Plan, and (iii)
continuation of their usual employee benefits for up to three years after
termination.
The Executive Severance Plan defines "change in control" as a transaction that
would be required to be reported in response to Item 5 (f) of Schedule 14A
under the Exchange Act; provided that, without limitation, such a change in
control shall be deemed to have occurred if (i) any person, entity or group is
or becomes the beneficial owner, directly or indirectly, of securities of the
Company representing 20 percent or more of the combined voting power of the
Company's then outstanding securities, or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors cease for any reason to constitute at least a majority
thereof unless the election or the nomination for election by the Company's
stockholders, of each new director was approved by a vote of at least two-
thirds of the directors then still in office who were directors at the
beginning of such period. In addition, either the Company's Chairman or its
President would be entitled to receive benefits under the Executive Severance
Plan in the event he voluntarily terminates his employment with the Company
within two years after a change in control resulting from (i) one or more
persons owning from
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20 percent to 50 percent of the outstanding voting shares of the Company, and
the Board approves the payment of such benefits, or (ii) one or more persons
owning more than 50 percent of such shares. The Executive Severance Plan
provides that no payment may be made to any participant if such payment would
be nondeductible by the Company under Section 280G of the Internal Revenue
Code.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
FMC's executive compensation program is designed to align total compensation
with shareholder interests. The program:
. Incents and rewards executives for sound business management and
improvement in shareholder value.
. Balances its components so that annual financial and longer-term strategic
objectives are recognized.
. Requires achievement of objectives within a "high performance" environment
to be rewarded financially.
. Attracts, motivates and retains executives necessary for the long-term
success of FMC Corporation.
The program comprises three compensation components--base salary, variable
incentive awards (annual bonus) and long-term incentive awards (stock options).
Base Salary. FMC uses external surveys to set competitive compensation levels
(salary ranges) for its executives. In order to obtain the most comprehensive
survey data for review, the group of companies in the surveys is broader than
the Dow Jones Diversified Industrial Index and includes a majority of
comparable companies at the Fortune 500 level. Performance graph companies are
well represented.
Salary ranges for FMC executives are established that relate to similar
positions in other companies of comparable size and complexity. Generally, the
Company sets its competitive salary midpoint for an executive officer at the
median level compared with the companies surveyed. Target performance levels
are delineated to recognize different levels of performance ranging from a
"learner" or "needs improvement" level to an "exceptional" level. Thus,
although compensation is nominally targeted to fall at or near the 50th
percentile of such comparable organizations, it may range anywhere within the
salary bracket based on performance.
Starting placement in a salary range is a function of an employee's
contribution (i.e., skills, experience and expertise, and anticipated job
performance). Each year, performance is evaluated against mutually agreed-upon
objectives and performance standards that may, in large part, be highly
subjective; a performance rating is established; and a salary increase may be
granted. Corporate performance factors used include timely responses to
downturns in some major markets, setting strategic direction for the future,
making key management changes, divesting some businesses and acquiring new
businesses while continuing to improve operating efficiency. The relative
importance of each of these factors varies based on the strategic thrust of
each of our businesses, from high growth to consolidation, from increased
capital spending to conserving cash flow.
21
<PAGE>
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In 1994, R.N. Burt's salary range was increased to a level competitive with
CEOs in comparable companies. A salary increase was granted, which placed him
at his salary range midpoint. In determining Mr. Burt's salary increase, the
Compensation Committee considered successful first year implementation of the
joint venture with Harsco Corporation, a major companywide restructuring,
completion of several strategic acquisitions, improved operating results during
a difficult period for certain of the Company's businesses, and significant
appreciation during the year in stockholder value.
Variable Incentive Award (annual bonus). All executives participate in FMC's
Management Incentive Plan. Achievement of high standards of business and
individual performance are rewarded financially, and significant compensation
is at risk if those high standards are not met. At the executive level, target
incentives approximate one-half of base salary, while actual payments can range
from zero to twice the target incentive, and are calculated by comparing
financial performance and individual strategic performance with objectives
established for the year.
For 1994, business performance was weighted at [40] percent of the total, and
it is evaluated against two targets--Operating Profit After Tax [(70 percent)]
and Working Capital [(30 percent).] Individual strategic performance, weighted
at [60] percent of the total, was more subjective and varied in relation to the
needs of the Company's different businesses, both as to type and relative
importance. In 1994 it included such disparate objectives as a companywide
restructuring, important changes in executive management and implementation of
the defense joint venture concluded at the beginning of the year. In 1994, Mr.
Burt's annual bonus was based on those business performance targets and
achievement of more subjective strategic objectives focusing on stockholder
value and globalization in order of importance. OPAT and Working Capital
performance in 1994 was significantly ahead of plan. Mr. Burt's strategic
objectives were met as regional business opportunities emerged, companies were
acquired, a major joint venture accomplished, and corporate restructuring was
initiated.
Long-term Incentive Awards. This plan is designed to link closely the long-term
reward of executives with increases in shareholder value. While giving broad
discretion to the Committee to select appropriate types of awards, it has
consisted of a combination of non-qualified stock options and a conditional
dollar award payable only if (i) the stock option has little or no value at the
end of a four-year performance period, (ii) financial performance targets are
met, and (iii) the Compensation Committee approves payment. The award vesting
period is four years, with an option term of 15 years. To determine the number
of options to be granted to an executive, the Committee first multiplies the
midpoint of the salary range for an executive's salary grade by a percentage
applicable to that grade (ranging from 50 percent to 100 percent) and divides
that product by the then current market price for the Company's shares. The
Committee then applies a multiple based on comparative data, individual
contributions and potential and current business conditions. In recent years
that multiple has ranged from one to three. In approving grants under the Plan,
the number of options previously awarded to and held by executive officers is
considered but is not regarded as a significant factor in determining the size
of current option grants. Performance targets applicable to the conditional
dollar award have been a combination of return on investment and growth in
capital employed, weighted equally. The Committee believes that return on
investment and growth in capital employed are the criteria most likely to be
reflected in shareholder value. To date, no conditional dollar awards have been
paid because of the gain in the stock option value.
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The Committee will continue to review the $1 million cap on tax-deductible
compensation, but believes that it is not now a significant issue for FMC.
Stock Retention Policy. The Company has established guidelines setting forth
expectations for ownership of stock by officers and management. The guidelines
for stock retention are based on a multiple of the employee's total
compensation midpoint.
The preceding report has been furnished by the following members of the
Compensation and Organization Committee:
Paul L. Davies, Jr., Chairman
William W. Boeschenstein
B.A. Bridgewater, Jr.
Edward C. Meyer
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STOCKHOLDER RETURN PERFORMANCE PRESENTATION
The following charts compare the yearly percentage change in the cumulative
shareholder return on the Company's Common Stock against the cumulative total
return of the S&P Composite--500 Stock Index and the Dow Jones Diversified
Industrials Index for the five years commencing January 1, 1990 and ended
December 31, 1994, and for the 10 years commencing January 1, 1985 and ended
December 31, 1994.
[GRAPH APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
FMC CORPORATION, S&P 500 INDEX AND DOW JONES DIVERSIFIED INDUSTRIAL INDEX
<TABLE>
<CAPTION>
DOW JONES
DIVERSIFIED
Measurement Period FMC S&P INDUSTRIAL
(Fiscal Year Covered) CORPORATION 500 INDEX INDEX
- ------------------- ---------- --------- ----------
<S> <C> <C> <C>
Measurement Pt-
12/31/89 $100 $100 $100
FYE 12/31/90 $90.43 $96.89 $92.95
FYE 12/31/91 $135.82 $126.42 $115.09
FYE 12/31/92 $140.43 $136.05 $133.93
FYE 12/31/93 $133.69 $149.76 $163.65
FYE 12/31/94 $163.83 $151.74 $150.10
</TABLE>
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[GRAPH APPEARS HERE]
COMPARISON OF TEN YEAR CUMULATIVE TOTAL RETURN AMONG
FMC CORPORATION, S&P 500 INDEX AND DOW JONES DIVERSIFIED INDUSTRIAL INDEX
<TABLE>
<CAPTION>
Measurement Period FMC S&P DOW JONES DIVERSIFIED
(Fiscal Year Covered) CORPORATION 500 INDEX INDUSTRIALS INDEX
- ------------------- ----------- --------- ---------------------
<S> <C> <C> <C>
Measurement Pt-
12/31/84 $100 $100 $100
FYE 12/31/85 $120.15 $131.73 $132.45
FYE 12/31/86 $269.26 $156.32 $153.92
FYE 12/31/87 $352.92 $164.52 $172.27
FYE 12/31/88 $334.62 $191.85 $196.99
FYE 12/31/89 $368.61 $252.64 $247.60
FYE 12/31/90 $333.31 $244.79 $230.15
FYE 12/31/91 $500.62 $319.38 $284.97
FYE 12/31/92 $517.62 $343.71 $331.61
FYE 12/31/93 $492.78 $378.35 $405.20
FYE 12/31/94 $603.88 $383.35 $371.64
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LOGO
V. VOTE REQUIRED
Under Delaware law, directors are elected by a plurality of the votes of the
shares present in person or represented by proxy at the meeting and entitled to
vote on the election of directors. This means that the four nominees for
election as directors at the Annual Meeting who receive the greatest number of
votes cast for the election of directors by the holders of the Company's Common
Stock entitled to vote at that meeting, a quorum being present, shall become
directors at the conclusion of the tabulation of votes. An affirmative vote of
the holders of a majority of the Company's Common Stock present in person or
represented by proxy and entitled to vote at the meeting, a quorum being
present, is necessary to approve the actions proposed in items II, III-A and
III-B of this Proxy Statement.
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Under Delaware law and the Company's Restated Certificate of Incorporation and
By-Laws, the aggregate number of votes entitled to be cast by all stockholders
present in person or represented by proxy at the meeting, whether those
stockholders vote "FOR," "AGAINST" or abstain from voting, will be counted for
purposes of determining the minimum number of affirmative votes required for
approval of items II, III-A and III-B, and the total number of votes cast "FOR"
either of these matters will be counted for purposes of determining whether
sufficient affirmative votes have been cast. An abstention from voting and
broker non-votes on a matter have the same legal effect as a vote "against" the
matter.
VI. COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act requires the Company's officers
and directors, and persons who own more than 10 percent of a registered class
of the Company's equity securities, to file reports of ownership and changes in
ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission (SEC)
and the Pacific Stock Exchange. Such persons are required by SEC regulation to
furnish the Company with copies of all Forms 3, 4 and 5 they file although the
Company has undertaken the preparation and filing of such reports on behalf of
its officers and directors.
Based solely on the Company's review of the copies of the forms it has filed
and copies of such forms it has received, the Company believes that all its
officers, directors and greater than 10 percent beneficial owners complied with
all filing requirements applicable to them with respect to transactions during
fiscal 1994.
VII. PROPOSALS FOR 1996 ANNUAL MEETING
Stockholder proposals for the 1996 Annual Meeting must be received at the
principal executive offices of the Company, 200 East Randolph Drive, Chicago,
Illinois 60601, not later than November , 1995, for inclusion in the 1996
proxy statement and form of proxy. Under the Company's by-laws, for a proposal
not included in the proxy statement to be properly brought before an annual
meeting by a stockholder, the stockholder must give notice thereof to the
Secretary of the Company not less than 60 or more than 90 days prior to the
meeting setting forth (i) a description of the business, (ii) the stockholder's
name and address, (iii) the class and number of shares owned beneficially by
the stockholder, and (iv) any material interest of the stockholder in such
business.
VIII. OTHER MATTERS
The Board does not know of any other business which, if presented, would be
proper for a stockholder meeting and which may be presented for consideration
at the meeting. If any business not described herein should come before the
meeting, the persons named in the enclosed proxy will vote on those matters in
accordance with their best judgment.
Robert L. Day
Secretary
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EXHIBIT A
FMC 1995 MANAGEMENT INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of the FMC 1995 Management Incentive Plan is to promote the long-
term performance of FMC by (i) providing long-term incentives in cash and
common stock of FMC to key management employees of FMC and its subsidiaries,
(ii) assisting in attracting and retaining as employees persons whose
abilities, experience and judgment have contributed and will continue to
contribute to the financial success and progress of FMC, and (iii) aligning the
identity of interests of those employees and FMC's shareholders.
2. DEFINITIONS
(a) "Award" means a Three Year Incentive Award or an Incentive Benefit.
(b) "Board of Directors" means the Board of Directors of FMC as it may be
constituted from time to time.
(c) "CEO" means the Chief Executive Officer of FMC.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means the Compensation and Organization Committee of the Board
of Directors.
(f) "Common Stock" means the common stock of FMC.
(g) "Date of Grant" means the date which is designated by the Committee as the
date of grant of an Award.
(h) "Disability" means complete and permanent inability by reason of illness or
accident to perform the duties of the occupation at which a Participant was
employed when such disability commenced.
(i) "Disinterested Person" means any member of the Board of Directors who, at
the time discretion under the Plan is exercised, has not at any time within one
year prior thereto received grants or awards of equity securities under the
Plan or any other plan of FMC or any of its affiliates (as that term is used in
the Exchange Act) except as provided in Rule 16b-3(c)(2)(i), and is not
selected as a person to whom equity securities may be allocated or granted
pursuant to any other plan of FMC or any of its affiliates (as that term is
used in the Exchange Act) entitling the participants therein to acquire equity
securities of FMC or of any such affiliates except as provided in Rule 16b-
3(c)(2)(i).
(j) "Employee" means any person employed by the FMC Companies.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(l) "Fair Market Value" means the closing price of a share of Common Stock on a
specified date as reported in the New York Stock Exchange Composite
Transactions for such date, or such other measurement of value as may be
specified by the Committee from time to time.
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(m) "Financial Objective" means Net Contribution.
(n) "FMC" means FMC Corporation.
(o) "FMC Company" or "FMC Companies" means FMC and each Subsidiary Company.
(p) "Incentive Benefit" means an Award granted pursuant to Section .
(q) "Net Contribution" means for a business unit, operating profit after tax
less the product of 11.5% (the capital charge) and the unit's Capital Employed
(operating working capital plus net property, plant and equipment).
(r) "Option" means an Incentive Stock Option or a Nonqualified Stock Option.
(s) "Parent Corporation" means a corporation which, with respect to another
corporation, is a parent corporation within the meaning of Section 424(e) of
the Code.
(t) "Participant" means an Employee who has received an Award which has not
been exercised, paid cancelled or forfeited and which has not expired.
(u) "Plan" means the FMC 1995 Management Incentive Plan.
(v) "Plan Year" means each calendar year commencing on or after January 1,
1995.
(w) "Restricted Stock" means Common Stock payable as part of an Award which is
subject to a restriction period before it is paid to a Participant, and such
other restrictions as may be specified by the Committee at the time the Award
is granted.
(x) "Subsidiary Company" means (i) any corporation the majority of the voting
power of all classes of stock entitled to vote or the majority of the total
value of shares of all classes of stock of which is owned, directly or
indirectly, by FMC, or (ii) any trade or business other than a corporation the
majority of the profits interest, capital interest or actuarial interest of
which is owned, directly or indirectly, by FMC.
(y) "Subsidiary Corporation" means a corporation or other entity that, with
respect to another corporation, is a subsidiary corporation within the meaning
of Section 424(f) of the Code.
(z) "Three-Year Incentive Award" means an award payable in cash and either
Common Stock or Restricted Stock based on achievement of a Participant's unit's
Financial Objectives over a Three-Year Period.
(aa) "Three-Year Incentive Target Bonus" means the target bonus established for
each Participant which is the basis for the Participant's Three-Year Incentive
Award.
(ab) "Three-Year Period" means a period of three years commencing on January 1
of each Plan Year.
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3. ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Committee, the composition of which shall
consist of not less than two members of the Board of Directors who are
Disinterested Persons, and otherwise satisfy the provisions of Rule 16b-3 of
the General Rules and Regulations under the Exchange Act or any successor to
such rule. Except as limited by the express provisions of the Plan or by
resolutions adopted by the Board of Directors, the Committee shall have the
authority and discretion to interpret the Plan, to establish and revise rules
and regulations relating to the Plan, and to make any other determinations that
it believes necessary or advisable for the administration of the Plan.
Decisions and determinations by the Committee shall be final and binding on all
persons. Notwithstanding anything to the contrary contained in the Plan, the
Board of Directors shall also have all power and authority to perform any act
granted to the Committee pursuant to the Plan.
4. PARTICIPATION
Participants shall be determined by the Committee, in its sole discretion, from
Employees who, in the Committee's judgment, have a significant opportunity to
influence the growth of FMC or whose outstanding performance or potential merit
further incentive and reward for continued employment and accomplishment.
5. SHARES OF COMMON STOCK SUBJECT TO THE PLAN
Subject to adjustment pursuant to Section 9, at no time may the sum of (a) the
number of shares of Common Stock issued in payment of Awards and subject to
outstanding Awards under this Plan and (b) the number of shares of Common Stock
issued or subject to outstanding options under the FMC 1995 Stock Option Plan
exceed 3.0 million. In the event that any outstanding Award for any reason
expires, terminates, is cancelled or forfeited, without having been exercised
or otherwise realized in full, the shares of Common Stock allocable to the
expired, terminated, cancelled or forfeited portion of such Award shall (unless
the Plan shall have been terminated) become available for subsequent grants of
Awards.
6. THREE-YEAR INCENTIVE AWARDS
(a) Financial Objectives. The Committee, after consultation with the CEO, shall
establish the Financial Objective for each unit for each Three-Year Period. A
Three Year Incentive Target Bonus shall be established by the CEO for each
Participant.
(b) Individual Awards. Following the close of each Three-Year Period, the
Committee shall evaluate the performance of each unit against the unit's
Financial Objective for the Three-Year Period, and certify a rating of zero to
three for the unit. A Participant's Three-Year Incentive Award shall be the
product of the rating for the Participant's unit and Three-Year Incentive
Target Bonus.
(c) Form and Time of Payment
(i) Form. Each Three-Year Incentive Award will be paid partly in cash and
partly in either Common Stock that is not Restricted Stock or Restricted
Stock, as elected by the Participant; provided, however, that if a
Participant is covered by FMC's Stock Ownership Policy and such Participant
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does not own a sufficient amount of Common Stock under the Stock Ownership
Policy guidelines, such Participant shall receive the stock portion of the
Three-Year Incentive Award in Restricted Stock. The number of shares of
stock payable shall be equal to (A) the quotient of the stock portion of the
Participant's Three-Year Incentive Award divided by the Fair Market Value on
the last day of the Three-Year Period to which the award relates plus (B) 20
percent of the quotient in (A) provided that, if the Participant receives
Common Stock that is not restricted, the number of shares payable shall be
reduced by one-sixth. The portion of the Three-Year Incentive Award to be
paid in cash and in stock shall be as determined by the Committee at the
date of grant of the Award.
(ii) Timing. Payment of the portion of each Three-Year Incentive Award
payable in cash or Common Stock that is not Restricted Stock shall be made,
without interest, as soon as practicable after the close of the Three-Year
Period to which such award relates. Payment of any portion of a Three-Year
Incentive Award payable in Restricted Stock will be made as soon as
practicable following the close of three years after the end of the Three-
Year Period to which such award relates.
(d) Special Rules for Transition Period
Each Participant in the 1995 and/or 1996 Plan Years shall receive a draw
against the Three-Year Incentive Award otherwise payable for the Three-Year
Periods beginning January 1, 1995 and/or January 1, 1996. The amount of such
draw shall be paid in cash and shall equal the target bonus amount under the
BPF portion of the prior plan. Such Participant's Three-Year Incentive
Award, if any, for the Three-Year Periods beginning in 1995 and/or in 1996
shall be reduced (but not below zero) by the amount of such draw.
(e) Transfers Between Units. If a Participant transfers employment from one
unit to another during a Three-Year Period, the Participant's Three-Year
Incentive Award shall be prorated based on the proportion of time spent in each
unit in which the Participant has spent at least six months.
7. TERMINATION OF EMPLOYMENT
(a) During Award Period. Subject to meeting the performance goals, a
Participant shall be entitled to receive payment of a Three-Year Incentive
Award only if employment with the FMC Companies continues uninterrupted from
the first day of participation in the Award to the earlier of (i) the last day
of the applicable period, (ii) normal retirement under the FMC Salaried
Employees' Retirement Plan or any successor plan, (iii) early retirement at the
request of FMC, (iv) death, or (v) Disability. Subject to meeting the
performance goals, earlier termination of employment will result in automatic
cancellation and forfeiture of the Award, provided that the Committee may, if
it believes circumstances warrant such action, authorize payment of all or a
portion of any Award that would otherwise be forfeited pursuant to this
section.
(b) During Restriction Period For Restricted Stock. Notwithstanding paragraph
(a) of this section, if a Participant receives Restricted Stock and employment
with the FMC Companies is terminated for any reason other than the reasons
contained in (ii), (iii), (iv) or (v) of paragraph (a) prior to the conclusion
of the three-year restriction period for such Restricted Stock, the Restricted
Stock shall be forfeited. If the
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Participant's employment with the FMC Companies is terminated for any of the
reasons contained in (ii), (iii), (iv) or (v) of paragraph (a) prior to the
conclusion of the three year restriction period for such Restricted Stock, the
Participant shall receive a number of shares equal to the sum of (i) five-
sixths of the number of shares of Restricted Stock payable under Section
7(c)(i)(B) and (ii) the product of (x) one-sixth of the number of shares of
Restricted Stock payable under Section 7(c)(i)(B) and (y) a fraction the
numerator of which is the number of days between the end of the applicable
Three-Year Period and the termination of employment and the denominator of
which is 1,095, and the balance of the stock portion of the Award shall be
forfeited.
8. INCENTIVE BENEFITS
In addition to Three-Year Incentive Awards, the Committee may, at its
discretion, create and grant such Incentive Benefits as it believes are
desirable (including by way of illustration and not by way of limitation, stock
appreciation rights, stock bonus and restricted stock awards), provided that:
(a) any Incentive Benefits shall be governed by the terms of the Plan as in
effect on the Date of Grant of such Incentive Benefits, and for such
purpose, notwithstanding the provisions of Section 15, the Committee may
amend the Plan to create and describe Incentive Benefits and the governing
terms thereof;
(b) the creation of Incentive Benefits may not, without stockholder
approval, (i) increase the total number of shares of Common Stock issuable
under the Plan, or (ii) materially modify the requirements as to eligibility
for participation in the Plan;
(c) the Committee shall not have the power to create and grant Incentive
Benefits that would result in the grant of a prohibited tandem stock option
or other prohibited tandem arrangement, with respect to any Incentive Stock
Options, as described in applicable regulations under Section 422 of the
Code, and
(d) with respect to grants and awards to persons subject to Section 16(b) of
the Exchange Act, Incentive Benefits granted or awarded shall have such
terms and conditions as will comply with Rule 16b-3 or other similar rules.
9. DILUTION AND OTHER ADJUSTMENTS
In the event of any change in the outstanding shares of Common Stock by reason
of any stock dividend or split, recapitalization, merger, consolidation,
spinoff, reorganization, combination or exchange of shares or other similar
corporate change, the Committee shall make such adjustments, if any, as it in
its sole discretion deems equitable (a) in the number of shares of Common Stock
that may be issued under the Plan in payment of any Award, or (b) in the
Financial Objectives during any Three Year Period from which the requisite
performance levels are calculated, such adjustments to be conclusive and
binding upon all parties concerned. The Committee may also make adjustments, to
the extent it deems appropriate, in a unit's performance goals during and after
any Three-Year Period to compensate for or reflect any significant changes that
may have occurred during such Three-Year Period in accounting practices, tax
laws or other laws or regulations which alter or affect the unit's performance,
actual economic conditions, such as inflation, when contrasted with the
assumptions underlying the unit's performance goals or changes resulting from
corporate restructuring including without limitation, acquisitions and
divestitures.
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10. CHANGE OF CONTROL
If, while any Awards remain outstanding under the Plan--
(a) the "beneficial ownership" (as defined in Rule 13d-3 under the Exchange
Act) of securities representing more than 20 percent of the combined voting
power of FMC is acquired by a "person" as defined in Sections 13(d) and
14(d) of the Exchange Act (other than FMC, any trustee or other fiduciary
holding securities under an employee benefit plan of FMC or an affiliate
thereof, or any corporation owned, directly or indirectly, by the
stockholders of FMC in substantially the same proportions as their ownership
of stock of FMC), or
(b) the stockholders of FMC approve a definitive agreement to merge or
consolidate FMC with or into another company (other than a merger or
consolidation which would result in the voting securities of FMC outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 80 percent of the combined voting power of the voting
securities of FMC or such surviving entity outstanding immediately after
such merger or consolidation), or to sell or otherwise dispose of all or
substantially all of its assets, or adopt a plan of liquidation, or
(c) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors any new director
(other than a director designated by a person who has entered into an
agreement with FMC to effect a transaction described in paragraph (a) or (b)
of this section) whose election by the Board of Directors or nomination for
election by FMC's stockholders was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority
thereof,
then from and after the date on which public announcement of the acquisition of
such percentage shall have been made, or the date of any such stockholder
approval or adoption, or the date on which the change in the composition of the
Board of Directors set forth above shall have occurred, whichever is
applicable, the full value of each outstanding Award shall become exercisable
and/or fully vested and shall be paid in full to the Participant as soon as
practicable following the date of such event.
11. CANCELLATION OF AWARDS
The Committee may cancel all or any part of an Award with the written consent
of the Participant holding such Award. In the event of any cancellation, all
rights of the former Participant in respect of such cancelled Award shall
terminate.
12. MISCELLANEOUS PROVISIONS
(a) Assignment and Transfer. Awards shall not be transferable other than by
will or the laws of descent and distribution and Awards may be exercised or
otherwise realized, during the lifetime of the grantee, only by the grantee or
by his or her guardian or legal representative.
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(b) No Right to Awards or Employment. No Employee or other person shall have
any claim or right to be granted an Award, nor shall any Participant have a
right to receive payment of an Award in any form other than as the Committee
shall approve. Neither the Plan nor any action taken hereunder shall be
construed as giving any Employee or Participant any right to be retained in the
employ of any FMC Company.
(c) Taxes. The FMC Companies shall have the right to deduct from payment of an
Award any taxes required by law to be withheld from an Employee with respect to
such payment and, in the case of Awards paid in Common Stock the Employee or
other person receiving such stock shall be required to pay to the FMC Companies
the amount of any taxes required to be withheld from an Employee with respect
to such stock.
(d) Securities Laws. Each Award shall be subject to the condition that such
Award may not be exercised or paid if the Committee determines that the sale of
securities upon exercise or payment of such Award may violate the Securities
Act of 1933 or any other law or requirement of any governmental authority. FMC
shall not be deemed by any reason of the granting of any Award to have any
obligation to register the shares subject to such Award under the Securities
Act of 1933 or to maintain in effect any registration of such shares which may
be made at any time under the Securities Act of 1933.
(e) Premature Termination. FMC shall not be obligated to make any payment of
cash or Common Stock (or have any other obligation or liability) under any
Award if the Committee shall determine that (i) the employment of the holder of
such Award with any FMC Company shall have been terminated for good cause, or
(ii) the holder of such Award shall have engaged or may engage in employment or
activities competitive with the FMC Companies or contrary, in the opinion of
the Committee, to the best interests of the FMC Companies. After any such
determination the holder of such Award shall have no right under any such Award
(regardless of whether such holder shall have delivered a notice of exercise
prior to the making of such determination) to receive any payment or purchase
any shares at any time unless such determination shall be rescinded by the
Committee. Any Award may be terminated entirely by the Committee at the time of
or any time subsequent to a determination by the Committee under this section
which has the effect of eliminating FMC's obligation to pay such Award or sell
or deliver shares under such Option.
(f) Severability. Whenever possible, each provision in the Plan and in every
Award shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Plan or any Award shall be held to
be prohibited by or invalid under applicable law then (i) such provision shall
be deemed amended to, and to have contained from the outset such language shall
be necessary to, accomplish the objectives of the provision as originally
written to the fullest extent permitted by law and (ii) all other provisions of
the Plan and every Award shall remain in full force and effect.
(g) No Strict Construction. No rule of strict construction shall be applied
against FMC, the Committee or any other person in the interpretation of any of
the terms of the Plan, any Award or any rule or procedure established by the
Committee.
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(h) Stockholder Rights. A Participant shall not have any dividend, voting or
other stockholder rights by reason of an Award prior to the issuance of any
Common Stock pursuant to such Award.
(i) Governing Law. The Plan shall be governed by and construed in accordance
with the laws of the United States of America and, to the extent not
inconsistent therewith, by the laws of the State of Illinois.
13. AMENDMENT AND TERMINATION
(a) Amendment. The Board of Directors may at any time amend, suspend or
terminate the Plan, provided that no such action shall adversely affect any
rights under any Award theretofore granted or change the objectives or other
measure of performance applicable to an Award in a manner adverse to
Participants in accordance with Section 9. No amendment may, without
stockholder approval in accordance with Section 14, increase the total number
of shares of Common Stock issuable under the Plan.
(b) Termination. The right to grant further Awards shall terminate
automatically upon the granting of such Awards which, together with shares of
Common Stock previously issued and/or subject to outstanding Awards, equals the
maximum authorized under the Plan, subject to additional shares of Common Stock
becoming available for Awards by reason of forfeitures or cancellations of
earlier Awards.
14. EFFECTIVE DATE OF THE PLAN
The Plan shall become effective as of January 1, 1995, subject to approval by
the affirmative vote of the holders of a majority of the securities of FMC
present, or represented, and entitled to vote at the next annual meeting of the
stockholders of FMC.
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EXHIBIT B
FMC 1995 STOCK OPTION PLAN
1. PURPOSE OF THE PLAN
The purpose of the FMC 1995 Stock Option Plan is to promote the long-term
performance of FMC by (i) providing long-term incentives in common stock of FMC
to key management employees of FMC and its subsidiaries, (ii) assisting in
attracting and retaining as employees persons whose abilities, experience and
judgment have contributed and will continue to contribute to the financial
success and progress of FMC, and (iii) aligning the identity of interests of
those employees and FMC's shareholders.
2. DEFINITIONS
(a) "Award" means an Option.
(b) "Board of Directors" means the Board of Directors of FMC as it may be
constituted from time to time.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the Compensation and Organization Committee of the Board
of Directors.
(e) "Common Stock" means the common stock of FMC.
(f) "Date of Grant" means the date which is designated by the Committee as the
date of grant of an Option.
(g) "Disability" means complete and permanent inability by reason of illness or
accident to perform the duties of the occupation at which a Participant was
employed when such disability commenced.
(h) "Disinterested Person" means any member of the Board of Directors who, at
the time discretion under the Plan is exercised, has not at any time within one
year prior thereto received grants or awards of equity securities under the
Plan or any other plan of FMC or any of its affiliates (as that term is used in
the Exchange Act) except as provided in Rule 16b-3(c)(2)(i), and is not
selected as a person to whom equity securities may be allocated or granted
pursuant to any other plan of FMC or any of its affiliates (as that term is
used in the Exchange Act) entitling the participants therein to acquire equity
securities of FMC or of any such affiliates except as provided in Rule 16b-
3(c)(2)(i).
(i) "Employee" means any person employed by the FMC Companies.
(j) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(k) "Fair Market Value" means the closing price of a share of Common Stock on a
specified date as reported in the New York Stock Exchange Composite
Transactions for such date, or such other measurement of value as may be
specified by the Committee from time to time.
(l) "FMC" means FMC Corporation.
(m) "FMC Company" or "FMC Companies" means FMC and its Subsidiaries.
B-1
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(n) "Incentive Stock Option" means a stock option granted by the Committee to a
Participant which is an incentive stock option within the meaning of Section
422 of the Code and is designated by the Committee as an Incentive Stock
Option.
(o) "Nonqualified Stock Option" means a stock option granted by the Committee
to a Participant which is not designated by the Committee as an Incentive Stock
Option.
(p) "Option" means an Incentive Stock Option or a Nonqualified Stock Option.
(q) "Parent Corporation" means a corporation which, with respect to another
corporation, is a parent corporation within the meaning of Section 424(e) of
the Code.
(r) "Participant" means an Employee who has received an Award which has not
been exercised, cancelled or forfeited and which has not expired.
(s) "Plan" means the FMC 1995 Stock Option Plan.
(t) "Plan Year" means each calendar year commencing on or after January 1,
1995.
(u) "Subsidiary Company" means (i) any corporation the majority of the voting
power of all classes of stock entitled to vote or the majority of the total
value of shares of all classes of stock of which is owned, directly or
indirectly, by FMC, or (ii) any trade or business other than a corporation the
majority of the profits interest, capital interest or actuarial interest of
which is owned, directly or indirectly, by FMC.
(v) "Subsidiary Corporation" means a corporation or other entity which, with
respect to another corporation, is a subsidiary corporation within the meaning
of Section 424(f) of the Code.
(w) "10 Percent Shareholder" means an individual who on the Date of Grant owns
directly or indirectly stock of the FMC Company employing such individual, or
of a corporation which is a Parent Corporation or Subsidiary Corporation with
respect to such FMC Company, possessing more than 10 percent of the total
combined voting power of all classes of stock of such FMC Company, Parent
Corporation, or Subsidiary Corporation.
3. ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Committee, the composition of which shall
consist of not less than two members of the Board of Directors who are
Disinterested Persons, and otherwise satisfy the provisions of Rule 16b-3 of
the General Rules and Regulations under the Exchange Act or any successor to
such rule . Except as limited by the express provisions of the Plan or by
resolutions adopted by the Board of Directors, the Committee shall have the
authority and discretion to interpret the Plan, to establish and revise rules
and regulations relating to the Plan, and to make any other determinations that
it believes necessary or advisable for the administration of the Plan.
Decisions and determinations by the Committee shall be final and binding on all
persons. Notwithstanding anything to the contrary
B-2
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contained in the Plan, the Board of Directors shall also have all power and
authority to perform any act granted to the Committee pursuant to the Plan.
4. PARTICIPATION
Participants shall be determined by the Committee, in its sole discretion, from
Employees who, in the Committee's judgment, have a significant opportunity to
influence the growth of FMC or whose outstanding performance or potential merit
further incentive and reward for continued employment and accomplishment.
5. SHARES OF COMMON STOCK SUBJECT TO THE PLAN
Subject to adjustment pursuant to Section 7, at no time may (i) the sum of (a)
the number of shares of Common Stock issued upon exercise of Options, and (b)
the number of shares of Common Stock subject to outstanding Options, together
with all shares issued or subject to outstanding awards under the FMC 1995
Management Incentive Plan exceed 3.0 million or (ii) the number of shares of
Common Stock for which Options may be granted during a Plan Year exceed 100,000
for any Participant. In the event that any outstanding Option for any reason
expires, terminates, is cancelled or forfeited, without having been exercised,
the shares of Common Stock allocable to the expired, terminated, cancelled or
forfeited portion of such Option shall (unless the Plan shall have been
terminated) become available for subsequent grants of Options.
6. OPTIONS
(a) Grant of Options. The Committee may, in its sole discretion, at any time
and from time to time grant Options to any Participant. Each Option shall be
evidenced by a written instrument containing such terms and conditions, not
inconsistent with the Plan, as the Committee shall approve.
(b) Nonqualified Stock Options
(i) Exercise Price. The purchase price per share of Common Stock under each
Nonqualified Stock Option shall be as specified by the Committee in the
Option, provided that such purchase price shall be not less than 100 percent
of the Fair Market Value on the Date of Grant.
(ii) Exercisability. Each Nonqualified Stock Option shall become fully
exercisable by the grantee at the time designated by the Committee in the
Option.
(iii) Term. The term of each Nonqualified Stock Option shall be as specified
by the Committee in the Option. In the event no term is so specified, the
term for the Nonqualified Stock Option shall be 15 years from the Date of
Grant. The Committee may, from time to time, extend the Option Expiration
Date of any Nonqualified Stock Option upon such terms and conditions as the
Committee shall determine.
(iv) No Ordering. Nonqualified Stock Options may be exercised in any order,
regardless of the Date of Grant or the existence of any outstanding Option.
B-3
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(c) Incentive Stock Options
(i) Date of Grant. In no event shall any Incentive Stock Option be granted
after ten years from the date the Plan is adopted or the date the Plan is
approved by the stockholders of FMC pursuant to Section 16, whichever is
earlier.
(ii) Exercise Price. The purchase price per share of Common Stock under each
Incentive Stock Option shall be not less than 100 percent of the Fair Market
Value on the Date of Grant.
Notwithstanding the foregoing, in the case of a Ten Percent Shareholder, the
purchase price per share of Common Stock under each such Incentive Stock
Option shall be not less than 110 percent of the Fair Market Value on the
Date of Grant.
(iii) Exercisability. Each Incentive Stock Option shall become fully
exercisable by the grantee at the time designated by the Committee in the
Option.
(iv) Term. At or prior to the time an Incentive Stock Option is granted, the
Committee shall fix the term of such Option, which shall be not more than
ten years from the Date of Grant, and such term shall be stated in the
Option. In the event the Committee takes no action to fix the term, such
Option shall contain a provision that it shall expire 10 years from the Date
of Grant.
Notwithstanding the foregoing, the terms of an Option granted to a 10
Percent Shareholder shall not be more than five years from the Date of
Grant.
(v) Maximum Amount. The aggregate Fair Market Value (determined as of the
date the Incentive Stock Option is granted) of the shares of Common Stock
with respect to which the Incentive Stock Options granted under the Plan and
all other FMC plans become exercisable for the first time by a Participant
during any calendar year shall not exceed $100,000. Options granted in
excess of such limitation shall be Nonqualified Options.
(vi) Notice of Disposition. A Participant or former Participant shall give
prompt notice to FMC of any disposition of shares acquired upon exercise of
an Incentive Stock Option if such disposition occurs within either two years
after the Date of Grant or one year after the receipt of such shares by the
Participant or former Participant.
(d) Exchange of Options. The Committee may, in its discretion, grant to the
holder of an Option, pursuant to the Plan and subsequent to the voluntary
surrender and the cancellation of such Option, one or more new Options having
different Option prices than the Option price provided in the Option so
surrendered and cancelled.
(e) Payment for Stock. Payment for Common Stock purchased upon the exercise (in
whole or in part) of an Option shall be made in cash, in shares of Common Stock
(valued at the then Fair Market Value), or by a combination of cash and Common
Stock. The proceeds received by FMC from the sale or sales pursuant to the Plan
will be used for general corporate purposes.
(f) Termination of Employment.
(i) Nonqualified Stock Options. If a Participant's employment is terminated
for any reason whatsoever (including death), any Nonqualified Stock Option
granted pursuant to the Plan
B-4
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outstanding at the time and all rights thereunder may, unless earlier
terminated in accordance with its terms, be exercised by the Participant or
other person who acquired the right to exercise such Option, until the
following date:
(A) The Option Expiration Date if termination is due to death, Disability
or retirement under the terms of any formal retirement plan of any FMC
Company;
(B) three months after the date employment is terminated for any reason
other than death, Disability, retirement or good cause as provided in
Section 10(e); or
(C) immediately upon the date employment is terminated for good cause as
provided in Section 14(e).
(ii) Incentive Stock Options. If a Participant's employment terminates for
any reason (including death) such that the Participant is not employed by
FMC or by any corporation which is a Parent Corporation or Subsidiary
Corporation with respect to FMC, any Incentive Stock Option outstanding at
the time and all rights thereunder may, unless earlier terminated in
accordance with its terms, be exercised by the Participant or other person
who acquired the right to exercise such option until the following date:
(A) the Option Exercise Date if termination is due to death;
(B) one year after the date employment terminates if such termination is
by reason of permanent and total disability;
(C) three months after the date employment terminates for any reason
other than death or permanent and total disability or good cause as
provided in Section 14(e), provided that if employment terminates due to
retirement at the normal retirement date or to early retirement at the
request of FMC, the Option shall terminate at the Option Expiration Date
subject to its becoming a Nonqualified Stock Option if not exercised
within three months of such termination of employment;
(D) immediately upon the date employment is terminated for good cause as
provided in Section 14(e),
but in all events each Incentive Stock Option shall terminate not more than
10 years (five years in the case of an Incentive Stock Option granted to a
10 Percent Shareholder) from the Date of Grant. For purposes of this
section, "permanent and total disability" means the inability to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or
which has lasted or can be expected to last for a continuous period of not
less than 12 months.
(iii) Whole or Partial Exercise. If an Option may be exercised by a
Participant after his employment terminates, such Option may be exercised in
whole or in part.
(iv) Beneficiaries. In the event of the death of a Participant, the person
or persons to whom any Option shall have been transferred by will or the
laws of descent and distribution shall have the right (during the
appropriate period determined under this section) to exercise such Option in
whole or in part.
B-5
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(v) Committee Discretion. Notwithstanding the foregoing, the Committee may,
if it believes circumstances warrant such action, authorize the exercise of
an Option that would otherwise have terminated provided that the Committee
may not exercise such discretion if it would cause the disallowance of FMC's
tax deduction under Section 162(m) of the Code with respect to the Plan or
an Award.
7. DILUTION AND OTHER ADJUSTMENTS
In the event of any change in the outstanding shares of Common Stock by reason
of any stock dividend or split, recapitalization, merger, consolidation,
spinoff, reorganization, combination or exchange of shares or other similar
corporate change, the Committee shall make such adjustments, if any, as it in
its sole discretion deems equitable in the number of shares of Common Stock
subject to an Option held by any Participant and the exercise price thereof,
such adjustments to be conclusive and binding upon all parties concerned.
8. CHANGE OF CONTROL
If, while any Options remain outstanding under the Plan--
(a) the "beneficial ownership" (as defined in Rule 13d-3 under the Exchange
Act) of securities representing more than 20 percent of the combined voting
power of FMC is acquired by a "person" as defined in Sections 13(d) and
14(d) of the Exchange Act (other than FMC, any trustee or other fiduciary
holding securities under an employee benefit plan of FMC or an affiliate
thereof, or any corporation owned, directly or indirectly, by the
stockholders of FMC in substantially the same proportions as their ownership
of stock of FMC), or
(b) the stockholders of FMC approve a definitive agreement to merge or
consolidate FMC with or into another company (other than a merger or
consolidation which would result in the voting securities of FMC outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 80 percent of the combined voting power of the voting
securities of FMC or such surviving entity outstanding immediately after
such merger or consolidation), or to sell or otherwise dispose of all or
substantially all of its assets, or adopt a plan of liquidation, or
(c) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors any new director
(other than a director designated by a person who has entered into an
agreement with FMC to effect a transaction described in paragraph (a) or (b)
of this section) whose election by the Board of Directors or nomination for
election by FMC's stockholders was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority
thereof,
then from and after the date on which public announcement of the acquisition of
such percentage shall have been made, or the date of any such stockholder
approval or adoption, or the date on which the change in the composition of the
Board of Directors set forth above shall have occurred, whichever is
applicable, all Options shall become exercisable on the date of such event.
B-6
<PAGE>
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9. CANCELLATION OF AWARDS
The Committee may cancel all or any part of an Option with the written consent
of the Participant holding such Option. In the event of any cancellation, all
rights of the former Participant in respect of such cancelled Option shall
terminate.
10. MISCELLANEOUS PROVISIONS
(a) Assignment and Transfer. Options shall not be transferable other than by
will or the laws of descent and distribution and may be exercised or otherwise
realized, during the lifetime of the grantee, only by the grantee or by his or
her guardian or legal representative.
(b) No Right to Options or Employment. No Employee or other person shall have
any claim or right to be granted an Option. Neither the Plan nor any action
taken hereunder shall be construed as giving any Employee or Participant any
right to be retained in the employ of any FMC Company.
(c) Taxes. The FMC Companies shall have the right to deduct from payment of an
Award any taxes required by law to be withheld from an Employee with respect to
such payment and, in the case of shares of Common Stock issued upon the
exercise of an Option, the Employee or other person receiving such stock shall
be required to pay to the FMC Companies the amount of any taxes required to be
withheld from an Employee with respect to such stock.
(d) Securities Laws. Each Option shall be subject to the condition that such
Option may not be exercised if the Committee determines that the sale of
securities upon exercise of such Option may violate the Securities Act of 1933
or any other law or requirement of any governmental authority. FMC shall not be
deemed by any reason of the granting of any Option to have any obligation to
register the shares subject to such Option under the Securities Act of 1933 or
to maintain in effect any registration of such shares which may be made at any
time under the Securities Act of 1933.
(e) Premature Termination. FMC shall not be obligated to make any payment of
cash or Common Stock (or have any other obligation or liability) under any
Option if the Committee shall determine that (i) the employment of the holder
of such Option with any FMC Company shall have been terminated for good cause,
or (ii) the holder of such Option shall have engaged or may engage in
employment or activities competitive with the FMC Companies or contrary, in the
opinion of the Committee, to the best interests of the FMC Companies. After any
such determination the holder of such Option shall have no right under any such
Option (regardless of whether such holder shall have delivered a notice of
exercise prior to the making of such determination) to receive any payment or
purchase any shares at any time unless such determination shall be rescinded by
the Committee. Any Option may be terminated entirely by the Committee at the
time of or any time subsequent to a determination by the Committee under this
section which has the effect of eliminating FMC's obligation to pay such Award
or sell or deliver shares under such Option.
B-7
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(f) Severability. Whenever possible, each provision in the Plan and in every
Option shall be interpreted in such manner as to be effective and valid under
applicable law (including, in the case of an Incentive Stock Option,
interpretation in such manner as to not prevent such Option from meeting the
requirements of Section 422 of the Code and of other provisions applicable with
respect to incentive stock options as defined in such Section 422
(collectively, the "ISO Requirements"), but if any provision of this Plan or
any Option shall be held to be prohibited by or invalid under applicable law,
or, where applicable, to fail to meet any ISO Requirements, then (i) such
provision shall be deemed amended to, and to have contained from the outset
such language shall be necessary to, accomplish the objectives of the provision
as originally written to the fullest extent permitted by law and (ii) all other
provisions of the Plan and every Option shall remain in full force and effect.
(g) No Strict Construction. No rule of strict construction shall be applied
against FMC, the Committee or any other person in the interpretation of any of
the terms of the Plan, any Option or any rule or procedure established by the
Committee.
(h) Stockholder Rights. A Participant shall not have any dividend, voting or
other stockholder rights by reason of an Option prior to the issuance of any
Common Stock pursuant to such Option.
(i) Governing Law. The Plan shall be governed by and construed in accordance
with the laws of the United States of America and, to the extent not
inconsistent therewith, by the laws of the State of Illinois.
11. AMENDMENT AND TERMINATION
(a) Amendment. The Board of Directors may at any time amend, suspend or
terminate the Plan, provided that no such action shall adversely affect any
rights under any Option theretofore granted or change the objectives or other
measure of performance applicable to an Option in a manner adverse to
Participants in accordance with Section 7. No amendment may, without
stockholder approval in accordance with this Section, increase the total number
of shares of Common Stock issuable under the Plan.
(b) Termination. The right to grant further Options shall terminate
automatically upon the granting of such Options which, together with shares of
Common Stock previously issued and/or subject to outstanding Options, equals
the maximum authorized under the Plan, subject to additional shares of Common
Stock becoming available for Options by reason of forfeitures or cancellations
of earlier Options or Awards under the Plan or the FMC 1995 Management
Incentive Plan.
12. EFFECTIVE DATE OF THE PLAN
The Plan shall become effective as of January 1, 1995, subject to approval by
the affirmative vote of the holders of a majority of the securities of FMC
present, or represented, and entitled to vote at the next annual meeting of the
stockholders of FMC.
B-8
<PAGE>
LOGO LOGO
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FMC Corporation
200 East Randolph Drive
Chicago, IL 60601
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
APRIL 21, 1995
AND PROXY STATEMENT
FMC CORPORATION
<PAGE>
GRAPHICS APPENDIX LIST
PHOTOS OF THE DIRECTORS AND NOMINEES FOR DIRECTORS APPEAR TO THE LEFT
OF EACH RESPECTIVE NAME ON PAGES 2,3,4,5,6,7 AND 8.
THE GRAPHS ON PAGES 24 AND 25 REPRESENT THE COMPARISONS OF THE FIVE AND TEN
YEAR CUMULATIVE TOTAL STOCKHOLDER RETURN FOR FMC, S&P 500 INDEX AND DOW JONES
DIVERSIFIED INDUSTRIALS INDEX.
<PAGE>
PROXY FMC CORPORATION LOGO
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Robert N. Burt, Michael J. Callahan and Robert
L. Day, and each of them, proxy for the undersigned, with full power of
substitution, to vote in the manner indicated on the reverse side, and with
discretionary authority as to any other matters that may properly come before
the meeting, all shares of common stock of FMC Corporation which the
undersigned is entitled to vote at the annual meeting of stockholders of FMC
Corporation to be held on April 21, 1995, at 200 East Randolph Drive, Chicago,
Illinois at 2:00 P.M. or any adjournment thereof.
NOT VALID UNLESS DATED AND SIGNED ON REVERSE SIDE
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1, 2, 3 AND 4.
<PAGE>
FMC CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]
1. ELECTION OF FOUR DIRECTORS TO SERVE IN CLASS III FOR A TERM EXPIRING IN 1998
AS SET FORTH IN THE PROXY STATEMENT--
FOR [_] WITHHELD [_] FOR ALL EXCEPT [_]
Nominees: B. A. Bridgewater, Jr., P. L. Davies, Jr.,
W. F. Reilly and J. R. Thompson. (Except nominee(s) written below).
- ----------------------------------------------------------------------
2. Ratification of the Appointment of Independent Auditors.
FOR [_] AGAINST [_] ABSTAIN [_]
3. Approval of FMC 1995 Management Incentive Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
4. Approval of FMC 1995 Stock Option Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3 AND 4.
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Dated: ________________________________________________________ , 1995
Signature(s)____________________________________________________________________
- --------------------------------------------------------------------------------
Please sign exactly as name appears at left. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
<PAGE>
PROXY FMC CORPORATION
LOGO
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
PRUDENTIAL TRUST COMPANY, Trustee
You are instructed to vote in the manner indicated on the reverse side, and
with discretionary authority as to any other matters that may come before the
meeting, all shares of stock represented by my interest in the Stock Fund of
the FMC Corporation 401(k) Plan for Employees Covered by a Collective
Bargaining Agreement at the annual meeting of stockholders of FMC Corporation
to be held on April 21, 1995, at 200 East Randolph Drive, Chicago, Illinois at
2:00 P.M. or any adjournment or postponement thereof, as follows.
NOT VALID UNLESS DATED AND SIGNED ON REVERSE SIDE
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1, 2, 3 AND 4.
<PAGE>
FMC CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]
1. ELECTION OF FOUR DIRECTORS TO SERVE IN CLASS III FOR A TERM EXPIRING IN 1998
AS SET FORTH IN THE PROXY STATEMENT--
FOR [_] WITHHELD [_] FOR ALL EXCEPT [_]
Nominees: B. A. Bridgewater, Jr., P. L. Davies, Jr.,
W. F. Reilly and J. R. Thompson. (Except nominee(s) written below).
- ----------------------------------------------------------------------
2. Ratification of the Appointment of Independent Auditors.
FOR [_] AGAINST [_] ABSTAIN [_]
3. Approval of FMC 1995 Management Incentive Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
4. Approval of FMC 1995 Stock Option Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3 AND 4.
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Dated: ________________________________________________________ , 1995
Signature: ____________________________________________________________________
Please sign exactly as name appears at left.
<PAGE>
PROXY FMC CORPORATION
LOGO
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
HARRIS TRUST and SAVINGS BANK, Trustee
You are instructed to vote in the manner indicated on the reverse side, and
with discretionary authority as to any other matters that may properly come
before the meeting, all shares of stock represented by my interest in the
Stock Fund of the FMC Employees' Thrift and Stock Purchase Plan at the annual
meeting of stockholders of FMC Corporation to be held on April 21, 1995, at
200 East Randolph Drive, Chicago, Illinois at 2:00 P.M. or any adjournment or
postponement thereof, as follows.
NOT VALID UNLESS DATED AND SIGNED ON THE REVERSE SIDE
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. UNLESS OTHERWISE INSTRUCTED PRIOR TO APRIL 19,
1995, THE TRUSTEE WILL VOTE YOUR SHARES FOR PROPOSALS 1, 2, 3 AND 4.
<PAGE>
FMC CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]
1. ELECTION OF FOUR DIRECTORS TO SERVE IN CLASS III FOR A TERM EXPIRING IN 1998
AS SET FORTH IN THE PROXY STATEMENT--
FOR [_] WITHHELD [_] FOR ALL EXCEPT [_]
Nominees: B. A. Bridgewater, Jr., P. L. Davies, Jr.,
W. F. Reilly and J. R. Thompson. (Except nominee(s) written below).
- ----------------------------------------------------------------------
2. Ratification of the Appointment of Independent Auditors.
FOR [_] AGAINST [_] ABSTAIN [_]
3. Approval of FMC 1995 Management Incentive Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
4. Approval of FMC 1995 Stock Option Plan.
FOR [_] AGAINST [_] ABSTAIN [_]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3 AND 4.
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Dated: ________________________________________________________ , 1995
Signature: ____________________________________________________________________
Please sign exactly as name appears at left.
