GLATFELTER P H CO, DEF 14A, 1994-03-17

GLATFELTER P H CO
DEF 14A, 1994-03-17
PAPER MILLS

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<PAGE> 1

SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the registrant /x/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
P. H. GLATFELTER COMPANY
(Name of Registrant as Specified in Its Charter)
P. H. GLATFELTER COMPANY
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.

(1) Title of each class of securities to which transaction applies:

- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)

- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

- --------------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.

(1) Amount previously paid:

- --------------------------------------------------------------------------------

(2) Form, schedule or registration statement no.:

- --------------------------------------------------------------------------------
(3) Filing party:

- --------------------------------------------------------------------------------
(4) Date filed:

- --------------------------------------------------------------------------------
- ---------------
(1)Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE> 2

P. H. GLATFELTER COMPANY
228 S. MAIN STREET
SPRING GROVE, PENNSYLVANIA 17362

---------------------

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

APRIL 27, 1994

---------------------

TO THE COMMON SHAREHOLDERS:

The annual meeting of shareholders of P. H. Glatfelter Company will be held
at the Company's principal office, 228 S. Main Street, Spring Grove,
Pennsylvania, on Wednesday, April 27, 1994 at 10:00 A.M. for the following
purposes:

1. To elect four members of the Board of Directors, each to serve for
full three-year terms expiring in 1997.

2. To transact such other business as may properly come before the
meeting.

The Board of Directors has fixed March 2, 1994 as the record date for
determining the holders of Common Stock entitled to notice of and to vote at the
meeting. Consequently, only holders of Common Stock of record on the transfer
books of the Company at the close of business on March 2, 1994 will be entitled
to notice of and to vote at the meeting.

Please complete, date and sign the enclosed proxy and return it promptly.
If you attend the meeting, you may vote in person.

R. S. WOOD,
Secretary

March 17, 1994
<PAGE> 3

P. H. GLATFELTER COMPANY

PROXY STATEMENT

INTRODUCTION

The accompanying proxy is solicited by the Board of Directors of P. H.
Glatfelter Company, 228 S. Main Street, Spring Grove, Pennsylvania 17362. Copies
of this proxy statement and the accompanying proxy are being mailed to the
holders of Common Stock on or after March 17, 1994. The proxy may be revoked by
a shareholder at any time prior to its use by giving written notice of such
revocation to the Secretary of the Company, by appearing at the meeting and
voting in person or by the timely submission of a properly executed later dated
proxy. The expense of this solicitation will be paid by the Company. Some of the
officers and other employees of the Company may solicit proxies personally and
by telephone.

Holders of Common Stock of record at the close of business on March 2, 1994
will be entitled to one vote per share so held of record on all business of the
meeting, except that the holders have cumulative voting rights in elections of
directors. Therefore, each shareholder is entitled to as many votes in the
election of directors of each class as shall equal the number of his shares of
Common Stock multiplied by the number of directors of such class to be elected.
A shareholder may cast all such votes for a single nominee or may distribute
them between two or more nominees within such class as he sees fit. The Company
had 43,987,328 shares of Common Stock outstanding on the record date. The
presence at the meeting in person or by proxy of the holders of a majority of
the shares of Common Stock outstanding on the record date will constitute a
quorum at the meeting. Votes withheld and abstentions will be counted in
determining the presence of a quorum, but will not be voted. Broker non-votes
will not be counted in determining the presence of a quorum and will not be
voted. The votes will be counted by judges of election appointed by the Company.

ELECTION OF DIRECTORS

Four directors are to be elected at the annual meeting of shareholders to
serve three-year terms expiring on the date of the 1997 annual meeting of
shareholders and until their respective successors are elected and shall
qualify. The persons named in the accompanying proxy intend to vote for the
election of R. E. Chappell, G. H. Glatfelter II, T. C. Norris and R. L. Smoot
for terms expiring in 1997, unless authority to vote for one or more of such
nominees is specifically withheld in the proxy. Messrs. Chappell, Glatfelter,
Norris and Smoot are currently directors of the Company. The persons named in
the proxy will have the right to vote cumulatively and to distribute their votes
among the nominees as they consider advisable. The four nominees for director
receiving the highest number of votes cast by shareholders entitled to vote
thereon will be elected to serve on the Board of Directors. The Board of
Directors is informed that all the nominees are willing to serve as directors,
but if any of them should decline to serve or become unavailable for election as
a director at the meeting, an event which the Board of Directors does not
anticipate, the persons named in the proxy will vote for such nominee or
nominees as may be designated by the Board of Directors unless the Board of
Directors reduces the number of directors accordingly.
<PAGE> 4

The following table sets forth information as to the nominees and the other
persons who are to continue as directors of the Company after the annual
meeting. The offices referred to in the table are offices of the Company unless
otherwise indicated. For information concerning the number of shares of the
Company owned by each director and all directors and officers as a group as of
March 2, 1994, see "Ownership of Common Stock."

<TABLE>
<CAPTION>
YEAR FIRST PRINCIPAL OCCUPATION AND
ELECTED A BUSINESSES DURING LAST FIVE
NAME AGE DIRECTOR YEARS AND CURRENT DIRECTORSHIPS
- --------------------------- --- ---------- -----------------------------------------------
<S> <C> <C> <C>
Nominees to be elected for terms expiring in 1997:
Robert E. Chappell 49 1989 President, Penn Mutual Life Insurance Company
since January 10, 1994; Executive Vice
President, PNC Bank Corp., a bank holding
company, from January 1992 to December 1993;
Chairman, Provident National Bank, a subsidiary
of PNC Bank Corp., from June 30, 1988 to
January 28, 1993; Vice Chairman, PNC Financial
Corp from August 1988 to December 1991;
President, Provident National Bank prior to
April 1991
George H. Glatfelter II(1) 42 1992 Vice President--General Manager, Glatfelter
Paper Division since May 1993; General Manager,
Glatfelter Paper Division from April 1989 to
May 1993; Assistant to Chief Executive Officer
from April 1988 to April 1989
Thomas C. Norris 55 1976 Chairman, President and Chief Executive Officer
Richard L. Smoot 53 1994 President and Chief Executive Officer, PNC
Bank, National Association since May 1991;
Executive Vice President, Provident National
Bank, from March 1987 to May 1991
Directors continuing for terms expiring in 1996:
Garza Baldwin, Jr. 73 1987 Retired; former President--Ecusta Division
George H. Glatfelter(1) 67 1970 Retired; former Vice President--Manufacturing,
Spring Grove Mill
M. A. Johnson II 60 1970 Retired; former Executive Vice President,
Treasurer and Chief Financial Officer
John W. Kennedy 73 1978 Chairman, McClarin Plastics, manufacturer of
plastic industrial products
Directors continuing for terms expiring in 1995:
P. H. Glatfelter III(1) 78 1944 Chairman Emeritus since 1988; Chairman of the
Board prior thereto
Roger S. Hillas 66 1964 Retired; Chairman and Chief Executive Officer,
Meritor Savings Bank, from July 1, 1988 to
December 11, 1992; Director of Consolidated
Rail Corporation, Toll Bros., Inc., VF
Corporation and The Bon-Ton Stores, Inc.
</TABLE>

2
<PAGE> 5

- ---------------

(1) P. H. Glatfelter III and George H. Glatfelter are brothers. George H.
Glatfelter II is the son of George H. Glatfelter.

INFORMATION ABOUT THE BOARD OF DIRECTORS
AND ITS COMMITTEES

BOARD OF DIRECTORS

The Board of Directors held five meetings during 1993. Each of the
incumbent directors attended at least 75% of the aggregate of all meetings of
the Board of Directors and committees thereof on which he served in 1993. The
standing committees of the Board are the Executive Committee, the Audit
Committee, the Compensation Committee, the Finance Committee, the Nominating
Committee, the Pension Committee and the Profit Sharing and Employee Stock
Ownership Committee. The members of all of these committees are appointed by the
Board.

COMMITTEES

Executive Committee -- The Executive Committee consists of six members of
the Board: G. H. Glatfelter, P. H. Glatfelter III, R. S. Hillas, M. A. Johnson
II, J. W. Kennedy and T. C. Norris. The Executive Committee has the authority to
exercise all of the powers of the Board of Directors between meetings of the
Board except the power to amend the Company's By-Laws and the power to rescind
or modify any prior action of the Board of Directors. The Executive Committee
held no meetings during 1993.

Audit Committee -- The Audit Committee consists of four members of the
Board: G. Baldwin, Jr., R. E. Chappell, J. W. Kennedy and R. S. Hillas, none of
whom are members of the Company's management. Generally, the Audit Committee (i)
recommends to the Board of Directors the independent accountants to be appointed
for the Company, (ii) meets with the independent accountants, the chief internal
auditor and other corporate officers to review matters relating to corporate
financial reporting and accounting procedures and policies, adequacy of
financial, accounting and operating controls and the scope of the audits of the
independent accountants and internal auditors, including in the case of
independent accountants, the fees for such services and (iii) reviews and
reports on the results of such audits to the Board of Directors. The Audit
Committee held two meetings during 1993.

3
<PAGE> 6

In accordance with the recommendations of the Audit Committee, the Board of
Directors has selected Deloitte & Touche, independent certified public
accountants, to audit the consolidated financial statements of the Company and
its consolidated subsidiaries for the year ending December 31, 1994. A
representative of Deloitte & Touche is expected to attend the shareholders'
meeting and will be given the opportunity to make a statement if he or she
desires to do so and will be available to respond to appropriate questions.

Compensation Committee -- The Compensation Committee consists of four
members of the Board: P. H. Glatfelter III, R. S. Hillas, J. W. Kennedy and
P. R. Roedel. The responsibilities of the Compensation Committee are described
below (see "Report of Compensation Committee on Executive Compensation"). The
Compensation Committee held four meetings during 1993.

Finance Committee -- The Finance Committee consists of six members of the
Board: R. E. Chappell, G. H. Glatfelter II, P. H. Glatfelter III, M. A. Johnson
II, T. C. Norris and J. M. Sanzo. The Finance Committee is responsible for
overseeing the Company's financial affairs and recommending such financial
actions and policies, including those with respect to dividends, as are most
appropriate to accommodate the Company's strategic and operating strategies
while maintaining its sound financial condition. The Finance Committee held two
meetings during 1993.

Nominating Committee -- The Nominating Committee consists of four members
of the Board: P. H. Glatfelter III, R. S. Hillas, T. C. Norris and J. M. Sanzo.
The responsibilities of the Nominating Committee include the identification and
recruitment of effective candidates for nomination to the Board as directors and
officers of the Company. The Nominating Committee held two meetings during 1993.
The Nominating Committee will consider nominees for election to the Board
recommended by the holders of Common Stock of the Company. Any shareholder
desiring to recommend a nominee for election at the 1995 annual meeting of
shareholders should submit such nomination in writing to the Secretary of the
Company by November 17, 1994.

Pension Committee -- The Pension Committee consists of two members of the
Board, M. A. Johnson II and T. C. Norris, and four officers or employees of the
Company, D. H. Landis, R. P. Newcomer, R. W. Wand and R. S. Wood. The
responsibilities of the Pension Committee include the general overview of the
provisions of various pension plans of the Company and an annual review of
pension fund performance. The Pension Committee held five meetings during 1993.

Profit Sharing and Employee Stock Ownership Committee -- The Profit Sharing
and Employee Stock Ownership Committee consists of two members of the Board,
T. C. Norris and M. A. Johnson II, and three officers of the Company, R. P.
Newcomer, R. W. Wand and R. S. Wood. The responsibilities of the Committee are
to administer the Company's various profit sharing and stock ownership plans and
to conduct an annual review of profit sharing fund performance. The Committee
held two meetings during 1993.

COMPENSATION OF DIRECTORS

Board members, who are not otherwise salaried employees of the Company,
receive an annual retainer of $12,000.

4
<PAGE> 7

EXECUTIVE COMPENSATION

The following table sets forth certain information concerning compensation
from the Company and its subsidiaries which was awarded to, earned by, or paid
to the Company's Chief Executive Officer and each of the Company's five other
most highly compensated executive officers, based on salary and bonus earned
during 1993, including M. A. Johnson II, an executive officer who retired on
August 1, 1993:

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------------
AWARDS
------------------------ PAYOUTS
NAME AND ANNUAL COMPENSATION RESTRICTED SECURITIES ----------
PRINCIPAL FISCAL ---------------------- STOCK UNDERLYING LTIP ALL OTHER
POSITION YEAR SALARY($) BONUS($)(1) AWARDS($)(2) OPTIONS(2) PAYOUTS($) COMPENSATION($)(3)
- ------------------------------- ------ --------- ----------- ------------ ---------- ---------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
T. C. Norris................... 1993 316,337 15,184 0(4) 45,000 0 9,405(5)
Chairman, President 1992 302,144 205,458 0 0 286,000 8,980(5)
and CEO 1991 286,550 303,456 1,556,250 0 413,250 --
R. W. Wand..................... 1993 182,157 8,744 0 25,000 718,750 5,490(5)
Vice President, 1992 176,439 104,099 0 0 53,625 5,318(5)
Administration 1991 168,000 154,224 0 0 77,484 --
J. F. Myers.................... 1993 149,094 7,157 0(6) 25,000 0 4,473(7)
Vice President, 1992 141,012 83,197 0 0 35,750 4,230(7)
Manufacturing Technology 1991 130,122 107,221 0 0 51,656 --
M. A. Johnson II............... 1993 144,813 6,951 0 0 283,500 10,304(8)
Retired; former Executive
Vice 1992 213,369 132,289 0 0 1,855,125 6,340(5)
President, Treasurer and CFO 1991 203,310 196,194 415,000 0 206,625 --
G. H. Glatfelter II(9)......... 1993 119,899 6,355 0 25,000 0 0
Vice President, General
Manager- 1992 -- -- -- -- -- --
Glatfelter Paper Division 1991 -- -- -- -- -- --
R. S. Lawrence(9).............. 1993 119,112 1,634 0 25,000 0 2,808(7)
Vice President, 1992 -- -- -- -- -- --
General Manager- 1991 -- -- -- -- -- --
Ecusta Division
</TABLE>

- ---------------

(1) Reflects distributions under broad-based profit sharing plans payable to all
salaried employees and bonuses under the Management Incentive Plans for
executive officers and other senior level employees. Bonuses were not
earned in 1993 since earnings did not meet minimum award goals.

(2) No dividends are paid on restricted stock awards which have not vested or on
options which have not been exercised.

(3) Disclosure of All Other Compensation is not required for 1991.

(4) At December 31, 1993, 160,000 shares of restricted stock were held for
future vesting at various dates at a value of $2,980,000.

(5) Consists of $25 payable to employees at the Company's Spring Grove mill with
service to the Company in excess of 25 years and matching contributions
under the Company's Employee Stock Purchase Plan.

(6) At December 31, 1993, 50,000 shares of restricted stock were held for future
vesting at a value of $931,250.

(7) Consists of matching contributions under the Company's Employee Stock
Purchase Plan.

(8) Consists of (i) $6,000 paid to Mr. Johnson as compensation for being a
director after his retirement as an officer of the Company, (ii) $25
payable to employees at the Company's Spring Grove mill with service to the
Company in excess of 25 years and (iii) matching contributions under the
Company's Employee Stock Purchase Plan.

(9) Individuals were elected as executive officers in 1993, so disclosure is not
required for 1992 and 1991.

5
<PAGE> 8

OPTION GRANTS AND YEAR-END OPTION VALUES

The following tables set forth information concerning the number of options
granted during 1993 and the value of unexercised options to purchase Common
Stock held by the named executive officers at December 31, 1993. Under the terms
of the stock options granted during 1993, none of the options were exercisable
until 1994.

OPTION GRANTS IN 1993

<TABLE>
<CAPTION>
POTENTIAL REALIZED
VALUE AT ASSUMED
ANNUAL RATES OF
NUMBER OF % OF STOCK PRICE
SECURITIES TOTAL OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM(2)
OPTIONS EMPLOYEES PRICE EXPIRATION --------------------
NAME GRANTED(#)(1) DURING 1993 ($/SH)(1) DATE 5%($) 10%($)
- ----------------------- ------------- ------------- ---------- ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
T. C. Norris........... 45,000 4.8 17.97 5/01/03 508,520 1,288,690
R. W. Wand............. 25,000 2.7 17.97 5/01/03 282,511 715,939
J. F. Myers............ 25,000 2.7 17.97 5/01/03 282,511 715,939
M. A. Johnson II....... 0 0 n/a n/a n/a n/a
G. H. Glatfelter II.... 25,000 2.7 17.97 5/01/03 282,511 715,939
R. S. Lawrence......... 25,000 2.7 17.97 5/01/03 282,511 715,939
</TABLE>

- ---------------

(1) Options granted are exercisable with respect to 25% of the total number of
shares subject to an option on each of January 1, 1994 and January 1 of the
following three years, provided the grantee of the option has been
continuously employed by the Company since the date of grant.

(2) Based on these assumed rates of appreciation, the aggregate market value of
the 43,987,328 shares of the Company's Common Stock outstanding on December
31, 1993, would increase by approximately $468,000,000 ($10.64 per share)
and $1,231,000,000 ($28.00 per share), respectively, over the same period.
The dollar amount shown for the six named executive officers is not
discounted to present value and is prior to payment of federal and state
taxes.

AGGREGATED OPTION EXERCISES IN 1993
AND OPTION VALUES AT DECEMBER 31, 1993

<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT 12/31/93(#) OPTIONS AT 12/31/93($)(1)
ACQUIRED ON VALUE -------------------------- --------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISED EXERCISABLE UNEXERCISED
- -------------------------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
T. C. Norris.............. 0 n/a 0 45,000 0 29,531
R. W. Wand................ 0 n/a 0 25,000 0 16,406
J. F. Myers............... 0 n/a 0 25,000 0 16,406
M. A. Johnson II.......... 0 n/a 0 0 0 0
G. H. Glatfelter II....... 0 n/a 0 25,000 0 16,406
R. S. Lawrence............ 0 n/a 0 25,000 0 16,406
</TABLE>

- ---------------

(1) Value is the difference between the market value per share of the Company's
Common Stock on December 31, 1993 and the exercise price per share,
multiplied by the number of shares issuable on exercise of the option.

6
<PAGE> 9

EMPLOYEE BENEFIT PLANS

Profit Sharing Plans

The Company has Profit Sharing Plans for its salaried employees for each of
its four profit centers: Corporate (divided into two groups, one of which
excludes, and the other of which includes, profits and equity attributable to
the Ecusta Division), Spring Grove mill, Neenah mill and Ecusta Division. The
operating rules for each of these Plans provide for an annual contribution equal
to a percentage of each participant's salary that varies with the performance of
his profit center, with a maximum award of 15% of salary. For 1993, only salary
up to $235,840 annually was considered in determining a participant's profit
sharing award. Each award under a Profit Sharing Plan remains in the Plan for
later payment, generally on retirement.

Salary Continuation Plan

The Company has a Salary Continuation Plan which provides for the payment
for ten years following the retirement or death of the participant of an amount
which on an actuarial basis as computed in 1987, was expected to equal the
difference between 55% of the participant's compensation at age 60 and the sum
of Social Security and Company pension plan retirement benefits to which the
participant is entitled. If the participant dies prior to retirement, the
benefits are payable to the participant's beneficiary. Compensation for purposes
of the Salary Continuation Plan generally includes salary plus cash received and
deferred compensation accrued under the Company's Management Incentive Plans and
Salaried Employees' Profit Sharing Plans and Company contributions under the
Employee Stock Purchase Plan. The Company has purchased insurance on the lives
of the participants to provide funds to help offset the costs of benefits
payable under the Plan. There are two executive officers of the Company who are
participants in the Plan.

Pension Plans

Officers and directors who are full time employees of the Company
participate either in the Spring Grove Division Pension Plan for salaried
employees or the Ecusta Division Pension Plan for salaried employees (the
"Pension Plans"). Benefits payable under the Pension Plans are based upon years
of service and average annual compensation for the five consecutive calendar
years during the ten years preceding the year of retirement that yield the
highest average. Participants in the Spring Grove Division plan who have been
participating since before May 1, 1970 ("Certain Participants") may receive a
benefit, if greater, which does not give effect to years of service, based on
plan earnings, which consist of the sum of average compensation in excess of
annual base salary for the five year period prior to the year of actual
retirement, or, if earlier, the year in which the employee attains age 60, and
the annual base salary as of the April 30th closest to the retirement date or,
if earlier, the April 30th closest to the 60th birthday. The retirement benefits
under the Spring Grove Division Pension Plans are not subject to any deduction
for Social Security benefits. Retirement benefits accrued under the Ecusta
Division Pension Plan are reduced by the amount of any pension benefits payable
under the Olin Corporation Salaried Pension Plan, which Plan was applicable to
salaried employees of Olin Corporation's Ecusta paper and film group prior to
its sale on July 24, 1985. Annual compensation for purposes of the Pension Plans
generally includes salary plus cash received under the Management Incentive
Plans in the year, other than cash that had been deferred from a prior year, in
certain cases includes amounts paid under the Profit Sharing Plans and does not
include awards under the 1988 Restricted Common Stock Award Plan or the
Long-Term Incentive Plan, or Company contributions under the Company's Employee
Stock Purchase Plan. To the extent deferral of an award under the Company's
Management Incentive Plans causes a reduction in a participant's pension under
the Company's qualified Pension Plan applicable to him, the Management Incentive
Plans provide a pension supplement. For participants who retire after 1988,
annual compensation for purposes of the Pension Plans is limited by law
($235,840 for 1993).

Annual benefits under the Company's qualified Pension Plans are limited by
law ($115,641 for 1993), subject to adjustment for cost-of-living increases.
Further, the annual benefits of Certain Participants are also

7
<PAGE> 10

limited by the Tax Reform Act of 1986 to the extent that accrued benefits are in
excess of a benefit frozen as of December 31, 1988. The Company has a
Supplemental Executive Retirement Plan which provides participants with pension
benefits that would have been payable under the Company's qualified Pension
Plans but for such limits and the limit on annual compensation described in the
preceding paragraph. Benefits are payable under this Plan at the time the
participant receives benefits from the Company's qualified Pension Plans,
although a participant who retires prior to age 65 may elect to defer payments
until as late as age 65. The benefits payable under this Plan to each
participant are equal to the difference between the benefits that would have
been payable under the applicable qualified Pension Plan in the absence of any
legal limits and the benefits actually payable under the applicable qualified
Pension Plan. Participants may elect to receive the benefits in any form
permitted under the applicable qualified Pension Plan, or in the form of a
single sum. Employees become eligible to participate at such times as the
pension benefits to which they would otherwise be entitled exceed the limits on
benefits payable from a qualified Pension Plan.

The following table shows the estimated annual retirement benefits payable
in the form of a single life annuity at normal retirement age under the Pension
Plans for salaried employees, the Supplemental Executive Retirement Plan and the
pension supplement provided under the Management Incentive Plans.

PENSION PLAN TABLE

<TABLE>
<CAPTION>
ESTIMATED ANNUAL RETIREMENT BENEFIT BASED ON YEARS OF
AVERAGE ANNUAL SERVICE
FIVE YEAR PLAN -------------------------------------------------------
COMPENSATION 15 20 25 30 35
- -------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
125,000..................................... 25,782 34,376 42,970 46,095 49,220
150,000..................................... 31,032 41,376 51,720 55,470 59,220
175,000..................................... 36,282 48,376 60,470 64,845 69,220
200,000..................................... 41,532 55,376 69,220 74,220 79,220
250,000..................................... 52,032 69,376 86,720 92,970 99,220
300,000..................................... 62,532 83,376 104,220 111,720 119,220
400,000..................................... 83,532 111,376 139,220 149,220 159,220
500,000..................................... 104,532 139,376 174,220 186,720 199,220
600,000..................................... 125,532 167,376 209,220 224,220 239,220
700,000..................................... 146,532 195,376 244,220 261,720 279,220
800,000..................................... 167,532 223,376 279,220 299,220 319,220
</TABLE>

The following executive officers who participate in the Pension Plans had the
indicated credited years of service at December 31, 1993: T. C. Norris: 34
years, R. W. Wand: 28 years, J. F. Myers: 26 years, G. H. Glatfelter II: 17
years, and R. S. Lawrence: 33 years.

Of the named executive officers at December 31, 1993, Mr. Norris and Mr.
Myers were participants in the Spring Grove Division Pension Plan before May 1,
1970 and their accrued benefits at age 65 in the form of a single life annuity
under such plan, calculated without respect to service, were $243,449 and
$100,909 per year, respectively. M. A. Johnson retired on August 1, 1993 and
began receiving pension benefits in accordance with the descriptions of the
plans as stated above.

Mr. Lawrence's accrued benefit under the Ecusta Division Pension Plan would
be offset by accrued benefits payable by Olin Corporation.

The Company has a Supplemental Management Pension Plan which provides for
the payment of an early retirement supplement to any participant who retires
before reaching age 65 and elects to defer receipt of benefits under one of the
Company's Pension Plans until he reaches age 65 or, if earlier, until the first
day of

8
<PAGE> 11

the 36th month following his retirement. The monthly payment equals the monthly
amount calculated for the participant under the Pension Plan, but with the
addition of three years to the participant's age. Payments end when the
participant or the participant's beneficiary begins to receive payments under
the Pension Plan or, if there is no beneficiary, at death.

COMPENSATION COMMITTEE INTERLOCK
AND INSIDER PARTICIPATION

The Compensation Committee consists of four members of the Board of
Directors: J. W. Kennedy (Chairman), P. H. Glatfelter III, R. S. Hillas and
P. R. Roedel. Mr. Glatfelter is Chairman Emeritus and a former Chairman of the
Board and President of the Company, and is also a principal shareholder of the
Company (see "Ownership of Common Stock" below). No member of this Committee is
an executive officer of a company on whose board an executive officer of the
Company serves as a director.

REPORT OF COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION

The Compensation Committee reviews and approves the elements of the
Company's executive compensation program and assesses the effectiveness of the
program as a whole. The Compensation Committee's responsibilities include: (i)
reviewing and establishing the level of salaries and benefits for corporate
officers and other key senior management employees of the Company, including but
not limited to benefits under the Company's profit sharing plans, defined
benefits plans and other welfare benefits plans, (ii) reviewing annually with
the Company's Chief Executive Officer, T. C. Norris, the job performance of
corporate officers and key senior management as measured against financial and
other objectives and the Company's achievements as compared to certain other
companies in the paper and forest products industry, and (iii) reviewing and
recommending to the Board of Directors the participants in and the operating
rules and profitability objectives for awards under the Company's Management
Incentive Plans.

The Compensation Committee from time to time reviews the Company's entire
executive compensation structure through an examination of compensation
information for comparable companies and certain broader-based data, including
data relating to the geographic areas in which the Company has facilities,
compiled by compensation and other consulting firms. As used herein, comparable
companies refer to other companies in the paper and forest products industry
(both publicly and privately owned) selected by management as being the
companies in the industry which on an overall basis are most similar to the
Company in relation to size, products and financial and other characteristics.
Certain of the comparable companies are included in the Dow Jones Paper Products
Industry Group and/or the S&P 500, and therefore are represented in the Stock
Performance Chart below. In examining the compensation paid by the comparable
companies, the Compensation Committee does not analyze the stock performance of
such companies.

Executive Compensation Policies. The Compensation Committee has generally
structured the Company's executive compensation program (i) to be competitive
with compensation programs of comparable companies in order to attract and
retain high caliber executive officers and senior management personnel and (ii)
to align individual compensation with the Company's operating performance in
order to provide strong incentives to achieve the Company's short-term and
long-term goals. The elements of the Company's executive compensation program
are salary, annual incentive compensation and long-term incentive compensation
and other benefits. The Compensation Committee will study whether any revisions
to the Company's executive compensation program are appropriate due to Section
162(m) of the Internal Revenue Code and recently proposed regulations relating
thereto which limit deductibility of compensation over $1 million paid to an
executive officer in a year.

9
<PAGE> 12

Salary. The Company's policy is to pay fair salaries at levels which are
sufficient to attract and retain high caliber individuals based on the relative
value of each position, as measured against comparable companies. The
Compensation Committee assigns each executive position a salary range based on
the salary level for similar positions at comparable companies. Ranges are
adjusted by the Committee periodically.

Generally, executive officer salaries are reviewed and approved annually.
The salary for each executive is set by the Compensation Committee within the
established range for the position after an assessment of his or her performance
and the relation of his or her salary to the midpoint for the relevant salary
range, as well as the Company's financial results and general economic
conditions.

Annual Incentive Compensation. The Compensation Committee establishes
incentive bonus opportunities to motivate salaried employees to increase the
profits of the Company. The incentive bonus opportunities potentially represent
a significant portion of total compensation and are intended to correlate with
the financial performance of the Company or one or more divisions thereof. The
Compensation Committee believes that executive officers should not receive any
incentive bonus if the Company does not achieve certain minimum financial
objectives.

Incentive bonuses for executive officers have been based on return on
shareholders' equity for the Company, return on shareholders' equity for the
Company, excluding the effect of the Ecusta Division, and return on profit as a
percentage of sales for the Ecusta Division. The performance measure assigned to
each officer depends on the area of his particular responsibility within the
Company. Such bonuses could increase in amount up to a maximum set by the
Compensation Committee as the returns on shareholders' equity and profit as a
percentage of sales increase. Although 1993 financial performance for the
Company was not expected to be in line with prior years due to the difficult
economic environment and the loss of the Philip Morris business, the
Compensation Committee elected to maintain the same objectives for the 1993
returns on shareholders' equity as used in 1992. The financial objectives for
1993 for profit as a percentage of sales for the Ecusta Division were lowered to
levels which the Compensation Committee determined would be challenging to
achieve. In years prior to 1993, a substantial portion of compensation for
executive officers consisted of incentive bonuses. Because in 1993 the Company
did not achieve the minimal levels of return on shareholders' equity and the
Ecusta Division did not achieve the minimal level of profit as a percentage of
sales required for such bonuses to be paid, no bonuses were paid to executive
officers for such year. As a result, the sum of the salary and bonus received by
executive officers for 1993 is significantly lower than for prior years.

Long-Term Incentive Compensation. The Company's Long-Term Incentive Plan,
which was approved by shareholders in 1992, enables the Company to offer key
employees of the Company equity interests in the Company and other incentive
awards, including performance-based stock incentives. Certain features of the
Plan are similar to long-term incentives offered by many of the comparable
companies. The primary purposes of the Plan are attracting, retaining and
rewarding key employees, and strengthening the mutuality of interests between
key employees and the Company's shareholders. Long-term incentive awards under
the Plan are granted by the Compensation Committee based on the attainment of
specific performance goals or such other factors or criteria as the Committee
shall determine.

Effective May 1, 1993, subsequent to the Company's corporate-wide
rightsizing and related restructuring and after a review of the various
alternatives under the Long-Term Incentive Plan, the Compensation Committee
elected to grant stock options to certain key management employees (including
executive officers). Options were selected by the Compensation Committee because
they most directly tie the employee's reward to the increase in the market value
of the shareholder's investment in the Company. The options have terms of ten
years and generally vest in equal annual increments over four years beginning
January 1, 1994. The exercise price of the options was set at 100% of the fair
market value of the Common Stock at the time of the grant of the options, which
assures that such employees will receive a benefit only when shareholder value
increases. Individual grants were based on each such employee's current salary
grade

10
<PAGE> 13

plus a fixed number of options for each officer of the Company. The number of
options for each salary grade and per executive officer was selected by the
Committee on the basis of the general experience of its members in such matters
and their subjective judgment.

CEO Compensation. Mr. Norris' salary was increased from an annual rate of
$305,042 to $320,102 effective April 1, 1993. The Compensation Committee granted
the increase based on (i) the location of Mr. Norris' salary in the salary range
established by the Committee for his position and (ii) Mr. Norris' performance
in directing the Company through a difficult economic environment, including a
corporate-wide rightsizing and related restructuring. Mr. Norris did not receive
a bonus for 1993 because, as noted above, the Company did not achieve the
established minimum level of return on shareholders' equity required to pay
bonuses. As a result, the sum of the salary and incentive bonus paid to Mr.
Norris for 1993 was 35% less than the sum of the salary and incentive bonus paid
to him for 1992.

As part of the stock options granted effective May 1, 1993, Mr. Norris
received an option to purchase 45,000 shares of Common Stock of the Company. The
number of shares of Common Stock for which such option was granted was
determined by the Compensation Committee based on its members' general knowledge
regarding the level of options granted to chief executive officers and their
subjective judgment. Such grant was intended to place a significant portion of
Mr. Norris' total compensation at risk, since the options will have no value
unless there is appreciation in the value of the Company's Common Stock over the
option term.

J. W. Kennedy
P. H. Glatfelter III
R. S. Hillas
P. R. Roedel

11
<PAGE> 14

STOCK PERFORMANCE CHART

The following chart compares the yearly percentage change in the cumulative
total shareholder return on the Company's Common Stock during the five years
ended December 1993 with the cumulative total return on the S&P 500 Composite
Index and the Dow Jones Paper Products Industry Group. The comparison assumes
$100 was invested on December 31, 1988 in the Company's Common Stock and in each
of the foregoing indices and assumes reinvestment of dividends.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNS
AMONG P. H. GLATFELTER COMPANY, S&P 500 COMPOSITE INDEX AND
DOW JONES PAPER PRODUCTS INDUSTRY GROUP

<TABLE>
<CAPTION>
DOW JONES
P.H. S&P 500 PAPER PROD-
MEASUREMENT PERIOD GLATFELTER COMPOSITE UCTS IND
(FISCAL YEAR COVERED) COMPANY INDEX USTRY GROUP
<S> <C> <C> <C>
1988 100 100 100
1989 118 132 111
1990 121 128 98
1991 152 167 123
1992 104 179 121
1993 113 197 137
</TABLE>

CERTAIN TRANSACTIONS

R. E. Chappell, a director of the Company, was an Executive Vice President
of PNC Bank Corp. during 1993. R. L. Smoot, a director of the Company, is
President of PNC Bank, National Association ("PNC Bank"), a subsidiary of PNC
Bank Corp. PNC Bank has a banking relationship with the Company and provides
general banking services and credit facilities. The Company has a line of credit
with PNC Bank in the amount of $45,000,000, in respect of which the Company paid
$173,000 in interest for 1993. The maximum outstanding principal balance in 1993
was $41,100,000. All transactions between the Company and PNC Bank have been
made in the ordinary course of business and on substantially the same terms as
those prevailing at the time for comparable transactions with other persons.

12
<PAGE> 15

OWNERSHIP OF COMMON STOCK

The following table sets forth as of March 2, 1994 the holdings of (i) each
person who is known by the Company to own beneficially more than 5% of the
Common Stock of the Company, (ii) each director and certain executive officers
and (iii) all directors and executive officers of the Company as a group. All
stock with respect to which a person has the right to acquire beneficial
ownership within 60 days is considered beneficially owned by that person.

<TABLE>
<CAPTION>
PERCENTAGE
OF CLASS
VOTING AND/OR (IF
INVESTMENT GREATER
NAME DIRECT(1) POWER(2) THAN 1%)
---- --------- ------------- ----------
<S> <C> <C> <C>
Principal Holders
PNC Bank Corp....................................... 0 17,268,185(3) 39.3%
Fifth Avenue and Wood Street
Pittsburgh, Pa.
P. H. Glatfelter III................................ 0 10,455,456(4)(5) 23.8%
Spring Grove, Pa.
G. H. Glatfelter.................................... 0 4,796,477(5)(6) 10.9%
Spring Grove, Pa.
P. H. Glatfelter Family
Shareholders' Voting Trust....................... 0 13,570,752(7) 30.9%
c/o PNC Bank
17th and Chestnut Streets
Philadelphia, Pa.
</TABLE>

Directors and certain officers (other than those listed above)

<TABLE>
<CAPTION>
NAME
----
<S> <C> <C> <C>
G. Baldwin, Jr...................................... 0 2,000 --
R. E. Chappell...................................... 0 2,000 --
G. H. Glatfelter II................................. 0 18,860(8) --
R. S. Hillas........................................ 6,000 0 --
M. A. Johnson II.................................... 10,544 1,536 --
J. W. Kennedy....................................... 14,800 2,000 --
R. S. Lawrence...................................... 2,702 6,250(9) --
J. F. Myers......................................... 58,964 10,827(9) --
T. C. Norris........................................ 45,680 22,784(10) --
P. R. Roedel........................................ 200 0 --
J. M. Sanzo......................................... 500 0 --
R. L. Smoot......................................... 0 0 --
R. W. Wand.......................................... 40,470 19,221(9) --
All directors and executive officers as a group..... 180,502 11,551,375(11) 26.3%
</TABLE>

- ---------------

(1) Reported in this column are shares held of record.

(2) Does not include shares reported in Direct Ownership column for purposes of
the table, shares of Common Stock are considered beneficially owned by a
person if such person has or shares voting or investment power with respect
to such stock. As a result, the same security may be beneficially owned by
more than one person and, accordingly, in some cases, the same shares are
listed opposite more than one name in the table. Also includes, in some
cases, shares beneficially held by wives or minor children, as to which
beneficial ownership is disclaimed.

13
<PAGE> 16

(3) Consists of 9,084,739 shares as to which PNC Bank Corp. has sole voting
power; 7,891,344 shares as to which PNC Bank Corp. has shared voting power;
9,039,761 shares as to which PNC Bank Corp. has sole investment power; and
7,965,052 shares as to which PNC Bank Corp. has shared investment power.
The amounts specified for shared voting power and shared investment power
both include 6,239,880 and 88,964 shares held as co-trustee with P. H.
Glatfelter III and G. H. Glatfelter, respectively. In addition, 13,570,752
shares of the total amount of shares beneficially held by PNC Bank Corp.
are deposited in the Voting Trust (see footnotes (5) and (7)).

(4) Includes 6,239,880 shares held as co-trustee with PNC Bank; 1,291,996
shares (of which 1,021,852 shares are also included in the total number of
shares which he holds as co-trustee) which P. H. Glatfelter III has the
right to withdraw from certain trusts of which PNC Bank is trustee;
3,806,352 shares (all of which are held in trusts of which PNC Bank is
trustee) which P. H. Glatfelter III and G. H. Glatfelter have the
collective right, on certain conditions, to purchase; and 869,424 shares
(of which 689,232 shares are also included in the total number of shares
which he holds as co-trustee and the remainder are held in trusts of which
PNC Bank is trustee) which P. H. Glatfelter III has the right, on certain
conditions, to purchase.

(5) All shares beneficially owned by P. H. Glatfelter III and G. H. Glatfelter
are deposited in the Voting Trust (see footnote (7)).

(6) Includes 88,964 shares held as co-trustee with PNC Bank, 905,577 shares (of
which 4,416 shares are also included in the total number of shares which he
holds as co-trustee) which G.H. Glatfelter has the right to withdraw from
certain trusts of which PNC Bank is trustee and 3,806,352 shares which
P. H. Glatfelter III and G. H. Glatfelter have the collective right, on
certain conditions, to purchase. Excludes shares deposited by other
Glatfelter family members in the Voting Trust, of which G. H. Glatfelter is
a co-trustee (see footnote (7)).

(7) Consists of shares beneficially owned by certain descendants of Philip H.
Glatfelter or the spouses of such descendants, including shares
beneficially owned by P. H. Glatfelter III, G. H. Glatfelter and G. H.
Glatfelter II which were deposited in the P. H. Glatfelter Family
Shareholders' Voting Trust dated July 1, 1993 (the "Voting Trust"). Shares
deposited in the Voting Trust may be withdrawn subject to certain
conditions. Co-trustees for the Voting Trust are William M. Eyster II,
Patricia G. Foulkrod, William L. Glatfelter III, George H. Glatfelter,
Irene G. Fegley and PNC Bank. Co-trustees other than PNC Bank each
represent a family group. The shares deposited in the Voting Trust may be
voted only in accordance with a majority of votes cast by the co-trustees
pursuant to a weighted formula in which (i) each co-trustee (other than PNC
Bank) is entitled to cast such number of votes as is equal to the number of
shares deposited in the Voting Trust in which members of his or her family
group have an interest and (ii) PNC Bank is entitled to cast such number of
votes as is equal to the number of shares deposited in the Voting Trust in
which any fiduciary trust of which PNC Bank is a trustee and which is for
the benefit of one or more Glatfelter family members has an interest. The
co-trustees have no dispositive power with regard to the shares deposited
in the Voting Trust. The Voting Trust will continue until it is terminated
by the co-trustees or all of the shares deposited in the Voting Trust are
withdrawn. The address for each of the co-trustees is c/o PNC Bank, 17th
and Chestnut Streets, Philadelphia, Pa.

(8) Includes 6,250 shares subject to currently exercisable portion of an
option. Of the shares beneficially owned by G. H. Glatfelter II, 11,580 are
subject to the Voting Trust (see footnote (7)).

(9) Includes 6,250 shares subject to currently exercisable portion of an
option.

(10) Includes 11,250 shares subject to currently exercisable portion of an
option.

(11) Includes 9,716 shares held in participants' accounts under the Company's
Salaried Employee Stock Ownership Plan and 14,749 shares held in
participants' accounts under the Company's Employee Stock Purchase Plan.
Also includes 51,000 shares subject to currently exercisable portions of
options.

14
<PAGE> 17

P. H. Glatfelter III, G. H. Glatfelter, the Voting Trust and PNC Bank Corp.
may be deemed to be "control persons" of the Company for purposes of the proxy
rules and regulations of the Securities and Exchange Commission.

OTHER BUSINESS

The Board of Directors does not intend to present to the meeting any
business other than the election of directors. If any other matter is presented
to the meeting which under applicable proxy regulations need not be included in
this proxy statement or which the Board of Directors did not know would be
presented a reasonable time before this solicitation, the persons named in the
accompanying proxy will have discretionary authority to vote proxies with
respect to such matter in accordance with their best judgment.

DEADLINE FOR SHAREHOLDER PROPOSALS

The Company must receive any proposal which a shareholder wishes to submit
to the 1995 annual meeting of shareholders by November 17, 1994, if the proposal
is to be considered by the Board of Directors for inclusion in the proxy
material for that meeting.

R. S. WOOD,
Secretary

March 17, 1994

15
<PAGE> 18

(LOGO)
Printed on Recycled Paper

Printed on Ecusta Nyalite
Manufactured by the Ecusta Division of the
P. H. Glatfelter Company
Basis 25x38 -- 40 lb Recycled.
<PAGE> 19
.PROXY
P.H. GLATFELTER COMPANY
SPRING GROVE, PENNSYLVANIA
--------------------------
PROXY SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS OF THE COMPANY FOR THE ANNUAL MEETING
OF SHAREHOLDERS TO BE HELD APRIL 27, 1994

The undersigned shareholder of P.H. Glatfelter Company hereby appoints G.
Baldwin, Jr., M.A. Johnson II and J.W. Kennedy and each of them, attorneys and
proxies, with power of substitution in each of them, to vote and act for and on
behalf of the undersigned at the annual meeting of shareholders of the Company
to be held at the Company's principal office, Spring Grove, Pennsylvania, on
Wednesday, April 27, 1994, and at all adjournments thereof, according to the
number of shares which the undersigned would be entitled to vote if then
personally present, as indicated hereon and in their discretion upon such other
business as may come before the meeting, all as set forth in the notice of the
meeting and in the proxy statement furnished herewith, copies of which have been
received by the undersigned; and hereby ratifies and confirms all that said
attorneys and proxies may do or cause to be done by virtue hereof.
It is agreed that unless otherwise marked on the other side said attorneys
and proxies are appointed WITH authority to vote FOR the election of directors.

(PLEASE FILL IN, SIGN AND DATE ON THE OTHER SIDE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE)
(Continued and to be signed on reverse side)

THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" THE NOMINEES.
1. ELECTION OF DIRECTORS: Nominees: Term Expiring in 1997, R.E. Chappell,
G.H. Glatfelter II, T.C. Norris and R.L. Smoot. To withhold authority to
vote for any individual nominee, write that nominee's name in the space
below:

- -------------------------------------------------------------------
(Mark only one)
/ / VOTE for all nominees listed above, except as indicated above
/ / VOTE WITHHELD from all nominees

Signature should be the same as the name
printed at the left. Executors,
administrators, trustees, guardians,
attorneys, and officers of corporations
should add their title when signing.

Signature: Date:
------------------- -----
Signature: Date:
------------------- -----