<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:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
M. A. Hanna Company
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 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:
------------------------------------------------------------------------
<PAGE>
M.A.HANNACOMPANY
SUITE 36-5000, 200 PUBLIC SQUARE, CLEVELAND, OHIO 44114-2304
To Our Stockholders:
On behalf of the Board of Directors and management, I cordially invite you
to attend the 1996 annual meeting of stockholders of the Company to be held on
Wednesday, May 1, 1996, at 10:30 A.M. at the Forum Conference Center Auditorium,
1375 East Ninth Street, Cleveland, Ohio.
At the meeting, in addition to considering and acting on the matters
described in the Proxy Statement, there will be a management report. Following
the report, there will be an opportunity for stockholders to ask questions about
the Company and its operations.
If you will need special assistance at the meeting because of a disability,
please contact the office of the Corporate Secretary at the above address.
Whether or not you currently plan to attend the meeting, it is important
that you exercise your right to vote. Please sign, date and return the proxy
card promptly.
I look forward to seeing you on May 1.
Sincerely,
M. D. WALKER
CHAIRMAN
<PAGE>
M.A.HANNACOMPANY
SUITE 36-5000, 200 PUBLIC SQUARE
CLEVELAND, OHIO 44114-2304
NOTICE OF ANNUAL MEETING
The annual meeting of stockholders of M. A. Hanna Company will be held on
Wednesday, May 1, 1996 at 10:30 A.M. at the Forum Conference Center Auditorium,
1375 East Ninth Street, Cleveland, Ohio, for the following purposes:
(1) Electing nine directors for the ensuing year;
(2) Ratifying the appointment of auditors;
(3) Approving an Amendment to the Company's Amended Certificate of
Incorporation to increase the authorized number of shares of Common Stock
from 50,000,000 to 100,000,000; and
(4) Transacting such other business as may properly come before the meeting.
The Board of Directors has fixed the close of business on March 5, 1996, as
the record date for the determination of stockholders entitled to notice of, and
to vote at, the meeting or any adjournment thereof.
JOHN S. PYKE, JR.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
March 20, 1996
PLEASE FILL OUT, SIGN AND MAIL THE ENCLOSED FORM OF PROXY IF YOU DO NOT
EXPECT TO BE PRESENT AT THE ANNUAL MEETING. A SELF-ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
<PAGE>
PROXY STATEMENT
This statement is furnished in connection with the solicitation by the Board
of Directors of M. A. Hanna Company of proxies to be used at the annual meeting
of stockholders of the Company to be held on Wednesday, May 1, 1996. The meeting
will be held at the Forum Conference Center Auditorium, 1375 East Ninth Street,
Cleveland, Ohio.
If the accompanying form of proxy is properly executed and returned, the
shares represented by it will be voted and, where a specification is made by the
stockholder, as provided therein, will be voted in accordance with such
specification. If no such specification is made, the shares will be voted in
accordance with the recommendations of the Company's management. The proxy may,
nevertheless, be revoked prior to its exercise by delivering written notice of
revocation to the Company, by executing a later dated proxy or by attending the
meeting and voting in person. For stockholders participating in the Company's
Dividend Reinvestment and Stock Purchase Plan, the administering bank will only
vote the shares that it holds for the participant's account in accordance with
the proxy returned by the participant and the procedures set forth above. If a
proxy is not returned or returned unsigned, none of the shares represented by
that proxy, whether held in the Dividend Reinvestment and Stock Purchase Plan or
otherwise, will be voted.
At the annual meeting, the results of stockholder voting will be tabulated
by the inspectors of election appointed for the annual meeting. The Company
intends to treat properly executed proxies that are marked "abstain" or that are
held in "street name" by brokers and are not voted on one or more particular
proposals (if otherwise voted on at least one proposal) as "present" for
purposes of determining whether a quorum has been achieved at the annual
meeting. Directors will be elected by a plurality vote. Votes withheld in
respect of the election of directors will not be counted in determining the
outcome of that vote. In respect of the proposals to ratify the appointment of
independent public accountants and ratify and approve the amendment to the
Company's Amended Certificate of Incorporation, abstentions will be treated as
votes against the proposal and broker non-votes will be treated as having no
effect on the outcome of the vote.
At the close of business on March 5, 1996 the record date for the annual
meeting, the Company had outstanding and entitled to vote 34,726,438 shares of
Common Stock. Each share of Common Stock is entitled one vote on each matter
brought before the meeting.
The Company has retained Georgeson & Co. Inc., a proxy solicitation firm,
for a fee of $8,000 plus reimbursement of normal expenses, to assist employees
of the Company in the solicitation of proxies by personal interview, telephone
and other means. The cost of solicitation of proxies will be borne by the
Company.
The Notice of Annual Meeting, Proxy Statement and form of proxy are first
being mailed to stockholders on approximately March 20, 1996. The Annual Report
of the Company for the year ended December 31, 1995 was first mailed to
stockholders on February 23, 1996, but the Annual Report is not deemed to be
part of this Proxy Statement.
At the annual meeting of stockholders of the Company held on May 3, 1995,
approximately 88% of the then outstanding shares were present at the meeting and
voting.
1. ELECTION OF DIRECTORS
The Board has nominated for re-election to the Board at the 1996 annual
meeting the nine incumbent Directors, all of whom were elected at the 1995
annual meeting of stockholders.
It is intended that shares represented by the proxies in the accompanying
form will be voted for the election of the nine nominees listed below to serve
as directors for a term of one year and until their successors are elected and
qualified. If any nominee should be unable or unwilling to serve as a director,
which the Board of Directors does not anticipate, the proxies will be voted for
such other person as the Board of Directors may select or the size of the Board
may be reduced accordingly.
1
<PAGE>
The following table lists information as of January 31, 1996 as to each
nominee for director, his or her principal occupation or employment and certain
other directorships. Except as otherwise indicated each nominee has had the same
principal occupation or employment during the past five years.
<TABLE>
<CAPTION>
NOMINEE FOR DIRECTOR PRINCIPAL OCCUPATION AND OTHER DIRECTORSHIPS
- ------------------------ ---------------------------------------------------------------------------------------
<S> <C>
B. C. AMES Partner, Clayton, Dubilier & Rice (investment bankers), May, 1990 to date. Chairman and
Director since 1980 Chief Executive Officer, The Uniroyal Goodrich Tire Company 1988 to May, 1990. Director
Age -- 70 of Diamond Shamrock R&M, Inc., The Progressive Corporation and Warner-Lambert Company.
C. A. CARTWRIGHT President, Kent State University (public higher education institution), 1991 to date.
Ph.D. Vice Chancellor for Academic Affairs, University of California-Davis, 1988-1991.
Director since 1994 Director of Ohio Edison Company, Society National Bank and Republic Engineered Steels,
Age -- 54 Inc. and Director of the American Cancer Society, and National Association for State
Universities and Land-Grant Colleges. Member of National Collegiate Athletic
Association Presidents Council.
W. R. EMBRY President and Chief Operating Officer, Team Division, The Cleveland Cavaliers
Director since 1990 (professional basketball team), 1986 to date. Chairman of the Board of Michael Alan
Age -- 58 Lewis Company (supplier to automotive industry). Director of Centerior Energy
Corporation, Ohio Casualty Insurance Company and Society National Bank.
J. T. EYTON, Chairman and Director, The Edper Group Limited, Brascan Limited and Trilon Financial
O.C. Corporation (collectively in natural resources, power generation and financial
Director since 1986 services). Member of the Senate of Canada. Director of Barick Gold Corporation, Coca
Age -- 61 Cola Beverages Limited, Hees International Bancorp, Inc., Noranda, Inc. and Norcen
Energy Resources Limited.
G. D. KIRKHAM Retired financial industry executive.
Director since 1975
Age -- 63
M. L. MANN Chairman and Chief Executive Officer, Lexmark International, Inc. (office machines),
Director since 1991 March 1991 to date. Vice President of International Business Machines Corporation
Age -- 62 ("IBM") and President and General Manager of various IBM divisions and subsidiaries
1985-March 1991. Director of Infomart, a Trammell Crow Co., and member of the
Independent Board of Trustees, Fidelity Investments.
D. J. MCGREGOR President and Chief Operating Officer of M. A. Hanna, May 3, 1989 to date. Director of
Director since 1990 KeyCorp and Vulcan Materials Corporation.
Age -- 55
R. W. POGUE Senior Advisor, Dix & Eaton (public relations firm), July 1, 1994 to date: Senior
Director since 1988 Partner, Jones, Day, Reavis & Pogue (attorneys) January 1, 1993 to June 30, 1994;
Age -- 67 Managing Partner, 1989-December 31, 1992. Director of Continental Airlines, Derlan
Industries Limited, KeyCorp, OHM Corporation, Redland PLC, Rotek Incorporated, and TRW
Inc. Co-Chairman, Cleveland Bicentennial Commission.
M. D. WALKER Chairman and Chief Executive Officer of M. A. Hanna, September 1986 to date. Director
Director since 1986 of Comerica Inc., The Reynolds and Reynolds Company, Textron Inc. and The Timken
Age -- 63 Company.
</TABLE>
2
<PAGE>
The following table sets forth information as to the beneficial ownership of
the Company's Common Stock on January 31, 1996 by each director-nominee, the
chief executive officer and the four other most highly compensated executive
officers and, as a group, the foregoing persons and other executive officers.
Except as indicated in the footnotes, the director-nominees have sole voting and
investment power over the shares listed.
<TABLE>
<CAPTION>
SHARES PERCENT OF
BENEFICIALLY OUTSTANDING
NAME OWNED SHARES
------------------------------------ ------------- -----------
<S> <C> <C>
B. C. Ames.......................... 27,137(1) *
C. A. Cartwright.................... 5,000(2) *
W. R. Embry......................... 16,150(1) *
J. T. Eyton......................... 8,045(2) *
G. D. Kirkham....................... 25,800(1)(3) *
M. L. Mann.......................... 20,000(1) *
D. J. McGregor...................... 276,242(4) *
R. W. Pogue......................... 28,000(1) *
M. D. Walker........................ 530,944(4)(5) 1.5%
G. W. Henry......................... 67,167(4) *
J. S. Pyke, Jr...................... 85,104(4) *
D. R. Schrank....................... 54,962(4) *
All directors and executive officers
as a group.......................... 1,220,766(4) 3.5%
</TABLE>
* The shares beneficially owned amount to less than one percent of the
outstanding shares of the Company's Common Stock.
(1) Includes 15,000 shares which may be acquired within 60 days through the
exercise of stock options granted under the Company's 1988 Long-Term
Incentive Plan.
(2) Includes 5,000 shares which may be acquired within 60 days through the
exercise of stock options granted under the Company's 1988 Long-Term
Incentive Plan.
(3) Includes 10,800 shares as to which Mr. Kirkham has shared investment and
voting power; the shares owned by a trust for which he serves as a
co-trustee; Mr. Kirkham disclaims any beneficial interest in such shares.
(4) Includes shares which may be acquired within 60 days through the exercise of
stock options as follows: 209,300, 259,975, 45,688, 59,625, 42,875 and
747,821 shares for Messrs. McGregor, Walker, Henry, Pyke, Schrank and the
group, respectively.
(5) Includes 37,500 shares owned by Mr. Walker's wife; Mr. Walker disclaims any
beneficial interest in such shares.
3
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held 7 meetings in 1995. All director-nominees
attended at least seventy-five percent of the meetings of the Board and
committees of the Board on which each served.
In addition to meeting as a group to review the Company's business, certain
members of the Board of Directors also devote their time and talents to the
Board's five standing committees. The committees and their principal functions
are as follows:
The Audit Committee, composed of directors who are not employees of the
Company, held 4 meetings in 1995 with the Company's Vice President and Chief
Financial Officer, Controller, Director of Internal Audit and independent public
accountants to review the plan and results of the audit by the independent
accountants, the Company's financial statements, the scope and results of the
Company's internal auditing procedures, the adequacy of the Company's system of
internal controls and the Company's environmental and litigation exposures. The
Committee also selects and appoints independent public accountants to serve as
the Company's auditors each year and devoted significant time to this
responsibility during the past year. Present members are C.A. Cartwright, W. R.
Embry, G. D. Kirkham (Chairman), and M. L. Mann.
The Board Composition and Governance Committee held one formal meeting in
1995. The Committee reviews and recommends changes in the policies and operation
of the Board and functions and responsibilities of the committees of the Board.
It also acts as a nominating committee of the Board and recommends qualified
candidates for election as directors. Stockholders wishing to nominate
candidates for consideration by the Committee can do so by writing to the
Corporate Secretary and providing the candidate's name, appropriate biographical
data and qualifications. Present members are C.A. Cartwright, W. R. Embry
(Chairman), R. W. Pogue and M. D. Walker.
The Compensation Committee, composed of directors who are not employees of
the Company, held 6 meetings in 1995. It approves remuneration arrangements and
succession plans for senior management and administers the Company's executive
compensation plans. Present members are B. C. Ames, J. T. Eyton, M. L. Mann
(Chairman) and R. W. Pogue.
The Executive Committee exercises all of the authority of the Board of
Directors during intervals between meetings of the Board except for those powers
to be exercised only by other committees of the Board, the declaration of any
dividend, the issuance of stock and the powers which pursuant to Section 141(c)
of the General Corporation Law of the State of Delaware, as amended, may not be
delegated to a Committee. It did not meet formally in 1995. Present members are
B. C. Ames, J. T. Eyton, D. J. McGregor, R. W. Pogue and M. D. Walker
(Chairman).
The Pension Plan Committee, composed of directors who are not employees of
the Company, held 1 meeting in 1995. It is responsible for reviewing the
operation and performance of the Company's pension investment program and a
management committee which in turn is responsible for the operation and
administration of the retirement and welfare plans of the Company and its
subsidiaries. Present members are C.A. Cartwright (Chairperson), W. R. Embry and
G. D. Kirkham.
HOLDINGS OF SHARES OF THE COMPANY'S COMMON STOCK
The only person believed by the Company to be the beneficial owner of more
than five percent of the outstanding shares of Common Stock of the Company as of
December 31, 1995 was Wachovia Bank of North Carolina, N.A., 302 North Main
Street, Winston-Salem, NC 27102. Acting in its capacity as Trustee of the M. A.
Hanna Associates Ownership Trust, Wachovia Bank of North Carolina, N.A. has
advised that on December 31, 1995 it owned and had shared voting and dispositive
power over 4,226,767 shares, or 12% of the shares then outstanding. Shares of
Common Stock are periodically allocated and released from the Trust to satisfy
funding requirements under certain of the Company's compensation and benefit
plans ("Plans"). Participants in and trustees of the Plans under confidential
voting procedures have authority to vote all shares allocated to them or to
instruct that the shares not be voted. Unallocated shares held in the Trust are
voted in the same proportions as the shares for which instructions have been
received.
4
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the compensation for the chief executive
officer and the other most highly compensated executive officers, for services
rendered in all capacities to the Company and its subsidiaries for the last
three years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
--------------------------------------------
ANNUAL AWARDS PAYOUTS
COMPENSATION (1) ------------------------------ -----------
NAME AND ------------------------- RESTRICTED STOCK NUMBER OF LTIP ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS AWARDS ($)(8) OPTIONS (2) PAYOUTS (3) COMPENSATION (4)
- ------------------------------ ---- ----------- ----------- ---------------- ----------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
M. D. Walker 1995 $640,000 $540,000 28,128 75,942 $309,372 $399,185
Chairman & Chief 1994 607,500 525,000 22,521 99,200 292,500 321,248
Executive Officer 1993 600,000 450,000 22,511 70,500 300,000 329,396
D. J. McGregor 1995 436,667 330,000 23,136 40,960 254,364 310,782
President & Chief 1994 415,000 320,000 18,542 49,600 240,500 273,341
Operating Officer 1993 370,000 250,000 17,365 45,000 231,250 163,611
D. R. Schrank 1995 263,333 151,500 0 17,838 NA(5) 50,190
Vice President, North 1994 252,500 160,000 0 15,000 NA(5) 32,750
American Plastics Operations 1993 66,346(6) 35,000(6) 0 51,250(7) NA(5) NA(5)
J. S. Pyke, Jr. 1995 195,000 111,000 6,888 9,819 75,612 96,122
Vice President, General 1994 186,250 110,000 5,512 7,000 71,500 78,686
Counsel & Secretary 1993 185,000 110,000 5,175 7,500 67,845 66,216
G. W. Henry 1995 202,000 110,000 5,640 9,877 61,860 65,010
Vice President 1994 181,250 125,000 4,015 7,000 52,000 49,321
International Operations 1993 175,000 85,000 3,757 6,750 50,009 45,682
</TABLE>
(1) Other Annual Compensation for each executive did not exceed disclosure
thresholds established by the Securities and Exchange Commission.
(2) Option Grants shown in 1993 reflect three-for-two stock split in 1994.
(3) Payout in cash and market value of Common Stock paid under the company's
1988 Long-Term Incentive Plan in the year following the three-year
performance period ending December 31, 1994, 1993 and 1992.
(4) Consists of matching contributions made by the company under the Capital
Accumulation Plan, a retirement type savings plan, of $121,830, $84,455,
$31,750, $30,869, and $30,714 in 1995 for Messrs. Walker, McGregor, Schrank,
Pyke, and Henry, respectively, the dollar value of split dollar life
insurance premiums paid in the amounts of $183,577, $157,557, $18,440,
$48,060, and $24,918 in 1995 for Messrs. Walker, McGregor, Schrank, Pyke,
and Henry, respectively, and the 1995 payouts of dividend credits
accumulated in connection with stock option grants made in 1990, amounting
to $93,778, $68,770, 0, $17,193, and $9,378 for Messrs. Walker, McGregor,
Schrank, Pyke and Henry, respectively.
(5) LTIP payouts made in 1993, 1994, and 1995 were for awards earned based on
the Company's performance over a three year period. Since Mr. Schrank was
not employed by the Company until September 27, 1993, Mr. Schrank was not
eligible to receive a payout.
(6) Reflects partial year data since Mr. Schrank was not employed by the Company
until September 27, 1993.
5
<PAGE>
(7) Includes 41,250 Stock Options granted as part of Mr. Schrank's employment
agreement with the Company. The agreement provides for the vesting of these
options at the rate of 1/3 of the total on the first three anniversary
dates. The remaining 10,000 stock options were granted as part of the
general stock option grant during the normal LTIP award cycle.
(8) The column reports all grants of restricted stock to the named individuals
during the fiscal year. The value of the awards shown in the table is
determined by multiplying the number of shares awarded by the closing market
price for the stock on the award date. The total number of restricted shares
and the value of those shares at the end of the last fiscal year, based on
the year-end closing price for the stock, held by Messrs. Walker, McGregor,
Henry, Schrank and Pyke were 4,670/$130,760; 3,401/$95,228; 0;
1,134/$31,752; and 842/$23,576 respectively. Restricted shares are issued at
the same time LTIP Payouts are made equal in value to 25% of the value of
the common stock component of the LTIP payout; neither the restricted shares
or the other shares issued at the same time may be transferred for four
years, at which time the restrictions lapse. Dividends are paid on
restricted stock.
The Company's Voluntary Non-Qualified Deferred Compensation Plan, approved
by stockholders in 1995, provides that executives whose total annual cash
compensation exceeds $150,000 may elect to defer up to 25% of his or her salary
and up to 100% of his or her short-term compensation and to allocate the
deferral to a cash account ("Cash Account") or an account maintained in shares
of M. A. Hanna Common Stock (the "Stock Account"). Balances in the Cash Account
earn interest quarterly at a rate equal to 125% of the Moody's Corporate Bond
Yield Index. As cash dividends are declared on M. A. Hanna Common Stock, the
executive's Stock Account is credited with additional shares of M. A. Hanna
Common Stock equivalent to cash dividends paid on the balance of shares in the
Stock Account. All deferrals to the Stock Account are "matched" by a 25% premium
in the form of additional shares of M. A. Hanna Common Stock. When the executive
retires, dies or becomes disabled, the full balance in the Cash Account and
Stock Account is distributed to the executive, and if employment terminates for
any other reason, a partial distribution will be made. Messrs. Walker, McGregor,
Schrank and Pyke have elected to participate in the Plan.
Mr. Schrank has an employment agreement with the Company which expires on
September 26, 1996, pursuant to which Mr. Schrank will receive a minimum base
annual salary and will be entitled to receive certain compensation if he is not
retained in certain capacities during the term of the agreement.
The Company has in effect employment agreements with its executive officers,
including the officers named in the compensation table on page 5 (the "Named
Officers"), which become operative only upon a "change in control" of the
Company, as defined in the agreements. The agreements provide that the officers
will remain employed by the Company in their customary positions from the
occurrence of a "change in control" (i) for an initial term of three years
which, unless otherwise elected by either party, is automatically extended for
an additional one-year period on the third anniversary and each anniversary
thereafter or (ii) until normal retirement date, if sooner. During this
employment period the officer will receive a base salary at least equal to the
annual rate in effect at the time of the "change in control", plus any increases
as may be awarded thereafter in accordance with the Company's regular
administrative practices, and a bonus under the Company's pay-for-performance
plan at least equal to the highest annual bonus paid to him under such plan
during the three years preceding the time of the "change in control". In
addition, during this employment period the officer shall be entitled to
continue to participate in all of the Company's benefit programs in which he was
participating at the time of the "change in control".
If the executive officer's employment is terminated for any reason other
than death, disability, retirement or cause during the employment term, the
officer is entitled to receive, as liquidated damages for the breach of
contract, a payment equal to the present value of the sum of the salary and
bonus(es) due to the officer for the remainder of his employment term and is
also entitled to benefits and service credits under the Company's benefit plans
for the remainder of his employment term. The Company is entitled to offset
against amounts due to the officer any compensation payments made to the officer
by another employer under certain conditions. Termination of employment without
cause is defined to include a good faith determination by the officer that due
to changed circumstances significantly affecting his position with the Company
after the "change in control" occurs, he is unable to carry out his duties and
responsibilities.
6
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZED
INDIVIDUAL GRANTS VALUE
- ----------------------------------------------------------------------------------------------------------- AT ANNUAL RATES
PERCENT OF OF STOCK PRICE
TOTAL OPTIONS APPRECIATION
GRANTED TO FOR OPTION TERM
EMPLOYEES IN EXERCISE EXPIRATION ----------------------
NAME GRANTED (#) FISCAL YEAR PRICE ($/SH) DATE 5% ($) 10% ($)
- ----------------------------------------------- -------------- ------------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
M. D. Walker 75,942 27.0% $26.000 1/1/2005 $1,088,593 $2,681,257
D. J. McGregor 40,960 14.6% 26.000 1/1/2005 587,142 1,466,160
D. R. Schrank 17,838 6.3% 26.000 1/1/2005 255,699 629,800
J. S. Pyke, Jr. 9,819 3.5% 26.000 1/1/2005 140,751 346,676
G. W. Henry 9,877 3.5% 26.000 1/1/2005 141,582 348,724
</TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF IN-THE-MONEY
UNEXERCISED OPTIONS OPTIONS AT
AT FY-END (#) FY-END ($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE (#) REALIZED UNEXERCISABLE UNEXERCISABLE (1)
- ----------------------------------------------- ---------------- ---------- ------------------- --------------------
<S> <C> <C> <C> <C>
M. D. Walker 94,500 $1,866,069 208,175/ $ 2,266,672/
194,967 939,300
D. J. McGregor 33,750 640,309 177,900/ 2,200,327/
108,410 540,264
D. R. Schrank 0 0 36,500/ 285,999/
48,088 253,441
J. S. Pyke, Jr. 10,000 190,830 54,250/ 813,177/
20,194 91,623
G. W. Henry 0 0 40,938/ 611,969/
19,814 87,937
</TABLE>
- --------------------------
(1) Based on market value of the Company's Common Stock on December 31, 1995
($28.00 per share) minus the strike price.
LONG-TERM INCENTIVE PLAN AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS UNDER
NON-STOCK PRICE-BASED PLANS
PERFORMANCE ------------------------------------------------
NUMBER OR OTHER THRESHOLD TARGET
OF PERIOD NUMBER OF NUMBER OF
PERFORMANCE UNTIL PERFORMANCE PERFORMANCE MAXIMUM NUMBER OF
SHARE MATURATION SHARE SHARE PERFORMANCE SHARE
NAME UNITS (#) OR PAYOUT UNITS (#) UNITS (#) UNITS (#)
- ----------------------------------------------- -------- ----------- ------------- ---------- -------------------
<S> <C> <C> <C> <C> <C>
M. D. Walker 13,924 3 years 6,962 13,924 27,848
D. J. McGregor 7,510 3 years 3,755 7,510 15,020
D. R. Schrank 3,271 3 years 1,636 3,271 6,542
J. S. Pyke, Jr. 1,800 3 years 900 1,800 3,600
G. W. Henry 1,811 3 years 906 1,811 3,622
</TABLE>
The number of Performance Shares shown in the table above represent
performance shares granted pursuant to the Corporation's 1988 Long-Term
Incentive Plan as amended. Performance Shares represent the right to receive
payments under the plan at the end of the three-year performance period
commencing January 1, 1996. The number of performance shares earned by the Named
Officers at the end of the three-year cycle will be determined by the
Compensation Committee and will be based on achievement against earnings per
share growth and return on shareholder equity measures. If the EPS and ROSE
targets are met, the target number of performance shares will be paid out. If
the results exceed target performance, the number of
7
<PAGE>
performance shares paid will range between the target number and the maximum
number of performance shares shown in the above table. If, on the other hand,
results are less than target performance, the number of performance shares paid
will range between the target number and the threshold number of performance
shares. If performance after the three-year performance period fails to reach
threshold levels, no performance shares will be paid to any of the Named
Officers. Payments will be determined based on the market value of M. A. Hanna
Common stock at the end of the performance period at which time a portion of the
award will be paid in shares of M. A. Hanna stock and a portion in cash.
RETIREMENT BENEFITS
The Salaried Employees Retirement Income Plan ("SERIP") is a
non-contributory pension plan covering all officers and certain other salaried
employees of the Company. In general, employees become covered under SERIP when
they have completed one year of eligibility service and are at least 21 years of
age. Upon reaching the normal retirement date (age 65), each participant in
SERIP generally is entitled to receive monthly for life a basic benefit equal to
the greater of (i) the participant's highest average monthly compensation
(including bonuses and overtime) for 60 consecutive months out of the final 120
months of his or her employment or (ii) 1/12th of the average of his or her
annual compensation (including bonuses and overtime) during any 5 annual periods
in which he or she received the highest compensation included within the final
10 annual periods of his or her employment, which is then multiplied by 2% for
the first 20 years of credited service and 1% for the next 20 years of credited
service. In addition, benefits are provided for early retirement and to
surviving spouses.
The Company has adopted an excess benefits plan to pay retirement benefits
which but for limitations under the Employee Retirement Income Security Act of
1974 and the Internal Revenue Code would have been paid under SERIP. These
benefits will be paid out of the general funds of the Company or trust funds
established for this purpose.
The following table shows estimated annual benefits payable upon retirement
to participants in specified remuneration and years-of-service classifications
under the Company's above-mentioned two pension plans for salaried employees.
Benefits payable under the qualified pension plans are not subject to any
deduction for Social Security benefits.
<TABLE>
<CAPTION>
AVERAGE ANNUAL
COMPENSATION YEARS OF SERVICE AT AGE 65
FOR LAST 5 YEARS ------------------------------------------------
OF EMPLOYMENT 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ---------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$ 300,000 $ 90,000 $120,000 $135,000 $150,000 $165,000
500,000 150,000 200,000 225,000 250,000 275,000
700,000 210,000 280,000 315,000 350,000 385,000
900,000 270,000 360,000 405,000 450,000 495,000
1,100,000 330,000 440,000 495,000 550,000 605,000
</TABLE>
The credited years of service for retirement benefits for Messrs. Henry,
McGregor, Pyke, Schrank and Walker are 20, 7, 27, 2 and 20, respectively.
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
M. A. Hanna's executive compensation program is structured and administered
to drive and incent a level of performance necessary to achieve the Company's
vision, support M. A. Hanna's internal culture and operating environment and
reinforce its human resource management values. The objectives of the executive
compensation program are to:
8
<PAGE>
-Establish a pay-for-performance philosophy and policy that places a
meaningful portion of each executive's compensation at risk with the
stockholders, commensurate with the executive's ability to impact bottom
line results;
-Motivate and incent executives to achieve a level of performance consistent
with the Company's strategic business objectives and reward them for their
achievement;
-Provide total compensation opportunities which are market competitive, are
subject to associated downside risk and offer significant upside
opportunities based on performance, thus allowing M. A. Hanna to compete
for and retain outstanding, talented and highly motivated executives who
are vital to M. A. Hanna's long-term success; and
-Align the interests of executives with the long-term interest of
stockholders through incentive award opportunities that are linked to the
long-term performance of the Company and that result in ownership of M. A.
Hanna Common Stock.
M. A. Hanna's executive compensation program is comprised of three major
components: base salary, annual incentive compensation and long-term incentive
compensation. As an executive's level of responsibility increases, a greater
portion of his or her potential total compensation opportunity is based on
performance incentives (including stock-based awards), and less on salary; this
approach results in greater variability in the individual's actual total cash
compensation level from year to year in response to variations in the Company's
performance.
The executive total compensation program is designed to be competitive with
the total compensation programs of a broad base of industrial companies with
annual sales levels comparable to M. A. Hanna. In order to assess competitive
total compensation programs and establish total compensation opportunities for
M. A. Hanna executives, the Committee receives the advice of an independent
compensation consultant and utilizes data contained in independent compensation
surveys such as the Wyatt Data Services' TOP MANAGEMENT REPORT, the Towers
Perrin COMPENSATION DATA BANK (CASH COMPENSATION AND LONG-TERM INCENTIVE PLAN
SURVEYS), the Conference Board report on TOP EXECUTIVE COMPENSATION and Hewitt's
PROJECT 777 EXECUTIVE COMPENSATION STUDY.
M. A. Hanna's total compensation program is structured to provide total
compensation opportunities that are commensurate with the Company's ability to
demonstrate consistently outstanding performance. In order to drive and reward
for a consistent high level of performance, M. A. Hanna's total compensation
systems are designed to deliver a total compensation opportunity that is above
average. M. A. Hanna targets executive total compensation opportunities for its
executives' outstanding performance at the 65th percentile of total compensation
opportunities afforded to executives performing similar responsibilities in
competitive companies. On the other hand, the total compensation systems are
also designed to be responsive in the event the Company's actual performance
falls below expectations vis-a-vis the annual operating plan and/or industry
comparisons.
BASE SALARIES
M. A. Hanna targets its executives' base salaries to the median, or 50th
percentile, of base salaries reported in the published surveys referenced above
by comparable industrial companies.
The Committee annually reviews the base salaries of executive officers.
Prior to the meeting at which the annual review occurs, the Committee is
furnished with data on the current total compensation and total compensation
history of each executive officer, current survey data for comparable positions
at comparable industrial companies and individual performance appraisal ratings
by the Chief Executive Officer for each executive officer except himself. At the
meeting the Committee reviews all available data and considers adjustments; in
1995 it made selective adjustments in executive officers' salaries.
9
<PAGE>
ANNUAL INCENTIVE COMPENSATION FOR 1995
The Committee approved in February 1996 annual incentive compensation awards
for the executive officers which took into account the Company's financial and
strategic successes in 1995. In a year in which sales in the plastics industry
were essentially flat, the Company grew its revenues 11% over 1994, increased
its earnings from continuing operations 38% and strengthened its balance sheet.
Moreover, it accomplished a number of significant strategic initiatives. The
Committee approved individual awards for executive officers which reflected each
executive's performance for the year and contribution to M. A. Hanna's
achievements in 1995.
1995 LONG-TERM INCENTIVE PLAN AWARDS
Under M. A. Hanna's Long-Term Incentive Plan, which was approved by
stockholders in 1988, the Committee grants stock options and long-term incentive
performance units ("LTIP Units") annually to cover a three-year performance
period. Awards are based on a pay grade level formula which takes into account
relevant long-term award data as reported by a broad base of industrial
companies in the Towers Perrin COMPENSATION DATA BANK LONG-TERM INCENTIVE PLAN
SURVEY, and the recommendations of the independent compensation consultant.
In December 1995 the Committee made grants of non-qualified and incentive
stock options at a purchase price equal to 100% of the fair market value of M.
A. Hanna Common Stock on the grant date and awards of LTIP Units in the form of
Performance Share Units for a three-year performance period starting on January
1, 1996. The Committee will establish target performance measures for compound
annual earnings per share growth and three-year average return on stockholders'
equity to be attained for the performance period, with threshold and maximum
achievement levels.
1995 LONG-TERM INCENTIVE PLAN PAYMENTS
The Committee applied the earnings per share and return on stockholders'
equity performance measures established for the three-year performance period
ending December 31, 1994 against actual performance and determined that
participants had earned a payout of LTIP Units for that performance period at
148% of the target amounts. Taking into account the accomplishment of strategic
objectives over the three-year period which were not reflected in the financial
measures of performance, the Committee exercised its discretion and authorized a
payout at 150% of the target amounts to be made in 1995. As authorized by the
Long-Term Incentive Plan, the Committee elected to make a portion of the payment
to each participant in cash and a portion in shares of M. A. Hanna Common Stock,
and awarded each participant shares of restricted M. A. Hanna Common Stock equal
in value to 25% of the Common Stock portion of the payment. The terms of the
restricted stock require the participant to hold the restricted stock and the
stock issued in partial payment of the LTIP Unit award for four years, at which
time the restrictions lapse.
CHIEF EXECUTIVE OFFICER COMPENSATION
In reviewing Mr. Walker's total compensation opportunity and each component
thereof, the Committee took into account the same Wyatt, Towers Perrin and
Conference Board compensation survey data for comparable companies and Hanna's
financial, strategic and operational performance that it considered in
connection with the other executive officers. The Committee also reviewed Mr.
Walker's total compensation opportunity and incentive compensation awards with
the independent compensation consultant.
In order to maintain Mr. Walker's base salary at the 50th percentile level
of chief executive officers of comparable companies, the Committee approved an
increase of 4.8% in 1995.
The Committee approved an annual incentive compensation award of $540,000
for Mr. Walker for 1995 in recognition that under his leadership M. A. Hanna in
1995 completed its transformation from a natural resources company to a leading
international specialty chemicals company, accomplished nearly all its financial
10
<PAGE>
and strategic goals, strengthened its senior management team and achieved
another year of strong revenue and earnings growth and cash flow generation. M.
A. Hanna's total return to stockholders in 1995 exceeded the 1995 returns of
almost all competitive companies.
Mr. Walker's 1995 Long-Term Incentive awards were made in accordance with
the program guidelines. His 1995 Long-Term Incentive Plan payouts were
calculated in the same way as the payouts to all other participants.
STOCK OWNERSHIP GUIDELINES
Stock ownership guidelines have been established for participants in the
Company's Long-Term Incentive Plan which encourages them to acquire a guideline
value of M. A. Hanna Common Stock. The guideline values are expressed as a
multiple of base salary and the multiples range from three times base salary for
the Chief Executive Officer and Chief Operating Officer to .5 times salary for
the non-officer, key manager participants in the Plan. Under the policy there
will be no penalty for failure to achieve the expected levels of ownership but
if a participant does not hold the guideline value of M. A. Hanna Common Stock
at the end of a three year period, up to one-half of his or her annual incentive
compensation award will be paid in shares of M. A. Hanna Common Stock until the
expected stock ownership value is achieved.
DEDUCTIBILITY OF EXECUTIVE COMPENSATION
Internal Revenue Code Section 162 (m) and proposed regulations thereunder
respecting the non-deductibility of certain executive compensation payments in
excess of $1 million did not affect the deductibility of compensation payments
in 1995 and are not expected to affect the deductibility of compensation
payments in 1996. Under the Voluntary Non-Qualified Deferred Compensation Plan
approved by stockholders in 1995, the M. A. Hanna executives to whom Section 162
(m) may apply have elected to defer a portion of their compensation pursuant to
the Plan and receive the deferred amounts after retirement, at which time the
deductibility of such compensation will not be subject to Section 162 (m). In
addition, the executives to whom Section 162 (m) may apply have entered into
agreements with the Company by which any compensation which, if paid, would not
be deductible under Section 162 (m), will be deferred and paid after retirement.
COMPENSATION COMMITTEE
M. L. Mann, Chairman
B. C. Ames
J. T. Eyton
R. W. Pogue
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
There are no Compensation Committee interlocks or insider participation.
11
<PAGE>
PERFORMANCE GRAPH
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
AMONG HANNA, S&P 500 INDEX AND S&P SPECIALTY CHEMICALS INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
HANNA (MA) CO S&P 500 INDEX S&P CHEMICALS (SPECIALTY)
<S> <C> <C> <C>
12/90 100 100 100
12/91 107 130 141
12/92 158 140 150
12/93 183 155 171
12/94 204 157 149
12/95 245 215 198
</TABLE>
This performance graph assumes that the value of the investment in Hanna and
each index was $100 on December 31, 1990 and that all dividends were reinvested.
DIRECTORS' COMPENSATION
Directors who are not full-time employees of the Company are compensated for
their services by payment of a quarterly retainer fee of $6,000 and a fee of
$1,300 for each Board meeting attended. They also receive a fee of $1,100 for
each committee meeting attended when the meeting occurs on the same day as a
Board meeting and $1,500 when the meeting occurs on a day when no Board meeting
is held; Chairs of Board committees are paid an additional fee of $200 for each
committee meeting attended. Executive Committee members who are not full-time
employees of the Company are paid an additional quarterly retainer fee of
$1,250. Directors who are also full-time employees of the Company are not
compensated for their services as directors and members of Board committees.
Under the Directors' Deferred Fee Plan, which was approved by stockholders,
non-employee directors are required to defer a minimum of 25% of their quarterly
Board retainer fee into a Deferred Benefit Account maintained in Units, which
are accounting units equal in value to one share of M. A. Hanna Common Stock.
Directors may also elect to defer the balance of his or her retainer fees and
meeting fees to the Units account or a cash account. The Units account is
credited with additional units equal in value to cash dividends paid on the
Common Stock equivalent to the balance of units in the Unit account and the cash
account is credited with interest equal to interest payable on 1-year U.S.
Treasury bills. Each Deferred Benefit Account maintained in Units is credited
after the end of each year with additional units equal in value to 25% of the
value of the units credited to each Deferred Benefit Account during the year.
The Deferred Benefits Accounts are paid to
12
<PAGE>
Directors at the termination of their service or, at the director's election, at
his or her death. As of January 1, 1996, the balance of Units held by
non-employee directors in their Deferred Benefits Accounts maintained in Units,
including the additional units credited to the account at the end of the year
with respect the units credited during 1995, were as follows: B. C. Ames --
3,156.7; C. A. Cartwright -- 224.16; W. R. Embry -- 299.3; J. T. Eyton --
1,385.1; G. D. Kirkham -- 299.3; M. L. Mann -- 3,303.3; and R. W. Pogue --
299.3.
Pursuant to amendments to the 1988 Long Term Incentive Plan adopted in 1991,
one-time grants of options to purchase 15,000 shares of the Company's Common
Stock were granted in 1991 to all non-employee directors then in office and
thereafter to non-employee directors at the time of their election to the Board
at an option price equal to the closing sale price of the Common Stock on the
New York Stock Exchange on the date of grant. One-third of the grant becomes
exercisable after the director has served for one year from the date of grant,
an additional one-third after two years and the balance after three years of
service.
The Company's non-qualified retirement plan for its non-employee directors
provides an annual retirement benefit in an amount equal to the highest annual
retainer fee in effect during the director's final five years of service. Each
qualifying director is entitled to receive, upon retirement as a director, a
quarterly benefit for a period equal to his or her years of service, ten years
or his or her date of death, whichever first occurs. A minimum of five years of
service is required in order to receive a benefit under this program.
2. RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors delegated its authority to select and appoint the
Company's independent public accountants to the Audit Committee of the Board,
which selected and appointed Price Waterhouse LLP to be the Company's
independent public accountants for the year 1996, subject to ratification by the
stockholders. The Audit Committee considers Price Waterhouse LLP to be well
qualified.
If the appointment is not ratified, the Audit Committee will reconsider its
decision but will not be bound by the refusal of the stockholders to ratify the
appointment of Price Waterhouse LLP. A representative of Price Waterhouse LLP is
expected to be present at the annual meeting, will have an opportunity to make a
statement if such representative desires to do so and is expected to be
available to respond to appropriate questions. THE AUDIT COMMITTEE OF THE BOARD
OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR RATIFICATION OF THE
APPOINTMENT OF PRICE WATERHOUSE LLP AS THE COMPANY'S INDEPENDENT PUBLIC
ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 1996.
3. PROPOSED AMENDMENT TO AMENDED CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK
The Company's Board of Directors has adopted resolutions recommending that
the stockholders adopt an amendment to Article Fourth of the Company's Amended
Certificate of Incorporation in order to increase the authorized number of
shares of the Company's Common Stock from 50,000,000 to 100,000,000, increasing
the overall authorized number of shares from 55,000,000 to 105,000,000,
including both the Common Stock and Serial Preference Stock. The text of the
proposed amendment is as follows:
RESOLVED, That the first sentence of Article FOURTH of the Amended
Certificate of Incorporation be amended in its entirety to read as
follows:
FOURTH: The total number of shares of stock which the Corporation shall
have authority to issue is 105,000,000, consisting of 5,000,000 shares of
Preferred Stock without par value (hereinafter called "Serial Preference
Stock"), and 100,000,000 shares of Common Stock, par value $1 each
(hereinafter called "Common Stock").
Other than the proposed change described above, the Company's Amended
Certificate of Incorporation will remain identical in all respects.
13
<PAGE>
The Company is presently authorized to issue 50,000,000 shares of Common
Stock, of which 34,726,438 shares were issued and outstanding on March 5, 1996
and an additional 8,579,234 shares were held in the Company's treasury. In 1995
in connection with a three-for-two split of Common Stock, the Company issued
14,322,624 shares of Common Stock. A total of 1,081,359 shares of Common Stock
are currently reserved for issuance to participants upon exercise of options
granted under the Company's 1979 Executive Incentive Compensation Plan and 1988
Long-Term Incentive Plan as amended (the "Incentive Plans"), and 791,370 shares
are reserved for future grants under the 1988 Long-Term Incentive Plan as
amended. As a result of the stock split and the reserved shares, the Company has
a limited number of authorized, unissued and unreserved shares of Common Stock
available for future issuance.
An increase in the number of authorized shares of Common Stock would permit
the Board of Directors to issue additional shares of Common Stock without
further action by the stockholders, unless such action is required by applicable
law or the rules of any stock exchange on which the Company's securities may be
listed. Except for the shares reserved for issuance under the Incentive Plans,
there are no present plans, understandings or agreements with respect to the
issuance of any additional shares of Common Stock. The Board of Directors
believes it is desirable that the Company have the flexibility to issue shares
in connection with possible future actions, such as stock splits, stock
dividends, financings, corporate mergers, acquisitions of assets, employee
benefit plans and for other corporate purposes. It is possible that additional
shares of Common Stock could be issued at such times and under such
circumstances as to result in the dilution of the equity and earnings
attributable to present holders of Common Stock. However, these factors would be
carefully considered by the Board of Directors before any such issuance was
authorized.
Approval of the proposed amendment could enable the Board to render more
difficult or discourage an attempt to obtain control of the Company. For
example, the issuance of shares of Common Stock in a public or private sale,
merger or similar transaction would increase the number of outstanding shares,
thereby possibly diluting the interest of a party attempting to gain control of
the Company. Availability as a defensive response to a takeover attempt was not
a motivating factor in the Board's approval of the proposed amendment. The
Company is not aware of any pending or threatened efforts to obtain control of
the Company.
APPROVAL BY THE STOCKHOLDERS
The affirmative vote of a majority of the outstanding shares of Common Stock
of the Company entitled to vote at the annual meeting of stockholders is
required for approval of the proposed amendment. If the proposed amendment is
adopted by the stockholders, it will become effective upon filing and recording
a Certificate of Amendment a required by the General Corporation Law of
Delaware.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO AMEND ARTICLE
FOURTH OF THE AMENDED CERTIFICATE OF INCORPORATION TO INCREASE THE AUTHORIZED
NUMBER OF SHARES OF COMMON STOCK.
SECTION 16(a) REPORTING
As required by the Securities and Exchange Commission rules under Section 16
of the Securities and Exchange Act of 1934, the Company notes that during 1995
Mr. L.L. Beach, Vice President -- Human Resources, filed late a Form 4 reporting
an award of restricted Common Stock. Officers deferring salary to the Stock
Account under the Voluntary Non-Qualified Deferred Compensation Plan described
on page 6 did not report the deferrals until the end of the year, which may have
constituted late reporting under the Section 16(a) reporting requirements.
SUBMISSION OF SHAREHOLDER PROPOSALS
If a holder of the Company's Common Stock wishes to present a proposal for
consideration at next year's annual meeting, any such proposal must be received
at the Company's offices at Suite 36-5000, 200 Public Square, Cleveland, Ohio
44114-2304, Attention: Corporate Secretary, on or before November 5, 1996.
14
<PAGE>
The management knows of no other matters which are likely to be brought
before the meeting, but if any such matters properly come before the meeting the
persons named in the enclosed proxy, or their substitutes, will vote the proxy
in accordance with their best judgment.
JOHN S. PYKE, JR.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
March 20, 1996
15
<PAGE>
M.A. HANNA COMPANY
Suite 36-5000, 200 Public Square
Cleveland Ohio 44114-2304
Annual Meeting--May 1, 1996
PROXY
The undersigned hereby appoints M. D. Walker, D. J. McGregor, and J. S. Pyke,
Jr. as Proxies, each with the power to appoint his substitute, and hereby
aurhorizes them to represent and to vote, as designated below, all the shares of
Common Stock of M. A. Hanna Company held on record by the undersigned on
March 5, 1996 at the annual meeting of stockholders to be held on May 1, 1996
and any adjournment thereof.
Election of Directors:
Nominees: B. C. Ames, C. A. Cartwright, W. R. Embry,
J. T. Eyton, G. D. Kirkham, M. L. Mann,
D. J. McGregor, R. W. Pogue, M. D. Walker
(change of address)
-------------------
-------------------
-------------------
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 the election of directors nominated by the Board of Directors, ratification
of the appointment of auditors and approval of the proposed amendment to the
Corporation's Amended Certificate of Incorporation to increase the Corporation's
authorized Common Stock from 50,000,000 to 100,000,000 shares.
Please sign exactly as the name appears on reverse side. When shares are held by
joint tenants, both should sign. When signing as an 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
This proxy is solicited on behalf of the Board of Directors.
NO.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
SEE REVERSE SIDE
<PAGE>
/X/ Please mark your votes as in this example.
SHARES IN YOUR NAME
REINVESTMENT SHARES
1. Election of Directors FOR WITHHELD
(see reverse) / / / /
For, except vote withheld from the following nominee(s):
________________________________________________________
2. Ratification of FOR AGAINST ABSTAIN
appointment of / / / / / /
auditors.
3. Ratification and approval of FOR AGAINST ABSTAIN
amendment to increase / / / / / /
authorized Common Stock.
4. Upon such other FOR AGAINST ABSTAIN
business as may properly come / / / / / /
before the meeting.
Change
of
Address
SIGNATURE(S) ______________________________________________ DATE __________
SIGNATURE(S) ______________________________________________ DATE __________
NOTE: Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
