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 [ ] 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 Rule 14a-11(c) or Rule 14a-12
Ingersoll-Rand Company
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing 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),
or 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3)
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee Paid:
$125.00
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
<PAGE>
[INGERSOLL-RAND BOLD TYPEFACE] World Headquarters
-----------------------------------
Ingersoll-Rand Company
Woodcliff Lake, New Jersey
07675-8738
NOTICE OF 1996 ANNUAL MEETING OF SHAREHOLDERS
The Annual Meeting of Shareholders of Ingersoll-Rand Company will be held on
Friday, April 26, 1996, at 10:30 a.m., local time, at the Company's executive
offices, 200 Chestnut Ridge Road, Woodcliff Lake, New Jersey for the following
purposes:
(1) To elect three directors of the Third Class to hold office for three
years.
(2) To ratify the appointment of Price Waterhouse LLP as independent
accountants of the Company for 1996.
(3) To transact such other business as may be incident to or properly
come before the Annual Meeting or any adjournments thereof.
The transfer books will not be closed, but only shareholders of record at
the close of business on February 29, 1996 are entitled to notice of and to vote
at the Annual Meeting.
A map showing the location of the Company's executive offices, as well as
necessary travel information, follows this Notice and Proxy Statement.
You are requested to vote, date and sign the enclosed proxy and return it in
the enclosed envelope at your earliest convenience. Since it is impractical to
eliminate duplication, separate proxies are mailed to persons whose names are
shown in more than one way on the Company's stock records. Therefore, you may
receive more than one proxy. PLEASE VOTE, DATE, SIGN AND RETURN ALL PROXIES
RECEIVED.
Shares held for the account of shareholders participating in the Company's
Automatic Dividend Reinvestment and Cash Payment Plan will be voted by such
Plan's administrator in the same manner as directed on the enclosed proxy. If a
shareholder participating in the Automatic Dividend Reinvestment and Cash
Payment Plan does not return a proxy, the shares held for such shareholder's
account in such Plan will not be voted.
By Order of the Board of Directors,
R.G. Heller,
Secretary
Dated: March 13, 1996
<PAGE>
INGERSOLL-RAND COMPANY
P.O. BOX 8738
WOODCLIFF LAKE, NEW JERSEY 07675
PROXY STATEMENT
1996 ANNUAL MEETING OF SHAREHOLDERS
The enclosed proxy is solicited by the Board of Directors of the Company in
connection with the Annual Meeting to be held on April 26, 1996. It and this
Proxy Statement are being sent to shareholders beginning on or about March 13,
1996. Proxies in the accompanying form which are properly executed and received
by the Secretary prior to the Annual Meeting will be voted. The Company has
retained Georgeson & Co. to assist in the solicitation of proxies personally and
by telephone at a cost of $10,000 plus expenses. In addition, certain officers
and other employees of the Company, without extra remuneration, may assist in
the solicitation. The cost of solicitation will be borne by the Company.
REVOCABILITY OF PROXY
A shareholder giving the enclosed proxy has the power to revoke it at any
time before it is exercised and may do so by written notice to the Secretary of
the Company at the address set forth above, effective upon receipt of such
written notice, or by voting in person at the Annual Meeting. Attendance at the
Annual Meeting, in and of itself, will not constitute revocation of a proxy.
VOTING SECURITIES
The record date for the determination of shareholders entitled to vote at
the Annual Meeting is the close of business on February 29, 1996. There were
outstanding and entitled to vote on such date 109,030,886 shares of Common
Stock, each of which is entitled to one vote.
In voting for the election of directors, shareholders have cumulative voting
rights. Accordingly, each shareholder may cumulate such voting power as such
shareholder possesses and give one candidate a number of votes equal to the
number of directors to be elected multiplied by the number of such shareholder's
votes, or distribute such shareholder's votes on the same principle among two or
more candidates, as such shareholder sees fit. The enclosed proxy grants
discretionary authority for the exercise of such cumulative voting rights.
The affirmative vote of the holders of a plurality of votes cast at the
Annual Meeting will be required to elect directors. The affirmative vote of the
holders of a majority of the votes cast will be required to act on all other
matters to come before the Annual Meeting.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the inspectors of election appointed for the meeting, who will also determine
whether or not a quorum is present. The inspectors of election will treat
abstentions, as well as shares represented by proxies submitted by brokers who
indicate that they do not have authority to vote on a particular matter, as
shares that are present for purposes of determining the presence of a quorum,
but as unvoted (i.e., not cast) for purposes of determining the approval of the
particular matter in question.
1. ELECTION OF DIRECTORS
It is intended that the proxies will be voted for the election of H. William
Lichtenberger, James E. Perrella and John E. Phipps as directors of the Third
Class for a term of three years. If, for reasons not now known, any of said
nominees is not a candidate when the Annual Meeting takes place, it is intended
that such proxies will be voted for the election of the other nominees named and
may be voted for any
<PAGE>
substitute nominees. The proxies may be voted cumulatively for less than the
entire number of nominees if any situation arises which, in the opinion of the
proxyholders, makes such action necessary or desirable.
Information with respect to each nominee and each director whose term of
office will continue after the Annual Meeting is as follows:
THEODORE H. BLACK
Mr. Black retired in 1993 as Chairman and Chief Executive Officer of the
Company, a position he had held from 1988. He served as a Vice President of the
Company from 1972 through 1986, as President and Chief Executive Officer of
Dresser-Rand Company (in which the Company holds a 49% ownership interest) from
1987 until 1988 and as President of the Company from 1988 to 1992. He is also a
director of CPC International, Inc., General Public Utilities Corporation and
McDermott International, Inc. Mr. Black, who is 67 years old, became a director
of the Company in 1988. His current term expires in 1997.
BRENDAN T. BYRNE
Mr. Byrne has been a member of the law firm of Carella, Byrne, Bain,
Gilfillan, Cecchi, Stewart and Olstein since 1982. He served as Governor of New
Jersey from 1974 to 1982. He is also a director of Cali Realty Corporation,
Chelsea GCA Realty, Inc. and Elizabethtown Water Co. Mr. Byrne, who is 71 years
old, became a director of the Company in 1988. His current term expires in 1998.
Member of Audit, Corporate Affairs and Finance Committees.
JOSEPH P. FLANNERY
Mr. Flannery has been Chairman, President and Chief Executive Officer of
Uniroyal Holding, Inc., a holding company, since 1986. He was also a partner in
Clayton & Dubilier, an investment firm, from 1988 to 1990. Mr. Flannery served
as Chairman, President and Chief Executive Officer of Uniroyal, Inc., a
manufacturer of chemicals, tires, engineered products and leisure products, from
1982 to 1986. He is also a director of APS, Inc., Arvin Industries, Inc., K Mart
Corporation, Newmont Gold Company, Newmont Mining Corporation and The Scotts
Company. Mr. Flannery, who is 63 years old, became a director of the Company in
1986. His current term expires in 1997. Member of Audit and Compensation and
Nominating Committees.
CONSTANCE J. HORNER
Mrs. Horner has been a Guest Scholar at The Brookings Institution since
1993. She served at the White House as Assistant to the President and Director
of Presidential Personnel from 1991 to 1993, and as Deputy Secretary, U.S.
Department of Health and Human Services from 1989 to 1991. She is also a
director of Pfizer Inc. and The Prudential Insurance Company of America. Mrs.
Horner, who is 54 years old, became a director of the Company in 1994. Her
current term expires in 1998. Member of Corporate Affairs and Finance
Committees.
H. WILLIAM LICHTENBERGER
Mr. Lichtenberger has been Chairman and Chief Executive Officer of Praxair,
Inc., an industrial gases company, since 1992. He previously served as a Vice
President of Union Carbide Corporation ("Union Carbide") from 1986 to 1990, and
as the President and Chief Operating Officer of Union Carbide from 1990 until
his resignation in 1992 in connection with the spinoff of Praxair, Inc. from
Union Carbide. He is also a director of Olin Corporation. Mr. Lichtenberger, who
is 60 years old,
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became a director of the Company in 1995. He is a candidate for a three-year
term. Member of the Audit and Compensation and Nominating Committees.
JAMES E. PERRELLA
Mr. Perrella has been Chairman and Chief Executive Officer of the Company
since 1993. He has also served as President of the Company since 1992, prior to
which he served as an Executive Vice President of the Company. He is also a
director of Becton Dickinson and Company and Cincinnati Milacron, Inc. Mr.
Perrella, who is 60 years old, became a director of the Company in 1992. He is a
candidate for a three-year term.
JOHN E. PHIPPS
Mr. Phipps has been a private investor for many years. He is also a director
of Essex Corp. and W.R. Grace & Co. Mr. Phipps, who is 63 years old, became a
director of the Company in 1970. He is a candidate for a three-year term. Member
of Corporate Affairs and Finance Committees.
CEDRIC E. RITCHIE
Mr. Ritchie was Chairman of the Executive Committee of The Bank of Nova
Scotia from 1993 to 1995 and has served as a director of The Bank of Nova Scotia
for many years. He served as Chairman of the Board of The Bank of Nova Scotia
from 1974 until 1995 and as its Chief Executive Officer from 1974 until 1993. He
is also a director of J. Ray McDermott S.A., MacMillan Bloedel Limited, Minorco,
Moore Corporation Limited and Nova Corporation of Alberta. Mr. Ritchie, who is
68 years old, became a director of the Company in 1987. His current term expires
in 1997. Member of Compensation and Nominating and Finance Committees.
ORIN R. SMITH
Mr. Smith has been Chairman and Chief Executive Officer of Engelhard
Corporation, a provider of specialty chemical products, engineered materials and
precious metals management services for various industries, since 1995. He
previously served as President and Chief Executive Officer and a director of
Engelhard Corporation from 1984 to 1995. He is also a director of Louisiana Land
& Exploration Company, Minorco, Perkin-Elmer Corporation, The Summit
Bancorporation and Vulcan Materials Company. Mr. Smith, who is 60 years old,
became a director of the Company in 1995. His current term expires in 1998. He
is a member of the Compensation and Nominating and Corporate Affairs Committees.
RICHARD J. SWIFT
Mr. Swift has been Chairman, President and Chief Executive Officer of Foster
Wheeler Corporation, a provider of design, engineering, construction,
manufacturing, management and environmental services, since 1994. He held
several executive positions with Foster Wheeler Corporation, including serving
as its President and Chief Operating Officer from 1992 to 1994. He is also a
director of Public Service Enterprise Group Incorporated. Mr. Swift, who is 51
years old, became a director of the Company in 1995. His current term expires in
1997. He is a member of the Audit and Finance Committees.
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SECURITY OWNERSHIP OF MANAGEMENT AND
CERTAIN BENEFICIAL OWNERS
The following table sets forth as of February 29, 1996, the beneficial
ownership of the Company's Common Stock by (i) each of the directors of the
Company, (ii) each of the executive officers of the Company named in the Summary
Compensation Table below, and (iii) all directors and executive officers of the
Company as a group:
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED AND
NAME NATURE OF BENEFICIAL OWNERSHIP (A)
---- ----------------------------------
<S> <C>
T.H. Black..................................... 94,166(b)(c)
B.T. Byrne..................................... 400
J.P. Flannery.................................. 1,000
C.J. Horner.................................... 513
H.W. Lichtenberger............................. 1,000
T.F. McBride................................... 66,822(b)
A.M. Nixon..................................... 41,243(b)
J.E. Perrella.................................. 346,144(b)(d)
J.E. Phipps.................................... 500
C.E. Ritchie................................... 400
O.R. Smith..................................... 1,000
R.J. Swift..................................... 500
J.F. Travis.................................... 219,080(b)(e)
R.B. Uber...................................... 35,116(b)
All directors and executive officers as a group
(26 persons)................................. 1,535,473(b)(f)
</TABLE>
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<TABLE>
<S> <C>
(a) Unless otherwise indicated, all shares are held directly. No director or executive
officer of the Company owns as much as 1% of the outstanding Common Stock.
(b) Includes shares held by the trustee under the Company's Leveraged Employee Stock
Ownership Plan, Savings and Stock Investment Plan and Retirement Account Plan for the
benefit of executive officers as follows: T.F. McBride, 7,478 shares; A.M. Nixon, 6,552
shares; J.E. Perrella, 28,648 shares; J.F Travis, 14,980 shares; R.B. Uber, 5,321
shares; and all executive officers as a group, 111,880 shares. Also included are shares
which executive officers and Mr. Black (who previously had served as the Company's
Chairman and Chief Executive Officer) had the present right to acquire under the
Company's Incentive Stock Plans as follows: T.H. Black, 50,000 shares; T.F. McBride,
20,000 shares; A.M. Nixon, 30,000 shares; J.E. Perrella, 250,000 shares; J.F. Travis,
180,000 shares; R.B. Uber, 24,000 shares; and all directors and executive officers as a
group, 1,090,500 shares.
(c) Includes 13,500 shares of Common Stock owned by Mr. Black's wife and Mr. Black
disclaims beneficial ownership of such shares.
(d) Includes 7,800 shares of Common Stock owned by a family foundation of which Mr.
Perrella and his wife are the trustees and Mr. Perrella disclaims beneficial ownership
of such shares.
(e) Includes an aggregate of 3,000 shares owned by members of Mr. Travis' family and Mr.
Travis disclaims beneficial ownership of all such shares.
(f) All directors and executive officers as a group beneficially owned approximately 1.39%
of the outstanding Common Stock. This includes an aggregate of 25,588 shares of Common
Stock owned by members of the families of such individuals or by a family foundation,
as to which such directors and executive officers disclaim beneficial ownership.
</TABLE>
4
<PAGE>
The following table sets forth each shareholder which, as of February 29,
1996, is known by the Company to be the beneficial owner of more than five
percent of the outstanding Common Stock of the Company:
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE
OF OF
BENEFICIAL OWNERSHIP BENEFICIAL OWNERSHIP PERCENT OF CLASS
--------------------- -------------------- ----------------
<S> <C> <C>
Chase Manhattan Bank, N.A................................ 8,299,506(a) 7.61%
4 Chase Metro Tech Center
Brooklyn, New York 11245
FMR Corp................................................. 13,970,953(b) 12.81%
82 Devonshire Street
Boston, Massachusetts 02109
</TABLE>
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(a) These shares are held in Chase Manhattan Bank's capacity as trustee of the
Company's Leveraged Employee Stock Ownership Plan, Savings and Stock
Investment Plan and Retirement Account Plan for the benefit of participants
in such plans.
(b) FMR has sole investment power as to all such shares. In addition, as to
961,101 of these shares, FMR Corp. has sole voting power.
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors held 13 meetings during 1995. Each incumbent director
attended 75% or more of the total number of meetings of the Board and the
Committees of which he or she was a member.
Directors who are not employees of the Company receive an annual retainer of
$27,000, and $1,000 for attendance at each Board or Committee meeting, except
that Committee chairmen receive $1,500 per Committee meeting. In addition, under
the Company's Incentive Stock Plan of 1995, each non-employee director is
granted annually options to purchase 1,500 shares of the Company's Common Stock.
A director who is not a participant in any of the Company's other retirement
plans and who retires as a director with ten or more years of service will
receive annually commencing at age 70 for the remainder of such individual's
life a fee equal to the annual retainer in effect as of the date of such
individual's retirement. A pro rata amount of such annual retainer will be paid
if such director's service is between five and ten years.
The Audit Committee held four meetings during 1995. The functions of this
Committee are to recommend to the Board the public accounting firm to be
appointed the Company's independent auditors, to review the scope of the audit
and the findings of the independent auditors, to review with Company officers
the internal audit department activities and any actions taken in response to
recommendations of the independent auditors, to make appropriate periodic
reports to the Board relating to the Committee's activities and to render such
advice and recommendations in connection with the foregoing matters as it deems
necessary.
The Compensation and Nominating Committee held four meetings during 1995.
The functions of this Committee are to establish the Company's executive
compensation policies, to review the compensation of officers and key employees,
to recommend or approve changes in compensation within the limits of the
Committee's authority, to review and recommend changes in the Company's employee
benefit programs and management succession plans and to recommend to the Board
nominees for election as directors and officers and for appointment to the
committees of the Board. The Committee also administers and supervises the
Company's Incentive Stock Plans and the Management Incentive Unit Plan.
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While the Compensation and Nominating Committee does not actively solicit
names of candidates for nomination to the Board, it will review and consider any
proposed nominations submitted in writing by the shareholders of the Company.
Shareholders may submit such recommendations to the Secretary of the Company.
The Corporate Affairs Committee held two meetings during 1995. The functions
of this Committee are to review the Company's policies on public issues having
broad social significance, the implementation of those policies, and the
Company's conduct of its business as a responsible corporate citizen.
The Finance Committee held four meetings during 1995. The functions of this
Committee are to direct the investment policies of all retirement plans of the
Company and its subsidiaries (including the Company's Savings and Stock
Investment Plan), and to review the Company's annual finance plan, proposed
borrowings and securities issuances, and dividend and cash management policies.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION AND NOMINATING COMMITTEE
The Company's executive compensation program is administered by the
Compensation and Nominating Committee of the Board of Directors (the
"Compensation Committee"), which is composed of the individuals listed below,
each of whom is an independent non-employee director. The Compensation Committee
has responsibility for the Company's executive officer compensation program,
including the approval of salary increases and annual bonuses, and the granting
of stock options (and associated stock appreciation rights), stock awards and
Management Incentive Units ("MIUs"), in accordance with the terms of the
respective plans governing such grants, to executive officers who are not also
directors of the Company. It also has responsibility for making recommendations
to the members of the Board of Directors who have not participated in the
executive compensation program regarding salary increases, the payment of annual
bonuses, and the granting of stock options (and associated stock appreciation
rights), stock awards and MIUs to executive officers who also are directors of
the Company.
Compensation Policies Applicable to Executive Officers
The Compensation Committee's executive officer compensation policies are
based on the belief that the interests of the Company's executive officers
should be aligned with those of the Company's shareholders. The policies relate
compensation to both short-term (annual) and long-term financial performance of
the Company, as well as to long-term shareholder returns, and incorporate a
pay-at-risk component to achieve these ends.
The objectives which guide policy development are to (a) provide a total
compensation package that will attract, motivate and retain as senior management
exceptionally talented individuals who are essential for building shareholder
value on a long-term basis, (b) establish annual incentives for senior
management that are directly tied to the overall financial performance of the
Company, and (c) create long-term incentives to focus executives on managing
from the viewpoint of an owner with an equity stake in the business, thereby
aligning executive compensation with the values realized by the Company's
shareholders. While many compensation determinations are based upon objective
criteria, certain of such determinations include subjective elements.
The Compensation Committee periodically reviews and evaluates its executive
officer compensation practices against the practices of approximately 100
industrial and service companies with annual revenues in the $3 billion to $6
billion range, using survey data compiled and analyzed by an outside consulting
firm engaged by the Compensation Committee. Data from other compensation surveys
is also considered. The companies included in these compensation surveys are not
the same as those comprising the Standard & Poor's Machinery-Diversified Index
referred to below under the caption "Performance
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Graph," although some of the companies comprising such Index are included in the
compensation surveys.
Salary increases normally are granted annually to executive officers by the
Compensation Committee based upon individual performance, the Compensation
Committee's evaluation of general U.S. industry salary trends derived from
surveys and various business publications and the salaries paid for comparable
positions in the surveyed corporations referred to above. Weighting of these
salary determination factors varies because each salary determination is based
upon an individual's particular circumstances.
Executive officers with direct responsibility for operations may receive
annual bonuses under the terms of written performance agreements established
early each year. The agreements for 1995 provided that a bonus equal to 30-40%
of salary would be payable if their respective group operations met certain
pre-established operating income and asset management targets, and an additional
40-50% of salary (to a maximum of 80% of salary) would be payable for
substantially exceeding those targets. In addition, a discretionary bonus of up
to 20% of salary would be payable based upon subjective criteria applicable to
the respective operations managed by these executive officers. The total bonus
could be increased by up to 25% based on the Company's achievement of a
pre-established earnings per share objective during the particular year.
Other executive officers, including those responsible for staff functions,
may receive annual bonuses based upon both the Company's and their individual
performance during such year. The determination of the amount of any bonus
payable to these other executive officers is subjective. In fixing such bonus
awards, the Compensation Committee considers not only the Company's earnings per
share performance in the particular year compared to the preceding year and to
the earnings per share goal established at the start of the particular year, but
also the individual's contribution to such performance. In addition, the general
economic environment in which the Company operated during such year is taken
into account.
The Company's Senior Executive Performance Plan (the "SEPP"), limits the
bonuses which may be awarded to participants in the SEPP, who consist of the
chief executive officer plus the four other highest compensated officers (as
determined under Securities Exchange Act regulations). Bonuses to SEPP
participants are limited to their respective allocated shares of the SEPP's
Performance Bonus Pool for the year in question.
The Company's executive officer compensation program provides for a
substantial component of total executive officer compensation to reflect the
returns realized by shareholders and the degree to which future performance
targets are met. This equates the long-term interests of the Company's executive
officers with those of the Company's shareholders and is accomplished through
the following long-term incentive programs:
(a) Stock options with tandem stock appreciation rights under the
Company's Incentive Stock Plans generally have been granted annually at an
exercise price equal to the fair market value of the Company's Common Stock
on the date of grant, and are exercisable over the period beginning one year
from the date of grant until the tenth anniversary of the grant.
(b) Stock awards payable in the Company's Common Stock periodically have
been granted under the Company's Incentive Stock Plans to executive officers
and other key employees of the Company. Awards to executive officers
normally are distributed upon vesting in three annual installments and are
conditioned on continued employment with the Company. The stock awards
provide that one-half of each award will be paid only in the event the
Company achieves predetermined earnings per share objectives during the
installment payout period. The objective for each year is established early
in the year by the members of the Board of Directors who do not participate
in the compensation program. In the event such earnings per share objectives
are not
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met, payouts are made only at the discretion of the members of the Board of
Directors who do not participate in the executive compensation program.
(c) MIUs under the Management Incentive Unit Plan (the "MIU Plan") have
been granted to executive officers during the course of their employment
with the Company. This program recognizes the performance of individuals who
have a high potential for growth in the future management of the Company.
The number of MIUs granted to a particular individual is based upon the
position responsibility of such individual within the Company, such
individual's tenure in such position and with the Company, and an evaluation
of the potential of such individual for future growth. Weighting of the
factors used in determining MIU grants varies because each grant is based
upon an individual's particular circumstances. Under the MIU Plan, when cash
dividends are paid on the Company's Common Stock, a participant is paid a
cash amount equal to one-half of the dividends such participant would have
received had the participant owned one share of Common Stock for each MIU
granted to the participant. The remaining one-half of each cash dividend is
credited to an account for the participant and is converted into so-called
Common Stock equivalents (i.e., a unit or units equal to the number of
shares of the Company's Common Stock which the cash would have been able to
purchase on the open market, based on the then current per share price).
Dividends are credited on such Common Stock equivalents which also are held
in the participant's MIU account. Amounts credited as Common Stock
equivalents become vested after five years. Common Stock equivalents entitle
the holder to receive upon retirement, as defined in the MIU Plan, cash
equal to the fair market value of one share of Common Stock for each Common
Stock equivalent credited to the participant's account.
The number of stock options and stock awards granted are based upon the
position responsibility of each recipient and the long-term incentive practices
of the surveyed corporations referred to above. These factors are periodically
reevaluated by the Compensation Committee. The Compensation Committee seeks to
provide long-term incentive compensation for a particular position within the
third quartile of practices of the surveyed corporations referred to above for
equivalent positions. The Compensation Committee uses these guidelines in making
its award grant determinations. New awards of both stock options and stock
grants are issued without regard to the options or awards previously granted or
still outstanding.
1995 Chief Executive Officer Compensation
The Compensation Committee recommended (and the Board of Directors approved)
a 14.3% salary increase effective January 1, 1995, and a 14.1% salary increase
effective December 1, 1995, for Mr. Perrella. These increases were granted to
bring Mr. Perrella's salary level to $730,000, which represents the midpoint of
the salary range set for the Company's chief executive officer. The midpoint of
this range approximates the average salaries of the chief executives of the
surveyed corporations referred to above.
In addition, the Compensation Committee recommended that, in accordance with
the SEPP, the Board approve a bonus to Mr. Perrella in respect of 1995 in an
amount equal to 125% of his 1995 year-end salary. This recommendation, as well
as the Board's subsequent award of that bonus, was based upon the Company's 1995
operating results, which exceeded 1994 results as well as the 1995 earnings
goal, and Mr. Perrella's contribution to these results. The bonus award also
recognized Mr. Perrella's efforts towards the Company's successful acquisition
of Clark Equipment Company.
During 1995, Mr. Perrella was also awarded stock options (with associated
stock appreciation rights) in respect of 90,000 shares of the Company's Common
Stock which are exercisable beginning on May 4, 1996, at an exercise price of
$36.13 per share, consistent with the guidelines described above (i.e., based
upon his position responsibility and the long-term incentive practices of the
surveyed corporations referred to above).
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<PAGE>
1995 Compensation of Other Named Executive Officers
During 1995, in accordance with the policies stated above, the executive
officers named in the Summary Compensation Table, other than Mr. Perrella, were
granted salary increases averaging approximately 11.2%. Bonus awards to Messrs.
Travis, Nixon and Uber were granted pursuant to performance agreements of the
type described above. Since in 1995 the groups for which Messrs. Travis, Nixon
and Uber were responsible exceeded their respective operating income and asset
management goals and the Company achieved certain pre-established profit
objectives, these individuals were awarded bonuses averaging approximately 110%
of salary. Mr. McBride, who did not have a performance agreement for 1995, was
awarded a bonus equal to approximately 75% of salary, in line with Company
performance and the evaluation of his individual contributions to the Company's
results. The bonus awards to Messrs. Travis and McBride, which were in
accordance with the SEPP, also took into account their respective contributions
in connection with the Company's acquisition of Clark Equipment Company.
The named executive officers were also granted stock options in respect of
the Company's Common Stock, as indicated in the Summary Compensation Table and
under the captions "Stock Options and Stock Appreciation Rights" and "Long-Term
Incentive Plan Awards," in accordance with the practices referred to above.
Summary
The Compensation Committee believes the compensation program for the
Company's executive officers is competitive with, and falls within the third
quartile relative to, the compensation programs provided to similarly situated
officers in the surveyed corporations. The Compensation Committee believes the
bonus payments made to the executive officers named in the Summary Compensation
Table below in respect of the year 1995 are appropriate and commensurate with
the Company's 1995 financial and strategic performance and their respective
individual achievements during the year. Based on information the Compensation
Committee has been provided by consultants relative to the compensation
practices of surveyed corporations, it believes the stock incentive compensation
opportunities provided to these officers, in the form of stock awards and stock
options with tandem stock appreciation rights, are also appropriate and are
awarded in a manner fully consistent with the Company's strategy of basing a
substantial component of total executive officer compensation on the total
returns realized by the Company's shareholders.
COMPENSATION AND NOMINATING
COMMITTEE
Joseph P. Flannery, Chairman
H. William Lichtenberger
Cedric E. Ritchie
Orin R. Smith
9
<PAGE>
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table shows, for the years ended December 31, 1993, 1994 and
1995, the cash compensation paid by the Company and its subsidiaries, as well as
certain other compensation paid or accrued for those years, to the individuals
named below:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------------
AWARDS
ANNUAL COMPENSATION ------------------------- PAYOUTS
---------------------------------- RESTRICTED SECURITIES --------
NAME AND OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
PRINCIPAL SALARY BONUS COMPENSATION AWARDS OPTIONS/SARS PAYOUTS COMPENSATION
POSITION YEAR ($) ($) ($) ($)(B) (#) ($)(C) (D)
- -------------------- ---- -------- -------- ------------ ---------- ------------ -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
J.E. Perrella....... 1995 $647,500 $913,000 $ 0 $ 24,611 90,000 $123,165 $ 80,983
Chairman of the 1994 545,417 700,000 0 853,136 80,000 325,346 55,249
Board, 1993 433,333 420,000 0 146,652 70,000 194,250 42,879
President and Chief
Executive Officer
J.F. Travis......... 1995 328,833 437,500 0(a) 8,849 40,000 71,138 39,065
Executive Vice 1994 280,000 333,625 0 493,431 40,000 90,900 29,244
President 1993 222,500 237,635 111,571 5,966 30,000 77,700 185,322
T.F. McBride........ 1995 312,500 243,750 0 9,811 40,000 53,861 29,934
Senior Vice 1994 286,667 180,000 0 340,960 35,000 132,941 20,014
President 1993 259,167 125,000 0 7,882 30,000 77,700 17,474
and Chief Financial
Officer
A.M. Nixon.......... 1995 221,083 183,665 0 6,656 24,000 49,458 22,609
Vice President 1994 198,667 204,840 0 92,404 20,000 21,210 21,691
1993 170,500 172,500 0 6,048 15,000 27,195 18,485
R.B. Uber........... 1995 230,000 261,875 0 4,878 25,000 33,875 21,162
Vice President 1994 203,750 138,405 0 189,022 24,000 75,750 14,233
1993 188,917 48,000 0 4,432 24,000 64,750 14,108
</TABLE>
- ------------
(a) These amounts represent that portion of relocation benefit payments to
Mr. Travis which compensated him for the income taxes payable in respect of the
relocation compensation. The relocation benefit amounts are reflected in the
column headed "All Other Compensation."
(b) The amounts reflected as Restricted Stock Awards are composed of (i) the
portion of stock awards granted under the Incentive Stock Plan to be issued
subject to the continuation of employment of the named executives, and (ii) the
crediting of Common Stock equivalents to the accounts of such executives under
the MIU Plan. The 1994 amount for Mr. Travis also includes a stock award granted
in January 1994, which was based upon the performance of the Company in that
year.
The shares issuable after December 31, 1995 to the named executives under
outstanding stock awards which are subject to continued employment and the years
of vesting of such awards are as follows:
<TABLE>
<CAPTION>
YEAR OF VESTING
------------------------
<S> <C> <C> <C>
NAME 1996 1997 1998
---- ----- ----- ------
J.E. Perrella............................................... 4,500 6,750 11,250
J.F. Travis................................................. 2,000 3,000 5,000
T.F. McBride................................................ 1,800 2,700 4,500
A.M. Nixon.................................................. 1,515 2,525 0
R.B. Uber................................................... 1,000 1,500 2,500
</TABLE>
10
<PAGE>
Dividend equivalents are paid in respect of such shares prior to their
vesting. The issuance of the balance of the shares subject to the stock awards
is contingent upon the attainment of earnings per share goals established by the
Board of Directors (see footnote (c) below).
The aggregate number and fair market value as of December 31, 1995 of all
Common Stock equivalents credited to the accounts of the named executives under
the MIU Plan and the shares subject to outstanding stock awards issuable
contingent upon the continued employment of the named executives are as follows:
<TABLE>
<CAPTION>
FAIR MARKET
NAME # SHARES VALUE
---- -------- -----------
<S> <C> <C>
J.E. Perrella................................................. 31,172 $ 1,094,917
J.F. Travis................................................... 13,107 460,383
T.F. McBride.................................................. 13,422 471,448
A.M. Nixon.................................................... 7,146 251,003
R.B. Uber..................................................... 6,673 234,389
</TABLE>
(c) The amounts reflected in this column represent the value of the
performance portion of stock awards distributed to the named executives. The
shares subject to the performance portion of the stock awards are distributable
if the Company achieves earnings per share goals established early each year.
(d) The amounts reflected in this column represent (i) Company contributions
for the account of the named executive officers to the Company's Leveraged
Employee Stock Ownership Plan, Savings Plan and Retirement Account Plan, as well
as amounts credited to the accounts of such executive officers under the related
supplemental plans, which provide benefits which would have been provided under
the applicable tax-qualified plans but for Internal Revenue Code restrictions on
such benefits, (ii) dividend equivalents paid to the named executive officers in
respect of the performance portion of stock awards (see footnote (c) above), and
(iii) for 1993 relocation benefits paid to Mr. Travis. For 1995 such amounts
were as follows:
<TABLE>
<CAPTION>
RETIREMENT
SAVINGS PLAN ACCOUNT PLAN
(INCLUDING (INCLUDING
SUPPLEMENTAL SUPPLEMENTAL
PLAN) PLAN) DIVIDEND
NAME CONTRIBUTIONS CONTRIBUTIONS EQUIVALENTS
---- ------------- ------------- -----------
<S> <C> <C> <C>
J.E. Perrella.................................... $38,600 $25,733 $16,650
J.F. Travis...................................... 18,999 12,666 7,400
T.F. McBride..................................... 13,966 9,308 6,660
A.M. Nixon....................................... 12,220 8,147 2,242
R.B. Uber........................................ 10,477 6,985 3,700
</TABLE>
STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
The following tables contain information for the year 1995 concerning the
grants to, and exercises by, the executive officers named above, of stock
options and tandem stock appreciation rights ("SARs")
11
<PAGE>
under the Incentive Stock Plan of 1995 and the value of such options and rights
held by such executive officers as of December 31, 1995:
OPTION/SAR GRANTS IN 1995
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING % OF TOTAL
OPTIONS/SARS OPTIONS/SARS EXERCISE OR GRANT DATE
GRANTED GRANTED TO BASE EXPIRATION VALUE
NAME (#)(A) EMPLOYEES IN 1995 PRICE($/SH) DATE ($)(B)
---- ------------ ----------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
J.E. Perrella................. 90,000 8.89% $ 36.13 5/2/05 $1,068,300
J.F. Travis................... 40,000 3.95 36.13 5/2/05 474,800
T.F. McBride.................. 40,000 3.95 36.13 5/2/05 474,800
A.M. Nixon.................... 24,000 2.37 36.13 5/2/05 284,880
R.B. Uber..................... 25,000 2.47 36.13 5/2/05 296,750
</TABLE>
- ------------
(a) All options and SARs become fully exercisable on May 3, 1996.
(b) Grant date value is based on the Black-Scholes option pricing model
adapted for use in valuing executive stock options. The actual value, if any, an
executive may realize will depend on the excess of the stock price over the
exercise price on the date the option is exercised, so that there is no
assurance the value realized by an executive will be at or near the value
estimated by the Black-Scholes model. The grant date values were determined
based in part upon the following assumptions:
<TABLE>
<S> <C>
Expected volatility....................................................... 0.2921
Risk-free rate of return.................................................. 6.77%
Dividend yield............................................................ 2.36%
Time of exercise (expected)............................................... 6 years
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN 1995
AND DECEMBER 31, 1995 OPTION/SAR VALUE
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SARS AT OPTIONS/SAR'S AT
UNDERLYING VALUE 12/31/95 (#) 12/31/95($)
OPTIONS/SAR'S REALIZED --------------------------- ---------------------------
NAME EXERCISED (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
J.E. Perrella.............. 0 $ 0 250,000 90,000 $ 840,800 $ 0
J.F. Travis................ 0 0 180,000 40,000 1,089,600 0
T.F. McBride............... 30,000 235,000 35,000 40,000 6,475 0
A.M. Nixon................. 12,000 124,813 30,000 24,000 30,550 0
R.B. Uber.................. 0 0 24,000 25,000 4,440 0
</TABLE>
LONG-TERM INCENTIVE PLAN AWARDS
As described above in the Report of the Compensation and Nominating
Committee, the Company, as part of its executive officer compensation program,
has awarded shares of Company Common Stock under the Company's Incentive Stock
Plans to executive officers and other key employees. One-half of such awards is
contingent upon the individual's continuing employment with the Company and
one-half is contingent upon the Company's earnings per share performance during
the payout period. No stock awards were granted during 1995 to the executive
officers named above.
12
<PAGE>
RETIREMENT PLANS
The Company and its subsidiaries maintain a number of defined benefit
pension plans for their officers and other employees. The pension plans provide
for fixed benefits in the event of retirement at a specified age and after a
specified number of years of service. All of the executive officers of the
Company named above are participants in the Company's Pension Plan Number One
(the "Pension Plan") and the Elected Officers Supplemental Program. The
following table illustrates approximate annual pensions for retirements in 1996
under the Pension Plan and under the Elected Officers Supplemental Program
computed as a straight life annuity, before the reductions specified in Footnote
(a) below and based on the indicated assumptions:
APPROXIMATE ANNUAL PENSION UPON RETIREMENT AT AGE 65 BEFORE OFFSETS (A)
<TABLE>
<CAPTION>
15 YEARS OF 20 YEARS OF 25 YEARS OF 30 YEARS OF 35 YEARS OF 40 YEARS OF
FINAL AVERAGE COMPENSATION SERVICE SERVICE SERVICE SERVICE SERVICE SERVICE
- ------------------------------ ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
$ 300,000..................... $ 97,500 $ 130,000 $ 162,500 $ 195,000 $ 195,000 $ 195,000
400,000....................... 130,000 173,333 216,667 260,000 260,000 260,000
500,000....................... 162,500 216,667 270,833 325,000 325,000 325,000
600,000....................... 195,000 260,000 325,000 390,000 390,000 390,000
700,000....................... 227,500 303,333 379,167 455,000 455,000 455,000
800,000....................... 260,000 346,667 433,333 520,000 520,000 520,000
900,000....................... 292,500 390,000 487,500 585,000 585,000 585,000
1,000,000..................... 325,000 433,333 541,667 650,000 650,000 650,000
For each additional $50,000... 16,250 21,667 27,083 32,500 32,500 32,500
</TABLE>
- ------------
(a) Benefits payable to participants in the Pension Plan and the Elected
Officers Supplemental Plan are reduced by (i) amounts attributable to the
Company's contributions under the Company's Leveraged Employee Stock Ownership
Plan, the Savings and Stock Investment Plan and Retirement Account Plan and any
related supplemental plan, and (ii) a portion of the Social Security benefits to
which such participants are entitled.
The credited years of service at December 31, 1995 for the individuals named
above are as follows: Mr. Perrella, 34 years; Mr. Travis, 37 years; Mr. McBride,
22 years; Mr. Nixon, 33 years; and Mr. Uber, 29 years. The covered compensation
as of December 31, 1995 for each of such individuals under the Plan is as
follows: Mr. Perrella, $1,110,333; Mr. Travis, $537,235; Mr. McBride, $441,200;
Mr. Nixon, $316,098; and Mr. Uber, $366,770.
OTHER POST-EMPLOYMENT ARRANGEMENTS
The Company has entered into an arrangement with all of the executive
officers named above whereby the Company is obligated to pay certain annual
benefits for a ten-year period commencing upon normal retirement, so long as
their employment with the Company is not terminated by the Company for cause (as
defined) and so long as they meet certain non-competition obligations. In the
event of death, the benefits are payable to the individual's estate to the
extent not already paid. The annual benefits payable to each of such individuals
are as follows: Mr. Perrella, $125,000; Mr. Travis, $65,000; Mr. McBride,
$65,000; Mr. Nixon, $45,000; and Mr. Uber, $45,000. Under this arrangement, the
Company is a beneficiary of life insurance policies on such executives and,
based on actuarial assumptions, the life insurance proceeds receivable by the
Company will defray the costs associated with this program.
13
<PAGE>
The Company has also adopted a program which provides the executive officers
named above with life insurance coverage ranging from one times annual earnings
(as defined) to two times annual earnings (increased in certain instances to
account for income tax obligations payable in respect of such supplemental
coverage).
CHANGE IN CONTROL ARRANGEMENTS
The Company has entered into agreements with each of the executive officers
named above which provide that if the employment of a particular executive
officer is terminated (by the Company or, under certain circumstances, by the
executive officer) within five years following a change in control of the
Company (defined to include the acquisition by any person of 20% or more of the
voting power of the Company's common stock or the disposition of substantially
all the assets of the Company), the executive will receive a lump sum severance
payment from the Company equal to three times the sum of (a) the executive's
highest annual salary from the date of the change in control to the date of
termination plus (b) the highest bonus paid the executive during the period
beginning five years prior to the change in control and ending on the date of
termination. In addition, the executive will receive an amount approximating the
Company's contribution which would have been made for such executive's account
under the Savings Plan and Retirement Account Plan (including the related
supplemental plans) during the three years following termination of employment
and will be entitled during such three-year period to continue to participate in
the Company's welfare employee benefit programs. For purposes of calculating the
executive's retirement benefits, five years will be added to both the
executive's age and service with the Company. The agreements further provide
that if the payments described above constitute "excess parachute payments"
under applicable provisions of the Internal Revenue Code and related
regulations, the Company will pay the executive an additional amount sufficient
to place the executive in the same after-tax financial position the executive
would have been in if the executive had not incurred the excise tax imposed
under Section 4999 of the Internal Revenue Code in respect of excess parachute
payments.
14
<PAGE>
PERFORMANCE GRAPH
The following graph compares for the five years ended December 31, 1995, the
cumulative total shareholder return on the Company's Common Stock with the
cumulative total return on the Standard & Poor's 500 Stock Index and with the
cumulative total return on the Standard & Poor's Machinery-Diversified Index.
The graph assumes that $100 was invested on December 31, 1990 in each of the
Company's Common Stock, the Standard & Poor's 500 Stock Index and the Standard &
Poor's Machinery-Diversified Index and assumes the reinvestment of dividends.
COMPARISON OF FIVE YEAR CUMULATIVE
TOTAL SHAREHOLDER RETURN
Dollars
240 ------------------------------------------------------
220 --- ----[]--- Ingersoll-Rand
----<>--- S & P 500
200 --- ----O---- S & P Machinery
180 ---
160 ---
140 ---
120 ---
100 ---
80 ---
60 ---
------------------------------------------------------
1990 1991 1992 1993 1994 1995
----------------------------------------------------------------------------
Ingersoll-Rand 100 152 165 221 185 211
S & P 100 130 140 155 157 215
S & P Machinery 100 119 121 180 175 216
----------------------------------------------------------------------------
TRANSACTIONS WITH MANAGEMENT
Since January 1, 1995, the Company and its subsidiaries have engaged in
transactions in the ordinary course of business with, or have used products or
services of, a number of organizations in which the Company's directors have
interests. The amounts involved have in no case been material in relation to the
business of the Company and its subsidiaries and the Company believes that they
have not been material in relation to the businesses of such other organizations
or to the individual directors concerned. It is expected that the Company and
its subsidiaries may continue to engage in similar transactions with such
organizations in the future.
2. RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed Price Waterhouse LLP as independent
accountants for the Company and its subsidiaries to examine the consolidated
financial statements of the Company for the fiscal year ending December 31,
1996. The appointment of Price Waterhouse LLP is subject to ratification by the
shareholders and a resolution for such ratification will be offered at the
Annual Meeting. Price Waterhouse LLP has been acting as independent accountants
for the Company and its subsidiaries for many years and, both by virtue of its
long familiarity with the Company's affairs and its ability, is considered best
qualified to perform this important function.
15
<PAGE>
Representatives of Price Waterhouse LLP are expected to be present at the
Annual Meeting and to be available to respond to appropriate questions. They
will have an opportunity to make a statement if they so desire.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL AND YOUR PROXY
WILL BE SO VOTED UNLESS OTHERWISE SPECIFIED.
OTHER MATTERS
The Annual Meeting is called for the purposes set forth in the notice
thereof. The Board of Directors does not intend to present, and has not been
informed that any other person intends to present, any matters for action at the
Annual Meeting other than those specifically referred to in the proxy and this
Proxy Statement. If any other matters are properly brought before the Annual
Meeting, it is the intention of the proxyholders to vote on such matters in
accordance with their judgment.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Any proposal by a shareholder intended to be presented at the 1997 Annual
Meeting of Shareholders of the Company must be received at the Company's
principal executive offices at 200 Chestnut Ridge Road (P.O. Box 8738),
Woodcliff Lake, New Jersey 07675, Attn: Secretary, no later than November 13,
1996, for inclusion in the proxy materials relating to that meeting.
The Company's By-laws, as amended, set forth procedures to be followed by
shareholders who wish to nominate candidates for election to the Board in
connection with annual meetings of shareholders or pursuant to written
shareholder consents. All such nominations must be made following written notice
to the Secretary of the Company accompanied by certain background and other
information specified in the By-laws. In connection with any annual meeting,
written notice of a shareholder's intention to make such nominations must be
given to the Secretary not later than the date which is 90 days in advance of
the anniversary of the immediately preceding annual meeting or, if the date of
the annual meeting occurs more than 30 days before, or 60 days after, the
anniversary of such immediately preceding annual meeting, not later than the
seventh day after the date on which notice of such annual meeting is given.
A shareholder proposal calling for increased diversity of Board membership
was submitted to the Company for inclusion in this Proxy Statement, but was
withdrawn by the proponent based upon the issuance by the Board of Directors of
a statement to the effect that, consistent with past practices, the Board of
Directors is committed to a strong and diverse membership and engaging in a
careful process to identify those individuals who can best contribute to the
Company's continued success. As a part of that process, the Board will continue
to take all reasonable steps to identify and consider for Board membership all
candidates, including women and minorities, who satisfy the business needs of
the Company at the time of election.
ANNUAL REPORT TO SHAREHOLDERS
The Annual Report to Shareholders for the year ended December 31, 1995 is
enclosed with this Proxy Statement. For shareholders who are employees, the
Annual Report has been distributed at the Company's facilities.
Dated: March 13, 1996
16
<PAGE>
DIRECTIONS TO
WOODCLIFF LAKE
From J.F. Kennedy Airport -
take the Van Wyck Expressway
North to the Grand Central Parkway
West to Triboro Bridge.
Cross Triboro Bridge and take the
Major Deegan Expressway North to the
George Washington Bridge. Cross the
George Washington Bridge Bridge and
take Interstate Route 80 West to
Garden State Parkway North to [MAP DIAGRAM] [MAP DIAGRAM]
Exit 171.
Leave the Garden State Parkway
at Exit 171, turn legft at Glen Road,
cross under the Garden State Parkway
and turn left on Chestnut Ridge Road
south approximately 3/4 of a mile
to Ingersoll-Rand.
<TABLE>
<S> <C> <C>
From LaGuardia - Take the From Manhattan - Take the State Parkway connection is
Grand Central Parkway West West Side Highway North to Schoolhose Road. Turn left
and follow the same route the Henry Hudson Parkway to off the ramp on Schoolhouse
as described above from the George Washington Bridge. Road and travel one mile to
J.F. Kennedy Airport. Then follow the same route Summit Avenue. Turn right on
as described above from J.F. and proceed approximately one
Kennedy Airport. mile to Chesnut Ridge Road.
Turn left on Chestnut Ridge
From Newark - Take the From the New York Thruway - Road and continue south
Jersey Turnpike North to Follow signs leading to the approximately two miles to
Route 80 West and follow Garden State Parkway. The Ingersoll-Rand.
from J.F. Kennedy Airport. first exit southbound on the
Garden
INGERSOLL-RAND
--------------
</TABLE>
<PAGE>
INGERSOLL-RAND COMPANY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS APRIL 26, 1996
The undersigned hereby appoints JAMES E. PERRELLA, THOMAS F. MCBRIDE and
PATRICIA NACHTIGAL, or any of them, with power of substitution, attorneys and
proxies to vote, as indicated on the reverse hereof, all shares of stock of
Ingersoll-Rand Company (the "Company") which the undersigned is entitled to vote
at the Annual Meeting of Shareholders to be held at the Company's executive
offices, 200 Chestnut Ridge Road, Woodcliff Lake, New Jersey, on Friday, April
26, 1996, at 10:30 A.M., or at any adjournments thereof, with all the powers the
undersigned would possess, including cumulative voting rights, if then and there
personally present, upon the matters described in the Notice of Annual Meeting
of Shareholders and Proxy Statement, dated March 13, 1996, receipt of which is
hereby acknowledged, and upon any other business that may come before the
meeting or any such adjournment.
The nominees for election as directors are H. William Lichtenberger, James E.
Perrella and John E. Phipps.
PLEASE MARK, SIGN AND DATE ON REVERSE SIDE AND RETURN IN THE ACCOMPANYING
ENVELOPE.
<PAGE>
[LOGO] World Headquarters
-------------------------------------
Ingersoll-Rand Company
Woodcliff Lake, New Jersey 07675-8738
March 13, 1996
Dear Shareholder:
It is my pleasure to invite you to Ingersoll-Rand Company's 1996 Annual Meeting
of Shareholders. The meeting will be held at 10:30 a.m. on Friday, April 26,
1996, at the Company's executive offices in Woodcliff Lake, New Jersey.
The enclosed Notice of Meeting and Proxy Statement covers the formal business
of the meeting, which includes the election of directors and the ratification
of the appointment of the independent accountants for the coming year. Also
during the meeting, management will address other corporate matters which may
be of interest to you as a shareholder.
It is important that your shares are represented at this meeting, whether or
not you attend the meeting in person and regardless of the number of shares you
own. To be sure your shares are represented, we urge you to complete and mail
the attached proxy card as soon as possible. If you attend the meeting and wish
to vote in person, the ballot that you submit will supersede your proxy.
Sincerely,
/s/ James E. Perrella
James E. Perrella
Chairman, President
and Chief Executive Officer
<TABLE><CAPTION>
DETACH PROXY CARD HERE
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
-----
| |
-----
To vote your shares for all director Directors recommend a vote "For" Directors recommend a vote "For"
nominees, mark the "For" box on --------------------------------- ----------------------------------------------
item 1. To withhold voting for all 1. Election of Directors 2. Ratification of appointment of independent
nominees, mark the "Withhold" box. *Exception(s):.................. accountants
If you do not wish your shares voted
"For" a particular nominee, mark the
"Exception" box and enter the name(s) For Withhold Exceptions* For Against Abstain
of the exception(s) in the space
provided. [] [] [] [] [] []
This proxy when properly executed will be voted in the manner directed herein by the
undersigned shareholder. If no contrary specifications are made above, this proxy will
be voted FOR items 1 and 2.
Change of Address and
or Comments Marks Here []
DATED _____________________________ 1996
SIGNED _________________________________
SIGNED _________________________________
Votes must be indicated (X) in black
or blue ink as in this example. [X]
</TABLE>
