<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
LEGGETT & PLATT, INCORPORATED
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
LEGGETT & PLATT, INCORPORATED
--------------------------------------------------------------------------------
(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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
LOGO
March 31, 1995
Dear Shareholder:
The Board of Directors cordially invites you to attend the Annual Meeting of
Shareholders of Leggett & Platt, Incorporated on Wednesday, May 10, 1995, at
10:00 a.m., local time, at the Company's Cornell Conference Center, No. 1--
Leggett Road, Carthage, Missouri.
The enclosed Proxy Statement contains two proposals: the election of
Directors and the ratification of the Board's selection of Price Waterhouse as
the Company's independent accountants for 1995.
I urge you to vote your proxy FOR each of the Board proposals.
We hope you will attend the Annual Meeting, but whether or not you expect to
attend, please sign and return the enclosed proxy card now so your shares will
be represented at the meeting. If you attend the meeting, you will be entitled
to vote in person.
Sincerely yours,
LEGGETT & PLATT, INCORPORATED
/s/ Harry M. Cornell, Jr.
Harry M. Cornell, Jr.
Chairman of the Board
and Chief Executive Officer
<PAGE>
LEGGETT & PLATT, INCORPORATED
NO. 1--LEGGETT ROAD
CARTHAGE, MISSOURI 64836
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON WEDNESDAY, MAY 10, 1995
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Leggett &
Platt, Incorporated (the "Company") will be held at the Company's Cornell
Conference Center, No. 1--Leggett Road, Carthage, Missouri, on Wednesday, May
10, 1995, at 10:00 a.m., local time:
1. To elect ten (10) Directors to hold office until the next Annual
Meeting of Shareholders or until their successors are elected and
qualified;
2. To ratify the selection of Price Waterhouse as the Company's
independent accountants for the year ending December 31, 1995; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on March 15, 1995, has been fixed for determination of
shareholders entitled to notice of and to vote at such Annual Meeting of
Shareholders or any adjournment thereof, and only shareholders of record on
such date are so entitled.
An Annual Report outlining the Company's operations during the fiscal year
ended December 31, 1994, accompanies this Notice of Annual Meeting of
Shareholders and Proxy Statement.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE SIGN AND
RETURN THE ENCLOSED PROXY IN THE ENCLOSED SELF-ADDRESSED, POSTAGE-PAID
ENVELOPE. If you attend the Annual Meeting, you will be entitled to vote in
person.
By Order of the Board of Directors
Ernest C. Jett
Assistant Secretary
Carthage, Missouri
March 31, 1995
<PAGE>
LEGGETT & PLATT, INCORPORATED
NO. 1--LEGGETT ROAD
CARTHAGE, MISSOURI 64836
ANNUAL MEETING--MAY 10, 1995
PROXY STATEMENT
Leggett & Platt, Incorporated (the "Company") will hold its 1995 Annual
Meeting of Shareholders on Wednesday, May 10, 1995, in Carthage, Missouri. At
the meeting shareholders will elect ten (10) Directors and vote on the
ratification of Price Waterhouse as the Company's independent accountants for
1995.
We wish that all of our shareholders could attend the meeting and vote in
person. However, since this is not possible, the Board of Directors is
soliciting your proxy so that you will be represented and can vote at the
meeting.
This Proxy Statement and the enclosed Annual Report contain information about
the meeting, the Company, the Company's independent accountants, and the
Company's Directors and Executive Officers. We hope that this Proxy Statement
is useful to you as you return your proxy and helps you better understand your
Company.
PLEASE SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE-PAID
ENVELOPE AS SOON AS POSSIBLE, whether or not you intend to attend the Annual
Meeting.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
INFORMATION ABOUT THE MEETING AND VOTING................................... 1
PROPOSAL ONE--ELECTION OF DIRECTORS........................................ 2
PROPOSAL TWO--RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS......... 3
INFORMATION TO ASSIST IN EVALUATING BOARD PROPOSALS........................ 4
Leggett & Platt, Incorporated Common Stock Performance Graph............. 4
Compensation Committee Report On Executive Compensation.................. 5
Executive Compensation And Related Matters............................... 8
Ownership Of Common Stock................................................ 12
FINANCIAL DATA............................................................. 13
1996 SHAREHOLDER PROPOSALS................................................. 13
OTHER MATTERS.............................................................. 13
</TABLE>
(i)
<PAGE>
INFORMATION ABOUT THE MEETING AND VOTING
This Proxy Statement is furnished to shareholders of Leggett & Platt,
Incorporated (the "Company") in connection with the solicitation of proxies by
the Board of Directors of the Company (the "Board") to be voted at the Annual
Meeting of Shareholders of the Company on May 10, 1995, and any adjournment
thereof. The Board solicits your proxy on the form enclosed.
The approximate date on which this Proxy Statement and the enclosed form of
proxy are first being sent to shareholders is March 31, 1995.
RIGHT TO REVOKE PROXY
Any shareholder giving the enclosed proxy can revoke such proxy prior to the
exercise thereof by providing written notice of such revocation to the Company
at or prior to the Annual Meeting, by executing a proxy bearing a later date or
by attending the Annual Meeting and voting in person. Unless the persons named
in the proxy are prevented by circumstances beyond their control from acting,
the proxy will be voted at the meeting and at any adjournment thereof in the
manner specified therein.
BY WHOM AND THE MANNER IN WHICH THE PROXY IS BEING SOLICITED
The enclosed proxy is solicited by and on behalf of the Board. The expense of
the solicitation of proxies for this meeting, including the cost of mailing,
will be borne by the Company. The Company will request persons holding stock in
their name or custody on behalf of others, or as nominees, to send proxy
materials to their principals requesting authority for the execution of the
proxies. The Company will reimburse such persons for their expense in so doing.
If necessary to assure sufficient representation at the meeting, employees of
the Company, at no additional compensation, will request the return of proxies
personally or by telephone or telegram. The extent to which this will be
necessary depends entirely on how promptly proxies are received. Shareholders
are urged to send in their proxies without delay. The Board has no knowledge or
information that any other person will specifically engage any employees to
solicit proxies.
VOTING SECURITIES OUTSTANDING
The only class of outstanding voting securities of the Company is the
Company's $.01 par value Common Stock ("Common Stock"). At February 15, 1995,
there were outstanding and entitled to vote 41,604,014 shares of Common Stock.
Only shareholders of record at the close of business on March 15, 1995, are
entitled to vote at the Annual Meeting or any adjournment thereof.
A majority of the outstanding shares of Common Stock present or represented
will constitute a quorum for the transaction of business at the Annual Meeting.
If a quorum is not present, the Annual Meeting may be adjourned to a specified
date not more than ninety (90) days after adjournment in order that a quorum
may be present or represented.
Every shareholder shall have the right to vote, in person or by proxy, one
vote per share on all matters. Abstentions and broker non-votes are each
included for purposes of determining whether a quorum is present. Abstentions
are counted in tabulations of the votes cast on proposals presented to
shareholders. Broker non-votes, which occur when brokers do not exercise
discretionary voting authority for beneficial owners who have not provided
voting instructions, are not counted in tabulations of the votes cast on
proposals presented to shareholders.
1
<PAGE>
PROPOSAL ONE
ELECTION OF DIRECTORS
At the Annual Meeting, ten (10) Directors are to be elected who shall hold
office until the next following Annual Meeting of Shareholders or until their
successors are duly elected and qualified. The persons named in the enclosed
proxy intend to vote such proxy for the election of the ten (10) nominees named
below. Each of these nominees, except Mr. Bentele, was elected by the
shareholders at the last Annual Meeting. If any of the nominees named below is
not a candidate for election as a Director at the meeting--an event which the
Board does not anticipate--the proxy will be voted for a substitute nominee, if
any, designated by the Board and the other nominees named below.
RAYMOND F. BENTELE, age 58, served as President and Chief Executive Officer
of Mallinckrodt, Inc. from 1981 until his retirement on November 30, 1992. He
also served as Executive Vice President and Vice Chairman of Mallinckrodt Group
Inc. from 1989 until retirement. Mr. Bentele serves as a director of
Mallinckrodt Group Inc., a manufacturer of medical, specialty chemical and
veterinary products; Kellwood Company, an apparel and camping goods
manufacturer; and IMC Global, Inc., a producer of crop nutrient minerals.
HARRY M. CORNELL, JR., age 66, has served the Company as Chief Executive
Officer and Chairman of the Board for more than the past five years. Mr.
Cornell was first elected as a Director of the Company in 1958. Mr. Cornell is
a director of Ennis Business Forms, Inc., a business forms manufacturer, and
Mercantile Bancorporation Inc.
R. TED ENLOE, III, age 56, has been President and Chief Executive Officer of
Liberte Investors for more than the past five years. He also served as
President of Lomas Financial Corporation from 1975 until September 1991. In
addition, Mr. Enloe serves as a director of LNH REIT, Inc., a real estate
lending and investments concern; Compaq Computer Corporation; SIXX Holdings,
Inc., an operator of Italian restaurants; and Epikon, Inc., a developer of
medical imaging systems. Mr. Enloe was first elected as a Director of the
Company in 1969.
RICHARD T. FISHER, age 56, is presently Managing Director of Oppenheimer &
Company. Previously, Mr. Fisher served as Senior Vice President of Shearson
Lehman Hutton from July 1989 to May 1990. From 1988 to June 1989, Mr. Fisher
was Senior Vice President of Drexel Burnham Lambert Incorporated. Mr. Fisher
was first elected as a Director of the Company in 1972.
FRANK E. FORD, JR., age 71, was first elected as a Director of the Company in
1963. Prior to his retirement in 1981, Mr. Ford served as a Senior Vice
President of the Company.
ROBERT A. JEFFERIES, JR., age 53, was elected Senior Vice President, Mergers,
Acquisitions and Strategic Planning in June 1990. Mr. Jefferies also served the
Company first as Vice President and later as Senior Vice President, General
Counsel, and Secretary from May 1977 until January 1993. Mr. Jefferies was
first elected as a Director of the Company in 1991.
ALEXANDER M. LEVINE, age 63, serves as a Special Advisor employed by the
Company. From 1989 through 1994, Mr. Levine served as Director of International
Development of the Company. Mr. Levine was first elected as a Director of the
Company in 1989. In addition, Mr. Levine serves as a director of Cross Comm
Corporation, a computer networking products and services provider.
RICHARD L. PEARSALL, age 66, is an independent management and business
consultant, and serves on the advisory board for Wilkes-Barre, Pennsylvania
area operations of Mellon Bank, N.A. Mr. Pearsall was first elected as a
Director of the Company in 1983.
2
<PAGE>
MAURICE E. PURNELL, JR., age 55, was first elected as a Director of the
Company in 1988. For more than the past five years, Mr. Purnell has been a
shareholder in the law firm of Locke Purnell Rain Harrell (A Professional
Corporation).
FELIX E. WRIGHT, age 59, has served the Company as President and Chief
Operating Officer for more than the past five years. Mr. Wright was first
elected as a Director of the Company in 1977.
BOARD MEETINGS AND COMMITTEES
The Board held four (4) meetings in 1994. All Directors attended at least 88%
of the aggregate of the meetings of the Board and the committees on which they
served in 1994.
The Board has an Executive Committee, an Audit Committee, and a Compensation
Committee. The Board does not have a nominating committee. Directors do not
receive additional fees for committee participation.
In 1994, the Audit Committee consisted of four directors: Herbert C. Casteel
(Chairman), Richard T. Fisher, James C. McCormick, and Maurice E. Purnell, Jr.
Mr. McCormick, who served as a director of the Company since 1966, died in
February 1995. The Audit Committee is responsible for recommending to the Board
the selection of independent auditors, reviewing auditors' compensation,
reviewing the coordination between the independent auditors and the Company's
internal audit staff, reviewing the scope and procedures of the internal audit
work, and reviewing the results of the independent audit and accounting
policies with the independent auditors and management personnel. The Audit
Committee held four (4) meetings in 1994.
COMPENSATION COMMITTEE; INTERLOCKS AND INSIDER PARTICIPATION
In 1994, the Compensation Committee consisted of four directors: R. Ted
Enloe, III (Chairman), Richard T. Fisher, Frank E. Ford, Jr., and Richard L.
Pearsall. The Compensation Committee is responsible for executive compensation
policies and approving compensation payable to the Executive Officers of the
Company. The Compensation Committee held one (1) meeting in 1994.
Prior to his retirement in 1981, Mr. Ford, a member of the Compensation
Committee, served as a Senior Vice President of the Company.
OTHER
The vote of a plurality of the shares present and voting at the Annual
Meeting will be required for the election of Directors.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF EACH OF THE NOMINEES.
PROPOSAL TWO
RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
Upon recommendation of the Audit Committee, the Board has selected Price
Waterhouse as the Company's independent accountants for the fiscal year ending
December 31, 1995. Price Waterhouse has been engaged as the Company's
independent accountants for each year beginning with the year ended December
31, 1991.
It is expected that representatives of Price Waterhouse will be present at
the Annual Meeting and will have an opportunity to make a statement if they
desire to do so and will also be available to respond to questions raised at
the meeting or submitted to them in writing before the meeting.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE APPROVAL OF THE SELECTION OF PRICE
WATERHOUSE.
3
<PAGE>
INFORMATION TO ASSIST IN EVALUATING BOARD PROPOSALS
To assist our shareholders in evaluating the proposals presented by the Board
to be voted on at the 1995 Annual Meeting, the following information about the
Company and its Directors and Executive Officers is provided.
LEGGETT & PLATT, INCORPORATED
COMMON STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total return to shareholders on
the Company's Common Stock over the five years ended December 31, 1994, to the
returns on the New York Stock Exchange's Composite Index and a group of peer
companies (the "Peer Group") in a Household Furniture Index prepared and
published by Media General Financial Services of Richmond, Virginia. Additional
information concerning the long-term performance of the Company can be found in
the Annual Report to Shareholders which accompanies this Proxy Statement.
<TABLE>
[GRAPH APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG LEGGETT & PLATT, INCORPORATED, NYSE COMPOSITE INDEX AND PEER GROUP
<CAPTION>
Measurement Period LEGGETT & PLATT, NYSE
(Fiscal Year Covered) INCORPORATED PEER GROUP COMPOSITE INDEX
------------------- --------------- ---------- ---------------
<S> <C> <C> <C>
Measurement Pt-
12/31/89 $100.00 $100.00 $100.00
FYE 12/31/90 $ 90.52 $ 75.47 $ 95.92
FYE 12/31/91 $133.42 $105.85 $124.12
FYE 12/31/92 $214.08 $145.84 $129.96
FYE 12/31/93 $363.83 $192.83 $147.56
FYE 12/31/94 $258.84 $139.96 $144.69
</TABLE>
The comparison assumes separate $100 investments were made on January 1,
1990, in Company Common Stock, the NYSE Composite Index, and the Peer Group and
that all dividends during the period have been reinvested. Returns are at
December 31 of each year. The impact of income taxes is not reflected. The Peer
Group consists of twenty companies in the household furniture industry
selected, prepared and published by Media General Financial Services. This
index is available by contacting the Company's Investor Relations Department,
Attention: J. Richard Calhoon, Vice President--Investor Relations (800-888-
4569). Index information will be provided by mail, telephone or telecopier.
4
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Company's Board
establishes executive compensation policies and approves compensation
(including stock awards and stock options) relating to the Executive Officers
of the Company. The Committee presently consists of four independent non-
employee Directors: Messrs. Enloe, Fisher, Ford, and Pearsall. Mr. Enloe is
Chairman.
Set out below is a report of the Committee concerning its compensation
policies applicable to the Company's Executive Officers.
BASIC PRINCIPLES
Compensation of Company executives is designed to attract, retain, and
motivate high quality managers and policy makers while at the same time
aligning the interests of the Company's executives with the interests of the
shareholders. Executive compensation is based both on the individual
contribution of the executive and Company performance generally. Ownership of
Common Stock by Executive Officers and other managers is strongly encouraged
because it focuses the Company's executives on the importance of maximizing
shareholder value. These basic principles are implemented as described below.
Salary. The Committee annually reviews the Executive Officers' salaries and,
if warranted, approves management recommended changes. Management
recommendations are made by the Chief Executive Officer and the President and
are developed in consultation with the Company's Personnel Department. Merit
increase guidelines are prepared annually by Company management, approved by
the Compensation Committee and apply to Company managers generally. In 1994,
management recommended that Mr. Cornell receive an increase consistent with the
Company's 1994 merit increase guidelines for excellent performance. The
Committee's review of management recommendations, although largely subjective
and informal, takes into consideration the Company's performance over the
preceding year and each executive's individual performance and contribution
related to the executive's particular business unit or function, and its
contribution to overall Company performance. The Committee believes the
Company's executives' salaries have generally been set at conservative levels
given the experience, length of service, skills and performance of the
executives.
Employment contracts with certain Executive Officers, including Mr. Cornell,
are described in this Proxy Statement under Change-in-Control Arrangements and
Employment Contracts. Under these agreements annual percentage increases in
salary must be at least equal to the percentage increases over the previous
year (to the extent not attributable to additional responsibilities) of the
five highest paid executives other than the Executive Officer in question and
the Chief Executive Officer. This contractual provision did not affect the
salary increase approved for Mr. Cornell in 1994.
Management recommended that Mr. Cornell receive a 6.3% salary increase in
April, 1994. Approval of the increase was based primarily on the Company's
performance in 1993. For the year ended December 31, 1993, the Company's sales
increased 16% from $1.32 billion to $1.53 billion. For the same period, the
Company also experienced record net earnings of $2.09 per share, representing
an increase of 27% over 1992. The Company's return on average equity for 1993
was 17.9%.
While this performance was attributable to the efforts of all of the
Company's employee/partners, Mr. Cornell's vision and leadership were
instrumental in the Company's success in 1993. Approval of Mr. Cornell's 6.3%
salary increase in April, 1994 was based upon and conservative in light of the
Company's good performance in 1993.
Bonuses. Bonuses may be awarded under the Company's long-standing Key
Management Incentive Compensation Plan (the "Bonus Plan"). All Bonus Plan
bonuses (except for a 10% discretionary portion) are directly tied to a pre-
established formula. The formula is based on (i) after-tax returns on the
Company's adjusted average equity ("ROAAE") and (ii) EBIT (earnings before
interest and taxes) returns on adjusted net assets ("ROANA"). ROAAE and ROANA
are given equal weight in the formula.
5
<PAGE>
Total bonuses to all Bonus Plan participants may not exceed 4% of EBIT. The
size of each participant's bonus is determined by applying the bonus formula to
a percentage of the participant's salary (the "target percentage"). Target
percentages for the Executive Officers appearing in the Summary Compensation
Table were established several years ago. If threshold ROAAE and ROANA levels
are met a portion of the applicable target percentage becomes payable. This
portion increases as the returns increase above the thresholds. The bonus may
be greater than 100% of the target percentage, subject to the overall limit on
Bonus Plan bonuses.
Mr. Cornell's target percentage is 60% of his salary. This target percentage
has not changed in 16 years. His bonus is determined by the application of the
bonus formula in the same manner as other bonuses are determined.
In 1994, thresholds were exceeded and total Bonus Plan bonuses represented
3.57% of EBIT. In 1993 and 1992, Bonus Plan bonuses represented 2.97% and 2.28%
of EBIT, respectively. Thresholds and performance criteria in 1994 were the
same as in 1992 and 1993, and are anticipated to be the same in 1995.
Stock Options. Options to purchase the Company's Common Stock tie the
interests of the Company executives directly to the performance of the
Company's Common Stock. Stock options represent a significant portion of the
overall compensation package of each Executive Officer and a large group of
other Company managers. Only through enhancing shareholder wealth will the
Company's Executive Officers and other managers receive the full potential of
this important part of their compensation package. Approximately 615 employees,
including Executive Officers, presently hold stock options.
Mr. Cornell and certain other Executive Officers received special awards in
the form of stock options based on the Company's performance in 1994. For the
year ended December 31, 1994, the Company's sales increased 22% from $1.53
billion to $1.86 billion. For the same period, the Company also experienced
record net earnings of $2.78 per share, representing an increase of 33% over
1993. The Company's return on average equity was 20.2%.
Other Stock-Based Compensation. In addition to stock options, the Company
employs other compensation plans which encourage executive ownership of Company
Common Stock. Under various stock purchase plans, Executive Officers and over
3,500 other employees make contributions of their own funds toward the purchase
of Common Stock.
All of the Company's Executive Officers, except Mr. Cornell, participate in
the Company's Executive Stock Purchase Program ("ESPP"). The purpose of the
ESPP is to assist Company management employees in saving for their retirement
while building a long-term stake in the Company.
Under the ESPP, the Company grants cash awards in the amount of 50% of an
executive's "Eligible Contributions" to the Company's 1989 Discount Stock Plan
(the "Discount Plan"), plus an additional amount which is withheld to pay a
portion of the executive's federal and state taxes attributable to the cash
awards ("tax offset bonus"). The Discount Plan is a plan qualified under
Section 423 of the Internal Revenue Code ("IRC") under which employees may
purchase Company Common Stock at a discount. "Eligible Contributions" are
contributions made by the executive to the Discount Plan up to 5.7% of his
compensation above his compensation base (in most cases $20,670). In addition,
the ESPP provides for an additional cash award in the amount of 50% of Eligible
Contributions plus a tax offset bonus in the event performance criteria are met
for the year in question. The performance criteria in 1994 was 12.5% return on
average equity, which was the same as the goal in 1992 and 1993. The
performance goal was met in 1994.
Due to provisions in the IRC, Mr. Cornell is precluded from participating in
the ESPP. Certain other Executive Officers may participate only partially in
the ESPP. For this reason, Mr. Cornell and certain other Executive Officers
have been granted stock awards under the Company's 1989 Flexible Stock Plan.
These stock awards provide Mr. Cornell and the other Executive Officers
benefits which are designed to be similar in effect to participation in the
ESPP.
6
<PAGE>
OTHER MATTERS
Due to limitations imposed by the IRC, Mr. Cornell and other Executive
Officers have been unable for several years to fully participate in the
Company's tax qualified defined benefit retirement plan ("Retirement Plan").
For this reason the Committee approved payments to Mr. Cornell and other
Executive Officers in 1994 to compensate them for the reductions (through 1994)
of their retirement benefits resulting from their inability to fully
participate in the Retirement Plan.
Section 162(m) of the IRC, enacted in 1993, generally disallows a tax
deduction to public companies for compensation over $1 million paid to any of
the Company's Chief Executive Officer and four other most highly compensated
Executive Officers. Certain performance based compensation, however, is
specifically exempt from the deduction limit. No Executive Officer of the
Company received compensation in 1994 which exceeded the $1 million threshold.
However, this threshold may be exceeded in the future. Accordingly, the
Compensation Committee continues to study the impact of Section 162(m). No
formal policy has at this time been adopted.
R. Ted Enloe, III (Chairman)
Richard T. Fisher
Frank E. Ford, Jr.
Richard L. Pearsall
7
<PAGE>
EXECUTIVE COMPENSATION AND RELATED MATTERS
The following table sets forth a summary of certain compensation provided to
the Company's five most highly compensated Executive Officers for each of the
three years in the period ending December 31, 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
---------------------------------- ------------
NAME AND PRINCIPAL OTHER ANNUAL AWARDS ALL OTHER
POSITION YEAR SALARY BONUS COMPENSATION (1) OPTIONS (#) COMPENSATION ($)(6)
------------------ ---- -------- -------- ---------------- ------------ -------------------
<S> <C> <C> <C> <C> <C> <C>
Harry M. Cornell, Jr... 1994 $501,923 $461,776 -0- 24,983 $143,174
Chairman of the Board 1993 $472,731 $340,864 $421,485 -0- $117,892
and Chief Executive 1992 $441,309 $226,260 $406,000 46,000 $105,353
Officer
David S. Haffner....... 1994 $229,615 $142,692 -0- 19,784(2) $ 45,377
Senior Vice President 1993 $186,269 $102,426 -0- -0- $ 25,978
and 1992 $163,525 $ 56,984 $ 70,000 17,400 $ 17,869
President--Furniture
and
Automotive Components
Group
Robert A. Jefferies,
Jr.................... 1994 $260,615 $159,693 -0- 13,229(3) $ 49,858
Senior Vice President, 1993 $241,154 $115,766 -0- -0- $ 34,859
Mergers, Acquisitions 1992 $216,894 $105,420 $231,000 23,000 $ 27,616
and
Strategic Planning and
Director
Duane W. Potter........ 1994 $253,655 $156,403 -0- 12,159(4) $ 62,402
Senior Vice President 1993 $238,154 $115,766 -0- -0- $ 38,754
and 1992 $213,894 $ 75,420 $223,000 23,000 $ 30,812
President--Bedding
Components Group
Felix E. Wright........ 1994 $393,577 $303,600 -0- 47,021(5) $106,028
President and Chief 1993 $360,596 $217,358 -0- -0- $ 75,909
Operating Officer and 1992 $331,731 $141,412 $442,000 34,500 $ 57,619
Director
</TABLE>
---------------------
(1) Other Annual Compensation consists solely of discretionary cash payments
awarded by the Compensation Committee. These payments were primarily
intended to reimburse the Executive Officers for a portion of substantial
income tax liabilities incurred as a result of their purchase of Common
Stock under nonqualified stock options. In exercising its discretion and
awarding the cash payments, the Compensation Committee took into
consideration the performance of the Company from the time the stock
options in question were granted.
(2) Includes stock options for 7,173 shares and 5,143 shares awarded Mr.
Haffner in lieu of $215,000 of 1994 salary and $142,692 of 1994 bonus. (The
salary and bonus foregone is also shown in the "Salary" and "Bonus"
columns.)
(3) Includes stock options for 5,756 shares awarded Mr. Jefferies in lieu of
$159,693 of 1994 bonus. (The bonus foregone is also shown in the "Bonus"
column.)
(4) Includes stock options for 4,686 shares awarded Mr. Potter in lieu of
$130,000 of 1994 bonus. (The bonus foregone is also shown in the "Bonus"
column.)
(5) Includes stock options for 10,944 shares awarded Mr. Wright in lieu of
$303,600 of 1994 bonus. (The bonus foregone is also shown in the "Bonus"
column.)
8
<PAGE>
(6) The majority of All Other Compensation represents awards under the
Company's Executive Stock Purchase Program ("ESPP") and Flexible Stock Plan
which replace retirement benefits not available to the Executive Officers
under the Company's tax qualified defined contribution plan. The amounts
disclosed for 1994 include: split-dollar life insurance premiums (Cornell--
$1,651, Wright--$493); disability insurance premiums (Haffner--$1,736,
Jefferies--$3,941, Potter--$7,836, Wright--$9,572); ESPP and stock awards
(Cornell--$118,498, Haffner--$43,641, Jefferies--$44,298, Potter--$49,280,
Wright--$87,999); and payments made to compensate for reductions in
retirement benefits resulting from inability to fully participate in the
Company's tax qualified defined benefit retirement plan (Cornell--$23,025,
Jefferies--$1,619, Potter--$5,286, Wright--$7,964).
STOCK OPTION INFORMATION
The following table provides information concerning stock options granted
during the year ended December 31, 1994, to Executive Officers named above.
OPTION GRANTS IN 1994
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
% OF TOTAL ASSUMED ANNUAL RATES OF
OPTIONS EXERCISE MARKET STOCK PRICE APPRECIATION
OPTIONS GRANTED TO PRICE PRICE FOR OPTION TERM (1)
GRANTED EMPLOYEES IN ($ PER ON DATE EXPIRATION --------------------------------------
NAME (#) FISCAL YEAR SHARE) OF GRANT DATE 0% 5% 10%
---- --------- ------------ -------- -------- ---------- -------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Haffner 7,173(2) 9.6% $1.00 $37.50 06/30/09 $261,815 $552,033 $1,116,455
5,143(3) $1.00 $33.625 12/11/09 $167,790 $354,373 $ 717,243
3,605(4) $1.00 $33.625 12/11/09 $117,613 $248,399 $ 502,753
Jefferies 360(5) 6.5% $1.00 $33.625 12/11/09 $ 11,745 $ 24,805 $ 50,206
5,756(3) $1.00 $33.625 12/11/09 $187,790 $396,611 $ 803,333
4,686(4) $1.00 $33.625 12/11/09 $152,881 $322,884 $ 653,509
Potter 3,862(5) 5.7% $1.00 $37.50 06/30/09 $140,963 $297,219 $ 601,108
4,686(3) $1.00 $33.625 12/11/09 $152,881 $322,884 $ 653,509
937(4) $1.00 $33.625 12/11/09 $ 30,570 $ 64,563 $ 130,674
Wright 10,944(3) 6.6% $1.00 $33.625 12/11/09 $357,048 $754,042 $1,526,250
GAIN FOR ALL SHAREHOLDERS AT ASSUMED RATES
OF STOCK PRICE APPRECIATION................................. $ -0- $1,550,000,000 $4,565,000,000
</TABLE>
---------------------
(1) These dollar amounts represent a hypothetical increase in the price of the
common stock from the date of option grant until their expiration date at
the rate of 0%, 5% and 10% per annum compounded.
(2) Stock option grant in lieu of 1994 salary.
(3) Stock option grant in lieu of 1994 bonus.
(4) Stock option grant in lieu of 1995 salary.
(5) Stock option grant in lieu of 1993 bonus.
The options reported above are exercisable six months after the date of grant
or when they become vested, whichever is later.
9
<PAGE>
The table below provides information concerning stock options exercised
during the year ended December 31, 1994, by the named Executive Officers and
stock options held by them as of December 31, 1994.
AGGREGATED OPTION EXERCISES IN 1994 AND 12/31/94 OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED IN-
NUMBER OF UNEXERCISED THE-MONEY OPTIONS AT
SHARES OPTIONS AT 12/31/94 12/31/94
ACQUIRED VALUE ------------------------- -------------------------
NAME IN EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Cornell................. -0- -0- 69,577 15,334 $ 994,210 $187,842
Haffner................. 4,960 $110,632 49,031 14,548 $1,032,204 $368,482
Jefferies............... 1,770 $ 40,046 41,449 18,470 $ 700,350 $461,201
Potter.................. 3,039 $ 67,998 43,542 13,291 $ 789,645 $285,115
Wright.................. 7,000 $149,188 86,477 22,444 $1,540,692 $512,971
</TABLE>
RETIREMENT PLAN
The Company has a voluntary, tax qualified, defined benefit retirement plan
(the "Retirement Plan"). The Retirement Plan requires a contribution from
participating employees of 2% of base salary. Employees are not allowed to
discontinue contributions to the Retirement Plan while still in the employ of
the Company. Normal retirement benefits are equal to 1% of the employee's
career average earnings times the number of years the employee was a
participant in the Retirement Plan. Earnings for purposes of the Retirement
Plan include only salary. Benefits for participants in the Retirement Plan at
December 31, 1985, attributable to service prior to January 1, 1986, have been
increased by 50%.
The estimated annual benefits payable upon retirement at the normal
retirement age are listed below for the named Executive Officers.
<TABLE>
<CAPTION>
PROJECTED ANNUAL
EXECUTIVE OFFICER RETIREMENT BENEFIT
----------------- ------------------
<S> <C>
Harry M. Cornell, Jr...................................... $59,388
David S. Haffner.......................................... $54,141
Robert A. Jefferies, Jr................................... $43,373
Duane W. Potter........................................... $29,800
Felix E. Wright........................................... $52,491
</TABLE>
As described below Mr. Cornell is entitled to supplemental pension payments.
If Mr. Cornell retired at December 31, 1995, his estimated annual supplemental
pension payment would be $457,509. The annual pension payment is based upon 60%
of the average of Mr. Cornell's highest consecutive five-year earnings.
CHANGE-IN-CONTROL ARRANGEMENTS AND EMPLOYMENT CONTRACTS
Messrs. Cornell, Jefferies and Wright are parties to severance benefit
agreements and employment agreements with the Company. The severance benefit
agreements have no fixed expiration dates. Subject to certain provisions which
allow earlier termination in the event of total disability and for cause, the
employment agreements expire on December 31, 1998, December 31, 2006, and
December 31, 2000, respectively. Under all employment agreements, compensation
levels are at the discretion of the Company's Compensation Committee subject to
the provision that annual percentage increases in salary must be at least equal
to percentage increases over the previous year (to the extent increases were
not attributable to additional responsibilities) of the salaries of the
Company's five highest paid executives other than the executive and the
Company's Chief Executive Officer.
Mr. Cornell is entitled to a supplemental pension upon termination of
employment in addition to the pension he is entitled to under the Retirement
Plan. The supplemental pension will be for life or 15 years, whichever is
longer. Annual pension payments are based on the average of Mr. Cornell's
highest consecutive five-year earnings ("Average Earnings"). These payments
will be approximately 60% of Average Earnings (less amounts received from
social security). While Mr. Cornell receives supplemental pension payments, the
10
<PAGE>
Company will provide him and his dependents with life, hospitalization, and
major medical insurance equivalent to the coverage provided immediately prior
to the termination of his employment.
If either Mr. Jefferies or Mr. Wright is terminated without cause, each is
entitled to continue to receive his total compensation at the time of his
termination until the earlier of five years after termination or December 31,
2006, in the case of Mr. Jefferies, and December 31, 2000, in the case of Mr.
Wright.
Mr. Cornell, Mr. Jefferies, and Mr. Wright may, under certain circumstances,
elect to terminate their employment and enter into two-year consulting
agreements within 120 days after termination of employment. These circumstances
include change-in-control related events. Under these consulting agreements,
the executive will be paid for consulting services in amounts equal to 100% for
the first year and 75% for the second year of his total cash compensation in
the year immediately preceding his termination.
The severance benefit agreements entitle the covered executives to severance
benefits if, during any 36-month period following a change-in-control of the
Company, (i) the executive's employment is terminated by the Company (except
for cause or disability), or (ii) the executive terminates his employment for
"good reason." The severance benefits include the payment in 36 monthly
installments of an amount equal to three times the executive's annual salary
plus bonus. The severance benefits also include participation in certain fringe
benefits, the immediate vesting of stock options, and the purchase by the
Company of all Common Stock offered by the executive to the Company. All
amounts received by the executive as cash compensation from a new full time job
will reduce the cash severance payments dollar for dollar. Similarly, any
fringe benefits the executive receives from his new job will reduce any fringe
benefits the Company is then providing. However, the executive is not required
to mitigate the severance benefits he obtains.
The agreements further provide that within one year following a change-in-
control opposed by a majority of the Directors, the executive may elect to
terminate his employment for any reason and receive, in lieu of the benefits
described above, a lump sum payment equal to 75% of the executive's cash
compensation preceding the year of termination and certain fringe benefits for
one year.
In the event Mr. Cornell, Mr. Jefferies, or Mr. Wright elects to take the
severance benefits provided, he will forfeit his right to enter into the two-
year consulting agreement with the Company described above.
DIRECTOR COMPENSATION
Under present arrangements, non-employee members of the Board receive a
retainer of $18,000 per year and a fee of $2,500 for attending each regular or
special meeting of the Board. The Company has a program pursuant to which non-
employee directors may elect to receive all or a portion of their annual
retainer in stock options upon election at least six months prior to the option
grant. Each employee-director receives an annual retainer of $3,000. Mr. Levine
received an aggregate of $35,675 in 1994 pursuant to bonus and consulting
arrangements entered into in conjunction with the Company's acquisition of
Webster Spring Co. Inc. in 1989.
RELATED TRANSACTIONS
From 1989 until April 1994, a subsidiary of the Company leased properties
from different trusts in which Director Alexander M. Levine has an interest. A
facility located in Oxford, Massachusetts was leased from JAR Realty Trust, in
which Mr. Levine has a 33 1/3% interest, at an annual rental of $210,000.
Another facility located in Oxford, Massachusetts was leased from GS Realty
Trust, in which Mr. Levine has a 25% interest, at an annual rental of $63,600.
On April 29, 1994, the Company purchased the two facilities in Oxford,
Massachusetts for an aggregate of $3,144,171. From January 1, 1994, through
April 29, 1994, total rental payments of $70,000 and $21,200, respectively,
were made on these two properties.
In 1994, Mr. Cornell leased to the Company, on a month-to-month tenancy
basis, certain real estate located in Keystone, Colorado for $1,925 per month.
Locke Purnell Rain Harrell (A Professional Corporation) performed legal
services for the Company in 1994, and it is anticipated that Locke Purnell Rain
Harrell will perform legal services for the Company in 1995. Mr. Purnell is a
shareholder in Locke Purnell Rain Harrell.
11
<PAGE>
OWNERSHIP OF COMMON STOCK
The table below sets forth the beneficial ownership of Common Stock on
February 15, 1995, by the Company's Directors, nominees for Director, the five
most highly compensated Executive Officers, and all Directors, nominees for
Director and Executive Officers as a group.
<TABLE>
<CAPTION>
COMMON STOCK
-----------------------
BENEFICIALLY % OF
DIRECTORS AND EXECUTIVE OFFICERS OWNED(1) CLASS(2)
-------------------------------- ------------ --------
<S> <C> <C>
Raymond F. Bentele, Nominee for Director........... 1,000 --
Herbert C. Casteel, Director....................... 35,040 .1
Harry M. Cornell, Jr., Chairman of the Board and
Chief Executive Officer........................... 1,328,453 3.2
R. Ted Enloe, III, Director........................ 1,000 --
Richard T. Fisher, Director........................ 25,700 .1
Frank E. Ford, Jr., Director....................... 213,572 .5
David S. Haffner, Senior Vice President and
President--Furniture and
Automotive Components Group....................... 141,813 .3
Robert A. Jefferies, Jr., Senior Vice President,
Mergers, Acquisitions and
Strategic Planning and Director................... 148,632(3) .4
Alexander M. Levine, Director of International
Development and Director.......................... 412,250(4) 1.0
Richard L. Pearsall, Director...................... 259,200 .6
Duane W. Potter, Senior Vice President and
President--Bedding Components Group............... 153,370 .4
Maurice E. Purnell, Jr., Director.................. 2,500 --
Felix E. Wright, President and Chief Operating
Officer and Director.............................. 559,618 1.3
All Executive Officers and Directors as a Group (15
Persons).......................................... 3,565,595 8.6
In addition, Jack B. Morris, Advisory Director of
the Company, beneficially owns 1,005,739 shares of
Common Stock which represents 2.4% of the total
outstanding Common Stock.
</TABLE>
---------------------
(1) The shares shown above as beneficially owned include those shares the
following persons have the right to acquire within sixty days from February
15, 1995, by way of option exercise: Mr. Cornell--69,577; Mr. Ford--882;
Mr. Haffner--49,031; Mr. Jefferies--41,449; Mr. Levine--4,000; Mr. Potter--
43,542; Mr. Wright--86,477; and all Executive Officers and Directors as a
group--354,128.
(2) Beneficial ownership of less than .1% of the class is not shown.
(3) Mr. Jefferies disclaims beneficial ownership of 900 shares held by his
adult sons.
(4) Mr. Levine is a co-trustee for a trust which holds 121,824 shares and
shares voting and investment power of these shares.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The Company knows of no beneficial owner of more than 5% of its Common Stock.
However, the Company's Stock Purchase/Stock Bonus Plan, Retirement Plan and
Executive Stock Purchase Program hold in the aggregate 2,400,918 shares, or
approximately 5.8%, of the outstanding Common Stock.
12
<PAGE>
FINANCIAL DATA
The Company's Annual Report containing financial statements of the Company
for the year ended December 31, 1994, has been enclosed in the same mailing
with this Proxy Statement.
1996 SHAREHOLDER PROPOSALS
If a shareholder intends to present a proposal at the 1996 Annual Meeting of
Shareholders, such proposal must be received at the Company's Corporate Office
no later than December 2, 1995, to be eligible for inclusion in the Company's
Proxy Statement and proxy related to that meeting. If not received by such
date, director nominations and other shareholder proposals may be brought
before the 1996 Annual Meeting (although excluded from the Company's Proxy
Statement and form of proxy relating to that meeting) only if submitted in
writing in accordance with Article I, Section 1.2 or, in the case of
nominations for Director, Article 2, Section 2.1, of the Company's Bylaws.
OTHER MATTERS
The Board does not know of any other matters which may come before the Annual
Meeting. However, if any other matters are properly brought before the meeting
by the Board or any shareholder, the persons named in the accompanying proxy
intend to vote said proxy in accordance with their judgment on such matters.
The enclosed proxy confers discretionary authority to take action with respect
to any additional matters which may come before the meeting.
Even if you expect to be personally present at the meeting, the Board hopes
that you will indicate your vote on the various proposals, date and sign the
enclosed proxy, and return it promptly to the Company in the envelope provided
to assure that your shares are voted in the event you are unavoidably absent.
By Order of the Board of Directors
Ernest C. Jett
Assistant Secretary
Carthage, Missouri
March 31, 1995
13
<PAGE>
NOTE: UNLESS OTHERWISE INDICATED, THIS PROXY SHALL BE DEEMED TO GRANT AUTHORITY
TO VOTE FOR PROPOSALS 1 AND 2 BELOW, AND ON SUCH OTHER MATTERS AS MAY PROPERLY
COME BEFORE THE MEETING.
(1) ELECTION OF DIRECTORS (R. Bentele; H. Cornell, Jr.; R. Enloe, III; R.
Fisher, F. Ford, Jr.; R. Jefferies, Jr.; A. Levine; R. Pearsall; M. Purnell,
Jr.; and F. Wright)
FOR ALL WITHHOLD
NOMINEES AUTHORITY
(except those
listed)
[_] [_]
(INSTRUCTION: To withhold authority to vote for any individual nominee
write that nominee's name in the space provided below.)
__________________________________________________________________________
The Board of Directors recommends a vote FOR all director nominees listed.
(2) Proposal to ratify the selection of Price Waterhouse as the Company's
independent accountants for the Fiscal Year ending December 31, 1995.
FOR AGAINST ABSTAIN
[_] [_] [_]
The Board of Directors recommends a vote FOR Proposal 2
Date Signed: ______________________________, 1995
Signature(s): ___________________________________
_________________________________________________
Please sign exactly as your name appears on this
proxy. If stock is jointly owned, both parties
must sign. Fiduciaries and representatives should
so indicate when signing and when more than one
is named a majority should sign.
PLEASE SIGN, DATE AND RETURN THIS PROXY IMMEDIATELY
. FOLD AND DETACH HERE .
Dear Shareholder:
Enclosed you will find material relative to the Company's 1995 Annual Meeting
of Shareholders, which will be held on May 10, 1995, at the Company's
headquarters in Carthage, Missouri. The Notice of the Annual Meeting and Proxy
Statement describe the business to be transacted at the meeting. The business
includes two proposals of the Board of Directors: the election of directors and
ratification of Price Waterhouse as the Company's independent accountants.
The Board recommends that you vote "FOR" each proposal.
Whether or not you expect to attend the Annual Meeting, please complete and
return promptly the attached proxy in the accompanying envelope, which requires
no postage if mailed in the United States. Your votes are important to us. We
look forward to hearing from you.
<PAGE>
LEGGETT & PLATT, INCORPORATED
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Harry M. Cornell, Jr., Michael A. Glauber and
Ernest C. Jett, or any one of them, with full power of substitution, attorneys
of the undersigned to vote the shares of stock which the undersigned would be
entitled to vote, if personally present, at the Annual Meeting of Shareholders
of Leggett & Platt, Incorporated, to be held at the Company's Corporate Office,
No. 1 - Leggett Road, Carthage, Missouri, on Wednesday, May 10, 1995, at 10:00
a.m., local time, and at any adjournment or adjournments thereof.
(Continued and to be signed on reverse side)
. FOLD AND DETACH HERE .
