[logo]
LIVIO D. DESIMONE
Chairman of the Board and
Chief Executive Officer
March 28, 1994
Dear Stockholder:
You are invited to attend the 1994 Annual Meeting of Stockholders
which will
be held on Tuesday, May 10, 1994, at 10 a.m. at the St. Paul
Civic Center,
143 West Fourth Street, St. Paul, Minnesota.
The notice of the meeting and the proxy statement on the
following pages
cover the formal business of the meeting. The meeting will
consider the
election of directors, the appointment of auditors for the coming
year, and
the proposal of an executive profit sharing plan and amendments
to the
existing performance unit plan. I will also report on current
operations and
on our future plans. There will be a period during which your
questions and
comments will be welcome.
The fine attendance of our stockholders at the annual meetings
over the years
has been very helpful in maintaining communications and
understanding. We
sincerely hope you will be able to be with us.
Please date, sign, and return the enclosed proxy in the envelope
provided. If
you can be with us, PLEASE MARK THE APPROPRIATE BOX ON THE
ENCLOSED PROXY
CARD.
Cordially,
[signature]
MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS TO BE HELD MAY 10, 1994
To the Stockholders of
Minnesota Mining and Manufacturing Company:
The Annual Meeting of Stockholders of Minnesota Mining and
Manufacturing
Company will be held on Tuesday, May 10, 1994, at 10 a.m. at the
St. Paul
Civic Center, 143 West Fourth Street, St. Paul, Minnesota, for
the following
purposes:
1. To elect three directors of the Company to the 1997 Class (see
page 2 of
the Proxy Statement).
2. To ratify the appointment of Coopers & Lybrand, independent
certified
public accountants, to audit the books and accounts of the
Company for the
year 1994 (page 21).
3. To consider approval of an Executive Profit Sharing Plan (page
22).
4. To consider approval of amendments to the Performance Unit
Plan (page 24).
5. To transact such other business as may properly come before
the meeting or
any adjournments thereof.
The Board of Directors has fixed March 11, 1994, as the record
date for the
determination of stockholders entitled to vote at the Annual
Meeting and to
receive notice thereof. The transfer books of the Company will
not be closed.
Examination of the list of stockholders entitled to vote can be
arranged at
the office of Arlo D. Levi, Vice President and Secretary, 3M
Center, St.
Paul, Minnesota, during the period of ten days prior to the
meeting.
STOCKHOLDERS ARE ENCOURAGED TO DATE, SIGN, AND RETURN THE
ENCLOSED PROXY IN
THE ENCLOSED ENVELOPE, TO WHICH NO POSTAGE NEED BE AFFIXED IF
MAILED IN THE
UNITED STATES. IF YOU PLAN TO ATTEND THE MEETING IN PERSON,
PLEASE MARK THE
BOX ON THE ENCLOSED PROXY CARD INDICATING YOUR PLANS TO ATTEND
THE MEETING.
ARLO D. LEVI
Vice President and Secretary
March 28, 1994
MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
March 28, 1994
PROXY STATEMENT FOR 1994 ANNUAL MEETING OF STOCKHOLDERS
This proxy statement is furnished to stockholders by the Board of
Directors
for solicitation of proxies for use at the Annual Meeting of
Stockholders on
Tuesday, May 10, 1994, at 10 a.m., and at all adjournments
thereof, for the
purposes set forth in the attached Notice of Annual Meeting of
Stockholders.
Any proxy given pursuant to this solicitation may be revoked by
the person
giving it at any time before it is exercised in any of the
following ways:
(1) by a written instruction to the Office of the Secretary
reasonably
indicating the stockholder's desire to revoke an existing proxy;
(2) by
signing and returning to the Company a proxy with a more recent
date than
that of the proxy first given; or (3) by signing and returning a
floor ballot
at the meeting of stockholders.
The Company will bear the cost of preparing, printing, and
mailing material
in connection with this solicitation of proxies. In addition to
the use of
the mails, solicitations may be made by regular employees of the
Company
personally and telephonically. The Company intends to reimburse
brokerage
firms, banks, and others for their reasonable out-of-pocket
expenses,
including clerical expenses, in forwarding proxy material to
beneficial
owners of stock or otherwise in connection with this solicitation
of proxies.
The Company has retained Georgeson & Co., Inc. to assist in the
solicitation
at a cost of approximately $15,000, plus reasonable out-of-pocket
expenses.
The Company anticipates that the proxy statement and the form of
proxy
enclosed herewith will first be sent to its stockholders on or
about March
28, 1994.
The Company's Board of Directors has adopted a policy that all
stockholder
meeting proxies, ballots, and tabulations that identify
stockholders are to
be maintained in confidence, and no such document shall be
available for
examination, nor shall the identity and vote of any stockholder
be disclosed,
except as may be necessary to meet applicable legal requirements
and to allow
the inspectors of election to certify the results of the
stockholder vote.
The policy also provides that inspectors of election for
stockholder votes
shall be independent and shall not be employees of the Company.
RECORD DATE AND VOTING SECURITIES
Only stockholders of record at the close of business on March 11,
1994 are
entitled to vote at the Annual Meeting. As of February 28, 1994,
the Company
had outstanding and entitled to vote 212,916,141 shares of common
stock
without par value. These shares and all other share amounts used
in this
proxy statement are on a pre-split basis.
THE COMPANY HAS ANNOUNCED A TWO-FOR-ONE SPLIT TO HOLDERS OF
RECORD OF THE
COMPANY'S COMMON STOCK ON MARCH 15, 1994, WITH DISTRIBUTION BEING
MADE ON OR
ABOUT APRIL 8, 1994. EACH OUTSTANDING SHARE ON THE RECORD DATE OF
MARCH 11,
1994 ENTITLES THE STOCKHOLDER OF RECORD TO ONE VOTE. THE FINAL
TABULATION
WILL REFLECT THE TWO-FOR-ONE STOCK SPLIT, AND DOUBLE THE NUMBER
OF SHARES
SHOWN ON EACH PROXY WILL BE VOTED AS DIRECTED BY STOCKHOLDERS.
DIVIDEND REINVESTMENT PLAN
Shares held for the account of persons participating in the
Company's
dividend reinvestment plan will be voted automatically in
accordance with the
vote indicated by the stockholder of record on the proxy and, if
no choice is
indicated, both record shares and shares held in the Company's
dividend
reinvestment plan will be voted FOR Items 1, 2, 3, and 4. If the
stockholder
does not vote the shares held of record, the individual's shares
held in the
dividend reinvestment account will not be voted.
ITEM 1. ELECTION OF DIRECTORS
NUMBER OF NOMINEES AND CLASSIFICATION
The Restated Certificate of Incorporation of the Company, as
amended, and the
Bylaws of the Company, as amended, provide that the Board of
Directors shall
consist of such number of directors as shall be fixed from time
to time by
resolution of the Board of Directors. At its meeting of February
14, 1994,
the Board of Directors fixed the number of directors constituting
the entire
Board at 12, effective as of the date of the 1994 Annual Meeting.
The Restated Certificate of Incorporation divides the Board into
three
classes. Three directors have terms of office that expire at the
1994 Annual
Meeting, and two of these three directors are standing for
reelection for a
three-year term as members of the 1997 Class. These two directors
are Mr.
Jacobson and Mrs. Peters. Mr. Fisher, a former member of the 1994
Class,
resigned during the past year. Dr. Robertson, whose term expires
in 1994, has
elected to take early retirement and is also not standing for
reelection. Mr.
Eaton, who was elected last year to the 1995 Class, is standing
for election
to the 1997 Class, in order to more nearly equalize the number of
directors
in the respective classes. The remaining four directors in the
1995 Class are
continuing to serve until the 1995 Annual Meeting; and the five
present
directors in the 1996 Class are continuing to serve until the
1996 Annual
Meeting.
All nominees for election to the Board of Directors to the 1997
Class at the
1994 Annual Meeting will be elected for a term of three years and
shall serve
until their terms expire at the 1997 Annual Meeting or until
their successors
are duly elected and have qualified.
The persons named as proxies intend to vote the proxies for the
election of
the three nominees to the Board of Directors or, if any of the
nominees
should be unavailable to serve as a director, an event which is
not
anticipated, the persons named as proxies reserve full discretion
to vote for
any other persons who may be nominated.
INFORMATION AS TO NOMINEES AND INCUMBENT DIRECTORS
The nominees and incumbent directors, their age, principal
occupation or
position with the Company (shown in italics), experience, the
year first
elected as a director, and common stock beneficially owned on
February 28,
1994 are shown on the following pages.
"Shares held" include: stock held in joint tenancy, stock owned
as tenants in
common, stock owned or held by spouse or other members of the
nominee's
household, and stock in which the nominee either has or shares
voting and/or
investment power, even though the nominee disclaims any
beneficial interest
in such stock. Options exercisable within 60 days after February
28, 1994 are
shown separately.
"Shares held as deferred stock" by nonemployee directors
represent the number
of shares of the Company's common stock, as of December 31, 1993,
which the
directors will receive upon termination of membership on the
Board of
Directors for any reason. These shares result from the voluntary
election by
the nonemployee directors to defer the payment of directors fees
otherwise
payable in cash into such deferred stock. No shares of common
stock have as
yet been issued, and the directors have neither voting nor
investment powers
in these shares of deferred stock.
As of February 28, 1994, officers and directors as a group
"owned" 356,571
shares and held options exercisable within 60 days after that
date for
549,463 shares. All officers and directors as a group owned
beneficially less
than five-tenths of one percent (0.5%) of the outstanding common
stock of the
Company.
None of the nominees or incumbent directors is related to any
other nominee
or to any executive officer of the Company or its subsidiaries by
blood,
marriage, or adoption. Except for current employees of the
Company and Mr.
Jacobson, no nominee or incumbent director in the 1995 Class or
the 1996
Class has been an employee of the Company within the past five
years.
During 1993, the Company retained the law firm of Gibson, Dunn &
Crutcher
with regard to various legal matters. Mrs. Peters is a partner in
this firm.
<TABLE>
<S> <C>
Nominees for Election to the 1997 Class:
[photo] LAWRENCE E. EATON, 56, Executive Vice President,
Information, Imaging and Electronic Sector and Corp-
orate Services; Member of the Executive and Finance
Committees. Mr. Eaton joined 3M in 1960 as an engineer in the
Reflective Products Division laboratory and served in
several engineering and manufacturing assignments
until he was named Department Manager of the Pavement
Marketing Products Department. In 1981, Mr. Eaton was
named General Manager of the Safety and Security
Systems Division; in 1982, Division Vice President of the
Safety and Security Systems Division and, later that
year, Division Vice President of the Traffic Control
Materials Division;in 1984, Executive Vice President of
Sumitomo 3M, Ltd.; and in 1986, Group Vice
President, Memory Technologies Group. In 1991, he was
elected Executive Vice President, Information, Imaging
and Electronic Sector and Corporate Services.
Director since 1993
Shares Held 13,281
**Includes 1,005 shares of Profit Sharing Stock held by
the Company and subject to forfeiture.Not included
are options exercisable within 60 days; 1,231 shares at
$72.35 per share; 1,243 shares at $80.40 per share;
1,130 shares at $88.45 per share; 4,482 shares at
$95.75 per share; and 8,267 shares at $108.45 per share.
[photo] ALLEN F. JACOBSON, 67, Director of various companies;
Member of the Board Organization and Compensation
Committees. Mr. Jacobson joined 3M in 1947 and served
in several capacities until he was elected Chairman of
the Board and Chief Executive Officer, in 1986. He
served in this capacity until his retirement from 3M in
1991. Mr. Jacobson is a director of Abbott
Laboratories,Alliant Techsystems,Inc., Deluxe Corporation, Mobil
Corporation, Northern States Power Company, Potlatch
Corporation, Prudential Insurance Company,Sara Lee
Corporation, Silicon Graphics, Inc., U.S. West, Inc.,
and Valmont Industries, Inc. He is Chairman of the
United States Council for International Business. He is
also a member of the National Academy of
Engineering.
Director since 1983
Shares Held 49,130
**Not included are options exercisable within 60 days:
5,253 shares at $72.35 per share; 22,077 shares at
$74.20 per share; 21,457 shares at $80.40 per share;
28,550 shares at $78.15 per share; and 21,570 shares at
$88.45 per share.
[photo] AULANA L. PETERS, 52, Partner, Gibson, Dunn &
Crutcher, a law firm, Los Angeles, California; Member of the
Audit and Public Issues Committees. Mrs. Peters joined
Gibson, Dunn & Crutcher as an Associate in 1973. In
1980, she was named a Partner in the firm and continued
in the practice of law until 1984, when she accepted
an appointment as Commissioner of the Securities and
Exchange Commission. In 1988, after serving four years
as Commissioner, she returned to the private practice
of law as Partner in the Gibson, Dunn & Crutcher firm.
Mrs. Peters is a member of the American and Los Angeles
County Bar Associations; a director of the New York
Stock Exchange, Mobil Corporation, and Northrop
Corporation.
Director since 1990
Shares Held 321
Shares Held as Deferred Stock 1,667
Incumbent Directors in the 1995 Class:
[photo] EDWARD A. BRENNAN, 60, Chairman of the Board,
President, and Chief Executive Officer, Sears, Roebuck and
Co., a diversified company engaged in merchandising,
insurance, and real estate, Chicago, Illinois; Chairman
of the Compensation and Member of the Public Issues
Committees. Mr. Brennan has been a director of Sears,
Roebuck and Co. since 1978. He joined Sears in 1956;
was an Executive Vice President, 1978 to 1980;
President and Chief Operating Officer for
merchandising, 1980; Chairman and Chief Executive Officer, Sears
Merchandise Group, 1981 to 1984; President and Chief
Operating Officer, 1984 through 1985; and was elected
Chairman and Chief Executive Officer of Sears, Roebuck
and Co. in 1986. He is a director of The Allstate
Corporation, Dean Witter,Discover & Co., and AMR
Corporation. He is also a trustee of DePaul University and
Marquette University; and a member of the Business
Roundtable and the Business Council.
Director since 1986
Shares Held 2,187
Shares Held as Deferred Stock 488
[photo] LIVIO D. DESIMONE, 57, Chairman of the Board and
Chief Executive Officer; Chairman of the Board
Organization, Executive, and Finance Committees. Mr.
DeSimone joined 3M as a process engineer with 3M Canada
in 1957. He served in various international and
subsidiary capacities until his appointment in 1971 as
Managing Director of 3M Brazil. In 1975, he served as
General Manager, Building Service and Cleaning
Products Division, before being appointed Area Vice
President, Latin America. Mr. DeSimone was elected Vice
President, Abrasives, Adhesives, Building Service and
Chemicals Group, in 1979; Executive Vice President,
Life Sciences Sector, in 1981; Executive Vice
President, Industrial and Consumer Sector, in 1984; Executive
Vice President, Industrial and Electronic Sector, in
1987; Executive Vice President, Information and Imaging
Technologies Sector, in 1989; and Chairman of the Board
and Chief Executive Officer, in 1991. He is a
director of Cargill, Incorporated, Cray Research, Inc.,
Dayton Hudson Corporation, General Mills, Inc., and
Vulcan Materials Company. He is also Chairman of
National Junior Achievement Inc. and a trustee of the
University of
Minnesota Foundation.
Director since 1986
Shares Held 49,939
**Includes 23,046 shares of Profit Sharing Stock held
by the Company and subject to forfeiture. Not included
are options exercisable within 60 days: 1,569 shares at
$63.70 per share; 1,382 shares at $72.35 per share;
1,243 shares at $80.40 per share; 1,130 shares at
$88.45 per share; 15,396 shares at $95.75 per share; and
19,583 shares at $103.90 per share.
[photo] ALLEN E. MURRAY, 65, Retired Chairman of the Board
and Chief Executive Officer, Mobil Corporation,
petroleum exploration and manufacturing and marketing
of petroleum and petroleum-based products, Fairfax,
Virginia; Chairman of the Audit and Member of the Board
Organization Committees. Mr. Murray has been a
director of Mobil Corporation from 1977, was Chairman
of the Board, President, and Chief Executive Officer
from 1986 until 1993, and Chairman and Chief Executive
Officer until March 1994. He retired from Mobil this
year. He is a director of Metropolitan Life Insurance
Company, Martin Marietta Corporation, and Morgan
Stanley Group, Inc. He is also a director of the
American Petroleum Institute, a trustee of New York
University, and a member of the Chase Manhattan Bank
International Advisory Committee, The Business Council,
The Business Roundtable, the Council on Foreign
Relations, and the Trilateral
Commission.
Director since 1985
Shares Held 1,211
Shares Held as Deferred Stock 4,922
[photo] F. ALAN SMITH, 62, Retired Executive Vice President
and Director, General Motors Corporation, manufacturer
and seller of automobiles and automotive products,
Detroit, Michigan; Member of the Audit and Board
Organization Committees. Mr. Smith had been a director
of General Motors Corporation from 1981 until his
retirement during 1992. He joined General Motors in
1956; was Treasurer, 1973 to 1975; Vice President,
Finance, 1975 to 1978; Vice President of General Motors
Corporation and President and General Manager of
General Motors of Canada Limited, 1978 to 1981, when he
was elected Executive Vice President, Finance. In
1988, he was elected Executive Vice President,
Operating Staffs and Public Affairs and Marketing Staffs. In
1992, Mr. Smith retired from General Motors. He is a
Trustee of the Cranbrook Educational Community,
Bloomfield Hills, Michigan.
Director since 1986
Shares Held 2,511
Shares Held as Deferred Stock 2,071
Incumbent Directors in the 1996 Class:
[photo] HARRY A. HAMMERLY, 60, Executive Vice President, Life
Sciences Sector and International Operations; Member
of the Executive and Finance Committees. Mr. Hammerly
joined 3M in 1955 as an accountant in the Controller's
organization. He was named Managing Director of 3M Far
East in Hong Kong in 1973; Senior Managing Director
of Sumitomo 3M in 1975; and in 1979, he was appointed
Area Vice President, Latin America. In 1981, Mr.
Hammerly was elected Vice President, Australia, Asia,
Canada; in 1982, Vice President, Finance; in 1987,
Vice President, Europe; in 1989, Executive Vice
President, Industrial and Electronic Sector; and, in 1991,
Executive Vice President, International Operations and
Corporate Services. In 1994, he was elected Executive
Vice President, Life Sciences Sector and International
Operations. Mr. Hammerly is a director of Cincinnati
Milacron, Inc., The Geon Company, and the National
Association of Manufacturers; and a member of the Board
of Trustees of the University of St. Thomas and the
Manufacturers Alliance for Productivity and Innovation.
Director since 1990
Shares Held 20,390
**Includes 5,088 shares of Profit Sharing Stock held by
the Company and subject to forfeiture.Not included
are options exercisable within 60 days: 2,075 shares at
$87.90 per share; 9,346 shares at $93.50 per share;
10,170 shares at $88.45 per share; 10,256 shares at
$95.75 per share; and 9,834 shares at $108.45 per share.
[photo] RONALD A. MITSCH, 59, Executive Vice President,
Industrial and Consumer Sector and Corporate Services;
Member of the Executive and Finance Committees. Dr.
Mitsch joined 3M in 1960 as a senior chemist in the
central research laboratories and served in several
laboratory assignments until he was named Managing
Director of 3M Netherlands in 1979. In 1981, Dr. Mitsch
was named Research and Development Vice President
for the Life Sciences Sector; in 1985, Group Vice
President for the Traffic and Personal Safety Products
Group; and in 1990, Senior Vice President, Research and
Development. In 1991, he was elected Executive Vice
President, Industrial and Consumer Sector and Corporate
Services. Dr. Mitsch is a director of Lubrizol
Corporation, Shigematsu Works, Inc., Ltd., and the SEI
Center for Advanced Studies in Management; and a
member of the Board of Trustees of Hamline University.
Director since 1993
Shares Held 11,181
**Includes 1,260 shares of Profit Sharing Stock held by
the Company and subject to forfeiture. Not included
are options exercisable within 60 days: 1,697 shares at
$58.90 per share; 1,569 shares at $63.70 per share;
1,382 shares at $72.35 per share; 1,243 shares at
$80.40 per share; 1,130 shares at $88.45 per share; 2,327
shares at $90.85 per share; 11,300 shares at $95.75 per
share; and 5,877 shares at $108.45 per share.
[photo] ROZANNE L. RIDGWAY, 58, Co-Chair, The Atlantic
Council of the United States, an association to promote
better understanding of major international security,
political, and economic problems, Washington, D.C.;
Member of the Board Organization and Compensation
Committees. Ambassador Ridgway served in the U.S. Foreign
Service from 1957 to 1989, including assignments as
Ambassador for Oceans and Fisheries Affairs, Ambassador
to Finland, Counselor of the Department of State,
Ambassador to the German Democratic Republic, and from
1985 and until her retirement in 1989, Assistant
Secretary of State for European and Canadian Affairs. She
became President of the Atlantic Council of the United
States in 1989 and was named Co-Chair in 1993. She is
a director of Bell Atlantic Corporation, The Boeing
Company, Citicorp, RJR Nabisco, Sara Lee Corporation,
and Union Carbide; a member of the International
Advisory Board of the New Corporation; Vice Chairman, the
American Academy of Diplomacy; a director of the
Council on Ocean Law; and a Fellow, the National Academy of
Public Administration.
Director since 1989
Shares Held 330
Shares Held as Deferred Stock 1,997
[photo] FRANK SHRONTZ, 62, Chairman of the Board and Chief
Executive Officer, The Boeing Company, manufacturer and
seller of aircraft and related products; Member of the
Compensation and Public Issues Committees. Mr.
Shrontz joined The Boeing Company in 1958. In 1973, he
took leave of absence from Boeing to serve as
Assistant Secretary of the Air Force and became
Assistant Secretary of Defense in 1976. In 1977, Mr. Shrontz
returned to Boeing. After several assignments, he was
named President and a member of the Board of Directors
of Boeing in 1985. In 1986, he was named Chief
Executive Officer and, in 1988, Chairman of the Board. Mr.
Shrontz is a director of Boise Cascade Corporation and
Citicorp. He is a member of the Washington Roundtable
and Vice Chairman of the New American Schools
Development Corporation. He is also a member of the Advisory
Committee for Trade Policies and Negotiations, the
Defense Policy Advisory Committee on Trade (DPACT), the
Business Council, and the Policy Committee of the
Business Roundtable.
Director since 1993
Shares Held 1,056
[photo] LOUIS W. SULLIVAN, 60, President, Morehouse School of
Medicine, Atlanta, Georgia; Member of the Audit and
Public Issues Committees. Since completion of his
medical training, Dr. Sullivan has held both professional
and administrative positions in health care facilities
and medical training institutions. He joined
Morehouse College as Professor of Biology and Medicine
in 1975 and was the founding dean and director of the
Medical Education Program at the college. He was named
President of Morehouse School of Medicine in 1981. He
served as Secretary, United States Department of Health
and Human Services from 1989 to 1993. He returned to
Morehouse School of Medicine in 1993. Dr. Sullivan is a
director of Bristol-Myers Squibb Company, CIGNA
Corporation, General Motors Corporation, Household
International, and Medical Review Systems, Inc. He is
also a director of the Boy Scouts of America and the
Friends of the National Library of Medicine; and a
member of the Little League Foundation and the National
Medical Foundation.
Director since 1993
Shares Held 217
</TABLE>
Compensation Committee Report on Executive Compensation
This report was prepared at the direction of the Compensation
Committee of
the Board of Directors (the "Committee") which is composed
entirely of
non-employee directors of the Company. The Committee establishes
and
periodically reviews compensation levels and policies for the CEO
and other
executive officers, and authorizes short and long-term
compensation in the
form of cash or stock. The current members of the Committee are
Edward A.
Brennan, who serves as Chairman, Allen F. Jacobson, Rozanne L.
Ridgway and
Frank Shrontz.
In determining the amount and type of executive compensation, the
Committee
seeks to achieve the following objectives: (1) attract, motivate
and retain
talented, competent and resourceful executive officers by
providing
competitive compensation; (2) encourage executives to hold
significant
amounts of stock; and (3) require that a substantial portion of
executive
compensation is variable and "at risk" by being tied to
quantifiable
short-term and long-term measures of the Company's performance.
Executive
compensation is based on performance of the Company against a
combination of
financial and non-financial criteria, ranging from achieving
earnings and
sales growth targets to upholding the Company's Statement of
Corporate Values
(which include customer satisfaction through superior quality and
value,
attractive investor return, ethical business conduct, respecting
the
environment and fostering employee pride in the Company).
The Committee begins the process of establishing the amount of
compensation
for the CEO and other executive officers by reviewing
compensation surveys of
selected peer companies. The surveys are primarily conducted by
independent
consultants specializing in executive compensation. The peer
companies
included in the compensation surveys are selected by the
independent
consultants. These peer companies consist of large industrial
companies which
are most likely to be competitors for executive talent. Several
different
surveys have been utilized which include groups of twenty five
(25) to
seventy five (75) different companies. The objective of the
Committee is to
use the survey data to establish the amount of total compensation
at a
competitive level. The Committee does not target any specific
quartile of the
survey data for total compensation or any component of total
compensation
(e.g., Base Salary, Profit Sharing, Performance Unit Plan or
Stock Options).
The Committee's objective of achieving the total compensation at
a
competitive level has resulted in short-term compensation (base
salary and
profit sharing) falling slightly below the median and long-term
compensation
(performance unit plan and stock options) falling at or slightly
above the
median. The Committee believes that the Company's most direct
competitors for
executive talent are not necessarily all of the companies that
would be
included in a peer group established to compare shareholder
returns. Thus,
the peer group for purposes of the compensation surveys is not
the same as
the peer group index in the Comparison of Five Year Cumulative
Total Return
graph included on page 20 of this Proxy Statement.
After the Committee has established the amount of total
compensation for the
CEO and other executive officers, the Committee next determines
what percent
of the total compensation for a particular individual should be
allocated to
short-term compensation in the form of base salary and profit
sharing, and
long-term compensation in the form of the performance unit plan
and stock
options. This determination is subjective but is based on
information from
the compensation surveys and the objectives for executive
compensation
referred to above. It is the Committee's long-standing policy
that variable,
at risk compensation, both short and long-term, should make up a
significant
portion of executive compensation. Depending upon the level of
the executive,
the Committee targets between forty five percent (45%) and sixty
five percent
(65%) of executive compensation to be variable and at risk by
being tied to
quantifiable measures of the Company's performance. Because
performance-based
compensation is such a significant part of executive
compensation, it is the
policy of the Committee to maximize the deductibility of the
performance-based compensation (e.g., profit sharing, performance
unit plan
and stock options) paid to the CEO and other executive officers
under Section
162(m) of the Internal Revenue Code. Technical amendments may be
necessary to
insure the Company's performance-based compensation plans conform
to the
requirements of Section 162(m). However, none of the proposed
amendments
would have had any effect on 1993 awards. Each of the components
of short-
and long-term executive compensation is described in greater
detail below.
BASE SALARY
The Committee establishes base salaries annually in relation to
base salaries
paid by the selected peer companies from the compensation
surveys. Base
salaries may be adjusted from time to time according to
guidelines
established for all employees to reflect increased salary levels
within the
peer group, increased responsibilities, or individual
performance. The
Committee does not use financial performance factors, such as
earnings per
share, in establishing Base Salary. This is the only component of
executive
compensation that is not variable.
PROFIT SHARING
Profit sharing is variable compensation based on the quarterly
consolidated
net income of the Company and is used to focus management
attention on
profits and the effective use of assets. The number of profit
sharing units
granted to the CEO and executive officers is determined by the
Committee as
part of the overall compensation. The number of profit sharing
units
allocated to each of the named executive officers is established
by the
Committee, in the exercise of its collective judgment, to achieve
the
appropriate ratio between short-term performance-based
compensation and other
forms of compensation and to reflect the level of responsibility
of the
respective executive officer. The amount payable with respect to
each profit
sharing unit is determined by dividing the Company's consolidated
quarterly
net income, less a quarterly reserve of two and one-half percent
(21/2%) of
stockholders' equity (or approximately ten percent (10%) on an
annual basis),
by the number of outstanding shares of the Company's common
stock. Because of
the required minimum return on stockholder equity, the amount of
compensation
paid under the profit sharing plan tends to rise and fall
relatively more
sharply than changes in net income. No amount will be payable
under the
profit sharing plan if the Company's quarterly net income is
equal to or less
than the quarterly reserve of two and one-half percent (21/2%)
return on
stockholders' equity. Profit sharing payments are subject to
limitations when
individual amounts exceed specified relationships to Base Salary.
For the
executive officers listed in the Summary Compensation Table, a
portion of
profit sharing is paid in cash and a portion is paid in stock
which is held
by the Company for ten years or until age 65, whichever occurs
first. The
ratio between that portion of profit sharing paid in cash and the
portion
paid in stock to the named executive officers for 1993 is
subjective and
varies from year to year and among executive officers. However,
the more
senior executive officers have generally been paid a larger
portion of profit
sharing in stock than less senior executive officers. (The
Company's Profit
Sharing Plan is more fully described on pages 12 and 22-24 of
this Proxy
Statement).
PERFORMANCE UNIT PLAN
The Performance Unit Plan is variable compensation based on the
Company's
long-term performance. The number of performance units allocated
to each of
the named executive officers is established by the Committee, in
the exercise
of its collective judgment, to achieve the appropriate ratio
between
long-term performance-based compensation and other forms of
compensation. The
number of performance units granted to the CEO and executive
officers is
determined by the Committee as part of the overall compensation.
The amount
payable with respect to each performance unit granted is
determined by and is
contingent upon attainment of the performance criteria described
below over
the performance period 1993-1995 (each year weighted equally).
The
performance criteria have been selected to focus management
attention on the
quality of future earnings and assets and on global real sales
growth. (The
Company's Performance Unit Plan is more fully described on pages
17-18 and 24
of this Proxy Statement.)
PERFORMANCE CRITERIA:
(1) "Relative ROCE" - is the percentage determined by dividing
the Company's
average return on capital employed by the average return on
capital employed
of the companies included, at the end of each year of the
performance period,
in the Standard and Poor's Industrial Index ("S&P 400 ROCE"); and
(2) "Sales Growth" - is the percentage amount by which the
Company's real
sales growth (sales growth adjusted for inflation and currency
effects)
exceeds the weighted average of real growth reflected by the
Industrial
Production Index for seven major industrial countries (the "Big 7
IPI").
PERFORMANCE UNIT PLAN PAYMENTS:
The amount payable with respect to each performance unit is $100
if both the
Relative ROCE and Sales Growth targets are achieved and is
payable on January
1, 1999 in the form (at the discretion of the Committee) of cash,
stock or a
combination of cash and stock. The maximum amount payable with
respect to
each performance unit is $200. No amount will be payable under
the
performance unit plan if either the Company's cumulative ROCE is
less than
one hundred fifty (150%) of the S&P 400 ROCE or if Sales Growth
(as defined
above) is less than zero percent (0%).
STOCK OPTIONS
The Company's Stock Option plan is also variable compensation
based on the
market appreciation of the Company's Common Stock and is designed
to increase
ownership of the Company's stock. The Company makes stock option
grants
annually at one hundred percent (100%) of the market price on the
date of
grant. The options may be exercised after one year and have a ten
year life.
The number of shares under options to be granted to the CEO and
executive
officers is determined by the Committee as part of the overall
compensation.
The awards are designed to keep total compensation competitive
with awards
made by companies in the survey group, and as such require
subjective
judgment as to the value of the award. The number of option
shares currently
held by each executive is not considered in determining awards.
Stock options
encourage executives to become owners of the Company which
further aligns
their interests with the shareholders. Options have no value
unless the price
of the Company's stock increases.
CHIEF EXECUTIVE OFFICER COMPENSATION
The compensation of Livio D. DeSimone, Chairman of the Board and
Chief
Executive Officer, is determined by the same process and consists
of the same
short- and long-term components as for the other executive
officers listed in
the Summary Compensation Table, namely base salary, profit
sharing,
performance unit plan and stock options. The only difference is
that a higher
portion of Mr. DeSimone's total compensation is variable and at
risk by being
tied to quantifiable measures of the Company's performance. These
measures
are quarterly net income, Relative ROCE and Sales Growth, as
those terms are
defined above, and appreciation in the value of 3M stock. In
addition, the
compensation paid to Mr. DeSimone is also based on performance
against
non-financial measures, such as upholding the Company's Statement
of
Corporate Values (which include customer satisfaction through
superior
quality and value, attractive investor return, ethical business
conduct,
respecting the environment and fostering employee pride in their
company),
management succession planning and the general overall perception
of the
Company by financial and business leaders. In order to keep Mr.
DeSimone's
total compensation competitive, the Committee increased his base
salary in
1992 which is reflected in the Summary Compensation Table on page
11 of this
Proxy Statement as a higher base salary for 1993. The Committee
did not
increase his base salary or the number of profit sharing units in
1993.
Because of increased earnings in 1993, Mr. DeSimone's profit
sharing cash and
profit sharing stock was greater in 1993 than in 1992. The
Committee awarded
Mr. DeSimone the same number of performance units (7,700) and
stock options
(22,700) as it awarded him in 1992.
The Compensation Committee
Edward A. Brennan, Chairman
Allen F. Jacobson
Rozanne L. Ridgway
Frank Shrontz
EXECUTIVE COMPENSATION
The following tabulation shows compensation for services rendered
in all
capacities to the Company and its subsidiaries during 1993, 1992,
and 1991 by
the Chief Executive Officer and the next four highest-paid
executive
officers.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual
Compensation (1)
Profit
Sharing Other Annual
Salary Cash
(Bonus) Compensation
Name and Principal Position Year ($) ($)(2)
($)(4)
<S> <C> <C> <C>
<C>
Livio D. DeSimone, 1993 $759,600 $248,130
$--
Chairman of the Board and 1992 742,400 225,524
52,170
Chief Executive Officer 1991 540,120 145,204
--
(Effective November 1, 1991)
Jerry E. Robertson, 1993 446,400 175,897
--
Executive Vice President 1992 446,400 169,198
--
1991 433,440 132,079
--
Harry A. Hammerly, 1993 441,600 161,009
--
Executive Vice President 1992 441,600 154,876
--
1991 408,000 143,373
--
Ronald A. Mitsch, 1993 393,000 187,476
--
Executive Vice President 1992 375,400 163,007
--
(Effective August 1, 1991) and 1991 267,340 129,994
--
Senior Vice President (Until
July 31, 1991)
Lawrence E. Eaton, 1993 390,000 186,925
--
Executive Vice President 1992 375,200 159,678
--
(Effective September 1, 1991) 1991 258,240 132,688
--
</TABLE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term
Compensation (1)
Awards
Payouts
Profit Sharing
Stock Options
Performance
(Restricted Granted
Unit Plan All Other
Stock Awards) (# - Number
(LTIP) Compensation
Name and Principal Position ($)(2)(3) of
Shares)(5) Payouts ($)(6) ($)(7)
<S> <C> <C>
<C> <C>
Livio D. DeSimone, $330,013 42,283
$550,800 $54,595
Chairman of the Board and 317,444 40,465
507,500 34,414
Chief Executive Officer 293,864 11,300
540,800 --
(Effective November 1, 1991)
Jerry E. Robertson, 237,653 24,797
550,800 54,595
4,595
Executive Vice President 228,602 22,825
507,500 34,414
211,621 20,181
540,800 --
Harry A. Hammerly, 105,455 21,134
550,800 54,595
Executive Vice President 101,439 20,646
507,500 22,781
84,943 18,226
540,800 --
Ronald A. Mitsch, 55,953 17,177
275,400 13,828
Executive Vice President 38,040 15,719
130,500 9,275
(Effective August 1, 1991) 21,290 8,596
135,200 --
and Senior Vice President
(Until July 31, 1991)
Lawrence E. Eaton, 51,931 19,567
145,350 13,828
Executive Vice President 37,114 16,772
130,500 9,275
(Effective September 1, 1991) 12,780 4,800
135,200 --
</TABLE>
(1) The amounts shown in the Summary Compensation Table do not
include
amounts expensed for financial reporting purposes under the
Company's pension
plan. The plan is a defined benefit plan. The amounts shown in
the Table do,
however, include those amounts voluntarily deferred by the named
individuals
under the Company's Deferred Compensation Plan. The Deferred
Compensation
Plan allows management personnel to defer portions of current
base salary,
profit sharing, and performance unit compensation otherwise
payable during
the year.
(2) The amounts shown under the headings "Profit Sharing Cash
(Bonus)" and
"Profit Sharing Stock (Restricted Stock Awards)" are payments
received under
the Profit Sharing Plan. The terms "(Bonus)" and "(Restricted
Stock Awards)"
are included to satisfy the requirements of the Securities and
Exchange
Commission ("SEC"). These payments are based upon the Company's
performance
and are variable in accordance with a predetermined formula. The
Compensation
Committee does not view these payments as bonus payments or
restricted stock
awards as these terms are most often used. The Committee views
bonus plans as
plans which provide for annual (as opposed to quarterly) payments
from a pool
rather than based on a strict formula related to earnings per
share, and
restricted stock awards are generally outright grants of stock as
opposed to
payment in the form of stock held in the custody of the company
(restricted
period) in lieu of cash under a formula based profit sharing
plan.
Generally, profit sharing is paid in cash; however, senior
executive
management, as determined by the Compensation Committee, receive
a portion of
their profit sharing in shares of the Company's common stock (see
footnote 3
on this page).
The Company's profit sharing plan provides for quarterly payments
based upon
net income after deducting an allowance for a predetermined 10%
annual rate
of return on stockholder equity and is determined by multiplying
the number
of profit sharing units awarded to an individual by this
quarterly net income
divded by the number of the outstanding shares of the Company's
Common Stock.
Because of the required minimum return on stockholder equity,
profit sharing
tends to rise and fall relatively more sharply than changes in
net income.
The number of profit sharing units awarded to the individuals
named is
determined by the Compensation Committee and is intended to
reflect the level
of responsibility of the respective individual. Profit sharing
payments are
subject to limitations when individual amounts exceed specified
relationships
to base salary. Approximately 4,300 management employees
currently
participate in profit sharing, including the five individuals in
the summary
compensation table.
(3) The amount shown under the heading "Profit Sharing Stock
(Restricted
Stock Awards)" represents the portion of profit sharing issued as
common
stock to the named individuals, valued at 100% of the fair market
value on
the date issued. The number of shares is determined by the
Company's
quarterly net income performance. However, payment is deferred
and
conditional upon continued employment by the Company. Therefore,
pursuant to
SEC rules, it is included under the headings of "Long Term
Compensation."
The shares are held in the custody of the Company for a period of
ten years
or to retirement at age 65, whichever occurs first. Any
termination of
employment, prior to that time, without the consent of the
Compensation
Committee or the Board of Directors, other than upon death or
permanent
disability, will result in forfeiture of the Profit Sharing
Stock. The
recipient is entitled to receive dividends and vote these shares
in the same
manner as any other holder of the Company's common stock during
the period of
custody by the Company.
From the time of issuance throughout the Restricted Period,
Profit Sharing
Stock rises or falls in value in direct relationship to the
Company's common
stock market performance. Consequently, Profit Sharing Stock
reflects both
short-term and long-term performance elements.
The named individuals have accumulated, in several cases over six
years, the
following shares of the Company's common stock under the
Company's profit
sharing plan as of December 31, 1993, valued for these purposes
at the fair
market value of such stock on December 31, 1993, and also on the
respective
dates when the shares were issued into the custody of the
Company:
<TABLE>
<CAPTION>
Value Value
Name Shares at 12/31/93 When Issued
<S> <C> <C> <C>
L.D. DeSimone 23,046 $2,506,253 $1,930,567
J.E. Robertson 14,582 1,585,793 1,243,633
H.A. Hammerly 5,088 553,320 461,120
R.A. Mitsch 1,260 137,025 124,434
L.E. Eaton 1,005 109,294 101,739
</TABLE>
(4) "Other Annual Compensation" includes the following, to the
extent that
the aggregate thereof exceeds $50,000: personal benefits received
by the
named individuals, amounts reimbursed the individuals during the
year for
payment of taxes, and that portion of interest above market rates
(as
determined by the Securities and Exchange Commission) earned on
that
compensation voluntarily deferred by the individuals. The
personal benefits
included in these numbers represent the amount of personal
financial planning
services and personal air travel on corporate aircraft imputed to
the
individual as income for tax purposes. In the case of Mr.
DeSimone, ninety
four percent (94%) of the "Other Annual Compensation" received in
1992 was a
result of income imputed to him for travel.
(5) The number of stock options shown in this column includes
both annual
grants of incentive and nonqualified stock options and
Progressive Stock
Options, which are described more fully in footnote 1 on page 16.
(6) "LTIP Payouts" reflects the value of the total grant for each
individual
after the three year performance period (e.g., for 1993, the
performance
period is 1991-1993), but no amount will be paid to these
individuals under
the grant for an additional three years pursuant to the terms of
the grant.
The numbers shown represent estimates based upon information
available as of
February 28, 1994. During this additional three year period,
interest will be
paid at a rate determined by the Company's ROCE performance.
(7) "All Other Compensation" includes that amount of Performance
Unit Plan
earnings allocated during the year to the base amounts determined
after the
three-year performance periods of each respective grant, to the
extent that
such earnings are in excess of market interest rates (as
determined by the
Securities and Exchange Commission).
STOCK OPTIONS TABLE
The following tabulation shows for each person named in the
Summary
Compensation Table the specified information with respect to
option grants
during 1993.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants
% of Total
Grant Date
Options/ Options/SARs
Value
SARs Granted
Exercise or Grant Date
Granted (#) to Employees in
Base Price Expiration Present Value ($)
Name (1) Fiscal Year
($/Sh) (2) Date (4)
<S> <C> <C>
<C> <C> <C>
L.D. DeSimone 22,700 1.062%
$113.25 5-11-2003 $ 473,295
2,832 0.132
103.90 5-06-1999 31,577
7,639 0.357
103.90 5-05-2000 85,175
9,112 0.426
103.90 5-14-2001 101,599
J.E. Robertson 11,300 0.529
113.25 5-11-2003 235,605
89 0.004
108.45 5-06-1994 1,045
427 0.020
108.45 5-12-1995 5,013
6,505 0.304
108.45 5-06-1999 76,369
3,116 0.146
108.45 5-05-2000 36,582
3,360 0.157
108.45 5-14-2001 39,446
H.A. Hammerly 11,300 0.529
113.25 5-11-2003 235,605
1,661 0.078
108.45 5-08-1998 19,500
2,544 0.119
108.45 5-06-1999 29,867
5,629 0.263
108.45 5-05-2000 66,084
R.A. Mitsch 11,300 0.529
113.25 5-11-2003 235,605
1,734 0.081
108.45 5-09-1997 20,357
948 0.044
108.45 5-06-1999 11,130
3,195 0.149
108.45 5-14-2001 37,509
L.E. Eaton 11,300 0.529
113.25 5-11-2003 235,605
2,258 0.106
108.45 5-09-1997 26,509
216 0.010
108.45 5-08-1998 2,536
2,598 0.122
108.45 5-06-1999 30,501
3,195 0.149
108.45 5-14-2001 37,509
All Optionees (4,355
Participants) 2,138,014 100.000%
113.25(2) 5-10-2003(3) $42,233,461
</TABLE>
(1) The Company does not grant any stock appreciation rights
(SARs). The
options shown for each individual include both annual grants of
Incentive
Stock Options and nonqualified stock options and grants of
Progressive Stock
Options ("PSO"). The first grant shown for each individual is the
annual
grant. The remaining lines are PSOs. The PSO grants for each
individual were
made on a single date, but are, pursuant to SEC rules, shown in
multiple
lines because of different expiration dates.
PSO grants were made to participants who exercised nonqualified
stock
options and who made payment of the purchase price using shares
of previously
owned Company common stock. The PSO grant is for the number of
shares equal
to the shares utilized in payment of the purchase price and tax
withholding,
if any. The option price for the PSO is equal to 100% of the
market value of
the Company's common stock on the date of the exercise of the
primary option.
The option period is equal to the remaining period of the options
exercised.
Company common stock used for payment must have been owned by
the
participant for at least six months, and only one exercise of
nonqualified
options per participant per calendar year will be eligible for
PSO grants by
the Committee.
The presence of PSOs encourages early exercise of nonqualified
stock
options, without foregoing the opportunity for further
appreciation, and
promotes retention of the Company stock acquired.
In any event, a participant receiving an annual grant of
nonqualified stock
options can never acquire more shares of Company common stock
through
successive exercises of the initial and subsequent PSO grants
than the number
of shares covered by the initial annual grant from the Committee.
(2) All options granted during the period were granted at the
market value on
the date of grant, or the date of exercise of the primary option
in the case
of Progressive Stock Options, as calculated from the average of
the high and
low prices reported on the New York Stock Exchange Composite
Index. The
option price shown for the "All Optionees" line is $113.25 since
the vast
majority of options granted during 1993 carried that price.
(3) The expiration date for the "All Optionees" line is shown as
May 10,
2003, since that is the applicable date for the vast majority of
options
granted during 1993.
(4) Pursuant to the rules of the Securities and Exchange
Commission, the
Company has elected to provide a grant date present value for
these option
grants determined by a modified Black-Scholes or binomial option
pricing
model. Among key assumptions utilized in this pricing model were:
(i) that
the time of exercise of Incentive Stock Options would be four
years, and of
PSOs would be two years, into the term of the option, which could
be for
terms as long as ten years, in recognition of the historical
exercise
patterns at the Company for these types of options; (ii) expected
volatility
of 17.3%; (iii) risk-free rate of return of 3.5% for two years,
and 5% for
four years; and (iv) dividend growth rate of 8.6%. No adjustments
for
non-transferability or risk of forfeiture have been made. The
Company voices
no opinion that the present value will, in fact, be realized and
expressly
disclaims any representation to that effect.
OPTION EXERCISES AND YEAR-END VALUE TABLE
The following tabulation shows for each person named in the
Summary
Compensation Table the specified information with respect to
option exercises
during 1993 and the value of unexercised options at the end of
1993.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR, AND FY-END OPTION VALUE
Shares
Value of Unexercised
Acquired Number of
Unexercised In-the-Money Options
on Exercise Value Realized Options at
FY-End (#) at FY-End ($)(1)
Name (#) ($)(1) Exercisable
Unexercisable Exercisable Unexercisable(2)
<S> <C> <C> <C>
<C> <C> <C>
L.D. DeSimone 1,033 $ 15,288 67,185
22,700 $943,058 --
J.E. Robertson 22,524 678,954 52,456
11,300 657,154 --
H.A. Hammerly 14,118 396,454 45,784
11,300 625,239 --
R.A. Mitsch 9,741 297,666 32,292
11,300 560,786 --
L.E. Eaton 9,418 176,012 28,553
11,300 337,636 --
</TABLE>
(1) The "Value Realized" or the unrealized "Value of Unexercised
In-the-Money
Options at FY-End " represents the aggregate difference between
the market
value on the date of exercise or at December 31, 1993, in the
case of the
unrealized values, and the applicable exercise prices. These
differences
accumulate over what may be, in many cases, several years. These
stock
options all have option periods of ten years when first granted,
and
Progressive Stock Options have option periods equal to the
remaining option
period of the initial nonqualified options resulting in
Progressive Stock
Options.
(2) This column reflects that the fair market value at December
31, 1993,
was lower than the option price of the options not exercisable at
that date.
LONG-TERM INCENTIVE PLAN AWARDS TABLE
The following tabulation shows for each person in the Summary
Compensation
Table the specified information with respect to awards during
1993 under the
Company's Performance Unit Plan.
<TABLE>
<CAPTION>
LONG-TERM INCENTIVE PLAN AWARDS
IN LAST FISCAL YEAR
Estimated Future Payouts
under
Non-Stock Price Based Plans(3)
Performance or
Number of Other Period
Shares, Units Until
or Other Maturation
Name Rights (#)(1) or Payout (2) Threshold
($) Target ($) Maximum ($)
<S> <C> <C> <C>
<C> <C>
L.D. DeSimone 7,700 6 years $0
$770,000 $1,540,000
J.E. Robertson 3,700 6 years 0
370,000 740,000
H.A. Hammerly 3,700 6 years 0
370,000 740,000
R.A. Mitsch 3,700 6 years 0
370,000 740,000
L.E. Eaton 3,700 6 years 0
370,000 740,000
</TABLE>
(1) The Company's Performance Unit Plan provides long-term
compensation to
approximately 150 key management personnel based upon the
Company's
attainment of long-term performance and growth criteria.
It is administered by the Compensation Committee, none of the
members of
which are current employees of the Company. The Committee has
sole discretion
in the selection of participants, performance criteria, size of
awards,
performance period, and the timing and form of payment, as well
as all other
conditions regarding awards.
To date, the Committee has established the performance goals
based on
criteria of return on capital employed and sales growth. More
detail about
current performance goals is available in the Compensation
Committee Report
on page 9. Performance units awarded to date have been assigned a
face value
of $100 each. However, the actual amount of the payments is based
upon the
Company's attainment of the performance goals. If the targets
established by
the Committee are attained during the performance periods, the
performance
unit will have a value of $100 at the end of the performance
period. If the
target is not attained, the value will be less than $100 and, if
exceeded,
will be more than $100. The ultimate value of the performance
unit can vary
from no value to $200, depending upon actual performance.
Payment is contingent upon continued employment to the payment
date or
earlier retirement under the Company's pension plan. Participants
receiving
awards during 1993, including the five executive officers in the
Summary
Compensation Table, will receive payment in 1999, provided that
such
individuals continue employment with the Company until such
payment date
(except in the event of death, retirement, or disability).
Payment under the
Plan may be made in cash, shares of the Company's common stock,
or any
combination of cash and stock, at the discretion of the
Compensation
Committee. In the past, payment has only been made in cash.
(2) The awards granted during 1993 will be determined by the
Company's
attainment of return on capital employed and sales growth
criteria during a
three-year performance period of 1993, 1994, and 1995. More
detail about
current performance goals is available in the Compensation
Committee Report
on page 9. However, there will be an additional three-year
involuntary
holding period thereafter during which the base amounts
determined during the
performance period will earn interest and remain subject to
forfeiture if the
participant discontinues employment for any reason other than
death,
disability, or retirement.
(3) The estimated future payouts do not include any interest
factor which
would be earned during the three-year involuntary holding period
following
the performance period. Interest during the involuntary holding
period would
accrue at a rate equal to 50% of the return on capital employed
of the
Company during the three years and would be payable, together
with the base
award, in 1999.
PENSION PLAN TABLE
The following table sets forth the estimated annual benefits
payable to the
Company's executive officers upon retirement in specified
remuneration and
years of service classifications.
<TABLE>
<CAPTION>
Annual Retirement Benefits
With Years of Service
Indicated (2)
Average
Annual Earnings
During the Highest
Four Consecutive
Years of Service 30 35 40 45
(1) years years years
years
<S> <C> <C> <C> <C>
$600,000 $267,447 $312,022 $346,522 $
381,022
800,000 357,447 417,022 463,022
509,022
1,000,000 447,447 522,022 579,522
637,022
1,200,000 537,447 627,022 696,022
765,022
1,400,000 627,447 732,022 812,522
893,022
1,600,000 717,447 837,022 929,022
1,021,022
</TABLE>
(1) Earnings include base salary, profit sharing cash, and the
value of
Profit Sharing Stock (at the time of award) actually earned by
the par-
ticipant and does not include any other forms of remuneration.
The ben-
efits are computed on the basis of straight-life annuity amounts,
and are
not subject to any deduction for social security or other offset
amounts.
(2) To provide for the retirement security of its employees, the
Company has
defined benefit pension plans for U.S. employees. These plans are
fully paid
by the Company, and employees become vested after five years of
service.
Under the plans, a participant may retire with an unreduced
pension at age
60, and if the participant's age and service total at least 90,
he or she
would receive a social security bridge to age 62.
The five individuals listed in the Summary Compensation Table are
presently
entitled to the respective years of service credit set opposite
their names:
<TABLE>
<S> <C>
L.D. DeSimone 37
J.E. Robertson (Retired March 1, 1994) 31
H.A. Hammerly 39
R.A. Mitsch 34
L.E. Eaton 34
</TABLE>
DIRECTORS' FEES
Directors who are not employed by the Company received in 1993 an
annual fee
of $35,000, of which $10,000 was determined by a committee,
comprised
entirely of employee directors, to be paid only in common stock
of the
Company, if, at the time of payment, the nonemployee director
owned less than
10,000 shares of the Company's common stock. Committee chairmen,
not employed
by the Company, receive an additional fee of $5,000 per year.
Nonemployee
directors are paid $1,500 for attendance at meetings of the Board
of
Directors and $1,000 for attendance at meetings of Committees of
the Board.
No directors' fees are paid to directors who are also employees
of the
Company. During the last full fiscal year, there were four
meetings of the
Board of Directors, and all nonemployee directors had four
scheduled meetings
of Committees of the Board.
All incumbent Directors and nominees for reelection attended 75
percent or
more of Board and Committee meetings. The average attendance was
in excess of
90 percent of all Board and Committee meetings.
Pursuant to the terms of the Company's 1992 Directors Stock
Ownership
Program, nonemployee directors may elect to defer payment of all
or a portion
of the foregoing fees payable in cash through a deferred cash or
common stock
equivalents account. This permits nonemployee directors to build
identity of
interest with stockholders generally through the deferred stock
which is
equivalent to the Company's common stock, except that shares of
deferred
stock may neither be voted or disposed. In addition, nonemployee
directors,
who serve more than one year as such, are paid retirement income
equal to the
annual retainer in effect at the time of their retirement for a
period equal
to their length of service on the Board as a nonemployee
director.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Committee are Messrs. Brennan, Chairman,
Jacobson, and
Shrontz, and Ambassador Ridgway.
Mr. Jacobson retired on November 1, 1991, as Chairman of the
Board and Chief
Executive Officer of the Company. The Securities and Exchange
Commission
requires that Mr. Jacobson's participation on the Committee be
characterized
as "insider participation" based upon his former employment with
3M. The
Board of Directors believes that Mr. Jacobson's participation in
the
deliberations of the Committee provides continuity and specific
knowledge
about individual performances and, further, that no conflicts of
interest
exist. Mr. Jacobson did not participate in any grant or award
decisions of
the Committee during the one-year period following his retirement
or with
regard to any matter that might affect him personally.
3M STOCK PERFORMANCE GRAPH
The graph below compares the Company's cumulative total
shareholder return,
overall stock market performance with reinvested dividends,
during the five
fiscal years preceding December 31, 1993, against the Standard &
Poor's 500
Stock Index and the Dow Jones Industrial Average, both of which
are
well-known and published industry indices. The Company is
included in both
the S&P 500 Stock Index and the Dow Jones Industrial group of 30
companies.
The Company, as a highly diversified manufacturer and seller of a
broad line
of products, is not easily categorized with other more specific
industry
indices.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
3M, S&P 500 INDEX AND DOW JONES INDUSTRIAL AVERAGE
<TABLE>
<CAPTION>
1988 1989 1990 1991 1992
1993
<S> <C> <C> <C> <C> <C> <C>
3M 100.00 133.07 148.44 165.23 186.26
207.60
DJIA 100.00 132.19 131.41 163.19 175.28
204.97
S&P500 100.00 131.60 127.51 166.19 178.83
196.78
</TABLE>
TRANSACTIONS WITH MANAGEMENT
During 1993, nine executive officers and directors had loans
outstanding with
the Eastern Heights State Bank of Saint Paul, a subsidiary of the
Company.
These loans were made in the ordinary course of business on
substantially the
same terms, including interest rates and collateral, as those
prevailing at
the time for comparable transactions with other persons of
comparable
circumstances and did not involve more than normal risk of
collectibility or
present other unfavorable features.
AUDIT, COMPENSATION, AND BOARD ORGANIZATION COMMITTEES
OF THE BOARD OF DIRECTORS
The Audit, Compensation, and Board Organization Committees are
standing
Committees of the Board.
AUDIT COMMITTEE
Members of the Audit Committee are Mr. Murray (Chairman), Mrs.
Peters, Mr.
Smith, and Dr. Sullivan. The Committee met four times during
1993. Its
primary functions are to recommend independent certified public
accountants;
review the scope of the audit examination, including fees and
staffing;
review the independence of the auditors; review and approve
nonaudit services
provided by the auditors; review findings and recommendations of
auditors and
management's response; review the internal audit and control
function; and
review compliance with the Company's ethical business practices
policy.
COMPENSATION COMMITTEE
Members of the Compensation Committee are Messrs. Brennan
(Chairman),
Jacobson, and Shrontz, and Ambassador Ridgway. The Committee met
four times
during 1993. Its primary functions are to review management
compensation
programs, approve compensation changes for senior executive
officers, review
compensation changes for senior management, and administer
management stock
option plans (acting without any person who may be a participant
under any
such plans).
BOARD ORGANIZATION COMMITTEE
Members of the Board Organization Committee are Messrs. DeSimone
(Chairman),
Jacobson, Murray, Ambassador Ridgway, and Mr. Smith. The
Committee met four
times during 1993. The Committee acts to select and recommend
candidates to
the Board of Directors to be submitted for election at the Annual
Meeting.
The Board of Directors has adopted criteria with respect to its
membership
and the Committee will consider candidates recommended by
stockholders or
others in light of these criteria. A stockholder may submit the
name of a
proposed nominee by writing to the Office of the Secretary,
Minnesota Mining
and Manufacturing Company, 3M Center, St. Paul, Minnesota 55144.
The
Committee also reviews and makes recommendations to the Board of
Directors
concerning the composition and size of the Board and its
committees,
frequency of meetings, directors' fees, and similar subjects;
reviews and
makes recommendations concerning retirement and tenure policy for
Board
membership; recommends proxies for meetings at which directors
are elected;
and audits programs for senior management succession.
SECTION 16 COMPLIANCE
The rules of the Securities and Exchange Commission require
disclosure of
late Section 16 filings by 3M directors and executive officers.
To the best
of the Company's knowledge and belief, there was a late filing in
June, 1993,
of an initial Form 3 on behalf of Louis W. Sullivan, who had been
elected a
new director at the 1993 Annual Meeting. The initial filing,
showing that Dr.
Sullivan then owned none of the Company's securities, was
inadvertently
overlooked by Company personnel and was not filed within the ten
days
permitted by the Commission's rules.
ITEM 2. INDEPENDENT PUBLIC ACCOUNTANTS
The Audit Committee recommended and the Board of Directors
appointed the firm
of Coopers & Lybrand, independent certified public accountants,
to audit the
books and accounts of the Company and its subsidiaries for the
year 1994. In
accordance with the Bylaws of the Company, this appointment is
being
presented to stockholders for ratification. If the stockholders
do not ratify
the selection of Coopers & Lybrand, the selection will be
reconsidered by the
Board of Directors.
Coopers & Lybrand has audited the Company's books since 1975. The
firm has
offices and affiliates in most localities throughout the world
where the
Company has operations. Audit services provided by the firm in
1993 included:
examination of financial statements of the Company and its
subsidiaries;
limited reviews of interim reports; review of filings with the
Securities and
Exchange Commission; consultations on matters related to
accounting and
financial reporting; assisting the Audit Committee in the review
of
compliance with the Company's ethical business practices policy;
preparation
of statutory audit reports for certain foreign subsidiaries; and
audit of the
financial statements of the Company's benefit plans.
Coopers & Lybrand also provided a number of nonaudit services
during 1993,
all of which were approved or reviewed by the Audit Committee.
The aggregate
fees for these nonaudit services constituted approximately 16
percent of the
fees for audit services performed by Coopers & Lybrand.
A representative of Coopers & Lybrand is expected to be present
at the
stockholders meeting and available to respond to appropriate
questions and
will be given an opportunity to make a statement, if the
representative
chooses to do so.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION
OF THE
APPOINTMENT OF COOPERS & LYBRAND, INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS,
TO AUDIT THE BOOKS AND ACCOUNTS FOR 1994. PROXIES SOLICITED BY
THE BOARD OF
DIRECTORS WILL BE VOTED FOR RATIFICATION UNLESS A CONTRARY VOTE
IS SPECIFIED.
ITEMS 3 AND 4. PROPOSED EXECUTIVE
PROFIT SHARING PLAN AND AMENDMENTS
TO PERFORMANCE UNIT PLAN.
By action of the Board of Directors taken February 14, 1994, two
compensation
matters are being submitted to stockholders for their approval --
the
Executive Profit Sharing Plan and amendments to the Performance
Unit Plan.
The Executive Profit Sharing Plan is designed to permit
qualification for
deduction under the Internal Revenue Code of 1986, as amended, of
short-term,
performance-based compensation that has been in effect for the
Company's
employees for decades.
ITEM 3. EXECUTIVE PROFIT SHARING PLAN.
The Executive Profit Sharing Plan brings before stockholders what
has been
the Company's basic performance-based cash compensation plan
since 1956. This
matter is being submitted for stockholder approval in order to
maximize
deductibility of compensation paid thereunder, pursuant to
Section 162(m) of
the Internal Revenue Code of 1986, as amended. This Plan
continues to provide
performance-based compensation to the Company's executive
officers that they
have been receiving for years under the Company's basic Profit
Sharing Plan,
which currently has approximately 4,300 employee participants.
Current payments under the existing profit sharing plan to the
five most
highly compensated employees of the Company are set forth in the
Summary
Compensation Table on page 11, under the columns captioned
"Profit Sharing
Cash (Bonus)" and "Profit Sharing Stock (Restricted Stock
Awards)." More
detail about the existing plan is provided in footnotes 2 and 3
on page 12.
Objective: The objective of the proposed plan is to provide a
mechanism
whereby the most highly compensated employees will have a
significant portion
of their total compensation measured by the quarterly net
earnings of the
Company, and thus be motivated by the opportunity of the
Company's overall
growth and success.
Participation and Eligibility: Such executive officers of the
Company as
determined by the Compensation Committee of the Board will be
eligible to
receive payments hereunder. It is anticipated that, with regard
to the first
year of operability in 1994, this would include the five
executive officers
named in the Summary Compensation Table, except Dr. Robertson who
has
announced his plans for early retirement.
Manner of Payment: Payment will be made on a quarterly basis in
cash, common
stock, or a combination of cash and stock as determined by the
Compensation
Committee of the Board. If payable in shares of the Company's
common stock,
the shares of Profit Sharing Stock will be issued and granted
under the
Company's 1992 Management Stock Ownership Program which was
approved by the
Company's stockholders in 1992, or a similar successor plan
approved by
stockholders.
Quarterly Earnings Per Share: The Compensation Committee, or a
subcommittee
comprised of at least two of its members, will determine the
manner and
method of determining the conversion of short-term performance by
the Company
into compensation to be paid to participants, with the
understanding that
such compensation shall be based upon the consolidated net income
of the
Company and its worldwide subsidiaries as recorded in the
quarterly and
annual statements filed with the Securities and Exchange
Commission. A
quarterly reserve of two and one-half percent (21/2%), or
approximately ten
percent (10%) on an annual basis, of the consolidated net worth
of the
Company and its consolidated subsidiaries, as of the close of the
immediately
preceding calendar quarter, is subtracted from the consolidated
net income,
and the difference is then divided by the number of outstanding
shares of the
Company's common stock, as of the close of the preceding calendar
and fiscal
quarter, to determine the Quarterly Profit Sharing Earnings Per
Share. This
fixed formula is the basic formula utilized since at least 1954
under the
Company's basic Profit Sharing Plan.
Date of Payment: Payment of cash amounts to participants will be
made within
60 days after the close of each calendar and fiscal quarter.
Shares of Profit
Sharing Stock may be restricted by action of the Compensation
Committee and
held for several years before payment.
Maximum Payments: The total paid under the Plan for the Company's
five most
highly compensated executive officers will never exceed one-half
percent
(0.5%) of the consolidated net income of the Company for any
respective
period, and no individual participant will ever receive more than
one-third
(331/3%) of this total Plan limit.
Taxes: All cash compensation received by participants under the
Plan will
constitute ordinary income in the year in which it is received.
Profit
Sharing Stock placed into the Company's custody as Restricted
Stock will not
result in the recognition of any income or gain until released
from custody
and delivered to the executive management participant. Dividends
paid on
Profit Sharing Stock during Company custody will, however, be
taxed as
ordinary income in the year received.
Administration: The Plan will be administered by the Compensation
Committee
appointed by the Board of Directors from its outside directors.
The present
Committee members are Messrs. Brennan (Chairman), Jacobson, and
Shrontz, and
Ambassador Ridgway, none of whom is eligible for participation.
The Committee
is empowered to adopt rules and regulations concerning the
administration and
interpretation of the Plan, but the Committee will have no
discretion with
regard to the basic criteria for determination of the Quarterly
Earnings Per
Share discussed above and may not, in any event, alter the units
or the
amount payable under the Quarterly Earnings Per Share formula
after the
commencement of a quarterly performance period.
Plan Amendment: The Board of Directors may at any time terminate
or amend the
Plan, except that no amendment shall be made without prior
approval of the
Company's stockholders which would (i) materially alter the
method for
determination of the Quarterly Profit Sharing Earnings Per Share,
or (ii)
materially alter the maximum limits for individual participants.
Plan Duration: The Plan is intended to be indefinite in duration,
but may be
amended or terminated at any time by the Board of Directors,
subject to the
above stated conditions. A short-term performance compensation
arrangement in
one form or another has existed in the Company's history since
1916.
Effect of Vote: A favorable vote by the holders of a majority of
the
Company's common stock present, or represented, and voting at the
Annual
Meeting, at which a quorum is present, is required to approve the
Plan. In
the event that the Plan does not receive a favorable majority
vote, the
result will be that the short-term performance compensation
presently paid to
these most highly compensated employees will not be deductible
for federal
income tax purposes by the Company, to the extent that it,
together with
other nonexempt compensation exceeds the amount provided by the
statute. At
that point, the Compensation Committee or the Board as a whole
may elect to
forego the deductibility or to restructure the compensation
packages of these
individuals to attempt to maximize deductibility of the
compensation paid to
these most highly compensated employees.
The Board of Directors recommends a vote "FOR" the proposal to
approve the
Executive Profit Sharing Plan. Proxies solicited by the Board of
Directors
will be voted FOR this proposal unless a contrary vote is
specified.
ITEM 4. 1994 AMENDMENTS TO
PERFORMANCE UNIT PLAN.
The Performance Unit Plan was submitted to and approved by the
Company's
stockholders in 1981.
Current payments under the Plan to the five most highly
compensated employees
of the Company are set forth in the Summary Compensation Table on
page 11,
under the column captioned "Performance Unit Plan (LTIP)
Payouts." Current
awards under the Plan to the five most highly compensated
employees are set
forth in the Long-Term Incentive Plan Awards Table on page 17,
and the Plan
is described in the footnotes to this Table on pages 17 and 18.
In order to maximize deductibility of the payments under the Plan
to the
Company's five most highly compensated employees under the
provisions of
Section 162(m) of the Internal Revenue Code, certain technical
amendments are
required to the Plan already approved by stockholders in 1981.
These
technical amendments deal with the following subject areas:
Administration: The Plan will be administered by the Compensation
Committee
of the Board of Directors, or through a subcommittee comprised of
at least
two of its members. The present Committee members are Messrs.
Brennan
(Chairman), Jacobson, and Shrontz, and Ambassador Ridgway, none
of whom is
eligible for participation. The Committee or subcommittee is
generally
empowered to adopt rules and regulations concerning the
administration and
interpretation of the Plan and to determine the conditions and
rights of
awards under the Plan. In its discretion, the Committee or
subcommittee will
determine the performance criteria upon which the award will be
based and the
specific targets upon which the face value of the performance
units will be
based. The criteria may be based upon the Company's return on
capital
employed, sales growth, or general performance comparisons with
other peer
companies. However, the Committee or subcommittee will have no
discretion to
alter or amend the performance criteria or the specific targets
of the awards
under the Plan after they have been communicated to participants
or after the
commencement of the respective performance period, whichever
shall occur
first.
Participation Limits: The maximum award to any one participant
under the Plan
shall not exceed the amount reasonably determined by the
Committee or
subcommittee to equal two-tenths of one percent (0.2%) of the
consolidated
net income of the Company for the immediately preceding calendar
year.
Effect of Vote: A favorable vote by the holders of a majority of
the
Company's common stock present, or represented, and voting at the
Annual
Meeting, at which a quorum is present is required to approve the
foregoing
amendments to the Plan. In the event that the amendments to the
Plan do not
receive a favorable majority vote, the Board of Directors would
then
determine whether to amend or abandon the Plan or to simply
forego the
deductibility of those limited individual compensation amounts in
excess of
$1 million, as provided by Section 162(m) of the Internal Revenue
Code of
1986, as amended.
The Board of Directors recommends a vote "FOR" the proposal to
approve the
foregoing amendments to the Performance Unit Plan. Proxies
solicited by the
Board of Directors will be voted FOR this proposal unless a
contrary vote is
specified.
OTHER MATTERS
The Management knows of no other matters which may properly be
presented at
the Annual Meeting, but if other matters do properly come before
the meeting,
it is intended that the persons named in the proxy will vote
according to
their best judgment.
Stockholders are encouraged to date, sign, and return the
enclosed proxy in
the enclosed envelope, to which no postage need be affixed if
mailed in the
United States. If you attend the Annual Meeting, you may revoke
your proxy at
that time and vote in person if you desire; otherwise, your proxy
will be
voted for you. If you plan to attend the meeting in person,
please mark the
appropriate box on the enclosed proxy card. An attendance card
will then be
mailed to you. This will be helpful in making proper arrangements
for the
meeting.
SUBMISSION OF STOCKHOLDER PROPOSALS FOR 1995 ANNUAL MEETING
Any proposal submitted for inclusion in the Company's proxy
statement and
form of proxy for the 1995 Annual Meeting of Stockholders must be
received at
the Company's principalexecutive offices in St. Paul, Minnesota,
on or before
November 30, 1994.
By Order of the Board of Directors.
ARLO D. LEVI
Vice President and Secretary
[logo]
NOTICE OF
1994 ANNUAL
MEETING OF
STOCKHOLDERS
AND PROXY
STATEMENT
MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
PROXY
3M VOLUNTARY INVESTMENT PLAN
AND 3M EMPLOYEE STOCK OWNERSHIP PLAN VOTING INSTRUCTIONS TO
TRUSTEE
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR USE AT THE
ANNUAL
MEETING ON TUESDAY, MAY 10, 1994.
I hereby direct State Street Bank and Trust Company, as Trustee
of the 3M
Employee Stock Ownership Plan Trust (the "ESOP Trust"), and as
Trustee of the
3M Voluntary Investment Plan Trust (the "VIP Trust"), to vote at
the Annual
Meeting of Stockholders of Minnesota Mining and Manufacturing
Company ("3M")
to be held on May 10, 1994 (or at any adjournment thereof) the
shares of 3M
common stock allocated to my respective accounts in these two
Plans as
specified on this instruction card.
I understand that this card must be received by the Norwest Bank
Minnesota,
N.A., acting as tabulation agent for the Trustee, by May 3, 1994.
If it is
not or if the voting instructions are invalid because not
properly signed and
dated, the shares held in my ESOP Trust Account will be voted by
State Street
Bank and Trust Company in the same proportion that the other
participants in
the ESOP direct the Trustee to vote shares held in their ESOP
Trust Accounts,
and the shares held in my VIP Trust Account will be voted by
State Street
Bank and Trust Company as directed by the Public Issues Committee
of the 3M
Board of Directors.
PLEASE COMPLETE, SIGN, DATE, AND PROMPTLY RETURN THIS CARD.
(continued, and to be signed, on the other side)
VIP SHARES (BEFORE SPLIT)
ESOP SHARES (BEFORE SPLIT)
IF NO VOTING INSTRUCTION IS GIVEN THE TRUSTEE, BUT YOU SIGN AND
RETURN THIS
CARD, THIS PROXY WILL BE VOTED FOR ITEMS 1, 2, 3 AND 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3
& 4.
ITEM 1. Election of directors
--Nominees to 1997 Class:
(A) Lawrence E. Eaton (B) Allen F. Jacobson (C) Aulana L. Peters
[ ] Vote FOR all nominees
[ ] Vote FOR ALL EXCEPT
(use letter before nominee's name to indicate exceptions):
[ ] Vote WITHHELD from all nominees
ITEM 2. Ratification of auditors [ ] For [ ] Against [ ]
Abstain
ITEM 3. Approval of Executive Profit Sharing Plan [ ] For [ ]
Against
[ ] Abstain
ITEM 4. Approval of Amendments to the Performance Unit Plan [ ]
For
[ ] Against
[ ] Abstain
ITEM 5. In their discretion, to vote upon other matters properly
coming
before the meeting
________________________
Signature
________________________
Signature
________________________
Date
I plan to attend the Annual Meeting. [ ]
Please sign exactly as your name(s) appear above. If held in
joint tenancy,
all persons must sign. Trustees, administrators, etc. should
include title
and authority. Corporations should provide full name of
corporation and title
of authorized officer signing the proxy.
TO PARTICIPANTS IN THE 3M VOLUNTARY INVESTMENT PLAN
AND THE 3M EMPLOYEE STOCK OWNERSHIP PLAN
State Street Bank and Trust Company is Trustee of the Trusts
established in
connection with the 3M Employee Stock Ownership Plan (the "ESOP")
and the 3M
Voluntary Investment Plan (the "VIP"). As Trustee, it is the
record owner of
the shares of common stock of Minnesota Mining and Manufacturing
Company
("3M") held in the ESOP and the Company Contribution Accounts of
the VIP for
the benefit of participants. Since the portion of the 3M
Payroll-Based
Employee Stock Ownership Plan ("PAYSOP") applicable to union-free
employees
was merged into the ESOP during 1990, the shares of 3M common
stock held in
the PAYSOP Trust have now been transferred to the ESOP Trust.
The ESOP and the VIP each permit participants to instruct the
respective
Trustees how to vote the number of shares of 3M common stock
allocated to the
participants' respective accounts. The number of shares of 3M
common stock
held in your individual accounts in the ESOP and the VIP are
indicated at the
top of the enclosed voting instruction card.
We enclose (1) a Notice of Annual Meeting of 3M Stockholders to
be held on
May 10, 1994, and Proxy Statement, (2) a card for giving voting
instructions,
and (3) a return envelope. If you complete the card and return it
in the
enclosed return envelope to Norwest Bank Minnesota, N.A., acting
as
tabulation agent for the Trustee, by May 3, 1994, the Trustee
will vote, in
accordance with your instructions, the shares of 3M common stock
allocated to
your respective accounts.
The Trustee remains at all times the record owner of the 3M
common stock held
in the ESOP and VIP accounts. The ability to instruct the Trustee
how to vote
confers no right on participants to vote directly at the Annual
Meeting of
Stockholders.
The enclosed instruction card must be properly completed if
voting
instructions are to be honored. If the card is not received by
May 3, 1994,
or if the voting instructions are invalid, the shares held in
your ESOP Trust
Account will be voted by State Street Bank and Trust Company in
the same
proportion that the other participants in the ESOP direct the
Trustee to vote
the shares held in their ESOP accounts, and the shares held in
your VIP
account shall be voted by State Street Bank and Trust Company as
directed by
the Public Issues Committee of the 3M Board of Directors.
Please complete, date, sign, and promptly return the enclosed
voting
instruction card.
[logo] MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR USE AT THE
ANNUAL
MEETING ON TUESDAY, MAY 10, 1994.
The shares of stock you hold in your account or in a dividend
reinvestment
account will be voted as you specify on the reverse side of this
card.
IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED "FOR" ITEMS 1,
2, 3 AND 4.
By signing the proxy, you revoke all prior proxies and appoint
L.D. DeSimone,
A.E. Murray, and A.F. Jacobson, and each of them, with full power
of
substitution, to vote your shares on the matters shown on the
reverse side
and any other matters which may come before the Annual Meeting
and all
adjournments.
(continued, and to be signed, on the other side)
SHARES
(BEFORE SPLIT)
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR ITEMS 1,
2, 3, AND 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3
AND 4.
ITEM 1. Election of directors
--Nominees to 1997 Class:
(A) Lawrence E. Eaton (B) Allen F. Jacobson (C) Aulana L. Peters
[ ] Vote FOR all nominees
[ ] Vote FOR ALL EXCEPT
(use letter before nominee's name to indicate exceptions):
[ ] Vote WITHHELD from all nominees
ITEM 2. Ratification of auditors
[ ] For [ ] Against [ ] Abstain
ITEM 3. Approval of Executive Profit Sharing Plan
[ ] For [ ] Against [ ] Abstain
ITEM 4. Approval of Amendments to the Performance Unit Plan
[ ] For [ ] Against [ ] Abstain
ITEM 5. In their discretion, to vote upon other matters properly
coming
before the meeting
____________________________
Signature
____________________________
Signature
____________________________
Date
I plan to attend the Annual Meeting. [ ]
Please sign exactly as your name(s) appear above. If held in
joint tenancy,
all persons must sign. Trustees, administrators, etc. should
include title
and authority. Corporations should provide full name of
corporation and title
of authorized officer signing the proxy.
MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
PROXY
3M SAVINGS PLAN VOTING INSTRUCTIONS TO TRUSTEE
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR USE AT THE
ANNUAL
MEETING ON TUESDAY, MAY 10, 1994.
I hereby direct State Street Bank and Trust Company, as Trustee
of the 3M
Savings Plan Trust (the "Savings Plan Trust"), to vote at the
Annual Meeting
of Stockholders of Minnesota Mining and Manufacturing Company
("3M") to be
held on May 10, 1994 (or at any adjournment thereof) the shares
of 3M common
stock allocated to my account in this Plan as specified on this
instruction
card.
I understand that this card must be received by the Norwest Bank
Minnesota,
N.A., acting as tabulation agent for the Trustee, by May 3, 1994.
If it is
not or if the voting instructions are invalid because not
properly signed and
dated, the shares held in my Savings Plan Trust Account will be
voted by
State Street Bank and Trust Company, as directed by the Public
Issues
Committee of the 3M Board of Directors.
PLEASE COMPLETE, SIGN, DATE, AND PROMPTLY RETURN THIS CARD.
(continued, and to be signed, on the other side)
SAVINGS PLAN SHARES (BEFORE SPLIT)
IF NO VOTING INSTRUCTION IS GIVEN THE TRUSTEE, BUT YOU SIGN AND
RETURN THIS
CARD, THIS PROXY WILL BE VOTED FOR ITEMS 1, 2, 3 AND 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3,
AND 4.
ITEM 1. Election of directors
--Nominees to 1997 Class:
(A) Lawrence E. Eaton (B) Allen F. Jacobson (C) Aulana L. Peters
[ ] Vote FOR all nominees
[ ] Vote FOR ALL EXCEPT
(use letter before nominee's name to indicate exceptions):
[ ] Vote WITHHELD from all nominees
ITEM 2. Ratification of auditors
[ ] For [ ] Against [ ] Abstain
ITEM 3. Approval of Executive Profit Sharing Plan
[ ] For [ ] Against [ ] Abstain
ITEM 4. Approval of Amendments to the Performance Unit Plan
[ ] For [ ] Against [ ] Abstain
ITEM 5. In their discretion, to vote upon other matters properly
coming
before the meeting
____________________________
Signature
____________________________
Signature
____________________________
Date
I plan to attend the Annual Meeting. [ ]
Please sign exactly as your name(s) appear above. If held in
joint tenancy,
all persons must sign. Trustees, administrators, etc. should
include title
and authority. Corporations should provide full name of
corporation and title
of authorized officer signing the proxy.
TO PARTICIPANTS IN THE 3M SAVINGS PLAN
State Street Bank and Trust Company is Trustee of the Trust
established in
connection with the 3M Savings Plan (the "Savings Plan"). As
Trustee, it is
the record owner of the shares of common stock of Minnesota
Mining and
Manufacturing Company ("3M") held in the Savings Plan for the
benefit of
participants. Since the portion of the 3M Payroll-Based Employee
Stock
Ownership Plan ("PAYSOP") applicable to employees eligible to
participate in
the Savings Plan was merged into the Savings Plan during 1993,
the shares of
3M common stock held in the PAYSOP Trust have now been
transferred to the
Savings Plan.
The Savings Plan permits participants to instruct the Trustee how
to vote the
number of shares of 3M common stock allocated to the
participants' respective
accounts. The number of shares of 3M common stock held in your
individual
account in the Savings Plan are indicated at the top of the
enclosed voting
instruction card.
We enclose (1) a Notice of Annual Meeting of 3M Stockholders to
be held on
May 10, 1994, and Proxy Statement, (2) a card for giving voting
instructions,
and (3) a return envelope. If you complete the card and return it
in the
enclosed return envelope to Norwest Bank Minnesota, N.A., acting
as
tabulation agent for the Trustee, by May 3, 1994, the Trustee
will vote, in
accordance with your instructions, the shares of 3M common stock
allocated to
your account.
The Trustee remains at all times the record owner of the 3M
common stock held
in the Savings Plan accounts. The ability to instruct the Trustee
how to vote
confers no right on participants to vote directly at the Annual
Meeting of
Stockholders.
The enclosed instruction card must be properly completed if
voting
instructions are to be honored. If the card is not received by
May 3, 1994,
or if the voting instructions are invalid, the shares held in
your Savings
Plan account shall be voted by State Street Bank and Trust
Company, as
directed by the Public Issues Committee of the 3M Board of
Directors.
Please complete, date, sign, and promptly return the enclosed
voting
instruction card.
MINNESOTA MINING AND MANUFACTURING COMPANY
3M CENTER, ST. PAUL, MINNESOTA 55144
PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR USE AT THE
ANNUAL
MEETING ON TUESDAY, MAY 10, 1994.
The shares of stock you hold in your account or in a dividend
reinvestment
account will be voted as you specify on the reverse side of this
card.
IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED "FOR" ITEMS 1,
2, 3,
AND 4.
By signing the proxy, you revoke all prior proxies and appoint
L.D. DeSimone,
A.E. Murray, and A.F. Jacobson, and each of them, with full power
of
substitution, to vote your shares on the matters shown on the
reverse side
and any other matters which may come before the Annual Meeting
and all
adjournments.
(continued, and to be signed, on the other side)
If no direction is given, this proxy will be voted FOR Items 1,
2, 3, and 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2, 3
& 4.
ITEM 1. Election of directors
--Nominees to 1997 Class:
(A) Lawrence E. Eaton (B) Allen F. Jacobson (C) Aulana L. Peters
[ ] Vote FOR all nominees
[ ] Vote FOR ALL EXCEPT
(use letter before nominee's name to indicate exceptions):
[ ] Vote WITHHELD from all nominees
ITEM 2. Ratification of auditors [ ] For [ ] Against [ ]
Abstain
ITEM 3. Approval of Executive Profit Sharing Plan [ ] For [ ]
Against
[ ] Abstain
ITEM 4. Approval of Amendments to the Performance Unit Plan [ ]
For
[ ] Against
[ ] Abstain
ITEM 5. In their discretion, to vote upon other matters properly
coming
before the meeting
Signed:____________________________ Date: __________
Signed:____________________________ Date: __________
Please sign exactly as your name(s) appear above. If held in
joint tenancy,
all persons must sign. Trustees, administrators, etc. should
include title
and authority. Corporations should provide full name of
corporation and title
of authorized officer signing the proxy.
