PAGE
<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to SS 240.14a-11(c) or SS 240.14a-12
Gibson Greetings, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
____________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
____________________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
____________________________________________________________________________
5) Total Fee Paid:
____________________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
____________________________________________________________________________
2) Form, Schedule or Registration Statement No.:
____________________________________________________________________________
3) Filing Party:
____________________________________________________________________________
4) Date Filed:
____________________________________________________________________________
PAGE
<PAGE>
GIBSON GREETINGS, INC.
2100 Section Road
Cincinnati, Ohio 45237
NOTICE OF ANNUAL MEETING
The Annual Meeting of Stockholders of Gibson Greetings, Inc. will be held
in the Tyler Davidson II Room at The Westin Hotel, Cincinnati, Ohio, at 12:00
p.m., Eastern Daylight time, on May 23, 1996 for the following purposes:
1. To elect three directors;
2. To approve the Gibson Greetings, Inc. 1996 Nonemployee Director Stock
Plan; and
3. To transact such other business as properly may come before the
meeting.
Stockholders of record at the close of business on April 15, 1996 are
entitled to receive notice of, and to vote at, the meeting.
______________________________________________________________________________
BY ORDER OF THE BOARD OF DIRECTORS, April 26, 1996
HAROLD L. CALDWELL
SECRETARY
______________________________________________________________________________
IMPORTANT:
TO VOTE YOUR SHARES, PLEASE MARK, SIGN AND DATE THE ENCLOSED
PROXY CARD AND MAIL IT PROMPTLY. THE ENCLOSED RETURN ENVELOPE
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES OR CANADA.
______________________________________________________________________________
PAGE
<PAGE>
GIBSON GREETINGS, INC.
2100 Section Road
Cincinnati, Ohio 45237
(513) 841-6600
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Gibson Greetings, Inc. of proxies to be voted at the
Annual Meeting of Stockholders on May 23, 1996. Except as otherwise
indicated, "the Company" as used herein refers to Gibson Greetings, Inc. and
its subsidiary corporations taken as a whole. This Proxy Statement and the
accompanying proxy card are being mailed to stockholders on or about April 26,
1996.
OUTSTANDING VOTING SECURITIES
The number of voting securities of the Company outstanding on April 15,
1996, the record date for the meeting, was 16,090,529 shares of common stock,
$.01 par value, all of one class and each entitled to one vote. The holders
of at least a majority of the outstanding shares of common stock must be
represented in person or by proxy at the Annual Meeting for the meeting to be
held.
PROXIES AND VOTING
Stockholders are urged to: read carefully the material in this Proxy
Statement; specify their choice on each matter by marking the appropriate
boxes on the enclosed proxy card; and sign, date and return the card in the
enclosed stamped envelope. A stockholder who executes a proxy may revoke or
revise that proxy in writing at any time before the meeting by notice to the
Company's Secretary or may, by voting by ballot at the meeting, cancel any
proxy previously returned.
The Company's Proxy Committee consists of three individuals, each of whom
is an officer of the Company. If a stockholder's proxy card is properly
executed and returned, but no choice is specified, the shares will be voted by
the Proxy Committee as recommended by the Company. At the present time it is
intended that proxies which contain no instructions to the contrary will be
voted "for" the nominees for director named in this Proxy Statement. Should
any nominee not be available for election, the proxies will be voted for the
election of such other person as may be recommended by the Company in place of
such nominee. Proxy cards, unless otherwise indicated by the stockholder,
also confer upon the Proxy Committee discretionary authority to vote all
shares of the stock represented by the proxies on any matter which properly
may be presented for action at the meeting. At the present time, the Company
is not aware of any business or matter which properly may be presented for
action at the meeting other than as is described in this Proxy Statement.
PAGE
<PAGE>
In accordance with the General Corporation Law of the State of Delaware
and the Company's By-Laws, the affirmative vote of a plurality of the shares
of the Company's common stock present in person or represented by proxy at the
meeting and entitled to vote on the election of directors will be sufficient
for election of the nominees as directors. Any other matter which might arise
at the meeting would be determined by a vote of a majority of the shares of
common stock present in person or represented by proxy and voting on that
matter. Abstentions and broker non-votes have the effect of negative votes as
to the election of directors but generally are deemed to be absent shares as
to other matters. Votes at the meeting will be tabulated by financial
officers of the Company, who act as Judges of Election. The Company has not
established a system for confidential voting.
ATTENDANCE AT ANNUAL MEETING
To ensure the availability of adequate space for stockholders wishing to
attend the meeting, attendance may be limited to stockholders of record or
their proxies, beneficial owners of the Company's stock having evidence of
such ownership, and invited guests of Management. Please indicate whether you
plan to attend the Annual Meeting by checking the appropriate box on the
enclosed proxy card.
THE BOARD OF DIRECTORS
Pursuant to the Delaware General Corporation Law, as implemented by the
Company's Restated Certificate of Incorporation and By-Laws, all corporate
powers are exercised, and the Company's business, property and affairs are
managed, by or under the direction of the Board of Directors.
Currently the Company has seven directors, divided into three classes,
with Class I containing three directors and Classes II and III each composed
of two directors. The nominees in Class I will be nominated for election as
directors to serve until the Annual Meeting in 1999 and until their successors
are elected and qualified. The directors in Class II will serve until the
Annual Meeting in 1997 and the directors in Class III have been elected to
serve until the Annual Meeting in 1998.
Set forth below is certain information with respect to each of the
nominees and continuing directors.
Class I
(Nominees for election to serve until 1999)
CHARLES D. LINDBERG, age 67. Mr. Lindberg has been a partner in the law
firm of Taft, Stettinius & Hollister, counsel to the Company, for more than
the past five years and currently serves as Managing Partner. He has been a
director of the Company since May 1991 and has been a member of the Audit
Committee since 1994.
PAGE
<PAGE>
ALBERT R. PEZZILLO, age 67. Mr. Pezzillo has been Chairman of the Board
and Chief Executive Officer of the Company since February 1996. He was a
business consultant from 1990 until 1996 after his retirement in 1990 from his
position as Senior Vice President of American Home Products Corporation, a
manufacturer and marketer of ethical pharmaceuticals, medical supplies and
hospital, consumer health care, food and household products. Prior to joining
American Home Products in 1981, he held a variety of executive positions with
Warner Lambert Company and Colgate Palmolive Company. Mr. Pezzillo became a
director of the Company in April 1990. He has been a member of the Audit
Committee since 1990.
C. ANTHONY WAINWRIGHT, age 62. Mr. Wainwright is currently Chairman of
Harris, Drury, Cohen, Inc., an advertising agency located in Ft. Lauderdale,
Florida. He was Chairman of Compton Partners, Saatchi & Saatchi (formerly
Campbell-Mithun-Esty), a national advertising agency from 1994 to 1995 and was
Vice Chairman of that company from 1989 to 1994. From 1980 until 1989 he was
President, Chief Operating Officer and a director of The Bloom Companies,
Inc., a holding company for a national advertising agency group. Prior to
1980, Mr. Wainwright held various executive positions with companies in the
advertising and marketing industries. He is also a director of All-Comm Media
Co., American Woodmark Corporation, Del Webb Corp. and Specialty Retail Group,
Inc. He has been a director of the Company since March 1988 and has been a
member of the Compensation Committee since 1993.
Class II
(Terms expiring in 1997)
GEORGE M. GIBSON, age 61. Mr. Gibson retired in 1992 from The Procter &
Gamble Company, having served as its Vice President - Treasurer from 1987 to
1992 and as Vice President - Comptroller from 1973 to 1987. He was associated
with Procter & Gamble, a manufacturer of consumer household products, for over
35 years. Mr. Gibson was elected a director of the Company on April 15, 1996
to fill a vacancy in the Class II directors.
FRANK STANTON, age 66. Until his retirement in 1990, Mr. Stanton had
served as Chairman and Chief Executive Officer of MRB Group, Inc., a
world-wide media and marketing research organization, which he founded in
1987. From 1974 until 1989 he was President and Chief Executive Officer of
Simmons Market Research Bureau, a leading rating service for the magazine
industry and now a subsidiary of MRB Group, Inc. He has been a director of
the Company since June 1985. He has been a member of the Audit and
Compensation Committees since 1986.
Class III
(Terms expiring in 1998)
BENJAMIN J. SOTTILE, age 58. Mr. Sottile served as the Company's
Chairman of the Board, Chief Executive Officer and President from 1989, 1987
and 1986, respectively, until February 1996. He became a director of the
Company in January 1987.
PAGE
<PAGE>
CHARLOTTE A. ST. MARTIN, age 50. Ms. St. Martin has been Executive
Vice President, Operations and Marketing, of Loews Hotels since 1989.
Previously she served Loews Hotels in a variety of other executive capacities.
Loews Hotels owns and operates fourteen hotels nationally and internationally.
Ms. St. Martin is also a former President of the Dallas Convention and
Visitors' Bureau. She has been a director of the Company since August 1993
and a member of the Compensation Committee since 1994.
Compensation of Directors. Since January 1, 1992, directors have been
entitled to receive fees of $900 for each Board meeting attended and $650 for
each committee meeting attended, plus reimbursement of expenses. In addition
to these fees, the Company pays an annual fee of $13,500 for services of
directors who are not employees of the Company and an annual fee of $2,500 per
chairmanship to each committee chairman. In April 1996, the annual fee to
nonemployee directors was increased to $18,000. Other fees remain unchanged.
It is proposed that nonemployee directors be required to take one-half their
annual retainer in shares of the Company's common stock. See "Approval of
1996 Nonemployee Director Stock Plan" below. Additionally, pursuant to the
Company's 1989 Stock Option Plan for Nonemployee Directors (the "Directors
Plan") each nonemployee director of the Company, at the close of business on
the day of the Annual Meeting of Stockholders, receives an option to purchase
1,000 shares of common stock.
Pending selection of a new chief executive officer, the Board of
Directors established an Office of the Chairman in February 1996. Since that
time, Mr. Pezzillo has served as Chairman and Chief Executive Officer of the
Company, and Messrs. Stanton and Wainwright have served as members of the
Office of the Chairman. Each is entitled to receive $900 per day devoted to
the business of the Company.
In order to continue to attract and retain outstanding individuals to
serve as nonemployee directors of the Company ("Outside Directors"), the
Company has a Retirement Plan for Outside Directors (the "Directors Retirement
Plan"). Outside Directors are defined by the Directors Retirement Plan as
directors not employed by the Company or a subsidiary and include former or
retired employees if they are not vested under any other Company retirement
plan. In order to qualify for benefits under the Directors Retirement Plan,
an Outside Director must have served the Company as such for at least nine
years. An Outside Director who does qualify for benefits under the Directors
Retirement Plan will receive an annual benefit, payable quarterly for life,
equal to the amount of the Company's annual fee (not including payments for
serving as chairman of a Board committee) paid to Outside Directors on the
date on which the Outside Director's service to the Company ceases (the
"Annual Retainer"). Benefits under the Directors Retirement Plan commence
upon termination of service for directors who have attained age 65 and are
payable beginning at age 65 to those whose services terminate prior to that
age. Should an Outside Director who has qualified for benefits under the Plan
die before receiving any benefits, the Outside Director's designated
beneficiary or estate will be entitled to receive a payment equal to five
times the Annual Retainer. Should an Outside Director die after the
commencement of benefits but prior to having received them for five years, the
beneficiary or estate will receive an amount equal to five times the Annual
Retainer less any benefits already paid.
PAGE
<PAGE>
Meetings; Committees of the Board. The Board of Directors held ten
meetings in 1995. The Board of Directors currently has an Audit Committee and
a Compensation Committee. The Audit Committee deals with financial reporting
and control of the Company's assets. This Committee, consisting of Frank
Stanton, Chairman, Charles D. Lindberg and Albert R. Pezzillo in 1995, held
five meetings during that year. The Compensation Committee, composed in 1995
of C. Anthony Wainwright, Chairman, Charlotte A. St. Martin and Frank
Stanton, sets cash compensation for the Company's executive officers and
certain other key employees, approves terms and conditions of employment
contracts for certain key executives and establishes terms and conditions of
the Company's bonus and retirement plans. The Committee also administers all
of the Company's Stock Option and Incentive Plans (except the Directors Plan,
which is administered by the full Board), selects the persons to whom awards
will be made under those Plans and, subject to the limitations imposed by the
Plans, establishes the terms and conditions of each award. The Compensation
Committee held five meetings in 1995. Each incumbent director attended at
least 75% of the aggregate of the total number of Board of Directors meetings
which he or she was eligible to attend and the total number of meetings of
committees of the Board on which the director served during the 1995 calendar
year.
APPROVAL OF 1996 NONEMPLOYEE
DIRECTOR STOCK PLAN
On April 17, 1996, the Board of Directors adopted, subject to stockholder
approval, the Gibson Greetings, Inc. 1996 Nonemployee Director Stock Plan (the
"Plan"). The full text of the Plan is set forth as Exhibit A to this Proxy
Statement, and the following summary is qualified in its entirety by reference
to the terms of the Plan.
The purpose of the Plan is to promote the Company's long-term growth by
increasing ownership of the Company's common stock by its nonemployee
directors. The Plan provides that, at the close of business on the date of
each annual meeting of stockholders, each nonemployee director will receive
shares of Gibson common stock having an aggregate fair market value equal to
50% of the annual retainer payable to nonemployee directors during the
following twelve month period. Cash annual retainer payments over the
following twelve months will be reduced accordingly. Therefore, each
nonemployee director will be required to take one-half of his or her annual
retainer in shares of the Company's common stock.
The Plan defines "annual retainer" as the annual cash retainer fee
payable to a nonemployee director for his or her services as a director, but
not including meeting fees and fees paid for chairmanships of committees of
the Board. The Company's annual retainer has been set at $13,500 since
January 1, 1992; in April 1996, it was increased to $18,000. The Company's
current nonemployee directors are Ms. St. Martin and Messrs. Gibson,
Lindberg, Pezzillo, Stanton, and Wainwright. Based upon the last sales price
of $13 5/8 for the common stock on the Nasdaq National Market on April 15,
1996, each nonemployee director would receive 660 shares of common stock in
lieu of $9,000 of their annual retainer. The Plan provides for the issuance
of up to 60,000 shares of common stock, as presently constituted.
PAGE
<PAGE>
The Company currently does not intend to register the shares of common
stock issuable pursuant to the Plan under the Securities Act of 1933.
Therefore, shares received will be restricted and will be subject to the
holding periods and other limitations on resale imposed by Rule 144 under that
Act.
If approved by stockholders at the Annual Meeting, the Plan will become
effective immediately. The Plan may be amended by the Board of Directors from
time to time, subject to certain stockholder approval and other requirements
of Rule 16b-3 under the Securities Exchange Act of 1934, and may be terminated
by action of the Board at any time. If not sooner terminated, it will expire
in ten years.
The value of shares of common stock received by nonemployee directors
pursuant to the Plan will constitute ordinary income to such persons and will
be compensation expense to the Company.
The Board of Directors intends to cause the following resolution to be
presented to stockholders for action at the Annual Meeting. The affirmative
vote of a majority of the shares of common stock present or represented by
proxy and entitled to vote will be required for approval, with abstentions
having the effect of votes against the proposal and broker non-votes deemed to
be absent shares.
RESOLVED, that the Gibson Greetings, Inc. 1996 Nonemployee Director
Stock Plan be, and it hereby is, approved and adopted.
The Board of Directors recommends a vote "FOR" approval and adoption.
EXECUTIVE COMPENSATION
AND OTHER INFORMATION
Summary Information. The following table sets forth, for each of the
three years in the period ending December 31, 1995, amounts of cash and
certain other compensation paid by the Company in respect of the year to (i)
Benjamin J. Sottile, the Company's Chief Executive Officer until February
1996, (ii) each of the two other executive officers of the Company who were
serving as executive officers at the end of 1995 and whose 1995 salary and
bonus exceeded $100,000, and (iii) Nelson J. Rohrbach, an executive officer of
the Company until November 1995. These persons are sometimes referred to
hereafter as the "named executive officers."
PAGE
<PAGE>
<TABLE>
<CAPTION>
Summary Compensation Table
Long Term
Compensation
Annual Compensation Awards
------------------------------ ------------------
Secur-
Other ities All
Annual Restricted Under- Other
Compen- Stock lying Compen-
Name and Principal Salary Bonus sation Award(s) Options sation
Position Year ($) ($) ($)(1) ($) (#) ($)(2)
- ----------------------- ---- -------- -------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Benjamin J. Sottile 1995 $472,250 $ 69,000 --- --- --- $ 53,025
Chief Executive Officer
1994 $462,900 --- --- --- 30,000 $ 53,025
1993 $427,400 $260,000 --- --- --- $ 53,669
William L. Flaherty 1995 $210,000 $160,000 $16,110 --- --- $ 22,115
Vice President
1994 $179,375 --- $24,353 --- 12,000 $ 52,781
1993 $ 20,641 $ 50,000 --- --- 15,000 $ 6,300
Stephen M. Sweeney 1995 $154,000 $ 80,000 --- --- --- $ 5,283
Vice President
1994 $154,000 --- --- --- 12,000 $ 5,283
1993 $142,875 $ 85,000 --- --- --- $ 5,378
Nelson J. Rohrbach (4) 1995 $209,091 --- $ 4,952 --- --- $259,427
Vice President
1994 $228,702 $103,125 $ 9,402 --- 45,000 $ 28,319
1993 $108,173 $ 30,000 --- --- --- $ 1,440
</TABLE>
PAGE
<PAGE>
[FN]
____________________________
(1) For 1995, perquisites did not exceed the lesser of $50,000 or 10% of
salary and bonus for any named executive officer.
(2) For 1995, includes the following: (i) matching contributions to the
Company's Matched PaySaver (401(k)) Plan on behalf of each of Messrs. Sottile
($1,125), Flaherty ($1,125), Sweeney ($1,125) and Rohrbach ($1,575) in respect
of their 1995 contributions to the Plan; (ii) group term life insurance
payments for Mr. Sottile ($5,400), Mr. Flaherty ($2,088), Mr. Sweeney ($4,158)
and Mr. Rohrbach ($5,119); (iii) whole-life insurance premiums of $46,500 for
the benefit of Mr. Sottile; (iv) reimbursement of temporary living and travel
expenses of $18,902 for Mr. Flaherty and $12,733 for Mr. Rohrbach; and (v)
termination costs of $240,000 for Mr. Rohrbach.
PAGE
<PAGE>
Stock Options. The Company has six existing plans pursuant to which
options for shares of common stock may be granted to key employees. These are
the 1982, 1983, 1985 and 1987 Stock Option Plans and the 1989 and 1991 Stock
Incentive Plans (together, the "Plans"). None of the Plans provides for the
grant of stock appreciation rights ("SARs"). No stock options were granted
under the Plans to the named executive officers during the year ended December
31, 1995.
With respect to each named executive officer, the following table sets
forth information concerning unexercised options held at December 31, 1995.
No named executive officer exercised options during 1995.
<TABLE>
<CAPTION>
Aggregated Option Exercises in Last Fiscal Year
and FY-End Option Values
Number of
Securities
Value Underlying Value of
Realized ($) Unexercised Unexercised
(Market Options In-the-Money
Price on at FY-End Options at
Shares Exercise (#) FY-End
Acquired Less ($)
on Exercise Exercise Exercisable/ Exercisable/
Name (#) Price) Unexercisable Unexercisable
- ------------------- ----------- ----------- -------------- -------------
<S> <C> <C> <C> <C>
Benjamin J. Sottile --- --- 230,000/20,000 $51,563/---
William L. Flaherty --- --- 14,000/13,000 ---/---
Stephen M. Sweeney --- --- 28,500/8,000 $4,125/---
Nelson J. Rohrbach(1) --- --- ---/--- ---/---
</TABLE>
[FN]
(1) All options terminated unexercised prior to fiscal year-end as a
result of Mr. Rohrbach's termination of employment with the Company.
Pension Plans. The Pension Plan Table set forth below shows estimated
annual pension benefits payable to a covered participant under the Company's
Retirement Income Plan (the "Retirement Plan"), a qualified defined benefit
pension plan, and under the Gibson Greetings, Inc. ERISA Makeup Plan (the
"Makeup Plan"), a nonqualified supplemental pension plan providing benefits
that would otherwise be denied participants because of certain Internal
Revenue Code limitations on qualified plan benefits. Benefits shown are
computed as a straight life annuity for an employee retiring at age 65 in 1996
with no offsets.
PAGE
<PAGE>
<TABLE>
<CAPTION>
Pension Plan Table
Years of Service
-------------------------------------------------------------------------------
Remuneration 5 10 15 20 25 30 35
- ------------ ------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 200,000 $14,190 $ 28,380 $ 42,570 $ 56,760 $ 70,950 $ 85,140 $ 99,330
300,000 21,690 43,380 65,070 86,760 108,450 130,140 151,830
400,000 29,190 58,380 87,570 116,760 145,950 175,140 204,330
500,000 36,690 73,380 110,070 146,760 183,450 220,140 256,830
600,000 44,190 88,380 132,570 176,760 220,950 265,140 309,330
700,000 51,690 103,380 155,070 206,760 258,450 310,140 361,830
800,000 59,190 118,380 177,570 236,760 295,950 355,140 414,330
900,000 66,690 133,380 200,070 266,760 333,450 400,140 466,830
1,000,000 74,190 148,380 222,570 296,760 370,950 445,140 519,330
</TABLE>
Benefits under the Retirement and Makeup Plans are based upon the highest
average sixty consecutive months' salary and bonus (as shown on the Summary
Compensation Table) during the 120 months immediately preceding retirement.
Compensation covered by the Plans at the end of 1995 for each named executive
officer is as follows: Mr. Sottile, $861,731; Mr. Flaherty, $269,013; and Mr.
Sweeney, $223,940. For the purpose of computing a benefit under the table
above, on December 31, 1995, Mr. Sottile had 9 years of credited service, Mr.
Flaherty, 2 years, and Mr. Sweeney, 8 years. Covered compensation amounts
differ from amounts shown on the Summary Compensation Table due to differences
in the recognition of pensionable earnings.
In addition to the Retirement Plan and the Makeup Plan, certain
executives designated by the Compensation Committee are eligible for benefits
under the Company's Supplemental Executive Retirement Plan (the "SERP"), which
was adopted to attract and retain highly qualified executives by providing
retirement benefits at levels which the Company believes to be competitive. A
participant in the SERP who retires at age 65 is entitled to receive
supplemental retirement benefits equal to the difference between (i) that
percentage of the participant's final monthly average earnings (as defined in
the Retirement Plan without regard to certain limitations imposed by the
Internal Revenue Code on qualified plans) determined by crediting 2%, 1-2/3%
and 1-1/3% per year, respectively, for each of the first 10, next 10 and next
10 years of credited service, up to a maximum of 30 years of credited service
(the "SERP percentage") and (ii) the aggregate of the participant's monthly
benefits from the Retirement Plan and the Makeup Plan plus supplemental
retirement benefits under any individual agreement with the Company. The SERP
provides for adjustments to the basic benefit formula in the event of a
participant's early retirement, disability retirement, death or other
termination of employment. At the normal retirement age each named executive
officer's years of credited service and SERP percentage would be as follows:
Mr. Sottile, 11 years and 22%; Mr. Flaherty, 19 years and 36%; and Mr.
Sweeney, 14 years and 26%.
At the time of his termination of employment with the Company, Mr.
Rohrbach had vested benefits aggregating $132,385 under the Company's
retirement plans.
PAGE
<PAGE>
Employment Contracts. Each of the named executive officers has or had an
employment agreement with the Company. The Company has an employment
agreement with Benjamin J. Sottile which was entered into as of April 1, 1993,
and which, by its terms, continues for a five-year period, subject to the
Company's right to terminate Mr. Sottile's employment prior to that time. The
Company has notified Mr. Sottile that his employment is terminated under that
agreement as of June 15, 1996. The agreement provides that Mr. Sottile is
entitled to receive his base salary (currently $460,000), incentive
compensation and fringe benefits in the amount and manner as if both parties
had fully performed their obligations under the agreement for the length of
the contract term, i.e. until March 31, 1998. It is the Company's position
that any incentive compensation is discretionary with the Compensation
Committee and that certain payments provided for in the agreement based upon a
change of control of 50 percent or more of the voting power of the Company's
securities will not be applicable after June 15, 1996. The Company intends to
pay Mr. Sottile's base salary and certain fringe benefits through March 31,
1998; to the extent that Mr. Sottile is ineligible, due to his termination of
employment, to participate in certain plans, the Company will provide suitable
substitute benefits. It is the Company's understanding that Mr. Sottile
disagrees with the Company's position on various of these items.
Mr. Flaherty's employment agreement currently expires on November 17,
1996 and continues indefinitely thereafter until terminated by the Company
upon one year's advance written notice or as otherwise provided therein. The
agreement provides for an annual salary of $175,000, subject to increase by
the Company from time to time, and participation in the Company's incentive
bonus plan. It also provides for severance pay equal to six months' salary in
the event of death and for a payment equal to three times annual salary then
in effect in the event of termination of employment under certain
circumstances after a change in control of the Company.
Mr. Sweeney's employment agreement provides for a base annual salary of
$136,000, subject to increase by the Company from time to time, and for
participation in the Company's incentive bonus plan. Generally, the agreement
is subject to termination by the Company upon one year's advance written
notice and as is otherwise provided therein. Mr. Sweeney's agreement also
provides that he is entitled to one year's salary (subject to offset under
certain circumstances) if he is not retained in substantially the same
capacity and salary for at least six months after any person becomes the
beneficial owner of 50% or more of the Company's securities and that, upon the
occurrence of a change in controlling ownership of the Company or a sale of
all or substantially all of the assets of the Company, the term of the
agreement is extended for two years and thereafter is subject to termination
upon six months' prior written notice.
Mr. Rohrbach, who was President and Chief Executive Officer of the
Company's former subsidiary Cleo, Inc., had an employment agreement with the
Company for a three-year term expiring May 31, 1997. The agreement provided
for an annual salary of $240,000, subject to review from time to time, and for
participation in the Company's incentive bonus plan. In connection with his
termination of employment with the Company, Mr. Rohrbach received one year's
annual salary paid upon the completion of the sale of Cleo.
The Company's employment agreements also generally provide additional
miscellaneous compensation in the form of some combination of perquisites such
as club membership fees, use of automobiles, insurance benefits and tax and
estate planning services.
PAGE
<PAGE>
Thomas M. Cooney, a director of the Company through June 1995, is
entitled, under the terms of his prior employment agreements with the Company,
to receive periodic payments, which began in 1991 and will continue through
2000, aggregating $1,005,000. As of April 15, 1996, $335,000 remained to be
paid pursuant to these agreements.
Certain Transactions. During 1995 the Company utilized the real estate
services of The Staubach Company (of which Roger T. Staubach, a director of
the Company until June 1995, is Chairman and Chief Executive Officer) for
various real estate sale and lease transactions. Fees in the amount of
$197,259 were earned during 1995 by The Staubach Company in connection with
these transactions.
Report of the Compensation Committee on Executive Compensation. The
Compensation Committee submits this report, which covers the objectives and
components of the Company's Executive Compensation Program, 1995 actions taken
by the Company and the Chief Executive Officer's compensation.
Objectives of the Executive Compensation Program
* To provide compensation opportunities that approximate those offered by
successful consumer products companies, so that the Company can attract and
retain the key executive talent needed to achieve its goals.
* To reward executives for achieving the financial goals of the Company
and its business units and for accomplishing their individual goals that
relate to improved management of internal operations and to the needs of the
Company's customers.
* To motivate executives to take a long-term view of the Company's
opportunities, so as to produce long-term value for shareholders.
Components of the Executive Compensation Program
The executive compensation program is comprised of four elements: base
salary, annual incentives, long-term incentives, and benefits.
Base Salaries. Generally, minimum base salaries for the Company's
executive officers are established in employment agreements with the Company.
Base salaries are targeted at the 50th percentile of those provided by other
consumer products companies with which the Company competes for key executive
talent. Levels of salary of various jobs are reviewed periodically to
determine their competitiveness. Executives' salaries are reviewed every 15
months, and are subject to adjustment based on the general movement in
salaries in the job market, as well as the individuals' job performance, their
relative contributions to the Company, and changes in their job
responsibilities and accountabilities. These reviews are subjective in the
sense that they are not based upon predetermined specific criteria. Because
the Company competes with a wide and diverse range of consumer products
companies for executive talent, the group of companies used for compensation
comparisons is not the same as that believed appropriate for a comparison of
shareholder returns in the Performance Graph shown below, although there may
be some overlap between the groups.
PAGE
<PAGE>
Annual Incentives. The Company places significant emphasis on achieving
its annual profit objectives. Accordingly, under the annual incentive plan,
specific targeted levels of before-tax income are established for each fiscal
year at both the corporate and division levels. A pool for incentive awards
is funded after year-end results are known, with the size of the pool
calculated based upon the achievement of predetermined percentages of the
target levels. Individual awards are made from this pool, with the size of
each award based on (1) the objective level of corporate/division
profitability and (2) a subjective assessment of the individual's
contributions to the business.
Eligibility for annual incentive awards is limited to key executives who
play important roles in the achievement of the Company's objectives. In
addition, other managers may receive incentive awards in a particular year, to
reward their extraordinary results or achievements for that year.
Achievement of target incentives (for meeting the Company's demanding
profit objectives) can place executives' annual cash compensation (that is,
base salary plus annual incentive award) somewhat above the median for
competitive practice.
Long-Term Incentives. The Company provides two different types of
long-term incentives to its senior executives: (1) stock options
(nonqualified and incentive stock options), which are typically awarded every
other year, and (2) restricted stock grants, awarded on a selective basis, and
only to the most senior executives.
Eligibility for long-term incentives is targeted to key corporate and
division executives and managers who can have a significant effect on the
achievement of the Company's long-term strategic objectives. The use of
Company stock as a key element of the executive compensation program is
intended to strengthen the link between the interests of senior management and
the Company's shareholders. Long-term incentives are granted based upon a
subjective assessment of the individual's performance and responsibilities.
Benefits. The Company's benefits program is comprised of retirement
income and group insurance plans. The objective of the program is to provide
executives with reasonable and competitive levels of protection against the
four contingencies (retirement, death, disability, and ill health) that can
interrupt their employment and/or income.
The Company's retirement income program consists of two tax-qualified
plans (a defined benefit pension plan and a matched savings plan) that cover
all salaried full-time employees, including the Company's executives, and two
non-tax-qualified plans for executives (an ERISA "Makeup" plan, that restores
defined benefit pension benefits denied by the federal tax laws, and a
supplemental defined benefit retirement plan).
The group insurance program consists of life, disability, and health
insurance benefit plans that cover all salaried full-time employees, including
the Company's executives. The employment agreements of individual executive
officers may also provide for perquisites in the form of supplemental
insurance benefits and/or Company payment of the premiums relating to
insurance benefits.
PAGE
<PAGE>
1995 Actions
In December 1994, in response to the decline in profitability for the
year, senior management undertook a broad-based cost reduction program. As
part of that program, the salaries of Benjamin J. Sottile, the Chairman of the
Board, President and Chief Executive Officer, all other named executive
officers and most employees of the Company were indefinitely frozen effective
December 31, 1994, although certain of the named executives received salary
increases during the course of 1994 based upon factors described earlier under
the description of "Base Salaries." Differences shown on the Summary
Compensation Table between 1994 and 1995 salaries reflect the effects of a
full year during 1995 at the increased base salary levels established in 1994.
Consistent with the Company's cost reduction program, none of the named
executive officers received a salary increase in 1995. After the end of the
year, and based upon the profitability of the Company's on-going operations,
annual incentive awards were granted to certain executive officers in March
1996 in respect of their 1995 performance. In addition, the wage freeze
implemented at the end of 1994 was lifted during early 1996 and the granting
of appropriate salary increases resumed.
In August 1995, due to uncertainties surrounding the Company's future
ownership, the Board of Directors passed a resolution entitling certain
officers and employees remaining in the Company's employment through April 1,
1996 to a bonus equal to 15% of salary. The resolution provided that any
annual incentive awards granted with respect to 1995 would be correspondingly
reduced by amounts received in accordance with the resolution.
The Company does not anticipate that the total annual taxable
compensation of any of its executive officers will exceed $1,000,000 in 1996
or the near term. Therefore, it expects that all taxable compensation for
these individuals will be tax-deductible to the Company. The Company intends
to preserve its tax deduction for executive officers and to take steps
necessary to do so if and as appropriate.
CEO Compensation
As previously noted, Mr. Sottile's salary was frozen as part of a
December 1994 cost reduction program and he received no base salary increase
in 1995.
Mr. Sottile's employment agreement provides for his eligibility to
participate in the Company's executive bonus plan. Mr. Sottile did not
receive an annual incentive award with respect to 1995. He received a bonus
of $69,000 in accordance with the August 1995 Board resolution described
above.
Compensation Committee C. Anthony Wainwright, Chairman
Charlotte A. St. Martin
Frank Stanton
PAGE
<PAGE>
Performance Graph. The following graph and table compare, over the
period shown, the cumulative total stockholder return of the Company's common
stock to the cumulative total return of companies included in the Standard &
Poor's 500 Stock Index and in a peer group index. (1) In each case it is
assumed that $100 was invested on December 31, 1990 and that all dividends
were reinvested.
[graph to be inserted]
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Gibson Greetings, Inc. 100.00 111.06 77.39 88.95 63.61 69.00
S&P 500 Index 100.00 130.47 140.41 154.56 156.66 215.45
Peer Group Index 100.00 123.80 132.08 137.20 117.02 122.00
</TABLE>
[FN]
(1) The peer group is composed of companies having seasonal businesses
which market consumer products through similar channels of distribution. The
returns of each company have been weighted according to their respective stock
market capitalization for purposes of arriving at a group average. The
members of the group are as follows: Action Industries, Inc., American
Greetings Corporation, A.T. Cross & Co., CSS Industries, Inc., Devon Group,
Inc., Fisher-Price, Inc., C.R. Gibson Co., Handleman Co., Jostens, Inc., Russ
Berrie & Co., Inc., Tyco Toys, Inc. and Western Publishing Group, Inc.
PAGE
<PAGE>
PRINCIPAL STOCKHOLDERS AND
HOLDINGS OF MANAGEMENT
The following table sets forth certain information with regard to the
beneficial ownership of the Company's common stock by (i) each of the
Company's stockholders known to hold more than 5% of the outstanding shares of
common stock, (ii) except as noted, each director and nominee and each
executive officer named on the Summary Compensation Table, individually, and
(iii) all directors and executive officers as a group. Information relating
to the Company's directors and executive officers is as of March 31, 1996.
Information on 5% stockholders is as reported by them to the Company
subsequent to December 31, 1995.
<TABLE>
<CAPTION>
Beneficial Ownership (1)(2)(3)
------------------------------
Number of
Name Position Shares Percent
- ------------------ ------------------------ --------- -------
<S> <S> <S> <S>
GSB Investment
Management, Inc.
301 Commerce Street,
Suite 1501
Ft. Worth, Texas 76102 1,176,317 7.3%
John Hancock Mutual
Life Insurance Company
and subsidiaries,
John Hancock Place
P.O.Box 111
Boston, Massachusetts 02177 1,414,804 8.8%
Heartland Advisors, Inc.
790 North Milwaukee Street
Milawaukee, Wisconsin 53202 1,560,000 9.7%
The Prudential
Insurance Company
of America
Prudential Plaza
Newark, New Jersey 07102 3,088,000 19.2%
Sanford C. Bernstein & Co., Inc.
One State Street Plaza
New York, New York 10004 952,863 5.9%
PAGE
<PAGE>
Albert R. Pezzillo Chairman of the Board and
Chief Executive Officer 7,700
George M. Gibson Director -
Charles D. Lindberg Director 4,600
Benjamin J. Sottile Director 255,000 1.8%
Charlotte A. St. Martin Director 2,000
Frank Stanton Director 12,300
C. Anthony Wainwright Director 7,100
William Flaherty Senior Vice President -
Finance 14,000
Stephen M. Sweeney Vice President -
Human Resources 33,500
All directors and executive
officers as a group
(9 persons) 336,200 2.1%
</TABLE>
[FN]
(1) Except as indicated, the percentage of shares held by each person is
less than 1%. Includes shares which may be purchased upon exercise of
presently exercisable options and options exercisable within 60 days after
March 31, 1996, in the following amounts: Mr. Sottile, 230,000 shares;
Messrs. Stanton and Wainwright, 7,000 shares each; Mr. Pezzillo, 6,000
shares; Mr. Lindberg, 4,000 shares; Ms. St. Martin, 2,000 shares; Mr.
Flaherty, 14,000 shares; Mr. Sweeney, 28,500 shares; and all directors and
executive officers as a group, 298,500 shares. No information is presented
for Mr. Rohrbach whose employment with the Company terminated prior to March
31, 1996.
(2) Includes the following numbers of shares as to which beneficial
ownership is disclaimed: 300 shares held by the wife of Mr. Stanton and 100
shares held by the wife of Mr. Wainwright.
PAGE
<PAGE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who beneficially own
more than ten percent of the Company's equity securities, to file reports of
security ownership and changes in such ownership with the Securities and
Exchange Commission (the "SEC"). These persons also are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file.
Based upon a review of such forms and written representations from its
executive officers and directors, the Company believes that all Section 16(a)
filing requirements were complied with on a timely basis during and for 1995.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's independent public accountants are selected by, and serve
subject to change by, the Board of Directors. The Board has voted to appoint
Deloitte & Touche LLP, Certified Public Accountants ("Deloitte & Touche"), as
independent public accountants of the Company for the year 1996.
Representatives of Deloitte & Touche are expected to be present at the
meeting, with the opportunity to make a statement if they desire.
Additionally, they will be available to respond to appropriate questions from
stockholders.
The firm of Deloitte & Touche was engaged as the Company's principal
independent public accountants on October 3, 1994. Previously, through
September 29, 1994, Arthur Andersen & Co. LLP ("Arthur Andersen") had served
the Company in this capacity since 1990. The decision to dismiss Arthur
Andersen and to engage Deloitte & Touche was made upon the recommendation of
the Audit Committee.
During the fiscal year 1994 interim period preceding September 29, 1994,
there were no disagreements between the Company and Arthur Andersen on any
matter of accounting principles or practices, financial statement disclosure,
or auditing scope of procedure ("disagreements"), which disagreements, if not
resolved to the satisfaction of Arthur Andersen, would have caused it to make
reference to the subject matter of such disagreements in connection with its
report.
PAGE
<PAGE>
During the same period of time, no event listed in (A) through (D) below
(a "reportable event") occurred; namely, (A) Arthur Andersen having advised
the Company that the internal controls necessary for the Company to develop
reliable financial statements did not exist; (B) Arthur Andersen having
advised the Company that information had come to Arthur Andersen's attention
that had led it to no longer be able to rely on management's representations
or that made it unwilling to be associated with the financial statements
prepared by management (C) both (1) Arthur Andersen having advised the Company
that the scope of Arthur Andersen's audit needed to be expanded significantly
or that information had come to Arthur Andersen's attention during such time
period that if further investigated might (i) have materially impacted the
fairness or reliability of either: a previously issued audit report or the
underlying financial statements; or the financial statements issued or to be
issued covering the fiscal period(s) subsequent to the date of the most recent
financial statements covered by an audit report (including information that
might have prevented it from rendering an unqualified audit report on those
financial statements) or (ii) caused Arthur Andersen to be unwilling to rely
on management's representations or be associated with the Company's financial
statements and (2) due to Arthur Andersen's dismissal, or for any other
reason, Arthur Andersen not have so expanded the scope of its audit or
conducted such further investigation; or (D) both (1) Arthur Andersen having
advised the Company that information had come to Arthur Andersen's attention
that it had concluded materially impacted the fairness or reliability of
either (i) a previously issued audit report or the underlying financial
statements or (ii) the financial statements issued or to be issued covering
the fiscal period(s) subsequent to the date of the most recent financial
statements covered by an audit report and (2) due to Arthur Andersen's
dismissal, or for any other reason, the issue not having been resolved to
Arthur Andersen's satisfaction prior to its dismissal. It should be noted
that, in its recommendations to management presented to the Audit Committee of
the Board of Directors of the Company on April 21, 1994, Arthur Andersen
indicated that the existence of the unauthorized transactions described in the
Company's Current Report on Form 8-K dated March 4, 1994 constituted a
"reportable condition" under the standards established by the American
Institute of Certified Public Accountants; however, the Company does not
believe that this reportable condition constitutes a "reportable event" as
described above. Also, the Company announced on July 1, 1994 that the value
of the inventory at its Cleo, Inc. subsidiary had been overstated for the
yearend 1993 by approximately $8.8 million. Upon initial discovery of a
possible problem related to Cleo's inventory, the Company promptly notified
Arthur Andersen of the same and Arthur Andersen participated in the
investigation that led to the July 1, 1994 announcement. As a result of the
inventory overstatement, the Company determined to restate it financial
statements for the period ended September 30, 1993, December 31, 1993 and
March 31, 1994, and such restatement resulted in the reissuance by Arthur
Andersen of its opinion regarding the Company's financial statements for the
year ended December 31, 1993, as restated.
The termination of Arthur Andersen did not result from any "disagreement"
(as defined above) but reflected the Company's dissatisfaction with the level
of performance of audit services by Arthur Andersen.
PAGE
<PAGE>
During the fiscal year 1994 interim period prior to September 29, 1994,
neither the Company nor anyone acting on its behalf consulted Deloitte &
Touche regarding (i) either: the application of accounting principles to a
specified transaction, either completed or proposed; or the type of audit
opinion that might be rendered on the Company's financial statements, where
either a written report was provided to the Company or oral advice was
provided that Deloitte & Touche concluded was an important factor considered
by the Company in reaching a decision as to the accounting, auditing or
financial reporting issue; or (ii) any matter that was either the subject of a
"disagreement" or a "reportable event" as noted in the preceding paragraphs.
PROXY STATEMENT PROPOSALS
Stockholder proposals will be considered for inclusion in the Proxy
Statement for the 1997 Annual Meeting if they are received by the Company
before the close of business on December 24, 1996.
PROXY SOLICITATION AND REVOCATION
The solicitation of the enclosed proxy is being made on behalf of the
Board of Directors, and the Company will bear the cost of solicitation. In
addition to solicitation by mail, officers and regular employees of the
Company may solicit proxies personally, by telephone or by telegraph. The
Company will reimburse brokers, banks or other persons for their reasonable
out-of-pocket expenses in sending proxy material to beneficial owners. To
assist in the solicitation of proxies, the Company has engaged Georgeson &
Company, Inc. for a fee estimated at $7,500, plus out of pocket expenses. Any
stockholder giving a proxy has the power to revoke it at any time prior to the
voting thereof.
PAGE
<PAGE>
Exhibit A
GIBSON GREETINGS, INC.
1996 NONEMPLOYEE DIRECTOR STOCK PLAN
ARTICLE 1 - Purpose of the Plan
Section 1.1 The purpose of this Gibson Greetings, Inc. 1996 Nonemployee
Director Stock Plan (the "Plan") is to promote the long-term growth of Gibson
Greetings, Inc. (the "Company") by providing a vehicle for Nonemployee
Directors to increase their proprietary interest in the Company and to attract
and retain highly qualified and capable Nonemployee Directors.
ARTICLE 2 - Definitions
Unless the context clearly indicates otherwise, the following terms shall
have the following meanings:
Section 2.1 "Annual Retainer" means the annual cash retainer fee
(specifically, not including meeting or chairmanship fees) payable by the
Company to a Nonemployee Director for services as a director of the Company,
as such amount may be changed from time to time.
Section 2.2 "Nonemployee Director" means a director of the Company who is
not an employee of the Company or a subsidiary thereof nor a former employee
receiving severance payments or eligible to receive Company retirement
benefits.
ARTICLE 3 - Administration of the Plan
Section 3.1 The Plan shall be administered by the Board of Directors
("Board"). The Board shall have full power and authority to: (i) interpret
and construe the Plan and adopt such rules and regulations as it shall deem
necessary and advisable to implement and administer the Plan, and (ii)
delegate administrative duties under the Plan to one or more agents as it
shall deem necessary or advisable.
Section 3.2 No member of the Board shall be personally liable for any
action or determination made in good faith with respect to the Plan or to any
settlement of any dispute between a Nonemployee Director and the Company. Any
decision or action taken by the Board with respect to the administration or
interpretation of the Plan shall be conclusive and binding upon all persons.
PAGE
<PAGE>
ARTICLE 4 - Issuances Under the Plan
Section 4.1 Each year, effective as of the close of business on the date
upon which the Company's annual meeting of stockholders for that year is held,
beginning with the 1996 annual meeting, each Nonemployee Director shall
receive shares of Common Stock ($0.01 per value) of the Company ("Shares") in
an amount equal to fifty percent (50%) of the Annual Retainer to be paid
Nonemployee Directors during the following twelve month period. The number of
Shares to be issued to each Nonemployee Director shall be determined by
dividing that amount which is fifty percent (50%) of such Annual Retainer by
the Fair Market Value of a Share on the date of the annual meeting. Cash
shall be paid in lieu of any fractional Share. Fair Market Value means the
last reported sales price of a Common Share on the Nasdaq National Market on
the day on which such value is to be determined or, if there are no reported
sales on such day, then the last reported sales price on the next preceding
day on which such a sale was transacted. The Fair Market Value of the Shares
issued to each Nonemployee Director shall be deducted from the Annual Retainer
otherwise payable to the Nonemployee Director during the following twelve
month period.
ARTICLE 5 - Participation
Section 5.1 All Nonemployee Directors of the Company shall participate in
the Plan.
ARTICLE 6 - Shares Subject to the Plan
Section 6.1 Subject to adjustment as provided in Article 8, the aggregate
number of Shares which may be issued pursuant to the Plan shall not exceed
60,000 Shares, and there are hereby reserved for issuance under the Plan
60,000 Shares.
ARTICLE 7 - Amendment and Termination
Section 7.1 The Board may suspend or terminate the Plan at any time. In
addition, the Board may, from time to time, amend the Plan in any manner but
may not, (i) without stockholder approval, adopt any amendment that would
require stockholder approval in order for the Plan or transactions thereunder
to qualify for the exemptions provided by Rule 16b-3 under the Securities
Exchange Act of 1934, as now or hereafter amended, or (ii) amend the
provisions of the Plan governing the amount, price or timing of awards more
frequently than once every six months, unless otherwise permitted under the
provisions of Rule 16b-3.
Section 7.2 Unless earlier terminated by the Board, the Plan shall expire
on the tenth anniversary of its effective date.
PAGE
<PAGE>
ARTICLE 8 - Adjustment Provisions
Section 8.1 If the Company shall at any time change the number of issued
Shares without new consideration to the Company (such as by stock dividend,
stock split, recapitalization, reorganization, exchange of shares, combination
or other change in corporate structure affecting the Shares) or make a
distribution of cash or property which has a substantial impact on the value
of issued Shares, the total number of Shares reserved for issuance under the
Plan shall be appropriately adjusted.
ARTICLE 9 - Effective Date
Section 9.1 The Plan shall be submitted to the stockholders of the
Company for approval and, if approved by the affirmative vote of the holders
of a majority of the Shares represented and entitled to vote at the 1996
annual meeting of stockholders shall become effective as of the date of such
approval. If stockholder approval is not obtained at the 1996 annual meeting
of stockholders, the Plan shall be null and void.
ARTICLE 10 - Miscellaneous
Section 10.1 Nothing contained in the Plan shall confer upon any
Nonemployee Director any special right to continue as a director of the
Company.
Section 10.2 The Plan shall be construed, governed and enforced in
accordance with the law of State of Delaware.
PAGE
<PAGE>
GIBSON GREETINGS, INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Harold L. Caldwell, William L. Flaherty
and Stephen M. Sweeney, and each of them, attorneys with the powers which the
undersigned would possess if personally present, including the power of
substitution, to vote all shares of the undersigned at the Annual Meeting of
Stockholders of Gibson Greetings,Inc. to be held in the Tyler Davidson II Room
at The Westin Hotel, Cincinnati, Ohio at 12:00 p.m., Eastern Daylight time, on
May 23, 1995, and at any adjournments thereof.
The proxy will be voted as specified. If no specification is made, the
proxy shall be voted FOR the nominees listed on the reverse side. As to any
other matter or if any of said nominees are not available for election, said
attorneys shall vote in accordance with their best judgment.
[CONTINUED AND TO BE SIGNED ON REVERSE SIDE]
PAGE
<PAGE>
Gibson Greetings, Inc.
P.O.Box 11084
New York, N.Y. 10203-0084
1. Election of Directors.
[ ] FOR all nominees listed below
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
[ ] *EXCEPTIONS
Nominees: Charles D. Lindberg, Albert R. Pezzillo and
C. Anthony Wainwright
(INSTRUCTIONS: To withhold authority to vote for any individual
nominee, mark the "Exceptions" box and write that nominee's name
in the space provided below.)
*EXCEPTIONS __________________________________________________
2. Approval of the Gibson Greetings, Inc. 1996 Nonemployee
Director Stock Plan.
[ ] FOR
[ ] AGAINST
[ ] ABSTAIN
3. Upon such other business as may properly come before the
meeting. (Strike through if you wish authority withheld.)
[ ] Mark here if you plan to attend the meeting.
[ ] Mark here for address change and note at left.
IMPORTANT: Please date and sign exactly as
name appears. If shares are held jointly,
each stockholder named should sign.
Executors, administrators, trustees, etc.
should so indicate when signing. If the
signer is a corporation, please sign full
corporate name by duly authorized officer.
Dated _________________, 1996
_____________________________
_____________________________
(Signature of Stockholder)
Votes must be indicated (x) in Black
or Blue ink.
Please Sign, Date and Return the Proxy Promptly Using the Enclosed Envelope.
