<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED
BY RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
ESKIMO PIE CORPORATION
- --------------------------------------------------------------------------------
(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] No fee required.
[_] 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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
<PAGE>
[ESKIMO PIE CORPORATION LOGO]
March 31, 2000
Dear Fellow Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders to
be held on Wednesday, May 3, 2000, at 10:00 a.m. in the Auditorium of the
Crestar Center, 919 East Main Street, Richmond, Virginia. A formal notice of
the meeting, together with a proxy statement and proxy form, is enclosed with
this letter. As you will see from the notice, you will be asked to elect six
directors to serve until the next Annual Meeting and to ratify the designation
of auditors for 2000. In addition to the formal agenda, we expect to report on
the Company's business activities and to answer any questions you might have.
We would appreciate your voting, signing, dating and promptly returning
the enclosed proxy in the postage-paid envelope that has been provided. By
doing so, you will be sure that your shares will be represented and voted at the
meeting. If you attend the meeting, you may revoke your proxy and vote in
person.
We look forward to seeing you if you are able to attend. Whether or not
you attend, we hope you will enjoy our products and recommend them to your
friends.
Sincerely,
/s/ Arnold H. Dreyfuss
Arnold H. Dreyfuss
Chairman of the Board
<PAGE>
ESKIMO PIE CORPORATION
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
-------------------
TO BE HELD WEDNESDAY, May 3, 2000
The Annual Meeting of Shareholders of Eskimo Pie Corporation (the
"Company") will be held on May 3, 2000, at 10:00 a.m. in the Auditorium of the
Crestar Center, 919 East Main Street, Richmond, Virginia, for the following
purposes:
1. To elect six directors to serve until the 2001 Annual Meeting of
Shareholders,
2. To ratify the selection of Ernst & Young LLP as independent auditors
for the current fiscal year, and
3. To transact such other business as may properly come before the meeting
or any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on March 17, 2000,
as the record date for determination of shareholders entitled to notice of and
to vote at the meeting and any adjournments or postponements thereof.
By Order of the Board of Directors,
/s/ Thomas M. Mishoe, Jr.
Thomas M. Mishoe, Jr.
Chief Financial Officer, Vice President,
Treasurer and Corporate Secretary
March 31, 2000
Please complete and return the enclosed proxy in the postage-paid envelope
that has been provided. If you attend the meeting in person, you may withdraw
your proxy and vote your own shares.
901 Moorefield Park Drive, Richmond, Virginia 23236
<PAGE>
ESKIMO PIE CORPORATION
901 Moorefield Park Drive
Richmond, Virginia 23236
____________________________
PROXY STATEMENT
____________________________
ANNUAL MEETING OF SHAREHOLDERS
May 3, 2000
General
- -------
The enclosed proxy is solicited by the Board of Directors of Eskimo Pie
Corporation (the "Company") for the Annual Meeting of Shareholders ("Annual
Meeting") of the Company to be held Wednesday, May 3, 2000, at the time and
place and for the purposes set forth in the accompanying Notice of Annual
Meeting of Shareholders or any adjournments or postponements thereof.
Shareholders may revoke proxies at any time prior to their exercise by written
notice to the Company, by submitting a proxy bearing a later date, or by
attending the Annual Meeting and requesting to vote in person.
The Company will pay all costs for this proxy solicitation. Proxies are
being solicited by mail and may also be solicited personally by telephone or
telegraph, by directors, officers and employees of the Company. The Company may
reimburse banks, brokerage firms, and other custodians, nominees and fiduciaries
for their reasonable expenses in sending proxy materials to the beneficial
owners of the Company's Common Stock.
The approximate mailing date of this Proxy Statement ("Proxy Statement")
and the accompanying proxy form is March 31, 2000.
Voting Rights and Revocability of Proxies
- -----------------------------------------
You are urged to sign and date the enclosed proxy card and return it in
the enclosed postage-paid envelope whether or not you attend the meeting. You
have the right to revoke your proxy at any time prior to the Annual Meeting by
submitting written notice to the Company, by submitting another proxy bearing a
later date, or by attending the Annual Meeting and requesting to vote in person.
A majority of the shares of Common Stock outstanding and entitled to vote,
represented in person or by proxy, will constitute a quorum for the vote at the
Annual Meeting.
Only those shareholders of record at the close of business on March 17,
2000, are entitled to notice of and to vote at the Annual Meeting or any
adjournments or postponements thereof. The number of shares of the Company's
Common Stock outstanding and entitled to vote as of the record date was
3,479,964. There are no other outstanding classes of voting securities of the
Company. Each holder of a share of Common Stock is entitled to one vote per
share on each matter presented at the Annual Meeting.
With regard to the election of directors, votes may be cast in favor or
withheld. If a quorum is present, the six nominees for director receiving the
highest number of affirmative votes shall be elected as directors. Votes
withheld from any director are counted for purposes of determining the presence
or absence of a quorum for the transaction of business, but have no other legal
effect on the election of directors under Virginia law.
<PAGE>
If a quorum is present, the affirmative vote of a majority of the votes
cast will be required under Virginia law to approve each other proposal,
including the ratification of auditors. Abstentions and broker non-votes (shares
held by brokers for customers which may not be voted on certain matters because
the broker has not received specific instructions from the customer) are counted
for purposes of determining the presence or absence of a quorum for the
transaction of business at the Annual Meeting, but are not counted as "cast" for
purposes of determining whether any of the proposals has been approved.
Therefore, an abstention or broker non-vote will have no legal effect with
respect to these proposals.
Security Ownership of Certain Beneficial Owners and Management
- --------------------------------------------------------------
The table below sets forth, as of February 2, 2000, the number and
percentage of shares of the Company's Common Stock held by persons known to the
Company to be the owners of more than five percent of the Company's issued and
outstanding Common Stock, each of the Company's directors and nominees for
director, the executive officers named in the Summary Compensation Table, and
all of the Company's directors and executive officers as a group. Except to the
extent that shares may be held in joint tenancy with a spouse or as otherwise
indicated, each director or executive officer has sole voting and investment
power with respect to the shares shown. The beneficial ownership shown for the
four shareholders other than directors and executive officers of the Company, is
based upon the most recent filings received by the Company for such shareholders
pursuant to Section 13(d) of the Securities Exchange Act of 1934.
<TABLE>
<CAPTION>
Amount and Nature of Percent of
Beneficial Ownership Common Stock
Name and Address of Beneficial Owner of Common Stock Outstanding
- ------------------------------------ --------------- -----------
<S> <C> <C>
Yogen Fruz World-Wide, Inc. (1) 587,700 15.7%
Toronto, Canada
Shamrock Farms Company (2) 514,566 13.7%
Phoenix, Arizona
Peak Management, Inc. (3) 230,100 6.1%
Boston, Massachusetts
Dimensional Fund Advisors Inc. (4) 213,800 5.7%
Santa Monica, California
Arnold H. Dreyfuss 26,582 (5)(6) *
Jupiter, Florida
Wilson H. Flohr, Jr. 12,309 (5)(8) *
Richmond, Virginia
Craig L. Hettrich 6,323 (6)(7) *
Richmond, Virginia
</TABLE>
2
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<TABLE>
<S> <C> <C>
F. Claiborne Johnston, Jr. 3,500 (5)(9) *
Richmond, Virginia
V. Stephen Kangisser 13,935 (6)(7) *
Richmond, Virginia
David B. Kewer 84,383 (6)(7) 2.3%
Richmond, Virginia
Daniel J. Ludeman 8,858 (5) *
Richmond, Virginia
Judith B. McBee 6,108 (5) *
Richmond, Virginia
Thomas M. Mishoe, Jr. 20,573 (6)(7) *
Richmond, Virginia
Robert C. Sledd 4,481 (5) *
Richmond, Virginia
William J. Weiskopf 8,390 (6)(7) *
Richmond, Virginia
All Directors and Executive Officers 216,603 (5)(6)(7) 5.8%
as a Group (12 persons)
</TABLE>
_____________________________
* Beneficial ownership does not exceed one percent of the outstanding shares of
Common Stock.
(1) The Schedule 13D, filed December 10, 1998, by Yogen Fruz World-Wide
Incorporated ("Yogen Fruz"), as amended by Amendment Nos. 1, 2 and 3, filed
December 17, 1998, July 1, 1999, and July 2, 1999, respectively, states that
Yogen Fruz acquired the shares of the Company's Common Stock reflected in
the filing with a view toward acquiring control of the Company for the
purpose of thereafter causing the Company to take such actions as Yogen Fruz
deems advisable, including a sale of all or part of the Company to a third
party, a change in the management of the Company and/or a restructuring of
the Company.
(2) The Schedule 13D, filed September 10, 1999, by Shamrock Farms Company
("Shamrock"), as amended by Amendment No. 1 filed October 26, 1999, states
that Shamrock has engaged in discussions with the Company regarding the
possibility of acquiring additional shares or possibly the entire Company.
The Schedule 13D filing, as amended, indicates that Shamrock continues to
hold the shares for investment purposes, but remains open to the
possibilities of purchasing additional shares for investment, disposing of
any shares it presently owns or undertaking to acquire control of the
Company.
(3) Prior to November 30, 1998, Peak Management, Inc., Peak Investment Limited
Partnership and Peter H. Kamin (collectively, "Peak") reported their
holdings of the Company's Common Stock on Schedule 13G, which is permitted
for institutional investors that certify passive investment intent with
respect to such holdings. Since November 30, 1998, the holdings of the
collective Peak entities have been reported on Schedule 13D, as amended by
Amendment Nos. 1 and 2, filed September 28, 1999, and January 27, 2000,
respectively, which reflects Peak's intention of engaging in discussions
with the Company or other third parties about a possible sale or
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<PAGE>
recapitalization of the Company or other change in control transaction in
which they may participate. These filings indicate that Mr. Kamin has
shared voting and dispositive power over all the shares of the Company's
Common Stock reported as beneficially owned by the Peak entities in the
preceding table.
(4) Dimensional Fund Advisors Inc. ("Dimensional") filed a Schedule 13G for the
year ended December 31, 1999, stating that it is a registered investment
advisor whose advisory clients own the shares indicated, but that
Dimensional possesses voting and/or investment power over the shares of the
Company's Common Stock. Dimensional disclaims beneficial ownership of such
securities.
(5) Includes shares under option that may be acquired on or before April 2,
2000, and shares of restricted and unrestricted stock, in each case granted
to non-employee directors as compensation for Board service under the 1996
Incentive Stock Plan, as more fully described under "Compensation of
Directors."
(6) Includes 6,000, 12,093, 66,666, 17,140 and 7,667 shares under option that
may be acquired by Messrs. Hettrich, Kangisser, Kewer, Mishoe, and
Weiskopf, respectively, on or before April 2, 2000, granted under the
Company's 1992 and 1996 Incentive Stock Plans, as more fully described in
the "Summary Compensation Table" and table of "Fiscal Year-End Option
Values."
(7) Includes shares held by executive officers in the Company's 401(k) Savings
Plan and Employee Stock Purchase Plan. Each participant in the respective
plans has the right to instruct the plans' trustee with respect to the
voting of shares allocated to his or her account.
(8) Includes 1,500 shares held by Mr. Flohr's wife; 2,000 shares held by Mr.
Flohr's wife as trustee; and 200 shares held as custodian.
(9) Includes 400 shares held by, or for the benefit of, a family member living
in Mr. Johnston's household, as to which shares Mr. Johnston disclaims
beneficial ownership.
Election of Directors
- ---------------------
Six directors are to be elected at the Annual Meeting. The six persons
named below, each of whom currently serves as a director of the Company, will be
nominated to serve as directors until the 2001 Annual Meeting or until their
successors have been duly elected and have qualified. The persons named in the
enclosed proxy will vote for the election of the nominees named below unless
authority is withheld. If, for any reason, any of the persons named below should
become unavailable to serve, an event which management does not anticipate,
proxies will be voted for the remaining nominees and such other person or
persons as the Board of Directors of the Company may designate.
Arnold H. Dreyfuss, who has served as a director of the Company since
1992, and who presently serves as Chairman of the Board, will not stand for
election and will be retiring from the Board immediately following the Annual
Meeting. Mr. Dreyfuss will turn 72 years of age in September 2000 and, in light
of the age limitation in the Company's Bylaws prohibiting service on the Board
past age 70 (or in the case of any person serving on the Board on January 1,
1996, who was then age 65 or older, past age 72), has determined not to stand
for election. Mr. Dreyfuss has been a devoted Board member and served a vital
role in the Company as Chief Executive Officer from September 1996 to March 1998
following the resignation of the Company's previous Chief Executive Officer.
The Board and the Company are grateful for his service. In view of the Board's
announced intention to pursue a sale of the Company, the Board has not
undertaken to seek a nominee to fill Mr. Dreyfuss's seat on the Board and
4
<PAGE>
has by resolution reduced the size of the Board to six persons effective as of
the close of the 2000 Annual Meeting of Shareholders.
Immediately following the Company's last annual meeting of shareholders
held September 8, 1999, the Board adopted a resolution stating its intent to
pursue a sale of the Company. The resolution, a copy of which was filed with the
Company's Form 10-Q for the quarter ended September 30, 1999, stated in part
that if the Company had not been successful in negotiating a sale of the Company
on or before its 2000 Annual Meeting, "the directors would provide any holder of
at least five percent of the outstanding shares the opportunity to nominate
directors for election at that annual meeting with the understanding that none
of the current directors would stand for re-election unless nominated by at
least one of such shareholders." The Board took this action as a result of
discussions with one shareholder, Peak Management, Inc. (see "Security Ownership
of Certain Beneficial Owners and Management"), who had voted in favor of the
Company's nominees in the contested election at the 1999 annual meeting. By
letter dated March 6, 2000, Shamrock Farms Company, the holder of approximately
14.9 percent of the Company's outstanding shares, nominated the six nominees
listed herein for election. During 1999 and early 2000, the Company was engaged
in discussions with Shamrock Farms Company relating to a possible acquisition of
the Company. As of the date of this Proxy Statement, those discussions had
terminated.
<TABLE>
<CAPTION>
Director Principal Occupation During Past Five Years;
Name (Age) Since Directorship in other Public Companies
- ---------- ----- -------------------------------------
<S> <C> <C>
Wilson H. Flohr, Jr. (53) 1992 Retired Executive Vice President and General Manager of Paramount's Kings Dominion, a
regional family theme park in Doswell, Virginia. Prior to his retirement in January,
1999, Mr. Flohr had served in this position for more than the prior 5 years.
F. Claiborne Johnston, Jr. (57) 1992 Attorney-at-Law, Partner in the law firm of Mays & Valentine, L.L.P., Richmond, Virginia,
since 1972.
David B. Kewer (45) 1997 Effective March 1998, President and Chief Executive Officer of the Company. Previously,
beginning March 1997, President and Chief Operating Officer of the Company. Formerly
(1993 until 1997), President of Willy Wonka Candy Factory, a subsidiary of Nestle USA,
Inc. From 1988 through 1993, various senior level positions at Drumstick Co. which was
acquired by Nestle in 1991.
Daniel J. Ludeman (43) 1997 Effective October 1, 1999, President and Chief Executive Officer of First Union
Securities, a division of First Union Securities, Inc., which is a wholly-owned brokerage
and investment banking subsidiary of First Union Corporation. Previously, since 1991,
Chairman and Chief Executive Officer of Mentor Investment Group, LLC (now Mentor
Investment Advisors), a Richmond, Virginia based asset management company.
Judith B. McBee (52) 1996 Senior Vice President, Marketing of Hamilton Beach/ Proctor-Silex, Inc., a small
appliance manufacturer
</TABLE>
5
<PAGE>
<TABLE>
<S> <C> <C>
headquartered in Richmond, Virginia, since January 1997; previously Executive Vice
President, Marketing (June 1994 to December 1996) and Executive Vice President,
Sales/Marketing (January 1990 to June 1994), Hamilton Beach/Proctor-Silex, Inc.
Robert C. Sledd (47) 1998 Chairman of the Board (since February 1995) and Chief Executive Officer (since 1987) of
Performance Food Group Company, a foodservice distributor headquartered in Richmond,
Virginia; director of SCP Pool Corporation.
</TABLE>
Board and Committee Meetings and Attendance
- -------------------------------------------
The Board of Directors held 43 meetings in person or by conference
telephone call during the fiscal year ended December 31, 1999. All directors
attended at least 88% of all meetings of the Board and committees on which they
served, except for Mr. Ludeman, who attended 58% of the meetings of the Board
and the committee on which he served.
The Board has standing Executive, Compensation and Audit Committees. The
Executive Committee has a wide range of powers, but its primary duty is to act,
if necessary, between scheduled Board meetings. For such purpose, the Executive
Committee possesses all the powers of the Board in management of the business
and affairs of the Company except as otherwise limited by Virginia law. The
Executive Committee did not meet or otherwise take action during the fiscal year
ended December 31, 1999. Members of the Executive Committee are Messrs. Dreyfuss
(Chairman), Flohr, Johnston and Kewer and Ms. McBee.
The Compensation Committee is responsible for setting and administering
the policies and programs that govern both annual compensation for the Company's
executive officers and employee stock ownership. During the fiscal year ended
December 31, 1999, the Compensation Committee met three times. Members of the
Compensation Committee are Messrs. Flohr (Chairman) and Sledd and Ms. McBee.
The Audit Committee recommends the appointment of a firm of independent
public accountants to audit the Company's financial statements, as well as
reviews and approves the scope, purpose and type of audit services to be
performed by the external auditors. The Audit Committee carries out its duties
pursuant to a written charter which was recommended by the Audit Committee and
adopted by the Board in 1996. The Audit Committee met two times during the
fiscal year ended December 31, 1999. Members of the Audit Committee are Messrs.
Ludeman (Chairman), Johnston and Sledd.
Compensation Committee Interlocks and Insider Participation
- -----------------------------------------------------------
Members of the Compensation Committee are Messrs. Flohr (Chairman) and
Sledd and Ms. McBee. No current member of the Compensation Committee is or has
been an employee of the Company or has any relationship to the Company that is
required to be disclosed pursuant to regulations of the Securities and Exchange
Commission. Furthermore, none of the Company's executive officers serves on the
board of directors of any company of which a Compensation Committee member is an
employee.
6
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Compensation of Directors
- -------------------------
Each director of the Company who is not also an executive officer of the
Company receives (a) an annual retainer of $7,000; (b) a $500 fee for attendance
at each Board Meeting; and (c) a $250 fee for attendance at each Committee
Meeting. The Chairman of the Board, who, beginning January 1, 1999, no longer
receives a salary for his duties, receives director's compensation at two times
that paid to other non-employee directors. Since 1998, in lieu of cash payments,
directors may elect to receive payment of the annual retainer and meeting fees
in Common Stock of the Company under the 1996 Incentive Stock Plan, as amended.
For 1999, all directors except Mr. Johnston, who is precluded from doing so by
his law firm's policies, elected to receive their compensation for Board and
committee service in the form of shares of Common Stock. Under the 1996
Incentive Stock Plan, outside directors also automatically receive a stock
option grant for 200 shares and a restricted stock grant for 200 shares of the
Company's Common Stock, each year, as part of their compensation for Board
service. Each outside director is also reimbursed for usual and ordinary
expenses of meeting attendance. A director who is also an executive officer of
the Company receives no additional compensation for serving as a director.
Certain Relationships
- ----------------------
Mays & Valentine, L.L.P., a law firm of which F. Claiborne Johnston, Jr.,
a current director and nominee for director of the Company, is a partner, was
retained to perform legal services for the Company and its subsidiaries during
the last fiscal year. It is anticipated that the firm will continue to provide
such services to the Company and its subsidiaries during the current fiscal
year. The amounts paid by the Company were based upon an agreed-upon fee
arrangement for services rendered, which the Company believes to be consistent
with fees charged for similar services by other comparable firms.
Daniel J. Ludeman, a current director and nominee for director of the
Company, is the President and Chief Executive Officer of First Union Securities,
a division of First Union Securities, Inc. ("FUSI"). FUSI is the Company's
financial advisor. FUSI is an affiliate of First Union National Bank, which
provides commercial banking services to the Company. It is anticipated that FUSI
and First Union National Bank will continue to provide such services to the
Company based on agreed-upon fee arrangements and interest rates which are
consistent with amounts charged for similar services by other comparable firms.
EXECUTIVE COMPENSATION
The table below lists all compensation paid or accrued by the Company for
each person who served as the Chief Executive Officer at any time during the
past fiscal year and the Company's four most highly paid executive officers,
other than the Chief Executive Officer, whose total annual salary and bonus for
the year ended December 31, 1999, exceeded $100,000. Messrs. Mishoe and
Kangisser first became executive officers of the Company in 1996. Mr. Kewer was
employed by the Company effective March 1, 1997, and became Chief Executive
Officer on March 1, 1998. Mr. Weiskopf became an executive officer in 1997. Mr.
Hettrich was employed by the Company in February 1998.
7
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SUMMARY COMPENSATION TABLE
--------------------------
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
--------------------------------------------- ------------------------------------------
Restricted Securities All Other
Name, Age and Other Annual Stock Underlying Compen-
Principal Position Year Salary Bonus Compensation (1) Awards Options(#) sation (2)
- ------------------ ---- ------ ----- ---------------- ------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
David B. Kewer (45) 1999 $384,500 (3) $ 264,250 (4)(5) ---- ---- 15,000 $3,400
President and Chief 1998 213,333 ---- $ 23,042 ---- 10,000 9,460
Executive Officer 1997 166,667 40,000 (6) 102,182 $125,000 (7) 50,000 525
Craig L. Hettrich (40) 1999 120,500 92,400 (4)(5) ---- ---- 6,000 3,025
General Manager, 1998 105,417 15,391 87,223 ---- 3,000 ----
Foodservice Division 1997 ---- ---- ---- ---- ---- ----
V. Stephen Kangisser (48) 1999 126,584 94,225 (4)(5) ---- ---- 6,000 3,663
Vice President, Sales 1998 119,792 5,000 ---- ---- 4,500 3,594
1997 112,002 ---- 52,558 ---- 7,639 2,023
Thomas M. Mishoe, Jr. (47) 1999 176,667 (3) 98,750 (4)(5) ---- ---- 6,000 2,628
Chief Financial Officer, 1998 134,833 ---- 16,217 ---- 4,500 2,680
Vice President, Secretary 1997 127,500 ---- ---- ---- 7,709 2,495
and Treasurer
William J. Weiskopf (39) 1999 101,667 68,000 (4)(5) ---- ---- 6,000 3,000
Vice President and 1998 96,667 3,000 ---- ---- 3,000 2,900
General Manager, 1997 85,877 --- 10,502 ---- --- 2,576
Flavors Division
</TABLE>
1) Of the total amounts reported as "Other Annual Compensation," the following
amounts are attributable to relocation expenses incurred in connection with
the respective officer's employment by the Company; Mr. Hettrich - $78,398
in 1998, Mr. Kangisser - $43,877 in 1997, Mr. Kewer - $10,242 in 1998 and
$92,182 in 1997, and Mr. Weiskopf - $9,145 in 1997. The remaining amounts
relate primarily to automobile allowances and club dues.
2) All amounts reflect the Company's matching contributions to the Company's
401(k) Savings Plan and Employee Stock Purchase Plan.
3) Amounts reported for Messrs. Kewer and Mishoe reflect a monthly increase to
their base salaries in light of the additional responsibilities they were
asked to assume in connection with the Board's decision in December 1998 to
explore strategic alternatives to enhance shareholder value. For Mr. Kewer,
the amount reported reflects an additional $12,000 per month for December
1998 through December 1999. For Mr. Mishoe, the amount reported includes an
additional $5,000 per month for December 1998 through June 1999. The
decision to continue Mr. Kewer's supplemental monthly base salary after
September 1999 was made, as explained below under "Certain Agreements," in
connection with the continuation of his additional responsibilities in the
Company's pursuit of strategic alternatives and in part in recognition of
the Company's reduction of approximately $250,000 in the amount potentially
payable to Mr. Kewer under his retention and severance agreement with the
Company in the event of a sale of the Company.
4) Amounts shown for each of Messrs. Kewer, Hettrich, Kangisser, Mishoe and
Weiskopf include awards under the 1999 Senior Management Incentive Plan in
the amount of $114,250, $36,150, $37,975, $42,500 and $30,500, respectively.
5) Amounts shown for each of Messrs. Kewer, Hettrich, Kangisser, Mishoe and
Weiskopf also include payments made in January 2000 in the amount of
$150,000, $56,250, $56,250, $56,250 and $37,500, respectively. As explained
under "Certain Agreements," these payments were made under revised retention
and severance agreements put in place in September 1999, in connection with
the restructuring of the Company's retention and severance benefits for the
Company's senior management and other employees. The revised contracts
provided for a 25% retention payment to be made in January 2000, provided
the named employee was still employed by the Company on December 31, 1999.
These contract revisions were made in an effort to assure the continued
employment of key employees
8
<PAGE>
following the Board's September 8, 1999, announcement of its decision to seek
a sale of the Company in order to maximize shareholder value.
6) Reflects amounts paid to Mr. Kewer as incentive to join the Company as
President and Chief Operating Officer.
7) Reflects an award of 10,000 restricted shares made to Mr. Kewer upon his
employment by the Company on March 1, 1997. All restrictions on these shares
expired as of March 1, 2000. As of December 31, 1999, Mr. Kewer's aggregate
restricted stock holdings were 5,000 shares with a value of $36,875.
The table below sets forth information regarding option grants made during
the year ended December 31, 1999, for each of the named executive officers.
OPTIONS GRANTED IN LAST FISCAL YEAR
-----------------------------------
<TABLE>
Number of Percentage of
Securities Total Options Exercise Grant Date Potential Realizable Value at Assumed
Underlying Granted to Price Market Annual Rates of Stock Appreciation
Options Employees in Per Price Expiration During Option Term (2)
----------------------
Granted 1999 Share Per Share Date 5% 10%
---------- ---- -------- --------- ---------- -- ---
<S> <C> <C> <C> <C> <C> <C> <C>
David B. Kewer 15,000 (1) 20% $13.25 $13.25 1/7/09 $125,000 $316,800
Craig L. Hettrich 6,000 (1) 8% 13.25 13.25 1/7/09 50,000 126,700
V. Stephen Kangisser 6,000 (1) 8% 13.25 13.25 1/7/09 50,000 126,700
Thomas M. Mishoe, Jr. 6,000 (1) 8% 13.25 13.25 1/7/09 50,000 126,700
William J. Weiskopf 6,000 (1) 8% 13.25 13.25 1/7/09 50,000 126,700
</TABLE>
(1) Grants were made under the Company's 1996 Incentive Stock Plan and become
exercisable in increments of one third each of the shares subject to option
on the January 7, 1999, grant date, and the first and second anniversaries
of the grant date, respectively.
(2) The dollar amounts under the 5% and 10% columns are the result of
calculations at assumed rates of stock price appreciation set by the
Securities and Exchange Commission. The dollar amounts shown are not
intended to forecast possible future price appreciation, if any, for the
Company's Common Stock.
The table below sets forth information regarding year-end option values
at December 31, 1999, for each of the named executive officers.
FISCAL YEAR-END OPTION VALUES (1)
---------------------------------
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Options at Year-End Options at Year-End (2)
------------------- -----------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
David B. Kewer 38,334 36,766 0 0
Craig L. Hettrich 3,000 6,000 0 0
V. Stephen Kangisser 6,047 12,092 0 0
Thomas M. Mishoe, Jr. 11,070 17,279 0 0
William J. Weiskopf 3,834 7,666 0 0
</TABLE>
9
<PAGE>
(1) The columns "Number of Shares Acquired on Exercise" and "Value Realized"
have been omitted because no options were exercised by the named executive
officers during the year ended December 31, 1999.
(2) None of the options held by the named executive officers were in-the-money
at year-end, based on a market value of the Company's Common Stock on
December 31, 1999 of $7.375.
Retirement Benefits
- -------------------
The table below sets forth information related to the annual benefits
payable upon retirement under the Company's defined benefit pension plans to
persons with the specified final average earnings and years of service as a
salaried employee of the Company, assuming a continuation of service and 1999
compensation to age 65, retirement at age 65, and an annual accrual rate of 1.5%
of average annual earnings, and without regard to the compensation limitations
under Internal Revenue Code (IRC) 401(a)(17) or the benefit limitation of IRC
415. The benefits set forth in the following table are not subject to any
deduction for social security or other offset amount.
PENSION PLAN TABLE
------------------
<TABLE>
<CAPTION>
Years of Service
------------------------------------------------
Average Amount of Annual Retirement Benefit
------------------------------------------------
Annual Earnings 15 20 25 30 35
--------------- -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$125,000 $ 28,125 $ 37,500 $ 46,875 $ 56,250 $ 65,625
$150,000 33,750 45,000 56,250 67,500 78,750
$175,000 39,375 52,500 65,625 78,750 91,875
$200,000 45,000 60,000 75,000 90,000 105,000
$225,000 50,625 67,500 84,375 101,250 118,125
$250,000 56,250 75,000 93,750 112,500 131,250
$300,000 67,500 90,000 112,500 135,000 157,500
$400,000 90,000 120,000 150,000 180,000 210,000
$450,000 101,250 135,000 168,750 202,500 236,250
$500,000 112,500 150,000 187,500 225,000 262,500
</TABLE>
"Average Annual Earnings" is an employee's highest five consecutive year average
total cash compensation within the last 10 years (which is salary, incentive
awards and other compensation payable in cash (exclusive of expense
reimbursements and allowances and similar items) as such amounts are shown under
the respective salary, bonus and other compensation columns in the Summary
Compensation Table).
The Company established two substantially identical pension plans in 1992,
covering salaried employees age 21 or over with one year of service. Salaried
employees who are not officers are covered by the tax-qualified plan and
officers are covered by the non-qualified plan.
Credited years of service for the named executive officers as of December
31, 1999 are David B. Kewer - 2.8; Craig L. Hettrich - 1.9; V. Stephen Kangisser
- - 3.6; Thomas M. Mishoe, Jr. - 3.8 and William J. Weiskopf - 5.7.
10
<PAGE>
Certain Agreements
- ------------------
The Company entered into substantially similar severance agreements with
each of Messrs. Hettrich, Kangisser, Kewer, Mishoe and Weiskopf upon their being
named executive officers of the Company. The agreements provided that
termination compensation would be paid if the executive's employment were
terminated by the Company within three years after a change in control other
than for cause (as defined in the agreements) or upon the death, permanent
disability, or retirement of the executive if the executive voluntarily
terminated his employment for "good reason" (as defined in the agreements).
"Change in control" was defined generally to include (i) an acquisition of 20%
of the Company's voting stock, (ii) a change in the composition of the Company's
Board of Directors whereby the individuals serving as directors at the date on
which these agreements became effective, or individuals becoming directors
subsequent to the date these agreements became effective whose election or
nomination was approved by a majority of the directors then in office, cease to
constitute at least a majority of the Board; (iii) shareholder approval of
certain business combinations or asset sales in which the Company's historic
shareholders hold less than 60% of the resulting or purchasing company or (iv)
shareholder approval of the liquidation or dissolution of the Company. Under
the agreements, termination compensation consisted of a cash payment equal to
approximately three times the average annual compensation paid to the executive
for the three most recent taxable years of the Company ending prior to the
change in control. In addition, the agreements provided for the continuation of
certain medical, life and disability benefits. These agreements renewed
annually unless terminated by the Company by notice given 60 days prior to
expiration of the current term.
In connection with the Board of Directors' decision in September 1999 to
seek a sale of the Company, the Company undertook to restructure its overall
retention and severance program for both salaried and hourly employees. This
restructuring reflected the necessity of retaining key employees and maintaining
their focus on managing the ongoing business of the Company in order to preserve
and enhance the value of the Company through any possible future sale of the
Company. In this connection, the Company entered into new Executive Retention
Bonus and Severance Agreements with each of the named executive officers in
place of their previous severance agreements. The revised agreements provide
benefits in the form of retention payments payable, without regard to a
termination of employment, following certain specified events. The retention
payments were set at a fixed dollar amount, payable 25% in January 2000 to those
executive officers who were still employed by the Company at December 31, 1999.
This date was selected because at the time of the Company's announced intent in
September 1999 to seek a sale of the Company as promptly as reasonably
practical, the Board had a goal of negotiating a definitive agreement for such a
transaction by the end of 1999. Under the revised retention and severance
agreements, the balance of the retention payment is payable upon a sale of the
Company or, in the case of Mr. Kewer, 30 days after a sale of the Company unless
he has voluntarily left the employ of the Company prior to that date. The
definition of "sale of the Company" in the revised agreements includes (i) a
change in the ownership of the Company, in connection with a transaction
relating to the Board's intention to sell the Company or its assets, resulting
in any one individual, entity or group owning more than 50% of the Company's
Common Stock; (ii) in the case of employees of a subsidiary or division of the
Company, a sale of the stock or substantially all of the assets of the
subsidiary or division; or (iii) the elimination of certain job responsibilities
as a result of a sale of assets or of one or more divisions of the Company or
its subsidiaries. If a sale of the Company does not occur before January 1,
2001, these agreements terminate without the payment of the remaining 75%
benefit. The effect of the restructuring of the severance agreements was to
reduce the amount potentially payable under the agreements for Mr. Kewer from
approximately $850,000 to $600,000, and for all executive officers as a group
from approximately $2.62 million to approximately $1.55 million.
Compensation Committee Report on 1999 Executive Compensation
- ------------------------------------------------------------
11
<PAGE>
The Company's executive compensation and benefits program is administered
by the Compensation Committee, which is composed entirely of non-employee
directors. The goal of the program is to attract, motivate, reward and retain
the management talent required to achieve the Company's business objectives, at
compensation levels which are equitable and competitive with those of comparable
companies. This goal is furthered by the committee's policy of linking
compensation to individual and corporate performance and by encouraging
significant stock ownership by senior management in order to align the financial
interests of management with those of the shareholders.
Historically, the three main components of the Company's executive
compensation program have been base salary, incentive awards under the Senior
Management Incentive Plan as established annually by the Committee and equity
participation in the form of stock options, restricted stock grants and
eligibility to participate in the Company Stock Fund of the Company's 401(k)
Savings Plan and Employee Stock Purchase Plan. Each year, the committee reviews
the total compensation package of each executive officer to ensure it meets the
goals of the program. As a part of this review, the committee considers
corporate performance, compensation survey data, the advice of consultants and
the recommendations of management.
Base Salaries
Base salaries for executive officers are reviewed annually to determine
whether adjustments may be necessary. Factors considered by the committee in
determining base salaries for executive officers include personal performance
considering the respective executive's level of responsibility, the overall
performance and profitability of the Company during the preceding year and the
competitiveness of the executive's salary with the salaries of executives in
comparable positions at companies of comparable size and operational
characteristics. Each factor is weighed by the committee in a subjective
analysis of the appropriate level of compensation for that executive. For
purposes of assessing the competitiveness of salaries, the committee
periodically reviews compensation data from national surveys and selected groups
as provided by William M. Mercer, Incorporated, the Company's compensation
consultant. Historically, such compensation data indicated generally that salary
levels for the Company's executive officers, other than the chief executive
officer, approximated the market averages of executive positions of similar
scope and responsibility for comparable companies. Historically, the Mercer
reports generally have shown the Company's chief executive officer compensation
to be below the market average of positions of similar scope and responsibility
for comparable companies.
In March 1999, the Board of Directors increased Mr. Kewer's base salary
from $216,000 to $231,000 annually, effective March 1, 1999, a 6.9% increase.
The December 1998 study by William M. Mercer, which the committee used for
guidance, indicated that Mr. Kewer's salary, even after this increase, was still
at approximately 85% of the average of base compensation for similar positions
in other comparable companies. Indeed, this comparison ratio for the chief
executive officer position was the lowest comparison ratio for any Company
officer. As a result, the committee voted to supplement Mr. Kewer's base salary,
beginning in December 1998, by $12,000 per month: (i) to offset this continuing
below-market base salary for the chief executive officer, (ii) as compensation
for outstanding leadership and performance during a period of continuing
uncertainty as to the Company's future as a public company, and (iii) in
recognition of his assumption of additional responsibilities in connection with
the pursuit of strategic alternatives while continuing the effort to manage and
rebuild the Company's day-to-day business. For substantially similar reasons,
the committee also voted to supplement Mr. Mishoe's base salary by $5,000 per
month, effective December 1998 through June 1999. In September 1999 the
committee voted, in connection with Mr. Kewer's continued additional
responsibilities and in part in recognition of the Company's reduction of
benefits payable to him under
12
<PAGE>
his retention and severance agreement, to continue Mr. Kewer's supplemental
monthly base salary until the Company's pursuit of strategic alternatives was
concluded.
Senior Management Incentive Plan
The Company utilizes an annual Senior Management Incentive Plan under
which executives may receive cash and stock incentive awards based upon
corporate, divisional and individual performance. Target thresholds and
anticipated awards are established annually by the committee and ratified by the
full Board. The plan provides for cash payment of awards under the plan.
The Company exceeded its earnings objectives in 1999, exclusive of non-
recurring expenses associated with the previously announced examination of
strategic alternatives to enhance shareholder value, restructuring costs, and
proxy contest expenses. Based on this performance, the Board awarded Senior
Management the maximum incentive payment allowable under the 1999 Senior
Management Incentive Plan. The executive officers as a group, including those
listed in the Summary Compensation Table, received incentive payments totaling
$292,625 for 1999. Other than relatively nominal divisional incentive awards
paid to Messrs. Hettrich, Kangisser and Weiskopf in 1998, the 1999 incentive
awards were the first and only performance awards paid by the Company since
awards were paid for 1995.
Equity Participation
At the time the Company became a public company in April 1992, management
held abnormally low ownership interests in the Company because of the prior
controlling ownership by Reynolds Metals Company. From time to time since the
Company's initial public offering, this issue has been raised as a concern by
various shareholders. As a result, the committee and the Board have continued
to believe it is important to increase management's equity participation in the
Company as a part of the Company's overall compensation policies to provide
long-term financial rewards linked directly to the market performance of the
Company's stock. The committee believes that significant ownership of stock by
senior management is the best way to align the interests of management and the
shareholders, and the Company's stock incentive program is designed to further
this objective. Awards with respect to the Chief Executive Officer are made by
the committee and awards for all the other executive officers are made by the
committee in consultation with the Chief Executive Officer.
In January 1999, the committee granted non-qualified stock options on
95,500 shares of Common Stock to executive officers and other employees. These
awards were made at an exercise price of $13.25 per share (which equaled the
closing price on the date of the grant) and become exercisable in increments of
one third each of the shares subject to option on the January 7, 1999, grant
date, and the first and second anniversaries of the grant date, respectively.
In addition to stock option and restricted stock grants, eligible
executive officers and many of the Company's employees participate in the
Company Stock Fund under the Company's 401(k) Savings Plan and/or Employee Stock
Purchase Plan, thereby increasing, on a voluntary basis, their equity
participation in the Company.
Section 162(m) Considerations
The committee has not given significant consideration to the deductibility
of executive compensation under Section 162(m) of the Internal Revenue Code,
which was enacted in 1993. Under this provision, beginning in 1994, a publicly
held corporation is not permitted to deduct compensation in excess
13
<PAGE>
of $1 million per year paid to the chief executive officer or any one of the
other named executive officers except to the extent the compensation was paid
under compensation plans meeting certain tax code requirements. The committee
has noted that the Company does not currently face the loss of this deduction
for compensation. The committee nevertheless has determined that in reviewing
the design of and administering the executive compensation program, the
committee will continue in the future to seek to preserve the Company's tax
deductions for executive compensation unless this goal conflicts with the
primary objectives of the Company's compensation program.
Compensation Committee
Wilson H. Flohr, Jr., Chairman
Judith B. McBee
Robert C. Sledd
Audit Committee Report for 1999
- -------------------------------
The audit committee oversees the Company's financial reporting process on behalf
of the Board of Directors. Management has the primary responsibility for the
financial statements and the reporting process including the system of internal
controls. In fulfilling its oversight responsibilities, the committee reviewed
the audited financial statements in the Annual Report with management, including
a discussion of the quality, not just the acceptability, of the accounting
principles, the reasonableness of significant judgments and the clarity of
disclosures in the financial statements.
The committee reviewed with the independent auditors, who are responsible for
expressing an opinion on the conformity of those audited financial statements
with generally accepted accounting principles, their judgments as to the
quality, not just the acceptability, of the Company's accounting principles and
such other matters as are required to be discussed with the committee under
generally accepted auditing standards. In addition, the committee has discussed
with the independent auditors the auditors' independence from management and the
Company including the matters in the written disclosures required by the
Independence Standards Board.
The committee discussed with the Company's independent auditors the overall
scope and plans for their audit. The committee meets with the independent
auditors, with and without management present, to discuss the results of their
examination, their evaluation of the Company's internal controls, and the
overall quality of the Company's financial reporting. The committee held two
meetings during fiscal 1999.
In reliance on the reviews and discussions referred to above, the committee
recommended to the Board of Directors (and the Board has approved) that the
audited financial statements be included in the Annual Report on Form 10-K for
the year ended December 31, 1999 for filing with the Securities and Exchange
Commission. The committee and the Board have also recommended, subject to
shareholder approval, the selection of the Company's independent auditors.
Audit Committee
Daniel J. Ludeman, Chairman
F. Claiborne Johnston, Jr.
14
<PAGE>
March 23, 2000 Robert C. Sledd
In compliance with the listing standards of the NASDAQ National Market
System, on which the Company's Common Stock trades, in the opinion of the Board,
no member of the Audit Committee has a relationship with the Company that would
interfere with the exercise of that member's independent judgement in carrying
out the responsibilities of a director. Mr. Johnston is a partner in a law firm
that provides certain legal services to the Company, as disclosed elsewhere in
this Proxy Statement. As is also disclosed elsewhere herein, Mr. Ludeman is
employed by First Union Securities, a division of First Union Securities, Inc.,
which is a wholly-owned brokerage and investment banking subsidiary of First
Union Corporation. The Company has had and expects to continue to have a
business relationship with various commercial and investment banking affiliates
of First Union Corporation. The Board was aware of these relationships when it
made its determination concerning the independence of these members of the Audit
Committee.
Performance Graph
- -----------------
The graph below shows the percentage change in the total return on the
Company's Common Stock during the five-year period ended December 31, 1999. The
Company's Common Stock price ranged from a low of $6.625 to a high of $22.00
between January 1, 1995, and December 31, 1999. The closing price for the stock
on December 31, 1999, was $7.375.
The Performance Graph assumes $100 was invested on January 1, 1995, in the
Company, the NASDAQ Stock Market Index, and an industry index for the ice cream
and frozen dessert business ("Industry Index") and shows the total return on
such investments, assuming reinvestment of dividends, as of December 31, 1999.
The Industry Index includes companies in SIC Code 2024 (ice cream and frozen
desserts). In addition to the Company, the Industry Index currently includes:
Ben & Jerry's Homemade, Inc., Dreyer's Grand Ice Cream, Yocream International,
Suiza Foods Corporation, TCBY Enterprises, Inc. and Tofutti Brands, Inc.
Comparison of Cumulative Total Return
Among Eskimo Pie Corporation Common Stock, an Industry Index
and the NASDAQ Market Index
<TABLE>
<CAPTION>
Cumulative Return as of
12/31/94 12/31/95 12/31/96 2/31/97 12/31/98 12/31/99
-------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Eskimo Pie Corporation 100.00 98.40 60.79 63.89 74.93 42.12
Ice Cream and Frozen
Desserts Industry 100.00 116.02 99.59 199.45 166.72 140.24
NASDAQ Market Index 100.00 129.71 161.18 197.16 278.08 490.46
</TABLE>
Ratification of the Selection of Independent Auditors
- -----------------------------------------------------
Ernst & Young LLP has been selected as independent auditors for the
Company for the fiscal year ending December 31, 2000, subject to ratification by
the shareholders.
15
<PAGE>
If not otherwise specified, proxies will be voted in favor of ratification
of the appointment. Representatives of Ernst & Young LLP are expected to be
present at the Annual Meeting, will have an opportunity to make a statement if
they so desire and are expected to be available to respond to appropriate
questions.
Section 16(a) Beneficial Ownership Reporting Compliance
- -------------------------------------------------------
Based on a review of reports of changes in beneficial ownership of the
Company's Common Stock and written representations furnished to the Company, the
Company believes that its officers and directors complied with all filing
requirements under Section 16(a) of the Securities Exchange Act of 1934 during
1999.
Shareholder Proposals for 2001 Annual Meeting
- ---------------------------------------------
The 2001 Annual Meeting of Shareholders is scheduled to be held on May 2,
2001. Under applicable law, the Board of Directors need not include an
otherwise appropriate shareholder proposal in its Proxy Statement or form of
proxy for that meeting unless the proposal is received by the Secretary of the
Company at the Company's principal place of business on or before December 1,
2000. In addition, the Company's Bylaws prescribe certain procedures which must
be followed, including certain advance notice requirements, in order for a
proposal to be properly brought before a shareholder meeting; such a shareholder
notice of intent to bring a proposal before an annual meeting of shareholders
must be delivered to the Company generally not later than 30 days prior to the
anniversary date of the notice sent by the Company in connection with the
previous year's annual meeting. Any shareholder desiring a copy of the Bylaws
will be furnished one without charge upon written request to the Secretary.
Other Matters
- -------------
As of the date of this Proxy Statement, management of the Company has no
knowledge of any matters to be presented for consideration at the Annual Meeting
other than those referred to above. If any other matter properly comes before
the Annual Meeting, the persons named in the enclosed proxy card intend to vote
such proxy, to the extent entitled, in accordance with their best judgment.
Annual Report on Form 10-K
- --------------------------
A copy of the Company's Annual Report for the year ended December 31, 1999,
is enclosed. You may obtain without charge a copy of the Company's 1999 Annual
Report on Form 10-K, as filed with the Securities and Exchange Commission,
exclusive of certain exhibits, by writing to the Corporate Secretary at 901
Moorefield Park Drive, Richmond, Virginia 23236. The 1999 Form 10-K may also be
accessed on the worldwide web at www.cfonews.com/epie/.
---------------------
By Order of the Board of Directors,
/s/ Thomas M. Mishoe, Jr.
Thomas M. Mishoe, Jr.
Chief Financial Officer, Vice President,
Treasurer and Corporate Secretary
16
<PAGE>
.FOLD AND DETACH HERE.
- --------------------------------------------------------------------------------
ESKIMO PIE CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints David B. Kewer, Thomas M. Mishoe, Jr. and
F. Claiborne Johnson, Jr. jointly and severally, proxies, with full power to
act alone, and with full power of substitution, to represent the undersigned and
to vote, as designated below and upon any and all other matters which may
properly be brought before such meeting, all shares of Common stock which the
undersigned would be entitled to vote at the Annual Meeting of Shareholders of
Eskimo Pie Corporation to be held on May 3, 2000, or any adjournment thereof.
1. Election of Directors to serve until 2001 Annual Meeting of Shareholders
[_] FOR all nominees listed [_] WITHHOLD AUTHORITY to vote
(except as written on the line below) for all nominees listed below
Nominees: Wilson H. Flohr, Jr., F. Claiborne Johnson, Jr., David B. Kewer,
Daniel J. Ludeman, Judith B. McBee and Robert C. Sledd
(INSTRUCTION: To withhold authority to vote for any individual nominee listed
above, write that nominee's name on the space provided below.)
________________________________________________________________________________
2. Ratification of the designation of Ernst & Young LLP as independent auditors
for the Corporation and its subsidiaries for the current fiscal year:
[_] FOR [_] AGAINST [_] ABSTAIN
<PAGE>
.FOLD AND DETACH HERE.
- --------------------------------------------------------------------------------
Unless otherwise specified in the squares provided, the undersigned's vote
will be cast for items 1 and 2. If, at or before the time of the meeting, any of
the nominees listed above has become unavailable for any reason, the proxies
have the descretion to vote for a substitute nominee or nominees. This proxy may
be revoked at any time prior to its exercise.
_____________________________________
Signature
_____________________________________
Signature
Dated:_________________________, 2000
(In signing as Attorney, Administrator,
Executor, Guardian or Trustee, please
add your title as such.)
