<PAGE> 1
SCHEDULE 14A
(RULE 14A)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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
</TABLE>
PPG INDUSTRIES, 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):
[ ] $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:
----------------------------------------------------
[ X ] No fee required
<PAGE> 2
PPG Logo
PPG Industries, Inc. One PPG Place Pittsburgh, Pennsylvania 15272
March 7, 2000
DEAR SHAREHOLDER:
You are cordially invited to attend the Annual Meeting of Shareholders of
PPG Industries, Inc. to be held on Thursday, April 20, 2000, in the Sheraton
Hotel, Station Square, Pittsburgh, Pennsylvania. The meeting will begin at 11:00
A.M. We look forward to greeting personally those shareholders who will be able
to be present.
This booklet includes the notice of the Annual Meeting and the Proxy
Statement, which contains information about the business of the Annual Meeting
and about your Board of Directors and its committees and certain executive
officers. This year you are being asked to elect three Directors.
It is important that your shares be represented at the Annual Meeting. You
are, therefore, urged to complete, date and sign the accompanying Proxy and
Voting Instruction Card and return it promptly in the return envelope provided
whether or not you plan to attend personally.
Sincerely yours,
/s/ Raymong W. LeBoeuf
Raymond W. LeBoeuf
Chairman of the Board
<PAGE> 3
PPG INDUSTRIES, INC.
One PPG Place, Pittsburgh, Pennsylvania 15272
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 20, 2000
Notice is hereby given that the Annual Meeting of Shareholders of PPG
Industries, Inc. will be held on Thursday, April 20, 2000, at 11:00 A.M.,
prevailing time, in the SHERATON HOTEL, STATION SQUARE, PITTSBURGH,
PENNSYLVANIA, for the purpose of considering and acting upon the election of
three Directors.
Only shareholders of record of the Company as of the close of business on
February 22, 2000 are entitled to notice of and to vote at the Meeting or any
adjournment thereof.
Admission to the Meeting will be by Admission Card only. If you are a
shareholder of record or a Savings Plan participant and plan to attend, you may
obtain an Admission Card by marking the box provided on the Proxy and Voting
Instruction Card. If your shares are not registered in your name, please advise
the shareholder of record (your bank, broker, etc.) that you wish to attend.
That firm will request an Admission Card for you or provide you with evidence of
your ownership that will gain you admission to the Meeting.
Michael C. Hanzel, Secretary
Pittsburgh, Pennsylvania
March 7, 2000
<PAGE> 4
PPG INDUSTRIES, INC.
One PPG Place, Pittsburgh, Pennsylvania 15272
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS--APRIL 20, 2000
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Voting Securities........................................... 2
Election of Directors....................................... 5
Committees of the Board................................ 7
Compensation of Directors.............................. 9
Other Transactions..................................... 10
Compensation of Executive Officers.......................... 11
Compensation Committee Report on Executive
Compensation.......................................... 11
Summary of Named Executives' Compensation.............. 16
Option Grants.......................................... 17
Option Exercises and Fiscal Year-End Values............ 20
Long-Term Incentive Plan Awards........................ 20
Retirement Plans....................................... 21
Change In Control Arrangements......................... 22
Shareholder Return Performance Graph................... 23
Auditors.................................................... 24
Miscellaneous............................................... 24
Vote Required.......................................... 24
Solicitation Costs..................................... 24
Shareholder Proposals.................................. 25
Section 16(a) Beneficial Ownership Reporting
Compliance............................................ 25
Other Matters.......................................... 25
</TABLE>
<PAGE> 5
PPG INDUSTRIES, INC.
One PPG Place, Pittsburgh, Pennsylvania 15272
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS--APRIL 20, 2000
This Proxy Statement is being mailed to the shareholders of PPG Industries,
Inc. (hereinafter sometimes called "PPG" or the "Company") on or about March 7,
2000, in connection with the solicitation of proxies by the Board of Directors
of the Company (hereinafter sometimes called the "Board of Directors" or the
"Board"). Such proxies, which may be given in the form of the accompanying Proxy
and Voting Instruction Card, will be voted at the Annual Meeting of Shareholders
of the Company (hereinafter sometimes called the "Meeting") to be held on
Thursday, April 20, 2000, at 11:00 A.M., prevailing time, in the SHERATON HOTEL,
STATION SQUARE, PITTSBURGH, PENNSYLVANIA and at any adjournment thereof. Proxies
may be revoked at will before they have been exercised, but the revocation of a
proxy will not be effective until written notice thereof has been given to the
Secretary of the Company.
------------------------
VOTING SECURITIES
As of the close of business on February 22, 2000, there were outstanding
174,172,343 shares of the Common Stock of the Company, par value $1.66 2/3 per
share, the only class of voting securities of the Company outstanding. Only
shareholders of record as of the close of business on February 22, 2000, are
entitled to notice of and to vote at the Meeting. Except with respect to the
election of Directors, each such shareholder is entitled to one vote for each
share so held. With respect to the election of Directors, the right of
cumulative voting exists. That right permits each shareholder to multiply the
number of shares the shareholder is entitled to vote by the number of Directors
to be elected in order to determine the number of votes the shareholder is
entitled to cast for nominees, and, then, to cast all or any number of such
votes for one nominee or to distribute them among any two or more nominees in
that class. The proxies solicit discretionary authority to vote cumulatively.
Set forth below is certain information with respect to the beneficial
ownership of shares of the Common Stock as of February 22, 2000 by certain
persons, including (i) the nominees for Directors, the continuing Directors, one
of whom is the Chief Executive Officer of the Company (hereinafter sometimes
called the "CEO"), and the four other most highly compensated Executive Officers
(as
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<PAGE> 6
defined under the Securities and Exchange Act of 1934) of the Company (in
addition to the CEO) and (ii) such persons and all other Executive Officers, as
a Group.
<TABLE>
<CAPTION>
Shares of Beneficially Owned Common Stock
and Common Stock Equivalents(1)
-------------------------------------------------
Name of Beneficially Owned Common Stock
Beneficial Owner Common Stock(2) Equivalents(3) Total(4)
---------------- --------------- -------------- --------
<S> <C> <C> <C>
Raymond W. LeBoeuf....................... 629,929 45,872 675,801
Erroll B. Davis, Jr. .................... 1,113 5,727 6,840
Michele J. Hooper........................ 1,600 2,567 4,167
Allen J. Krowe........................... 3,705 14,182 17,887
Steven C. Mason.......................... 2,000 11,081 13,081
Robert Mehrabian......................... 2,000 8,863 10,863
Thomas J. Usher.......................... 1,000 1,468 2,468
David G. Vice............................ 7,000 5,233 12,233
David R. Whitwam......................... 2,000 10,907 12,907
E. Kears Pollock......................... 311,600 12,256 323,856
Frank A. Archinaco....................... 248,295 21,233 269,528
Charles E. Bunch......................... 201,260 6,648 207,908
William H. Hernandez..................... 191,599 7,740 199,339
All of the above and all other Executive
Officers as a Group(5)................. 1,850,873 175,889 2,026,762
</TABLE>
- ------------
(1) Each of the named owners has sole voting power and sole investment power as
to all the shares beneficially owned by them with the exception of (i)
shares held by certain of them jointly with, or directly by, their spouses,
and (ii) the Common Stock Equivalents shown in the second column and
described more fully below which have no voting power.
(2) Shares of Common Stock considered to be "Beneficially Owned" include both
Common Stock actually owned and shares of Common Stock as to which there is
a right to acquire ownership on, or within sixty days after, February 22,
2000. None of the identified beneficial owners holds more than 1% of the
shares of Common Stock beneficially owned. The Group consisting of the
identified owners and all other Executive Officers, holds 1.01% of the
shares of Common Stock beneficially owned. Of the shares shown, 508,301,
248,808, 184,766, 153,149 and 170,852 of the shares of Messrs. LeBoeuf,
Pollock, Archinaco, Bunch and Hernandez, respectively, and 1,467,084 of the
shares held by all of the owners named above and all other Executive
Officers as a Group are shares as to which the beneficial owner has the
right to acquire ownership within
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<PAGE> 7
sixty days of February 22, 2000, upon the exercise of Options granted under
the PPG Industries, Inc. Stock Plan (sometimes also referred to in this
Proxy Statement as the "Stock Plan" or the "Plan").
(3) Certain Directors hold Common Stock Equivalents in their accounts in the
Directors' Common Stock Plan and in their accounts in the Deferred
Compensation Plan for Directors (which plans are described under
"Compensation of Directors" below). Certain Executive Officers hold Common
Stock Equivalents in their accounts in the Company's Deferred Compensation
Plan as a result of their deferral of salary under that plan or their
deferral of awards made to them under the Company's Incentive Compensation
and Deferred Income Plan for Key Employees (the "Incentive Compensation
Plan") and the 1984 Earnings Growth Plan, which deferrals are held under the
Company's Deferred Income Plan for Key Employees. Common Stock Equivalents
are hypothetical shares of Common Stock having a value on any given date
equal to the value of a share of Common Stock. Common Stock Equivalents earn
dividend equivalents until the Common Stock Equivalents are paid, but they
carry no voting rights or other rights afforded to a holder of the Common
Stock.
(4) This is the sum of the Beneficially Owned Common Stock and the Common Stock
Equivalents as shown in the previous two columns.
(5) The Group consists of fifteen persons: the seven Executive Officers of the
Company as of February 22, 2000 (Messrs. LeBoeuf, Pollock, Archinaco, Bunch
and Hernandez and Messrs. R. L. Crane and J. C. Diggs), the three nominees
for Directors, and the five continuing Directors other than the CEO.
Capital Research and Management Company ("CRMG"), 333 South Hope Street,
Los Angeles, California 90071, an investment adviser, reported to the Securities
and Exchange Commission ("SEC") that it beneficially owned 10,442,400 shares.
That amount was approximately 5.8% of the total beneficially owned Common Stock
of the Company as of December 31, 1999. This shareholder stated in its report
that it had sole dispositive power over all shares so owned but no voting power
over any of those shares.
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<PAGE> 8
ELECTION OF DIRECTORS
Three Directors are to be elected to a class which will serve until 2003
and until their successors have been elected and qualified, or their earlier
retirement or resignation. It is intended that the shares represented by each
proxy will be voted cumulatively as to each class, in the discretion of the
proxies, for the nominees for Directors set forth below, each of whom is an
incumbent, or for any substitute nominee or nominees designated by the Board of
Directors in the event any nominee or nominees become unavailable for election.
The principal occupations of, and certain other information regarding, the
nominees and the continuing Directors, are set forth below.
------------------
Nominees to Serve in the Class whose Term expires in the Year 2003
------------------
Steven Mason photo STEVEN C. MASON, Retired Chairman of the Board and Chief
Executive Officer, Mead Corporation. Mr. Mason, 64, has
been a Director of PPG since 1990. He was Chairman of the
Board and Chief Executive Officer of Mead Corporation, a
forest products company, from 1992, until his retirement
in 1997. He is also a director of Convergys Corp. and The
Elder-Beerman Stores Corp.
Thomas Usher photo THOMAS J. USHER, Chairman of the Board and Chief
Executive Officer, USX Corporation. Mr. Usher, 57, has
been a Director of PPG since 1996. He has been Chairman
of the Board and Chief Executive Officer of USX
Corporation, a major producer of energy and metal
products, since 1995. He served as President of the U.S.
Steel Group from 1991 until 1994 and as President and
Chief Operating Officer of USX from 1994 until 1995. He
is also a director of PNC Bank Corp. and Transtar, Inc.
David Whitwam photo DAVID R. WHITWAM, Chairman of the Board and Chief
Executive Officer, Whirlpool Corporation. Mr. Whitwam,
58, has been a Director of PPG since 1991. He has been
Chairman of the Board and Chief Executive Officer of
Whirlpool Corporation, a manufacturer and distributor of
household appliances and related products, since 1987.
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------------------
Continuing Directors -- Term Expires in 2001
------------------
Erroll Davis photo ERROLL B. DAVIS, JR., President and Chief Executive
Officer, Alliant Energy, an electric, gas and water
utility company formed as the result of a merger of WPL
Holdings, Inc., IES Industries Inc. and Interstate Power
Co., in April 1998. Mr. Davis, 55, has been a Director
of PPG since 1994. Prior to the merger which formed
Alliant Energy, he was President and Chief Executive
Officer of Wisconsin Power and Light Company and WPL
Holdings, Inc. He was President of Wisconsin Power and
Light Company from 1987 until April 1998 and Chief
Executive Officer from 1988 until April 1998. He was
President and Chief Executive Officer of WPL Holdings,
Inc., the parent company of Wisconsin Power and Light
Company, from 1990 until April 1998. He is also a
director of BP Amoco Corporation and Alliant Energy.
Allen Krowe photo ALLEN J. KROWE, Retired Director and Vice Chairman,
Texaco Inc. Mr. Krowe, 67, has been a Director of PPG
since 1987. He was Vice Chairman of Texaco Inc., an
international petroleum company, from 1993, until his
retirement in 1997, having served as Chief Financial
Officer from 1988 to 1994. He is also a director of
I.B.J. Whitehall Bank & Trust Company and Navistar
International Corporation.
Robert Mehrabian photo ROBERT MEHRABIAN, President and Chief Executive Officer,
Teledyne Technologies Inc. Dr. Mehrabian, 58, has been a
Director of PPG since 1992. He has been President and
Chief Executive Officer of Teledyne Technologies Inc., a
provider of aerospace, electronic and communications
products, and systems engineering services, since it was
formed as a spin-off of Allegheny Teledyne Inc. in
November 1999. He was Executive Vice President of
Allegheny Teledyne Inc., a manufacturer of specialty
metals, aerospace, electronics, industrial and consumer
products, from May 1998 until November 1999. He was
Senior Vice President and Segment Executive of Allegheny
Teledyne Inc. from 1997 until May 1998. From 1990 until
1997 he was President of Carnegie Mellon University, an
educational institution. He is also a director of
Teledyne Technologies Inc., Mellon Financial Corporation
and BEI Technologies, Inc.
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<PAGE> 10
------------------
Continuing Directors-Term Expires in 2002
------------------
Michele Hooper photo MICHELE J. HOOPER, President and Chief Executive Officer
of Voyager Expanded Learning, Inc. Ms. Hooper, 48, has
been a Director of PPG since 1995. She has been President
and Chief Executive Officer of Voyager Expanded Learning,
Inc., a developer and provider of learning programs and
teacher training to public schools, since August 1999.
She was President and Chief Executive Officer of
Stadtlander Drug Company, Inc., a provider of
disease-specific pharmaceutical care from June 1998 until
Stadtlander was acquired in January 1999. From 1992,
until June 1998, she was President, International
Business Group of Caremark International, Inc., an
alternative-site health care provider which is a
subsidiary of Medpartners, Inc. She was also Corporate
Vice President of Caremark International Inc., from 1993
until June 1998. She is also a Director of Target
Corporation and The Seagram Company Ltd.
Raymond LeBoeuf photo RAYMOND W. LEBOEUF, Chairman of the Board and Chief
Executive Officer, PPG Industries, Inc. Mr. LeBoeuf, 53,
has been a Director of PPG since 1995 when he also became
President and Chief Operating Officer of the Company. He
served as Executive Vice President from April 1994 to
December 1995, Vice President, Coatings and Resins from
March 1994 to April 1994, and Vice President, Finance and
Chief Financial Officer from 1988 until March 1994. He is
also a director of Praxair, Inc.
David Vice photo DAVID G. VICE, Retired Vice-Chairman, Products and
Technology, Northern Telecom Limited. Mr. Vice, 66, has
been a Director of PPG since 1988. He was Vice-Chairman,
Products and Technology, of Northern Telecom Limited, a
telecommunications systems company, from 1990 until his
retirement in 1992. He is also a director of Sun Life
Assurance Company of Canada and Stackpole Limited.
COMMITTEES OF THE BOARD
The Board of Directors has appointed several standing committees, including
an Audit Committee, a Nominating and Governance Committee, an Officers-Directors
Compensation Committee and an Investment Committee. During 1999, the Board held
nine meetings, while the Audit Committee held three meetings, the Nominating and
Governance Committee four meetings, the
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Officers-Directors Compensation Committee three meetings and the Investment
Committee two meetings. The average attendance at meetings of the Board and
Committees of the Board during 1999 was over 92%, and each Director attended at
least 80% of the total number of meetings of the Board and Committees of the
Board on which such Director served. Descriptions of the Audit, Nominating and
Governance, Officers-Directors Compensation and Investment Committees are set
forth below. None of the members of those Committees is a past or present
employee or officer of the Company.
Audit Committee--The functions of the Audit Committee are primarily to
review with the independent public accountants and the Company's officers and
internal auditors their respective reports and recommendations concerning audit
findings and the scopes of and plans for their future audit programs and to
review audits, annual financial statements, accounting and financial controls
and compliance with appropriate codes of conduct. The Audit Committee also
recommends to the Board of Directors the independent public accountants to be
recommended for election annually by the shareholders. The members of the Audit
Committee are Erroll B. Davis, Jr., Michele J. Hooper, Steven C. Mason (Chair)
and Robert Mehrabian.
Nominating and Governance Committee--The Nominating and Governance
Committee recommends to the Board of Directors the persons to be nominated by
the Board to stand for election as Directors at each Annual Meeting of
Shareholders, the person or persons to be elected by the Board to fill any
vacancy or vacancies in its number, the persons to be elected by the Board to be
Chairman of the Board, Vice Chairman of the Board, if any, President, and the
Executive Officers of the Company, actions to be taken regarding the structure,
organization and functioning of the Board, and the persons to serve as members
of the standing committees of, and certain committees appointed by the Board.
The Nominating and Governance Committee also annually reports to the Board the
Committee's assessment of the performance of the Board as a whole. The members
of the Nominating and Governance Committee are Michele J. Hooper, Allen J. Krowe
(Chair), David G. Vice and David R. Whitwam.
The Company's bylaws provide that nominations for persons to stand for
election as Directors may be made by holders of record of Common Stock entitled
to vote in the election of the Directors to be elected, provided that a
nomination may be made by a shareholder at a meeting of shareholders only if
written notice of such nomination is received by the Secretary of the Company
not later than (i) with respect to an election to be held at an Annual Meeting
of Shareholders, held on the third Thursday in April, ninety days prior to such
Annual Meeting and (ii) with respect to an election to be held at an Annual
Meeting of Shareholders held on a date other than the third Thursday in April or
an election to be held at a special meeting of shareholders, the close of
business on the tenth day following the date on which notice of such meeting is
first given to shareholders. Each notice of nomination from a shareholder must
set forth: (a) the name and address of the shareholder who intends to make the
nomination and of the person or persons to be nominated; (b) a representation
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that the shareholder is a holder of record of stock of the Company entitled to
vote at such meeting and intends to be present at the meeting in person or by
proxy to nominate the person or persons specified in the notice; (c) a
description of all arrangements or understandings between the shareholder and
each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by the
shareholder; (d) such other information regarding each nominee proposed by such
shareholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission, had the
nominee been nominated by the Board of Directors; and (e) the written consent of
each nominee, signed by such nominee, to serve as a director of the Company if
so elected.
Officers-Directors Compensation Committee--The Officers-Directors
Compensation Committee approves, adopts, administers, interprets, amends,
suspends and terminates the compensation plans of the Company applicable to, and
fixes the compensation and benefits of, all officers of the Company serving as
Directors of the Company (currently only Raymond W. LeBoeuf) and all Executive
Officers of the Company. The members of the Officers-Directors Compensation
Committee are Steven C. Mason, Robert Mehrabian, Thomas J. Usher and David R.
Whitwam (Chair).
Investment Committee--The Investment Committee reviews the investment
policies of the Company concerning its pension plans and certain benefit plans
and the asset investment policies of the PPG Industries Foundation (the
"Foundation"). The Committee also reviews (i) the selection of providers of
services to such pension and benefit plans of the Company and to the Foundation,
(ii) the allocations of assets among classes and the performance of the
investments of such pension and benefit plans and the Foundation, and (iii) the
actuarial assumptions concerning and the funding levels of the Company's pension
plans. The members of the Investment Committee are Erroll B. Davis, Jr. (Chair),
Allen J. Krowe, Thomas J. Usher and David G. Vice.
------------------------
COMPENSATION OF DIRECTORS
Directors who are not also Officers receive a basic annual retainer of
$30,000 and a fee of $1,000 for each Board or Committee meeting they attend. In
addition, the members of the Audit Committee receive an annual retainer of
$4,000 while the members of the Nominating and Governance, Officers-Directors
Compensation and Investment Committees receive an annual retainer of $3,000 for
each Committee. The Chair of each Committee receives an additional $1,000
annually. Any Director who is also an Officer receives no compensation as a
Director.
Under the Company's Deferred Compensation Plan for Directors, each Director
must defer receipt of such compensation as the Board mandates. Currently, the
Board mandates deferral of one-third of each payment of the basic annual
retainer of each Director. Each Director may also elect to
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defer the receipt of (i) an additional one-third of each payment of the basic
annual retainer, (ii) all of the basic annual retainer or (iii) all
compensation. All deferred payments are held in the form of Common Stock
Equivalents and earn dividend equivalents until paid. Payments will be made in
the Common Stock of the Company (and cash as to any fractional Common Stock
Equivalents).
Under the Directors' Common Stock Plan, each Director who neither is nor
was an employee of the Company and who serves on the Board of Directors as of
the day following each Annual Meeting of Shareholders is credited with Common
Stock Equivalents worth one-half of the Director's basic annual retainer. The
Common Stock Equivalents held in each Director's account earn dividend
equivalents until paid. Upon termination of service and attaining 70 years of
age, the Common Stock Equivalents held in a Director's account will be paid in
Common Stock (and cash as to any fractional Common Stock Equivalents) in annual
installments to the Director, or the Director's spouse in the event of the
Director's death.
Common Stock Equivalents under both the Deferred Compensation Plan for
Directors and the Directors' Common Stock Plan are hypothetical shares of Common
Stock having a value on any given date equal to the value of a share of Common
Stock. Common Stock Equivalents carry no voting rights or other rights afforded
to a holder of Common Stock.
As part of its overall program to promote charitable giving, the Company
has established a Directors' charitable award program funded by insurance
policies on the lives of Directors. Each of the Company's Directors participates
in the program. Upon the death of an individual Director, the Company will
donate an amount up to and including a total of $1 million to one or more
qualifying charitable organizations designated by such Director and approved by
the Company. The Company will subsequently be reimbursed from the proceeds of
the life insurance policies. Individual Directors derive no financial benefit
from this program since all charitable deductions accrue solely to the Company.
OTHER TRANSACTIONS
PPG and its subsidiaries purchase products and services from and/or sell
products and services to companies of which certain of the Directors of PPG are
executive officers or were executive officers during 1999. PPG does not consider
the amounts involved in such transactions material. Such purchases from and
sales to each company involved less than 1% of the consolidated gross revenues
for 1999 of the purchaser and seller and all of such transactions were in the
ordinary course of business. Some of such transactions are continuing, and it is
anticipated that similar transactions will recur from time to time.
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<PAGE> 14
COMPENSATION OF EXECUTIVE OFFICERS
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Officers-Directors Compensation Committee of the Board of Directors is
responsible for determining and administering the policies which govern the
executive compensation programs of the Company. The Committee, which consists
entirely of independent outside Directors, met three times in 1999 to establish
Company performance goals, base salary pay levels and target annual bonus
awards, to approve annual bonus payments and to establish and approve long-term
incentives for the CEO and the other four executives named in the compensation
table below (collectively, the "Named Executives") and certain other Officers of
the Company.
Philosophy
The philosophy of the Committee is that the interests of the Company and
its shareholders require attracting and retaining the best possible executive
talent, motivating executives to achieve goals which support business strategies
and linking executive and shareholder interests. The Committee believes this is
generally best accomplished by compensating the CEO and other Executive Officers
(referred to collectively in this Proxy Statement as the "Executives")
competitively while having a significant portion of their total compensation
variable and related to the performance of the Company against established goals
and to their overall personal performance in directing the enterprise. The
Committee also utilizes equity based plans for a portion of compensation to link
executive and shareholder interests.
Annual Compensation Programs
The levels of base salary and target annual bonuses for the Executives,
including Named Executives, are established annually under a program intended to
maintain parity with the market for similar positions. Total annual compensation
is targeted at the median of the market value for each position based on data
available from several independent market surveys. The Committee believes that
the most direct competitors for executive talent are not necessarily the
companies that are included in the Dow Jones Industrial Diversified Index. Thus,
the companies compared for annual compensation purposes and the companies
compared for long-term compensation purposes are not the same as the companies
included in the index used in the Comparison of Five-Year Cumulative Total
Shareholder Return graph on page 23.
The Executives' base salaries are maintained below the median of the market
survey of comparison data. Annual bonus awards under the Company's Incentive
Compensation Plan are then targeted at a level that, when combined with base
salaries, approximates the median base salary and annual bonus paid by companies
represented in the salary data. Competitive total compensation is
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achieved when target performance is met but with a larger percent of pay at risk
than is the case in the comparison companies.
Total annual compensation should exceed the median of the comparison data
when Company financial performance meets or exceeds targets established by the
Committee and individual performance contributes to meeting strategic objectives
of the Company. Total annual compensation should be below the median of the
comparison data when Company financial performance does not meet targets and/or
individual performance does not have a positive effect on strategic objectives.
The financial performance targets established by the Committee are based on
earnings growth, Return on Capital (ROC) and Return on Equity (ROE). On a
limited basis, the Committee may decide not to include some one-time accounting
adjustments in determining whether the financial performance targets are met.
Bonus awards are calculated using these financial targets and an assessment of
personal performance related to achievement of strategic objectives of the
Company. The personal performance rating of the CEO is determined by the
Committee and the other Executives are rated by the CEO.
Final awards are subject to the discretion of the Committee as permitted in
the Incentive Compensation Plan approved by the shareholders. If minimum
thresholds of earnings growth, ROC, and ROE are not achieved, no awards are
granted by the Committee. The Committee has traditionally determined that 20% of
the annual bonus award be paid in Common Stock of the Company to build ownership
levels and to align the interests of the Executives more closely with those of
the shareholders.
Long-Term Incentive Programs
The Committee has established long-term incentive programs that motivate
key employees to invest in the stock of the Company and to cause the Company to
grow and profit, provide compensation levels competitive with opportunities
available elsewhere in industry and encourage key employees to continue in the
employ of the Company.
Long-term incentives for the Named Executives are currently provided under
the PPG Industries, Inc. Stock Plan (the "Stock Plan") and the Total Shareholder
Return Plan for Key Employees (the "TSR Plan"). These programs, in combination,
provide compensation opportunities competitive with long-term incentive
compensation opportunities for large companies identified by independent
compensation consulting firms as potential competitors for executive talent.
The Stock Plan has been approved by shareholders and provides for the
granting of stock options to selected employees. The number of stock options
granted to Named Executives is determined so that an estimate of potential value
of the options and payments under the TSR Plan, when combined with annual
compensation discussed above will approximate the median total annual and
long-term
12
<PAGE> 16
compensation paid to executives in the comparison companies. The number of
option shares granted is not determined by past Company performance and is not
dependent on the number granted in the past or the number presently held. The
options are performance related since the value of the option is ultimately
determined by the future performance of the Company as reflected by stock price.
Also, as shown in the Option/SAR Grants in Last Fiscal Year table and
related footnotes on pages 17-19, the Named Executives exercised existing
options in a manner entitling them to receive Restored Options under the
Restored Option provisions of the Stock Plan. The Restored Option provisions
encourage Optionees to exercise options earlier during the option term, thereby
building stock ownership to better align their interests with the interests of
shareholders.
The TSR Plan provides long-term incentive for Named Executives to generate
high shareholder return in relation to the S&P 500 companies. Contingent share
grants are made at the beginning of three year plan periods and are paid at the
end of a period if the Company achieves targeted performance. Payments are
performance based because payments at the end of the period will be zero if
minimum performance is not achieved and payments may exceed the original
contingent share grant if shareholder return vs. the S&P 500 is above target.
Please see the table on page 21 for contingent grants to Named Executives and
additional plan detail.
CEO Compensation
Mr. LeBoeuf's base salary in 1999 increased by 17% over the amount he
received in 1998, which was his first full year as Chairman and CEO. This change
includes movement toward more competitive base compensation appropriate to his
position as determined according to the competitive salary program described
above. Consistent with the Company's philosophy, the fixed salary portion of Mr.
LeBoeuf's compensation is below the median base salary paid by the comparison
companies. His annual bonus for 1999 was determined 80% on performance of the
Company against financial goals and 20% on personal performance against
non-financial goals related to strategic objectives of the Company. The
Committee rated Mr. LeBoeuf's 1999 performance toward achieving strategic
objectives related to growth initiatives, strategic planning, capital
allocation, responsiveness to PPG's shareholders and the general management of
corporate issues as meeting requirements. However, the financial performance of
the Company in 1999 did not meet requirements for target compensation. Mr.
LeBoeuf's 1999 annual bonus, therefore, was below the established target level.
Mr. LeBoeuf was granted 110,000 option shares at Fair Market Value on the
date of grant and a contingent share grant of 30,000 shares under the TSR Plan.
These grants are consistent with the Committee's philosophy that the estimated
value of the these programs combined with targeted annual compensation will be
competitive with total annual and long-term compensation provided by companies
that are potential competitors for executive talent. Also in 1999 Mr. LeBoeuf
received Restored Options for 111,629 shares under the Restored Option
provisions of the Stock Plan.
13
<PAGE> 17
Other Named Executives' Compensation
The accompanying compensation tables also list four Executives other than
Mr. LeBoeuf ("Other Named Executives"). The Other Named Executives' base
salaries were increased over 1998 base salaries consistent with our base pay
practice discussed above. The increases in base salary over 1998 for Messrs.
Archinaco, Pollock, and Bunch reflect their second year in new positions. Mr.
Hernandez' increase is in line with competitive market movement for his
position. Current base salary levels are below the median base salary position
of the comparison companies. The Other Named Executives' annual bonus awards
were based on Company financial performance measures and non-financial measures
directly related to their corporate objectives.
The size of the stock option grants under the Stock Plan and contingent
share grants under the TSR Plan to Other Named Executives is consistent with the
philosophy above and represents a level of long-term incentive that is
competitive with the median provided by comparison companies for individuals
with similar levels of responsibility. The Other Named Executives also received
Restored Options as stated in the Option/SAR Grants in Last Fiscal Year table
and related footnotes on pages 17-19.
Deductibility of Compensation
Gains realized from exercising options under the long-term incentive Stock
Plan are exempt from the deductibility limitations under Section 162(m) of the
Internal Revenue Code. Compensation paid from the annual bonus plan does not
qualify for exemption from deductibility limits under Section 162(m). The
Committee believes the annual bonus program must be sufficiently flexible to
allow the Committee to adjust awards appropriately for the effect of unusual
events such as acquisitions, divestitures and other major corporate, accounting
or legal changes impacting on financial performance. This ability to exercise
discretion under the terms of the annual bonus plan in the view of the Committee
is in the best interests of the Company and its shareholders and outweighs the
need to qualify all plans so that income paid through the plans is exempt from
the deductibility limits of Section 162(m) of the Internal Revenue Code.
Nonetheless, all taxable income for 1999 of the CEO and Other Named Executives
qualified under Section 162(m) as deductible by the Company.
14
<PAGE> 18
Summary
Through the programs and actions of the Committee described above, a very
significant portion of the Company's executive compensation is linked directly
to Company performance and returns to shareholders. The Officers-Directors
Compensation Committee intends to continue this policy.
<TABLE>
<S> <C>
The Officers-Directors Compensation Committee:
Steven C. Mason Thomas J. Usher
Robert Mehrabian David R. Whitwam
</TABLE>
15
<PAGE> 19
SUMMARY OF NAMED EXECUTIVES' COMPENSATION
There is shown below information concerning the annual and long-term
compensation for services in all capacities to the Company for the fiscal years
ended December 31, 1999, 1998 and 1997, of those persons who (i) served as the
Chief Executive Officer of the Company at any time during 1999 and (ii) the
other four most highly compensated Executive Officers of the Company at December
31, 1999.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term Compensation
----------------------------
Annual Compensation Awards
-------------------------------------- ----------------------------
Other Securities
Annual Underlying All Other
Name and Compen- Options/SARs Compen-
Principal Position Year Salary ($) Bonus ($)(1) sation ($) (#) sation($)(2)
------------------ ---- ---------- ------------ ---------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
R. W. LeBoeuf 1999 800,000 900,000 9,496 221,629 104,550
Chairman and 1998 685,000 1,050,000 10,514 187,446 58,620
Chief Executive Officer 1997 600,833 650,000 6,060 244,640 43,679
F. A. Archinaco 1999 450,000 350,000 5,924 98,775 43,650
Executive Vice President 1998 400,000 380,000 4,886 151,756 32,477
1997 370,167 300,000 3,617 127,602 26,860
E. K. Pollock 1999 450,000 350,000 3,380 144,557 37,621
Executive Vice President 1998 400,000 380,000 2,900 93,293 22,780
1997 370,167 300,000 6,093 103,280 20,825
W. H. Hernandez 1999 350,000 240,000 1,672 58,504 28,753
Sr. Vice President, 1998 325,000 250,000 1,245 44,027 19,983
Finance 1997 296,667 220,000 986 36,370 18,364
C. E. Bunch 1999 315,000 240,000 3,214 53,211 27,872
Sr. Vice President, 1998 290,000 240,000 4,859 103,188 22,889
Strategic Planning and 1997 255,850 190,000 10,949 87,846 19,727
Corporate Services
</TABLE>
- ------------
(1) Cash and market value of Common Stock awarded.
(2) The following are included in the amounts shown under All Other Compensation
for 1999: Company contributions under the Company's Employee Savings Plan
for Messrs. LeBoeuf, Archinaco, Pollock, Hernandez and Bunch, respectively,
were $10,027, $10,027, $10,027,
16
<PAGE> 20
$10,027 and $10,027, and under the Company's Benefit Account Plan were $300,
$300, $300, $300, and $300. The value of premiums paid with respect to term
life insurance for the benefit of Messrs. LeBoeuf, Archinaco, Pollock,
Hernandez and Bunch, respectively, was $879, $850, $873, $325, and $340. The
amount shown for Mr. LeBoeuf includes $7,881 and for Mr. Archinaco includes
$1,576, which are the portions of interest earned on certain deferred
compensation above 120% of the applicable federal rate. The amounts shown
for Messrs. LeBoeuf, Archinaco, Pollock, Hernandez, and Bunch include
$39,863, $17,976, $13,500, $10,500 and $9,604, respectively, in Company
contributions under the PPG Industries, Inc. Deferred Compensation Plan in
lieu of contributions which could not be made under the Savings Plan because
of the Internal Revenue Code and Regulations. The figure also includes for
Messrs. LeBoeuf, Archinaco, Pollock, Hernandez, and Bunch $45,600, $12,920,
$12,920, $7,600, and $7,600 for dividends accrued but not paid under the
Total Shareholder Return Plan.
OPTION GRANTS
Shown below is further information on grants of Options under the Company's
Stock Plan during fiscal year 1999 to the Named Executives. All of the Options
granted in 1999 were Nonqualified Options, as are all outstanding Options. No
Stock Appreciation Rights were granted in 1999 and none are outstanding.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential Realizable Value at Assumed
Annual Rates of Stock Price
Individual Grants Appreciation for Option Term(2)
-------------------------------------------------------- ------------------------------------------
Percent of
Number of Total
Securities Options/SARs
Underlying Granted to Exercise or
Options/SARs Employees in Base Price Expiration
Name Granted (#)(1) Fiscal 1999 ($/Share) Date 0% ($)(3) 5% ($) 10% ($)
---- -------------- ----------- --------- ---- --------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
R. W. LeBoeuf 110,000 3.53 52.125 2/16/2009 0 3,606,350 9,138,250
36,335 1.17 69.688 2/14/2005 0 861,212 1,953,806
30,574 .98 69.688 2/15/2004 0 588,611 1,300,679
44,720 1.43 69.688 2/18/2007 0 1,487,924 3,563,826
------- --- ------------- --------------
221,629 0 6,544,097 15,956,561
</TABLE>
17
<PAGE> 21
<TABLE>
<CAPTION>
Potential Realizable Value at Assumed
Annual Rates of Stock Price
Individual Grants Appreciation for Option Term(2)
-------------------------------------------------------- ------------------------------------------
Percent of
Number of Total
Securities Options/SARs
Underlying Granted to Exercise or
Options/SARs Employees in Base Price Expiration
Name Granted (#)(1) Fiscal 1999 ($/Share) Date 0% ($)(3) 5% ($) 10% ($)
---- -------------- ----------- --------- ---- --------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
F. A. Archinaco 45,000 1.44 52.125 2/16/2009 0 1,475,325 3,738,375
8,067 .26 60.813 2/15/2004 0 135,501 299,504
19,069 .61 60.813 2/18/2002 0 182,815 383,802
1,667 .05 60.813 2/19/2001 0 10,397 21,283
4,543 .15 60.813 2/19/2001 0 28,335 58,000
12,199 .39 60.813 2/18/2002 0 116,952 245,529
366 .01 60.813 2/19/2001 0 2,283 4,673
6,520 .21 60.813 2/16/2003 0 85,458 184,040
1,344 .04 60.813 2/18/2002 0 12,885 27,051
------- ------------- --------------
98,775 2,049,951 4,962,257
E. K. Pollock 45,000 1.44 52.125 2/16/2009 0 1,475,325 3,738,375
6,880 .22 64.813 2/18/2007 0 212,915 509,925
2,206 .07 64.813 2/19/2001 0 14,663 30,017
20,942 .67 64.813 2/14/2005 0 461,708 1,047,247
3,650 .12 64.813 2/18/2002 0 37,292 78,318
4,164 .13 64.813 2/11/2000 (5) (5) (5)
9,139 .29 64.813 2/18/2002 0 93,373 196,096
3,656 .12 64.813 2/18/2002 0 37,353 78,447
5,238 .17 60.125 2/18/2002 0 49,630 104,262
13,846 .44 60.125 2/13/2006 0 338,881 789,845
5,111 .16 60.125 2/18/2002 0 48,427 101,734
4,488 .14 60.125 2/19/2001 0 27,669 56,661
3,566 .11 60.125 2/18/2002 0 33,788 70,981
16,671 .53 60.125 2/15/2004 0 276,989 611,909
------- ------------- --------------
144,557 3,108,013 7,413,817
W. H. Hernandez 30,000 .96 52.125 2/16/2009 0 983,550 2,492,250
12,697 .41 63.438 2/14/2005 0 273,900 621,417
15,807 .51 59.250 2/14/2005 0 318,511 722,538
------- ------------- --------------
58,504 1,575,961 3,836,205
C. E. Bunch 28,500 .91 52.125 2/16/2009 0 934,373 2,367,638
3,396 .11 64.125 2/11/2000 (5) (5) (5)
4,746 .15 64.125 2/19/2001 0 31,205 63,905
2,837 .09 64.125 2/18/2002 0 28,668 60,215
1,949 .06 64.125 2/16/2003 0 26,925 58,012
11,237 .36 64.125 2/16/2003 0 155,239 334,469
546 .02 64.125 2/13/2006 0 14,253 33,216
------- --- ------------- --------------
53,211 0 1,190,663 2,917,455
</TABLE>
18
<PAGE> 22
<TABLE>
<CAPTION>
Potential Realizable Value at Assumed
Annual Rates of Stock Price
Individual Grants Appreciation for Option Term(2)
-------------------------------------------------------- ------------------------------------------
Percent of
Number of Total
Securities Options/SARs
Underlying Granted to Exercise or
Options/SARs Employees in Base Price Expiration
Name Granted (#)(1) Fiscal 1999 ($/Share) Date 0% ($)(3) 5% ($) 10% ($)
---- -------------- ----------- --------- ---- --------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
All Shareholders(4) 0 5,707,869,000 14,463,358,000
Named Executive
Officers' Gain as %
of All Shareholders'
Gain 0% 2.53% 2.43%
</TABLE>
- ------------
(1) All Options were granted at Fair Market Value (the closing price for the
Company's Common Stock as reported on the New York Stock Exchange-Composite
Transactions) on the date of grant. Five of the option grants shown were
granted on February 17, 1999, at an Exercise Price of $52.125 and become
exercisable one year after the date of grant. The other Options shown on the
table were granted under the Restored Option provisions of the Stock Plan
that were approved by the shareholders in 1992. Under the Restored Option
provisions, an Optionee who surrenders (or certifies ownership of) shares of
Common Stock in payment of the Option Price of an Option is granted a new
Nonqualified Option (a "Restored Option") covering the number of shares
equal to the number of shares surrendered (or certified as to ownership) and
surrendered or withheld to satisfy tax obligations. Restored Options have
the same expiration date as the original Option, the exercise of which
generated the Restored Option, an Exercise Price equal to the Fair Market
Value of the Common Stock on the Date of Grant of the Restored Option and
become exercisable six months after the Date of Grant.
(2) The dollar amounts under these columns are the result of calculations at 0%,
and at the 5% and 10% rates set by the Securities and Exchange Commission
and, therefore, are not intended to forecast possible future appreciation,
if any, of PPG's Common Stock price. PPG did not use an alternative formula
for a grant date valuation, as the Company is not aware of any formula which
will determine with reasonable accuracy a present value based on future
unknown or volatile factors.
(3) No gain to the Optionees is possible without an increase in stock price. A
0% gain in stock price will result in zero gain for the Optionee.
(4) Based on 174,100,000 issued shares (other than Treasury shares), these
amounts are the total increase in shareholder value using the 0%, 5%, and
10% assumed annual appreciation rates and the price and terms of the
February 17, 1999, grant.
(5) No future appreciation is shown since this grant terminated unexercised on
February 11, 2000.
19
<PAGE> 23
OPTION EXERCISES AND FISCAL YEAR-END VALUES
Shown below is information with respect to exercises during 1999 of Options
granted under the Stock Plan and information with respect to unexercised Options
granted in 1999 and prior years under the Stock Plan.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options/SARs at In-the-Money Options/SARs
December 31, 1999(#) at December 31, 1999 ($)(1)
Shares --------------------------- ---------------------------
Acquired on Value
Name Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
---- ------------ ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
R. W. LeBoeuf 124,089 1,919,157 407,297 110,000 516,204 1,148,180
F. A. Archinaco 54,563 105,112 203,808 45,000 267,351 469,710
E. K. Pollock 105,315 574,869 143,930 93,920 30,960 588,977
W. H. Hernandez 34,615 818,284 140,852 45,807 1,151,119 365,509
C. E. Bunch 25,504 111,580 128,045 28,500 122,535 297,483
</TABLE>
- ---------------
(1) Based on the closing price on the New York Stock Exchange-Composite
Transactions of the Company's Common Stock on December 31, 1999 (last
trading day of fiscal year), which was $62.563 per share.
LONG-TERM INCENTIVE PLAN AWARDS
During 1999, the Officers-Directors Compensation Committee made contingent
grants of PPG Common Stock to the Named Executives under the Total Shareholder
Return Plan for Key Employees. The Plan was formerly called the 1984 Earnings
Growth Plan. In 1999 the Plan was amended and renamed the Total Shareholder
Return Plan (the "TSR Plan"). Under the TSR Plan, contingent share grants are
made at the beginning of three year plan periods and paid out at the end of the
period if the Company achieves target performance. Performance is measured by
determining where the total shareholder return of PPG Common Stock (stock price
plus accumulated dividends) ranks among the total shareholder return for each of
the companies in the Standard & Poor's 500 Stock Index. If target performance is
met at the end of the award period, payments will equal the original contingent
share grant. Payments at the end of the period will be zero if threshold
performance is not achieved and may exceed the original contingent grant if PPG
total shareholder return is above target performance. Contingent share awards
earn dividend equivalents during the award period which are credited in the form
of stock equivalents under the PPG Deferred Compensation Plan. Any payments made
at the end of the award period under the TSR Plan may be in the form of stock,
cash (based on the market value of the number of contingent shares paid in the
20
<PAGE> 24
form of cash) or a combination of both, and may be deferred into the PPG
Deferred Compensation Plan.
LONG-TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Estimated Future Payouts
Under Non-Stock Price-Based Plans
Number of Performances or ---------------------------------------------
Shares, Units or Other Period
Other Rights Until Maturation Minimum Threshold Target Maximum
Name (# of Shares) or Payout (# of Shares) (# of Shares) (# of Shares) (# of Shares)
---- ------------- --------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
R. W. LeBoeuf 30,000 1/1/1999 - 12/31/2001 0 12,000 30,000 66,000
F. A. Archinaco 8,500 1/1/1999 - 12/31/2001 0 3,400 8,500 18,700
E. K. Pollock 8,500 1/1/1999 - 12/31/2001 0 3,400 8,500 18,700
W. H. Hernandez 5,000 1/1/1999 - 12/31/2001 0 2,000 5,000 11,000
C. E. Bunch 5,000 1/1/1999 - 12/31/2001 0 2,000 5,000 11,000
</TABLE>
RETIREMENT PLANS
The Company's qualified retirement plan for salaried employees and
nonqualified retirement plan provide benefits after retirement. The annual
benefits payable upon retirement under those plans to persons in hypothetical
five-year average annual covered compensation and credited years-of-service
classifications (assuming retirement as of January 1, 2000, and date of birth in
1934) are estimated in the following table.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
Base and Incentive Credited Years-of-Service
5-Year Avg. -------------------------------------------------
Total Compensation 15 20 25 30 35
- ------------------ -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$ 400,000 89,553 119,404 149,255 179,106 208,957
500,000 113,553 151,404 189,255 227,106 264,957
600,000 137,553 183,404 229,255 275,106 320,957
750,000 173,553 231,404 289,255 347,106 404,957
1,000,000 233,553 311,404 389,255 467,106 544,957
1,300,000 305,553 407,404 509,255 611,106 712,957
1,600,000 377,553 503,404 629,255 755,106 880,957
</TABLE>
The compensation covered by the Company's qualified retirement plan for
salaried employees, which is compulsory and noncontributory, is the salary of a
participant as limited by applicable Internal Revenue Service ("IRS")
regulations. The compensation covered by the Company's nonqualified retirement
plan, which is available only to those employees who participate in the
qualified retirement plan for salaried employees and in the Company's Incentive
Compensation Plan or Management Award Plan, is the compensation paid under the
latter two plans, which for the Named Executives in the Summary Compensation
Table on page 16 is shown in the "Bonus" column
21
<PAGE> 25
under "Annual Compensation". Additional benefits may be paid to certain
participants under the Company's nonqualified retirement plan equal to any
benefit which cannot be paid under the Company's qualified retirement plan for
salaried employees because of the restrictions of any applicable IRS
regulations. The benefit payable under the Company's qualified retirement plan
for salaried employees is a function of a participant's highest consecutive
five-year average annual covered compensation during the ten years immediately
prior to retirement and credited years-of-service while a plan participant. The
benefit payable under the Company's nonqualified retirement plan is a function
of the participant's five-year average annual covered compensation for the
highest five years out of the final ten years immediately prior to retirement
and credited years-of-service. The highest five-year average annual covered
compensation under both plans through 1999 for Messrs. LeBoeuf, Pollock,
Archinaco, Hernandez and Bunch is $1,288,640, $657,356, $679,046, $545,038 and
$451,216, respectively. The annual benefits payable under the plans as shown in
the table above are estimated on the basis of a straight life annuity
notwithstanding the availability of a joint and survivor annuity or lump sum
benefit and are not subject to reduction for social security benefits. For
purposes of the plans, Mr. LeBoeuf has nineteen years of service, Mr. Pollock
thirty-three and one-half years, Mr. Archinaco thirty-four and one-half years,
Mr. Hernandez nine years and Mr. Bunch twenty and one-half years.
CHANGE IN CONTROL ARRANGEMENTS
The Company has entered into arrangements with certain key executives,
including the Named Executives, providing for the continued employment of such
executives for a period of up to three years following a change in control of
the Company. The arrangements contemplate that during such three-year period,
such executives would continue to be employed in capacities, and compensated on
a basis, commensurate with their capacities and compensation before the change
in control occurred. The arrangements contemplate, further, that in the event
the executive's employment is terminated (a) for any reason by the executive
during a thirty day window period beginning one year after a change in control,
(b) at any time during the three years following a change in control by the
executive because either he has not been employed in a commensurate capacity or
he has not been commensurately compensated or (c) by the Company at any time
during the three years following a change in control other than for cause, the
executive would be entitled to receive, subject to certain conditions, a
payment. This payment would basically be the salary and the awards under the
Incentive Compensation Plan and Total Shareholder Return Plan that the Executive
would have received for (i) the next two years (or until the executive's
retirement date if earlier) if the termination was under situation (a) above or
(ii) for three years (or until the executive's retirement date if earlier) if
the termination was under situations (b) or (c) above.
22
<PAGE> 26
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the Company's Common Stock with the
cumulative total return of the Standard & Poor's Composite -- 500 Stock Index
("S&P 500 Index") and the Dow Jones Industrial Diversified Index for the five
year period beginning December 31, 1994 and ending December 31, 1999. The S&P
500 Index and the Dow Jones Industrial Diversified Index data presented in the
graph are based on the companies that comprised those indexes at the time the
graph was prepared on February 10, 2000. The information presented in the graph
assumes that the investment in the Company's Common Stock and each Index was
$100 on December 31, 1994 and that all dividends were reinvested.
------------------------
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL SHAREHOLDER RETURN
PPG INDUSTRIES, INC., DOW JONES INDUSTRIAL DIVERSIFIED INDEX AND S&P 500 INDEX
<TABLE>
<CAPTION>
PPG DJID S&P 500
--- ---- -------
<S> <C> <C> <C>
'94 100.00 100.00 100.00
'95' 128.00 131.00 136.00
'96' 161.00 169.00 167.00
'97' 169.00 222.00 222.00
'98' 177.00 256.00 285.00
'99' 197.00 278.00 345.00
</TABLE>
23
<PAGE> 27
AUDITORS
The Board of Directors, based on the recommendation of the Audit Committee,
has appointed Deloitte & Touche LLP as Auditors for the Company for the year
2000. Deloitte & Touche LLP have been regularly engaged by the Company for many
years to examine the Company's annual financial statements and for other
purposes. Representatives of Deloitte & Touche LLP are expected to be present at
the Meeting and, while they do not plan to make a statement (although they will
have the opportunity if they desire to do so), they will be available to respond
to appropriate questions from shareholders.
------------------------
MISCELLANEOUS
VOTE REQUIRED
The Annual Meeting of Shareholders will not be organized for the
transaction of business unless a quorum is present. The presence in person or by
proxy of shareholders entitled to cast at least a majority of the votes that all
shareholders are entitled to cast shall constitute a quorum. Votes withheld and
abstentions will be counted but broker non-votes will not be counted in
determining the presence of a quorum.
In the election of Directors, the number of nominees to be elected in each
class who receive the greatest number of votes cast at the Annual Meeting by the
holders of the Common Stock present in person or by proxy and entitled to vote,
assuming the presence of a quorum, will be elected as Directors for a term of
three years or their earlier resignation or retirement. Since no written notice
was received by the Company from a shareholder that a nomination would be made
by the shareholder at the Annual Meeting pursuant to the nomination procedure
provided for in the Company's bylaws, votes may only be cast for, or withheld
from, the Company's nominees.
Pennsylvania law provides that abstentions, votes withheld and broker
non-votes are not votes cast. Therefore, with respect to the election of
Directors, abstentions, votes withheld and broker non-votes do not count either
for or against such election.
SOLICITATION COSTS
The costs of the solicitation of proxies will be borne by the Company.
Arrangements may be made by the Company with brokerage houses and other
custodians, nominees and fiduciaries for them to forward solicitation materials
to the beneficial owners of the shares such brokerage houses and other
custodians, nominees and fiduciaries hold of record, and the Company may
reimburse them for the reasonable expenses they incur in so doing. To assist in
the solicitation of proxies, the
24
<PAGE> 28
Company has engaged D.F. King & Co. for a fee of $12,000, plus out-of-pocket
expenses. Directors, Officers or regular employees of the Company may, without
additional compensation therefor, also make solicitations.
SHAREHOLDER PROPOSALS
Shareholders intending to present business for consideration at the year
2001 Annual Meeting of Shareholders must give notice to the Secretary of the
Company within the same time limits as set forth on page 8 for nomination of
Directors and such business must otherwise be a proper matter for shareholder
action. If, as expected, the year 2001 Annual Meeting of Shareholders is held on
April 19, 2001 (the third Thursday of April, 2001), then to be timely the notice
must be received by the Secretary of the Company not later than January 19,
2001, in order to be brought before the Annual Meeting. To be eligible for
inclusion in the Proxy Statement and Proxy Card relating to such Annual Meeting
the notice must be received by the Secretary of the Company not later than
November 7, 2000.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Directors and Executive Officers of the Company are required to file
reports of initial ownership and changes of ownership of PPG securities with the
Securities and Exchange Commission and the New York Stock Exchange. To the
Company's knowledge, based solely on review of copies of such reports furnished
to the Company and written representations that no other reports were required,
the required filings of all such Directors and Executive Officers were filed
timely.
OTHER MATTERS
So far as is known, no matters other than those described herein are
expected to come before the Annual Meeting. It is intended, however, that the
proxies solicited hereby will be voted on any other matters which may properly
come before the Meeting, or any adjournment thereof, in the discretion of the
person or persons voting such proxies unless the shareholder has indicated on
the Proxy Card that the shares represented thereby are not to be voted on such
other matters.
Pittsburgh, Pennsylvania
March 7, 2000
25
<PAGE> 29
PROXY AND VOTING INSTRUCTION CARD
<TABLE>
<S> <C> <C> <C>
Mark box as
indicated in [X]
this example
[LOGO] PPG INDUSTRIES, INC.
One PPG Place TO OBTAIN AN ADMISSION CARD TO THE ANNUAL MEETING, PLACE AN "X" IN THE BOX TO THE RIGHT.
Pittsburgh, PA 15272
---------------------------------------------------------------------------------------- [ ]
- -----------------------------------------------------------------------------------------------------------------------------------
PPG'S DIRECTORS RECOMMEND A VOTE "FOR" ALL NOMINEES.
- -----------------------------------------------------------------------------------------------------------------------------------
ELECTION OF THREE DIRECTORS. FOR WITHHELD FOR, EXCEPT VOTE WITHHELD FROM THE FOLLOWING NOMINEE(S):
ALL FROM
(NOMINEES: STEVEN C. MASON, NOMINEES ALL NOMINEES -------------------------------------------------------
THOMAS J. USHER AND
DAVID R. WHITWAM) [ ] [ ]
- -----------------------------------------------------------------------------------------------------------------------------------
_________
|
|
|
SIGNATURE(S) DATE
-------------------------------------------------------------------------------- --------------------------------
NOTE: PLEASE SIGN AS NAME(S) APPEAR HEREON. GIVE FULL TITLE IF SIGNING FOR A CORPORATION OR PARTNERSHIP OR AS ATTORNEY, AGENT OR IN
ANOTHER REPRESENTATIVE CAPACITY.
- -----------------------------------------------------------------------------------------------------------------------------------
FOLD AND DETACH HERE
</TABLE>
[LOGO] PPG INDUSTRIES, INC.
One PPG Place
Pittsburgh, PA 15272
ANNUAL MEETING OF SHAREHOLDERS - 11:00 A.M. - APRIL 20, 2000
The Annual Meeting of Shareholders of PPG Industries, Inc. will be held on
Thursday, April 20, 2000, at the Sheraton Hotel, Station Square, Pittsburgh,
Pennsylvania, at 11:00 a.m.
The top (blue shaded) portion of this form is your PROXY AND VOTING INSTRUCTION
CARD. Please COMPLETE, SIGN and DATE the CARD and then DETACH and RETURN the
completed CARD promptly in the enclosed reply envelope. You should do so even
if you plan to attend the Annual Meeting. If you do attend, you may override
your proxy and vote in person if you wish.
If you plan to attend the Annual Meeting, please mark an "X" in the request box
provided on the BLUE CARD. An admission card will be mailed to you at the
address already printed on the card. If your shares are held in joint names, you
will each receive an admission card. If you intend to bring a guest, please
print the guest's name on the line next to the admission card request box. If
your admission card should be sent to an address other than the address printed
on the card, please print that address on the line next to the admission card
request box.
PLEASE COMPLETE, SIGN AND DATE YOUR PROXY AND VOTING INSTRUCTION CARD, DETACH IT
AND RETURN IT PROMPTLY IN THE ENCLOSED REPLY ENVELOPE.
<PAGE> 30
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF PPG INDUSTRIES, INC.
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 20, 2000.
The undersigned, having received the Notice of Annual Meeting of Shareholders
and Proxy Statement, each dated March 7, 2000, hereby appoints R.W. LeBoeuf,
J.C. Diggs and M.C. Hanzel, or any of them, with full power of substitution to
each, proxies to represent the undersigned and to vote all of the shares of the
Common Stock of PPG Industries, Inc., (the "Company") that the undersigned would
be entitled to vote if personally present at the 2000 Annual Meeting of
Shareholders of the Company, or any adjournment thereof, as directed on the
reverse side hereof and in their discretion on such other matters as may
properly come before the meeting or any adjournment thereof.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED ON THE REVERSE
SIDE HEREOF. IF NO DIRECTION IS GIVEN, HOWEVER, THE SHARES REPRESENTED BY THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES FOR DIRECTOR PROPOSED BY
THE BOARD OF DIRECTORS (THOSE NOMINEES ARE STEVEN C. MASON, THOMAS J. USHER AND
DAVID R. WHITWAM). Shares to be voted FOR the election of the nominees proposed
by the Board of Directors will be voted cumulatively in the discretion of the
proxies for any nominees other than nominees with respect to whom authority to
vote FOR has been withheld. This card votes all of the shares of the Common
Stock of the Company held under the same registration in any one or more of the
following manners: as a shareholder of record; in the PPG Industries, Inc.
Dividend Reinvestment and Stock Purchase Plan; in the PPG Industries Employee
Savings Plan and in the PPG Canada Inc. Employee Savings Plan.
PLEASE COMPLETE, SIGN AND DATE THIS CARD ON THE REVERSE SIDE AND RETURN IT
PROMPTLY IN THE ENCLOSED REPLY ENVELOPE.
FOLD AND DETACH HERE
