<PAGE> 1
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
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Wellman, Inc.
(Name of Registrant as Specified In Its Charter)
Wellman, Inc.
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act
Rule 0-11 (Set forth the amount on which the filing fee is calculated and
state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
WELLMAN, INC.
1040 BROAD STREET, SUITE 302
SHREWSBURY, NEW JERSEY 07702
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 16, 1995
To the Stockholders of
Wellman, Inc.
Notice is hereby given that the Annual Meeting of the Stockholders of
Wellman, Inc. (the "Corporation") will be held at the Oyster Point Hotel, 146
Bodman Place, Red Bank, New Jersey, on Tuesday, May 16, 1995 at 10:00 A.M.,
Eastern Daylight Time, for the following purposes:
(1) To elect directors of the Corporation for the ensuing year, and
until their successors are duly elected and qualified.
(2) To ratify the selection by the Board of Directors of Ernst & Young
LLP as independent auditors to audit the Corporation's books and accounts
for the fiscal year ending December 31, 1995.
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof, including consideration of the two
stockholder proposals set forth in the accompanying proxy statement, if
such proposals are presented at the meeting.
By Order of the Board of Directors,
DAVID K. DUFFELL
Secretary
April 12, 1995
Mailed at New York, New York
PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AND MAIL IT AS PROMPTLY
AS POSSIBLE. IF YOU ATTEND THE MEETING AND VOTE IN PERSON, THE PROXY WILL NOT BE
USED.
<PAGE> 3
WELLMAN, INC.
1040 BROAD STREET, SUITE 302
SHREWSBURY, NEW JERSEY 07702
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
MAY 16, 1995
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies to be used at the Annual Meeting of Stockholders of Wellman, Inc. (the
"Corporation") to be held on May 16, 1995 and at any adjournment thereof, for
the purposes set forth in the accompanying notice of such meeting. All
stockholders of record of the Corporation's Common Stock at the close of
business on March 31, 1995 will be entitled to vote. The stock transfer books
will not be closed.
Proxies in the form enclosed are solicited on behalf of the Board of
Directors. Any stockholder giving a proxy in such form has the power to revoke
it at any time before it is exercised by filing a later proxy with the
Corporation, by attending the meeting and voting in person, or by notifying the
Corporation of the revocation in writing to its President at 1040 Broad Street,
Suite 302, Shrewsbury, New Jersey 07702. Any such proxy, if received in time for
the voting and not revoked, will be voted at the Annual Meeting in accordance
with the directions of the stockholder. Any proxy which fails to specify a
choice with respect to any matter to be acted upon will be voted for the
election of each nominee for director, in favor of Proposal 2, and against the
stockholder proposals referred to herein.
As of March 31, 1995, the Corporation had outstanding and entitled to vote
33,271,344 shares of Common Stock. Each share of such stock entitles the holder
thereof to one vote on the matters to be voted upon at the Annual Meeting with
all holders of Common Stock voting as one class. With regard to the election of
directors, votes that are withheld will be excluded entirely from the vote and
will have no effect. Abstentions may be specified on all proposals other than
the election of directors and will be counted as present for purposes of the
item on which the abstention is noted. Abstentions on the ratification of
accountants and the stockholder proposals will have the same legal effect as a
vote against such matter. Under the rules of the New York Stock Exchange,
brokers holding shares in street name have the authority to vote on certain
matters when they have not received instructions from the beneficial owners.
Brokers that do not receive instructions are entitled to vote on the election of
directors and the ratification of accountants. Broker non-votes will have no
effect on the outcome of the election of directors and the ratification of
accountants. Broker non-votes will have the same legal effect as a vote against
the stockholder proposals.
The holders of a majority of the issued and outstanding shares of Common
Stock entitled to vote, present in person or represented by proxy, shall
constitute a quorum for the transaction of business. Abstentions and broker
non-votes will be counted in determining if a quorum is present. In the absence
of a quorum, the Annual Meeting may be postponed from time to time until
stockholders holding the requisite amount are present or represented by proxy.
<PAGE> 4
<TABLE>
As of March 31, 1995, insofar as is known to the management of the
Corporation, the following persons owned beneficially more than 5% of the
outstanding Common Stock of the Corporation, the only capital stock of the
Corporation currently outstanding. Except as otherwise stated in the footnotes
below, the named persons have sole voting and investment power with regard to
the shares shown as owned by such persons.
<CAPTION>
NAME AND ADDRESS NUMBER OF SHARES PERCENT
- --------------------------------------------------------------- ----------------- -------
<S> <C> <C>
FMR Corp....................................................... 3,838,470(1) 11.6%
82 Devonshire Street
Boston, MA 02109
J.P. Morgan & Co. Incorporated................................. 3,803,870(2) 11.4%
60 Wall Street
New York, NY 10260
- ---------------
<FN>
(1) According to the joint Schedule 13G on file with the Securities and Exchange
Commission ("SEC") of FMR Corp., Edward C. Johnson 3d, Fidelity Management
& Research Company ("Fidelity") and Fidelity Magellan Fund (the "Fund"),
FMR Corp., Mr. Johnson, Fidelity and the Fund have sole voting power with
respect to 249,200, 232,100, 232,100 and 1,932,500 shares, respectively,
and FMR Corp., Mr. Johnson, Fidelity and the Fund have sole dispositive
power with respect to 3,838,470, 3,821,370, 3,606,070 and 1,932,500 shares,
respectively.
(2) According to its Schedule 13G on file with the SEC, J.P. Morgan & Co.
Incorporated has sole voting power with respect to 2,142,750 shares.
The approximate date on which the Proxy Statement and accompanying proxy
card will first be mailed to the stockholders of the Corporation is April 12,
1995.
</TABLE>
2
<PAGE> 5
ELECTION OF DIRECTORS
The persons named below have been nominated for election at the Annual
Meeting as directors of the Corporation. The directors who are elected shall
hold office until their respective successors shall have been duly elected and
qualified. In accordance with Delaware General Corporation Law, directors are
elected by a plurality of the votes of the shares present in person or
represented by proxy at the Annual Meeting.
All nominees are members of the present Board. Each of the nominees for
director has consented to being named a nominee in this Proxy Statement and has
agreed to serve as a director, if elected at the Annual Meeting. It is the
intention of the persons named in the proxy to vote for the following nominees.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AND AGE THE PAST FIVE YEARS SINCE
- ----------------------------------- --------------------------------------- ---------------
<S> <C> <C>
Thomas M. Duff, 47................. President, Chief Executive Officer and August, 1985
director of the Corporation since its
inception in 1985.
James B. Baker, 49................. Partner of River Associates, Inc. August, 1994
(private equity investment fund) since
1993. Prior to 1993, President and
Chief Operating Officer (1991-1992) and
Senior Vice President (1987-1991) of
CONSTAR International, Inc. (plastic
container manufacturer). Also a
director and chairman of the
Compensation Committee of U.S. Xpress
Enterprises, Inc.
C. William Beckwith, 63............ Vice President of the Corporation. From November, 1988
1972 until present, Chief Executive
Officer of Wellman International
Limited ("WIL").
Peter H. Conze, 74................. Retired. From 1956 until retirement in March, 1988
1983, various positions with Celanese
Corp. (a chemicals and synthetic fibers
company), including consultant from
1979 until 1983 and Vice Chairman and
director from 1970 until 1978.
Allan R. Dragone, 69............... Retired. From 1988 until 1989, Chairman August, 1990
of the Board of Fiber Industries, Inc.
From 1986 until 1990, President and
Chief Executive Officer of Akzo
America, Inc., the U.S. subsidiary of
the Dutch conglomerate Akzo N.V. Also a
director of Arcadian Chemical
Corporation, American Cyanamid, Purina
Mills Inc. and General Waterworks
Corporation.
Richard F. Heitmiller, 66.......... President of Richard F. Heitmiller, November, 1988
Inc. (consulting firm) since 1982. From
1971 until 1982, various executive
positions with Arthur D. Little, Inc.
(management consultants) and Vice
President of its Decision Resources
subsidiary.
</TABLE>
3
<PAGE> 6
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING DIRECTOR
NAME AND AGE THE PAST FIVE YEARS SINCE
- ----------------------------------- --------------------------------------- ---------------
<S> <C> <C>
Jonathan M. Nelson, 38............. Co-Chairman of Providence Ventures Inc. August, 1985
(investment advisor) since its
inception in 1990. Managing Director of
Narragansett Capital, Inc. (investment
advisor) since its inception in 1986.
Also a general partner of the general
partner of Providence Media Partners
L.P. (venture capital fund). Also a
general partner of the general partner
of Narragansett Capital Partners-A and
-B, L.P. (venture capital funds)
("NCPAB").
James E. Rogers, 49................ Partner of SCI Investors Inc. September, 1993
(investment company) since April, 1993
and Chairman of Custom Papers Group
Inc. (a paper manufacturer) since
November, 1993. From 1991 until 1992,
President and Chief Executive Officer
of Specialty Coatings International
Inc. (a manufacturer). Prior to 1991,
Senior Vice President and Group
Executive of James River Corporation (a
paper manufacturer). Mr. Rogers is also
a director and member of the
Compensation Committee of Owens &
Minor, Inc. (a medical and surgical
supplies distributor) and Caraustar
Industries, Inc. (a paper recycler).
Raymond C. Tower, 70............... Retired. From 1977 until retirement in August, 1990
1990, President and Chief Operating
Officer of FMC Corp. (a manufacturer of
machinery and chemicals). Also a
director of Morton International Inc.,
Inland Steel Industries, Inc. and
Household International, Inc.
Roger A. Vandenberg, 47............ President of Cariad Capital, Inc. August, 1985
(investment adviser) since its
inception in 1992. Managing Director of
Narragansett Capital, Inc. (investment
advisor) since its inception in 1986.
Also a general partner of the general
partner of NCPAB and a general partner
of the general partner of Narragansett
First Fund (a venture capital fund).
Mr. Vandenberg is also a director and
member of the Compensation Committee of
Monaco Coach Corporation (a
manufacturer of motor homes).
</TABLE>
4
<PAGE> 7
Although the management does not expect that any of the persons named above
will be unable to serve as a director, should any of them be unable to accept
election, it is intended that the proxies will be voted for the election of a
substitute nominee selected by the persons named in the proxy.
<TABLE>
The number of shares of the Corporation's Common Stock owned beneficially,
directly or indirectly, as of March 31, 1995 by the nominees, by the executive
officers named in the Summary Compensation Table below, and by all executive
officers and directors as a group is as follows:
<CAPTION>
AMOUNT
BENEFICIALLY PERCENTAGE OF
NAME OWNED COMMON STOCK(1)(2)
- ---------------------------------------------------------- ------------ ------------------
<S> <C> <C>
Thomas M. Duff............................................ 542,304(1) 1.6%
James B. Baker............................................ 4,300(2)(4) (3)
C. William Beckwith....................................... 131,000(1) (3)
Peter H. Conze............................................ 4,867(2) (3)
Allan R. Dragone.......................................... 6,000(2) (3)
Richard F. Heitmiller..................................... 6,000(2) (3)
Jonathan M. Nelson........................................ 8,000(2) (3)
James E. Rogers........................................... 5,000(2) (3)
Raymond C. Tower.......................................... 7,000(2) (3)
Roger A. Vandenberg....................................... 10,000(2)(5) (3)
Clifford J. Christenson................................... 115,955(1) (3)
James P. Casey............................................ 142,606(1) (3)
Paul D. Apostol........................................... 85,299(1) (3)
All Directors and Executive Officers as a Group (16
persons)................................................ 1,198,217(1)(2) 3.5%
- ------------
<FN>
(1) Includes the following shares of Common Stock reserved for issuance upon
exercise of stock options outstanding pursuant to the Wellman, Inc. Amended
and Restated 1985 Incentive Stock Option Plan: Mr. Duff, 163,000 shares;
Mr. Beckwith, 130,000 shares; Mr. Christenson, 113,000 shares; Mr. Casey,
79,000 shares; Mr. Apostol, 85,000 shares; and all directors and executive
officers as a group, 691,012 shares.
(2) Includes the following shares of Common Stock reserved for issuance upon
exercise of stock options outstanding pursuant to the Wellman, Inc.
Directors Stock Option Plan: Mr. Baker, 1,000 shares; Mr. Conze, 4,000
shares; Mr. Dragone, 4,000 shares; Mr. Heitmiller, 4,000 shares; Mr.
Nelson, 4,000 shares; Mr. Rogers, 2,000 shares; Mr. Tower, 4,000 shares;
Mr. Vandenberg, 4,000 shares; and all directors and executive officers as a
group, 27,000 shares.
(3) Less than 1%.
(4) Includes 200 shares owned by Mr. Baker's wife.
(5) Includes 4,000 shares owned by Mr. Vandenberg, 1,000 shares held by a trust
for the benefit of his two children and 1,000 shares owned by his wife as
custodian for their two children.
</TABLE>
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors has a Compensation Committee, currently comprised of
Messrs. Dragone, Nelson (Chairperson) and Rogers, which is responsible for
reviewing certain of the Corporation's compensation programs and making
recommendations to the Board of Directors with respect to compensation. The
Compensation Committee met twice during the Corporation's last fiscal year.
The Board of Directors has a Finance and Audit Committee, currently
comprised of Messrs. Baker, Conze, Heitmiller and Vandenberg (Chairperson),
which is responsible for reviewing the Corporation's
5
<PAGE> 8
internal auditing procedures and accounting controls and considering the
selection and independence of the Corporation's outside auditors. The Finance
and Audit Committee met three times during the Corporation's last fiscal year.
The Board of Directors has a Nominating Committee, currently comprised of
Messrs. Conze, Heitmiller (Chairperson) and Tower, which is responsible for
considering the qualifications and recommending to the stockholders the election
of directors of the Corporation. Stockholders may recommend nominees for
election as directors by writing to the President of the Corporation. The
Nominating Committee met once during the Corporation's last fiscal year.
The Corporation's Board of Directors held a total of six meetings during
1994. Each member of the Board of Directors attended at least 75% of the
aggregate number of meetings of the Board and all committees on which he served,
except Mr. Beckwith who attended four of the six meetings.
COMPENSATION OF DIRECTORS AND OFFICERS
DIRECTORS COMPENSATION
Each director of the Corporation who is not an employee receives fees of
$24,000 per year, plus $1,500 for each Board or Committee meeting attended in
person and $750 for each telephonic meeting attended. Directors who are
employees receive no additional compensation for serving as directors or
attending Board or Committee meetings.
The Corporation maintains a Restricted Stock Plan pursuant to which each
non-employee director of the Corporation is eligible to receive a total of 2,000
shares of the Corporation's Common Stock which vest over a period of three years
commencing on the date he was first elected to the Board, provided he has
continuously served as a director for the preceding twelve months.
The Corporation also maintains a Directors Stock Option Plan pursuant to
which each non-employee director of the Corporation is eligible to receive
annually options to acquire 1,000 shares of the Corporation's Common Stock.
On an annual basis, each non-employee director is eligible to participate
in the Directors' Deferred Compensation Plan which allows the deferral of all or
a portion of directors compensation (excluding expense reimbursement) payable
from time to time. Messrs. Baker, Nelson and Vandenberg have elected to defer
their compensation for 1995. Directors participating in this Plan may elect to
have the deferred compensation invested in an interest-bearing account, a share
equivalent account representing the Corporation's Common Stock, or a combination
of the two. The interest-bearing account accrues interest at the rate equal to
the total return earned by the Lehman Aggregate Bond Index. Deferred
compensation in the share equivalent account is treated as though it were
invested in Common Stock. If a participant makes a share election, dividend
equivalents accrue to a participant's account quarterly and each account is
adjusted to reflect share ownership changes resulting from events such as a
stock split. Participants have no voting rights with respect to the share
equivalent account. All distributions from accounts are made in cash.
In addition, upon voluntary retirement from the Board of Directors,
non-employee directors who have served as directors for three or more years are
entitled to receive total retirement payments equal to the annual directors fee
in effect at the date of retirement multiplied by the number of full years of
continuous service as a director of the Corporation.
6
<PAGE> 9
<TABLE>
EXECUTIVE COMPENSATION
The following table summarizes the compensation for the years ended
December 31, 1994, 1993 and 1992 of the Corporation's chief executive officer
and the four other most highly compensated executive officers whose salary and
bonus exceeded $100,000.
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------ ------------
OTHER SECURITIES ALL
ANNUAL UNDERLYING OTHER
COMPEN- OPTIONS/ COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS SATION(1) SARS(2) SATION(3)
- ------------------------------------- ---- -------- -------- ------- ------------ --------
<S> <C> <C> <C> <C> <C> <C>
Thomas M. Duff....................... 1994 $605,000 $462,449 $54,453 30,000 $159,634
President, CEO 1993 $560,000 $203,218 $47,960 30,000 $128,260
1992 $500,000 $357,500 $43,819 30,000 $ 30,000
C.W. Beckwith........................ 1994 $274,075 $166,170 $17,750 15,000 --
Vice President; 1993 $259,857 $ 92,159 $15,911 15,000 --
CEO, WIL 1992 $249,392 $150,000 $18,621 20,000 --
Clifford J. Christenson.............. 1994 $280,000 $214,026 $27,270 25,000 $ 72,661
Executive Vice President 1993 $265,000 $ 96,166 $31,911(4) 25,000 $ 59,307
1992 $240,000 $171,600 $13,973 20,000 $ 30,000
James P. Casey....................... 1994 $237,501 $119,682 $24,607 20,000 $ 66,902
Vice President; 1993 $215,004 $109,839 $21,482 20,000 $ 47,621
President, Fibers Division 1992 $207,500 $154,960 $20,710 15,000 $ 30,000
Paul D. Apostol...................... 1994 $211,250 $187,825 $22,225 15,000 $ 57,306
Vice President, 1993 $196,875 $ 88,644 $24,627 15,000 $ 42,434
Manufactured 1992 $184,375 $ 99,130 $15,322 15,000 $ 30,000
Products Group
- ------------
<FN>
(1) Includes the Corporation's contributions to life insurance premiums or
payments in lieu thereof (Mr. Duff, $54,453; Mr. Beckwith, $17,750; Mr.
Christenson, $27,270; Mr. Casey, $24,607; and Mr. Apostol, $22,225 in
1994).
(2) None of the options granted were options with tandem SARs and no
free-standing SARs were granted.
(3) Consists of the Corporation's contributions to employee retirement (Mr.
Duff, $20,480; Mr. Beckwith,
$-0-; Mr. Christenson, $20,480; Mr. Casey, $20,480; and Mr. Apostol,
$20,480 in 1994), supplemental retirement (Mr. Duff, $134,654; Mr.
Beckwith, $-0-; Mr. Christenson, $47,681; Mr. Casey, $41,922; and Mr.
Apostol, $32,326 in 1994), and savings plans (Mr. Duff, $4,500; Mr.
Beckwith, $-0-; Mr. Christenson, $4,500; Mr. Casey, $4,500; and Mr.
Apostol, $4,500 in 1994).
(4) Includes $10,800 payment made to Mr. Christenson upon exercise of options
converted into non-qualified options as compensation for taxes payable.
</TABLE>
7
<PAGE> 10
<TABLE>
The following table sets forth certain information relating to option
grants pursuant to the Corporation's 1985 Incentive Stock Option Plan (the
"Option Plan") in the year ended December 31, 1994 to the individuals named in
the Summary Compensation Table above.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------
% OF
NUMBER OF TOTAL
SECURITIES OPTIONS/SARS EXERCISE
UNDERLYING GRANTED TO OR
OPTIONS/ EMPLOYEES BASE EXPIRA- GRANT
SARS IN FISCAL PRICE TION DATE
NAME GRANTED(1)(2) YEAR ($/SH) DATE VALUE(3)
- ---------------------------------- ------------- ------------ ------ --------- --------
<S> <C> <C> <C> <C> <C>
Thomas M. Duff.................... 30,000 7.6 $29.25 12/21/05 $483,503
C.W. Beckwith..................... 15,000 3.8 $29.25 12/21/05 $241,751
Clifford J. Christenson........... 25,000 6.4 $29.25 12/21/05 $402,919
James P. Casey.................... 20,000 5.1 $29.25 12/21/05 $322,335
Paul D. Apostol................... 15,000 3.8 $29.25 12/21/05 $241,751
- ------------
<FN>
(1) None of the options granted were options with tandem SARs and no
free-standing SARs were granted.
(2) All options granted to the named executive officers were granted on December
21, 1994 pursuant to the Option Plan. The options become exercisable in 20%
increments on December 21, 1995, 1996, 1997, 1998 and 1999, respectively.
If a Change of Control (as defined in the Option Plan) occurs, these
options would become immediately exercisable.
(3) Based on the Black-Scholes option pricing model. The Corporation's use of
this model should not be construed as an endorsement of its accuracy at
valuing options. The actual value, if any, an executive may realize will
depend on the excess of the stock price over the exercise price on the date
the option is exercised, so that there is no assurance the value realized
by an executive will be at or near the value estimated by the Black-Scholes
model. The estimated values under that model are based on the following
assumptions:
</TABLE>
<TABLE>
<S> <C>
Stock price..................................................... $29.25
Exercise price.................................................. $29.25
Expected option term............................................ 10 years
Stock price volatility.......................................... .3374
Dividend yield.................................................. .78%
Risk-free interest rate......................................... 7.5%
</TABLE>
8
<PAGE> 11
<TABLE>
The following table sets forth certain information with respect to option
exercises in 1994 and unexercised options to purchase the Corporation's Common
Stock granted under the Option Plan to the individuals named in the Summary
Compensation Table above.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FY-END FY-END(1)
SHARES ACQUIRED VALUE -------------------------- --------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------- --------------- ---------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Thomas M. Duff......... 92,000 $1,072,625 59,000 104,000 $ 319,250 $ 690,250
C.W. Beckwith.......... -0- -0- 78,000 52,000 $ 734,125 $ 340,875
Clifford J.
Christenson.......... 27,000 $ 322,050 43,000 70,000 $ 274,000 $ 427,875
James P. Casey......... 16,000 $ 177,750 27,000 52,000 $ 114,250 $ 307,250
Paul D. Apostol........ -0- -0- 42,000 43,000 $ 255,125 $ 263,750
- ---------------
<FN>
(1) Based on the closing price on the New York Stock Exchange of the
Corporation's Common Stock on December 30, 1994 ($28.25).
</TABLE>
Pension Plan. The Corporation's subsidiary, Fiber Industries, Inc.
("FII"), maintains the Fiber Industries, Inc. Retirement Income Plan (the
"Pension Plan"), a tax-qualified defined benefit pension plan for eligible
employees of FII, which included Messrs. Casey and Apostol. Effective July 1,
1991, no additional employees became Participants in the Pension Plan.
Participants are entitled to a monthly retirement benefit if they retire
(i) at or after age 65 (normal retirement age) or (ii) at or after age 55 with
either five or ten years of vesting service depending on whether they retire
directly from employment with FII or are transferred Celanese employees.
Participants whose employment with FII terminates after five years of vesting
service will also be eligible for a monthly retirement benefit. If benefits are
paid prior to normal retirement age they may be reduced, depending on the date
benefits begin and the Participant's age and service.
A Participant's normal retirement benefit is calculated under a formula
which takes into consideration final average compensation, years of service up
to 35, and benefits to be derived through Social Security and certain employee
benefit plans. Final average compensation covered by the Pension Plan is based
on the combined amounts set forth under the headings "Salary" and "Bonus" of the
Summary Compensation Table for Messrs. Casey and Apostol.
Benefits, computed on the basis of a straight life annuity, are payable
upon early, normal and late retirement, and upon death of a Participant with at
least five years of service. If benefits are paid in a form other than a
straight life annuity to the Participant, they are adjusted actuarially to
reflect the features of such other form.
9
<PAGE> 12
The following table illustrates the estimated annual normal retirement
benefits payable under the Pension Plan. These benefit levels assume an
employee's retirement at age 65 during 1994 and payment in the form of a single
life annuity.
<TABLE>
<CAPTION>
YEARS OF SERVICE
AVERAGE ---------------------------------------------------
EARNINGS 15 20 25 30 35
- -------- ------ ------ ------ ------ -------
<S> <C> <C> <C> <C> <C>
$125,000 21,134 30,554 39,974 49,394 58,814
$150,000 24,792 35,922 47,051 58,181 69,311
$175,000 28,099 40,644 53,189 65,733 78,278
$200,000 32,104 46,476 60,849 75,222 89,595
$225,000 36,109 52,309 68,510 84,710 100,911
$250,000 39,088 56,583 74,079 91,575 109,070
$275,000 39,088 56,583 74,079 91,575 109,070
$300,000 39,088 56,583 74,079 91,575 109,070
$400,000 39,088 56,583 74,079 91,575 109,070
$450,000 39,088 56,583 74,079 91,575 109,070
$500,000 39,088 56,583 74,079 91,575 109,070
$600,000 39,088 56,583 74,079 91,575 109,070
$700,000 39,088 56,583 74,079 91,575 109,070
</TABLE>
Notwithstanding the above table, benefits under the Pension Plan may not
exceed certain limits imposed by the Internal Revenue Code (the "Code"). The
maximum benefit payable in 1994 is $118,800. The table incorporates the Code
limitations on compensation allowable under a qualified pension plan. The limit
on compensation allowable in 1994 is $150,000. In addition, the above estimated
benefits are subject to limitations for employees who also participate in the
Wellman, Inc. Retirement Plan and the Wellman, Inc. Employee Stock Ownership
Plan. The estimated credited years of service under the Pension Plan for Messrs.
Casey and Apostol are 26 and 24 years, respectively.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
The Compensation Committee of the Board of Directors of the Corporation
(the "Committee"), which is composed entirely of non-employee directors, met
twice during fiscal 1994. The Committee has responsibility for administering the
Corporation's annual Management Incentive Compensation and 1985 Incentive Stock
Option Plans. The Committee is also responsible for making compensation
recommendations to the Board with respect to the five executive officers whose
fiscal 1994 compensation is disclosed on the Summary Compensation Table on page
7 of this proxy statement. In this capacity, the Committee determines the
salary, management incentive plan awards and stock option grants for those
executive officers, following administrative policies and practices which it
establishes from time to time in accordance with the terms and provisions of the
plans. This Committee Report describes the Corporation's officer compensation
program strategy, the components of the compensation program, and the manner in
which 1994 compensation determinations were made by the Committee with respect
to the President and Chief Executive Officer, Mr. Thomas M. Duff. Similar
determinations were made by the Committee with respect to the other four
executive officers, based on recommendations submitted by Mr. Duff.
Compensation Strategy. The Committee endeavors to maintain an officer
compensation program which is competitive with the practices of public
corporations of similar revenue size. The Committee believes a substantial
component of executive officer total compensation should be based on the
Corporation's profitability and on the increase in market value of its
stockholders' investment. The Management Incentive Plan compensates executive
officers commensurate with the Corporation's annual growth and profitability,
and
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<PAGE> 13
annual stock option grants ensure that their longer-term incentive compensation
is directly related to increases in the market value of the Corporation's stock.
The remainder of this Committee Report describes the components of the
Corporation's officer compensation program and the manner in which these were
administered in fiscal 1994.
Base Salary. Base salary forms the competitive foundation of the officer
compensation program. Executive officer salaries are administered by the
Committee so as to ensure they remain competitive with practices of companies of
comparable revenue size. The Committee has periodically engaged compensation
consultants to survey market practices to ensure executive officer salaries
remain competitive in a manner which properly reflects the performance of the
incumbent officers. Such surveys have included the practices of some, but by no
means all, of the companies included in the peer group shown on the Stock
Performance Graph.
Mr. Duff's salary has not been adjusted by the Committee since November
1993. In approving salary increase recommendations submitted by Mr. Duff with
respect to the other executive officers, the Committee took into account their
existing salaries in relation to competitive salary data furnished by the
Company's compensation consultant and its subjective evaluation of each
officer's performance. Mr. Duff's 1994 annual salary falls within the fourth
quartile (above the 75th percentile) of competitive practice for corporations
with revenues of comparable size. The average 1994 salaries of the other
executive officers fall within the third quartile (between the 50th and 75th
percentiles) of competitive practice for their peers in corporations with
revenues of comparable size.
Management Incentive Plan. The Management Incentive Plan ("MIP") was first
implemented in 1992. Annual bonuses earned by the executive officers, and other
plan participants, are directly related to, and based upon, corporate (and for
operating executives, their operating unit's) profit growth. Under the terms of
the MIP, profit is defined as operating profit less a capital charge based on
the net assets employed to generate these profits. The plan pays awards based on
growth in annual profits. Unless profits exceed a base level established at the
start of the year, no MIP awards are paid. The base level established for 1994
was exceeded. The base profit level increases each year reflecting the profit
growth of the business to ensure that bonuses are directly related to
incremental profit growth -- i.e., the added value created for the Corporation's
stockholders. The maximum MIP award which may be paid is 1.5x target levels.
Payment of any awards earned in excess of this amount is deferred.
Mr. Duff's target MIP award is 50% of base salary; the target awards for
the other executive officers range from 30% to 50%. All of the executive
officers named in the Summary Compensation Table achieved their targeted MIP
award.
For fiscal 1994, the Committee recommended the payment of an annual bonus
of $462,449 for Mr. Duff, which was consistent with the Corporation's
profitability and the terms of the MIP.
Stock Options. Annual stock option grants represent the third component of
the Corporation's officer compensation program. Stock option grants permit
optionees to share in the future growth in market value of the Corporation's
common stock by allowing them to purchase shares of stock for a period up to ten
years following date of grant at a price equal to the price of a share of common
stock on the date the options were granted. To ensure stock options provide a
longer-term stockholder value-based incentive, 20% of the options granted in a
year become exercisable (i.e., the optionee can purchase the option shares) on
the first through fifth anniversaries of the grant date, provided the optionee
remains an employee of the Corporation.
The Chief Executive Officer of the Corporation submits proposed stock
option grants for the executive officers (other than himself) to the Committee
for approval. In making the final determination of option grants, the Committee
considers the individual executive's scope of responsibility, individual
performance, the
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<PAGE> 14
levels of profits and return on assets of the Corporation and of its operating
divisions (with no specific target levels being established), competitive levels
of option grants, and the aggregate number of options awarded to the executive
to date. The Committee, in its discretion, assigns relative weights to these
factors as it deems appropriate.
The Option Grants Table on page 8 of this proxy statement shows the terms
and size of 1994 stock option grants made to the executive officers named in the
Summary Compensation Table. The Committee and the Board approved the grant of
these options effective December 21, 1994. These grants fall within the third
quartile of competitive practice for Mr. Duff, and the average grants for the
other executive officers fell within the fourth quartile of competitive practice
for corporations of comparable revenue size.
The values shown under the "Grant Date Value" column of this table
represent an estimate of the potential value of these grants. These projections
should not be construed as a forecast of future stock price or the compensation
that will be realized from the actual exercise of these option share grants.
Unless the future price of the Corporation's stock is higher than $29.25 per
share, the price at the time the 1994 options were granted, these options will
have no value.
The table on page 9 of this proxy statement entitled "Aggregated Option/SAR
Exercises in Last Fiscal Year and FY-End Option/SAR Values" shows the total
number of exercisable and unexercisable options which each executive officer was
granted as of December 31, 1994 and the appreciated value of these grants based
on the market price of the Corporation's common stock on that date. The
Committee believes it is important for the executive officers to have a
significant incentive based on increases in the market value of the Corporation.
The option grants shown on the table reflect actions taken by the Committee and
the Board of Directors, which are fully consistent with this intention and the
compensation strategy previously described in this Committee Report.
The Committee believes that the Corporation's compensation programs are in
conformity with the IRS definitions of performance-based compensation to assure
full deductibility of the executive's compensation.
This report has been provided by the Compensation Committee.
Jonathan M. Nelson (Chairperson)
Allan R. Dragone
James E. Rogers
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<PAGE> 15
FIVE-YEAR PERFORMANCE COMPARISON
The following graph compares the five-year cumulative total return for the
Corporation's stock with the Standard & Poor's ("S&P") 500 Stock Index and the
S&P Midcap 400 Index. Due to the unique nature of its operations, the
Corporation believes there exists no appropriate or comparable line of business
or industry index, nor could one be constructed, which would render a meaningful
or accurate performance comparison. The Corporation has derived an average of
approximately 80% of its total sales over the last three years from the sale of
man-made fibers, primarily polyester. The Corporation believes that the
polyester fiber manufacturing operations of its major publicly-owned
competitors, if such operations could be analyzed separately, would not
represent as significant a proportion of their sales or operations. Further, the
Corporation, which is the world's largest plastics recycler, believes it is the
only major polyester fiber producer to utilize a significant amount of recycled
raw materials in its manufacturing operations.
<TABLE>
<CAPTION>
Measurement Period S&P Mid-Cap
(Fiscal Year Covered) Wellman, Inc. S&P 500 400
<S> <C> <C> <C>
1989 100.00 100.00 100.00
1990 51.17 96.89 94.88
1991 64.73 126.42 142.42
1992 61.80 136.05 159.38
1993 54.71 149.76 181.62
1994 83.91 151.74 175.11
The above graph assumes $100 invested on December 31, 1989 in the
Corporation's stock and $100 invested at that time in each of the two indices.
The comparison assumes that all dividends are reinvested.
</TABLE>
EMPLOYMENT CONTRACTS
The Corporation has entered into change of control employment agreements
with five key executives, including Messrs. Duff, Christenson, Casey and
Apostol. These agreements are intended to encourage such executives to remain in
the employ of the Corporation by providing them with greater security and to
reinforce and encourage continued attention and dedication to their duties
without distraction in the face of the potentially disturbing circumstances
arising from the possibility of a change in control. A change of control is
defined to include the acquisition by any person or group of 20% or more of the
Corporation's then outstanding
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<PAGE> 16
stock, a change in the majority of the Corporation's Board of Directors or
approval of a reorganization, merger or consolidation by the Corporation's
stockholders.
The employment agreements (which include provisions for renewal and for
automatic extension upon a change of control) provide for employment as officers
of the Corporation at base salaries determined by the Board of Directors, plus
participation in the Corporation's executive bonus plan. Provided there has been
no change in control, the employment agreements of the executives other than Mr.
Duff provide the executive's employment may be terminated upon 30 days notice.
In addition, the executives are eligible to participate in all incentive,
savings, retirement and welfare benefit plans applicable to other Corporation
executives and shall receive reimbursement for expenses and automobiles. The
agreements provide that if the executive is terminated after a change of
control, other than for cause, death or disability, or if the executive
terminates for good reason (as defined in the agreements), the executive is
entitled to receive his salary and bonus through the date of termination and a
lump sum severance payment equal to three times the sum of his base salary and
annual bonus (and certain other benefits). Further, an additional payment is
required in an amount such that after the payment of all taxes, income and
excise, the executive will be in the same after-tax position as if no excise tax
under Section 4999 of the Code had been imposed.
Wellman International Investments Limited ("WIIL"), a subsidiary of the
Corporation, is a party to a multi-year employment contract with Mr. Beckwith
which expires on December 31, 1996. Under the agreement, Mr. Beckwith's annual
base salary is L110,000, which is subject to increase from time to time as
agreed upon by the parties. The parties increased Mr. Beckwith's salary to
L174,000 (approximately $268,000) in 1994 and L179,000 (approximately $276,000)
in 1995. WIIL may terminate the agreement at any time for cause or in the event
of Mr. Beckwith's incapacity for a continuous period of 364 days or a total of
364 days (including Saturdays and holidays) in any 24 month period. The
agreement contains a covenant not to compete restricting Mr. Beckwith from
competing with the Corporation or any of its subsidiaries in the United Kingdom
or Ireland for a period of six months.
OTHER INFORMATION
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's officers and directors, and persons who own more than 10% of a
registered class of the Corporation's equity securities ("insiders"), to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). Insiders are required by SEC regulation to furnish the
Corporation with copies of all Section 16(a) forms they file. Based solely on
review of the copies of such forms furnished to the Corporation, the Corporation
believes that during 1994 all Section 16(a) filing requirements applicable to
its insiders were complied with, except that Richard J. Kattar, who retired
April 1, 1995, inadvertently failed to timely file one report relating to one
transaction.
Mr. Vandenberg is the President and a director of Glasstech Industries,
Inc. ("Glasstech"), a portfolio company of NCPAB, and a director and vice
chairman of Glasstech's operating company subsidiary. Glasstech filed for
protection under federal bankruptcy laws in 1993 and emerged from bankruptcy in
January 1995.
RATIFICATION OF SELECTION OF AUDITORS
The selection, by a majority of the members of the Board who are not
officers or employees of the Corporation, of Ernst & Young LLP as independent
auditors to audit the books and accounts of the Corporation for the fiscal year
ending December 31, 1995 shall be submitted to the Annual Meeting for
ratification. Such ratification requires the affirmative vote of a majority of
the shares entitled to vote thereon
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<PAGE> 17
present in person or represented by proxy at the Annual Meeting when a quorum is
present. Representatives of Ernst & Young LLP will be present at the Annual
Meeting and will be given an opportunity to make a statement if they desire to
do so and will respond to appropriate questions of stockholders.
The firm of Ernst & Young LLP has advised the Corporation that neither it
nor any of its members has any direct financial interest in the Corporation as a
promoter, underwriter, voting trustee, director, officer or employee.
All professional services rendered by Ernst & Young LLP during the year
ended December 31, 1994 were furnished at customary rates.
The Board recommends a vote FOR ratification of Ernst & Young LLP as
independent auditors for the fiscal year ending December 31, 1995.
STOCKHOLDER PROPOSALS
STOCKHOLDER PROPOSAL NO. 1
Local 2398, Amalgamated Clothing and Textile Workers Union ("ACTWU"), P.O.
Box 1073, Johnsonville, South Carolina, the beneficial owner of 200 shares of
Common Stock, has advised the Corporation that it intends to introduce the
following resolution (the "Union Proposal") at the Corporation's 1995 Annual
Meeting for the reasons given:
RESOLVED: That the shareholders of Wellman, Inc. ("Company") hereby amend
Section 2.11 of the Company's by-laws to read in its entirety as
follows:
Notwithstanding Section 2.07(e) of these By-Laws, at all
meetings of stockholders, any matter properly brought
before the meeting by a stockholder shall be decided by the
vote of a majority of total quorum. For the purposes of the
foregoing, a broker non-vote on such a matter shall not be
counted as part of the quorum or as a vote either "for" or
"against" the matter; an abstention from voting on such a
matter shall have the same legal effect as a vote "against"
the matter. This Section 2.11 may be amended or repealed
only with the approval of the stockholders.
SUPPORTING STATEMENT
This proposal, which would amend the Company's by-laws, is being submitted
in response to our Company's reliance on a vote counting method which has had
the effect of preventing shareholder action which is not to management's liking.
For the last three years, shareholders have voted on a stockholder proposal
which asked the Company to redeem or put to a vote the shareholder rights plan,
or "poison pill." The last two years, a majority of shareholders present have
voted to approve the stockholder proposal at rates of approximately 53% and 54%
respectively. The Company has chosen to ignore the clearly expressed desire on
the part of shareholders to have a voice in the Company's adoption of its poison
pill. The Company's vote counting method has further allowed the Company to
obfuscate the fact that it is disregarding the wishes of a majority of its
voting shareholders.
Under the Company's current vote counting procedures, the Company applies a
special policy to matters brought by stockholders, such as the proposal on the
Company's poison pill, whereby the Company counts broker non-votes as votes
"against" the proposal. Broker non-votes are cases in which brokers have
submitted proxies on behalf of beneficial owners who have not given the broker
the authority to vote on that particular matter.
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<PAGE> 18
Besides denying the passage of stockholder proposals which receive a
majority of shareholder votes, the Company's current practice establishes higher
requirements for stockholder action, and only for matters presented by
stockholders, than those contemplated under applicable law. Under Delaware
corporation law, unless the charter or by-laws of a company provide otherwise, a
majority of the votes of stockholders present and entitled to vote is sufficient
to determine the outcome of matters put before shareholders, and Delaware case
law has in that situation interpreted broker non-votes as neither present nor
entitled to vote.
We believe the Company's current method of counting votes is designed to,
and has the effect of, inhibiting shareholder action, and should be changed. We
urge shareholders to support this amendment to revise the Company's vote
counting procedures to ensure they provide the maximum shareholder rights
available under law on all shareholder matters whether the Board prefers passage
of those matters or not.
BOARD RECOMMENDATION
THE BOARD OPPOSES THE UNION PROPOSAL AND RECOMMENDS A VOTE AGAINST IT.
Section 2.11 of the Corporation's by-laws as it currently exists is
entirely proper and consistent with applicable law and, in the view of the
Board, should not be changed. It provides for the passage of shareholder
proposals that receive the vote of a majority of shares present and entitled to
vote at the meeting. The Union Proposal, on the other hand, would enable a
minority of stockholders, conceivably owning as little as 25% of the outstanding
shares, to effect changes that could be contrary to the best interests of a
majority of the Corporation's stockholders.
Under both the current version of the Corporation's by-laws and the Union
Proposal, Section 2.11 requires that a shareholder proposal receive the vote of
a "majority of the total quorum" for passage. Under the current version of
Section 2.11, "total quorum" is defined to include broker non-votes and
abstentions; the Union Proposal, however, defines "total quorum" to exclude
broker non-votes.
Broker non-votes result when a broker holding stock in street name votes
the shares on some matters under consideration at a shareholder meeting but not
all of them. This occurs because brokers are entitled to vote on "routine"
proposals but must receive voting instructions from their clients on non-routine
proposals. The missing votes on the non-routine matters are "broker non-votes".
Broker non-votes, as well as abstentions, are counted for purposes of
determining whether a quorum is present at a meeting. However, in determining
whether a particular proposal receives the requisite vote, the treatment of
broker non-votes varies depending on the state of incorporation and any special
charter or by-law provisions. The Corporation's vote counting procedure
specified in Section 2.11 of its by-laws follows the approach of requiring the
approval of at least a majority of the total quorum (defined to include both
abstentions and broker non-votes) to pass a shareholder proposal, thereby giving
both broker non-votes and abstentions the effect of "against" votes.
For the foregoing reasons, the Board recommends that the stockholders vote
AGAINST the adoption of the Union Proposal.
The affirmative vote of a majority of the total quorum (as such term is
currently defined in Section 2.11 of the Corporation's by-laws) is necessary to
adopt the Union Proposal. Unless otherwise indicated, the persons named on the
proxy will vote all proxies AGAINST the Union Proposal.
STOCKHOLDER PROPOSAL NO. 2.
William Steiner, 4 Radcliff Drive, Great Neck, New York, the beneficial
owner of the Corporation's Common Stock having a market value of at least
$1,000, has advised the Corporation that he intends to
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<PAGE> 19
introduce the following resolution (the "Steiner Proposal") at the Corporation's
1995 Annual Meeting for the reasons given:
RESOLVED, that the shareholders assembled in person and by proxy, recommend
(i) that all future non-employee directors not be granted pension benefits
and (ii) current non-employee directors voluntarily relinquish their
pension benefits.
SUPPORTING STATEMENT
Aside from the usual reasons, presented in the past, regarding "double
dipping", that is outside (non-employee) directors who are in almost all cases
amply rewarded with their pension at their primary place of employment, and in
many instances serving as outside pensioned directors with other companies,
there are other more cogent reasons that render this policy as unacceptable.
Traditionally, pensions have been granted in both the private and public
sectors for long term service. The service component usually represents a
significant number of hours per week. The practice of offering pensions for
consultants is a rarity. Outside directors' service could logically fit the
definition of consultants and pensions for this type of service is an abuse of
the term.
But more importantly, outside directors, although retained by corporate
management, namely the C.E.O., are in reality representatives of shareholders.
Their purpose is to serve as an impartial group to which management is
accountable. Although outside directors are certainly entitled to compensation
for their time and expertise, pensions have the pernicious effect of comprising
their impartiality. In essence, pensions are management's grants to outside
directors to insure their unquestioning loyalty and acquiescence to whatever
policy management initiates, and at times, serving their own self interests.
Thus, pensions become another device to enhance and entrench management's
controls over corporate policies while being accountable only to themselves. As
a founding member of the Investors Rights Association of America I feel this
practice perpetuates a culture of corporate management "cronyism" that can
easily be at odds with shareholder and company interest.
A final note in rebuttal to management's contention that many companies
offer their outside directors pensions, so they can attract and retain persons
of the highest quality. Since there are also companies that do not offer their
outside directors pensions, can management demonstrate that those companies that
offer pensions have a better performance record than their non-pensioned peers?
In addition, do we have any evidence of a significant improvement in corporate
profitability with the advent of pensions for outside directors?
I URGE YOUR SUPPORT, VOTE FOR THIS RESOLUTION.
----------------------------------------------
BOARD RECOMMENDATION
THE BOARD STRONGLY OPPOSES THE STEINER PROPOSAL AND RECOMMENDS A VOTE
AGAINST IT.
Retirement plans for non-employee directors are quite prevalent among
public corporations. Pension benefits such as those given to the Corporation's
non-employee directors must be viewed as a part of a director's total overall
compensation. It is by offering directors a compensation package comparable to
that offered by top industrial companies that the Corporation can attract and
retain directors of the highest quality. How that total compensation breaks down
among its component parts (e.g., annual retainer, meeting fees, retirement
benefits, etc.) is, in the Corporation's view, of little significance.
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<PAGE> 20
In light of the significant duties and responsibilities of the
Corporation's outside Directors, the Corporation believes that its total
compensation package for non-employee Directors, which includes the retirement
plan, is appropriate and fair.
For the foregoing reasons, the Board recommends that the stockholders vote
AGAINST the adoption of the Steiner Proposal.
The affirmative vote of a majority of the total quorum (as such term is
defined in Section 2.11 of the Corporation's by-laws) is necessary to adopt the
Steiner Proposal. Unless otherwise indicated, the persons named on the proxy
will vote all proxies AGAINST the Steiner Proposal.
OTHER MATTERS
Management does not know of any matters which will be brought before the
Annual Meeting other than those specified in the notice thereof. However, if any
other matters properly come before the Annual Meeting, it is intended that the
persons named in the form of proxy, or their substitutes acting thereunder, will
vote therein in accordance with their best judgment.
FINANCIAL STATEMENTS
The financial statements of the Corporation are contained in the 1994
Annual Report to Stockholders, which has been provided to the stockholders
concurrently herewith. Such report and the financial statements contained
therein are not to be considered as a part of this soliciting material.
STOCKHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
Under the regulations of the Securities and Exchange Commission, a record
or beneficial owner of shares of the Corporation's Common Stock may submit
proposals on proper subjects for action at the 1996 Annual Meeting of
Stockholders of the Corporation. All such proposals must be mailed to the
Corporation at 1040 Broad Street, Suite 302, Shrewsbury, New Jersey 07702 and
must be received at that address on or before December 13, 1995, in order to be
included in the Corporation's proxy relating to the 1996 Annual Meeting.
EXPENSE OF SOLICITATION OF PROXIES
All the expenses of preparing, assembling, printing and mailing the
material used in the solicitation of proxies by the Board will be paid by the
Corporation. In addition to the solicitation of proxies by use of the mails,
officers and regular employees of the Corporation may solicit proxies on behalf
of the Board by telephone, telegram or personal interview, the expenses of which
will be borne by the Corporation. Arrangements may also be made with brokerage
houses and other custodians, nominees and fiduciaries to forward soliciting
materials to the beneficial owners of stock held of record by such persons at
the expense of the Corporation. The Corporation has retained Georgeson & Co. to
assist in this solicitation at an estimated cost of $15,000 which will be borne
by the Corporation.
By order of the Board of Directors,
DAVID K. DUFFELL
Secretary
New York, New York
April 12, 1995
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<PAGE> 21
WELLMAN, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF THE CORPORATION FOR ANNUAL MEETING MAY 16, 1995
The undersigned hereby appoints THOMAS M. DUFF, CLIFFORD J. CHRISTENSON and
DAVID K. DUFFELL, or any one or more of them, attorneys, with full power of
substitution to each for and in the name of the undersigned, with all powers the
undersigned would possess if personally present to vote the Common Stock of the
Undersigned in Wellman, Inc. at the Annual Meeting of its Stockholders to be
held May 16, 1995 or at any adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU INSTRUCT THE PROXIES TO VOTE FOR
PROPOSALS 1 AND 2.
1. Election of Directors:
FOR all nominees (except as WITHHOLD AUTHORITY to vote
marked to the contrary below) / / for all nominees listed below / /
JAMES B. BAKER C. WILLIAM BECKWITH PETER H. CONZE ALLAN R. DRAGONE
THOMAS M. DUFF RICHARD F. HEITMILLER JONATHAN M. NELSON
JAMES E. ROGERS RAYMOND C. TOWER ROGER A. VANDENBERG
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE
WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.)
- --------------------------------------------------------------------------------
2. Proposal to ratify the selection of Ernst & Young LLP as independent
auditors of the Corporation for the fiscal year ending December 31, 1995.
FOR / / AGAINST / / ABSTAIN / /
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU INSTRUCT THE PROXIES TO VOTE AGAINST
PROPOSALS 3 AND 4.
3. Stockholder proposal to amend the By-Laws.
4. Stockholder proposal to recommend that non-employee directors not be
granted pension benefits.
FOR / / AGAINST / / ABSTAIN / /
FOR / / AGAINST / / ABSTAIN / /
(Continued and to be signed on the other side)
(Continued from other side)
5. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment
thereof.
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE
BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO
VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS. THE
PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE,
THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2 AND AGAINST PROPOSALS 3
AND 4.
Dated: .................., 1995
...............................
...............................
SIGNATURE(S)
NOTE: JOINT OWNERS SHOULD EACH
SIGN. WHEN SIGNING AS ATTORNEY,
EXECUTOR, ADMINISTRATOR, TRUSTEE
OR GUARDIAN, PLEASE GIVE FULL
TITLE AS SUCH.
PLEASE SIGN EXACTLY AS NAME APPEARS HEREON.
