<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
FMC GOLD COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
FMC GOLD COMPANY
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
FMC GOLD COMPANY LOGO
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Reno,
Nevada
March 20, 1995
To the Stockholders:
The Annual Meeting of the Stockholders of FMC Gold Company (the "Company") will
be held in the Gold Room of The Stanford Court Hotel, Nob Hill, San Francisco,
California, on Wednesday, May 3, 1995, at 11:00 AM for the following purposes:
1. To elect six directors of the Company to hold office for one year and
until their successors are respectively elected and qualified;
2. To ratify the appointment of KPMG Peat Marwick, LLP as the Company's
independent auditors for fiscal year 1995; and
3. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
Only stockholders of record at the close of business on March 15, 1995, are
entitled to notice of, and to vote at, the meeting and at any adjournment or
postponement thereof. A complete list of such stockholders will be open for
examination by any stockholder for any purpose germane to the meeting at the
offices of Pillsbury, Madison & Sutro, 235 Montgomery Street, Suite 1652B, San
Francisco, California, Attention: E. Griffin, for a period of 10 days prior to
the meeting.
IF YOU DO NOT EXPECT TO ATTEND IN PERSON, PLEASE SIGN AND RETURN THE ENCLOSED
PROXY.
By order of the Board of Directors
Robert L. Day
Secretary
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
Solicitation.............................................................. 1
I. Election of Directors............................................... 1
Nominees for Director............................................... 2
Information Concerning the Board of Directors....................... 2
Security Ownership of the Company................................... 3
Continuing Intercompany Arrangements................................ 4
II. Ratification of Selection of Independent Auditors................... 5
III. Executive Compensation.............................................. 6
IV. Vote Required....................................................... 12
V. Proposals for 1996 Annual Meeting................................... 12
VI. Compliance With Section 16(a) of the Securities Exchange Act........ 12
VII. Other Matters....................................................... 12
</TABLE>
<PAGE>
PROXY STATEMENT
FMC Gold Company
5011 Meadowood Way, Suite 200
Reno, Nevada 89502
March 20, 1995
SOLICITATION
This Proxy Statement is being furnished in connection with the solicitation of
proxies by the Board of Directors of FMC Gold Company, a Delaware corporation
("FMC Gold" or the "Company") from holders of the Company's outstanding shares
of common stock, par value of $.01 per share (the "Common Stock") for use at
the Annual Meeting of Stockholders of the Company (the "Annual Meeting") to be
held at the time and place and for the purposes set forth in the accompanying
Notice. Proxies furnished may be revoked by a stockholder at any time prior to
their use and the shares represented by the proxies received will be voted as
directed. If no direction is given, the shares will be voted as recommended by
the Board of Directors.
The Company will pay all expenses connected with the solicitation of proxies.
In addition to solicitation by mail, officers, directors and regular employees
of the Company or FMC Corporation ("FMC") may solicit proxies by telephone,
telegraph or personal call without special compensation therefor. The Company
expects to reimburse banks, brokers and other persons for their reasonable out-
of-pocket expenses in handling proxy material for beneficial owners.
Only holders of record of Common Stock at the close of business on March 15,
1995, are entitled to vote at the Annual Meeting. On that date there were
issued and outstanding 73,484,395 shares of Common Stock. Each of such shares
is entitled to one vote.
The Annual Report of the Company for the year 1994, including financial
statements, and this proxy statement and accompanying form of proxy, were
mailed on March 20, 1995, to all stockholders of record as of March 15, 1995.
I. ELECTION OF DIRECTORS
Unless directed otherwise, the proxies received will be voted for the nominees
named below. The management expects that all nominees will be able and willing
to serve as directors. If any nominee is unable or declines to serve, the
proxies will be voted for a person nominated by the present Board of Directors
to fill the vacancy or the size of the Board may be reduced.
<PAGE>
RECOMMENDATION OF THE BOARD
THE BOARD RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES LISTED BELOW AS
DIRECTORS OF THE COMPANY.
NOMINEES FOR DIRECTOR
<TABLE>
<CAPTION>
Principal Occupation,
Age Other Directorships Year First
at and Position with the Elected
Name of Nominee 3/1/95 Company a Director
- --------------- ------ --------------------- ----------
<S> <C> <C> <C>
Larry D. 52 Chairman of the Board and Chief Executive Officer 1991
Brady of the Company since November 1991; President (93)
and a Director (89) of FMC; Executive Vice Presi-
dent of FMC (89)
Robert N. 57 Chairman of the Board and Chief Executive Officer 1988
Burt of the Company (89-91); Chairman of the Board and
Chief Executive Officer of FMC since November 1,
1991; President of FMC (90-93); Director of
Phelps-Dodge Corporation
Paul L. 64 President, Lakeside Corporation; Partner--Law Firm 1987
Davies, Jr. of Pillsbury, Madison & Sutro (63-89); Director of
FMC, Sumitomo Bank of California
Nha D. Hoang 52 Vice President--International of the Company since 1993
November, 1993; Director, International of FMC
(87-93)
Brian J. 51 President of the Company since 1987 1987
Kennedy
Edmund W. 80 Retired Chairman and Chief Executive Officer, Utah 1987
Littlefield International, Inc.
</TABLE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS
Directors who are not employees of the Company or FMC each receive an annual
fee of $10,000 for service on the Board and an attendance fee of $500 for each
meeting of the Board or its committees. Directors who are also officers or
employees of the Company or of FMC are not entitled to any fees.
During 1994, the Board of Directors held four meetings and, except for Mr.
Burt, the incumbent nominees attended at least 75 percent of all meetings of
the Board and its committees.
The Board has a standing Audit Committee and a standing Compensation Committee,
each consisting of Messrs. Davies and Littlefield.
The Audit Committee reviews the effectiveness of the independent public
accountants and internal auditors, including the scope of their audit
activities and ensures that no restrictions are placed on the
2
<PAGE>
scope or implementation of their audits; the fees of the independent public
accountants and any significant comments or problems identified as a result of
their audits; and the nature of any material changes in accounting policies or
practices. The Committee also inquires into the effectiveness and adequacy of
the Company's financial and accounting organization and internal controls,
reviews officers' expense accounts, reviews with management and the independent
public accountants the financial statements and other material included in any
registration statement or annual report filed with the Securities and Exchange
Commission, reviews transactions between the Company and FMC and evaluates
procedures for securing and confirming compliance with the Business Conduct
Guidelines. The Audit Committee, of which Mr. Littlefield is Chairman, met
twice during 1994.
The Compensation Committee reviews and approves executive compensation policies
and practices, and establishes the total compensation for the President-Chief
Operating Officer. In addition, the Committee approves participants in the
Company's long term incentive plan, financial targets for performance awards,
and the form and amounts of awards to be made under the plan. The Compensation
Committee, of which Mr. Davies is Chairman, met twice during 1994.
The Board does not have a standing nominating committee.
SECURITY OWNERSHIP OF THE COMPANY
Management. The following table shows, as of March 1, 1995, the number of
shares of Common Stock of the Company and shares of Common Stock of FMC
beneficially owned by each director and nominee, each of the persons named in
the Summary Compensation Table and by all directors and executive officers of
the Company as a group:
<TABLE>
<CAPTION>
Amount and Nature of
Beneficial
Ownership(1)
--------------------
FMC Gold FMC
Name of Beneficial Owner Company Corporation
------------------------ -------- -----------
<S> <C> <C>
Steven E. Baginski 27,207 135(2)
Donald L. Beckwith 500 3,876(2)
Larry D. Brady 3,000 86,040(2)
Robert N. Burt 1,000 133,672(2)
Paul L. Davies, Jr. 1,000 38,551(2)(3)
Nha D. Hoang -- 3,848(2)
Robert A. Horn -- 85(2)
Brian J. Kennedy 700 10,368(2)
Edmund W. Littlefield 3,600 --
All directors and executive officers as a group
(10 persons) 37,107 286,255(2)
</TABLE>
- --------
(1) Each of the individuals referred to holds less than 1 percent of the
outstanding Company Shares and FMC Shares. Except as noted, all reported
shares are owned of record and beneficially.
(2) Includes (i) shares held directly, (ii) shares held by the FMC Employees'
Thrift and Stock Purchase Plan and (iii) shares subject to options that are
exercisable. Item (ii) and (iii) in the aggregate are: Mr. Beckwith, 3,876
shares; Mr. Brady, 71,340 shares; Mr. Burt, 87,191 shares; Mr. Hoang, 3,848
shares; Mr. Kennedy, 10,368 shares; Mr. Horn, 85 shares; and for all
directors and officers as a group, 186,388 shares.
(3) Includes 25,000 shares owned by Mr. Davies as direct beneficial owner;
4,500 shares held in trust of which Mr. Davies is the trustee or a co-
trustee; and 7,000 shares owned by Mr. Davies' wife. Mr. Davies disclaims
beneficial interest in 9,500 of these shares. Also includes 2,051 shares
credited to Mr. Davies' account under the FMC Deferred Stock Plan for Non-
Employee Directors.
3
<PAGE>
Certain Other Beneficial Owners. The following table shows the name and address
of each person known to the Company to own more than 5 percent of the Company's
outstanding shares of Common Stock as of March 1, 1995:
<TABLE>
<CAPTION>
Amount and
Nature of Percent
Name and Address Beneficial of
of Beneficial Owner Ownership Class
----------------------------------------------- ---------- -------
<S> <C> <C>
Meridian Minerals Company 8,000,000(1) 10.9%
5613 DTC Parkway
Englewood, Colorado 80111
FMC Corporation 58,790,700(2) 80.0%
200 East Randolph Drive Chicago, Illinois 60601
</TABLE>
- --------
(1) Meridian Minerals, a subsidiary of Burlington Resources, Inc., acquired
these shares as part of the acquisition by the Company in 1990 of Meridian
Gold Company.
(2) Includes six million shares held of record by FMC Wyoming Corporation, a
wholly owned subsidiary of FMC.
CONTINUING INTERCOMPANY ARRANGEMENTS
The following discussions are summaries of the management services and tax
allocation agreements between the Company and FMC.
Management Services Agreement. Effective as of May 2, 1987, the Company entered
into a management services agreement (the "Management Services Agreement") with
FMC pursuant to which FMC has agreed to furnish executive, administrative,
financial, accounting, legal, environmental, tax, research and development,
employee benefits plan, risk management and certain other services to the
Company upon the Company's request. The nature and extent of the services
provided by FMC under the Management Services Agreement are similar to those
historically provided by FMC. The Management Services Agreement is terminable
as of the end of any year by either party upon 60-days written notice. The
Company compensates FMC at FMC's direct and indirect cost, including allocated
overhead, for services provided by FMC. Overhead allocations have been (and FMC
has advised the Company that such allocations are expected to continue to be)
based, among other things, on the level of Company sales compared with
aggregate FMC sales.
The Management Services Agreement also provides for the use of the services of
certain of the Company's employees (primarily geologists) by FMC on a similar
cost compensation basis. The Company believes that all determinations with
respect to direct and indirect costs (including allocated overhead) under the
Management Services Agreement have been made by FMC in a manner that is fair
and reasonable in the circumstances. FMC will also determine which personnel
are available to provide services for the Company. The Company's financial
statements reflect costs of $1.6 million for the year ended December 31, 1994,
computed in accordance with the Management Services Agreement.
4
<PAGE>
Principally as a cash management device, the Management Services Agreement also
provides for intercompany loans of excess cash to FMC or from FMC to the
Company. Any such advances are repayable on a demand basis and bear interest at
a rate equal to FMC's then current weighted average borrowing cost on debt of
like maturity or investing rate for the relevant period.
Tax Allocation Agreement. The Company has been included in the consolidated
Federal income tax return filed by FMC as the common parent for itself and its
other subsidiary companies for all tax periods ending on or before May 15,
1990. Effective May 15, 1990, the Company began to file separate consolidated
federal tax returns on a stand-alone basis. For taxable years beginning with
1988 and ending May 15, 1990, the Company and FMC have entered into an
agreement (the "Tax Agreement"), which provided generally that the Company
would pay to FMC amounts of regular Federal income tax equal to the tax the
Company would then have been required to pay if it had filed a separate return
and would pay such amount whether or not FMC was in a current taxpaying
position. The Company was also liable to FMC for a percentage of consolidated
return alternative corporate minimum tax liability, if any, even in those cases
where the Company was not liable for alternative corporate minimum tax on a
separate return basis.
In case of carrybacks of the Company's losses or credits to years ending on or
before May 15, 1990 in which the Company could have utilized such loss or
credit, FMC will pay to the Company amounts equal to the refunds arising from
such carrybacks that the Company would then have been entitled to receive had
it filed separate Company returns. The Company believes that all determinations
under the Tax Agreement have been made by FMC in a manner that is fair and
reasonable in the circumstances. The Company also has a continuing agreement
with FMC covering state income taxes.
Purchase of Products and Other Arrangements. In the ordinary course of
business, the Company and its Jerritt Canyon joint venture purchase certain
products from FMC (principally sodium cyanide for the Paradise Peak and Royal
Mountain King operations and soda ash for the Jerritt Canyon mill). In 1994
purchases of sodium cyanide amounted to $1.9 million, and there were no
purchases of soda ash. All purchases (and any other transactions between the
Company and FMC that are not specifically discussed above) were on terms no
less favorable than the Company believes could be obtained from an unaffiliated
third party, giving due consideration where appropriate to the Company's status
as a long-term and preferred customer of FMC.
II. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
KPMG Peat Marwick, LLP, which served as independent auditors for the Company in
1994, has been recommended by the Audit Committee of the Board to act in that
capacity in 1995. A representative of KPMG Peat Marwick, LLP is expected to be
present at the meeting, with the opportunity to make a statement if such
representative desires to do so, and will be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE SELECTION OF
KPMG PEAT MARWICK, LLP AS INDEPENDENT AUDITORS FOR THE YEAR 1995.
5
<PAGE>
III. EXECUTIVE COMPENSATION
The following tables, charts and narrative show all compensation that has been
awarded or paid to or earned by the Chief Executive Officer and each executive
officer whose total salary and bonus in 1994 exceeded $100,000:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Compensation
Annual --------------------
Compensation Awards Payouts
-------------- ------------ -------
(1) (2)
(1) LTIP All Other
Name And Principal Salary Bonus Options/SARs Payouts Compensation
Position Year ($) ($) (#) ($) ($)
(A) (B) (C) (D) (E) (F) (G)
------------------ ---- ------- ------ ------------ ------- ------------
<S> <C> <C> <C> <C> <C> <C>
Larry D. Brady (3) 1994 20,741 16,386 2,430(4) -- 1,515
Chairman of the Board, 1993 18,790 9,110 -- -- 1,426
and Chief Executive Of-
ficer
1992 17,443 11,620 1,570(4) -- 1,510
Brian J. Kennedy 1994 163,728 43,715 -- -- 11,258
President 1993 157,231 58,254 -- -- 10,751
1992 149,740 70,978 64,600 155,520 8,433
Donald L. Beckwith 1994 118,879 19,615 -- -- 8,145
Vice President--Opera-
tions 1993 118,879 42,261 -- -- 7,984
1992 114,962 49,319 38,600 99,790 6,174
Steven E. Baginski (5) 1994 107,100 20,081 -- -- 3,391
Vice President--Finance 1993 52,500 16,209 -- -- 1,531
1992 -- -- -- -- --
Nha D. Hoang (5) 1994 159,589 38,780 -- -- 10,788
Vice President--Interna-
tional 1993 52,410 51,875 26,000 -- 10,637
1992 -- -- -- -- --
Robert A. Horn (5) 1994 114,583 33,750 19,000 -- 4,687
Vice President--Explora-
tion 1993 -- -- -- -- --
1992 -- -- -- -- --
</TABLE>
- --------
(1) Executive officers who were granted options after 1991 were also granted
contingent performance awards which become payable, in cash, in 1996 only
if (i) the Compensation Committee determines that the options then have
little or no value, (ii) the officer has continued in the employment of the
Company, and (iii) performance objectives established by the Committee are
achieved. The amounts of such contingent awards were $124,800 for Mr.
Kennedy and $74,600 for Mr. Beckwith. LTIP payments in 1992 are the
contingent cash awards granted in 1988 in tandem with stock options which,
on December 31, 1992, had no value.
(2) Consists of Company matching payments to Thrift (401(k)) plans.
(3) All compensation shown for Mr. Brady represents allocations to the Company
under the Management Services Agreement.
(4) Allocated portion of options to purchase FMC Common Stock granted by FMC.
(5) Messrs. Baginski and Hoang joined the Company in 1993. Mr. Horn joined the
Company in 1994.
6
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
Shown in the table below is information on grants of stock options pursuant to
the Company's Long-Term Incentive Compensation Plan during 1994 to the officers
named in the Summary Compensation Table. The table also shows the value of such
options, if any, will be .3 percent of the increase in value to the other
stockholders of the Company.
<TABLE>
<CAPTION>
Individual Grants
- ------------------------------------------------------------------
Percent of Potential Realizable Value at
Total Assumed Annual Rates of Stock
Options Options/SARs Appreciation for Option Term (1)
Granted Granted to Exercise or ---------------------------------
in 1994 Employees in Base Price Expiration 0% 5% 10%
(#) Fiscal Year ($/SH) Date ($) ($) ($)
Name (A) (B) (C) (D) (E) (F) (G) (H)
- --------------------- ------- ------------ ----------- ---------- ------------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Larry D. Brady -- -- -- -- -- -- --
Brian J. Kennedy -- -- -- -- -- -- --
Steven E. Baginski -- -- -- -- -- -- --
Donald L. Beckwith -- -- -- -- -- -- --
Nha D. Hoang -- -- -- -- -- -- --
Robert A. Horn(2) 19,000 100 4.25 4/29/07 0 50,783 128,695
All Stockholders N/A N/A N/A N/A 0 196,409,223 497,739,495
All Optionees 19,000 100 4.25 4/29/07 0 50,783 128,695(3)
Optionee Gain as % of
All Stockholder Gain N/A N/A N/A N/A N/A .03 .03
</TABLE>
- --------
(1) The dollar amounts under these columns are the result of calculations at 0
percent and at the arbitrary 5 percent and 10 percent rates set by the SEC
and therefore are not intended to forecast possible future appreciation, if
any, in the Company's stock price. The Company did not use an alternative
formula for a grant date valuation as it is not aware of any formula which
will determine with reasonable accuracy a present value based on future
unknown or volatile factors.
(2) Mr. Horn resigned in January, 1995, and all options granted to him in 1994
were cancelled.
(3) No gain to the optionees is possible without appreciation in the stock
price which will benefit all stockholders commensurately.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
Shown below is further information with respect to options to purchase the
Company's Common Stock. No options were exercised in 1994 by any of the named
persons and, as of December 31, 1994, the exercise price applicable to all
options was significantly above market price. The closing price of the
Company's Common Stock at December 31, 1994, was $3.375.
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised in
Options/SARs at Fiscal the money options at
Year-End (#) Fiscal Year-End ($)
------------------------- -------------------------
Exercisable/Unexercisable Exercisable/Unexercisable
Name (A) (B) (C)
-------- ------------------------- -------------------------
<S> <C> <C>
Larry D. Brady -- --
Brian J. Kennedy 42,200/64,600 0/0
Donald L. Beckwith 29,000/38,600 0/0
Steven E. Baginski 0/0 0/0
Nha D. Hoang 0/26,000 0/0
Robert A. Horn 0/19,000 0/0
</TABLE>
7
<PAGE>
RETIREMENT PLANS
Under the Pension Plan and its supplements, "covered remuneration" includes
only the remuneration appearing in Columns (C) and (D) of the Summary
Compensation Table on page 6. The following table shows the estimated annual
retirement benefits under the Pension Plan for eligible salaried employees
(including officers) payable to employees at various salary levels who retire
in 1994 at age 65 (normal retirement age) for representative years of service.
The amount shown will not be reduced by Social Security benefits or other
offsets. Payment of benefits shown is contingent upon continuance of the
present provisions of the Pension Plan until the employee retires.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
Estimated Annual Retirement Benefits for
Years of Service Indicated
-------------------------------------------
15
Final Average Earnings Years 20 Years 25 Years 30 Years 35 years
---------------------- ------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$ 50,000.................... $ 9,306 $ 12,408 $ 15,510 $ 18,612 $ 21,714
150,000.................... 31,806 42,408 53,010 63,612 74,214
250,000.................... 54,306 72,408 90,510 108,612 126,714
350,000.................... 76,806 102,408 128,010 153,612 179,214
</TABLE>
Final average earnings in the above table means the average of covered
remuneration for the highest 60 consecutive calendar months out of the 120
calendar months immediately preceding retirement. Benefits applicable to a
number of years of service or final average earnings different from those in
the above table, or to a person who retires after 1994, are equal to the sum of
(A) 1 percent of allowable Social Security Covered Compensation ($25,920 for a
participant retiring at age 65 in 1995) times years of credited service and (B)
1.5 percent of the difference between final average earnings and allowable
Social Security Covered Compensation times years of credited service. ERISA
limits the annual benefits that may be paid from a tax-qualified retirement
plan. Accordingly, as permitted by ERISA, the Company has adopted supplemental
arrangements to maintain total benefits upon retirement at the levels shown in
the table. At March 15, 1995, Messrs. Kennedy, Beckwith, Baginski and Hoang
had, respectively, 21, 15, 2 and 10 years of credited service under the Plan.
Mr. Horn resigned in January, 1995.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
FMC Gold's executive compensation program is designed to align total
compensation with shareholder interests. The program:
. Incents and rewards executives for sound business management and
improvement in shareholder value.
. Balances its components so that annual financial and longer term
strategic objectives are recognized.
. Requires achievement of objectives within a "high performance"
environment to be rewarded financially.
. Attracts, motivates and retains executives necessary for the long-term
success of FMC Gold.
8
<PAGE>
The program comprises three compensation components--base salary, variable
incentive awards (annual bonus) and long-term incentive awards (stock options).
Base Salary. FMC Gold uses external survey sources provided by MCS-777, Hewitt
Associates and Wyatt Mining Industry survey to set competitive compensation
levels (salary ranges) for its executives. These databases cover most companies
in the Fortune 500 and many competitors in the mining industry. Companies in
the S&P Gold Index are well represented.
Salary ranges for FMC Gold executives are established that relate to similar
positions in other companies of comparable size and complexity. Within these
ranges, target performance levels are delineated to recognize different levels
of performance ranging from a "learner" or "needs improvement" level to an
"exceptional" level. Base salaries are established after evaluating an
employee's overall contribution to the Company, including his or her
performance against objectives agreed to at the beginning of the period. The
importance of each item will vary from year to year depending on what needs to
be emphasized that year. During 1994, emphasis was placed on the strategic
direction for the Jerritt Canyon mine, development of foreign and United States
exploration properties and effective management of the closure of the Paradise
Peak and Royal Mountain King mines.
The starting placement in salary range is a function of an employee's
contribution (i.e., skills, experience and expertise, and anticipated job
performance). Each year, performance is evaluated against mutually agreed-upon
objectives and performance standards that may, in large part, be highly
subjective; a performance rating is established; and a salary increase may be
granted. Salary ranges are set for executive positions after evaluation of the
relative importance of each position to the organization and upon review of
external salary information from comparable companies with similar positions.
Comparisons are made with salaries paid at 25 percent, 50 percent and 75
percent of the survey data, as appropriate. Mr. Kennedy's salary may vary
around the 50th percentile of the companies surveyed, taking into account the
size and complexity of those companies surveyed and his performance.
B.J. Kennedy has served as President since 1987. In determining his salary
increase for 1994, the Compensation Committee considered the Company's creative
reclamation approaches at the Paradise Peak and Royal Mountain King properties;
its good progress in developing exploration properties; and continued
administrative cost-saving measures. His 1994 performance included his
strategic efforts in working effectively with the majority partner at the
Jerritt Canyon mine and in continuing the Company's exploration initiatives
outside of North America.
Variable Incentive Award (annual bonus). All executives participate in the
Company's Management Incentive Plan. Achievement of high standards of business
and individual performance are rewarded financially, and significant
compensation is at risk for failing to meet those high standards. At the
executive level target incentives range from 25-30 percent of base salary,
while the actual payments can range from zero to twice the target incentive
based on performance, and are calculated by comparing financial performance and
individual strategic performance to objectives established for the year.
9
<PAGE>
Business performance was weighted at 40 percent of the total and is evaluated
against an Operating Profit After Tax target. Strategic performance, weighted
at 60 percent, is measured against key strategic objectives which focused on
globalization, profitable growth and diversity, as well as exploration and gold
discovery. In 1994, neither OPAT nor strategic performance targets were met.
Long-term Incentive Awards. The Company's long-term incentive plan is designed
to link closely the long-term reward of executives with increases in
shareholder value. While giving broad discretion to the Committee to select
appropriate types of awards, it has consisted of a combination of non-qualified
stock options and a conditional dollar award payable only if the stock option
has little or no value at the end of a four-year period, performance criteria
are met and the Compensation Committee approves payment. The award vesting
period is four years, with an option term of 15 years. Certain executives of
the Company, typically the financial officers, have been regarded as having
career opportunities throughout FMC Corporation, the Company's parent, and are
therefore given awards under FMC's long-term plan rather than under the
Company's plan. Those awards generally are structured and calculated in the
same manner as under the Company's plan.
To determine the number of options to be granted to an executive, the Committee
first multiplies the midpoint of the salary range for an executive's salary
grade by a percentage applicable to that grade (ranging from 20 percent to 50
percent) and divides that product by the then current market price for the
Company's shares. The Committee then applies a multiple based on comparative
data, individual contributions and potential and current business conditions.
In recent years that multiple has ranged from one to three. In approving grants
under the Plan, the number of options previously awarded to and held by
executive officers is considered but is not regarded as a significant factor in
determining the size of current option grants.
Performance targets applicable to the conditional dollar award have been
subjective, requiring the Committee to assess the performance of a participant
in terms of shareholder value improvement using criteria such as relative share
price performance, gold reserve additions, operating performance and other
considerations the Committee deems appropriate. No conditional dollar awards
were paid in 1994.
Awards to persons named in the Summary Compensation Table and other executive
officers are generally made every four years; no awards were made in 1994
except for one newly elected officer.
The $1 million cap on tax-deductible compensation is not an issue for FMC Gold
since the total compensation of its executives does not reach that level.
The preceding report has been furnished by the following members of the
Compensation Committee:
Paul L. Davies, Jr., Chairman
Edmund W. Littlefield
10
<PAGE>
STOCKHOLDER RETURN PERFORMANCE PRESENTATION
Set forth below is a line graph comparing the yearly change in the cumulative
total stockholder return on the Company's Common Stock against the cumulative
total return of the S&P Composite 500 Stock Index and the S&P Gold Index for
the period of five fiscal years commencing January 1, 1990 and ended December
31, 1994.
LOGO
<TABLE>
<CAPTION>
DECEMBER 31 1989 1990 1991 1992 1993 1994
- -------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FMC GOLD ^ 100.00 80.66 44.64 40.62 47.84 31.21
- -------------------------------------------------------
S&P 500 . 100.00 96.89 126.42 136.05 149.76 151.74
- -------------------------------------------------------
S&P GOLD ^ 100.00 88.31 71.73 66.98 122.70 99.13
</TABLE>
Assumes that the value of the investment in the Company's Common Stock and each
index was $100 on December 31, 1989, and that all dividends were reinvested.
11
<PAGE>
IV. VOTE REQUIRED
Under Delaware law, directors are elected by a plurality of the votes of the
shares present in person or represented by proxy at the meeting and entitled to
vote on the election of directors. This means that the seven nominees for
election as directors at the Annual Meeting who receive the greatest number of
votes cast for the election of directors by the holders of the Company's Common
Stock entitled to vote at that meeting, a quorum being present, shall become
directors at the conclusion of the tabulation of votes. An affirmative vote of
the holders of a majority of the Company's Common Stock present in person or
represented by proxy and entitled to vote at the meeting, a quorum being
present, is necessary to approve the action proposed in item II of this Proxy
Statement.
Under Delaware law and the Company's Certificate of Incorporation and By-Laws,
the aggregate number of votes entitled to be cast by all stockholders present
in person or represented by proxy at the meeting, whether those stockholders
vote "FOR", "AGAINST", or abstain from voting, will be counted for purposes of
determining the minimum number of affirmative votes required for approval of
item II, and the total number of votes cast "FOR" that matter will be counted
for purposes of determining whether sufficient affirmative votes have been
cast. An abstention from voting and broker non-votes on a matter have the same
legal effect as a vote "against" the matter.
V. PROPOSALS FOR 1996 ANNUAL MEETING
Stockholder proposals for the 1996 Annual Meeting must be received at the
principal executive offices of the Company not later than November 20, 1995,
for inclusion in the 1996 proxy statement and form of proxy.
VI. COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act requires the Company's officers
and directors, and persons who own more than ten percent of a registered class
of the Company's equity securities, to file reports of ownership and changes in
ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission (SEC)
and the New York Stock Exchange. The Company has undertaken the preparation and
filing of such reports on behalf of its officers and directors.
Based solely on the Company's review of the forms it has filed and copies of
such forms it has received, the Company believes that all its officers,
directors and greater than ten percent beneficial owners complied with all
filing requirements applicable to them with respect to transactions during
fiscal 1994.
VII. OTHER MATTERS
The Board does not know of any other business which may be presented for
consideration at the meeting. If any business not described herein should come
before the meeting, the persons named in the enclosed proxy will vote on those
matters in accordance with their best judgment.
Robert L. Day
Secretary
12
<PAGE>
FMC Gold Company
5011 Meadowood Way
Reno, Nevada 89502
- -------------------------------------------------------------------------------
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
MAY 3, 1995
AND PROXY STATEMENT
- -------------------------------------------------------------------------------
LOGO
FMC GOLD COMPANY
<PAGE>
PROXY FMC GOLD COMPANY
LOGO
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Larry D. Brady, Brian J. Kennedy and Robert L.
Day, and each of them, proxy for the undersigned, with full power of
substitution, to vote in the manner indicated on the reverse side, and with
discretionary authority as to any other matters that may properly come before
the meeting, all shares of common stock of FMC Gold Company which the
undersigned is entitled to vote at the annual meeting of stockholders of FMC
Gold Company to be held on May 3, 1995 at the Gold Room of The Stanford Court
Hotel, Nob Hill, San Francisco, California, at 11:00 A.M. or any adjournment
thereof.
NOT VALID UNLESS DATED AND SIGNED ON REVERSE SIDE
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.
<PAGE>
-- FMC GOLD COMPANY --
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [_]
[ ]
1.ELECTION OF SEVEN DIRECTORS--
Nominees: L. D Brady, Robert N. Burt, Paul L. Davies, Jr., Nha D. Hoang, Brian
J. Kennedy and Edmund W. Littlefield. (Except nominee(s) written below).
For All
For [_] Withheld [_] Except [_]
2. Ratification of the Appointment of Independent Auditors.
For [_] Against [_] Abstain [_]
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2.
---
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Dated: ___________________ , 1995
Signature(s)____________________________________________________________________
- --------------------------------------------------------------------------------
Please sign exactly as name appears at left. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
