<PAGE>
SCHEDULE 14A
REQUIRED BY RULE 14a-6(m)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
IMPERIAL HOLLY CORPORATION
(Name of Registrant as Specified in Its Charter)
IMPERIAL HOLLY CORPORATION
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
/ / $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 transactions applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
/ / 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 registrations 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:
- --------------------------------------------------------------------------------
(1)Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE>
[logo]
I.H. KEMPNER, III
CHAIRMAN
June 16, 1994
Dear Fellow Shareholder:
This year the Annual Meeting of Shareholders will be held on Friday, July
29, 1994 at 11:00 a.m. at the Sugar Creek Country Club, 420 Sugar Creek
Boulevard, Sugar Land, Texas 77478. You are cordially invited to attend.
At the meeting, we will elect five directors and act on the selection of
auditors.
Your Board of Directors joins me in urging you to attend to hear a report on
the Company's progress during the past year and to meet with members of
management. However, even if you plan to attend the meeting in person, I hope
you will sign, date and return your proxy as soon as possible. Your vote is
always important.
Sincerely,
I.H. KEMPNER, III
I.H. Kempner, III
ONE IMPERIAL SQUARE * P.O. BOX 9 * SUGAR LAND, TEXAS 77487-0009
<PAGE>
IMPERIAL HOLLY CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JULY 29, 1994
To the Shareholders of Imperial Holly Corporation:
The Annual Meeting of Shareholders of Imperial Holly Corporation (the
'Company') will be held at the Sugar Creek Country Club, 420 Sugar Creek
Boulevard, Sugar Land, Texas 77478, on Friday, July 29, 1994, at 11:00 a.m.,
Central time, for the following purposes:
(1) to elect five directors to serve for three-year terms until the
1997 Annual Meeting of Shareholders and until their successors are
qualified;
(2) to consider and act upon a proposal to ratify the appointment of
the firm Deloitte & Touche, independent certified public accountants, as
auditors of the Company for its fiscal year ending March 31, 1995; and
(3) to transact such other business as may properly come before the
meeting or any adjournment thereof.
Shareholders of record at the close of business on June 1, 1994 are entitled
to notice of and to vote at the meeting.
The By-Laws of the Company require that the holders of a majority of the
outstanding shares of Common Stock entitled to vote be represented in person or
by proxy at the meeting in order to constitute a quorum for the transaction of
business. Therefore, regardless of the number of shares you hold, it is
important that your stock be represented at the meeting.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, WE ASK THAT YOU PLEASE SIGN
AND DATE THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN THE POSTAGE PREPAID
ENVELOPE PROVIDED.
By Order of the Board of Directors
WILLIAM F. SCHWER
SECRETARY
Sugar Land, Texas
June 16, 1994
<PAGE>
IMPERIAL HOLLY CORPORATION
ONE IMPERIAL SQUARE
SUGAR LAND, TEXAS 77478
PROXY STATEMENT
1994 ANNUAL MEETING OF SHAREHOLDERS
The accompanying proxy is solicited on behalf of the Board of Directors of
Imperial Holly Corporation (the 'Company') to be voted at the 1994 Annual
Meeting of Shareholders of the Company to be held at the time and place and for
the purposes set forth in the foregoing notice. In addition to the original
solicitation by mail, certain regular employees of the Company may solicit
proxies by telephone, by telegraph or in person. The Company has retained D. F.
King & Co., Inc. on customary terms and at a fee estimated not to exceed $4,500,
plus reasonable expenses, to assist in soliciting proxies. All expenses of
soliciting proxies, including the cost of preparing and mailing this Proxy
Statement and the reimbursement of brokerage firms and other nominees for their
reasonable expenses in forwarding proxy material to beneficial owners of stock,
will be borne by the Company. If you attend the meeting, you may vote in person
if you wish, even though you have mailed in your proxy. This Proxy Statement and
the accompanying proxy are being mailed to shareholders beginning on or about
June 16, 1994.
All duly executed proxies will be voted in accordance with the instructions
thereon. However, shareholders who execute proxies retain the right to revoke
them at any time before they are voted. The revocation of a proxy shall not be
effective until written notice thereof has been given to the Secretary of the
Company, unless the person granting such proxy votes in person.
Unless otherwise indicated on the proxy, shares will be voted by the persons
named on the accompanying proxy as follows:
(a) for the election of the five directors named below; and
(b) for ratification of the selection of Deloitte & Touche as the
Company's independent auditors.
The majority of the outstanding shares of common stock, without par value,
of the Company ('Common Stock') entitled to vote must be present in person or by
proxy at the meeting in order to constitute a quorum for the transaction of
business. Shares underlying a proxy marked 'Abstain' on a matter will be
considered to be represented at the meeting for quorum purposes.
Shares registered in the names of brokers or other 'street name' nominees
for which proxies are voted on some but not all matters will be considered to be
present at the meeting for quorum purposes, but will be considered to be voted
only as to those matters actually voted, and will not be considered as voting
for any purpose as to the matters with respect to which no vote is indicated
(commonly referred to as 'broker non-votes').
Directors are elected by a plurality of votes cast. The affirmative vote of
the majority of the votes cast is required for adoption of the proposal referred
to in (b). Abstentions and broker non-votes will have no effect on the outcome
of the vote.
The persons named in the accompanying proxy may act with discretionary
authority should any nominee become unavailable for election, although
management is unaware of any circumstances
1
<PAGE>
likely to render any of the nominees unavailable. Management does not intend to
bring any other matters before the meeting and has not been informed that any
other matters are to be presented to the meeting by others.
At the close of business on June 1, 1994, the record date for the
determination of shareholders entitled to vote at the meeting, the Company had
outstanding 10,256,814 shares of Common Stock, which is the only class of stock
of the Company outstanding and entitled to vote at the meeting. Each shareholder
is entitled to one vote for each share of Common Stock held. Cumulative voting
is not allowed.
PROPOSAL 1: ELECTION OF DIRECTORS
The Company's Board of Directors is divided into three classes designated
Class I, Class II and Class III, with staggered terms of office. The number of
directors in each of the three classes is to be as nearly equal as possible.
After the election of directors at the 1994 Annual Meeting, the terms of office
of the Class III directors will extend until the Annual Meeting of Shareholders
in 1997 (and until their successors are qualified). The terms of office of the
Class I directors extend until the Annual Meeting of Shareholders in 1995 and
the terms of office of the Class II directors extend until the Annual Meeting of
Shareholders in 1996 (and, in each case, until their successors are qualified).
At the 1994 Annual Meeting, it is proposed to elect A. M. Bartolo, Ann O.
Hamilton, Harris L. Kempner, Jr., H. E. Lentz and Fayez Sarofim as directors in
Class III. All of the nominees are currently serving as directors of the
Company.
NOMINEES
Set forth below is certain information concerning the five nominees for
election as directors at the 1994 Annual Meeting, including the business
experience of each during the past five years and the age of each nominee on
June l, 1994.
A. M. BARTOLO, a director since March 1970, joined the Company in March 1958
and served in various capacities until his retirement in May 1994. At the time
of his retirement, Mr. Bartolo was Executive Vice President and Chief Operating
Officer of the Company and President of the Imperial Sugar Company, a division
of Imperial Holly Corporation ('Imperial Sugar Company'). Mr. Bartolo is age 65.
ANN O. HAMILTON, a director of the Company since 1974, has been employed by
the World Bank in Washington, D.C. since 1970. Mrs. Hamilton, age 56, has been
Director -- Bangladesh, Bhutan & Nepal since 1993. She was Director of the
Population & Human Resources Department from 1987 to 1992. Prior thereto, she
served World Bank in other capacities including Chief of the Indonesia Division
and Chief of the India Division.
HARRIS L. KEMPNER, JR., a director of the Company since 1966, has been
President of Kempner Capital Management, Inc., an investment advisory firm,
since 1982 and a trustee of the H. Kempner Trust Association since 1967. He
served as Chairman of the Board of United States National Bank from 1988 to 1993
when he became Chairman Emeritus. Mr. Kempner, age 54, is a director of
Cullen/Frost Bankers, Inc., TNP Enterprises, Inc. and American Indemnity
Financial Corporation.
H. E. LENTZ has been a director of the Company since December 1993. Mr.
Lentz, age 49, has been a Managing Director of Lehman Brothers, Inc., an
investment banking firm, since March 1993. Prior thereto, Mr. Lentz served as
Vice Chairman of Wasserstein Perella & Co. from 1988 to
2
<PAGE>
February 1993 and as Managing Director of Shearson Lehman Hutton, Inc. from 1984
to 1988. Mr. Lentz serves as a director of the Rowan Companies, Inc.
FAYEZ SAROFIM, a director of the Company since 1991, is President and
Chairman of the Board of Fayez Sarofim & Co., an investment advisory firm he
founded in 1958. Mr. Sarofim, age 65, is currently a director of Teledyne, Inc.,
Argonaut Group, Unitrin, Inc., MESA, Inc. and the IFINT Societe Anonyme.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE 'FOR' A. M. BARTOLO, ANN O.
HAMILTON, HARRIS L. KEMPNER, JR., H. E. LENTZ AND FAYEZ SAROFIM AS
DIRECTORS.
CONTINUING DIRECTORS
Set forth below is certain information concerning the eight directors of the
Company whose present terms of office will continue until 1995 or 1996,
including the business experience of each during the past five years and the age
of each director on June l, 1994.
Directors in Class I
(Terms Expiring at 1995 Annual Meeting of Shareholders)
JOHN D. CURTIN, JR. has been a Director of the Company since June 1993. Mr.
Curtin is Executive Vice President and a director of Cabot Corporation, a
specialty chemicals and materials company and manufacturer of carbon black. Mr.
Curtin served from 1989 to 1992 as Chief Financial Officer of Cabot Corporation
and from 1974 to 1989 as President, Chief Executive Officer and Director of
Curtin & Co., Inc., a private investment banking firm. Mr. Curtin, age 61, is a
Director of American Oil and Gas Corporation and Augat, Inc.
I. H. KEMPNER, III has been Chairman of the Board of Directors of the
Company since 1971 and was first elected a director of the Company in 1967. He
became Chairman of the Executive Committee in 1978. Mr. Kempner joined the
Company in 1964 and served in various executive capacities prior to his election
as Chairman of the Board in 1971. Mr. Kempner, age 61, is a director of the
Houston Branch of the Federal Reserve Bank of Dallas.
JAMES C. KEMPNER, a director since 1988, was appointed President and Chief
Executive Officer of the Company in October 1993. Mr. Kempner is also the Chief
Financial Officer, a position he has held since he joined the Company in 1988.
Mr. Kempner, age 54, was elected President of Imperial Sugar Company upon Mr.
Bartolo's retirement in May 1994. Mr. Kempner had previously served as Imperial
Sugar Company's President. From 1988 to 1993, Mr. Kempner was an Executive Vice
President and Chief Financial Officer of the Company. From 1977 to 1988, Mr.
Kempner was employed by Pogo Producing Company, an oil and gas exploration and
production company, where he served in various capacities, the most recent being
Vice President -- Finance.
DANIEL K. THORNE was elected a director of the Company in June 1988. For
more than the past five years, Mr. Thorne has been the President of Star Lake
Cattle Company and Star Lake Properties, Inc., which are engaged in cattle and
timber operations, and the President of Eagle Island Citrus Corporation, a
citrus production operation. Mr. Thorne, age 42, is also a director of Commerce
Clearing House, Inc.
3
<PAGE>
Directors in Class II
(Terms Expiring at 1996 Annual Meeting of Shareholders)
EDWARD O. GAYLORD, who has been a director of the Company since 1978, has
been the President and a director of Gaylord & Company, Inc., a venture capital
business, since 1988. Since January 1993, he has been Chairman of EOTT Energy
Corporation, an oil trading and transportation company. Mr. Gaylord was Chairman
and Chief Executive Officer of Presto Industries, Inc., which is engaged in the
manufacture of plastic packaging, from 1985 to 1988. Mr. Gaylord, age 62, is
also a director of Seneca Foods Corporation and Stant Corporation.
ROBERT C. HANNA, Vice Chairman of the Board of Directors since October 1993,
has been a director of the Company since 1976. Mr. Hanna served as President of
the Company from 1979 and Chief Executive Officer from 1980 until his retirement
in October 1993. Mr. Hanna, age 65, joined the Company in 1955 and has served in
various capacities throughout his career. Mr. Hanna is also a director of NorAm
Energy Corp. (formerly Arkla, Inc.) and Chairman of the Board of Memorial
Healthcare Systems, Inc.
ROGER W. HILL has been an Executive Vice President and a director of the
Company and President and Chief Executive Officer of Holly Sugar Corporation
('Holly Sugar') since 1988, when Holly Sugar was acquired as a wholly owned
subsidiary of the Company. Mr. Hill, age 54, joined Holly Sugar in 1963 and
served in various capacities throughout his career.
ROBERT L. K. LYNCH has been a director of the Company since 1990 and has
directed the purchase and restoration of historic buildings primarily in
Galveston, Texas since 1975. Mr. Lynch, age 44, has been President of Galveston
Management Company, a real estate development and management company, since 1987
and has been a member of the City Council of Galveston since 1990. In addition,
Mr. Lynch is a director of the United States National Bank.
Mr. I. H. Kempner, III and Mr. James C. Kempner are brothers and are first
cousins of Mr. Harris L. Kempner, Jr. In addition, Mrs. Hamilton, Mr. Harris L.
Kempner, Jr., Mr. I. H. Kempner, III, Mr. James C. Kempner, Mr. Lynch and
Mr. Thorne are each descendants of H. Kempner, a Galveston entrepreneur who
died in 1894.
BOARD COMMITTEES AND MEETINGS
The Company's Board of Directors has four standing committees: Executive,
Audit, Executive Compensation and a recently formed Environmental Committee.
Except for the Executive Committee, the committees are composed of members who
are not officers or employees of the Company or its subsidiaries. The membership
and principal responsibilities of those committees are described below. The
Board has no standing nominating committee.
At intervals between formal meetings, members of the Board and each
committee are provided with information regarding the operations of the Company
and are consulted on an informal basis with respect to pending business. Such
consultation may lead to Board or committee action between meetings being taken
by unanimous written consent.
During the 1994 fiscal year, each incumbent director attended at least 75%
of the aggregate of the total number of meetings of the Board and its committees
on which the director served. The Board met four times during the 1994 fiscal
year.
4
<PAGE>
EXECUTIVE COMMITTEE
Members: I. H. Kempner, III (Chairman)
Edward O. Gaylord
Robert C. Hanna
James C. Kempner
The Executive Committee exercises the powers of the Board to manage the
Company between meetings of the Board. During fiscal year 1994, the Executive
Committee met once.
AUDIT COMMITTEE
Members: Harris L. Kempner, Jr. (Chairman)
Edward O. Gaylord
Daniel K. Thorne
The Audit Committee reviews with the Company's internal auditor and
independent certified public accountants the scope and results of their audits,
monitors the adequacy of the Company's system of internal controls and
procedures, recommends to the board the selection of the independent certified
public accountants and reviews the fees paid for services rendered by such
accountants. During the 1994 fiscal year the Audit Committee met three times.
EXECUTIVE COMPENSATION COMMITTEE
Members: Edward O. Gaylord (Chairman)
John D. Curtin, Jr.
Fayez Sarofim
The Executive Compensation Committee establishes the salaries, bonuses and
other compensation for the Company's directors, executive officers and certain
other managerial and professional personnel. The Committee reviews and approves
or in some cases recommends to the Board the Company's compensation plans. The
Executive Compensation Committee also administers the granting of incentives to
eligible employees under the Company's Stock Incentive Plan and administers the
Company's incentive bonus plans. The Executive Compensation Committee met once
during the 1994 fiscal year.
ENVIRONMENTAL COMMITTEE
Members: Robert L. K. Lynch (Chairman)
A. M. Bartolo
The Environmental Committee was formed in April 1994 to oversee all aspects
of the Company's environmental policy and compliance with the policy, including
the adequacy of management's programs for implementing the environmental policy.
The Committee reviews, reports on and makes recommendations to the Board
regarding the policy.
5
<PAGE>
DIRECTOR REMUNERATION
Each director of the Company who is not an officer of the Company receives
$18,000 per annum for serving as a director, plus $1,000 for each Board meeting
attended. Additionally, each such director who serves on a committee receives
$1,000 for each committee meeting attended if the meeting is not held on the
same day as a Board meeting. Each director is also reimbursed by the Company for
travel expenses incurred in connection with attendance at Board or committee
meetings or other business of the Company.
Under the Company's 1989 Nonemployee Director Stock Option Plan, each
director of the Company who is not an employee of the Company is automatically
granted an option on the later of (i) July 27, 1989 or (ii) the date the
director becomes a director of the Company. Each option permits the optionee to
purchase 1,500 shares of Common Stock at an exercise price per share equal to
50% of the fair market value of a share of Common Stock on the date the option
is granted. Options granted under the Nonemployee Director Stock Option Plan are
not exercisable until the optionee has completed three years of service as a
director of the Company. In the event of a 'change in control' of the Company
(as defined in the Nonemployee Director Stock Option Plan), any unvested portion
of the options will immediately become exercisable in full.
Options under the Nonemployee Director Stock Option Plan were granted during
fiscal 1994 to Messrs. Curtin and Lentz. No options were exercised pursuant to
the Plan during the fiscal year.
The Imperial Holly Corporation Retirement Plan for Nonemployee Directors is
a non-qualified retirement plan providing monthly retirement benefits to retired
directors of the Company who never served as employees of the Company. The plan
provides for payments, commencing at the later of age 65 or retirement, equal to
the retainer received by the director at the date of the director's retirement
for up to ten years after retirement (based on years of service) to a director
who retires after completion of three years of service. Death benefits equal to
50% of the retirement benefit are paid to a surviving spouse.
EXECUTIVE COMPENSATION
The following table and narrative sets forth the compensation of the two
individuals who served as chief executive officer during the fiscal year ended
March 31, 1994 along with the other four most highly compensated executive
officers (together with the chief executive officers, the 'named officers') of
the Company for services rendered in all capacities during fiscal 1992, 1993 and
1994. Mr. Hanna, formerly President and Chief Executive Officer, retired October
1, 1993.
6
<PAGE>
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
AWARDS
SECURITIES
OTHER UNDERLYING
FISCAL ANNUAL OPTIONS/SARS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION(2) (NUMBER)(3) COMPENSATION(4)
<S> <C> <C> <C> <C> <C> <C>
James C. Kempner--------------------- 1994 $ 313,008 $ 7,000 $ 13,243 50,000 $ 0
President, Chief Executive 1993 275,000 2,500 6,702 0 0
Officer, Chief Financial 1992 275,000 5,000 9,877 0 0
Officer and President,
Imperial Sugar Company(5)
I. H. Kempner, III------------------- 1994 305,277 7,000 23,016 50,000 3,812
Chairman of the 1993 315,000 5,000 15,002 0 3,812
Board of Directors 1992 315,000 10,000 18,145 0 3,812
A. M. Bartolo------------------------ 1994 260,016 0 15,473 0 5,088
Executive Vice President, 1993 250,000 1,000 13,391 0 5,088
Chief Operating Officer 1992 250,000 54,069 15,452 0 5,088
and President, Imperial
Sugar Company(6)
Roger W. Hill------------------------ 1994 270,432 7,000 49,081 10,000 0
Executive Vice President and 1993 260,016 2,500 14,689 0 0
President, Holly Sugar 1992 260,016 15,526 19,395 0 0
Corporation
Harry J. Smith----------------------- 1994 166,680 25,000 53,408 25,000 0
Executive Vice President, Sales and
Marketing(7)
Robert C. Hanna---------------------- 1994 195,000 0 123,924 0 4,958
President and Chief 1993 375,000 2,500 31,500 0 4,958
Executive Officer(8) 1992 375,000 7,500 35,013 0 4,958
(1) Awards are non-performance based discretionary bonuses except that Mr.
Bartolo's fiscal year 1992 award includes a payment of $51,569 under the
performance-based Officer Incentive Plan. In connection with his employment,
Mr. Smith received a negotiated bonus for fiscal 1994.
(2) Amounts are primarily payments under the Company's vacation policy and for
taxes due on perquisites. Monetary service awards, which are earned on every
fifth anniversary of employment, are also included when paid. Mr. Hill's
fiscal year 1994 other annual compensation included a $6,565 automobile
allowance and a $22,408 disability insurance policy premium. For Mr. Smith
in fiscal 1994, the amount includes a special one-time payment of $41,391 to
compensate him for loss incurred on the sale of his residence upon
employment with the Company. In fiscal year 1994, $44,998 of Mr. Hanna's
other annual compensation consisted of payments in lieu of accrued vacation.
(3) SARs are included with respect to 3,333 of Mr. Smith's options granted. No
other options granted in fiscal year 1994 include SARs.
(4) Represents split dollar life insurance premiums. The Company has a
collateral interest in each policy in an amount equal to approximately three
times the annual premium.
(5) Mr. James C. Kempner became President and Chief Executive Officer on October
1, 1993. Compensation shown above is for services rendered in all
capacities.
(6) Mr. Bartolo retired May 1, 1994.
(7) Mr. Smith joined the Company June 1, 1993.
(8) Mr. Hanna retired October 1, 1993.
</TABLE>
7
<PAGE>
STOCK OPTIONS
The following table reflects information with respect to stock options
granted by the Executive Compensation Committee to the named officers during
fiscal 1994 as indicated in the Summary Compensation Table. All options listed
in the table below have an exercise price equal to the fair market value per
share of Common Stock on the date of grant. The options provide that the
optionee may satisfy the exercise price with cash or shares of Common Stock
owned by the optionee. Income tax withholding obligations may be satisfied by
having the Company withhold shares of Common Stock issuable upon exercise.
<TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
INDIVIDUAL GRANTS
NUMBER
OF PERCENT POTENTIAL
SECURITIES OF TOTAL REALIZABLE VALUE
UNDERLYING OPTIONS/SARS AT ASSUMED ANNUAL
OPTIONS/ GRANTED TO EXERCISE RATES OF STOCK
SARS EMPLOYEES OR BASE PRICE APPRECIATION
GRANTED IN FISCAL PRICE EXPIRATION FOR OPTION TERM(4)
NAME (NUMBER) YEAR ($/SHARE) DATE 5%($) 10%($)
<S> <C> <C> <C> <C> <C> <C>
James C. Kempner--------------------- 50,000(1) 24.3% $ 8.6875 12/15/03 $ 273,176 $ 692,282
I. H. Kempner, III------------------- 50,000(1) 24.3 8.6875 12/15/03 273,176 692,282
A. M. Bartolo------------------------ -- -- -- -- -- --
Roger W. Hill------------------------ 10,000(2) 4.9 8.6875 12/15/03 54,635 138,456
Harry J. Smith----------------------- 15,000(2) 7.3 8.6875 12/15/03 81,953 207,685
10,000(3) 4.9 14.000 7/01/03 88,045 223,124
Robert C. Hanna---------------------- -- -- -- -- -- --
(1) Incentive stock options vest in four equal annual increments of 11,500
shares beginning on December 15, 1994 and a final increment of 4,000 shares
vesting on January 2, 1998.
(2) Non-qualified stock options vest in four equal annual increments beginning
December 15, 1994.
(3) Non-qualified stock options vest in four equal annual increments beginning
July 1, 1994. Includes tandem SARs with respect to one-third of the shares
subject to the underlying option.
(4) These amounts represent certain assumed rates of appreciation only and are
purely theoretical. Actual gains, if any, on stock option exercises are
dependent on future performance of the stock. There can be no assurance that
the amounts reflected in this table will be achieved.
</TABLE>
8
<PAGE>
The following table reflects certain information with respect to stock
options exercised during fiscal 1994 and unexercised options held at March 31,
1994.
<TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
<CAPTION>
NUMBER OF VALUE OF
UNEXERCISED UNEXERCISED
SHARES OPTIONS/SARS IN-THE-MONEY
ACQUIRED ON AT MARCH 31, 1994 OPTIONS/SARS AT
EXERCISE VALUE (NUMBER) MARCH 31, 1994(4)
NAME (NUMBER) REALIZED(1) EXERCISABLE(2) UNEXERCISABLE(3) EXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C> <C> <C>
James C. Kempner--------------------- 0 $ 0 33,975 53,000 $ 76,313 $ 40,625
I. H. Kempner, III------------------- 10,000 24,931 42,425 54,500 88,382 40,625
A. M. Bartolo------------------------ 9,365 20,421 9,000 3,000 0 0
Roger W. Hill------------------------ 0 0 33,975 13,000 76,313 8,125
Harry J. Smith----------------------- 0 0 0 25,000 0 12,188
Robert C. Hanna---------------------- 0 0 16,500 5,500 0 0
(1) Value realized equals the fair market value of the Common Stock on the date
exercised (average of the reported high and low market price of underlying
Common Stock on date of exercise as reported by the American Stock Exchange)
less the exercise price, times the number of shares acquired.
(2) Includes tandem SARs with respect to one-third of the shares subject to the
underlying option.
(3) The following options include tandem SARs with respect to one-third of the
shares subject to the underlying option: 3,000 for Mr. James C. Kempner;
4,500 for Mr. I. H. Kempner, III; 3,000 for Mr. Bartolo; 3,000 for Mr. Hill,
10,000 for Mr. Smith and 5,500 for Mr. Hanna.
(4) Calculated based upon the March 31, 1994 average of the high and low market
price per share of $9.50 (as reported by the American Stock Exchange) less
the exercise price per share, times the number of shares.
</TABLE>
RETIREMENT PLAN
The Imperial Holly Corporation Retirement Plan (the 'Retirement Plan') is a
tax qualified defined benefit plan covering salaried (non-union) employees of
the Company and its subsidiaries generally, including executive officers. The
Company has also adopted a Benefit Restoration Plan for certain participants
(including each of the named officers) to supplement the benefits payable under
the Retirement Plan to the extent the limitations on qualified plan benefits
mandated by the Internal Revenue Code of 1986, as amended (the 'Code'), reduce
retirement benefits that would otherwise be payable under the Retirement Plan.
9
<PAGE>
Benefits under the Retirement Plan equal the sum of benefits with respect to
service prior to a cutoff-date (Category I Service) and service after such
cutoff-date (Category II service). The cutoff-date is December 31, 1988 or, with
respect to service with Holly Sugar, December 31, 1974. The following tables set
forth estimated annual benefits (before giving effect to Code limits) payable
for eligible employees who retire at age 65 (normal retirement age) under the
Retirement Plan for Category I service and Category II service.
<TABLE>
TOTAL ANNUAL BENEFIT AMOUNT
CATEGORY I SERVICE
<CAPTION>
FINAL YEARS OF SERVICE
AVERAGE 5 10 15 20 25 30 35
<S> <C> <C> <C> <C> <C> <C> <C>
240,000------------------------------ 14,541 29,082 43,623 58,164 72,705 87,246 101,787
300,000------------------------------ 18,291 36,582 54,873 73,164 91,455 109,746 128,037
350,000------------------------------ 21,416 42,832 64,248 85,664 107,080 128,496 149,912
400,000------------------------------ 24,541 49,082 73,623 98,164 122,705 147,246 171,787
450,000------------------------------ 27,666 55,332 82,998 110,664 138,330 165,996 193,662
500,000------------------------------ 30,791 61,582 92,373 123,164 153,955 184,746 215,537
550,000------------------------------ 33,916 67,832 101,748 135,664 169,580 203,496 237,412
</TABLE>
<TABLE>
TOTAL ANNUAL BENEFIT AMOUNT
CATEGORY II SERVICE
<CAPTION>
FINAL YEARS OF SERVICE
AVERAGE 5 10 15 20 25 30 35
<S> <C> <C> <C> <C> <C> <C> <C>
240,000------------------------------ 16,341 32,682 49,023 65,364 81,705 98,046 114,387
300,000------------------------------ 20,541 41,082 61,623 82,164 102,705 123,246 143,787
350,000------------------------------ 24,041 48,082 72,123 96,164 120,205 144,246 168,287
400,000------------------------------ 27,541 55,082 82,623 110,164 137,705 165,246 192,787
450,000------------------------------ 31,041 62,082 93,123 124,164 155,205 186,246 217,287
500,000------------------------------ 34,541 69,082 103,623 138,164 172,705 207,246 241,787
550,000------------------------------ 38,041 76,082 114,123 152,164 190,205 228,246 266,287
</TABLE>
Compensation under the Retirement Plan is defined as taxable earnings,
including salary, bonus and other annual compensation reported in the Summary
Compensation Table above, as well as the taxable income realized on exercise of
stock options and the value for federal income tax purposes of certain employee
benefits and other perquisites. Such compensation during fiscal 1994 for the
named officers was approximately as follows: Mr. James C. Kempner, $368,700; Mr.
I. H. Kempner, III, $407,200; Mr. Bartolo, $304,600; Mr. Hill, $306,300; Mr.
Smith $280,800 and Mr. Hanna, $324,900. Annual benefits provided under the
Retirement Plan are in addition to social security benefits for employees and
are integrated with amounts payable pursuant to annuities distributed to
participants in connection with benefits accrued as of the spinoff/terminations
of predecessors of the Retirement Plan. Benefits are defined in terms of a
five-year certain and life annuity; several other payment options are available
to employees. For purposes of the Retirement Plan, the years of Category I and
Category II service, respectively, as of March 31, 1994 for the named officers
are as follows: Mr. James C. Kempner (1/5); Mr. I. H. Kempner, III (25/5); Mr.
Bartolo, (31/5) and Mr. Hill (12/19). Mr. Smith will become a plan participant
on July 1, 1994. As of March 31, 1994, Mr. Smith had no
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<PAGE>
Category I Service and ten months of Category II service. Mr. Hanna's years of
service were fixed (at 34/5) upon his retirement. The amounts shown above do not
include benefits based on employee contributions that were permitted in prior
years. The Retirement Plan does not currently allow employee contributions.
Benefits payable under the Retirement Plan are limited by various provisions
of the Code that restrict the amount of compensation that may be taken into
account to calculate benefits under qualified plans and other limits on the
maximum benefit payable from qualified plans. To the extent the pension
calculated pursuant to the tables above would exceed the maximum amount
permitted by the Code, the difference would be payable from the Benefit
Restoration Plan as a discounted lump sum upon the participant's retirement.
In connection with his planned retirement in May 1994, the Company paid Mr.
Bartolo $607,070 in December 1993 under the Benefit Restoration Plan. A final
payment of approximately $55,000 will be made to Mr. Bartolo in June 1994. Mr.
Hanna received a final payment in October 1993 of $206,208 under the Benefit
Restoration Plan.
SALARY CONTINUATION PLAN
The Company has agreed to provide lump sum supplemental retirement and death
benefits to participants (currently eight executive officers, including each of
the named officers other than Mr. Bartolo and Mr. Hanna) in the Salary
Continuation Plan. The plan also provides for monthly salary continuation
payments in the event of disability (as defined). If a participant's employment
is terminated prior to retirement for any reason other than death, disability or
cause (as defined), the participant will be entitled to receive, upon his
attainment of age 55 if his termination is prior thereto, the actuarial
equivalent (as defined) of the payment he would have received had he retired at
age 65 (in certain cases, reduced according to a vesting schedule specified in
the applicable agreement). No amounts will be due under the plan to a
participant who is terminated for cause. The estimated amounts payable upon
retirement at or after age 62 for each of the named officers are as follows:
$2,300,742 for Mr. James C. Kempner; $994,390 for Mr. I. H. Kempner, III;
$790,372 for Mr. Hill and $935,420 for Mr. Smith. In December 1993, Mr. Bartolo
was paid $843,859 representing the amount that would have been due upon his
retirement in May 1994 of $853,747, discounted to date of payment at 3.5% per
annum. All payments due Mr. Hanna under the Salary Continuation Plan were paid
during the 1993 fiscal year.
EMPLOYMENT AGREEMENTS AND RELATED ARRANGEMENTS
The Company has Employment Agreements and Severance Pay Agreements (the
'Agreements') with ten of its executive officers (including each of the named
officers except Mr. Bartolo and Mr. Hanna). The Employment Agreements expire as
follows: July 1998 for Mr. James C. Kempner; September 1997 for Mr. I. H.
Kempner, III; July 1998 for Mr. Hill and October 1997 for Mr. Smith. The
Employment Agreements provide that the Company will employ the executive at an
annual base salary not less than an amount specified in the Employment
Agreement. If terminated by the Company for any reason other than a 'Non-Salary
Event' (cause (as defined), death or total and permanent disability (as
defined)), the executive will be entitled to receive as liquidated damages the
present value of the greater of his minimum base salary provided for in the
Agreement, or the salary then being paid to him, for the remaining term of
employment as if there had been no termination. If the named officer had been
terminated as of March 31, 1994, payments under the Employment Agreements would
have been: $1,291,888 for Mr. James C. Kempner, $1,075,466 for Mr. I. H.
11
<PAGE>
Kempner, III, $1,027,528 for Mr. Hill and $642,909 for Mr. Smith. The Severance
Pay Agreements provide that in the event of the executive officer's death or
involuntary termination of employment (as defined) prior to his attaining age 65
but after a change in control of the Company (as defined), the executive officer
or his beneficiary shall be entitled to receive a payment equal to the greater
of (i) the product of one-fourth of the executive officer's average monthly
salary over the preceding twelve months multiplied by the number of full years
of service with the Company and its affiliates, or (ii) the total of the annual
bonuses received during the 36 months preceding his death or involuntary
termination of employment. If a change of control had occurred and if the
service of the named officers had been terminated as of March 31, 1994 under the
conditions described above, the amounts due under the Severance Pay Agreements
would have been $122,800 for Mr. James C. Kempner; $198,055 for Mr. I. H.
Kempner, III; $174,654 for Mr. Hill and $0 for Mr. Smith.
The Benefit Restoration Plan and the Salary Continuation Plan provide for
full vesting of benefits in the event of a change in control of the Company (as
defined). Payments may become due under the Severance Pay Agreements only after
a change in control. Such plans and agreements provide that the aggregate
present value of all 'parachute payments' (within the meaning of Section 280G of
the Code) shall not exceed one dollar less than three times the executive's
'base amount' (within the meaning of Section 280G).
The Company has established an Executive Benefits Trust which may be used to
fund its obligations under certain otherwise unfunded benefit, retirement and
deferred compensation plans providing benefits to executive officers of the
Company in the event of a change in control.
12
<PAGE>
THE REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE ON EXECUTIVE
COMPENSATION AND THE SHAREHOLDER RETURN PERFORMANCE GRAPH WHICH FOLLOW
SHALL NOT BE DEEMED TO BE INCORPORATED BY REFERENCE INTO ANY FILING MADE
BY THE COMPANY UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, NOTWITHSTANDING ANY GENERAL
STATEMENT CONTAINED IN ANY SUCH FILING INCORPORATING THIS PROXY
STATEMENT BY REFERENCE, EXCEPT TO THE EXTENT THE COMPANY INCORPORATES
SUCH REPORT AND GRAPH BY SPECIFIC REFERENCE.
SHAREHOLDER RETURN PERFORMANCE GRAPH
The following performance graph compares the cumulative total shareholder
return on the Common Stock to the cumulative total return of the Standard &
Poor's 500 Stock Index and the Standard & Poor's Food Index for the last five
fiscal years ending March 31. The graph assumes that the value of the investment
in the Common Stock and each index was $1.00 at March 31, 1989 and that all
dividends were reinvested on a quarterly basis.
STOCK PRICE PERFORMANCE
IHK S&P 500 S&P FOOD
1989........ $1 $1 $1
1990........ 1.768 1.153 1.194
1991........ 1.103 1.273 1.598
1992........ 0.995 1.369 1.71
1993........ 1.056 1.532 1.829
1994........ 0.768 1.519 1.646
13
<PAGE>
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION PROGRAM
The Executive Compensation Committee, composed entirely of outside
directors, is responsible for establishing the salaries, bonuses and other
compensation for the Company's directors, executive officers and certain other
managerial and professional personnel. The Committee reviews and approves or in
some cases recommends to the Board the Company's compensation plans. The
Executive Compensation Committee also administers the Company's Stock Incentive
Plan as well as the Company's other incentive plans.
COMPENSATION POLICIES AND PROGRAMS
The Executive Compensation Committee believes that the overall objective of
the executive compensation program should be to encourage enhancement of
shareholder value, and that this is best accomplished by tying the financial
interests of the Company's executives closely to the interests of the Company's
shareholders. The Executive Compensation Committee believes that the Company's
executive compensation program should (1) motivate executives toward effective
long-term management of the Company's assets through stock programs which focus
executives' attention on increasing shareholder value as measured by stock
price; (2) reward effective, efficient ongoing management of Company operations
through annual incentives which are tied to Company, departmental and individual
performance; and (3) provide the ability to attract and retain executives
through competitive salary levels.
The Company's executive compensation program includes base salary, annual
incentive bonuses and stock options, each of which is tied to performance.
Base Salary: Base salaries for executive officers are set near the median
levels determined by the Executive Compensation Committee to be sufficient to
attract and retain qualified executive officers. This determination is based
upon a survey of nine peer food product and ingredient companies conducted by an
independent compensation consultant retained by the Company. Base salary
increases are provided to executive officers based on an evaluation of each
executive's performance, as well as the performance of the corporation as a
whole. In establishing base salaries, the Committee not only considers the
financial performance of the Company, but also the success of the executive
officers in developing and executing the Company's strategic plans, developing
management employees and exercising leadership. Based upon the Company's
performance in fiscal 1994, no increases in base salary were awarded to
executive officers (other than for promotions).
Annual Incentive Bonuses: The Executive Compensation Committee believes
that a significant proportion of an executive's total cash compensation should
be subject to the attainment of Company earnings criteria based upon a specific
return on total capitalization. The Committee determines performance objectives
(based on financial, operational, departmental and individual performance)
annually and no payment will be made unless the minimum performance threshold
established by the Committee is surpassed. In 1994, the Company's targeted
objectives were not achieved and no incentive bonus awards were made.
Stock Options: The Executive Compensation Committee believes that equity
participation is a key component of the Company's executive compensation
program. Stock options are granted to executive officers primarily based on the
officer's actual and potential contribution to the Company's growth and
profitability and market compensation practices. Option grants are designed to
retain executive officers and motivate them to enhance shareholder value. The
purpose of option grants is to align the financial interests of executive
officers with those of shareholders, particularly over the long term. To
accomplish this objective, all options have been granted with an exercise price
equal to the
14
<PAGE>
fair market value at the time of grant. Thus, option holders only realize value
to the same extent that all shareholders realize value since the benefit cannot
be obtained unless an appreciation in the common stock price occurs over the
life of the options. The size of stock grants is based primarily on competitive
practice. In fiscal 1994, 158,000 options were granted to executive officers.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The Chief Executive Officer's compensation package consists of salary,
annual cash bonus (if qualified pursuant to the Company's incentive plans) and
stock option awards. Mr. James C. Kempner's current base salary of $340,000 is
below the median for peer companies based upon the aforementioned salary survey.
Because the Company's earnings performance objectives were not met, Mr. James C.
Kempner did not qualify for, nor receive, a cash bonus under the Company's
incentive plans. A total of 50,000 incentive stock options were granted to Mr.
James C. Kempner in fiscal year 1994. The option grant was below the national
average annual stock option grant awarded chief executive officers based on the
survey and was set near the minimum amount recommended by the Company's
independent compensation consultant.
Section 162(m) of the Code does not allow the deduction of certain
compensation to any covered employee in excess of $1 million per year, unless
the compensation meets certain standards for performance based compensation. The
Committee believes that the Company's stock options currently qualify as
performance based compensation. The Committee does not anticipate that any
executive officer will receive other compensation in excess of the limit during
1995. Therefore, the Committee did not take any action concerning the limit
during 1994. The Committee will continue to monitor this situation and will take
appropriate action if warranted in the future.
THE EXECUTIVE COMPENSATION COMMITTEE
Edward O. Gaylord, Chairman
John D. Curtin, Jr.
Fayez Sarofim
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Gaylord is Chairman of the Executive Compensation Committee. In 1989,
the Company became one of the limited partners of ChartCo Terminal, L.P.
('ChartCo') upon the formation thereof and made a capital contribution of
$1,000,000 to ChartCo. A company owned by Mr. Gaylord is the general partner of
ChartCo, which owns an interest in a fuel oil terminal in Houston, Texas. The
percentage interests of the partners in ChartCo are in proportion to their
respective capital contributions.
Fayez Sarofim & Co. acts as an investment advisor to the Company, the
Retirement Plan and other employee benefit plans maintained by the Company.
During fiscal 1994, Fayez Sarofim & Co. received approximately $209,000 for such
services. Fayez Sarofim, a director and owner of more than 5% of the Common
Stock, is Chairman of the Board, President and owner of a majority of the
outstanding capital stock of Fayez Sarofim & Co.
15
<PAGE>
SECURITY OWNERSHIP
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information with respect to persons
known by the Company to be beneficial owners of 5% or more of the Common Stock
based upon reports filed by such persons with the Securities and Exchange
Commission. Unless otherwise indicated, these persons have sole voting and
investment power over the shares of Common Stock listed below.
BENEFICIAL OWNERSHIP
OF COMMON STOCK
NUMBER OF PERCENTAGE
NAME SHARES OF CLASS
Daniel K. Thorne(1) ----------------- 719,866 7.0%
P. O. Box 308
Georges Mills, New Hampshire 03751
Fayez Sarofim(2) -------------------- 676,500 6.6%
Two Houston Center, Suite 2907
Houston, Texas 77010
Harris K. Weston(3)(4)(5) ----------- 1,398,950 13.6%
Dinsmore & Shohl
1900 Chemed Center
255 East 5th Street
Cincinnati, Ohio 45202
United States National Bank(6) ------ 1,881,374 18.3%
P. O. Box 179
Galveston, Texas 77553
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information with respect to the
ownership of Common Stock as of June 1, 1994 of each director of the Company,
each of the named officers and all directors and executive officers of the
Company as a group. Unless otherwise indicated, the beneficial owners have sole
voting and investment power over the shares of Common Stock listed below.
BENEFICIAL OWNERSHIP
OF COMMON STOCK
NUMBER PERCENTAGE
NAME OF SHARES OF CLASS
A. M. Bartolo(2)--------------------- 54,933 *
John D. Curtin, Jr------------------- 2,000 *
Edward O. Gaylord-------------------- 24,000 *
Ann O. Hamilton(4)------------------- 307,593 3.0%
Robert C. Hanna(2)------------------- 96,136 *
Roger W. Hill(2)--------------------- 43,506 *
Harris L. Kempner, Jr.(3)(7)--------- 376,983 3.7%
I. H. Kempner, III(2)(3)(8)---------- 463,883 4.5%
James C. Kempner(2)(3)(9)------------ 390,916 3.8%
H. E. Lentz-------------------------- 13,000 *
Robert L. K. Lynch(2)(4)(10)--------- 411,162 4.0%
Fayez Sarofim(2)--------------------- 676,500 6.6%
Harry J. Smith(2)-------------------- 0 *
Daniel K. Thorne(1)------------------ 719,866 7.0%
All directors and executive officers
as a group (25 persons)(2)--------- 3,052,816 29.8%
(FOOTNOTES ON FOLLOWING PAGE)
16
<PAGE>
* Percentage of shares of Common Stock beneficially owned does not exceed 1%
of the class.
(1) Includes 327,142 shares of Common Stock owned by a testamentary trust as to
which Mr. Thorne is the sole beneficiary and a co-trustee. Also includes
169,447 shares owned by the Alan Pryce-Jones Trust, as to which Mr. Thorne
is a co-trustee and 875 shares owned by his wife to which Mr. Thorne
disclaims beneficial ownership.
(2) Includes shares subject to stock options exercisable within 60 days as
follows: Mr. Sarofim, 1,500 shares; Mr. Bartolo, 9,000 shares; Mr. Hanna,
16,500 shares; Mr. Hill, 33,975 shares; Mr. I. H. Kempner, III, 42,425
shares; Mr. James C. Kempner, 33,975 shares; Mr. Lynch, 1,500 shares; Mr.
Smith, 2,500 shares and all directors and executive officers as a group,
197,984 shares.
(3) Includes 249,563 shares of Common Stock owned by the H. Kempner Trust
Association, over which I. H. Kempner, III, James C. Kempner, Harris L.
Kempner, Jr. and Harris K. Weston share voting power and investment power
as co-trustees with one other co-trustee.
(4) Includes 134,187 shares of Common Stock owned by the Harris and Eliza
Kempner Fund, a charitable foundation, as to which Ms. Hamilton and Messrs.
Lynch and Weston share voting power and investment power as co-trustees
along with other trustees.
(5) Includes 2,700 shares of Common Stock held by Mr. Weston's wife and 46,800
shares of Common Stock held by Mr. Weston's daughters. Mr. Weston disclaims
beneficial ownership as to such shares owned by his wife and daughters.
Also includes 106,200 shares of Common Stock owned by Mr. Weston as trustee
for three trusts for the benefit of Mr. Weston's daughters and 396,000
shares of Common Stock owned by Mr. Weston as trustee of three charitable
annuity lead trusts, as to all of which shares Mr. Weston disclaims
beneficial ownership.
(6) Consists of 1,881,374 shares of Common Stock which United States National
Bank holds as trustee of various trusts for descendants of H. Kempner,
including the 188,891 shares listed in Note 10 but not including any shares
that are held in nominee form for others. United States National Bank has
sole voting power over 1,880,924 shares. The information given is based on
a Statement on Form 4 filed by the shareholder with the Securities and
Exchange Commission and other information furnished by the shareholder.
(7) Includes 4,608 shares of Common Stock held by Mr. Kempner's spouse and
11,104 shares held by his children, all of which he shares voting and
investment power. Mr. Kempner disclaims beneficial ownership as to such
shares.
(8) Includes 4,443 shares of Common Stock held by Mr. Kempner's wife, as to
which Mr. Kempner disclaims beneficial ownership. Also includes 9,836
shares of Common Stock held by two of his daughters who share his
residence, as to which Mr. Kempner disclaims beneficial ownership.
(9) Includes 6,750 shares of Common Stock owned by a trust of which Mr. Kempner
is a beneficiary.
(10) Includes 188,891 shares of Common Stock owned by a testamentary trust as to
which Mr. Lynch is the income beneficiary and has a power of appointment.
Mr. Lynch does not have voting or investment power with respect to such
shares. Also includes 45,367 shares of Common Stock held by a revocable
trust for the benefit of Mr. Lynch's sister to which Mr. Lynch is
co-trustee and shares voting and investment power with two other
co-trustees. Mr. Lynch disclaims beneficial ownership over the shares held
in trust for his sister.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires officers and
directors of the Company and beneficial owners of more than 10% of the Common
Stock to file reports of ownership and changes in ownership with the Securities
and Exchange Commission and the American Stock Exchange. Officers, directors and
greater than 10% shareholders are required to furnish the Company with copies of
all Section 16(a) forms they file.
17
<PAGE>
Based on a review of Forms 3 and 4 and amendments thereto filed during
fiscal 1994 and Forms 5 and amendments thereto, or written representations that
no Form 5s were required, the Company believes that during fiscal 1994, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than 10% beneficial owners were complied with, with the exceptions
described below. The Alan Pryce-Jones Trust, a family trust, filed its Form 3
relating to Daniel K. Thorne's selection as trustee after it was due. In
addition, Mr. Thorne filed a Form 4 relating to his appointment as trustee after
the date such form was due.
OTHER INFORMATION
In 1991, the Company entered into an interest rate swap with Lehman
Brothers, Inc. which continues until October 1996. Mr. Lentz, who was elected a
director of the Company in December 1993, became a Managing Director of Lehman
Brothers, Inc. in March 1993.
PROPOSAL 2: RATIFICATION OF INDEPENDENT AUDITORS
The Board of Directors, upon recommendation of the Audit Committee, has
approved and recommended the appointment of Deloitte & Touche, independent
certified public accountants, as auditors to examine the Company's financial
statements for the year ending March 31, 1995. Deloitte & Touche has served as
auditors for the Company for over 25 years. Neither such firm nor any of its
associates has any relationship with the Company except in their capacity as
auditors.
A representative of Deloitte & Touche is expected to attend the 1994 Annual
Meeting and be available to respond to appropriate questions raised during the
meeting by shareholders. Such representative will also have an opportunity to
make a statement during the meeting if he so desires.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE 'FOR' RATIFICATION OF THE
APPOINTMENT OF DELOITTE & TOUCHE AS THE COMPANY'S AUDITORS FOR THE FISCAL
YEAR ENDING MARCH 31, 1995.
OTHER MATTERS
Copies of the Company's Annual Report to Shareholders and the Company's
Annual Report on Form 10-K, including financial statements for the fiscal year
ended March 31, 1994, accompany this Proxy Statement but are not a part of the
proxy soliciting material.
18
<PAGE>
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the Company's 1995
Annual Meeting of Shareholders, and otherwise eligible, must be received by the
Company (at the address indicated on the first page of this Proxy Statement) no
later than February 16, 1995 to be eligible for inclusion in the Company's proxy
material relating to that meeting.
REGARDLESS OF THE NUMBER OF SHARES OWNED, IT IS IMPORTANT THAT THEY BE
REPRESENTED AT THE MEETING, AND YOU ARE RESPECTFULLY REQUESTED TO SIGN, DATE
AND RETURN THE ACCOMPANYING PROXY AT YOUR EARLIEST CONVENIENCE.
By Order of the Board of Directors
WILLIAM F. SCHWER
SECRETARY
19
<PAGE>
IMPERIAL HOLLY CORPORATION
1994 ANNUAL MEETING OF SHAREHOLDERS
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints I. H. Kempner, III, James C.
Kempner and Roy E. Henderson, and each of them, with full power of
substitution, the attorneys and proxies of the undersigned to vote
all of the shares of Common Stock, without par value, of Imperial
Holly Corporation (the 'Company') that the undersigned would be
entitled to vote, with all powers that the undersigned would possess
if personally present, at the 1994 Annual Meeting of Shareholders of
Imperial Holly Corporation to be held on July 29, 1994 and at any
adjournment or postponement thereof, on the matters as designated
herein and, in their discretion, on such other matters as may
properly come before the meeting or adjournments thereof, all as set
forth in the accompanying Proxy Statement.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED ON
THE REVERSE. UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED
FOR ELECTION AS DIRECTORS OF ALL OF THE NOMINEES LISTED ON THE
REVERSE AND FOR THE PROPOSAL TO RATIFY THE APPOINTMENT OF DELOITTE &
TOUCHE AS AUDITORS OF THE COMPANY. A majority (or if only one, then
that one) of the proxies or substitutes acting at the meeting, or at
any adjournment or postponement, may exercise the powers conferred
by this Proxy. Receipt of the Notice of Meeting and Proxy Statement
is hereby acknowledged. This Proxy revokes all prior proxies given
by the undersigned.
(CONTINUED, AND TO BE SIGNED AND DATED, ON THE REVERSE SIDE.)
<PAGE>
1. Election of Directors FOR / / WITHHOLD / / EXCEPTIONS / /
To vote your shares for all Director nominees, mark the 'For' box on Item 1. To
withhold voting for all nominees, mark the 'Withhold' box. If you do not wish
your shares voted 'for' a particular nominee, mark the 'Exceptions' box and
enter the name(s) of the exception(s) in the space provided.
A. M. Bartolo, Ann O. Hamilton, Harris L. Kempner, Jr., H. E. Lentz and Fayez
Sarofim.
2. Proposal to ratify the appointment of Deloitte & Touche as auditors of the
Company. FOR / / AGAINST / / ABSTAIN / /
Change of Address and/or comments mark here. / /
PROXY DEPARTMENT
NEW YORK, NY 10203-0513
IMPORTANT:
Please sign exactly as name or names appear on this proxy. If stock is held
jointly, each holder should sign. If signing as attorney, trustee, executor,
administrator, custodian, guardian, or corporate officer, please give full
title.
Date: , 1994
(Signature(s))
PLEASE SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
