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
TREDEGAR INDUSTRIES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
( ) $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
TREDEGAR INDUSTRIES, INC.
1100 BOULDERS PARKWAY
RICHMOND, VIRGINIA 23225
ANNUAL MEETING OF SHAREHOLDERS
March 28, 1995
To the Shareholders:
We invite you to attend the Annual Meeting of Shareholders to be held in
THE GRAND BALLROOM OF THE JEFFERSON HOTEL, ADAMS & FRANKLIN STREETS IN RICHMOND,
VIRGINIA, ON WEDNESDAY, MAY 24, 1995, AT 9:00 A.M., EASTERN DAYLIGHT TIME. A
formal notice of the meeting, together with a proxy statement and proxy form, is
enclosed with this letter. The notice points out that you will be asked to elect
directors and approve the designation of auditors for the coming year.
Please read the notice and proxy statement carefully, complete the proxy
form and mail it promptly.
Sincerely yours,
[Signature]
JOHN D. GOTTWALD
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE>
TREDEGAR INDUSTRIES, INC.
1100 BOULDERS PARKWAY
RICHMOND, VIRGINIA 23225
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting of the holders of shares of
Common Stock, no par value ("Common Stock"), of Tredegar Industries, Inc.
("Tredegar") will be held in THE GRAND BALLROOM OF THE JEFFERSON HOTEL, ADAMS &
FRANKLIN STREETS IN RICHMOND, VIRGINIA, ON WEDNESDAY, MAY 24, 1995, AT 9:00
A.M., EASTERN DAYLIGHT TIME, for the following purposes:
1. To elect three directors to serve until the 1998 annual meeting and
until their successors are elected;
2. To approve the designation of Coopers & Lybrand L.L.P. as auditors for
the fiscal year ending December 31, 1995; and
3. To transact such other business as may properly come before the meeting.
Holders of shares of Common Stock of record at the close of business on
March 20, 1995, will be entitled to vote at the meeting.
You are requested to complete, sign, date and return the enclosed proxy
form promptly, regardless of whether you expect to attend the meeting. A
self-addressed, stamped envelope is enclosed for your convenience.
If you are present at the meeting, you may vote in person even if you have
already returned your proxy.
By Order of the Board of Directors
NANCY M. TAYLOR, SECRETARY
March 28, 1995
<PAGE>
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TREDEGAR INDUSTRIES, INC.
To be held May 24, 1995
Approximate date of mailing -- March 28, 1995
Proxies in the form enclosed are solicited by the Board of Directors of
Tredegar (the "Board") for the Annual Meeting of Shareholders to be held on
Wednesday, May 24, 1995. Any person giving a proxy may revoke it any time before
it is voted by voting in person at the meeting or delivering another proxy, or
written notice of revocation, to the Secretary of Tredegar. A proxy, if executed
and not revoked, will be voted and, if it contains any specific instructions,
will be voted in accordance with such instructions.
On March 20, 1995, the date for determining shareholders entitled to vote
at the meeting, there were 9,026,548 outstanding shares of Common Stock. Each
share of Common Stock is entitled to one vote.
The cost of the solicitation of proxies will be borne by Tredegar. In
addition to the use of the mails, proxies may be solicited personally or by
telephone by regular employees of Tredegar. Corporate Investor Communications,
Inc. has been engaged to assist in the solicitation of proxies from brokers,
nominees, fiduciaries and other custodians. Tredegar will pay that firm $4,500
for its services plus reimbursement for out-of-pocket expenses.
Tredegar's address is 1100 Boulders Parkway, Richmond, Virginia 23225.
ELECTION OF DIRECTORS
The Board is divided into three classes of directors as nearly equal in
number as possible, each of which serves for three years. The term of office of
one class of directors expires each year in rotation so that one class is
elected at each annual meeting for a three-year term.
The terms of four of the present directors, John D. Gottwald, Andre B.
Lacy, James F. Miller and Emmett J. Rice, will expire at the 1995 Annual
Meeting. Messrs. John D. Gottwald, Andre B. Lacy and Emmett J. Rice have been
nominated by the Board for election at the 1995 Annual Meeting for the term
expiring at the 1998 Annual Meeting of Shareholders. Mr. Miller will retire from
Tredegar's Board upon the expiration of his current term.
The election of each nominee for director requires the affirmative vote of
the holders of a plurality of the shares of Common Stock cast in the election of
directors. Unless otherwise specified in the accompanying form of proxy, it is
intended that votes will be cast for the election of all of the nominees as
directors. Votes that are withheld and shares held in street name that are not
voted in the election of directors will not be included in determining the
number of votes cast. If any of the nominees for director should be unavailable
for election, a circumstance that is not expected, the Board may
either reduce the number of directors accordingly or designate a substitute
nominee in the place and stead of the unavailable person. In the latter event,
it is intended that votes in respect of all shares for which proxies have been
given will be cast for the election of such substitute nominee.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" ALL OF THE NOMINEES.
Following is certain information concerning the nominees and the directors
whose terms of office will continue after the meeting:
AUSTIN BROCKENBROUGH, III - age 58; director since 1993; Managing Director and
President of Lowe, Brockenbrough & Tattersall, Inc. (private investment
counseling firm) since 1970. Other directorship: Trustee of The Williamsburg
Investment Trust. Term expires 1997.
PHYLLIS COTHRAN - age 48; director since 1993; President and Chief Operating
Officer of Trigon Blue Cross Blue Shield since November 1990; having served
previously as Chief Financial Officer of Trigon Blue Cross Blue Shield since
1981. Other directorship: Ethyl Corporation ("Ethyl"). Term expires 1996.
RICHARD W. GOODRUM - age 67; director since 1989; Executive Vice President and
Chief Operating Officer of Tredegar since July 10, 1989. Term expires 1996.
BRUCE C. GOTTWALD - age 61; director since 1989; Chairman of the Board and Chief
Executive Officer of Ethyl, a petroleum additives company, since March 1, 1994;
having served previously as President and Chief Operating Officer of Ethyl from
1969 until March 1, 1994. Other directorships: Albemarle Corporation
("Albemarle"), Ethyl, First Colony Corporation ("First Colony"), James River
Corporation, Dominion Resources, Inc. and CSX Corporation. Term expires 1997.
FLOYD D. GOTTWALD, JR. - age 72; director since 1989; Chairman of the Board and
Chief Executive Officer of Albemarle, a chemicals company, and Vice Chairman of
Ethyl since March 1, 1994; having served previously as Chairman of the Board and
Chief Executive Officer of Ethyl from 1968 until March 1, 1994. Other
directorships: Albemarle, Ethyl and First Colony. Term expires 1996.
JOHN D. GOTTWALD - age 40; director since 1989; President and Chief Executive
Officer of Tredegar since July 10, 1989. Other directorship: Albemarle. Term
expires 1995.
ANDRE B. LACY - age 55; director since 1989; Chairman of the Board, Chief
Executive Officer and President of LDI Management, Inc. (distribution and
manufacturing holding company), and Managing General Partner of LDI, Ltd.
(industrial and investment limited partnership) since 1986. Other directorships:
Albemarle, Ethyl, IPALCO Enterprises, Inc. and Patterson Dental Company. Term
expires 1995.
EMMETT J. RICE - age 75; director since 1989; retired, former member of the
Board of Governors of the Federal Reserve System. Other directorships:
Albemarle, Ethyl, Jardine-Fleming China Region Fund and CUNA Mutual Funds. Term
expires 1995.
W. THOMAS RICE - age 82; director since 1989; retired, former Chairman and Chief
Executive Officer of Seaboard Coastline Industries, Inc. (transportation
company). Other directorship: Florida Rock Industries, Inc. Term expires 1996.
NORMAN A. SCHER - age 57; director since 1989; Executive Vice President, Chief
Financial Officer and Treasurer of Tredegar since July 10, 1989. Other
directorship: Dibrell Brothers, Incorporated. Term expires 1997.
There were five meetings of the Board held during 1994. All of the
directors, except Mr. Austin Brockenbrough, III, attended at least 75% of the
aggregate of the total number of meetings of the Board held during 1994 and the
total number of meetings held by all committees of the Board on which the
director then served. Mr. Brockenbrough, who attended 71% of the aggregate of
the total number of Board meetings and Board committee meetings on which he
served held during 1994, was unable to attend one Board meeting and the
associated meeting of the Audit Committee.
Tredegar has an Executive Committee consisting of Messrs. John D. Gottwald,
Richard W. Goodrum and Norman A. Scher. Pursuant to Tredegar's By-laws, the
Executive Committee may exercise the full authority of the Board, except as
limited by the Virginia Stock Corporation Act and except with respect to the
compensation of the executive officers, which is determined by the Executive
Compensation Committee. During 1994, the Executive Committee met formally on 11
occasions as Tredegar's principal management committee and met informally more
frequently as required.
Messrs. Andre B. Lacy, Emmett J. Rice, W. Thomas Rice and Austin
Brockenbrough, III, serve on Tredegar's Audit Committee. The Audit Committee met
on two occasions during 1994. The Audit Committee reviews Tredegar's internal
audit and financial reporting functions and the scope and results of the audit
performed by Tredegar's independent accountants and matters relating thereto and
reports thereon to the Board. The Audit Committee also recommends to the Board
the engagement of the independent accountants of Tredegar.
Ms. Phyllis Cothran and Messrs. Emmett J. Rice, James F. Miller and W.
Thomas Rice serve on Tredegar's Executive Compensation Committee. The Executive
Compensation Committee met on two occasions during 1994. This Committee approves
the salaries and bonus awards of executive officers and grants awards under
Tredegar's stock incentive plans. The Executive Compensation Committee is
composed of individuals who are not, and have not been for the preceding year,
eligible to participate in any Tredegar stock incentive plan.
Messrs. John D. Gottwald, Norman A. Scher and Andre B. Lacy serve on
Tredegar's Nominating Committee. During 1994, the Nominating Committee met
formally on one occasion. The Nominating Committee makes recommendations to the
Board regarding nominees for election as directors and may make other
recommendations regarding tenure, classification and compensation of directors.
Tredegar's By-laws provide that a shareholder of Tredegar entitled to vote
for the election of directors may nominate persons for election to the Board by
mailing written notice to the Secretary of Tredegar not later than (i) with
respect to an election to be held at an annual meeting of shareholders, 90 days
prior to such meeting and (ii) with respect to an election to be held at a
special meeting of shareholders for the election of directors, the close of
business on the seventh day following the date on which notice of such meeting
is given to shareholders. Any such shareholder's notice shall include (i) the
name and address of the shareholder and of each person to be nominated,
(ii) a representation that the shareholder is a holder of record of
stock of Tredegar entitled to vote at such meeting and intends to appear
in person or by proxy at the meeting to nominate each person specified,
(iii) a description of all arrangements or understandings between the
shareholder and each nominee and any other person (naming such person)
pursuant to which the nomination is to be made by the shareholder, (iv)
such other information regarding each nominee as would be required to be
included in a proxy statement filed pursuant to the applicable rules of
the Securities and Exchange Commission had the nominee been nominated by
the Board and (v) the consent of each nominee to serve as a director of
Tredegar if so elected.
Messrs. Floyd D. Gottwald, Jr., and Bruce C. Gottwald are brothers.
Mr. John D. Gottwald is the son of Mr. Floyd D. Gottwald, Jr. The
Gottwalds may be deemed to be control persons of Tredegar.
<PAGE>
STOCK OWNERSHIP
The following table lists the direct or indirect beneficial ownership of
Tredegar's Common Stock by the directors, nominees and the executive officers
named in the Summary Compensation Table as of February 1, 1995, and all
directors and executive officers of Tredegar as a group as of February 1, 1995.
<TABLE>
<CAPTION>
Security Ownership of Management
NUMBER OF SHARES NUMBER OF SHARES
WITH SOLE VOTING WITH SHARED VOTING TOTAL
AND INVESTMENT AND INVESTMENT NUMBER
POWER POWER OF PERCENT OF
OUTSTANDING OPTIONS(B) SHARES CLASS(a)
<S> <C> <C> <C> <C> <C>
DIRECTORS, NOMINEES AND
CERTAIN EXECUTIVE
OFFICERS(c)
Austin Brockenbrough, III 4,000 - 1,480 5,480(d)
Phyllis Cothran - - 700 700
Richard W.Goodrum 56,549 73,900 3,000 133,449 1.47%
Bruce C. Gottwald 512,026 - 46,511 558,537(e) 6.19%
Floyd D. Gottwald, Jr. 147,660 - 696,538 844,198(f) 9.35%
John D. Gottwald 297,714 97,430 194,692 589,836(g) 6.47%
Steven M. Johnson 6,742 24,111 1,500 32,353
Andre B. Lacy 223 - 63,000 63,223(h)
James F. Miller 56,000 - 1,040 57,040(i)
Emmett J. Rice 530 - - 530
W. Thomas Rice 4,000 - - 4,000
Anthony J. Rinaldi 14,984 19,611 1,357 35,952(j)
Norman A. Scher 13,318 61,611 40 74,969
MANAGEMENT
All directors
and executive officers
as a group
(16)(k)(l) 1,138,695 340,796 972,210 2,451,701(m) 26.17%(m)
</TABLE>
(a) Except as indicated, each person or group owns less than 1% of
Tredegar's outstanding Common Stock.
(b) The number of options included for the following executive
officers and Management as a group consists of options with respect to
which certain executive officers have the right to acquire beneficial
ownership within 60 days of February 1, 1995.
(c) Certain shares may be deemed to be beneficially owned by more
than one person or group listed and, except as noted in (g) below, are
reported as being beneficially owned by each.
(d) Austin Brockenbrough, III, disclaims beneficial ownership of
1,480 shares of Common Stock.
(e) Bruce C. Gottwald disclaims beneficial ownership of 46,511
shares of Common Stock.
(f) Floyd D. Gottwald, Jr., disclaims beneficial ownership of
69,621 shares of Common Stock.
(g) John D. Gottwald disclaims beneficial ownership of 71,974
shares of Common Stock. As co-trustee of a revocable trust created by
Floyd D. Gottwald, Jr., John D. Gottwald may be deemed to have shared
voting and investment power with respect to 626,917 shares which have
been reported for Floyd D. Gottwald, Jr., in the third column of the
above table.
(h) Andre B. Lacy disclaims beneficial ownership of 46,685 shares
of Common Stock.
(i) James F. Miller disclaims beneficial ownership of 1,040 shares
of Common Stock.
(j) Anthony J. Rinaldi disclaims beneficial ownership of 1,325
shares of Common Stock.
(k) The directors, nominees and executive officers have sole voting
and investment power over all of the shares disclosed except for the
shares listed in the third column, which are held by or jointly with
spouses, by children or in partnerships and certain trust relationships.
Any shares held under Ethyl's or Tredegar's benefit plans for the
benefit of any director, nominee or executive officer are included in
the number of shares over which the director, nominee or executive
officer has sole voting or investment power. Shares held by the Trustees
of such plans for the benefit of other employees are not included. See
Note (c) to the table "Security Ownership of Certain Beneficial Owners"
below.
(l) Voting and investment power is shared by two directors with
respect to 37,660 shares. This overlap in beneficial ownership has been
eliminated for purposes of calculating the number of shares and the
percentage of class owned by Management.
(m) The above table does not include certain shares owned by adult
children and attributed to Floyd D. Gottwald, Jr., and Bruce C. Gottwald
in the table "Security Ownership of Certain Beneficial Owners" below. If
such shares were included in the above table, the total number of shares
of Management would equal 3,213,529 and the percentage owned by
Management would equal 34.31%.
Based solely on its review of the copies of the forms prescribed by
Section 16(a) of the Securities Exchange Act of 1934 received by
Tredegar, or written representations from certain reporting persons that
no Forms 5 were required for those persons, Tredegar believes that all
of its Section 16 reporting persons complied with the filing
requirements of Section 16(a) as of December 31, 1994, other than
Messrs. Bruce C. Gottwald and Andre B. Lacy. Mr. Gottwald inadvertently
neglected to timely report a liquidating distribution from a trust for
the benefit of one of his sons. Mr. Gottwald subsequently reported such
distribution on Form 4. Mr. Lacy inadvertently filed late a Form 4 that
reported the disposition of shares of Tredegar that may be deemed to be
beneficially owned by him through LDI, Ltd., an entity in which Mr. Lacy
has a direct and indirect beneficial ownership interest.
The following table lists any person (including any "group" as that
term is used in Section 13(d)(3) of the Securities Exchange Act of 1934)
who, to the knowledge of Tredegar, was the beneficial owner as of
February 1, 1995, of more than 5% of the shares of Tredegar's Common
Stock.
Security Ownership of Certain Beneficial Owners
NAMES AND ADDRESSES NUMBER PERCENT
OF BENEFICIAL OWNERS OF SHARES CLASS
Floyd D. Gottwald, Jr., and
Bruce C. Gottwald(a)
330 South Fourth Street
P.O. Box 2189
Richmond, VA 23217 2,716,739(b)(c) 29.78%
Wachovia Bank of North Carolina, N.A.,
as Trustee for the Savings Plan for
the Employees of Tredegar Industries, Inc.
301 North Main Street
Winston-Salem, NC 27150 1,087,430 12.05%
(a) Floyd D. Gottwald, Jr., and Bruce C. Gottwald (the "Gottwalds"),
together with members of their immediate families, including John D. Gottwald,
who is an employee of Tredegar, may be deemed to be a "group" for purposes of
Section 13(d)(3) of the Securities Exchange Act of 1934, although there is no
agreement among them with respect to the acquisition, retention, disposition or
voting of Common Stock. The table does not name John D. Gottwald, who owns more
than 5% of the shares of Tredegar Common Stock and who, as co-trustee of a
revocable trust created by Floyd D. Gottwald, Jr., may be deemed to have shared
voting and investment power with respect to an additional 626,917 shares of
Common Stock attributed to Floyd D. Gottwald, Jr. The shares owned by John D.
Gottwald are included in the number of shares reflected in the table as being
owned by the Gottwalds as a group.
(b) The Gottwalds, individually or collectively, have sole voting and
investment power over all of the shares disclosed except for 1,430,136 shares
held by their respective wives and children, and in certain trust relationships,
some of which might be deemed to be beneficially owned by the Gottwalds under
the rules and regulations of the Securities and Exchange Commission, but as to
which the Gottwalds disclaim beneficial ownership. Shares owned by the adult
children of Floyd D. Gottwald, Jr., and Bruce C. Gottwald are included in the
holdings of the Gottwalds as a group.
(c) This amount includes shares owned of record by Wachovia Bank of North
Carolina, N.A., Winston-Salem, North Carolina ("Wachovia"), as Trustee under the
Savings Plan for the Employees of Tredegar Industries, Inc. (the "Tredegar
Savings Plan") for the benefit of certain members of the Gottwald family. This
amount does not include 1,042,070 shares held by the Trustee of the Tredegar
Savings Plan for the benefit of employees other than members of the Gottwald
family. Shares held under Tredegar's savings plan are voted by the Trustee in
accordance with instructions solicited from employees participating in the
plans. If a participating employee does not give the Trustee voting
instructions, his shares are voted by the Trustee in accordance with the Board's
recommendations to the shareholders. Because members of the Gottwald family are
executive officers, directors and the largest shareholders of Tredegar, they may
be deemed to be control persons of Tredegar and to have the capacity to control
any such recommendation of the Board.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid by Tredegar to the
Chief Executive Officer and the four other highest paid executive officers for
services in all capacities to Tredegar for the fiscal years ended December 31,
1994, 1993 and 1992, respectively.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION SECURITIES ALL OTHER
NAME AND SALARY BONUS UNDERLYING COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) OPTIONS/SARS (#) ($)
<S> <C> <C> <C> <C> <C>
John D. Gottwald 1994 333,000 90,000 37,500 16,758(1)
President and Chief 1993 322,500 42,500 -0- 16,124(1)
Executive Officer 1992 308,500 75,000 30,000(2) 10,000(3)
Richard W. Goodrum 1994 303,000 75,000 25,000 15,230(4)
Executive Vice 1993 293,250 32,500 -0- 14,662(4)
President and Chief 1992 280,625 55,000 20,000(2) 9,250(3)
Operating Officer
Norman A. Scher 1994 303,000 75,000 25,000 15,230(4)
Executive Vice 1993 293,250 32,500 -0- 14,662(4)
President, Chief 1992 280,625 55,000 20,000(2) 9,250(3)
Financial Officer and
Treasurer
Steven M. Johnson 1994 166,667 35,000 12,500 8,363(5)
Vice President - 1993 156,233 20,000 -0- 7,812(5)
Corporate Development 1992 132,975 28,000 10,000(2) 4,383(3)
Anthony J. Rinaldi 1994 156,500 36,042 12,500 7,854(6)
Vice President 1993 150,417 20,000 -0- 7,521(6)
and President of 1992 142,500 28,000 10,000(2) 4,750(3)
Films Division
</TABLE>
(1) Matching contributions under the Savings Plan for the Employees
of Tredegar Industries, Inc. (the "Savings Plan") ($7,500 for 1994 and
$10,000 for 1993) and credit under the Savings Plan Benefit Restoration
Plan (the "SPBR Plan") ($9,258 for 1994 and $6,124 for 1993).
(2) Each option granted includes a tandem stock appreciation right.
(3) For 1992, amount reflects matching contributions made by
Tredegar with respect to the executive officer under the Savings Plan.
(4) Matching contributions under the Savings Plan ($7,500 for 1994
and $10,000 for 1993) and credit under the SPBR Plan ($7,730 for 1994
and $4,662 for 1993).
(5) Matching contributions under the Savings Plan ($5,533 for 1994
and $5,812 for 1993) and credit under the SPBR Plan ($2,830 for 1994 and
$2,000 for 1993).
(6) Matching contributions under the Savings Plan ($5,200 for 1994
and $5,627 for 1993) and credit under the SPBR Plan ($2,654 for 1994 and
$1,894 for 1993).
<PAGE>
STOCK OPTIONS AND SARS
The following table sets forth information with respect to stock options
granted to each of the executive officers named in the Summary Compensation
Table during the fiscal year ended December 31, 1994. There were no SARs granted
during the fiscal year ended December 31, 1994.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
GRANT DATE
INDIVIDUAL GRANTS VALUE(1)
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS/
UNDERLYING SARS GRANTED EXERCISE OR
OPTIONS/SARS TO EMPLOYEES BASE PRICE EXPIRATION GRANT DATE
NAME GRANTED (#) IN FISCAL YEAR ($/SH) DATE PRESENT VALUE $
<S> <C> <C> <C> <C> <C>
John D. Gottwald 22,500 5.8% $15.125 2/24/2004 $146,025
15,000 3.9 24.000 2/24/2004 66,750
Richard W. Goodrum 15,000 3.9 15.125 2/24/2004 97,350
10,000 2.6 24.000 2/24/2004 44,500
Norman A. Scher 15,000 3.9 15.125 2/24/2004 97,350
10,000 2.6 24.000 2/24/2004 44,500
Steven M. Johnson 7,500 1.9 15.125 2/24/2004 48,675
5,000 1.3 24.000 2/24/2004 22,250
Anthony J. Rinaldi 7,500 1.9 15.125 2/24/2004 48,675
5,000 1.3 24.000 2/24/2004 22,250
</TABLE>
(1) The grant date present value is an estimate based on the
Black-Scholes option pricing model. The actual value, if any, an
executive may realize will depend on the excess of the stock price over
the exercise price on the date the option is exercised. There is no
assurance that the value realized by an executive will be at or near the
value estimated by the Black-Scholes model. The assumptions used under
that model include a volatility of 27.43% based on the one-year
historical volatility of Common Stock prior to the grant date, a
risk-free rate of return of 6.57% based on the ten-year zero coupon U.S.
Treasury bond yield at the time of grant, a dividend yield of 1.59%
based on the current annual dividend rate and an option term equal to
the full ten-year stated option term. The estimated grant date present
value does not reflect any discount for vesting, forfeiture provisions
or prohibitions on transfer.
The following table sets forth information with respect to the
fiscal year-end value of all unexercised stock options and SARs held by
the executive officers named in the Summary Compensation Table. None of
such executive officers exercised any Stock Options or tandem SARs
during the fiscal year ended December 31, 1994.
AGGREGATED OPTION/SAR EXERCISES
IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FISCAL YEAR-END (#) FISCAL YEAR-END ($)(1)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C>
John D. Gottwald(2) -0- -0- 59,930/39,470(3) $177,568/51,946
Richard W. Goodrum(2) -0- -0- 48,900/25,000(4) $124,377/33,750
Norman A. Scher -0- -0- 45,000/25,000(5) $121,763/33,750
Steven M. Johnson -0- -0- 17,500/12,500(6) $57,529/16,875
Anthony J. Rinaldi -0- -0- 13,000/12,500(7) $54,512/16,875
</TABLE>
(1) Based on the closing price of $17.375 on 12/30/94.
(2) The number of options and related SARs listed for Messrs.
Gottwald and Goodrum include additional options and related SARs to
purchase 6,900 and 3,900 shares of Common Stock of Tredegar,
respectively, granted as compensation for incentive stock options to
purchase shares of Ethyl Common Stock held by Messrs. Gottwald and
Goodrum that expired after the spin-off of Tredegar from Ethyl. The
6,900 options granted to Mr. Gottwald are incentive stock options and
the 3,900 options granted to Mr. Goodrum are non-incentive stock
options.
(3) Of the total 99,400 options, 61,900 include a tandem SAR.
(4) Of the total 73,900 options, 48,900 include a tandem SAR.
(5) Of the total 70,000 options, 45,000 include a tandem SAR.
(6) Of the total 30,000 options, 17,500 include a tandem SAR.
(7) Of the total 25,500 options, 13,000 include a tandem SAR.
RETIREMENT BENEFITS
All of the executive officers participate in the Tredegar
Industries, Inc. Retirement Income Plan (the "Pension Plan"). The
Pension Plan provides a normal retirement benefit equal to 1.1% of the
participant's final average earnings up to his Social Security covered
compensation, times his years of pension benefit service, plus 1.5% of
final average earnings in excess of covered compensation, times his
years of pension benefit service. There is no deduction for Social
Security benefits. Estimated annual benefits under the Pension Plan upon
retirement at age 65, determined as of December 31, 1994, to persons
with specified earnings and years of pension benefit service are set
forth in the table below.
The Internal Revenue Code limits (a) the annual retirement benefit
that may be paid under the Pension Plan and (b) the earnings that may be
used in computing a benefit. The maximum benefit and earnings
limitations are adjusted each year to reflect changes in the cost of
living. For 1994, the maximum benefit limitation was $115,452 (based on
a five-year certain and life annuity) and the earnings limitation was
$150,000.
Tredegar also maintains the Tredegar Industries, Inc. Retirement
Benefit Restoration Plan (the "Restoration Plan"). The Restoration Plan
is designed to restore to selected participants the benefits that cannot
be paid under the Pension Plan due to the Internal Revenue Code maximum
benefit limitation, the earnings limitation, or both. The benefit
payable under the Restoration Plan is the difference between the benefit
that would have been payable under the Pension Plan, but for either or
both of the Internal Revenue Code limitations, and the amount actually
payable under the Pension Plan.
PENSION PLAN TABLE
(ESTIMATED ANNUAL BENEFITS PAYABLE AT RETIREMENT)(1)(2)
<TABLE>
<CAPTION>
REMUNERATION
(FINAL-AVERAGE EARNINGS)(3) YEARS OF SERVICE(4)
10 15 20 25 30 35 40
<S> <C> <C> <C> <C> <C> <C> <C>
$125,000................ $17,778 $ 26,666 $ 35,555 $ 44,444 $ 53,333 $ 62,221 $ 71,110
150,000................ 21,528 32,291 43,055 53,819 64,583 75,346 86,110
175,000................ 25,278 37,916 50,555 63,194 75,833 88,471 101,110
200,000................ 29,028 43,541 58,055 72,569 87,083 101,596 116,110
225,000................ 32,778 49,166 65,555 81,944 98,333 114,721 131,110
250,000................ 36,528 54,791 73,055 91,319 109,583 127,846 146,110
300,000................ 44,028 66,041 88,055 110,069 132,083 154,096 176,110
350,000................ 51,528 77,291 103,055 128,819 154,583 180,346 206,110
400,000................ 59,028 88,541 118,055 147,569 177,083 206,596 236,110
450,000................ 66,528 99,791 133,055 166,319 199,583 232,846 266,110
500,000................ 74,028 111,041 148,055 185,069 222,083 259,096 296,110
</TABLE>
(1) The estimated benefits assume retirement at age 65 and assume
that payment will be made for the lifetime of the participant, with five
years' payment guaranteed, which is the normal form of payment under the
Pension Plan and the Restoration Plan. The table assumes attainment of
age 65 in 1994 and covered compensation of $24,312.
(2) The estimated benefit set forth in the table was determined
without regard to the Internal Revenue Code maximum benefit limitation
or its limitation on earnings that may be used in computing a benefit.
The Restoration Plan will provide Messrs. Gottwald, Goodrum and Scher
(currently, the only employees adversely affected by the Internal
Revenue Code limitations) the benefit that is "lost" under the Pension
Plan due to the Internal Revenue Code maximum benefit limitation. In
addition, the Restoration Plan will provide Mr. Goodrum the benefit that
is "lost" under the Pension Plan due to the Internal Revenue Code
limitation on the earnings that may be used in computing a benefit.
(3) Final-Average Earnings is the average of the highest three
consecutive calendar years' earnings (base earnings plus 50% of bonuses)
during the ten consecutive years immediately preceding the date of
determination. The current compensation covered under the Pension Plan
for each of the executive officers named in the Summary Compensation
Table and, in the case of Messrs. Gottwald, Goodrum and Scher, the
Restoration Plan, are: John D. Gottwald, $150,000; Richard W. Goodrum,
$319,250; Norman A. Scher, $150,000; Steven M. Johnson, $150,000; and
Anthony J. Rinaldi, $150,000.
(4) The years of pension benefit service for each of the executive
officers named in the Summary Compensation Table are: John D. Gottwald,
16; Richard W. Goodrum, 37.5; Norman A. Scher, 5; Steven M. Johnson, 5;
and Anthony J. Rinaldi, 18.
COMPENSATION OF DIRECTORS
Each member of the Board who was not an employee of Tredegar or any
of its subsidiaries was paid $500 for attendance at each of the four
Board meetings held in 1994 prior to September 1. Effective as of
September 1, 1994, the Board meeting fee was increased and each director
was paid $1,000 for his or her attendance at the one Board meeting held
after that date. In addition, each such director was paid $500 for
attendance at each meeting of a committee of the Board of which he or
she was a member. Each chairman of a Board committee received an
additional $250 for attendance at each meeting of his committee. In
addition, each director was paid a quarterly fee of $3,000 during 1994.
Employee members of the Board are not paid separately for their service
on the Board.
EMPLOYMENT CONTRACT WITH NORMAN A. SCHER
Tredegar has an employment agreement with Norman A. Scher,
effective until June 30, 1997, providing for an annual salary of not
less than $250,000 and the payment to him of up to two years' salary in
case of termination of employment under certain conditions and, in case
of disability, annual benefits of a specified amount. A substantial part
of such disability benefits are available under Tredegar's disability
benefit plan. In the event of Mr. Scher's death, Tredegar has agreed to
pay his estate an amount equal to two years' salary less any amounts
payable to his estate under any group insurance program of Tredegar. At
present, such benefit would be payable to Mr. Scher's estate under
Tredegar's general group insurance program supplemented by insurance
purchased by Mr. Scher.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Tredegar's Executive Compensation Committee (the "Committee") is
comprised of four independent directors. No Committee member is a
current or former employee of Tredegar or any of its subsidiaries. The
Committee's role is to review and approve practices and policies related
to compensation primarily for executive officers, including those
officers listed in this proxy statement.
COMPENSATION PHILOSOPHY
The Committee's philosophy is based on the principle that executive
compensation plans should be designed and administered to motivate and
retain highly qualified executives, with incentives linked closely to
financial performance and enhanced shareholder value. Control of all
fixed costs is critical to Tredegar's continued success. This requires a
significant portion of compensation increases to be closely linked to
performance and, therefore, variable in nature. However, Tredegar should
remain competitive with salaries.
BASE SALARIES
In determining base salaries, Tredegar identifies a reasonable
range around the average for comparable executive positions in a
comparison group of companies. Actual officer salaries are generally set
within this range based on individual performance and experience. Annual
salary increases are considered. The amount of such increases is based
on a variety of factors including average increases in comparison
companies, individual performance (evaluated subjectively), the
officer's position in the pay range, Tredegar's financial condition, and
other variable components of compensation.
The comparison company group for compensation is generally not the
same as the published industry index that appears in the performance
graph of this proxy statement because index companies are not
necessarily viewed as direct competitors for executive talent.
Comparison companies are chosen, and information on pay evaluated, with
the assistance of independent consultants.
The 1994 base salary for the Chief Executive Officer (CEO) was
$333,000. This salary is below the average for the comparison group. The
CEO's 1994 base salary was not increased during 1994. Similarly, the
Chief Financial Officer and Chief Operating Officer did not receive base
salary increases for 1994. Although the proxy statement shows an
increase in base salary for these officers, in fact, they received no
increase in 1994. The apparent inconsistency reflects the timing of the
1993 increase.
BONUSES
Although bonus awards are discretionary, the bonus portion of
compensation is tied to an assessment of performance. Some division
executives' bonuses are linked directly by formula to specific division
performance measures. In such cases, economic profit added is the most
widely used and most heavily weighted measure. In other cases, a broad
range of financial measures as well as progress on strategic issues are
reviewed.
In 1994, total bonuses paid to executive officers were
approximately double the 1993 amount, reflecting significant improvement
in relevant performance measures.
The Committee awarded the CEO a bonus of $90,000 compared to
$42,500 paid the prior year. In 1994, 21.3% of the CEO's total cash
compensation was comprised of incentive cash compensation, compared with
11.8% in 1993. Both 1994 and 1993 incentive cash percentages were
significantly below market averages.
STOCK OPTIONS
Stock options are considered an important piece of compensation at
Tredegar. As of March 1, 1995, 724 employees have stock options. Over
time the stock price reflects management's performance. Through the
options granted, management and shareholder interests are more closely
tied.
Tredegar has two stock incentive plans (collectively the "SIP").
Each year the Committee considers granting awards under the SIP to
executive officers and other employees and individuals providing
valuable services to Tredegar or its subsidiaries. Consistent with the
objective of closely aligning executives' interests with those of
Tredegar shareholders, the SIP enables the Committee to grant stock
options, stock appreciation rights ("SARs"), and shares of restricted
stock. The Committee determines the terms and conditions of any options,
SARs, or restricted stock granted.
Executive officers as a group were granted 137,500 total shares in
the form of incentive stock options on a discretionary basis in 1994.
For each grant made, 60% of the shares were priced at fair market value
on the grant date ($15.125 per share), with the remaining 40% of shares
priced at approximately 60% above fair market value ($24.00 per share).
The CEO was granted 37,500 option shares, 22,500 of which were priced at
$15.125 per share, and 15,000 of which were priced at $24.00 per share.
CORPORATE TAX CONSIDERATIONS
Congress recently passed a law, effective in 1994, that disallows
corporate tax deductions for executive compensation in excess of $1
million for "proxy table" executives. This law, covered in Internal
Revenue Code Section 162(m), allows certain exemptions to the deduction
cap, including pay programs that depend on formulas and, therefore, are
"performance-based" rather than discretionary.
While Tredegar's compensation program is discretionary, the Company
is not currently in danger of losing deductions under Code Section
162(m). The Committee will carefully review any compensation plan or
action that would result in the disallowance of compensation deductions.
The Committee will consider a variety of factors, including the amount
of any deductions that may be lost.
EXECUTIVE COMPENSATION COMMITTEE:
Emmett J. Rice, Chairman James F. Miller
Phyllis Cothran W. Thomas Rice
March 23, 1995
ADDITIONAL INFORMATION ON COMPENSATION PAID TO TREDEGAR'S EXECUTIVE
OFFICERS HAS BEEN INCLUDED IN TREDEGAR'S ANNUAL REPORT TO SHAREHOLDERS.
COMPARATIVE COMPANY PERFORMANCE
The following graph compares cumulative total returns for Tredegar,
the S&P SmallCap 600, and the S&P Manufacturing (Diversified
Industries), a nationally recognized industry index, since December 31,
1989. The comparison assumes $100 invested on December 31, 1989 and
assumes dividend reinvestment.
Tredegar used the S&P 500 as a performance measure in last year's
proxy statement, but has replaced the S&P 500 with the S&P SmallCap 600
as its broad equity market index. As required by Securities and Exchange
Commission regulations governing proxy materials, the following graph
also compares cumulative total returns for the S&P 500 Stock Index over
the same period. The S&P SmallCap 600 is made up of small-capitalization
companies, and the median market capitalization of the companies
included in the index is approximately $267 million. The median market
capitalization of the companies included in the S&P 500 is approximately
$3.6 billion. Further, Tredegar's Common Stock is included in the S&P
SmallCap 600 Stock Index. As such, Tredegar's management believes that
the S&P SmallCap 600 Stock Index is more useful than the S&P 500 Stock
Index in measuring the performance of Tredegar Common Stock.
1989 1990 1991 1992 1993 1994
TREDEGAR $100 $48 $ 66 $104 $103 $121
S&P SMALLCAP 600 100 76 113 137 163 155
S&P MFG. 100 99 122 132 160 166
S&P 500 100 97 126 136 150 152
DESIGNATION OF AUDITORS
The Board has designated Coopers & Lybrand L.L.P., certified public
accountants, as Tredegar's independent auditors for the year 1995,
subject to shareholder approval. This firm has audited Tredegar's
financial statements since Tredegar became an independent company in
1989. A representative of Coopers & Lybrand L.L.P. is expected to be
present at the meeting with an opportunity to make a statement and to be
available to respond to appropriate questions.
Coopers & Lybrand L.L.P.'s principal function is to audit the
consolidated financial statements of Tredegar and its subsidiaries and,
in connection with the audit, to review certain related filings with the
Securities and Exchange Commission and to conduct limited reviews of the
unaudited financial statements included in each of Tredegar's quarterly
reports.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE
DESIGNATION OF COOPERS & LYBRAND L.L.P. AS AUDITORS.
PROPOSALS FOR 1996 ANNUAL MEETING
Under the regulations of the Securities and Exchange Commission, any
shareholder desiring to make a proposal to be acted upon at the 1996 annual
meeting of shareholders must present such proposal to Tredegar at its principal
office in Richmond, Virginia, not later than November 28, 1995, in order for the
proposal to be considered for inclusion in Tredegar's proxy statement.
In addition to any other applicable requirements, for business to be
properly brought before the annual meeting by a shareholder, even if the
proposal is not to be included in Tredegar's proxy statement, Tredegar's By-laws
provide that the shareholder must give timely notice in writing to the Secretary
of Tredegar not later than 90 days prior to the meeting. As to each matter, the
notice must contain (i) a brief description of the business desired to be
brought before the annual meeting (including the specific proposal to be
presented) and the reasons for addressing it at the annual meeting, (ii) the
name of, record address of, and class and number of shares beneficially owned
by, the shareholder proposing such business, and (iii) any material interest of
the shareholder in such business.
ANNUAL REPORT ON FORM 10-K
TREDEGAR WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS PROXY
STATEMENT HAS BEEN DELIVERED, ON THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY
OF TREDEGAR'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31,
1994, INCLUDING THE FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES.
REQUESTS FOR SUCH COPY SHOULD BE DIRECTED TO TREDEGAR INDUSTRIES, INC., 1100
BOULDERS PARKWAY, RICHMOND, VIRGINIA, 23225, ATTENTION: CORPORATE SECRETARY.
PROVIDED WITH THE COPY OF THE FORM 10-K WILL BE A LIST OF EXHIBITS TO THE FORM
10-K, SHOWING THE COST OF EACH. ANY OF SUCH EXHIBITS WILL BE PROVIDED UPON
PAYMENT OF THE CHARGE NOTED ON THE LIST.
OTHER MATTERS
The Board is not aware of any matters to be presented for action at the
meeting other than set forth herein. However, if any other matters properly come
before the meeting, or any adjournment thereof, the person or persons voting the
proxies will vote them in accordance with their best judgment.
By Order of the Board of Directors
Nancy M. Taylor, SECRETARY
<PAGE>
NOTICE
AND
PROXY STATEMENT
FOR
ANNUAL MEETING
OF
SHAREHOLDERS
MAY 24, 1995
TREDEGAR INDUSTRIES, INC.
1100 Boulders Parkway
Richmond, Virginia 23225
<PAGE>
TREDEGAR INDUSTRIES, INC.
RICHMOND, VIRGINIA
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 24, 1995
The undersigned hereby appoints Richard W. Goodrum, Norman A. Scher and
Nancy M. Taylor, or any of them, with full power of substitution in each,
proxies (and if the undersigned is a proxy, substitute proxies) to vote all
shares of stock of Tredegar Industries, Inc. that the undersigned is entitled to
vote at the annual meeting of shareholders to be held on May 24, 1995, and at
any and all adjournments thereof:
<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY
below (except as otherwise to vote for all of the
indicated below) nominees listed below
</TABLE>
John D. Gottwald, Andre B. Lacy and Emmett J. Rice
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY OF SUCH NOMINEES WRITE THE
NOMINEE'S NAME ON THE LINE PROVIDED BELOW
2. [ ] FOR [ ] AGAINST [ ] ABSTAIN The proposal to approve the
designation of Coopers & Lybrand
L.L.P. as the auditors for
Tredegar for 1995
In their discretion, the Proxies are authorized to vote upon such other
business and matters incident to the conduct of the meeting as may
properly come before the meeting.
PLEASE SIGN AND DATE ON THE REVERSE SIDE
<PAGE>
This Proxy is solicited on behalf of the Board of Directors. This
Proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this
Proxy will be voted for Proposals 1 and 2.
Dated ________________, 1995
____________________________
Signature
Please sign name exactly as it
appears on the stock certificate.
Only one of several joint owners
need sign. Fiduciaries should give
full title.
Please MARK, SIGN, DATE AND RETURN
the Proxy Card promptly using the
enclosed envelope.
