<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/x/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
RUSSELL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/x/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[LOGO]
RUSSELL
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
RUSSELL CORPORATION
To the Shareholders of Russell Corporation:
Notice is hereby given that the Annual Meeting of the Shareholders
(the "Annual Meeting") of Russell Corporation (the "Company") will be held on
Wednesday, April 24, 1996 at 10:00 a.m., Central Time, at the general offices
of the Company in Alexander City, Alabama, for the following purposes:
(1) To elect two directors to the Board of Directors for terms of
three years each;
(2) To transact such other business as may properly come before
the meeting.
Holders of the common stock of the Company at the close of business on
March 6, 1996 are entitled to notice of and to vote upon all matters at the
Annual Meeting.
The Annual Meeting may be adjourned from time to time without notice
other than announcement at the Annual Meeting, or at any adjournment thereof,
and any business for which notice is hereby given may be transacted at any such
adjournment.
You are cordially invited to attend the Annual Meeting so that we may
have the opportunity to meet with you and discuss the affairs of the Company.
WHETHER YOU PLAN TO ATTEND THE MEETING OR NOT, PLEASE SIGN AND RETURN THE
ENCLOSED PROXY SO THAT THE COMPANY MAY BE ASSURED OF THE PRESENCE OF A QUORUM
AT THE ANNUAL MEETING. A stamped, addressed envelope is enclosed for your
convenience in returning your proxy.
By Order of The Board of Directors
Steve R. Forehand
Secretary
Russell Corporation
Alexander City, Alabama 35011
March 20, 1996
<PAGE> 3
RUSSELL CORPORATION
- --------------------------------------------------------------------------------
PROXY STATEMENT FOR THE ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD APRIL 24, 1996
- --------------------------------------------------------------------------------
This Proxy Statement is furnished by and the accompanying proxy is
solicited on behalf of the Board of Directors of Russell Corporation, an
Alabama corporation (the "Company"), for use at its Annual Meeting of
Shareholders to be held at the general offices of the Company in Alexander
City, Alabama, on Wednesday, April 24, 1996 at 10:00 a.m., Central Time, and at
any adjournment thereof (the "Annual Meeting"). It is contemplated that the
Proxy Statement and accompanying proxy will be mailed on or about March 20,
1996.
Shares represented by a properly executed proxy in the accompanying
form will be voted at the meeting and, when instructions have been given by the
shareholder, will be voted in accordance with those instructions. In the
absence of contrary instructions, the proxies received by the Board of
Directors will be voted FOR the election of all nominees for director of the
Company. A shareholder who has given a proxy may revoke it at any time prior to
its exercise by giving written notice of such revocation to the Secretary of
the Company, executing and delivering to the Company a later dated proxy
reflecting contrary instructions or appearing at the Annual Meeting and taking
appropriate steps to vote in person.
ELECTION OF DIRECTORS
The Bylaws of the Company ("Bylaws") provide for a Board of Directors
of not less than nine nor more than 15 members. In addition, the Bylaws also
provide that the Board of Directors shall set the number of Directors within
the specified limitations by resolution adopted by a majority of the entire
Board of Directors and that the Board will be divided into three classes, as
nearly equal in number as possible, each of which will serve for three years.
On February 28, 1996, a majority of the Board of Directors adopted a resolution
which established the size of the Board of Directors at ten members, effective
April 24, 1996. It is proposed to elect two directors to serve until the Annual
Meeting of Shareholders in 1999 and until their successors have been duly
elected and qualified. Proxies cannot be voted for more than two persons. It is
intended that shares represented by the Board of Directors' proxies will be
voted for the election of the following two persons:
NOMINEES TO SERVE UNTIL ANNUAL MEETING OF SHAREHOLDERS IN 1999:
<TABLE>
<CAPTION>
YEAR FIRST SHARES
NAME, AGE AND ELECTED DIRECTOR BENEFICIALLY
PRINCIPAL OCCUPATION OF THE OWNED AS OF PERCENT
OF NOMINEE COMPANY MARCH 6, 1996 OF CLASS
----------------------------- ---------------- ------------- -----------
<S> <C> <C> <C>
Herschel M. Bloom (52) 1986 5,542 .01
Partner
King & Spalding
Atlanta, Georgia
attorneys
Ronald G. Bruno (44) 1992 5,200 .01
President
Bruno Capital
Management Corporation
Birmingham, Alabama
an investment company
</TABLE>
-1-
<PAGE> 4
EACH OF THE DIRECTORS NAMED BELOW WILL CONTINUE IN OFFICE AFTER THE ANNUAL
MEETING UNTIL HIS TERM EXPIRES AS INDICATED:
<TABLE>
<CAPTION>
ANNUAL MEETING YEAR FIRST SHARES
AT WHICH ELECTED DIRECTOR BENEFICIALLY
NAME, AGE AND TERM OF THE OWNED AS OF PERCENT
PRINCIPAL OCCUPATION EXPIRES COMPANY MARCH 6, 1996 OF CLASS
- --------------------------- --------------- ---------------- ---------------- ----------
<S> <C> <C> <C> <C>
John C. Adams (57) 1997 1991 716,560 (1)(2) 1.85
Chairman, President and Chief
Executive Officer of the Company
Crawford T. Johnson III (71) 1997 1978 15,000 .04
Chairman of the Board
Coca-Cola Bottling Company
United, Inc.
Birmingham, Alabama
James D. Nabors (53) 1997 1988 1,398,758 (1)(2)(3) 3.62
Executive Vice President and
Chief Financial Officer
of the Company
Benjamin Russell (58) 1997 1963 5,890,186 (4) 15.22
Chairman and
Chief Executive Officer
Russell Lands, Incorporated
Alexander City, Alabama
a land and timber company
C.V. Nalley III (53) 1998 1989 1,000 -
Chief Executive Officer of
The Nalley Companies,
Atlanta, Georgia
automobile and truck sales
and leasing companies
John R. Thomas (59) 1998 1966 570,983 (5) 1.52
Chairman, President and
Chief Executive Officer of
Aliant National Corporation
Alexander City, Alabama
a bank holding company
John A. White (56) 1998 1992 1,650 -
Dean of Engineering
Georgia Institute of Technology
Atlanta, Georgia
Timothy A. Lewis (40) 1998 1995 100 -
President of
T.A. Lewis & Associates, Inc.
Birmingham, Alabama
telecommunications consultants
</TABLE>
(1) The shares of the Company's Common Stock owned by Messrs. Adams and
Nabors include 51,200 and 38,200 shares, respectively, which may be
acquired by them pursuant to options granted under the Company's
existing stock option plans described below, which options may be
exercised within sixty days of the date of this Proxy Statement. See
also Security Ownership of Management on page 14.
(2) Messrs. Adams and Nabors are two of the trustees of the Company's
pension plan which owns 600,960 shares of the Company's Common Stock.
As such trustees, they have the right to vote such shares. These
shares are included in the shares shown as beneficially owned by each
of such persons.
-2-
<PAGE> 5
(3) Includes 731,296 shares held by the Benjamin and Roberta Russell
Foundation, Incorporated, a charitable corporation of which Mr. Nabors
is one of seven directors, and 9,921 shares owned by the Thomas D.
Russell Marital Trust, of which Mr. Nabors is one of two trustees, as
to which shares Mr. Nabors disclaims any beneficial ownership.
(4) Includes 731,296 shares held by the Benjamin and Roberta Russell
Foundation, Incorporated, a charitable corporation of which Mr.
Russell is one of seven directors; 3,945,024 shares held by a trust
created under the will of Benjamin C. Russell, of which Mr. Russell is
one of four trustees, and 100,000 shares held by the Adelia Russell
Charitable Foundation, of which Mr. Russell is one of three trustees.
(5) Includes 116,734 shares owned directly and 454,249 shares owned
indirectly by Mr. Thomas as a general and limited partner in two
limited partnerships.
With the exceptions of John C. Adams, John A. White, Timothy A. Lewis
and Ronald G. Bruno, each of the above named persons has been a director of the
Company for at least the last five years. Except as noted in the remainder of
this paragraph, each of the above named persons has held the same or comparable
positions with the indicated entities for at least the last five years. Mr.
Adams was named Chairman, President and Chief Executive Officer of the Company
effective April 28, 1993. He had previously served as President and Chief
Executive Officer since April 22, 1992, as President and Chief Operating
Officer since May 6, 1991, as Senior Vice President, Apparel Operations of the
Company since July, 1989, and as President of the Knit Apparel Division from
1983 to 1989. Dr. White has served since July 1, 1991, as Dean of Engineering
at Georgia Institute of Technology, having been a member of the faculty since
1975. During the three years prior to 1991 he served as Assistant Director of
the National Science Foundation in Washington, D.C. through an
Intergovernmental Personnel Agreement with Georgia Tech. Mr. Bruno was elected
President of Bruno Capital Management Corporation in September, 1995. From 1991
until September, 1995, Mr. Bruno served as Chairman of the Board and Chief
Executive Officer of Bruno's, Inc. Prior to that time he had served as
President and Chief Executive Officer since 1990 and President and Chief
Operating Officer since 1986. Mr. Lewis has served since 1987 as President of
T.A. Lewis &Associates, Inc., a telecommunications consulting company. From
1983 to 1987 he served as a marketing and sales executive for Signal
Communications, a national long distance telecommunications company.
Glenn Ireland II has announced his retirement from the Board of
Directors effective at the Annual Meeting and will not stand for re-election.
John R. Thomas is a director of Alfa Corporation. Ronald G. Bruno is a
director of Bruno's, Inc., SouthTrust Bank of Alabama, N.A. and
Books-A-Million, Inc. Herschel M. Bloom is a director of Post Properties, Inc.
John C. Adams is a director of The Southern Company. John A. White is a
director of Motorola, Inc. and Eastman Chemical Company.
Should any nominee be unable or unwilling to accept election, it is
expected that the proxies will vote for the election of such other person for
the office of director as the Board of Directors of the Company may then
recommend. The Board of Directors has no reason to believe that any of the
persons named will be unable or will decline to serve if elected.
The Company has an Executive Committee consisting of John C. Adams and
James D. Nabors, which is authorized to act in place of the Board of Directors
between meetings of the Board. The Executive Committee held fourteen meetings
during 1995.
The Company has an Executive Compensation Committee consisting of
Glenn Ireland II, Crawford T. Johnson III, Ronald G. Bruno, and C.V. Nalley
III, which supervises the Company's Executive Incentive Program. The
Compensation Committee held one meeting during 1995.
The Company also has an Audit Committee consisting of Herschel M.
Bloom, Glenn Ireland II, Ronald G. Bruno, Crawford T. Johnson III, C.V. Nalley
III, John A. White, John R. Thomas, Timothy A. Lewis and Benjamin Russell,
which recommends to the Board of Directors the independent accountants selected
to be the Company's auditors and reviews the audit plan, financial statements
and audit results. The Audit Committee held two meetings during 1995.
-3-
<PAGE> 6
The Company has a Nominating Committee which recommends candidates for
election to the Company's Board of Directors. The Nominating Committee consists
of Crawford T. Johnson III, Herschel M. Bloom, Benjamin Russell, John R.
Thomas and John A. White and held one meeting in 1995.
During the year ended December 30, 1995, the Board of Directors of the
Company held four regular meetings. Each member of the Board attended at least
75% of the meetings of the Board and the committees of which they are members.
Members of the Board who are not employees or affiliates of the Company receive
a quarterly retainer of $3,750 and a fee of $1,000 for each meeting attended.
Members of the Board who are affiliates of the Company, but not employees
receive a quarterly retainer of $1,100. Members of committees of the Board who
are not employees of the Company receive $650 per quarter (except the chairman
who receives $1,300 per quarter).
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
COMPENSATION PHILOSOPHY AND OBJECTIVES
The Company's shareholders adopted the 1993 Executive Long-Term
Incentive Plan (the "1993 Plan")on April 28, 1993. The 1993 Plan is a key
component of the Executive Incentive Program (the "Program") which encompasses
all elements of compensation. The goals of the Program are to support our
overall objectives of enhancing shareholder value, maintaining and improving
our quality standards and maximizing our competitive advantage resulting from
vertical integration. This is accomplished through the following practices:
1) Hiring and retaining the caliber of executive talent needed to
manage the Company currently as well as to position it strategically for the
future. A management team that is both stable and performance-oriented, with a
focus on teamwork, is critical to our success;
2) Having a pay-for-performance philosophy throughout the Company
that integrates our compensation program with annual and long-term strategic
planning and that links incentive compensation not only to Company performance
but also to individual and overall market performance;
3) Enhancing the pay-for-performance philosophy by placing a
substantial portion of pay for senior executives "at-risk"; and
4) Establishing the proper mix of program elements to appropriately
balance our financial, quality, customer and strategic goals for both the
short-term and long-term.
The Program is designed to optimize the connection between executive
pay, corporate strategy and return to shareholders. Specifically, the Program
is intended to meet these objectives:
- Establish target awards
- Set corporate and business unit goals in concert with the
strategic planning process
- Communicate award opportunities in advance
- Focus executives' actions on appropriate needs and reward true
success
- Motivate participants
The Executive Compensation Committee (the "Committee") believes these
objectives are met by the Program.
ELEMENTS OF THE PROGRAM
The Program is comprised of the following elements:
Base salaries;
Short-term incentives; and
Long-term incentives.
The following describes the elements of the Program, as well as the
1993 Plan, in more detail.
-4-
<PAGE> 7
BASE SALARIES
The Company's practice is to target base salaries for executives at
the 50th percentile of the market. For salary comparison purposes, the "market"
includes companies in the Company's industry, in similar industries and those
with headquarters in smaller cities. The companies used for this market
analysis of compensation are different than those included in the Value Line
Apparel Index shown in the performance graph contained in this Proxy Statement.
The Committee believes the market for executive talent extends beyond the
textile and apparel industry and includes individuals whose experience includes
a manufacturing focus similar to the Company's. In addition, due to the
Company's location, the Committee does not believe market compensation amounts
for executives should be influenced by compensation at companies in areas with
higher costs of living.
During 1995, the Committee continued the program implemented in 1993
to adjust its salary administration practices, and to increase executive
salaries to market levels, over time. As reported in prior years, the Committee
concluded this program was appropriate based upon a 1992 study of pay conducted
by an independent consulting firm. In deciding the amount of specific
increases, factors such as overall responsibility, tenure, internal equity,
market levels of pay and, most importantly, job performance, are considered. No
specific weighting is assigned to these factors. Salaries for executive
officers remained slightly below the market median during 1995.
To ensure that executive salary levels continue to reflect the
Committee's philosophy, the Company intends to periodically conduct similar pay
comparisons, and did so late in 1995. The Committee believes that maintaining
competitive compensation will ensure that the Company has the executive
management expertise required for the future. Considering the entire
compensation package, the Committee believes that targeting base salaries at
the 50th percentile of the market is a key element in the overall program to
attract and retain talented executives.
SHORT-TERM INCENTIVE PLAN
The Program is designed to motivate participants to achieve
predetermined goals for Return on Assets Employed ("ROAE") and quality. The
Committee believes the Program's performance orientation represents an
improvement over other plans used in prior years. Specifically, the short-term
incentive program includes the following elements:
1) Eligible participants include not only executives but also other
employees who fulfill key roles in the Company;
2) Target awards are established at the beginning of the year to
motivate participants and guide their efforts; and
3) Cash awards that reflect ROAE, quality and individual performance
results for the year are paid after the end of the year.
The plan's financial performance measure, ROAE, is measured at the
overall level for executives in corporate staff and manufacturing positions.
For this purpose, ROAE is defined as (a) net income before taxes and interest,
divided by (b) the sum of assets used in the business.
Target awards for executive officers are based upon the median of the
competitive market (as described in "Base Salaries" above). In assigning target
awards, the relative responsibility of each position also is considered. Based
upon this, target awards for some positions may be adjusted, on a subjective
basis, to be slightly above or below market levels. Executives at the business
unit level are measured on ROAE results at the single business unit level, with
a 75% weighting. Based upon their respective business unit, the executives'
remaining 25% of the financial performance portion of the award is based either
upon overall corporate ROAE results, or upon ROAE results for a combination of
select business units.
-5-
<PAGE> 8
Target level awards are paid if the target ROAE goal is achieved. In
addition, if actual ROAE results are less than target ROAE but equal a
predetermined threshold, awards will be paid at one-half of target amounts. If
actual ROAE results are greater than target ROAE and equal or exceed a
predetermined maximum, awards will be paid at one and one-half times target
amounts. Awards for performance between these levels are made based upon an
interpolation within the range. Awards otherwise earned based upon financial
results may be adjusted up or down by a maximum of 20% (in increments of 10%),
to reflect participants' contributions toward the Company's quality goals, and
also to reflect their individual performance.
Incentive awards for all but one of the executives named in the
Summary Compensation Table in this proxy statement were based solely upon
overall corporate ROAE results. The incentive award for the other executive was
based upon both corporate and business unit ROAE results. Adjustments based upon
individual performance were made to the payouts for certain of the named
officers in accordance with the provisions of the plan.
For 1995, overall corporate ROAE performance was below the level at
which threshold awards would be paid. Based upon this, none of the named
executive officers earned awards for the portion of incentive awards based upon
corporate ROAE. ROAE results were below threshold for most business units.
However, ROAE results for the business unit under the supervision of one of the
named executive officers were slightly above target but below maximum. Payments
made to the named executives shown in the Summary Compensation Table elsewhere
in this proxy statement reflect these results.
LONG-TERM INCENTIVE PLAN
The long-term incentive element of the 1993 Plan includes a variety of
stock based performance awards. The Committee presently intends that long-term
incentives be granted in the form of stock options and, for corporate officers
only, performance units. The Committee intends to balance the short-term
incentive payments with long-term stock options and performance units to reward
executives and key employees when superior returns are provided to
shareholders.
With these elements, the Committee believes it has established a
strong link between the participants' long-term financial interests and the
long-term interests of our shareholders in the following manner:
1) Stock Options. Pay will be closely aligned with return to
shareholders since no benefit is received by participants unless the stock
price increases.
2) Performance Units. The long-term incentive element of the 1993
Plan focuses on the Company's Total Shareholder Return ("TSR"), relative to
both a broad market index (the S & P Industrials) as well as to the Company's
historical performance. TSR includes stock price increases plus dividends,
divided by beginning stock price for the period of measurement. When the
Company's TSR is at the median of the S & P Industrials, and also at a
predetermined absolute level, target awards will be paid.
Stock option grants have been a component of previous incentive
programs. Under the 1993 Plan, the Committee made grants of stock options and
performance units at competitive levels to executive officers during 1995.
Award sizes for each position were established at the median of the competitive
market described under "Base Salaries" above. The economic value of the total
long-term grants comes half from stock options and half from performance units.
The Committee worked with an independent consultant when this plan was designed
to determine these values and the resulting award sizes. In making these
grants, the Committee's intent was to make awards that were competitive with
the market on an annualized basis. For this reason, the Committee did not
consider existing stock holdings of executives, or prior grants, in deciding
the number of stock options or performance units to grant to an executive
officer. These awards are consistent with the Committee's goals for the overall
compensation program.
Payment of performance units would be made depending upon the
measurement of the Company's TSR over a three-year period, with a new
three-year period beginning each fiscal year. The primary comparison would
focus on the Company's TSR against that of the S & P Industrials Index (the
"Index"). A secondary
-6-
<PAGE> 9
comparison against the Company's historical performance could result in a
maximum reduction of 50% of awards otherwise earned. (The Committee's
determination of the amount of target awards is discussed above.) This
secondary comparison focuses on TSR for the period of measurement against the
Company's own historical performance.
Preliminary awards will be based upon comparing the Company's actual
TSR for a three-year performance period to the TSRs of each company in the
Index. If the Company's TSR ranks at the median of the Index companies, target
awards will be earned. If the Company's TSR is at a predetermined maximum
percentile (the 90th percentile), maximum awards (at two times target) will be
earned. Minimum nonzero awards, at 50% of target awards, will be earned if the
Company's TSR is at a predetermined threshold percentile (the 33rd percentile).
If the Company's TSR ranks above threshold but below median, or above median but
below maximum, awards earned for performance between points will be
interpolated on a straight-line basis.
Next, the Company's actual TSR for the three-year period will be
compared against an absolute benchmark established at the inception of the plan
determined by using the Company's historical performance and the historical
performance of the Index. If the Company's actual three-year TSR is at or above
this absolute level, the preliminary awards earned based upon the relative TSR
comparison will be paid. However, if actual TSR is below this benchmark,
preliminary awards earned may be reduced by a maximum of 50%.
By measuring relative TSR, the Committee believes this plan rewards
executives for their contributions to Company performance, isolated from broad
stock market performance. By measuring absolute TSR, the Committee believes
this plan rewards executives appropriately based upon actual returns received
by shareholders.
When the performance at each level is taken into account, the 1993
Plan provides market pay opportunities if target awards are set at market
levels. The performance factors ensure that above-market pay is only earned for
better-than-average performance and that poor performance earns below-market
pay.
As with the stock option element of the 1993 Plan, the Committee
intends to adjust awards of performance units so that total pay opportunities
for both elements are at market levels. The target percentage of compensation
represented by performance units is not intended to change annually, but it may
change periodically as the Committee makes adjustments to keep long-term pay
opportunities at market levels.
The first three-year performance cycle for the performance unit plan
included the years 1993 through 1995. Because the Company's three-year TSR was
below the 33rd percentile TSR of the Index companies, no awards were earned for
this plan cycle.
SPECIFICS OF 1995 CEO COMPENSATION
During 1995, the compensation of the Chief Executive Officer, Mr.
Adams, consisted of the following:
Base salary of $540,000 was derived by reference to executive pay at
the market companies described earlier in this report. This amount is still
below the median base salary for the market base salary for the market. Mr.
Adams' salary increase of $74,000 from 1994 to 1995 was intended to move him
closer to the market median amount. Although no one factor was weighted more
than any other by the Committee, this increase generally was based upon the
Committee's assessment of his performance during 1994 and his contributions to
the performance of the Company. In assessing Mr. Adams' performance, the
Committee considered a number of corporate performance measures, including
increase in revenue, net income, return on assets, earnings per share and stock
price performance. The Committee evaluates these factors subjectively in making
decisions about Mr. Adams' base salary.
For 1995, Mr. Adams' annual incentive target award remained at 60% of
salary, as in prior years. However, because corporate ROAE was below the
threshold performance level established, Mr. Adams received no bonus payment
for 1995 performance.
-7-
<PAGE> 10
Mr. Adams' stock option grant during 1995 was 18,000 shares. The
number of stock options granted to Mr. Adams was determined in the same manner
as stock option grants to all other executive officers. For a discussion of the
Committee's determination of the number of stock options granted to a named
executive officer, see the discussion above under the caption "Long-Term
Incentive Plan."
Mr. Adams also received a grant of performance units at a target award
level equal to 45% of base salary. The performance period over which these
units can be earned is 1995 through 1997. As noted earlier, no performance unit
awards were earned for the 1993-1995 plan cycle.
POLICY WITH RESPECT TO THE $1 MILLION DEDUCTION LIMIT
During 1993, a new section - Section 162(m) - was added to the
Internal Revenue Code that generally limits to $1 million amounts that can be
deducted for compensation paid to executives, unless certain requirements are
met. This Committee has carefully considered the impact of this new provision.
Because no executive receives pay greater than $1 million, the Committee has
concluded that no compensation amounts are nondeductible at present. The
Committee will continue to monitor the applicability of this provision to its
programs and will determine, at the appropriate time, what action it intends to
take.
Executive Compensation Committee
C.V. Nalley III, Ronald G. Bruno,
Glenn Ireland II, Crawford T. Johnson III
COMPARATIVE FIVE-YEAR TOTAL RETURNS
RUSSELL CORPORATION, S&P 500, VALUE LINE APPAREL INDEX
PERFORMANCE RESULTS THROUGH 12/31/95
[GRAPH]
VALUE OF $100 INVESTED ON 12/31/89 AT:
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Russell Corporation $100.00 $158.64 $141.10 $128.68 $144.92 $130.38
S&P 500 100.00 130.55 140.72 154.91 157.30 216.42
Value Line Apparel Index 100.00 175.16 215.29 161.90 149.46 159.99
- ---------------------------------------------------------------------------------------------------------
</TABLE>
-8-
<PAGE> 11
NOTES
1) Assumes that the value of the investment in the Company's Common Stock
and in each index was $100 on the last trading day preceding the first day of
the fifth preceding fiscal year and that all dividends were reinvested.
2) The Value Line Apparel Index presently includes: Farah, Incorporated;
Fruit of the Loom, Inc.; Garan, Incorporated; Oshkosh B'Gosh, Inc.; Hartmarx
Corporation; Kellwood Company; Liz Claiborne, Inc.; Oxford Industries, Inc.;
Phillips-Van Heusen Corporation; Tultex Corporation; VF Corporation; and the
Company.
SUMMARY COMPENSATION TABLE
The following information is furnished for the years ended December
30, 1995, December 31, 1994 and January 1, 1994 with respect to the Company's
Chief Executive Officer and each of the four other most highly compensated
executive officers of the Company during 1995 whose salary and bonus exceeded
$100,000.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
--------------------------------------- -----------------------------------
AWARDS PAYOUTS
---------------------- -------
NAME AND OTHER RESTRICTED
PRINCIPAL ANNUAL(B) STOCK OPTIONS/ LTIP ALL OTHER
POSITION YEAR SALARY BONUS(A) COMPENSATION AWARDS SAR'S PAYOUTS COMPENSATION
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John C. Adams 1995 $540,000 $ -0- $6,187 - 18,000 - -
Chairman, 1994 466,000 321,000 5,500 - 16,900 - -
President 1993 400,000 131,700 - - 14,300 - -
and CEO
James D. Nabors 1995 304,000 -0- - - 6,600 - -
Exec. V.P. 1994 286,000 147,600 - - 6,800 - -
and CFO 1993 270,000 67,900 - - 6,400 - -
JT Taunton, Jr. 1995 261,000 -0- - - 5,600 - -
Exec. V.P. - Sales 1994 221,000 114,000 - - 4,000 - -
and Marketing 1993 155,000 38,400 - - 3,100 - -
John E. Frechette 1995 245,100 85,600 - - 4,100 - -
V.P. - International 1994 202,600 72,600 - - 3,300 - -
1993 152,600 8,500 - - 2,800 - -
Thomas R. Johnson, Jr. 1995 221,000 -0- - - 4,800 - -
Exec. V.P. - 1994 192,667 90,700 - - 2,200 - -
Manufacturing 1993 139,100 27,500 - - 2,000 - -
</TABLE>
(A) Bonus payments are reported for the year in which related services
were performed.
(B) Value of personal use of aircraft.
-9-
<PAGE> 12
OPTION/SAR GRANTS IN 1995
The following information concerns grants of incentive stock options
to the named executives for the year ended December 30, 1995. No SARgrants were
made during 1995.
<TABLE>
<CAPTION>
- -------------------------INDIVIDUAL GRANTS (1)----------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF STOCK
NUMBER OF PRICE APPRECIATION
SECURITIES %OF TOTAL FOR OPTION TERM
UNDERLYING OPTIONS/SARS -------------------------
OPTIONS/SARS GRANTED EXERCISE
GRANTED TO EMPLOYEES PRICE EXPIRATION
NAME IN 1995 IN 1995 PER SHARE DATE 5% 10%
- ---------------- ------------ ------------- --------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
John C. Adams 18,000 6.46 $30.00 1/25/05 $837,717 $1,273,292
James D. Nabors 6,600 2.37 30.00 1/25/05 307,162 466,873
JT Taunton, Jr. 5,600 2.01 30.00 1/25/05 260,623 396,135
John E. Frechette 4,100 1.47 30.00 1/25/05 190,813 290,028
Thomas R. Johnson, Jr. 4,800 1.72 30.00 1/25/05 223,391 339,544
</TABLE>
(1) The stock options were granted at an exercise price equal to the fair
market value of the Company's common stock on the date of the grant.
The stock options become exercisable in full on the second anniversary
of the grant. No other instruments were granted in tandem with the
options, nor do they carry either reload or tax reimbursement
features.
AGGREGATED OPTION/SAR EXERCISES IN 1995 AND YEAR-END VALUE TABLE
The following information is furnished for the year ended December 30,
1995 with respect to the Company's Chief Executive Officer and each of the four
other most highly compensated executive officers of the Company for stock
option exercises which occurred during 1995.
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS/SARS IN-THE-MONEY OPTIONS/SARS
SHARES AT DECEMBER 30, 1995 AT DECEMBER 30, 1995 (2)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------- ----------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
John C. Adams 6,000 $66,375 51,200 37,800 $147,106 $9,900
James D. Nabors - - 38,200 13,800 206,225 3,600
JT Taunton, Jr. 6,000 $97,319 17,300 11,800 88,550 3,100
John E. Frechette - - 11,900 7,800 1,731 1,850
Thomas R. Johnson, Jr. - - 16,400 10,000 48,168 2,600
</TABLE>
(1) This amount represents the aggregate of the market value of the
Company's Common Stock at the time each option was exercised, less the
exercise price for such option.
(2) This amount represents the aggregate of the number of options
multiplied by the difference between the closing price of the
Company's Common Stock on the New York Stock Exchange, Inc. on
December 29, 1995, less the exercise price for such option.
-10-
<PAGE> 13
LONG-TERM INCENTIVE PLAN AWARDS IN 1995
The 1993 Executive Long-Term Incentive Plan provides for the award of
long-term cash incentives to officers of the Company. Performance units may be
awarded based upon achievement of target goals over a three year period.
Performance units were awarded in accordance with the following schedule:
<TABLE>
<CAPTION>
PERFORMANCE OR
NUMBER OF OTHER PERIOD ESTIMATED FUTURE PAYOUTS UNDER NON-STOCK
SHARES, UNTIL PRICE-BASED PLANS
UNITS OR MATURATION --------------------------------------------
NAME OTHER RIGHTS OR PAYOUT THRESHOLD TARGET MAXIMUM
- ----------------- ------------ ---------------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
John C. Adams 243,000 1995-1997 $60,750 $243,000 $486,000
James D. Nabors 90,900 1995-1997 22,725 90,900 181,800
JT Taunton, Jr. 78,000 1995-1997 19,500 78,000 156,000
John E. Frechette 40,840 1995-1997 10,210 40,840 81,680
Thomas R. Johnson, Jr. 66,000 1995-1997 16,500 66,000 132,000
</TABLE>
Performance units are earned based upon Company Total Shareholder
Return ("TSR") relative to a peer group, the S &PIndustrials. Threshold, target
and maximum awards are earned when TSR is at the 33rd percentile, the median
percentile or the 90th percentile of the peer group. Awards earned based upon
relative TSRperformance may be decreased by up to 50% if the Company's absolute
TSRfor the performance period is less than a predetermined level.
For further discussion of the 1993 Executive Long-Term Incentive Plan,
see the discussion above under the caption "EXECUTIVE COMPENSATION - Executive
Compensation Committee Report on Executive Compensation - Long-Term Incentive
Plan".
PENSION PLAN
Officers of the Company are covered by the Russell Corporation Revised
Pension Plan (the "Plan"), a defined benefit plan covering all employees of the
Company. The amount of contributions made by the Company to the Plan is not
reflected in the cash compensation table above, since the amount of the
contribution with respect to a specified person is not and cannot readily be
separately or individually calculated by the regular actuaries for the Plan.
Benefits under the Plan are based upon years of credited service at
retirement and upon "Final Average Earnings," which is the average base
compensation for the highest sixty consecutive months out of the final 120
months of employment. This compensation consists only of salary and excludes
any bonus and any form of contribution to other benefit plans or any other form
of compensation. Normal or delayed retirement benefits are payable upon
retirement on the first day of any month following attainment of age 65 and
continue for the life of the employee (and his spouse, if any) or in accordance
with other elections permitted by the Plan.
On January 26, 1994, the Board of Directors adopted a supplemental
retirement plan covering any participant's compensation in excess of the
limitation amount specified in Section 401 et seq., of the Internal Revenue
Code. This plan is a non-qualified plan, thereby rendering any benefits subject
to claims of general creditors and not deductible until paid.
The following table presents estimated annual benefits payable from
the Plan and the supplemental retirement plan mentioned above upon normal or
delayed retirement to participants in specified remuneration and
years-of-credited service classifications. The amounts shown assume the current
maximum social security benefit and that the participant has elected for
benefits to be payable for a single life only.
-11-
<PAGE> 14
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
5 YEAR AVERAGE ---------------------------------------------------------------------------------------------
REMUNERATION 15 20 25 30 35 40
----------------- --------- --------- -------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
$ 150,000 $ 23,612 $ 31,483 $ 39,354 $ 47,225 $ 55,096 $ 59,221
175,000 27,737 36,983 46,229 55,475 64,721 69,533
200,000 31,862 42,483 53,104 63,725 74,346 79,846
225,000 35,987 47,983 59,979 71,975 83,971 90,158
250,000 40,112 53,483 66,854 80,225 93,596 100,471
300,000 48,362 64,483 80,604 96,725 112,846 121,096
350,000 56,612 75,483 94,354 113,225 132,096 141,721
400,000 64,862 86,483 108,104 129,725 151,346 162,346
450,000 73,112 97,483 121,854 146,225 170,596 182,971
500,000 81,362 108,483 135,604 162,725 189,846 203,596
600,000 97,862 130,483 163,104 195,725 228,346 244,846
700,000 114,362 152,483 190,604 228,725 266,846 286,096
800,000 130,862 174,483 218,104 261,725 305,346 327,346
900,000 147,362 196,483 245,604 294,725 343,846 368,598
1,000,000 163,862 218,483 273,104 327,725 382,346 409,846
</TABLE>
Years of service credited under the Plan for individuals shown in the
summary compensation table on page 9 are as follows: Mr. Adams, 19 years; Mr.
Nabors, 25 years; Mr. Taunton, 20 years; Mr. Johnson, 6 years; and Mr.
Frechette, 4 years.
STOCK OPTION PLANS
The Company has previously adopted the 1978 Stock Option Plan and the
1987 Stock Option Plan (the "Stock Option Plans") pursuant to which the Company
grants to key employees of the Company either incentive stock options ("ISO's")
or nonqualified stock options ("NQSO's"). The term of the options cannot exceed
ten years from the date of grant, and the option price must equal fair market
value of the shares covered at the time of grant. No further options are
subject to being granted under the Stock Option Plans.
The 1993 Executive Long Term Incentive Plan (the "1993 Plan")
previously discussed herein is a flexible plan which will give the Executive
Compensation Committee broad discretion to fashion the terms of awards in order
to provide eligible participants with stock based incentives as the Committee
deems appropriate. It will permit the issuance of awards in a variety of forms,
including: (a) restricted stock (b) incentive stock options (c) non-qualified
stock options (d) stock appreciation rights and (e) performance share and
performance unit awards.
The 1993 Plan provides for the grant of up to 2,000,000 shares of the
Common Stock of the Company and issuance of awards under the 1993 Plan will
cease as of January 1, 2003.
OTHER MATTERS
The Board of Directors of the Company does not know at this time of
any other matters to come before the Annual Meeting.
-12-
<PAGE> 15
PRINCIPAL SHAREHOLDERS
The following table sets forth each person who, to the Company's
knowledge, had sole or shared voting or investment power over more than five
percent of the outstanding shares of Common Stock of the Company as of March 6,
1996.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
- -------------------------------- --------------------------- ----------
<S> <C> <C>
Edith L. Russell 4,686,320 shares (1) 12.11
755 Lee Street
P.O. Box 272
Alexander City, Alabama 35011-0272
Benjamin Russell 5,890,186 shares (2) 15.22
755 Lee Street
P.O. Box 272
Alexander City, Alabama 35011-0272
Roberta A. Baumgardner 8,192,246 shares (3) 21.17
755 Lee Street
P.O. Box 272
Alexander City, Alabama 35011-0272
Helen Alison 2,064,192 shares (4) 5.33
755 Lee Street
P.O. Box 272
Alexander City, Alabama 35011-0272
Nancy R. Gwaltney 4,690,016 shares (5) 12.12
755 Lee Street
P.O. Box 272
Alexander City, Alabama 35011-0272
FMR Corp. 4,701,311 shares (6) 12.15
82 Devonshire Street
Boston, Massachusetts 02109
</TABLE>
(1) Includes 10,000 shares as to which Mrs. Russell has sole voting and
investment power, and 4,676,320 shares as to which she has shared
voting and investment power consisting of 731,296 shares held by the
Benjamin and Roberta Russell Foundation, Incorporated, a charitable
corporation of which Mrs. Russell is one of seven directors, and
3,945,024 shares held of record and beneficially owned by a trust
created under the will of Benjamin C. Russell of which Mrs. Russell is
one of four trustees. The trustees of the trust created under the will
of Benjamin C. Russell can invade the corpus of the trust for the
benefit of Mrs. Russell.
(2) Includes 1,113,866 shares as to which Mr. Russell has sole voting and
investment power and 4,776,320 shares as to which he has shared voting
and investment power. See Note (4) on page 3.
-13-
<PAGE> 16
(3) Includes 1,451,734 shares as to which Mrs. Baumgardner has sole voting
and investment power and 6,740,512 shares as to which she has shared
voting and investment power, consisting of 731,296 shares held by the
Benjamin and Roberta Russell Foundation, Incorporated, a charitable
corporation of which Mrs. Baumgardner is one of seven directors,
3,945,024 shares held of record and beneficially owned by a trust
created under the will of Benjamin C. Russell of which Mrs.
Baumgardner is one of four trustees, and 2,064,192 shares held by the
estate of J. C. Alison of which Mrs. Baumgardner is one of three
co-executors.
(4) Includes 2,064,192 shares held by the estate of J. C. Alison, of which
Mrs. Alison is one of three trustees and with respect to which Mrs.
Alison has shared voting and investment power.
(5) Includes 731,296 shares held by the Benjamin and Roberta Russell
Foundation, Incorporated, a charitable corporation of which Mrs.
Gwaltney is one of seven directors; 3,945,024 shares held by a trust
created under the will of Benjamin C. Russell of which Mrs. Gwaltney
is one of four trustees; and 13,696 shares as to which Mrs. Gwaltney
has sole voting and investment power.
(6) Information contained in Schedule 13G filed with the Company on
February 14, 1996. The Schedule 13G states that FMR Corp. has sole
voting power with respect to 66,669 shares, sole dispositive power
with respect to 4,701,311 shares, and shared voting and dispositive
power respect to 0 shares.
SECURITY OWNERSHIP OF MANAGEMENT
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
-----------------------------------------
SOLE VOTING OPTIONS
AND EXERCISABLE OTHER PERCENT
INVESTMENT WITHIN BENEFICIAL OF
NAME OF INDIVIDUAL OR GROUP POWER 60 DAYS OWNERSHIP CLASS
- --------------------------- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
John C. Adams 39,016 51,200 626,344 (1)(2) 1.85
James D. Nabors 18,381 38,200 1,342,177 (2)(3) 3.62
Timothy A. Lewis 100 0 0 -
Herschel M. Bloom 5,542 0 0 .01
Glenn Ireland II 14,000 0 0 .04
Crawford T. Johnson III 15,000 0 0 .04
C.V. Nalley III 1,000 0 0 -
Ronald G. Bruno 5,200 0 0 .01
John A. White 1,650 0 0 -
John R. Thomas 116,734 0 454,249 (4) 1.48
Benjamin Russell 1,113,866 0 4,776,320 (5) 15.22
JT Taunton, Jr. 12,669 14,000 0 .07
Thomas R. Johnson, Jr. 500 15,900 0 .04
John E. Frechette 0 11,900 0 .03
All Executive Officers and Directors
as a Group (26 persons) 1,996,500 295,047 7,199,090 24.53
</TABLE>
(1) Includes 25,384 shares owned by Mr. Adams' spouse.
(2) See Note (2) on page 2.
(3) See Note (3) on page 3.
(4) See Note (5) on page 3.
(5) See Note (4) on page 3.
-14-
<PAGE> 17
COMPLIANCE WITH SECTION 16(a) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Based solely upon review of Forms 3, 4 and 5 and amendments thereto
related to the Company's most recent fiscal year, and written representations
from certain reporting persons that no Form 5 was required, the Company
believes that Edith L. Russell, John R. Thomas and W.J. Spires each had one
late Form 4 filing in 1995.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
The Company entered into a fuel supply contract with Russell Lands,
Incorporated on May 21, 1975, under which Russell Lands, Incorporated provides
sawdust, bark, shavings, chips, and other wood materials for use in the
Company's wood chip boilers. The initial term of the contract was four years,
and may be renewed by agreement of the parties from year-to-year thereafter. In
addition, the contract may be cancelled by either party during any renewal
period upon 30 days notice following the occurrence of certain specified
conditions. Benjamin Russell is Chairman, Chief Executive Officer and a
director of Russell Lands, Incorporated, and owns beneficially approximately
70% of the equity interest in such company. Management believes this contract
is in the best interest of the Company's shareholders. During the fiscal year
ended December 30, 1995, the Company paid Russell Lands, Incorporated
approximately $1,128,000 for wood materials to operate these boilers.
The Company purchased miscellaneous building materials and supplies
from Russell Do-It Center, a building supply retailer. The Company also
purchased concrete for various construction and repair projects from Area
Concrete, Inc. Russell Do-It Center is a division of and Area Concrete, Inc. is
a wholly owned subsidiary of Russell Lands, Incorporated. Benjamin Russell is
Chairman, Chief Executive Officer and a director of Russell Lands, Incorporated
and owns beneficially approximately 70% of the equity interest in such company.
Management believes these purchases to be in the best interest of the Company's
shareholders. During the fiscal year ended December 30, 1995, the Company paid
Russell Do-It Center and Area Concrete, Inc. approximately $74,000 and $70,000,
respectively, for the purchases described above.
AUDITORS
Ernst & Young LLP, independent accountants, was selected as the
Company's auditors for 1995 after having previously served in the same capacity
since 1930. Representatives of Ernst & Young will be in attendance at the
Annual Meeting and will be given the opportunity to make a statement and to
respond to appropriate questions.
PROPOSALS BY SHAREHOLDERS
The next annual meeting of shareholders is scheduled to be held on
April 23, 1997, and shareholders of the Company may submit proposals for
consideration for inclusion in the proxy statement of the Company relating to
such annual meeting of shareholders. However, in order for such proposals to be
considered for inclusion in the proxy statement of the Company relating to such
annual meeting, such proposals must be received by the Company not later than
November 21, 1996.
-15-
<PAGE> 18
GENERAL INFORMATION
The Board of Directors of the Company has fixed the close of business
on March 6, 1996, as the record date for determining the holders of the Common
Stock of the Company entitled to notice of and to vote at the Annual Meeting.
As of such date, the Company had issued and outstanding and entitled to vote at
the Annual Meeting an aggregate of 38,692,750 shares of Common Stock, each
share of which is entitled to one (1) vote on all matters to be considered at
the Annual Meeting.
As of the date of the Proxy Statement, the Board of Directors does not
intend to present, and has not been informed that any other person intends to
present, any matter for action at the Annual Meeting other than those matters
stated in the Notice of the Annual Meeting. If other matters should properly
come before the Annual Meeting, it is intended that the holders of the proxies
will act in respect thereto in accordance with their best judgment.
Pursuant to Section 10-2B-7.25 of the Code of Alabama 1975, as
amended, and the Company's bylaws, a majority of the Common Stock shares
entitled to vote, represented in person or by proxy, will constitute a quorum
at a meeting of the Shareholders. Section 10-2B-7.28 of the Code of Alabama
1975, as amended, requires that each of the nominees to be elected to the Board
of Directors receive the affirmative vote of the majority of the votes cast by
the holders of shares of Common Stock represented at the Annual Meeting as part
of the quorum. The vote for election of directors does not include shares which
abstain from voting on a matter or which are not voted on such matter by a
nominee because such nominee is not permitted to exercise discretionary voting
authority and the nominee has not received voting instructions from the
beneficial owner of such shares. Generally, brokers who act as nominees will be
permitted to exercise discretionary voting authority where they have received
no instructions in uncontested elections for directors and on certain other
matters which are not contested where the brokers have complied with Rule 451
concerning the delivery of proxy materials to beneficial owners of the
Company's Common Stock held by such brokers.
In addition to the use of the mails, proxies may be solicited by
personal interview or by telephone or telegraph. The cost of solicitation of
proxies will be borne by the Company. The Company may request brokerage houses,
nominees, custodians, and fiduciaries to forward soliciting material to the
beneficial owners of the stock held of record and will reimburse such persons
for any reasonable expense incurred in forwarding the material.
Copies of the Company's Annual Report on Form 10-K for the year ended
December 30, 1995, in form as filed with the Securities and Exchange
Commission, may be obtained from Steve R. Forehand, the Secretary of the
Company, without charge, by persons who were shareholders beneficially or of
record as of March 6, 1996.
RUSSELL CORPORATION
Steve R. Forehand
Secretary
Alexander City, Alabama
March 20, 1996
-16-
<PAGE> 19
APPENDIX A
RUSSELL CORPORATION
Alexander City, Alabama
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- APRIL 24, 1996
(This Proxy is solicited by the Board of Directors of the Company)
This undersigned shareholder of Russell Corporation (the "Company")
hereby appoints C.V. Nalley III and John A. White, and each of them, with full
power of substitution, proxies to vote the shares of stock which the
undersigned could vote if personally present at the Annual Meeting of
Shareholders of Russell Corporation to be held at the general offices of the
Company in Alexander City, Alabama, on April 24, 1996 at 10:00 a.m., Central
Time, or any adjournment thereof:
(1) ELECTION OF DIRECTORS
For the term expiring with the Annual Meeting of shareholders
in 1999:
Herschel M. Bloom, Ronald G. Bruno
<TABLE>
<S> <C>
[ ] FOR all nominees above [ ] WITHHOLD AUTHORITY
(except as marked to the contrary) to vote for all nominees above
</TABLE>
INSTRUCTION: To withhold authority to vote for an individual
nominee, write the nominee's name in the space provided below.
(over)
(2) IN THEIR DISCRETION UPON SUCH OTHER MATTERS AS MAY PROPERLY
COME BEFORE THE MEETING.
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR
ELECTION OF THE PERSONS NOMINATED BY THE BOARD OF DIRECTORS
AS DIRECTORS.
Please date and sign exactly as name appears on the envelope in which
this material was mailed. If shares are held jointly, each shareholder should
sign. Executors, administrators, trustees, etc. should use full title and, if
more than one, all should sign. If the shareholder is a corporation, please
sign full corporate name by an authorized officer.
---------------------------------------
Signature(s) of Shareholder(s)
---------------------------------------
Dated , 1996
--------------------------
