<PAGE> 1
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
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>
U.S. CAN 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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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
[USCAN LOGO]
U.S. CAN CORPORATION
900 COMMERCE DRIVE
OAK BROOK, ILLINOIS 60523
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 27, 2000
The 2000 Annual Meeting of Stockholders of U.S. Can Corporation (the
"Company") will be held on Thursday, April 27, 2000, at 10:00 a.m. (local time),
at the headquarters of the Company located at 900 Commerce Drive, Oak Brook,
Illinois, for the following purposes:
(1) To elect two directors, each to hold office for a term of three
years;
(2) To ratify the appointment of Arthur Andersen LLP as independent
certified public accountants of the Company for the year 2000; and
(3) To transact any other business which may properly be brought before
the Annual Meeting or any adjournment thereof.
Only stockholders of record as of March 3, 2000, are entitled to notice of,
and to vote at, the Annual Meeting and any adjournment thereof. For a period of
at least ten days prior to the Annual Meeting, a complete list of stockholders
entitled to vote at the Annual Meeting will be available for examination by any
stockholder, for any purpose germane to the meeting, during regular business
hours at the offices of the Company.
Whether or not you plan to attend the Annual Meeting, please vote on all
Proposals, sign and date the enclosed proxy card and return it in the reply
envelope (included in this package) as soon as possible. Following these
instructions will ensure that your shares are represented and voted in
accordance with your wishes.
IF YOU HAVE QUESTIONS, OR NEED ASSISTANCE IN VOTING YOUR SHARES CORRECTLY,
PLEASE CALL MACKENZIE PARTNERS, INC., WHICH IS ASSISTING US WITH THIS
SOLICITATION, TOLL-FREE AT (800) 322-2885.
By Order of the Board of Directors
/s/ Steven K. Sims
Steven K. Sims
Vice President,
General Counsel and Secretary
Oak Brook, Illinois
March 28, 2000
<PAGE> 3
U.S. CAN CORPORATION
900 COMMERCE DRIVE
OAK BROOK, ILLINOIS 60523
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 27, 2000
The enclosed proxy is solicited by the Board of Directors of U.S. Can
Corporation (the "Company") for use at the Annual Meeting of Stockholders to be
held on Thursday, April 27, 2000 (the "2000 Annual Meeting"). Shares of the
Company's common stock, par value $0.01 per share (the "Common Stock"),
represented by a properly executed proxy in the accompanying form, will be voted
at the Annual Meeting. The proxy may be revoked at any time before its exercise
by (i) sending written notice of revocation to Steven K. Sims, Corporate
Secretary, U.S. Can Corporation, 900 Commerce Drive, Oak Brook, Illinois, 60523,
(ii) signing and delivering a subsequently dated proxy or (iii) attending the
2000 Annual Meeting in person and giving notice of revocation to the Inspectors
of Election. This Proxy Statement and the accompanying Notice of Annual Meeting
of Stockholders and proxy card are being mailed to stockholders beginning on or
about March 28, 2000.
March 3, 2000 was the record date for the determination of stockholders
entitled to notice of, and to vote at, the 2000 Annual Meeting. On that date,
there were outstanding and entitled to vote 13,448,471 shares of Common Stock,
which is the Company's only class of outstanding voting securities. Each
stockholder is entitled to one vote for each share of Common Stock held of
record.
Two Inspectors of Election, each from Harris Trust and Savings Bank and
appointed by the Board of Directors, will determine the shares represented at
the 2000 Annual Meeting and the validity of proxies and ballots, and tabulate
the votes cast at the 2000 Annual Meeting. A plurality of the votes cast at the
2000 Annual Meeting is required for the election of directors. An affirmative
vote of a majority of the shares of Common Stock present in person or
represented by proxy and entitled to vote at the 2000 Annual Meeting is required
for approval of all other matters submitted to the stockholders for their
consideration.
Abstentions and broker non-votes will be included when determining whether
a quorum is present at the 2000 Annual Meeting. Abstentions and broker non-votes
have no effect on voting for the election of directors because neither is
considered a vote cast. An abstention has the effect of voting against a matter
where a vote of a majority of the shares present and entitled to vote is
required since an abstention is counted as a share present and entitled to vote
but is not counted as a vote for such matter. Broker non-votes have no effect
where a majority of the shares present and entitled to vote is required since
they are not counted as shares present and entitled to vote with respect to such
matter. A broker non-vote occurs when a nominee holding shares for a beneficial
owner does not vote on a particular proposal because the nominee does not have
discretionary voting power with respect to that proposal and has not received
instructions from the beneficial owner (despite voting on at least one other
proposal for which the nominee has discretionary voting power or has received
such instructions).
<PAGE> 4
PROPOSAL 1
ELECTION OF DIRECTORS
In accordance with the By-Laws of the Company, the Board of Directors has
at present fixed the number of directors constituting the Board at seven. In
accordance with the Company's Restated Certificate of Incorporation, the
directors have been divided into three classes, as nearly equal in number as is
reasonably possible. The class of directors whose term expires at the 2000
Annual Meeting consists of two persons. The Company proposes to elect two
directors, each to hold office for a term of three years and until his successor
has been duly elected and qualified. Unless otherwise instructed by the
stockholder, the persons named in the enclosed form of proxy will vote the
shares represented by such proxy for the election of the three nominees named in
this Proxy Statement.
The Company has no reason to believe that any nominee named herein will be
unavailable to serve as a director. However, if any nominee for any reason is
unable to serve or for good cause will not serve, the proxy may be voted for
such substitute nominee as the persons appointed in the proxy may in their
discretion determine. Stockholders may not cumulate their votes in the election
of directors.
The following nominees are currently directors of the Company and its
wholly owned subsidiary, United States Can Company ("U.S. Can"):
PAUL W. JONES. Paul W. Jones joined the Company as President and Chief
Executive Officer in April 1998, and was elected Chairman of the Board in July
1998. From 1989 to 1998, Mr. Jones was the President of Greenfield Industries,
Inc. ("Greenfield"). Greenfield is an international tool manufacturer. Prior to
joining Greenfield, Mr. Jones was with General Electric ("GE") for 19 years,
holding many positions. From 1988 to 1989, he served as General
Manager -- Manufacturing for GE Transportation Systems. Prior to that time, Mr.
Jones was the General Manager of GE Drives, Motor and Generator Operations. Mr.
Jones is a member of the Board of Directors of Federal Signal Corporation.
BENJAMIN F. BAILAR. Benjamin F. Bailar has served as a Director of the
Company since 1986. He is the Dean and Professor Emeritus of the Jones Graduate
School of Administration at Rice University, where he served from 1987 to 1997.
He is also a director of Dana Corporation, Smith International, Inc. and Trico
Marine Services Inc. Dean Bailar serves as Chairman of the Company's Audit
Committee and is also a member of the Compensation and Management Development
Committee.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR
THE ELECTION OF EACH OF THE NOMINEES.
2
<PAGE> 5
EXECUTIVE OFFICERS AND DIRECTORS
The following table sets forth certain information, as of February 29,
2000, with respect to each executive officer or director of the Company.
<TABLE>
<CAPTION>
NAME AGE TITLE
- ---- --- -----
<S> <C> <C>
Paul W. Jones........................ 51 Chairman of the Board, President and Chief Executive
Officer
John L. Workman...................... 48 Executive Vice President and Chief Financial Officer
J. Michael Kirk...................... 42 Executive Vice President, Corporate Marketing and
Aerosol Sales
Gillian V. N. Derbyshire............. 46 Senior Vice President and General Manger, Paint,
Plastic, Custom and General Line Operations
Roger B. Farley...................... 56 Senior Vice President, Human Resources
David R. Ford........................ 53 Senior Vice President, International, and President,
European Operations
Thomas A. Scrimo..................... 51 Senior Vice President and General Manager, Aerosol
Operations and Business Support
Peter J. Andres...................... 56 Vice President, Treasurer and Assistant Secretary
John R. McGowan...................... 58 Vice President and Controller
Larry S. Morrison.................... 46 Vice President, Operational Excellence
Emil P. Obradovich................... 53 Vice President and Chief Technical Officer
Steven K. Sims....................... 35 Vice President, General Counsel and Secretary
Calvin W. Aurand, Jr. ............... 69 Director
Benjamin F. Bailar................... 65 Director
Charles W. Gaillard.................. 59 Director
Ricardo Poma......................... 53 Director
Francisco A. Soler................... 54 Director
Louis B. Susman...................... 62 Director
</TABLE>
Each member of the Board of Directors of the Company is also a member of
the Board of Directors of U.S. Can.
The Company's Board of Directors is divided into three classes serving
staggered three-year terms. Each Director of the Company is elected at the
annual meeting at which such Director's class stands for election and serves
until the annual meeting of the Company's stockholders three years later, or
until such Director's successor is duly elected and qualified. Messrs. Bailar
and Jones are serving three-year terms expiring at the 2000 Annual Meeting;
Messrs. Aurand and Soler are serving three-year terms expiring at the 2001
Annual Meeting; and Messrs. Gaillard, Poma and Susman are serving three-year
terms expiring at the 2002 Annual Meeting.
In connection with the Company's initial public offering of Common Stock in
March 1993 (the "IPO"), the Company entered into an agreement (the "Stockholders
Agreement") with its stockholders immediately prior to the IPO pursuant to which
each of Salomon Smith Barney (successor-in-interest to Salomon Brothers Inc) and
Messrs. Poma and Soler, for so long as each of them owns beneficially at least
175,000 shares of Common Stock, has the right to submit a name to the Board of
Directors to be included in the slate of nominees for election to the Board of
Directors. Mr. Susman is Salomon Smith Barney's current director designate, and
Messrs. Poma and Soler are self-designated directors.
The Stockholders Agreement provides that, if a designee ceases to serve for
any reason, the party who submitted the name of such designee has the right to
name a successor for approval by the Board of Directors to fill the vacancy so
created, and any director so chosen shall hold office for a term expiring at the
Annual Meeting at which the term of office of the class to which such director
has been added expires, or until such director's successor has been duly elected
and qualified.
3
<PAGE> 6
BUSINESS EXPERIENCE
The following biographical information is provided, as of February 29,
2000, with respect to each person named in the management table, other than the
two nominees for election:
John L. Workman has been Executive Vice President and Chief Financial
Officer of the Company since his appointment in August 1998. Prior to his
appointment, Mr. Workman served as Executive Vice President and Chief
Restructuring Officer at Montgomery Ward Holding Corporation. Ward is one of the
nation's largest privately-held retailers. Mr. Workman joined Ward in 1984 as a
general auditor and held a variety of financial positions with Ward, including
Vice President -- Controller, Vice President -- Finance and Chief Financial
Officer. Mr. Workman was an executive officer of Ward in July 1997 when it filed
for reorganization under Chapter 11 of the Federal bankruptcy laws. Prior to
joining Ward, Mr. Workman was a partner in Main Hurdman CPAs which later merged
into KPMG.
J. Michael Kirk was appointed Executive Vice President, Marketing in
January, 1999. In February 2000, Aerosol sales were also added to his duties.
Prior to joining U.S. Can, he served as General Manager of Blank Fed Packaging
Systems for Tetra Pak, Inc., a manufacturer of beverage packaging products. He
joined Tetra Pak in 1986 as a sales manager and held a number of sales and
marketing positions. At Tetra Pak, he became General Manager of the nine-state
Southern Region of Tetra Pak and in 1996 was named General Manager of the
company's 33-state Central Region.
Gillian V. N. Derbyshire was appointed Senior Vice President, Paint,
Plastic and General Line in September 1999. In February 2000, Custom and
Specialty operations were added to Ms. Derbyshire's responsibilities. Prior to
joining U.S. Can, she served as Vice President and General Manager of American
National Can's ("ANC's") Worldwide Plastic Bottle Group, a position held from
June 1997 to September 1999. Prior to joining ANC, Ms. Derbyshire was Vice
President and General Manager of Tenneco Packaging's EZ Foil(R) Products Group
(from June 1995 to June 1997). Prior to that, Ms. Derbyshire was Vice President,
Sales and Marketing, of the Tenneco Packaging Specialty Packaging Group.
Roger B. Farley joined U.S. Can as Senior Vice President, Human Resources
in August 1998. He was elected to the same position with the Company in April
1999. Prior to joining U.S. Can, Mr. Farley was Senior Vice President, Human
Resources (July 1997 to July 1998) and Vice President, Human Resources (June
1994 to June 1997) of Greenfield. Greenfield is an international tool
manufacturer. Before joining Greenfield, Mr. Farley spent 28 years with GE in
various operating and human resources positions.
David R. Ford was appointed Senior Vice President, International of U.S.
Can and President, European Operations in November 1997. He was elected to the
same position with the Company in April 1999. From 1987 until this appointment,
Mr. Ford held a number of senior management positions with CMB Packaging Group,
a division of CarnaudMetalbox (a Crown, Cork & Seal company), including Vice
President, Eastern Europe; Vice President, European Food Can business; Regional
Vice President, Northern Europe; and Managing Director, CMB Food Can UK. Crown,
Cork & Seal is a global metal and plastic packaging company.
Thomas A. Scrimo was appointed Senior Vice President and General Manager,
Aerosol Operations and Business Support in February 2000. From August 1998 to
February 2000, Mr. Scrimo served as Vice President, Business Support Operations
of the Company. Prior to joining the Company, he served as Vice President of
Operations for Greenfield Industries, a position he held since January 1997.
Prior to that he served as Vice President of Manufacturing of Commercial Cam
Co., Wheeling, Illinois, a division of Emerson Electric Co. which manufactured
precision material handling equipment.
Peter J. Andres has served as U.S. Can's Treasurer since September 1987,
Vice President since January 1988, and Assistant Secretary since January 1990.
He has served as Vice President, Treasurer and Assistant Secretary of the
Company since January 1990. From March to August 1987, Mr. Andres served as
Director of Financial Services of U.S. Can. Prior to joining U.S. Can, Mr.
Andres held a number of financial and sales positions during his 18-year tenure
with American Can Company.
4
<PAGE> 7
John R. McGowan has served as Vice President and Controller of U.S. Can
since August 1989. He was elected to the same position with the Company in April
1999. Mr. McGowan joined U.S. Can in May 1987 and served as Vice President,
Planning for U.S. Can from September 1987 to July 1989. Prior to joining U.S.
Can, Mr. McGowan held a number of financial and management positions during his
25-year tenure with Continental Can Company ("CCC"). Mr. McGowan was employed in
CCC's general packaging operations as Division Manager, Finance from February to
May 1987 and as Division Controller from February 1982 to January 1987.
Larry S. Morrison has been Vice President, Operational Excellence since
February 2000. From 1998 to February 2000, Mr. Morrison served as Vice President
and General Manager, Custom & Specialty Products of U.S. Can. Prior to that, Mr.
Morrison served as Vice President of Manufacturing of Custom and Specialty from
July 1995 to 1998. From October 1991 to July 1995, Mr. Morrison served as
Director of Operations at U.S. Can's Hubbard, Ohio and Baltimore, Maryland
plants. Mr. Morrison was with Sherwin-Williams' container division for 10 years
prior to U.S. Can's acquisition of the division in 1983.
Emil P. Obradovich has served as Vice President and Chief Technology
Officer since February 2000. From 1996 to February 2000, Mr. Obradovich served
as Managing Director of Technical Service for U.S. Can. From 1983 to 1996, Mr.
Obradovich served as Technical Director of U.S. Can. He also spent 10 years with
Sherwin-Williams prior to the creation of U.S. Can.
Steven K. Sims has served as Vice President, General Counsel and Secretary
of the Company and U.S. Can since June 1998. Prior to his election, Mr. Sims
served as Assistant General Counsel of U.S. Can from April 1995 to May 1998.
From September 1989 to March 1995, Mr. Sims was engaged in private practice at
the Chicago-based law firm of Ross & Hardies, representing public and private
companies in corporate and securities matters and mergers and acquisitions.
Calvin W. Aurand, Jr. has served as a Director of the Company since 1995.
In April 1995, Mr. Aurand retired as Chairman of the Board of Banta Corporation
("Banta"), Menasha, Wisconsin, a printing company where he was employed for over
five years. Mr. Aurand also served as President and Chief Executive Officer of
Banta during this period. Prior to joining Banta, Mr. Aurand was President and
Chief Operating Officer of American Bank Note Company, New York; President and
Chief Executive Officer of Charles P. Young Company, New York; President and
Chief Operating Officer of Stecker-Traung-Schmidt Corporation, Detroit; and had
held key financial positions in Bemis Company, Minneapolis. Mr. Aurand is a
director of Riverside Paper Corp., Schiele Graphics Corp., and Deluxe Corp.
Charles W. Gaillard has served as a Director of the Company since 1999.
From 1995 to October 1999, Mr. Gaillard was President of General Mills. General
Mills is one of the largest consumer foods companies in the United States. Mr.
Gaillard joined General Mills in 1966 and advanced through various food
marketing management positions, becoming Executive Vice President in 1989 and
Vice Chairman in 1993. From 1989 to 1993 he was Chief Executive Officer of
Cereal Partners Worldwide, a joint venture of General Mills and Nestle, S.A. Mr.
Gaillard is a director of Whitman Corporation and Valspar Corporation.
Ricardo Poma has served as a Director of the Company since 1983. Mr. Poma
is Managing Partner and Chief Executive Officer of Grupo Poma, a family holding
company involved in automobile distribution, hotels, real estate development and
manufacturing. Mr. Poma has held this position since June 1979. Mr. Poma is also
Vice Chairman of International Bancorp of Miami, Inc.; a member of the Advisory
Board of Bain Capital, an investment fund; and President of the School for
Economics and Business, a private university in El Salvador.
Francisco A. Soler has served as a Director of the Company since 1983. Mr.
Soler is Chairman of International Bancorp of Miami, Inc., the holding company
for The International Bank of Miami, N.A., and has held this position since
1985. Mr. Soler is also President of Harbour Club Milano Spa. and a director of
various industrial and commercial companies in the United Kingdom and El
Salvador.
Louis B. Susman has served as a Director of the Company since 1998. Mr.
Susman is Vice Chairman of Investment Banking and Managing Director of Salomon
Smith Barney Inc. ("Salomon Smith Barney"). He is also a member of its
Investment Banking Management Committee, with responsibility for all Investment
5
<PAGE> 8
Banking offices outside of New York City. Prior to joining Salomon Brothers Inc
(one of the predecessors of Salomon Smith Barney) in June 1989, Mr. Susman was a
senior partner at the St. Louis-based law firm of Thompson & Mitchell. Mr.
Susman is a Director of Drury Inns and has previously served on the Boards of
the St. Louis National Baseball Club, Inc., Silver Eagle, Inc., Hasco
International, PennCorp Financial, Avery, Inc. and other publicly-held
corporations.
INFORMATION ABOUT THE BOARD OF DIRECTORS
The Board of Directors of the Company held 11 meetings in 1999. The Board
has a standing Audit Committee, Compensation and Management Development
Committee and Nominating and Corporate Governance Committee. During 1999, no
director attended fewer than 75% of the aggregate of (1) all meetings of the
Board of Directors held while he was serving as a director and (2) all meetings
of any committee held while he was a member of such committee.
Audit Committee. The Audit Committee consists of Dean Bailar (Chairman) and
Messrs. Aurand, Poma and Susman, each of whom is a non-employee director. Among
the Committee's functions are making recommendations to the Board of Directors
regarding the continued engagement of the Company's independent auditors,
reviewing with the independent auditors and the Company's financial management
the financial statements and results of the audit engagement, reviewing the
adequacy of the Company's system of internal accounting controls and reviewing
and approving audit and non-audit fees of the independent auditors. The Audit
Committee held five meetings in 1999.
Compensation and Management Development Committee. The Compensation and
Management Development Committee consists of Mr. Gaillard (Chairman) and Messrs.
Bailar and Soler, each of whom is a non-employee director. The Compensation and
Management Development Committee develops and administers the compensation
programs for the Company's executive officers and other salaried employees. The
Compensation and Management Development Committee also works with the Chief
Executive Officer in the assessment of the organization's effectiveness,
leadership depth and the development of highly valued executives and other
managers throughout the Company. The Compensation and Management Development
Committee held five meetings in 1999.
Nominating and Corporate Governance Committee. The Nominating and Corporate
Governance Committee consists of Mr. Susman (Chairman) and Messrs. Aurand and
Poma. All of the members are non-employee directors. The Nominating and
Corporate Governance Committee makes recommendations to the Board of Directors
concerning the size and composition of the Board of Directors, the
qualifications of potential new directors and the formation of a slate of
directors to stand for election at each Annual Meeting of Stockholders. The
Nominating and Corporate Governance Committee will consider Board nominees
recommended by stockholders. The Nominating and Corporate Governance Committee
also advises the Board on the Company's relations with its stockholders and all
matters concerning corporate governance to the extent these matters are not the
responsibility of other committees. The Nominating and Corporate Governance
Committee held two meetings in 1999.
COMPENSATION OF DIRECTORS
Non-employee directors of the Company receive annual retainers of $30,000
and meeting fees of $1,500 for each Board of Directors meeting attended, $1,000
for each Board Committee meeting attended, and $500 for each telephonic Board
meeting in which a director participates. Each director is reimbursed for
reasonable expenses incurred in connection with services provided as a director.
In payment of his 1999 retainer, each outside director or his designate
received, at the Director's option, an award of 1,791 restricted shares in April
1999, which will vest in April 2000 if the director is still serving on the
Board, or cash. Vesting of director restricted stock would be accelerated in the
event of certain change-in-control transactions, including but not limited to
the acquisition of 15% or more of the Company's outstanding shares of Common
Stock by a previously unaffiliated person, or a merger in which the Company is
not the surviving entity. The Company adopted a Directors Equity Plan in 1999.
Under this Plan, beginning in 2000, each director may defer all or part of his
cash fees into deferred Company Stock units, to be settled in cash or stock upon
leaving the Board.
6
<PAGE> 9
EXECUTIVE COMPENSATION
The following tables set forth information relating to (a) compensation
paid or accrued by the Company and its subsidiaries to the Chief Executive
Officer ("CEO") and each of the four most highly compensated executive officers
of the Company (other than the CEO) serving at December 31, 1999 (each, a "named
executive officer"), for services rendered to the Company and its subsidiaries
in all capacities during fiscal years 1999, 1998 and 1997 and (b) options held
by named executive officers at December 31, 1999.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
---------------------------------
AWARDS PAYOUTS
----------------------- -------
ANNUAL COMPENSATION RESTRICTED SECURITIES
------------------------------------- STOCK UNDERLYING
OTHER ANNUAL AWARDS OPTIONS/ LTIP ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION (A) SARS (#) PAYOUTS COMPENSATION
- --------------------------- ---- -------- -------- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paul W. Jones(b)............... 1999 $572,800 $830,200(c) $ 7,500 none none none $ 96,300(d)
President and Chief Executive 1998 $384,900 $643,800(c) $ 5,500 none 450,000 none $ 68,100
Officer
David R. Ford(b)(e)............ 1999 $383,000 $251,300(c) none none none none $239,116(f)
Senior Vice President, 1998 $365,100 $143,100(c) none none 28,000 none $116,600
International and President, 1997 $ 37,445 none none $255,000 none none none
European Operations
John L. Workman(b)............. 1999 $378,600 $270,700(c) $ 7,500 none none none $ 54,100(d)
Executive Vice President and 1998 $119,600 $165,000(c) $ 2,900 none 117,750 none $ 2,200
Chief Financial Officer
Roger B. Farley(b)............. 1999 $224,000 $155,900(c) $ 7,500 none none none $ 31,400(d)
Senior Vice President, 1998 $ 82,900 $125,000(c) $ 2,900 none 94,000 none $ 2,300
Human Resources
Frank J. Galvin(b)............. 1999 $343,300 $185,600(c) $ 10,400 none none none $ 55,700(d)
Former Executive Vice 1998 $331,500 $118,300(c) $ 10,400 none 14,000 none $ 67,400
President and General Manager, 1997 $315,000 none $ 9,800 none none none $ 52,300
Aerosol Products
</TABLE>
- -------------------------
(a) On December 31, 1999, Mr. Galvin held 30,000 shares of restricted Common
Stock having a market value, based on the closing price of the Common Stock
on the last trading date in 1999, of $596,250. Mr. Ford would be entitled
to receive dividends, if any, on the shares of Common Stock underlying the
restricted stock award shown in this column.
(b) Mr. Jones joined the Company in April 1998. Mr. Ford joined the Company in
November 1997. Messrs. Workman and Farley each joined the Company in August
1998. Mr. Galvin retired as Executive Vice President and General Manager,
Aerosol Products in February 2000.
(c) The 1998 amounts for Messrs. Jones, Workman and Farley consist of a signing
or make-whole bonus (based on foregone bonus from their previous employers)
and a guaranteed partial year 1998 incentive payout. Mr. Jones' 1998 bonus
amount has been restated to reflect the final amount awarded to him under
the 1998 Management Incentive Plan, a change of $25,000. For 1998 and 1999,
the amounts shown for all of these officers include the dollar value of
additional deferred stock units provided by the Company to the named
executive officers in connection with their deferral of a portion of their
1998 and 1999 bonuses into deferred stock units under the Company's
Executive Deferred Compensation Plan. Under this Plan, eligible executives
may defer up to 25% of their annual incentive compensation into deferred
Company stock units, to be settled in cash or stock upon separation from
service. The Company contributes one additional deferred stock unit for
each five deferred stock units elected by the executive.
(d) The 1999 amounts shown for Messrs. Jones and Farley include the cost of
life insurance in excess of the Company's standard benefit ($5,800 and
$4,400, respectively). The 1999 amounts shown for Messrs. Jones, Workman,
Farley and Galvin include contributions or payments for their benefit to
7
<PAGE> 10
U.S. Can's Salaried Employee Savings and Retirement Accumulation Plan
("SRAP") and pursuant to nonqualified retirement plans ($90,500, $54,100,
$27,000 and $55,700, respectively).
(e) Mr. Ford is compensated in British Pounds. Certain amounts shown for Mr.
Ford have been converted to U.S. Dollars at the exchange rate in effect as
of the calendar year-end for the year in which payment was made.
(f) The 1999 amount shown consists of contributions to an executive retirement
plan and an overseas employee benefit trust, of which Mr. Ford is the
beneficiary, designed to provide contractual retirement benefits ($229,424)
and the cost of life insurance ($9,692).
AGGREGATED OPTION/SAR EXERCISES IN 1999 AND 1999-END OPTION/SAR VALUES
No shares were acquired, nor value realized, as a result of option
exercises by the named executive officers during 1999. The Company has not
awarded any stock appreciation rights ("SARs").
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF
UNEXERCISED UNEXERCISED
OPTIONS/SARS IN-THE-MONEY
AT 1999-END(#) OPTIONS/SARS AT 1999-END($)(A)
-------------------- ------------------------------
EXERCISABLE/ EXERCISABLE/
NAME UNEXERCISABLE UNEXERCISABLE
- ---- -------------------- ------------------------------
<S> <C> <C>
Paul W. Jones(b)............................... 216,667/233,333 $497,564/$449,999
David R. Ford.................................. 9,334/18,666 $ 35,003/$ 69,998
John L. Workman................................ 51,750/66,000 $183,744/$253,750
Roger B. Farley................................ 43,334/50,666 $148,690/$194,998
Frank J. Galvin................................ 84,667/9,333 $747,501/$ 34,999
</TABLE>
- -------------------------
(a) This amount is the aggregate of the number of in-the-money options
multiplied by the difference between the closing price of the Common Stock
on the New York Stock Exchange on December 31, 1999 (the last trading
session in 1999) and the exercise price for that option.
(b) Mr. Jones was granted 300,000 options in 1998 which were granted as
incentive stock options to the maximum extent permitted by the Internal
Revenue Code. At the time Mr. Jones exercises the portion of these options
which are not incentive stock options (283,563), the Company has agreed to
make an additional payment to him in an amount sufficient, on a net,
after-tax basis, to compensate him for the difference between the actual
tax treatment to him of the exercise of these options and the tax treatment
that would have occurred had he received all incentive stock options.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
Paul W. Jones
The Company entered into a three-year employment agreement with Mr. Jones,
beginning in April 1998. Under the terms of Mr. Jones' employment agreement, Mr.
Jones will be paid an annual base salary of at least $575,000 per annum. His
base salary and other compensation will be reviewed annually by the Compensation
and Management Development Committee of the Board of Directors. The Company has
also agreed to provide Mr. Jones with group term life insurance in the amount of
$2,000,000, an automobile allowance and employee benefits comparable to those
provided to other senior executives of the Company.
In the event of Mr. Jones' death or permanent disability or a change of
control of the Company, or if the Board of Directors terminates his employment
as Chief Executive Officer of the Company for any reason other than cause, the
initial 300,000 options granted to him will vest automatically. In the event of
the termination of Mr. Jones' employment with the Company due to his death or
permanent disability, the Company has agreed to pay him or his estate an amount
equal to one year's base salary. In the event Mr. Jones' employment is
terminated by the Company without cause, he shall receive his base salary and
8
<PAGE> 11
benefits for the remainder of the term of his employment agreement or 18 months,
whichever is longer, and he will receive a bonus prorated to reflect any partial
year of employment if, at the end of that year, it is determined that the
minimum bonus target has been met or exceeded. If Mr. Jones' employment
agreement is terminated for cause, he will receive no further compensation. In
the event that there is a change of control of the Company and within two years
of that change of control Mr. Jones resigns because he suffers a material
diminution in salary, benefits or responsibilities or is required to relocate
more than 50 miles from Oak Brook, Illinois ("Resignation for Cause"), he will
be entitled to the same compensation as if his employment were terminated
without cause. If the total value of his compensation treated as contingent on
any change of control exceeds the threshold specified under Section 280G(b) of
the Internal Revenue Code beyond which a portion of such benefits are considered
an excess parachute payment, he will be reimbursed in an amount such that the
total value of such compensation, net of all applicable taxes, would be the same
as if no excise tax under 4999(a) of the Code were payable in respect to such
excess parachute payment.
David R. Ford
U.S. Can, through its wholly owned subsidiary, USC Holding UK Limited (as
employer), has entered into a service agreement with Mr. Ford. The service
agreement will continue in effect until terminated by the employer or Mr. Ford,
but not beyond Mr. Ford's attainment of the employer's retirement age (currently
65). The employer has agreed to pay Mr. Ford a base salary of L232,000 per year
during the term of his agreement and to provide him retirement benefits no less
beneficial than those provided by his previous employer. He also receives an
employer-provided automobile. The employer has agreed to provide a target bonus
for Mr. Ford of 50% of base salary with the actual amount determined based upon
the attainment of pre-established performance goals. Mr. Ford's employment under
the agreement may be terminated by him, with 12 months advance notice to the
employer, and by the employer, with 24 months notice to Mr. Ford (except the
employer may terminate Mr. Ford's employment for cause without prior notice).
After termination notice is given and prior to expiration of the notice period,
the employer is required to continue to pay Mr. Ford's salary and provide other
contractual benefits, and Mr. Ford continues to be bound by the agreement. If
Mr. Ford's employment is terminated by reason of redundancy, the employer is
required to make an additional payment to Mr. Ford equal to two times Mr. Ford's
entitlement to statutory redundancy pay (to include the statutory entitlement).
The service agreement requires Mr. Ford to refrain from disclosing confidential
information acquired in connection with his employment with the employer, and
also requires Mr. Ford to refrain from working for any other firm during the
term of the agreement.
John L. Workman and Roger B. Farley
The Company entered into two-year employment agreements with Messrs.
Workman and Farley beginning in January and February 2000, respectively.
Following expiration of his employment agreement, each of them would be included
in the Company's Executive Severance Plan, as described later in this section.
If, during the term, a change in control (as defined in their change-in-control
agreements) occurs with respect to the Company, these employment agreements
would terminate and the terms of their employment would be governed by the
change-in-control agreements, as described later in this section. Messrs.
Workman and Farley have each entered into two-year covenants-not-to-compete in
their geographic areas of management responsibility.
Under the employment agreements, Messrs. Workman and Farley will be paid an
annual base salary of at least $375,000 and $216,000 per annum, respectively,
and will participate in the Company's Management Incentive Plan with an
opportunity for an incentive payment of at least 50% of their base salary. The
Company has agreed, upon the death or disability of either executive, to pay to
the executive or his estate (i) salary continuance for 12 months, less any
amount received from any life or disability insurance maintained by the Company
and (ii) a performance bonus based on the executive's performance during the
applicable performance period, reduced pro-rata for the portion of such period
in which he was not employed. If either executive should be terminated by the
Company without cause or leave for good reason, the Company has agreed (i) to
continue to make salary payments for 18 months after the date of such
termination, (ii) to pay a performance bonus based on the executive's
performance during the applicable performance period, reduced
9
<PAGE> 12
pro-rata for the portion of such period in which he was not employed, and (iii)
to continue to vest any unexercisable options held by him for 18 months after
the date of such termination. Good reason includes, among other things, a
material demotion, relocation on terms causing unreasonable hardship or a
reduction in salary.
Other Change-in-Control Arrangements
AGREEMENTS
The Company has entered into a change-in-control agreement with Mr. Ford
which provides certain benefits to him if he is terminated or constructively
terminated within two years following a change in control. A change in control
is defined as the acquisition by any person or group of 15% or more of the
Common Stock, a merger or consolidation in which the Company does not survive as
an independent company, a sale of all or substantially all of the assets of the
Company or the liquidation or dissolution of the Company. Under this agreement,
he is deemed to have been constructively terminated if he is assigned any duties
inconsistent in any material respect with his duties before a change in control,
or the Company takes any other action which results in a diminution in any
material respect of his position, authority, duties or responsibilities that
were in effect before a change in control. The change-in-control agreement with
Mr. Ford provides that, if he is terminated or constructively terminated within
two years following a change in control, he will receive severance pay equal to
two times the greater of his base salary then in effect or his base salary in
effect before the change in control; he will receive a pro-rated bonus for the
year in which terminated or constructively terminated based upon the actual
number of days he worked; and he will continue to receive the same health and
welfare benefits he received at any time within 120 days of the change in
control for two years following the date of such termination.
The Company has entered into change-in-control agreements with Messrs.
Workman and Farley which provide them certain benefits if they are terminated or
constructively terminated within two years following a change in control. A
change in control is defined as (i) the acquisition by any person or group of
30% or more of the common stock of the Company, (ii) a merger or consolidation
in which the Company does not survive as an independent public company, (iii) a
sale of all or substantially all of the assets of the Company, (iv) the
liquidation or dissolution of the Company or (v) a change, during any two-year
period, in a majority of the members of the Company's Board of Directors, unless
the election of each new director was approved by two-thirds of the directors in
office at the beginning of the period. Upon a change in control, any options
held by Messrs. Workman or Farley that are not exercisable would become
exercisable. These agreements provide that, if Messrs. Workman or Farley are
terminated or constructively terminated within two years following a change in
control, he would receive a severance payment equal to 18 months' salary and a
bonus based on the Company's performance during the year he leaves. Under the
agreements, Messrs. Workman or Farley would be constructively terminated if (i)
he is assigned duties, responsibilities or status inconsistent with those in
effect before a change in control, (ii) his salary is reduced, or (iii) he is
relocated to an office more than 50 miles from his office prior to a change in
control.
OPTION GRANTS
The unvested portion of the options granted to the named executive officers
may vest upon the occurrence of one or more of the following events: (i) a
change of control of the Company or upon termination or constructive termination
of the named executive officer within two years following a change of control,
and (ii) upon termination of the named executive officer's employment for
reasons other than cause.
EXECUTIVE DEFERRED COMPENSATION PLAN
The Company maintains an Executive Deferred Compensation Plan. Under this
Plan, eligible executives may defer up to 25% of their annual incentive
compensation into deferred Company stock units, to be settled in cash or stock
upon separation from service. The Company contributes one additional deferred
stock unit for each five deferred stock units elected by the executive. These
additional units vest after five years service or, if
10
<PAGE> 13
earlier, upon a change of control of the Company or the end of the executive's
employment for reasons other than termination for cause.
Executive Severance Plan
The Company maintains an Executive Severance Plan. The Compensation and
Management Development Committee of the Board of Directors or CEO, acting within
the parameters set by the Committee, designates those executives eligible to
participate. The Plan provides salary continuation for 12 to 18 months after the
termination of the participant's employment with the company if the participant
is terminated without cause or terminates his or her employment for good reason.
Good reason includes demotion, reduction in salary, certain relocations and
elimination of participation in the Plan.
Frank J. Galvin
In connection with Mr. Galvin's retirement, the Company and Mr. Galvin
entered into a separation agreement in January 2000. Under the agreement, the
Company has agreed (i) to continue to pay Mr. Galvin's base salary for two years
after the date of his retirement, (ii) to pay to Mr. Galvin a lump sum in the
amount of $170,000 on each of the second and third anniversaries of Mr. Galvin's
retirement and (iii) to accelerate the vesting of 30,000 restricted shares and
9,333 stock options held by Mr. Galvin on the date of his retirement. Mr. Galvin
has agreed (i) to provide consulting services to the Company after his
retirement, (ii) not to compete with the Company or solicit the customers or
employees of the Company for four years after his retirement and (iii) not to
use or disclose certain proprietary or confidential information regarding the
Company.
REPORT OF THE COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE
The Compensation and Management Development Committee of the Board of
Directors (the "Committee") is composed entirely of directors who have never
served as officers of the Company. Among other things, the Committee develops
and administers the compensation programs for the Company's executive officers
and other managers. Generally, the Committee approves the salary and bonus of,
and option awards to, executives.
Compensation Philosophy. The goals of the Company's compensation programs
are to relate total compensation for key management to the achievement of short-
and long-term corporate goals and objectives; to align executive officers'
financial interests with those of shareholders to a significant degree; and to
attract and retain key managers and to provide fair compensation for the
responsibilities undertaken. These goals are met through a combination of
salary, annual incentive compensation, stock options and other benefits. In
evaluating the Company's compensation and benefit programs, the Committee has
from time to time employed the services of an outside compensation consultant.
1999 Programs. During 1999 the Committee focused on two measures of the
Company's performance -- operating income and Shareholder Value Added
("SVA") -- in determining incentive payouts to senior management, other than
executives hired in 1999 (who received contractual bonus payments as an
inducement to join the Company). SVA is a decision-making and compensation model
that measures changes in the relationship between net operating profit after-tax
and capital employed in the business. Bonuses for executive officers are a
function of the Company's performance relative to targeted operating income and
improvement in SVA. In addition, all executive officers are eligible for stock
option grants under the Company's 1999 Equity Incentive Plan (the "1999 EIP").
During 1999, the Committee approved salary adjustments for the executive
officers, established targets and funding levels for the 1999 Management
Incentive Plan and approved 1998 bonus awards to executive officers and other
senior managers. Generally, in the fourth quarter of each year preceding a new
plan year, the Committee establishes certain targets for operating income and
improvement in SVA. Bonus awards are dependent upon the degree to which targets
are achieved and performance appraisals. Bonuses were awarded to all executive
officers for 1999 based upon contractual commitments, in the case of executives
hired in 1999,
11
<PAGE> 14
and based upon the achievement of substantially more than the targeted
objectives, in the case of other executive officers.
The Company also maintains an Executive Deferred Compensation Plan. Under
this Plan, eligible executives may defer up to 25% of their annual incentive
compensation into deferred Company stock units, to be settled in cash or stock
upon separation from service. The Company contributes one additional deferred
stock unit for each five deferred stock units elected by the executive. These
additional units vest after five years service or, if earlier, upon a change of
control of the Company or the end of the executive's employment for reasons
other than cause. In 1999, all eligible executives participated in this Plan,
most to the maximum extent possible.
A number of options were granted to executives hired in 1999 to induce them
to join the Company. These grants consisted primarily of options which vest
based upon the achievement of certain stock price hurdles, with a smaller
portion being matching grants (which are immediately exercisable) based upon the
hired executives' personal purchases of Common Stock. In determining the size of
option grants, the Company's directors consider the dilutive effect on
shareholders, the alignment of executives' interests with those of shareholders
and the value of the options as part of the recipient's total compensation.
As of February 29, 2000, approximately 686,000 shares were available for
award under the 1999 EIP. The primary purpose of the 1999 EIP is to allow the
grant of stock options to management of the Company, including executives, which
vest upon the achievement of certain Common Stock price hurdles. Under this
vesting schedule, 30% of the options granted vest following any ten-consecutive
day period in which each closing price of the Common Stock equals or exceeds
110% of the market price on the grant date, an additional 30% of the options
vest following any ten-consecutive day period in which each closing price of the
Common Stock equals or exceeds 125% of the market price on the grant date and
the remaining 40% vest following any ten-consecutive day period in which each
closing price of the Common Stock equals or exceeds 150% of the market price on
the grant date. Any unvested portion of the options would also vest after seven
years' service. It is the Committee's intention to make annual grants of these
stock price-based options to key executives and employees. The amount of options
awarded to each participant is based on a multiple of then current salary or the
Black-Scholes model. Grants are also made to new hires with Committee approval.
Chief Executive Officer Compensation. Utilizing the services of an outside
compensation consultant, the Board approved and the Company entered into a
three-year contract with Mr. Jones, effective April 1, 1998. Mr. Jones' base
annual compensation was determined based upon the responsibilities of his
position, restructuring and performance-related work to be accomplished and the
salary provided to chief executives of comparable companies (although no
percentile range of comparable pay was targeted). Mr. Jones' 1999 incentive
bonus was approved and paid in an amount equivalent to 137.5% of Mr. Jones' base
salary at December 31, 1999, based upon the Company substantially exceeding its
predetermined operating income and SVA targets for 1999. The Company has
established a bonus plan for Mr. Jones in 2000 that will pay a bonus equal to
100% of his base pay upon the achievement of the annual operating income and SVA
targets set by the Compensation and Management Development Committee, with
greater amounts for exceeding those targets and appropriate reductions for
results comprising a substantial amount of, but lower than, target. For a more
detailed description of Mr. Jones' employment agreement, see "Employment
Contracts, Termination of Employment and Change-in-Control Arrangements -- Paul
W. Jones" included elsewhere in this statement.
12
<PAGE> 15
Tax Considerations. To the extent readily determinable and as one of the
factors in its consideration of compensation matters, the Committee considers
the anticipated tax treatment to the Company and to the executive officers of
various payments and benefits. Some types of compensation and their
deductibility (e.g., the spread on exercise of non-qualified options) depend
upon the timing of an executive officer's vesting or exercise of previously
granted rights. Interpretations of and changes in the tax laws and other factors
also affect the deductibility of compensation. For these and other reasons, the
Committee will not necessarily and in all circumstances limit executive
compensation to the amount deductible under Section 162(m) of the Internal
Revenue Code. In connection with Mr. Jones' employment agreement, the Company
has agreed to gross-up certain payments following a change of control which
could be treated as excess parachute payments under the Code, so that Mr. Jones'
after-tax payment is equivalent to the amount otherwise payable if no excess
parachute payment-related excise tax applied. The Company's ability to deduct
all or a portion of any payments to Mr. Jones which are treated as excess
parachute payments under the Code would be adversely affected under these
circumstances.
Compensation and Management Development Committee
Charles W. Gaillard, Chairman
Benjamin F. Bailar
Francisco A. Soler
PERFORMANCE GRAPH
The following graph shows the changes in the value of $100 invested since
December 31, 1994, in (i) the Common Stock, (ii) the Center for Research in
Security Prices ("CRSP") at the University of Chicago Graduate School of
Business' Total Return Index for the NYSE Stock Market (U.S. Companies) and
(iii) the Company's self-determined peer group, assuming that all dividends were
reinvested.
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
NYSE STOCK MARKET (US SELF-DETERMINED PEER
U.S. CAN CORPORATION COMPANIES) GROUP
-------------------- --------------------- --------------------
<S> <C> <C> <C>
12/1994 100.00 100.00 100.00
12/1995 71.10 135.60 106.00
12/1996 88.80 164.40 134.40
12/1997 88.80 218.40 139.50
12/1998 94.10 262.00 105.40
12/1999 104.60 287.20 80.40
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
12/30/1994 12/29/1995 12/31/1996 12/31/1997 12/31/1998 12/31/1999
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
U.S. Can Corporation $100.0 $ 71.1 $ 88.8 $ 88.8 $ 94.1 $104.6
NYSE (U.S. Companies)(1) 100.0 135.6 164.4 218.4 262.0 287.2
Peer Group(2) 100.0 106.0 134.4 139.5 105.4 80.4
</TABLE>
(1) The Total Return Index for the NYSE Stock Market (U.S. Companies) is an
index compiled by CRSP.
(2) The peer group is comprised of Crown Cork & Seal Company, Inc., Ball
Corporation, Silgan Holdings Inc., CLARCOR Inc. and BWAY Corp.
13
<PAGE> 16
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of February 29, 2000 (unless otherwise
indicated), the number and percentage of shares of Common Stock beneficially
owned by (i) each person known by the Company to own beneficially more than 5%
of the outstanding shares of Common Stock, (ii) each director or director
nominee of the Company, (iii) each named executive officer and (iv) all
directors and executive officers of the Company as a group, with sole voting and
investment power (unless otherwise indicated).
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
BENEFICIALLY OWNED
----------------------
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER PERCENT
- ------------------------------------ --------- -------
<S> <C> <C>
Salomon Smith Barney Inc., Salomon.......................... 1,417,233(1) 10.54%
Brothers Holding Company Inc., Salomon
Smith Barney Holdings Inc.
388 Greenwich Street
New York, NY 10013
and
Citigroup Inc.
153 East 53rd Street
New York, New York 10043
President and Fellows of Harvard College,................... 1,390,500(2) 10.34%
John Stevens Trust, Nancy Stevens Trust, and
Harvard College Trust
c/o Harvard Management Company, Inc.
600 Atlantic Avenue
Boston, MA 02210
and
Harvard Master Trust
1350 Massachusetts Avenue
Holyoke Center, Room 340
Cambridge, MA 02138
T. Rowe Price Associates, Inc. and.......................... 1,343,100(3) 9.99%
T. Rowe Price Small-Cap Stock Fund, Inc.
100 E. Pratt Street
Baltimore, Maryland 21202
Ricardo Poma................................................ 920,133(4) 6.84%
Lomas de San Francisco
San Salvador, El Salvador
Mellon Financial Corporation,............................... 810,097(5) 6.02%
Mellon Bank N.A. and
The Dreyfus Corporation
One Mellon Center
Pittsburgh, Pennsylvania 15258
Woodland Partners LLC....................................... 806,200(6) 5.99%
60 South Sixth Street, Suite 3750
Minneapolis, Minnesota 55402
Frontier Capital Management Co., Inc........................ 707,340(7) 5.26%
99 Summer Street
Boston, MA 02110
Francisco A. Soler.......................................... 469,233(8) 3.49%
Calvin W. Aurand, Jr........................................ 3,633 *
Benjamin F. Bailar.......................................... 37,133(9) *
Charles W. Gaillard......................................... 2,791 *
Louis B. Susman............................................. 3,000 *
Paul W. Jones............................................... 250,667(10) 1.83%
John L. Workman............................................. 61,250(11) *
Roger B. Farley............................................. 49,334(12) *
David R. Ford............................................... 24,334(13) *
Frank J. Galvin............................................. 159,823(14) 1.17%
All directors and executive officers as a group............. 2,005,207(15) 14.42%
</TABLE>
14
<PAGE> 17
- -------------------------
* The percentage of shares beneficially owned does not exceed 1% of the Common
Stock.
(1) Salomon Smith Barney Inc. and Salomon Brothers Holding Company Inc. each
own beneficially 1,407,133 of these shares. Salomon Smith Barney Holdings
Inc. and Citigroup Inc. each own 1,417,233 of these shares. Each of Salomon
Smith Barney Inc., Salomon Brothers Holding Company Inc., Salomon Smith
Barney Holdings Inc. and Citigroup Inc. reported shared voting and
dispositive power for these shares. Salomon Smith Barney Holdings Inc. and
Citigroup Inc. disclaim beneficial ownership of these shares.
(2) President and Fellows of Harvard College owns beneficially 1,352,500 of
these shares, the Harvard Master Trust owns beneficially 35,300 of these
shares, the John Stevens Trust owns beneficially 300 of these shares, the
Nancy Stevens Trust owns beneficially 1,000 of these shares and the Harvard
College Trust owns beneficially 1,400 of these shares.
(3) T. Rowe Price Associates, Inc. has sole voting power over 257,900 of these
shares and sole dispositive power over 1,343,100 of these shares. T. Rowe
Price Small-Cap Stock Fund, Inc. has sole voting power over 1,035,000 of
these shares. These securities are owned by various institutional investors
including T. Rowe Price Small Cap Stock Fund, Inc. (which owns 1,035,000
shares, representing 7.70% of the shares outstanding as of February 29,
2000), which T. Rowe Price Associates, Inc. serves as investment adviser
with power to direct investments and/or sole power to vote the securities.
For purposes of the reporting requirements of the Securities Exchange Act
of 1934, T. T. Rowe Price Associates, Inc. is deemed to be a beneficial
owner of such securities; however, T. Rowe Price Associates, Inc. expressly
disclaims that it is, in fact, a beneficial owner of such securities.
(4) Salcorp Ltd. ("Salcorp") is the record holder of 340,000 of these shares
and Katsura, S.A. ("Katsura") is the record holder of 60,000 of these
shares. Mr. Poma is the sole stockholder of both Salcorp and Katsura, and
is therefore deemed the beneficial owner of these shares. Scarsdale Company
N.V., Inc. ("Scarsdale"), a company associated or affiliated with Mr. Poma,
owns 2,133 of these shares. The remaining 518,000 shares are owned by
Barcel Corporation ("Barcel"). Mr. Poma is the Trustee for United Capital
Trust, a family trust which owns all of the stock of Barcel.
(5) The shares reported are beneficially owned by the direct or indirect
subsidiaries of Mellon Financial Corporation, which report shared voting
and dispositive power with respect to 100,000 shares, sole voting power
with respect to 703,997 shares and sole dispositive power with respect to
703,297 shares.
(6) Woodland Partners LLC manages accounts for the benefit of its clients and
reports sole voting power with respect to 708,100 shares, shared voting
power with respect to 98,100 shares and sole dispositive power with respect
to all shares.
(7) Frontier Capital Management Co., Inc. ("Frontier") is an investment
adviser. These shares are owned directly by various accounts managed by
Frontier. Such accounts have the right to receive the proceeds from the
sale of these shares.
(8) Windsor International Corporation, Atlas World Carriers S.A., The World
Financial Corporation S.A. and Scarsdale, corporations affiliated or
associated with Mr. Soler or certain of Mr. Soler's relatives, hold
226,100, 123,000, 118,000 and 2,133 of these shares of Common Stock,
respectively.
(9) Dean Bailar has sole investment power with respect to a trust in which
35,000 of these shares are held. The other 2,133 shares are held directly
by Dean Bailar.
(10) Includes 2,000 shares owned beneficially by Mr. Jones' spouse (of which Mr.
Jones disclaims beneficial ownership) and 216,667 shares subject to
currently exercisable options. Mr. Jones also owns 23,704 units of deferred
Common Stock under the Company's Executive Deferred Compensation Plan.
(11) Includes 51,750 shares subject to currently exercisable options. Mr.
Workman also owns 7,310 units of deferred Common Stock under the Company's
Executive Deferred Compensation Plan.
(12) Includes 43,334 shares subject to currently exercisable options. Mr. Farley
also owns 4,538 units of deferred Common Stock under the Company's
Executive Deferred Compensation Plan.
15
<PAGE> 18
(13) Consists of 15,000 unissued shares underlying a vested stock award and
9,334 shares subject to currently exercisable options. Mr. Ford also owns
7,605 units of deferred Common Stock under the Company's Executive Deferred
Compensation Plan.
(14) Includes 94,000 shares subject to currently exercisable options.
(15) Includes 453,620 shares subject to currently exercisable options and
awarded but unissued restricted stock. The executive officers also own
57,304 units of deferred Common Stock under the Company's Executive
Deferred Compensation Plan.
RECENT DEVELOPMENTS
On March 22, 2000, a group led by Paul W. Jones, Chairman and Chief
Executive Officer of the Company, and Berkshire Partners, the Boston-based
private equity firm, made a proposal to the Company's Board of Directors calling
for a recapitalization of the Company in which public shareholders of the
Company would receive $21.00 in cash per outstanding share of Common Stock. The
Company's Board of Directors has formed a special committee consisting of
current directors, Benjamin F. Bailar, Calvin W. Aurand, Jr. and Charles W.
Gaillard, to evaluate the proposal. Mr. Bailar serves as Chairman of the special
committee. The special committee has retained legal counsel and will retain a
financial advisor to assist it in evaluating the proposal. Any transaction would
be subject to approvals by the special committee and the Board of Directors,
shareholder approval, confirmatory due diligence to be performed by the
financial institutions that are expected to provide the financing for the
proposed transaction, the negotiation and execution of mutually satisfactory
definitive agreements and other customary conditions. There can be no assurance
that any agreements relating to the proposal will be reached or that any
transaction will be consummated.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Company's independent audit firm for 1999 was Arthur Andersen LLP. The
Board of Directors, including all members of the Audit Committee, has selected
Arthur Andersen LLP to serve as independent auditors of the Company for the year
2000 and proposes ratification of such selection by the stockholders. Arthur
Andersen LLP is familiar with the business and operations of the Company, and
has offices in or convenient to most of the Company's plants and office
locations.
A representative of Arthur Andersen LLP is expected to be present at the
Annual Meeting and will be available to respond to appropriate questions, and
will have the opportunity to make a statement if so desired.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR RATIFICATION OF
THE APPOINTMENT OF
ARTHUR ANDERSEN LLP AS AUDITORS FOR THE YEAR 2000.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act requires the Company's
directors and officers to file reports of their ownership of stock and of
changes in such ownership with the SEC. The Company believes that, during 1999,
its directors and reporting officers complied with all applicable filing
requirements.
SOLICITATION AND EXPENSES OF SOLICITATION
The Company will bear the cost of this solicitation. The Company and its
proxy solicitor, MacKenzie Partners, Inc., may solicit proxies by mail, in
person, via the Internet and by phone. MacKenzie Partners has agreed to assist
the Company in obtaining proxies for the 2000 Annual Meeting for a cost of
approximately $5,000. The Company will reimburse banks, brokerage houses, other
nominees and custodians for the reasonable costs of distributing proxy material
and annual reports to the beneficial owners of the shares they hold of record.
16
<PAGE> 19
SUBMISSION OF STOCKHOLDER PROPOSALS
Under the Federal securities laws and regulations, stockholder proposals
intended for inclusion in the proxy statement to be issued in connection with
the 2001 Annual Meeting of Stockholders must be received by the Company on or
before November 28, 2000, and must otherwise comply with applicable regulations.
Under the Company's By-Laws, in order to be timely, notices of other
stockholder proposals for nominations or other business at an annual meeting
must generally be delivered to the Corporate Secretary of the Company, at the
Company's headquarters, not later than the close of business on the 60th day nor
earlier than the close of business on the 90th day prior to the first
anniversary of the preceding year's annual meeting (February 26, 2001 and
January 27, 2001, respectively, with respect to the 2001 Annual Meeting).
Stockholders proposals for nominations at a special meeting called for the
purpose of electing directors must generally be delivered to the Corporate
Secretary of the Company, at the Company's headquarters, not earlier than the
close of business on the 90th day prior to such meeting and not later than the
close of business on the later of the 60th day prior to such meeting or the 10th
day following the day on which public announcement (as defined) is first made of
the date of such meeting and the nominees proposed by the Board.
ANNUAL REPORT AND FORM 10-K
Copies of the Company's 1999 Annual Report to Shareholders are being mailed
with this Proxy Statement to each stockholder entitled to vote at the Annual
Meeting. The Company is also filing with the SEC its Annual Report on Form 10-K
for the Fiscal Year Ended December 31, 1999. STOCKHOLDERS DESIRING TO RECEIVE A
COPY OF THE FORM 10-K MAY OBTAIN ONE BY WRITING OR CALLING STEVEN K. SIMS,
CORPORATE SECRETARY, U.S. CAN CORPORATION, 900 COMMERCE DRIVE, OAK BROOK,
ILLINOIS, 60523, TELEPHONE: (630) 571-2500.
By Order of the Board of Directors
LOGO
Steven K. Sims
Vice President,
General Counsel and Secretary
17
<PAGE> 20
PROXY PROXY
U.S. CAN CORPORATION
FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD APRIL 27, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder hereby authorizes Paul W. Jones and Steven K. Sims,
with full authority, which may be exercised by either one or both of them, with
power of substitution, to vote and act for the undersigned at the Annual Meeting
of Stockholders of U.S. Can Corporation to be held at the headquarters of the
Company located at 900 Commerce Drive, Oak Brook, Illinois, at 10:00 a.m. (local
time) on April 27, 2000, and at any adjournment thereof, as designated herein,
and the proxies are authorized to vote in their discretion upon such other
business as may properly come before the meeting.
New Address:
---------------------------
---------------------------
---------------------------
PLEASE COMPLETE REVERSE SIDE
<PAGE> 21
U.S. CAN CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [ ]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
FOR WITHHOLD FOR ALL
1. To elect the following nominees ALL ALL EXCEPT* 2. To ratify the selection of FOR AGAINST ABSTAIN
for Director, to serve a term [ ] [ ] [ ] Arthur Andersen LLP as the [ ] [ ] [ ]
expiring in 2003. Company's independent auditors
for 2000.
Paul W. Jones and Benjamin F. Bailar. 3. Check here if you plan [ ]
to attend the Meeting.
- ---------------------------------------- Check here if [ ]
*Nominee Exception address has changed.
(make corrections on
reverse side)
THIS AREA RESERVED FOR ADDRESSING Dated: , 2000
key lines do not print ---------------------------------
---------------------------------------------
Signature(s)
---------------------------------------------
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER Please sign exactly as name appears hereon. Joint
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION owners should each sign personally. Executors,
IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2. trustees, officers, etc. should indicate their titles
when signing.
</TABLE>
FOLD AND DETACH HERE
PLEASE VOTE, SIGN, DATE AND RETURN PROMPTLY
IN THE ENCLOSED ENVELOPE.
