SOUTH JERSEY INDUSTRIES, INC.
Number One South Jersey Plaza, Route 54
Folsom, New Jersey 08037
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 18, 1996
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
South Jersey Industries, Inc. will be held at the office of the Company,
Number One South Jersey Plaza, Route 54, Folsom, New Jersey, on Thursday,
April 18, 1996, at 10:00 A.M., Eastern Time, for the following purposes:
1. To elect four Directors in Class I (Term expiring in 1999).
2. To approve the action of the Board of Directors in appointing
Deloitte & Touche LLP as auditors for the year 1996.
3. To transact such other business as may come before the meeting.
The Board of Directors has fixed the close of business on March 1,
1996 as the record date for determining the shareholders of the Company
entitled to notice of and to vote at the Annual Meeting and any adjournments
thereof, and only holders of stock of the Company of record on that
date are entitled to notice of and to vote at the meeting and any
adjournments.
If you do not expect to be personally present at the meeting, you
are requested to fill in and sign the enclosed form of proxy and return
it promptly in the accompanying business reply envelope.
By Order of the Board of Directors,
George L. Baulig
Secretary
Folsom, N.J. 08037
March 11, 1996
YOUR VOTE IS IMPORTANT.
YOU ARE URGED TO VOTE, DATE, SIGN AND PROMPTLY RETURN
YOUR PROXY IN THE ENCLOSED ENVELOPE.
<PAGE>
SOUTH JERSEY INDUSTRIES, INC.
PROXY STATEMENT
This statement is furnished in connection with the solicitation of
proxies to be used at the Annual Meeting of Shareholders of South Jersey
Industries, Inc. to be held on April 18, 1996, at the office of the Company,
located at Number One South Jersey Plaza, Route 54, Folsom, New Jersey 08037.
The approximate date on which proxy material will first be sent to
shareholders is March 11, 1996.
This solicitation of proxies is made on behalf of the Board of Directors
of South Jersey Industries, Inc. and the Company will bear the cost of the
solicitation. The solicitation will be made by mail, and, in addition, the
Secretary of the Company and regular employees of the Company may solicit
proxies by telephone, telegram or in person. The Company may also employ a
professional proxy-soliciting firm the cost of which will not exceed $7,500
plus expenses. The Company will furnish brokerage houses and other
custodians, nominees or fiduciaries with the number of additional copies of
its proxy material and Annual Report to Shareholders necessary to supply such
materials to the beneficial owners of stock of the Company.
Directors are elected by a plurality vote of all votes cast at the
meeting. Abstentions and broker non-votes will be treated as present for the
purposes of determining a quorum, but will not affect the election of
directors and will not be counted in tabulating the number of votes cast on
the appointment of independent accountants.
Signed proxies in the accompanying form received by the Company will be
voted at the meeting or any adjournments thereof and, where such a proxy
contains a specific instruction as to any matter to be acted on, the shares
represented by the proxy will be voted accordingly. A shareholder who signs
and returns a proxy may revoke it at any time before it is voted. Attendance
at any meeting by a shareholder who has given a proxy does not revoke the
proxy; to revoke the proxy, the attending shareholder must so notify the
secretary of the meeting in writing prior to the voting of the proxy.
The Company had 10,724,731 shares of Common Stock outstanding as of
March 1, 1996. The holders of Common Stock have one vote per share on each
matter to be acted upon. Only shareholders of record at the close of business
on March 1, 1996 will be entitled to vote at the meeting.
ELECTION OF DIRECTORS
At the Annual Meeting, four directors are to be elected to the Board of
Directors in Class I to hold office for a term of three years. It is intended
that the votes of the persons designated as proxies in the accompanying form
of proxy will be cast for the election as directors of Richard L. Dunham, W.
Cary Edwards, Marilyn Ware Lewis and Dr. Peter M. Mitchell. All of the
nominees are members of the present Board of Directors and have previously
been elected by the Company's shareholders. While it is not anticipated that
any of the nominees will be unable to serve, if any should become unable
to accept nomination or election, it is intended that the persons designated
as proxies in the accompanying form of proxy will vote for the election of
such other person as the Board of Directors may recommend.
- 1 -
<PAGE>
NOMINEES
Class I (Term expiring in 1999)
Richard L. Dunham has been a director since 1984. Age 66. Member of the
Executive Committee and Chairman of the Compensation/Pension Committee.
Retired; formerly Chairman (1988 - 1995), President (1980 - 1988), of
Zinder Companies, Inc. and affiliated companies, economic and regulatory
consulting firms, Washington, DC; Member (1986 -1995) of Advisory
Council of Gas Research Institute, Chicago, Il; Former Chairman (1975-
1977) of the Federal Power Commission (now FERC), Washington, DC.
W. Cary Edwards has been a director from 1990 - January 1993 and
September 1993 to present. Age 51. Member of the Audit Committee and the
Compensation/Pension Committee. Partner, Edwards Caldwell & Poff, Esqs.
(1993 to date); Of Counsel (1993) and NJ Managing Partner (1990 - 1993),
law firm of Mudge Rose Guthrie Alexander & Ferdon; Attorney General,
State of New Jersey (1986 - 1989); Chief Legal Counsel - Governor of NJ
(1982 - 1986).
Marilyn Ware Lewis has been a director since 1990. Age 52. Member of the
Audit Committee and the Compensation/Pension Committee. Chairman of the
Board (1988 to date), of American Water Works Company, Inc., Voorhees,
NJ.; Financial Advisor; director CIGNA Corp., Philadelphia, PA;
director, Penn Fuel Gas, Inc. and subsidiaries, Oxford, PA.
Peter M. Mitchell, Ph.D. has been a director since 1981. Age 61. Member
of the Executive Committee, the Compensation/Pension Committee and the
Management Development Committee. President Massachusetts Maritime
Academy, Buzzards Bay, MA (1994 to date); Vice Chancellor (1983 - 1994),
Higher Education Coordinating Council, formerly the Board of Regents of
Higher Education, Boston, MA; director, BayBank, Regional Board, Boston,
MA.
- 2 -
<PAGE>
DIRECTORS CONTINUING IN OFFICE
Class III (Term Expiring in 1998)
Thomas L. Glenn, Jr. has been a director since 1986. Age 61. Member of
the Executive Committee and Chairman of the Audit Committee. Chairman
(1984 to date) of Glenn Insurance, Inc. Absecon, NJ; trustee, of
Atlantic City Medical Center Foundation and Atlanticare Health Plans,
Atlantic City, NJ; trustee, of Atlantic Community College, Mays Landing,
NJ. Mr. Glenn inadvertently failed to file timely reports on SEC Form 4
for the purchase of 1,200 shares of Common Stock of the Company by a
residuary trust of which he was a co-trustee and a co-beneficiary, and
for the subsequent transfer of shares to his direct ownership upon
liquidation of the trust. Such transactions were reported in early 1996.
Herman D. James, Ph.D. has been a director since 1990. Age 52. Member of
the Audit Committee and the Management Development Committee. President,
Rowan College of New Jersey (formerly Glassboro State College) (1984 to
date), Glassboro, NJ; director of the Council for Aid to Education, New
York, NY; director American Association of State Colleges and
Universities, Washington, DC; director New Jersey State Chamber of
Commerce, Trenton, NJ.
Clarence D. McCormick has been a director since 1979. Age 66. Member of
the Executive Committee and the Compensation/ Pension Committee.
Chairman, President and CEO (1988 to date) of The Farmers and Merchants
National Bank of Bridgeton, NJ; Chairman and President of Southern
Jersey Bancorp of Delaware (1989 to date); director of such banks;
director of the Cumberland Mutual Insurance Company; director American
Automobile Association of Southern NJ; trustee of Bridgeton Hospital
Foundation.
Frederick R. Raring has been a director since 1995. Age 58. Member of
the Audit Committee and the Management Development Committee. President,
(1990 to date) of Seashore Supply Company, Atlantic City, NJ, a major
distributor of plumbing and heating supplies and materials.
William F. Ryan Chairman of the Board, President and Chief Executive
Officer of the Company. Has been a director since 1977. Age 61. Chairman
of the Executive Committee. President of the Company since 1980, Chief
Executive Officer since 1981 and Chairman of the Board since 1995;
President of South Jersey Gas Company since 1977, Chief Executive
Officer since 1981 and Chairman of the Board since April 1989; Chairman
of the Board and Chief Executive Officer of Energy & Minerals, Inc.
(EMI) since 1981; Chairman and Chief Executive Officer of R&T Group,
Inc. (R&T) since October 1989; director of South Jersey Energy Company
(Energy Company) since 1973; director of CoreStates New Jersey National
Bank and New Jersey National Corporation, Pennington, NJ; director of
Penn Fuel Gas, Inc. and subsidiaries, Oxford, PA; director of New Jersey
Manufacturers Insurance Company and New Jersey Re-Insurance Company of
West Trenton, NJ.
- 3 -
<PAGE>
DIRECTORS CONTINUING IN OFFICE
Class II (Term expiring in 1997)
Frank L. Bradley, Jr. has been a director since 1986. Age 71. Member of
the Executive Committee and the Compensation/ Pension Committee.
Retired; formerly Chairman, President and CEO (1988 - 1992), Chairman
(1980-1988), of Stone & Webster Management Consultants, Inc., New York,
NY.
Anthony G. Dickson has been a director since 1995. Age 47. Member of the
Audit Committee and the Management Development Committee. President
(1991 to date), Vice President (1984 to 1991), of New Jersey
Manufacturers Insurance Company and New Jersey Re-Insurance Company,
West Trenton, NJ; director of CoreStates New Jersey National Bank and
New Jersey National Corporation, Pennington, NJ; director of New Jersey
State Safety Council, Cranford, NJ; director Alliance of American
Insurers, Schaumburg, IL; trustee, Rider University.
Vincent E. Hoyer has been a director since 1990. Age 71. Member of the
Compensation/Pension Committee and the Management Development Committee.
Consultant (1991 to date); formerly President (now retired) (1966 -
1991) of New Jersey Manufacturers Insurance Company and (1977 - 1991) of
New Jersey Re-Insurance Company, West Trenton, NJ; director (1966 to
date) of New Jersey Manufacturers Insurance Company and (1977 to date)
of New Jersey Re-Insurance Company.
Jackson Neall has been a director since 1990. Age 71. Member of the
Audit Committee and the Management Development Committee. Retired;
former Real estate appraiser (1977 - 1992); registered builder (1989 -
1992); former President of South Jersey Fuel, Inc.; director of Shore
Memorial Hospital; Chairman (1989 to date) of Shore Properties, Inc.,
Somers Point, NJ.
Shirli M. Vioni, Ph.D. has been a director since 1983. Age 55. Member of
the Audit Committee and Chairman of the Management Development
Committee. Superintendent, Oberlin City Schools (1994 to date),
Oberlin, OH; President, Billings-Vioni Management Associates (1990 to
1994), Columbus OH, a human resource consulting firm; Director,
Corporate Human Resource Development (1987-1990), of Honeywell, Inc.,
Minneapolis, MN.
- 4 -
<PAGE>
<TABLE>
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT
<CAPTION>
Number of Shares
of Common Stock
Owned Beneficially % of
Name as of Jan. 19,1996 (1) Class
- ------------------------------ ---------------------- -----
<S> <C> <C>
Frank L. Bradley, Jr 1,181
Anthony G. Dickson 802
Richard L. Dunham 1,411
W. Cary Edwards 1,101
Thomas L. Glenn, Jr 3,767
Vincent E. Hoyer 2,642
Herman D. James 740
Marilyn Ware Lewis 18,550 (2) 0.2%
Clarence D. McCormick 3,067
Peter M. Mitchell, Ph.D 1,129
Jackson Neall 3,968
Frederick R. Raring 94,082 0.9%
William F. Ryan 39,355 0.4%
Shirli M. Vioni, Ph.D 2,081
CoreStates Bank, N.A., Trustee
for Company Thrift Plan 1,455,119 13.6%
18 directors, nominees and
officers as a group 1,666,585 15.5%
<FN>
(1) Based on information furnished to the Company by the respective
directors, nominees and officers of the Company. The Company is informed
that these persons have sole voting power and sole power of disposition
with respect to the shares of Common Stock shown opposite their names,
with the following exceptions: 21,824 of Mr. Ryan's shares and 50,879 of
the shares owned by officers as a group are held in the Company's Thrift
Plan, and the Trustee of the Plan has sole power to vote (but no power
to dispose of) such shares; and 15,300 of Mr. Ryan's shares and 20,160
shares of the officers as a group are not now held by them but may be
acquired through the exercise of stock options.
(2) Includes 18,360 shares over which Mrs. Lewis has effective investment
and voting power but in which she has no beneficial interest.
</FN>
</TABLE>
- 5 -
<PAGE>
Gas Company and other subsidiaries of the Company have maintained
banking relationships for a number of years with The Farmers and Merchants
National Bank of Bridgeton, of which Mr. McCormick is Chairman, President and
a director, and expect to continue such relationships. The highest aggregate
indebtedness of Gas Company and other subsidiaries of the Company to that
bank during 1995 was $6,000,000, and the amount of such indebtedness at
December 31,1995 was $4,000,000. Loans made to Gas Company and other
subsidiaries by that bank are made on terms that are usual and customary at
the time they are made. During 1995, the Company and its subsidiaries paid
$419,353 in legal fees and expenses to the law firm of which Mr. Ryan's
son-in-law, Michael J. Fitzgerald, is a member. During 1995 Gas Company paid
$293,296 for purchases of pipe and fittings from Seashore Supply Company of
which Mr. Raring is President.
<TABLE>
EXECUTIVE COMPENSATION
Summary Compensation Table (1)
<CAPTION>
Annual Compensation
-------------------------------
(a) (b) (c) (d) (e) (i)
Other
Name and Annual All Other
Principal Compen- Compen-
Position Year Salary Bonus sation(2) sation(3)
- ----------------- ---- -------- ----- --------- ----------
<S> <C> <C> <C> <C> <C>
William F. Ryan, 1995 $395,000 - $13,371 $19,576
Chairman, 1994 380,000 - 12,565 19,589
President & CEO 1993 348,750 - 4,622 18,972
Gerald S. Levitt, 1995 167,000 $3,000 767 9,608
Vice President 1994 163,250 - - 9,900
& CFO 1993 156,000 - - 8,893
Richard B. 1995 126,500 3,000 - 5,842
Tonielli, 1994 123,500 - - 5,812
Treasurer 1993 119,125 - - 5,120
George L. Baulig, 1995 105,000 3,000 - 6,842
Secretary & Asst. 1994 101,250 - - 6,682
Treasurer 1993 96,250 - - 6,474
- 6 -
<PAGE>
<FN>
Footnotes to Summary Compensation Table
(1) Columns (f) (g) and (h) have been omitted from the table because no
long term compensation was awarded to, earned by or paid to the named
executives for any year covered by the table.
(2) The Internal Revenue Code limits the contributions that may be made
by or on behalf of an individual under defined contribution plans such
as the Company's Thrift Plan. The Company has adopted a policy of
currently reimbursing its executive officers with the amount of Company
contributions that may not be made because of this limitation (including
the tax liability incurred by the additional income). Pursuant to this
policy, Messrs. Ryan and Levitt were paid $13,371 and $767,
respectively, in 1995, which amounts are included in column (e) of the
Summary Compensation Table.
(3) Column (i) includes Employer Contributions to Thrift Plan, income
value of group life insurance and increase in vested benefit level of
deferred compensation contract. 1995 values for these items are:
Ryan Levitt Tonielli Baulig
Thrift Plan $4,500 $4,563 $1,265 $3,150
Group Life Insurance 9,547 1,920 1,800 1,210
Deferred Compensation 5,529 3,125 2,777 2,482
</FN>
</TABLE>
<TABLE>
Aggregated Option Exercises in Last Fiscal
Year and Fiscal Year-End Option Values
<CAPTION>
(a) (b) (c) (d) (e)
Number of
Securities Value
Underlying of Unexercised
Unexercised In-The-Money
Shares Options at Options at
Acquired Value Fiscal Year-End Fiscal Year-End
Name on Exercise Realized All Exercisable All Exercisable
<S> <C> <C> <C> <C>
William F. Ryan - - 15,300 80,062
Gerald S. Levitt - - 3,330 17,425
George L. Baulig - - 1,530 8,006
</TABLE>
In 1987, the Company adopted a stock option and stock appreciation
rights plan for its officers and other key employees. Of the 304,475 options
authorized, 87,750 options have been awarded. 36,890 of these awarded
options have been exercised.
The Company has employment agreements with its officers and certain
officers of Gas Company, including Messrs. Ryan, Levitt, Tonielli and Baulig.
Each agreement with officers other than Mr. Ryan is for a three-year period
ending July 31, 1997, and provides for a base salary that will be reviewed
periodically, but will be not less than was being paid at the beginning of
the period. If a change of control (as defined in the agreement) occurs
during the period of the agreement, the agreement is automatically extended
for three years from the date the change of control occurs. If, during the
extended term of the agreement, the officer's employment is terminated for
other than cause, or he resigns after there has been a significant adverse
change in his employment arrangements with the Company, he is entitled to a
severance payment
- 7 -
<PAGE>
equal to 300% of his average annual compensation during the preceding five
calendar years. The agreement with Mr. Ryan, which is for a five year term
ending July 31,1999, provides a base salary of $375,000 to be reviewed
annually. Mr. Ryan and his spouse are entitled to the continuation of certain
medical benefits after his employment ends. The agreement may be terminated
by the Company only for cause, death, disability or retirement. Mr. Ryan may
terminate the agreement if the Company makes certain specified adverse
changes in his employment arrangements such as reducing his salary (other
than in connection with company-wide reductions applicable to the Company's
executives generally). If Mr. Ryan elects to terminate the agreement and the
adverse change has occurred after a change in control of the Company, Mr.
Ryan is entitled to a severance payment equal to 300% of his average annual
compensation during the three years preceding his termination. If Mr. Ryan
elects to terminate the agreement under these circumstances, except that
there has not been a change of control of the Company, Mr. Ryan is entitled
to receive a termination payment of $974,000. As part of these overall
arrangements, Mr. Ryan agreed to a five year contract term in order to
address the Company's concern that he remain available as chief executive
officer to age 65, even though his retirement benefit will be fully vested
before that date.
The Company also has an officer severance benefit program that covers
all its officers, including those with whom it has employment agreements. If
an executive officer's employment is terminated and there has been no change
in control, up to one year's salary may be paid under this program.
Pension Plans For Executives
The following table illustrates the current retirement benefits under
the salaried employee pension plan, and the supplemental executive retirement
plan, assuming the executive was born in 1934 and retires at the normal
retirement age of 62.
<TABLE>
<CAPTION>
Years of Service
Remuneration 15 20 25 30 35 40
<S> <C> <C> <C> <C> <C> <C>
$125,000 $ 23,613 $ 31,485 $ 47,524 $ 60,024 $ 60,024 $ 61,348
150,000 30,024 45,024 60,024 75,024 75,024 75,024
175,000 37,524 55,024 72,524 90,024 90,612 90,612
200,000 45,024 65,024 85,024 105,024 105,612 105,612
225,000 52,524 75,024 97,524 120,024 120,612 120,612
250,000 60,024 85,024 110,024 135,024 135,024 135,024
300,000 75,024 105,024 135,024 165,024 165,024 165,024
400,000 105,024 145,024 185,024 225,024 225,024 225,024
450,000 120,024 165,024 210,024 255,024 255,024 255,024
500,000 135,024 185,024 235,024 285,024 285,612 285,612
</TABLE>
As employees, the executive officers of the Company are eligible for
benefits under tax-qualified pension plans for salaried employees established
by the Company or one of its subsidiaries. Compensation considered under
these pension plans consists of base salary only, which in the case of the
executive officers is equal to the cash compensation reported in column (c)
of the Summary Compensation Table. Employees do not make contributions to
the plans, and the employer contributions (which are based on aggregate
actuarial calculations without
- 8 -
<PAGE>
individual allocation) are held and invested by insurance companies of
recognized standing until they are used to provide retirement benefits. Under
certain circumstances, early retirement with reduced annual benefits is
permitted (but not before age 55). Executive officers who are 50 years of
age or older are also covered by an unfunded supplemental retirement plan
that is designed in general to provide the officer with a minimum retirement
benefit from the salaried employee pension plan, the basic Social Security
benefit and the supplemental plan that aggregates 2% of average final five
years salary (as defined in the plan), for each year of service. Pursuant to
Mr. Ryan's agreement, he will retire at age 65 with 33 years of service and
his retirement benefit under the supplemental plan will be based on the
average of his final three years salary. Assuming continued employment and
retirement at age 62, Messrs. Levitt, Tonielli and Baulig will have,
respectively, 24, 37 and 44 years of credited service. No credit is provided
under the supplemental plan for more than 30 years of service.
Compensation/Pension Committee Report on Executive Compensation
The Compensation/Pension Committee of the Board of Directors has
prepared the following report for inclusion in this proxy statement:
Compensation of executive officers of the Company is almost
exclusively by base salary. Such compensation was last adjusted in
October 1994. The Company, by choice, has not made use of annual
incentive awards or long-term incentive award programs. No bonuses were
paid nor stock options granted to any executive officers of the Company
in 1993 or 1994. However, in October 1995, executive officers, other
than the chief executive officer, received one-time payments in lieu of
an increase in base salary. The payments were made to recognize the
continuing contributions of the executive officers to the progress of
the Company while holding base compensation at levels which will enhance
the Company's financial ability to effectively address emerging
competitive challenges brought about by deregulation of the utility
industry. The Committee believes that restricting the growth of base
salaries from time to time, particularly during times of modest
inflation, will assist in signaling a desire to firmly control
increasing costs as the marketplace becomes much more competitive. It
believes that over time the general industry norms will also reflect
this competitive business environment and the continuation of lower
rates of inflation.
Compensation paid to the executive officers of the Company as set
forth in the Summary Compensation Table on page 6 is fixed by the Board
of Directors and is based on the recommendations of the Committee. As a
result of an increase in compensation of executive officers in October
1994, the base compensation that was paid to the executive officers in
1995 was, on average, approximately 3.3% above that paid in 1994.
The base compensation of the chief executive officer, William F.
Ryan, was last increased in October 1994. The Committee and the Board of
Directors continue to believe that the performance of the chief
executive officer is commendable, however the Committee and the Board of
Directors concurred with Mr. Ryan's recommendation that his
compensation not be increased for the same reasons that the base
salaries of all other executive officers was not increased in 1995.
In making its recommendations for executive officer compensation,
including that for the Chief Executive Officer, the Committee considers
a number of factors; an appraisal and evaluation of the officer's
performance; the earnings performance of the Company; information
supplied primarily by a nationally recognized compensation consulting
firm and to a lesser extent other executive compensation surveys in
which the Company or its subsidiaries participate. The consulting firm
provides to the Committee an executive compensation study which
- 9 -
<PAGE>
evaluates salary levels from internal and external perspectives.
External values are determined through comparative market evaluation of
executive compensation levels against organizations of similar scope,
size, industry and operating structure, which are not necessarily
included in the Standard & Poor's Utility Index. Data from multiple
survey sources is extracted from the market for both salary and total
compensation. While the long-term objective has been to fix salary for
executives at or near the median of the comparative group, it is
recognized that occasionally salaries may fall below the median. The
Committee has not adopted a specific formula relationship between
changes in the Company's earnings performance and changes in the levels
of executive compensation.
Richard L. Dunham, Chairman
Frank L. Bradley, Jr.
W. Cary Edwards
Vincent E. Hoyer
Marilyn Ware Lewis
Dr. Peter M. Mitchell
Clarence D. McCormick
Dated: November 16, 1995
Stock Performance Graph
Set forth below is a graph that shows in the form of an index (1990 =
100), for the 1990 - 1995 period, the cumulative total return on the
Company's Common Stock (consisting of the change in share price during each
year plus dividends received which are assumed to be reinvested) compared to
the Standard & Poor's 500 Index and the Standard & Poor's Utility Index. The
Standard & Poor's Utility Index is a commonly used indicator of utility
common stock performance based on selected gas, electric and telephone
companies. The compounded annual growth rate for the Company on the graph is
12.25%. This compares to 16.55% for the Standard & Poor's 500 Index and
15.43% for the Standard & Poor's Utility Index.
Indexed Total Return Assuming Dividends Reinvested Over a 5 Year
Period
(Chart)
<TABLE>
<CAPTION>
Year ending December 31
1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C>
SJI 100 114.97 142.10 158.49 130.57 178.21
S&P UTILITY 100 114.62 127.02 148.46 140.61 204.89
S&P 500 100 130.47 140.41 154.57 156.61 215.02
</TABLE>
- 10 -
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors of the Company met ten times in 1995. All
Directors attended 75% or more of the total of (i) the number of meetings
of the Board of Directors held during the period such director was in office
and (ii) the number of meetings of the committees of the Board on which he or
she served, except for Mr. McCormick who attended 71% of such meetings. The
average attendance for all Board and Committee meetings in 1995 was 93%.
During 1995, each of the directors of the Company also served on the Boards
of one or more of Gas Company, EMI, R&T or Energy, the four direct
subsidiaries of the Company. In 1995, the Board of Energy met ten times and
the Boards of Gas Company, EMI and R&T each met eleven times.
The Audit Committee of the Board of Directors, which met three times in
1995, is composed of eight directors who are not officers, namely, Thomas
L. Glenn, Jr., Chairman, Anthony G. Dickson, W. Cary Edwards, Dr. Herman
D. James, Marilyn Ware Lewis, Jackson Neall, Frederick R. Raring and Dr.
Shirli M. Vioni. The Audit Committee (1) annually recommends to the Board
a firm of independent public accountants for appointment as auditors of
the Company; (2) reviews with the independent auditors the scope and results
of each annual audit; (3) reviews with the independent auditors and the
Company's internal auditors suggestions or recommendations made by either of
them; (4) reviews with appropriate Company officers the performance of the
independent auditors and the internal auditors; (5) considers the possible
effect on the independence of the independent auditors of each professional
service rendered or to be rendered by such auditors; and (6) reviews and
makes recommendations to the Board of Directors regarding the Annual Report
to Shareholders.
The Compensation/Pension Committee of the Board of Directors, which met
four times in 1995, is composed of seven directors who are not officers,
namely, Richard. L. Dunham, Chairman, Frank L. Bradley, Jr., W. Cary Edwards,
Vincent E. Hoyer, Marilyn Ware Lewis, Clarence D. McCormick and Dr. Peter M.
Mitchell. The Compensation/Pension Committee (1) grants options and otherwise
administers the Stock Option and Stock Appreciation Rights Plan; and (2)
reviews and makes recommendations to the Board of Directors on the
operations, performance and administration of the retirement plan, other
employee benefit plans, and employment policies and forms of compensation,
including the performance and levels of compensation of the officers of the
Company.
The Executive Committee of the Board of Directors, which also functions
as a nominating committee, met three times in 1995. It is composed of William
F. Ryan, Chairman, Frank L. Bradley Jr., Richard L. Dunham, Thomas L. Glenn,
Jr., Clarence D. McCormick and Dr. Peter M. Mitchell. Among its functions,
the Executive Committee (1) maintains a list of prospective candidates for
directors, including those recommended by shareholders; (2) reviews the
qualifications of candidates for directors; and (3) makes recommendations to
the Board of Directors to fill vacancies and for nominees for election to the
Board at the Annual Meeting of Shareholders. The Executive Committee will
consider nominees for the Board of Directors recommended by shareholders and
submitted in writing to the Secretary of the Company.
- 11 -
<PAGE>
The Management Development Committee of the Board of Directors, which
met two times in 1995, is composed of eight directors, namely Dr. Shirli M.
Vioni, Chairman, Anthony G. Dickson, Vincent E. Hoyer, Dr. Herman D. James,
Dr. Peter M. Mitchell, Jackson Neall, Frederick R. Raring and William F.
Ryan. The Management Development Committee (1) reviews the Company's programs
and practices used to develop employees identified for leadership positions
in the organization; (2) evaluates training and educational programs to
assure that they reflect current and emerging work place, industry and
general business issues; and (3) evaluates management activities with respect
to corporate affirmative action and work place diversity objectives.
COMPENSATION OF OUTSIDE DIRECTORS
Directors of the Company who are not officers of the Company and who are
not members of the Executive Committee of the Board are paid an annual
retainer of $7,500 plus 25 shares of common stock and fees of $950 per
meeting for each meeting of the Boards of the Company, Gas Company, EMI, R&T
and Energy, respectively, that they attend, except that the maximum fee paid
to any person for attendance at one or more meetings of these Boards held on
the same day is $950. Members of the Executive Committee of the Board who are
not officers of the Company are paid an annual retainer of $10,000 plus 25
shares of common stock and receive the same attendance fees as the other non-
officer directors. The Company has established a policy to recognize
exceptional service to the Company beyond that service normally provided by a
board member. No payments were made under this policy in 1995. Directors who
are also officers of the Company receive no compensation other than their
regular compensation. Members of all the Committees of the Company or of a
subsidiary are paid $475 for each meeting of those Committees that they
attend if the meeting is held on the same day as a Board meeting or $950 if
the meeting is held on any other day. Chairmen of each of those committees
are paid an additional $200 for each meeting of their Committee that they
attend. The Company has established a plan whereby directors may elect to
defer the receipt of fees unti a specified date or until retirement from the
Board. The deferred amount, together with interest, may be paid in a lump
sum or in equal annual installments, as the director elects.
In January 1996 the Board of Directors terminated the retirement plan
for all but three incumbent non-employee directors. Retired directors
currently receiving a benefit under the Plan and three directors who are
serving their final term prior to retirement from the Board in April 1997,
will continue to be entitled to receive benefits which have vested in
accordance with the terms of the Plan. No other director currently serving
will receive a benefit under the Plan. The Board believes that this action is
consistent with current trends in corporate governance to eliminate
perquisites as part of director compensation.
APPOINTMENT OF AUDITORS
Upon the recommendation of the Audit Committee, the Board of Directors,
subject to the approval of the shareholders, has appointed Deloitte & Touche
LLP, independent public accountants, as the auditors of the Company for the
year 1996. Unless otherwise directed, it is proposed to vote proxies "FOR"
approval of this appointment.
Deloitte & Touche LLP served as the auditors of the Company during the
year 1995. During 1995, the audit services performed by that firm for the
Company consisted of the audits of the financial statements of the Company
and its subsidiaries and the preparation of various reports based
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on those audits, services related to filings with the Securities and
Exchange Commission, the New York Stock Exchange, and audits of employee
benefit plans as required by the Employee Retirement Income Security Act.
ANNUAL REPORT AND FINANCIAL INFORMATION
A copy of the Company's Annual Report to Shareholders for the year ended
December 31, 1995 accompanies this proxy statement. The Annual Report is not
proxy soliciting material or a communication by means of which any
solicitation is made. A representative of Deloitte & Touche LLP, whose report
on the Company's financial statements appears in the Annual Report, will be
present at the Annual Meeting and will have the opportunity to make a
statement, if he desires to do so, and to respond to questions from
shareholders.
Upon written request of any person who on the record date for the Annual
Meeting was a record owner of the Company's Common Stock, or who represents
in good faith that he was on such date a beneficial owner of such stock
entitled to vote at the Annual Meeting, the Company will send to such person,
without charge, a copy of its Annual Report on Form 10-K for 1995, as filed
with the Securities and Exchange Commission. Requests for this report should
be directed to George L. Baulig, Secretary, South Jersey Industries, Inc.,
Number One South Jersey Plaza, Route 54, Folsom, New Jersey 08037.
OTHER MATTERS
Any proposal which a qualified shareholder of the Company intends to
present at the 1997 Annual Meeting of Shareholders that is received by the
Company after November 10, 1996 will not be eligible for inclusion in the
Company's proxy statement and form of proxy for that meeting. To be a
qualified shareholder, a shareholder must have owned at least $1,000 in
market value of the Company's securities for at least one year before the
date of submission of the proposal to the Company.
The Board of Directors knows of no matters, other than those set forth
in the Notice of Annual Meeting of Shareholders, to come before the 1996
Annual Meeting. If any other matters or motions properly come before the
Meeting, including any matters dealing with the conduct of the Meeting, it is
the intention of the persons named in the accompanying form of proxy to vote
such proxy in accordance with their judgment.
By Order of the Board of Directors,
George L. Baulig
Secretary
March 11, 1996
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