<PAGE>
SCHEDULE 14A
(Rule 14a-101)
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:
[ ] PRELIMINARY PROXY STATEMENT
[X] DEFINITIVE PROXY STATEMENT
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO RULE 14a-11(c) OR RULE 14a-12
SEQUA CORPORATION
- --------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
SEQUA CORPORATION
- --------------------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX);
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[X] $125 FEE PAID WITH FILING OF PRELIMINARY MATERIAL.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(4) and 0-11.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction applies:
Class A Common Stock, Class B Common Stock, $5.00 Cumulative
Convertible Preferred Stock
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
+ 10,287,921
- --------------------------------------------------------------------------------
(3) Per unit price or other-underlying value of transaction computed
pursuant to Exchange Act Rule 0-11.(1)
--
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by 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: --
- --------------------------------------------------------------------------------
<PAGE>
(4) Date Filed: --
- --------------------------------------------------------------------------------
- ------------
(1) Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE>
[Logo]
SEQUA CORPORATION
200 PARK AVENUE
NEW YORK, NEW YORK 10166
- ----------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 12, 1994
- ----------------------------------------------------------
The annual meeting of stockholders of SEQUA CORPORATION (the 'Company')
will be held in Conference Room 7 on the 11th floor, 270 Park Avenue, New York,
New York, on Thursday, May 12, 1994, at 11 A.M., for the following purposes:
1. To elect directors;
2. To consider and approve the Management Incentive Bonus Plan for
Corporate Executive Officers;
3. To ratify the appointment of Arthur Andersen & Co., independent
public accountants; and
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 23, 1994 are
entitled to notice of and to vote at the meeting and any adjournment thereof. A
list of stockholders will be available for examination by any stockholder, for
any purpose germane to such meeting, during the ten days prior to the meeting
date at the Company's address set forth above.
By order of the Board of Directors,
Ira A. Schreger
Secretary
New York, N.Y.
March 25, 1994
IMPORTANT
PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS
POSSIBLE IN THE ENCLOSED POSTPAID WHITE ENVELOPE WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING. IF YOU ATTEND THE MEETING AND SO DESIRE, YOU MAY WITHDRAW
YOUR PROXY AND VOTE IN PERSON. IF YOU ARE PLANNING TO ATTEND THE MEETING, YOU
MUST RETURN THE ENCLOSED POSTPAID ATTENDANCE CARD AS QUICKLY AS POSSIBLE.
THANK YOU FOR ACTING PROMPTLY.
<PAGE>
SEQUA CORPORATION
200 PARK AVENUE
NEW YORK, NEW YORK 10166
ANNUAL MEETING OF STOCKHOLDERS
MAY 12, 1994
PROXY STATEMENT
PERSONS MAKING THE SOLICITATION
The accompanying proxy is being solicited by the Board of Directors of
Sequa Corporation (the 'Company') for use at the annual meeting of stockholders
to be held on Thursday, May 12, 1994, or any adjournment thereof. If such proxy
is properly signed and returned prior to the meeting, the shares with respect to
which the proxy is given will be voted as indicated thereon; provided, however,
that a stockholder may revoke his proxy at any time prior to its use at the
meeting, either by giving written notice addressed to the Secretary of the
Company, at its executive offices located at 200 Park Avenue, New York, New York
10166, or by voting in person at the meeting. The entire cost of soliciting
proxies will be borne by the Company. Proxies will be solicited principally
through the use of the mails but directors, officers and regular employees of
the Company, without additional compensation, may use their personal efforts by
telephone or otherwise to obtain proxies. The Company will also request banks,
brokers and other nominee holders of the Company's shares to forward proxy
materials to their principals or customers who are beneficial owners of such
shares and will reimburse such holders for their reasonable expenses incurred in
doing so. The Company anticipates that mailing of proxy material to stockholders
will commence the week of April 4, 1994.
VOTING SECURITIES AND OWNERSHIP THEREOF
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Only stockholders of record at the close of business on March 23, 1994, the
record date with respect to this solicitation, will be entitled to notice of,
and to vote at, the meeting. On the record date, there were outstanding
6,223,629 shares of the Company's Class A Common Stock, no par value ('Class A
Common Stock'), 3,430,978 shares of the Company's Class B Common Stock, no par
value ('Class B Common Stock'), and 633,316 shares of the Company's $5.00
Cumulative Convertible Preferred Stock, par value $1.00 per share ('Preferred
Stock'), which constitute the only outstanding voting securities. Each share of
Class B Common Stock is convertible at any time into one share of Class A Common
Stock, and each share of Preferred Stock is convertible at any time into 1.322
shares of Class A Common Stock, subject to certain adjustments. Each share of
Class A Common Stock and each share of Preferred Stock have one vote and, with
respect to all matters to come before the meeting, will vote with the Class B
Common Stock, which has ten votes per share. The presence in person or by proxy
of stockholders of record representing in the aggregate a majority of the
combined outstanding voting rights of all classes of stock of the Company
entitled to vote shall constitute a quorum for the transaction of business.
Broker non-votes and abstentions are counted in determining the existence of a
<PAGE>
quorum. Thereafter, the affirmative vote of the holders of shares of stock
representing a majority of the combined voting rights of all eligible classes of
stock present or represented at the meeting is required for the election of a
director and the approval of plans. Votes are counted preliminarily by the
Company's transfer agent through its automated system and finally, at the Annual
Meeting of Stockholders, by the Inspectors of Election.
SECURITY OWNERSHIP BY CERTAIN BENEFICIAL OWNERS
The table below sets forth information with respect to any person (other
than the Company's directors) known to the Company to be the beneficial owner of
more than five percent of any class of the Company's outstanding voting
securities as of March 1, 1994. Except to the extent indicated in the footnotes,
sole voting and investment power with respect to the shares shown is held by the
owner named.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
OF CLASS A PERCENT OF AGGREGATE
NAME AND ADDRESS COMMON STOCK CLASS VOTING POWER
- --------------------------------------------------------- ---------------- ---------- ------------
<S> <C> <C> <C>
Tiger Management Corporation ............................ 897,792(1) 14.42(1) 2.18%
(and affiliates)
101 Park Avenue
New York, NY 10178
Wellington Management Company ........................... 541,700(2) 8.70(2) 1.32
75 State Street
Boston, MA 02109
Heine Securities Corporation ............................ 354,864(3) 5.70(3) (4)
(and affiliates)
51 J.F.K. Parkway
Short Hills, NJ 07078
Gabelli Funds, Inc. ..................................... 367,500(5) 5.90(5) (4)
(and affiliates)
One Corporate Center
Rye, NY 10580-1434
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
OF CLASS B PERCENT OF AGGREGATE
COMMON STOCK CLASS VOTING POWER
---------------- ---------- ------------
<S> <C> <C> <C>
Gabelli Funds, Inc. ..................................... 724,100(5) 21.10(5) 17.59
(and affiliates)
One Corporate Center
Rye, NY 10580-1434
</Table
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
OF PERCENT OF AGGREGATE
PREFERRED STOCK CLASS VOTING POWER
---------------- ---------- ------------
<S> <C> <C> <C>
Paloma Partners ......................................... 231,200 36.51 (4)
99 River Road
Cos Cob, CT 06807
Gabelli Funds, Inc. ..................................... 242,300(5) 38.26(5) (4)
(and affiliates)
One Corporate Center
Rye, NY 10580-1434
</TABLE>
(footnotes on next page)
2
<PAGE>
(footnotes from previous page)
(1) Of the aggregate shares shown, 5,400 are held in trusts for the benefit
of Julian H. Robertson, Jr., the majority shareholder of Tiger Management
Corporation, and members of his family; Mr. Robertson exercises no voting power
and shares dispositive power with respect to those shares.
(2) Wellington Management Company ('WMC') does not have sole voting or sole
dispositive power with respect to any of these shares; it has shared voting
power with respect to 352,000 shares and shared dispositive power with respect
to all of the shares listed. WMC is an investment advisor with respect to the
reported shares, which are owned by numerous investment counseling clients.
(3) Heine Securities Corporation and its President, Michael F. Price,
disclaim beneficial ownership of all reported securities, which they control as
investment adviser to one of their clients.
(4) Less than 1%.
(5) Gabelli Funds, Inc. (and affiliates) (collectively, the 'Gabelli
Companies') owns beneficially 242,300 shares of Preferred Stock. Pursuant to
Rule 13d-3(d)(1) under the Securities Exchange Act of 1934, as amended (the
'1934 Act'), the total of the Gabelli Companies' Class A Common Stock and
Preferred Stock (if converted into Class A Common Stock) would give the Gabelli
Companies holdings of 687,821 shares of Class A Common Stock, or 10.51 percent
thereof. Of the Class A Common Stock, the Gabelli Companies have shared voting
power with respect to 1,000 shares, no voting power with respect to 55,000
shares and shared dispositive power with respect to 1,000 shares. Of the
Preferred Stock, the Gabelli Companies have shared voting power and shared
dispositive power with respect to 500 shares. If the Preferred Stock and the
724,100 shares of Class B Common Stock owned beneficially by the Gabelli
Companies were all converted to Class A Common Stock, pursuant to Rule
13d-3(d)(1) under the 1934 Act, and added to their current holdings of Class A
Common Stock, the Gabelli Companies would hold 19.43 percent of the Class A
Common Stock. In connection with its shares of Class B Common Stock, the Gabelli
Companies have no voting power with respect to 66,000 shares.
- ----------------------------------------------------------
SECURITY OWNERSHIP BY MANAGEMENT
The following table provides information as to the Company's voting
securities beneficially owned as of March 1, 1994, by the Company's directors
who are standing for re-election, the named executive officers of the Company
and by all such directors and executive officers as a group. None of the
Company's executive officers or directors owns Preferred Stock. Except to the
extent indicated in the footnotes, sole voting and investment power with respect
to the shares shown is held by the owner named.
<TABLE>
<CAPTION>
PERCENT
NUMBER OF NUMBER OF OF
SHARES OF PERCENT SHARES OF PERCENT AGGREGATE
CLASS A OF CLASS B OF VOTING
COMMON STOCK CLASS COMMON STOCK CLASS POWER
------------ ------- ------------ ------- ---------
<S> <C> <C> <C> <C> <C>
Norman E. Alexander................... 1,823,449(a) 29.30 1,856,447 54.11 49.53
Alvin Dworman......................... 413 (b) None -- (b)
A. Leon Fergenson..................... 2,623(c) (b) 2,283(c) (b) (b)
David S. Gottesman.................... 7,500 (b) None -- (b)
</TABLE>
(table continued on next page)
3
<PAGE>
(table continued from previous page)
<TABLE>
<CAPTION>
PERCENT
NUMBER OF NUMBER OF OF
SHARES OF PERCENT SHARES OF PERCENT AGGREGATE
CLASS A OF CLASS B OF VOTING
COMMON STOCK CLASS COMMON STOCK CLASS POWER
------------ ------- ------------ ------- ---------
<S> <C> <C> <C> <C> <C>
Stuart Z. Krinsly..................... 56,876(a) (b) 64,030 1.87 1.69
Donald D. Kummerfeld.................. 200 (b) None -- (b)
Richard S. LeFrak..................... None -- 500 (b) (b)
John J. Quicke........................ 2,334(d) (b) 500 (b) (b)
Antonio L. Savoca..................... None -- None -- --
Fred R. Sullivan...................... 1,659(e) (b) 648 (b) (b)
Gerald Tsai, Jr....................... 500 (b) None -- (b)
Martin Weinstein...................... 10,992(a) (b) None -- (b)
All executive officers and directors
as a group (14 persons including the
above).............................. 1,907,046(a)(d) 30.64 1,924,408 56.09 51.38
</TABLE>
- ------------
(a) Includes certain shares held for the benefit of the named executive
officer in the Company's 401-K Plan.
(b) Less than one percent.
(c) Includes 1,670 shares of Class A Common Stock and 1,500 shares of Class
B Common Stock owned by Mrs. A. Leon Fergenson, as to which Mr. Fergenson
disclaims beneficial ownership.
(d) Consists of 2,334 shares of Class A Common Stock which may be obtained
upon the exercise, within sixty days of the date of this Proxy Statement, of
stock options by Mr. Quicke. No other executive officer holds stock options that
are exercisable within sixty days.
(e) Includes 500 shares of Class A Common Stock owned by Mrs. Fred R.
Sullivan.
SECTION 16(a) REPORTING
As required by the rules promulgated under Section 16 of the 1934 Act, the
Company notes that, during 1993, Mr. Raymond Frankel's Form 4, reporting two
purchases of an aggregate of 2,500 shares of Class B Common Stock, was filed
approximately one month late. Mr. Frankel was a director of the Company through
March 1994.
ELECTION OF DIRECTORS
DIRECTORS
At the meeting, ten directors are to be elected to hold office until the
next annual meeting and until their successors shall have been elected. If no
other instructions are given, the persons named in the enclosed form of proxy
will vote for the election of the nominees named in the table below. In case any
such nominee should become unavailable for any reason, an event not now
anticipated, the proxy holders reserve the right to substitute another person of
their choice in his place. Each of the nominees has previously been elected by
the stockholders.
4
<PAGE>
<TABLE>
<CAPTION>
PRESENT OCCUPATION AND
NAME AND AGE OTHER INFORMATION
- ------------------------------------------ ---------------------------------------------------------------------
<S> <C>
Norman E. Alexander ...................... Chairman of the Board and Chief Executive Officer of the Company
Age 79 since 1975. Served as President from 1982 to 1983 and from 1957 to
1975. Has been a director of the Company since 1957 and is a member
of the Executive Committee. May be deemed to be a control person of
the Company (see 'Voting Securities and Ownership Thereof by
Certain Beneficial Owners and Management'). Also a director and
Chairman of the Board of Chock Full O' Nuts Corporation and a
director of Richton International Corporation.
Alvin Dworman ............................ Chairman, ADCO Group (a real estate merchant banking and financial
Age 68 services company) since 1981. Has been a director of the Company
since 1987 and is a member of the Audit Committee.
A. Leon Fergenson ........................ Former Chairman of the Board and Chief Executive Officer, GK
Age 81 Technologies, Inc. (wire and cable products, electronic and
electrical circuits, environmental and other products). Has been a
director of the Company since 1968 and is a member of the Executive
Committee and the Compensation Committee and Chairman of the Audit
Committee. Also a director of Buckeye Management Company, National
Benefit Life Insurance Company, several mutual funds sponsored by
Neuberger and Berman and American Annuity Group, Inc.
David S. Gottesman ....................... Managing Partner, First Manhattan Co. (a research and investment
Age 67 management company) since 1964. Has been a director of the Company
since 1982 and is a member of the Nominating Committee.
Stuart Z. Krinsly ........................ Senior Executive Vice President and General Counsel of the Company
Age 76 since 1982; from 1966 to 1982, served as an officer and General
Counsel of the Company. Has been a director of the Company since
1957 and is a member of the Executive Committee. Also a director of
Chock Full O' Nuts Corporation.
Donald D. Kummerfeld ..................... President, Magazine Publishers of America (a publishing trade
Age 59 organization) since 1987 and Chairman, Kummerfeld Associates (an
investment banking and financial advisory firm) since 1985. From
1978 to 1985, was President and Chief Operating Officer, News
America Publishing, Inc. Has been a director of the Company since
1983 and is a member of the Compensation Committee.
Richard S. LeFrak ........................ President, Lefrak Organization, Inc. (a diversified, privately held
Age 48 company active in major residential and commercial real estate
development projects, oil and gas exploration, finance and
entertainment production) since 1975. Has been a director of the
Company since 1986 and is a member of the Nominating Committee.
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
PRESENT OCCUPATION AND
NAME AND AGE OTHER INFORMATION
- ------------------------------------------ ---------------------------------------------------------------------
<S> <C>
John J. Quicke ........................... President and Chief Operating Officer of the Company since March
Age 44 1993. Served as Senior Executive Vice President, Operations, of the
Company from June 1992 to March 1993; from February 1991 to June
1992, served as Vice President, Financial Services, of the Company;
from 1987 to February 1991, served as Vice President, Financial
Projects, of the Company. Served as Vice President and Controller
of Chromalloy American Corporation (which became a subsidiary of
the Company in 1987) from 1983 to 1987, and held various other
positions in Chromalloy American Corporation from 1979 to 1983. Has
also served as President of Sequa Capital Corporation (a subsidiary
of the Company) since February 1991. Has been a director of the
Company since March 1993 and is a member of the Executive
Committee.
Fred R. Sullivan ......................... Chairman of the Board and Chief Executive Officer, Richton
Age 79 International Corporation (a holding company) since 1989. From 1987
to 1991, served as Chairman of the Board and President, Interim
Systems Corporation (a temporary personnel and health care service
company). From 1971 to 1988, served as Chairman of the Board and
President, Kidde, Inc. (a multi-market manufacturing and service
company). Has been a director of the Company since 1962 and is a
member of the Audit Committee. Also a director of Midlantic
Corporation and Midlantic National Bank.
Gerald Tsai, Jr. ......................... Chairman, President and Chief Executive Officer, Delta Life
Age 65 Corporation (an insurance company) since February 1993; private
investor from 1991 to 1993; Chairman of the Executive Committee of
the Board of Directors, Primerica Corporation (a diversified
financial services company) from 1988 to 1991; from 1987 to 1988,
was Chairman and Chief Executive Officer of Primerica; and from
1982 to 1987, held several other offices at Primerica. Has been a
director of the Company since 1976 and is a member of the Audit
Committee and Chairman of the Compensation Committee. Also a
director of Rite Aid Corporation, Palm Beach National Bank & Trust
Company, HEM Pharmaceuticals Corporation, Proffitt's Inc. and
Zenith National Insurance Corp. Also a Trustee of Boston
University, Meditrust and New York University Medical Center.
</TABLE>
During 1993, the Company's Board of Directors held nine regularly scheduled
meetings. All of the directors attended at least 75% of the aggregate of
regularly scheduled Board meetings and committee meetings of which they are
members.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU
VOTE 'FOR' THE ELECTION OF THE ABOVE NOMINEES FOR DIRECTOR.
6
<PAGE>
COMMITTEES OF THE BOARD OF DIRECTORS
The Company has an Executive Committee consisting of Messrs. Alexander,
Fergenson, Krinsly and Quicke; an Audit Committee consisting of Messrs. Dworman,
Fergenson, Sullivan and Tsai; a Compensation Committee consisting of Messrs.
Fergenson, Kummerfeld and Tsai; and a Nominating Committee consisting of Messrs.
Gottesman and LeFrak. The Executive Committee acts in place of the full Board of
Directors between meetings thereof, evaluates a variety of projects of the
Company and makes recommendations to the Board. It met five times during 1993.
The activities of the Audit Committee include a review with the independent
auditors of the plans and results of the audit engagement; conferring with
respect to audit activities; consideration of the independence of the auditors;
review of the auditors' fees and the recommendation to the Board as to the
engagement of the auditors. During 1993, the Audit Committee met three times.
The Compensation Committee recommends to the Board the compensation arrangements
for directors and officers. During 1993, the Compensation Committee met three
times. The Nominating Committee selects candidates for election to the Board of
Directors or to fill vacancies thereon, after consideration of nominees proposed
to it in writing, provided that such nominees have agreed in writing to be
candidates for the Board of Directors. The Nominating Committee did not meet
during 1993.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
In June 1992, Fred R. Sullivan settled a claim by the United States
Securities and Exchange Commission that he disclosed material, non-public
information that led to the purchase of stock by another person. No allegation
of personal profit to Mr. Sullivan was made. Mr. Sullivan agreed to the entry of
a judgment permanently enjoining him from engaging in certain activities in
violation of Section 10(b) of the Securities Exchange Act of 1934, as amended,
and Rule 10b-5 thereunder, in connection with the purchase or sale of any
security and paid a fine of $58,000.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The master trust of the Company's Pension Plan had an investment of
approximately $300,000, as of December 31, 1993, in ADCO Equity Bridge Fund
Limited Partnership, which is managed by the ADCO Group, of which Mr. Dworman, a
Director of the Company, is Chairman and owner. The investment is a mortgage on
an office complex in Pennsylvania, due in 1995 and paying interest at a rate
equal to the prime rate plus 1.5%.
In connection with Mr. Quicke's relocation to New York, the Company has
made a $300,000 interest-free loan, payable on demand, and secured by a second
mortgage on his home.
In connection with Mr. Weinstein's relocation to New York, the Company has
made a $300,000 unsecured, interest-free loan, payable in June 1997.
COMPENSATION OF DIRECTORS
Each director who is not an employee of the Company received an annual
retainer of $27,500 for 1993 and $500 for each meeting attended. Non-employee
members of the Executive Committee, Audit Committee, Nominating Committee and
Compensation Committee receive an additional annual fee of $5,000, $3,500,
$2,500 and $3,500, respectively, and $500 for each committee meeting attended.
The
7
<PAGE>
Company also reimburses its non-employee directors for travel, lodging and
related expenses they may incur in attending Board and Committee meetings.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation paid for services rendered
in all capacities to the Company and its subsidiaries during 1991, 1992 and 1993
to the Chief Executive Officer of the Company and to the next four most highly
compensated executive officers.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
------------
ANNUAL COMPENSATION AWARDS
------------------------------------- ------------
OTHER SECURITIES ALL
NAME AND ANNUAL UNDERLYING OTHER
PRINCIPAL BONUS COMPENSATION OPTIONS/ COMPENSATION
POSITION YEAR SALARY ($) ($) SARS(#) ($)
- ----------------------------------------- ---- --------- -------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Norman E. Alexander ..................... 1993 $993,653 -- -- 15,000 $ 4,497(1)
Chairman and Chief Executive Officer 1992 954,200 -- -- -- 4,364(1)
1991 945,435 -- -- -- --
Stuart Z. Krinsly ....................... 1993 531,472 -- -- 12,500 4,951(1)
Senior Executive Vice President and 1992 510,380 -- -- -- 4,862(1)
General Counsel 1991 506,575 -- -- -- --
John J. Quicke .......................... 1993 374,599(2) -- $ 50,666(3) 12,000 4,497(1)
President and Chief Operating Officer 1992 264,745 $195,465 -- -- 4,364(1)
1991 190,556 61,600 -- 3,500 --
Martin Weinstein ........................ 1993 418,250(4) -- -- 11,000 4,364(1)
Senior Vice President, Gas Turbine 1992 371,000 -- -- -- 4,364(1)
Operations 1991 371,000 226,291 -- -- --
Antonio Savoca .......................... 1993 324,250 243,188 66,372(5) 7,500 67,462(1)
Senior Vice President, Atlantic 1992 324,250 234,000 68,624(5) -- 63,384(1)
Research Operations 1991 318,480 243,200 -- -- --
</TABLE>
- ------------
(1) These amounts consist of a matching contribution by the Company under the
respective 401-K Plan in which each executive officer participates ($4,364
as to each executive officer in 1992; $4,497 as to Messrs. Alexander,
Krinsly and Quicke, $4,364 as to Mr. Weinstein and $5,396 as to Mr. Savoca
in 1993), plus (i) with respect to Mr. Krinsly, $498 and $454 for executive
term life insurance premiums in 1992 and 1993, respectively; and (ii) with
respect to Mr. Savoca, $1,200 for an executive term life insurance premium
in 1992 and 1993, and $57,820 credited as a benefit (including interest
payable at the prime rate) in 1992 ($60,866 in 1993) under a Supplemental
Executive Retirement Plan ('SERP') maintained by Atlantic Research
Corporation, an affiliate of the Company ('ARC') (the SERPs in which the
other named executive officers participate are defined benefit plans, unlike
the ARC plan, and are, therefore, accounted for under 'Pension Plans').
(2) This includes one additional month's salary to cover incidental relocation
expenses.
(3) This amount represents a tax gross-up in connection with reimbursement for
moving and relocation expenses.
(footnotes continued on next page)
8
<PAGE>
(footnotes continued from previous page)
(4) This amount includes $47,250 for additional compensation in connection with
Mr. Weinstein's management of another Chromalloy Gas Turbine operation,
Chromalloy Research and Technology, commencing in June 1993. Such additional
compensation of $81,000 per year shall be payable only for the duration of
this temporary assignment, which shall cease no later than 1996.
(5) These amounts consist of the aggregate cost of personal benefits provided by
ARC; the two items that each exceed 25% of the total value of all reported
personal benefits provided to Mr. Savoca are $37,956 in 1992 ($36,144 in
1993) paid for his residence near the facilities of ARC, and $23,925 in each
of 1992 and 1993 paid in connection with ARC's 'cafeteria' plan, allowing
for reimbursement of certain items with payment of the unused balance (up to
the entire amount) to the executive in cash.
9
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table sets forth all stock options (there are no SARs)
granted to the Chief Executive Officer of the Company and to the next four most
highly compensated executive officers during 1993. All options are for shares of
Class A Common Stock.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------------------------------
PERCENT OF
TOTAL
NUMBER OF OPTIONS POTENTIAL REALIZABLE VALUE AT
SECURITIES GRANTED TO ASSUMED ANNUAL RATES OF STOCK
UNDERLYING EMPLOYEES EXERCISE OR PRICE APPRECIATION FOR OPTION TERM
OPTIONS IN FISCAL BASE PRICE EXPIRATION ----------------------------------
NAME GRANTED YEAR ($/SH) DATE 5%($)
- --------------------- ------------ ------------ ----------- ---------- ----------------------------------
<S> <C> <C> <C> <C> <C>
Norman E.
Alexander.......... 15,000(1)(2) 4.60% $ 32.25 9/22/98 $133,647
Stuart Z. Krinsly.... 12,500(2)(3) 3.83 32.25 9/22/98 111,373
John J. Quicke....... 12,000(2)(3) 3.68 32.25 9/22/98 106,918
Martin Weinstein..... 11,000(4) 3.37 32.25 9/22/98 98,008
Antonio Savoca....... 7,500(2)(5) 2.30 32.25 9/22/98 66,824
</TABLE>
<TABLE>
<CAPTION>
NAME 10%($)
- --------------------- ----------------------------------
<S> <C>
Norman E.
Alexander.......... $295,332
Stuart Z. Krinsly.... 246,110
John J. Quicke....... 236,266
Martin Weinstein..... 216,577
Antonio Savoca....... 147,666
</TABLE>
- ------------
(1) This option grant consists entirely of a non-qualified option.
(2) These options vest in three equal annual installments, commencing on the
first anniversary of the date of grant.
(3) These options are Incentive Stock Options ('ISO's') with respect to 9,300
shares and non-qualified options with respect to the balance.
(4) This option grant consists entirely of an ISO and is exercisable as to 3,100
shares, cumulatively, of the total each year for three years, commencing on
the first anniversary of the date of grant and 1,700 shares commencing on
the fourth anniversary thereof.
(5) This grant consists entirely of an ISO.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES TABLE
During 1993, none of the named executive officers exercised any stock
options. The following table shows the number of shares of Class A Common Stock
represented by outstanding unexercised stock options (there are no SARs) held by
each of the named executive officers as of December 31, 1993 and the value
thereof. The Class A Common Stock had a closing price of $32.50 on December 31,
1993.
10
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS AT
AT FISCAL YEAR-END FISCAL YEAR-END
---------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Norman E. Alexander..................................... -- 15,000 -- $ 3,750
Stuart Z. Krinsly....................................... -- 12,500 -- 3,125
John J. Quicke.......................................... 2,334 13,166 $ 0 3,000
Martin Weinstein........................................ -- 11,000 -- 2,750
Antonio L. Savoca....................................... -- 7,500 -- 1,875
</TABLE>
PENSION PLANS
The following tables show the estimated annual pension benefits payable to
each covered participant at normal retirement age under the Company's qualified
defined benefit pension plans, taking into account any applicable nonqualified
supplemental pension plans that provide benefits that would otherwise be denied
participants by reason of certain Internal Revenue Code limitations on qualified
plan benefits and any existing individual agreements, based on remuneration that
is covered under the plans and agreements and years of service with the Company
and its subsidiaries. There are separate pension plans within the Company for
various subsidiaries.
PENSION PLAN TABLE -- A
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------
PLAN COMPENSATION 35 40
- -------------------------------------------------------------------------------- -------- --------
PROJECTED PLAN
PAYOUT
--------------------
<S> <C> <C>
$ 600,000...................................................................... $341,968 $390,820
800,000...................................................................... 458,634 524,153
1,000,000...................................................................... 575,301 657,487
1,200,000...................................................................... 691,968 790,820
1,400,000...................................................................... 808,634 924,153
</TABLE>
Table A applies to Messrs. Alexander and Krinsly.
PENSION PLAN TABLE -- B
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------------------
PLAN COMPENSATION 30 35 40
- ------------------------------------------------------------------- -------- -------- --------
PROJECTED PLAN PAYOUT
--------------------------------
<S> <C> <C> <C>
$200,000........................................................... $ 85,624 $ 99,894 $108,894
300,000........................................................... 130,624 152,394 165,894
400,000........................................................... 175,624 204,894 222,894
500,000........................................................... 220,624 257,394 279,894
600,000........................................................... 265,624 309,894 336,894
</TABLE>
Table B applies to Mr. Quicke.
11
<PAGE>
PENSION PLAN TABLE -- C
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------------------
PLAN COMPENSATION 30 35 40
- ------------------------------------------------------------------- -------- -------- --------
PROJECTED PLAN PAYOUT
--------------------------------
<S> <C> <C> <C>
$400,000........................................................... $213,115 $233,115 $253,115
500,000........................................................... 268,115 293,115 318,115
600,000........................................................... 323,115 353,115 383,115
</TABLE>
Table C applies to Mr. Weinstein.
PENSION PLAN TABLE -- D
<TABLE>
<CAPTION>
YEARS OF SERVICE
------------------
PLAN COMPENSATION 5 10
- ---------------------------------------------------------------------------------- ------- -------
PROJECTED PLAN
PAYOUT
------------------
<S> <C> <C>
$200,000.......................................................................... $15,493 $30,986
300,000.......................................................................... 23,493 46,986
</TABLE>
Table D applies to Mr. Savoca. Plan compensation is limited by SS401(a)(17)
of the Internal Revenue Code to $150,000 for 1994 and $235,840 for 1993. Plan
benefits are limited by SS415 of the Code, which is generally $118,800 for 1994.
Compensation covered by the plans consists of total pay for services,
including elective deferrals to qualified plans, but excluding severance
payments, expense reimbursements, and other non-wage items. Compensation for Mr.
Savoca also excludes bonuses. With respect to Messrs. Alexander, Krinsly and
Savoca, benefits are based on their respective highest average annual
compensation in any five consecutive years of employment with the Company. With
respect to Mr. Quicke, benefits are based on his average compensation for all
years after 1983. With respect to Mr. Weinstein, benefits are based on his
average compensation for all years after 1979.
The estimated credited years of service and plan compensation for the named
executive officers are:
<TABLE>
<CAPTION>
ESTIMATED
CREDITED YEARS PLAN
OF SERVICE* COMPENSATION
-------------- ------------
<S> <C> <C>
Alexander................................. 37 $1,366,311
Krinsly................................... 37 699,301
Quicke.................................... 34 238,644
Weinstein................................. 32 499,071
Savoca.................................... 4 223,069
</TABLE>
Benefits shown are computed as a straight life annuity beginning at age 65
and are offset by a portion of estimated Social Security benefits, if
applicable.
- ------------
* At normal retirement age or current age if older.
12
<PAGE>
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND
CHANGE-IN-CONTROL ARRANGEMENTS
The Company has entered into employment agreements with the following named
executive officers (supplementary retirement agreements with any of the named
executive officers are accounted for in the foregoing section, 'Pension Plans'):
<TABLE>
<CAPTION>
TERM OF ANNUAL
NAME TITLE AGREEMENT COMPENSATION
- --------------------------- ----------------------------------------- --------------------- ------------
<S> <C> <C> <C>
John J. Quicke............. President and Chief Operating Officer 4/1/93 - 3/31/96(1) $372,000(2)
Martin Weinstein........... Senior Vice President, Gas Turbine
Operations 10/1/91 - 12/31/96(1) $452,000(2)(3)
Antonio L. Savoca.......... Senior Vice President, Atlantic Research
Operations 3/1/91 - 2/28/97(1) $362,206(2)(4)
</TABLE>
- ------------
(1) The term may be extended or terminated prior to expiration under certain
circumstances (including death, disability and for cause). Messrs. Quicke's
and Weinstein's agreements provide that, in the event of a change in control
of the Company, the term of employment may be extended, at the executive's
option, for two years.
(2) These amounts reflect 1993 salaries and do not include additional incentive
compensation which may be payable.
(3) This includes $81,000 per year in connection with a temporary assignment
(for a period ending no earlier than May 31, 1995 nor later than May 31,
1996) to manage another Chromalloy Gas Turbine operation, Chromalloy
Research and Technology.
(4) This includes a $37,956 per year housing allowance for Mr. Savoca's
residence near the ARC facilities.
13
<PAGE>
STOCK PERFORMANCE GRAPH -- 5 YEAR CUMULATIVE INDEX
The graph set forth below compares the annual percentage change in the
cumulative total shareholder return on an investment of $100 in the Company's
Common Stock, on an indexed basis, with the S&P 500 Stock Index and the S&P
Aerospace/Defense Index, for the period of five years ended December 31, 1993.
TOTAL RETURN TO SHAREHOLDERS
REINVESTED DIVIDENDS
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
Indexed\Cumulative Returns
Base ----------------------------------------------
Period Return Return Return Return Return
Company\Index Name 1988 1989 1990 1991 1992 1993
- -------------------------------------------------------- ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
SEQUA CORP -- CL A 100 128.22 102.08 77.39 58.32 59.67
SEQUA CORP -- CL B 100 123.80 116.35 80.44 54.82 54.74
AEROSPACE/DEFENSE 100 118.17 123.35 147.46 155.13 201.78
S & P 500 COMP -- LTD 100 131.69 127.60 166.47 179.15 197.21
</TABLE>
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD ON EXECUTIVE COMPENSATION
The Company's executive compensation program is developed and implemented
by the Company's Human Resources Department in conjunction with the Compensation
Committee of the Board of Directors. This program is based upon objectives that
seek to attract and retain key executives critical to the success of the
Company, and reward and motivate executives for performance that maximizes
Company success and shareholder value. In order to accomplish these goals, the
Company has designed a competitive base salary program and annual incentive cash
bonus plans which are predominantly geared toward achievement of stated
financial goals. In addition, stock option grants are awarded from time to time
in order to emphasize stockholder returns and focus on long-term goals.
Base salary determinations for executive officers of the Company are
intended to maintain competitive rates of pay for executives in relation to the
market. The base salary levels for Mr. Alexander and all other executive
officers are reviewed and approved by the Compensation Committee based upon
extensive competitive salary data, which is analyzed by the Company's Human
Resources Department. This data consists of surveys published by a number of
different firms, including Towers Perrin, Hewitt Associates, the Conference
Board, Sibson and Company and the American Compensa-
14
<PAGE>
tion Association. These surveys disclose salary ranges for executives at
corporations comparable to the Company in size and industry mix, including firms
classified as 'S&P 500'. The Human Resources Department does not limit its
comparative analyses to companies classified as 'Aerospace/Defense', since it
believes that the Company competes for executive talent beyond these industries.
The base salary level for certain of the executive officers falls at the high
end of the survey spectrum, although percentages are disproportionately affected
by salaries paid to those executives with extensive years of service to the
Company. Upon review of the competitive market, the Compensation Committee
granted increases of five percent of salary in March 1993, to Messrs. Alexander
and Krinsly, taking into account that their last increases had been granted two
years earlier. Certain other executive officers were also granted salary
increases during 1993, commensurate with competitive salary levels at other
companies and changes in areas of responsibility. The Compensation Committee has
determined that the current base salaries of executive officers are reasonable
in comparison with companies in similar businesses and of comparable size and
considering the contributions, experience and tenure of the Company's executive
officers.
Effective January 1, 1994, Section 162(m) of the Internal Revenue Code
imposes new conditions and limitations on the deductibility of the compensation
paid to certain executive officers of public companies. Henceforth, compensation
of executive officers who are required to be listed in the Summary Compensation
Table (a 'named executive officer') shall not be deductible by the Company for
tax purposes to the extent that it exceeds $1.0 million, unless specific
criteria have been met. In an effort to minimize the adverse consequences of
this legislation, the Company is seeking shareholder approval at this Annual
Meeting of Stockholders of its Management Incentive Bonus Plan for Corporate
Executive Officers. The corporate executive officers of the Company consist of
the Chairman/Chief Executive Officer, President/Chief Operating Officer, Senior
Executive Vice President/General Counsel and the Executive Vice President,
Finance and Administration (the 'corporate executive officers'). Approval of
this plan will permit any future bonus payment to a corporate executive officer
to be tax deductible even though it raises total compensation above $1.0
million. However, that portion of any named executive officer's base salary that
is in excess of $1.0 million shall not be tax deductible by the Company
commencing in 1994.
The Company's annual incentive bonus plans seek to motivate and reward
executives by recognizing their accomplishments during the previous year. In the
main, financial performance of the Company or of a particular division is used
to establish bonus eligibility for executive officers. Bonus criteria has
historically been shaped in accordance with attainment of targeted financial
objectives, including operating profit, return on net assets and operating cash
flow, which fell below anticipated levels in 1993 on a consolidated basis (but
which were achieved by certain operating units). These measurements are
determined at the commencement of each fiscal year and are approved by senior
management and the Compensation Committee. The Compensation Committee, however,
retains discretion to recognize an executive's response to unplanned business
events or opportunities, with the exception of corporate executive officers.
Bonus consideration for the Chief Executive Officer and the other corporate
executive officers with respect to 1993 was exclusively based upon Company
earnings performance; since minimum consolidated financial targets were not
achieved, individual performance did not enter into the determination.
Accordingly, no bonus was awarded to the Chief Executive Officer or any other
corporate executive officer with respect to 1993. Only those operating executive
officers whose division
15
<PAGE>
results met or exceeded the predetermined financial performance criteria that
had been specifically established for them were awarded bonuses.
During 1993, stock options were granted to all of the named executive
officers of the Company. The Compensation Committee determined that these grants
were desirable in order for the Company to remain competitive, since options
were last granted five years ago (with the exception of Mr. Quicke) and had
expired unexercised. Such awards were determined as to size based upon salary
levels together with comparative data assembled from many of the same surveyors
utilized for salary analyses. According to such data, the size of option awards
for Sequa's executive officers was below the level of average option awards for
similar companies.
Although 1993 was a year of extraordinary challenge for the Company, the
Compensation Committee believes that the surest test of executive skill is
achievement during periods of difficulty. The Compensation Committee is
satisfied that the total compensation packages provided to the Company's
executive officers are competitive without being excessive and are appropriate
in order to retain and motivate the highly skilled and experienced individuals
vital to Sequa's long-term success.
Gerald Tsai, Jr., Chairman
A. Leon Fergenson
Donald D. Kummerfeld
16
<PAGE>
PROPOSED MANAGEMENT INCENTIVE BONUS PLAN FOR
CORPORATE EXECUTIVE OFFICERS
The Board of Directors has accepted the recommendation of the Compensation
Committee to adopt a new Management Incentive Bonus Plan for corporate executive
officers and corporate staff (the 'Plan'), subject to shareholder approval of
that portion of the Plan that applies to corporate executive officers. This Plan
is intended to address the contributions of corporate executive officers and to
provide an equitable method of rewarding such contributions. The Plan seeks to
retain, motivate and reward participants based on the financial performance of
continuing operations of the Company. The corporate executive officers consist
of the Chairman/Chief Executive Officer, President/Chief Operating Officer,
Senior Executive Vice President/General Counsel and Executive Vice President,
Finance and Administration.
The Plan provides for a bonus to be paid to the corporate executive
officers based solely on the Company's achieving or surpassing certain targets
related to budgeted earnings per share from continuing operations (EPS). The
Plan refers to the attainment of budgeted EPS as 'par performance'. The budgeted
EPS shall, for purposes of this Plan, be a number agreed to at the beginning of
each year by the Compensation Committee (which consists solely of outside
directors), taking into account a host of factors including past performance,
industry trends and projected levels of achievement. The actual EPS for the past
year will be calculated at the beginning of the next fiscal year in reliance
upon the unaudited financial statements of the Company (which shall contain all
adjustments necessary to fairly present the Company's results for the year then
ended). Prior to any bonus payments under the Plan, the Compensation Committee
must certify that the required EPS has been achieved. Certain minimum bonus
payments will be made to corporate executive officers if eighty-five percent
(85%) of budgeted EPS is reached, and higher bonus payments will be made if
budgeted EPS is exceeded. The maximum bonus payable to the Chief Executive
Officer is 97.5% of his then current salary (see table below for the maximum
percentages of salary payable to each corporate executive officer). Proposed tax
regulations require that the maximum bonus payable to any relevant participant
in this Plan be specified; accordingly, if one assumes, purely for purposes of
this calculation, a maximum cumulative increase of ten percent annually of the
current salary ($1,052,005) of the Chief Executive Officer over a five year
period ($1,694,264), then the maximum bonus payable to him under this Plan in
year five would be $1,651,907. Attainment of individual performance goals is not
calculated into the bonus formula for corporate executive officers; rather,
their bonus eligibility is exclusively dependent upon consolidated earnings
performance of the Company. Other executive officers who head distinct operating
companies or divisions, such as Messrs. Weinstein and Savoca, participate in
separate plans designed to reflect the appropriate performance targets of their
respective operations.
This Plan may not be substantively amended as it applies to corporate
executive officers except by a vote of the shareholders of the Company. No bonus
payments shall be made to corporate executive officers of the Company unless
this Plan is approved by the shareholders.
17
<PAGE>
The following table estimates the range of bonus payments under the
proposed Plan for the corporate executive officers. Under the proposed Plan, no
bonus payments would have been made with respect to 1993 to any corporate
executive officer, since the Company did not attain minimum EPS.
NEW PLAN BENEFITS
<TABLE>
<CAPTION>
POTENTIAL
BONUS POTENTIAL BONUS
PAYMENT AS A % POTENTIAL PAYMENT AS A % OF
OF SALARY AT BONUS PAYMENT SALARY AT
MINIMUM AS A % OF OUTSTANDING
PERFORMANCE SALARY AT PAR PERFORMANCE BY
BY THE COMPANY PERFORMANCE THE COMPANY (115%
(85% OF BY THE COMPANY OR MORE
NAME OF INDIVIDUAL POSITION BUDGETED EPS) (BUDGETED EPS) OF BUDGETED EPS)
- --------------------------------------- ---------------------------- -------------- -------------- -----------------
<S> <C> <C> <C> <C>
Norman E. Alexander.................... Chairman and Chief Executive 32.5% 65% 97.5%
Officer
John J. Quicke......................... President and Chief 30% 60% 90%
Operating Officer
Stuart Z. Krinsly...................... Senior Executive Vice 27.5% 55% 82.5%
President and General
Counsel
Gerald S. Gutterman.................... Executive Vice President, 27.5% 55% 82.5%
Finance and Administration
</TABLE>
- ------------
Note: The percentage of salary payable increases incrementally as the EPS moves
from 85% up to par performance, and likewise, between par and 115%. The
potential bonus payment shown at 115% of budgeted EPS is the maximum
available regardless of how high the EPS actually goes. For 1994 only, the
Plan provides that corporate executive officers shall only be entitled to
the maximum bonus if 150% or more of budgeted EPS is achieved.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE 'FOR'
APPROVAL OF THE MANAGEMENT INCENTIVE BONUS PLAN FOR CORPORATE EXECUTIVE
OFFICERS.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The stockholders will be asked to ratify the appointment of Arthur Andersen
& Co. as independent public accountants of the Company for the fiscal year 1994.
Arthur Andersen & Co. has been regularly employed as the independent auditors
for the Company since 1940. Representatives of the firm are expected to be
present at the stockholders' meeting with the opportunity to make a statement if
they desire to do so, and are expected to be available to respond to appropriate
questions.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU
VOTE 'FOR' THE RATIFICATION OF THE APPOINTMENT OF THE ABOVE AUDITORS.
18
<PAGE>
OTHER MATTERS
The management of the Company knows of no business other than that referred
to herein to be presented for action at the meeting. If, however, any other
business should properly come before the meeting or any adjournment thereof, it
is intended that all proxies will be voted with respect to such business in
accordance with the best judgment of the persons named in said proxies.
PROPOSALS OF STOCKHOLDERS FOR THE 1995 ANNUAL MEETING
Proposals by stockholders intended to be presented for action at the 1995
annual meeting of stockholders must be received by the Company at its principal
executive offices, 200 Park Avenue, New York, New York 10166, not later than
December 1, 1994. It is suggested that such proposals be submitted by Certified
Mail-Return Receipt Requested.
March 25, 1994
19
<PAGE>
['RECYCLED'LOGO] PRINTED ON RECYCLED PAPER
<PAGE>
APPENDIX
Graphic and Image Information:
See the narrative description of the performance graph on page 14 of this
electronic filing.
<PAGE>
STATEMENT OF DIFFERENCES
THE SECTION SYMBOL SHALL BE EXPRESSED AS SS.
<PAGE>
SEQUA CORPORATION
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Sequa Corporation -- May 12, 1994 at 11:00 A.M., in Conference
Room 7 on the 11th floor, 270 Park Avenue, New York, New York.
The undersigned hereby appoints Norman E. Alexander, Stuart Z. Krinsly and
A. Leon Fergenson, and any one or more of them, attorneys and proxies, with full
power of substitution and revocation in each, for and on behalf of the
undersigned, and with all the powers the undersigned would possess if personally
present, to vote at the above Annual Meeting and any adjournment thereof all
shares of Common and Preferred Stock of Sequa Corporation that the undersigned
would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
<PAGE>
<TABLE>
<S> <C>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE [X] PLEASE MARK
STOCKHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, YOUR VOTES
SUCH SHARES WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR ITEMS 2 AND 3. AS THIS
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
WILL ATTEND
Account Number Class A Common Class B Common Preferred [ ]
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES IN ITEM 1 AND FOR
ITEMS 2 AND 3
Item 1 -- Election of the following nominees as Directors: Messrs. Alexander,
Dworman, Fergenson, Gottesman, Krinsly, Kummerfeld, LeFrak, Quicke,
Sullivan and Tsai.
<TABLE>
<S> <C> <C> <C>
FOR all WITHHELD for WITHHELD for the following only:
Nominees all Nominees (Write the name of the nominee(s) in the space below)
[ ] [ ]
</TABLE>
Item 2 -- Approval of the Management Incentive
Bonus Plan for Corporate Executive Officers.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 3 -- Appointment of Independent Auditors.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 4 -- In their discretion, the proxies are
authorized to vote upon such other matters as
may properly come before the meeting.
<TABLE>
<S> <C>
SIGNATURE(S) DATE
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH. IF THE SIGNER IS A CORPORATION, PLEASE SIGN THE
FULL CORPORATE NAME, BY DULY AUTHORIZED OFFICER. IF SHARES ARE HELD JOINTLY,
EACH STOCKHOLDER NAMED SHOULD SIGN.
</TABLE>
<PAGE>
EMPLOYEE PLANS
SEQUA CORPORATION
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Sequa Corporation -- May 12, 1994 at 11:00 A.M., in Conference
Room 7 on the 11th floor, 270 Park Avenue, New York, New York.
The undersigned hereby appoints Norman E. Alexander, Stuart Z. Krinsly and
A. Leon Fergenson, and any one or more of them, attorneys and proxies, with full
power of substitution and revocation in each, for and on behalf of the
undersigned, and with all the powers the undersigned would possess if personally
present, to vote at the above Annual Meeting and any adjournment thereof all
shares of Class A Common and/or Preferred Stock of Sequa Corporation that the
undersigned would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
<PAGE>
<TABLE>
<S> <C>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE [X] PLEASE MARK
STOCKHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, YOUR VOTES
SUCH SHARES WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR ITEMS 2 AND 3. AS THIS
</TABLE>
<TABLE>
<S> <C> <C>
WILL ATTEND
Account Number [ ]
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES IN ITEM 1 AND FOR
ITEMS 2 AND 3
Item 1 -- Election of the following nominees as Directors: Messrs. Alexander,
Dworman, Fergenson, Gottesman, Krinsly, Kummerfeld, LeFrak, Quicke,
Sullivan and Tsai.
<TABLE>
<S> <C> <C> <C>
FOR all WITHHELD for WITHHELD for the following only
Nominees all Nominees (Write the name of the nominee(s) in the space below)
[ ] [ ]
</TABLE>
Item 2 -- Approval of the Management Incentive
Bonus Plan for Corporate Executive Officers.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 3 -- Appointment of Independent Auditors.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 4 -- In their discretion, the proxies are
authorized to vote upon such other matters as
may properly come before the meeting.
<TABLE>
<S> <C>
SIGNATURE(S) DATE
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH. IF THE SIGNER IS A CORPORATION, PLEASE SIGN THE
FULL CORPORATE NAME, BY DULY AUTHORIZED OFFICER. IF SHARES ARE HELD JOINTLY,
EACH STOCKHOLDER NAMED SHOULD SIGN.
</TABLE>
<PAGE>
SEQUA CORPORATION
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Sequa Corporation -- May 12, 1994 at 11:00 A.M., in Conference
Room 7 on the 11th floor, 270 Park Avenue, New York, New York.
The undersigned hereby appoints Norman E. Alexander, Stuart Z. Krinsly and
A. Leon Fergenson, and any one or more of them, attorneys and proxies, with full
power of substitution and revocation in each, for and on behalf of the
undersigned, and with all the powers the undersigned would possess if personally
present, to vote at the above Annual Meeting and any adjournment thereof all
shares of Common and/or Preferred Stock of Sequa Corporation that the
undersigned would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
A-PF
<PAGE>
<TABLE>
<S> <C>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE [X] PLEASE MARK
STOCKHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, YOUR VOTE
SUCH SHARES WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR ITEMS 2 AND 3. AS THIS
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C>
WILL ATTEND
Account Number Class A Common Class B Common Preferred [ ]
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES IN ITEM 1 AND FOR
ITEMS 2 AND 3
Item 1 -- Election of the following nominees as Directors: Messrs. Alexander,
Dworman, Fergenson, Gottesman, Krinsly, Kummerfeld, LeFrak, Quicke,
Sullivan and Tsai.
<TABLE>
<S> <C> <C> <C>
FOR all WITHHELD for WITHHELD for the following only:
Nominees all Nominees (Write the name of the nominee(s) in the space below)
[ ] [ ]
</TABLE>
Item 2 -- Approval of the Management Incentive
Bonus Plan for Corporate Executive Officers.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 3 -- Appointment of Independent Auditors.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 4 -- In their discretion, the proxies are
authorized to vote upon such other matters as
may properly come before the meeting.
<TABLE>
<S> <C>
SIGNATURE(S) DATE
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH. IF THE SIGNER IS A CORPORATION, PLEASE SIGN THE
FULL CORPORATE NAME, BY DULY AUTHORIZED OFFICER. IF SHARES ARE HELD JOINTLY,
EACH STOCKHOLDER NAMED SHOULD SIGN.
</TABLE>
<PAGE>
SEQUA CORPORATION
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Sequa Corporation -- May 12, 1994 at 11:00 A.M., in Conference
Room 7 on the 11th floor, 270 Park Avenue, New York, New York.
The undersigned hereby appoints Norman E. Alexander, Stuart Z. Krinsly and
A. Leon Fergenson, and any one or more of them, attorneys and proxies, with full
power of substitution and revocation in each, for and on behalf of the
undersigned, and with all the powers the undersigned would possess if personally
present, to vote at the above Annual Meeting and any adjournment thereof all
shares of Common and/or Preferred Stock of Sequa Corporation that the
undersigned would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
CL-B
<PAGE>
<TABLE>
<S> <C>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE [X] PLEASE MARK
STOCKHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, YOUR VOTE
SUCH SHARES WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR ITEMS 2 AND 3. AS THIS
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C>
WILL ATTEND
Account Number Class A Common Class B Common Preferred [ ]
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES IN ITEM 1 AND FOR
ITEMS 2 AND 3
Item 1 -- Election of the following nominees as Directors: Messrs. Alexander,
Dworman, Fergenson, Gottesman, Krinsly, Kummerfeld, LeFrak, Quicke,
Sullivan and Tsai.
<TABLE>
<S> <C> <C> <C>
FOR all WITHHELD for WITHHELD for the following only:
Nominees all Nominees (Write the name of the nominee(s) in the space below)
[ ] [ ]
</TABLE>
Item 2 -- Approval of the Management Incentive
Bonus Plan for Corporate Executive Officers.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 3 -- Appointment of Independent Auditors.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 4 -- In their discretion, the proxies are
authorized to vote upon such other matters as
may properly come before the meeting.
<TABLE>
<S> <C>
SIGNATURE(S) DATE
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH. IF THE SIGNER IS A CORPORATION, PLEASE SIGN THE
FULL CORPORATE NAME, BY DULY AUTHORIZED OFFICER. IF SHARES ARE HELD JOINTLY,
EACH STOCKHOLDER NAMED SHOULD SIGN.
</TABLE>
<PAGE>
SEQUA CORPORATION
Solicited by the Board of Directors for use at the Annual Meeting of
Stockholders of Sequa Corporation -- May 12, 1994 at 11:00 A.M., in Conference
Room 7 on the 11th floor, 270 Park Avenue, New York, New York.
The undersigned hereby appoints Norman E. Alexander, Stuart Z. Krinsly and
A. Leon Fergenson, and any one or more of them, attorneys and proxies, with full
power of substitution and revocation in each, for and on behalf of the
undersigned, and with all the powers the undersigned would possess if personally
present, to vote at the above Annual Meeting and any adjournment thereof all
shares of Common and/or Preferred Stock of Sequa Corporation that the
undersigned would be entitled to vote at such meeting.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
UNX
<PAGE>
<TABLE>
<S> <C>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE [X] PLEASE MARK
STOCKHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED, YOUR VOTE
SUCH SHARES WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR ITEMS 2 AND 3. AS THIS
</TABLE>
<TABLE>
<S> <C> <C>
WILL ATTEND
Account Number [ ]
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES IN ITEM 1 AND FOR
ITEMS 2 AND 3
Item 1 -- Election of the following nominees as Directors: Messrs. Alexander,
Dworman, Fergenson, Gottesman, Krinsly, Kummerfeld, LeFrak, Quicke,
Sullivan and Tsai.
<TABLE>
<S> <C> <C> <C>
FOR all WITHHELD for WITHHELD for the following only
Nominees all Nominees (Write the name of the nominee(s) in the space below)
[ ] [ ]
</TABLE>
Item 2 -- Approval of the Management Incentive
Bonus Plan for Corporate Executive Officers.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 3 -- Appointment of Independent Auditors.
<TABLE>
<S> <C> <C>
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
Item 4 -- In their discretion, the proxies are
authorized to vote upon such other matters as
may properly come before the meeting.
<TABLE>
<S> <C>
SIGNATURE(S) DATE
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH. IF THE SIGNER IS A CORPORATION, PLEASE SIGN THE
FULL CORPORATE NAME, BY DULY AUTHORIZED OFFICER. IF SHARES ARE HELD JOINTLY,
EACH STOCKHOLDER NAMED SHOULD SIGN.
</TABLE>
<PAGE>
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
<TABLE>
<S> <C>
[POSTAL INDICIA]
BUSINESS REPLY MAIL
FIRST CLASS PERMIT NEW YORK, N.Y.
POSTAGE WILL BE PAID BY ADDRESSEE
SEQUA CORPORATION
ATTN: CORPORATE SECRETARY
200 PARK AVENUE
NEW YORK, NY 10166
</TABLE>
<PAGE>
SEQUA CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
May 12, 1994 11:00 a.m.
270 Park Avenue
Conference Room 7, 11th Floor
New York, New York 10166
If you plan to attend the Annual Meeting, please sign and return the
self-addressed, postage paid portion of this card.
You will need to present this portion of the card in order to be admitted to the
Sequa Annual Meeting on May 12, 1994.
I Plan to attend the Annual Meeting of Stockholders of
Sequa Corporation on May 12, 1994.
- ------------------------------------------------------
Signature
- ------------------------------------------------------
Please print/type full name as it appears on proxy card
Address:
- ------------------------------------------------------
- ------------------------------------------------------
Stock Ownership: Class A Class B Preferred
PLEASE CHECK ONE
<PAGE>
SEQUA CORPORATION
MANAGEMENT INCENTIVE
BONUS PROGRAM
CORPORATE EXECUTIVE OFFICERS
AND
CORPORATE STAFF
<PAGE>
INDEX
<TABLE>
<S> <C>
I. General Outline
II. Bonus Program
III. Policies & Procedures
IV. Exhibits
</TABLE>
2
<PAGE>
SEQUA CORPORATION
MANAGEMENT INCENTIVE BONUS PROGRAM
GENERAL OUTLINE
The purpose of implementing Sequa Corporation's Management Incentive Bonus
Program (MIBP) is to improve the Company's performance through the efforts of
key executives and management personnel who are in position to significantly
contribute to operating results.
Specific financial and performance goals will be established in the
beginning of the plan year for all MIBP participants, with the exception of
Corporate Executive Officers, who will be measured exclusively on attainment of
the financial goal.
The MIBP will provide substantial rewards for non-executive officer
participants who accomplish or exceed targeted goals at the end of the plan
year. The bonus paid to each such participant will be based on a combination of
(a) the overall financial performance of the company and (b) performance
consideration by executive management. The Corporate Executive Officers' bonuses
will be certified by the Compensation Committee of The Board of Directors after
completion of the fiscal year provided that the required financial goals (as set
forth in the exhibits to this plan) have been met.
I. MIBP PARTICIPANTS AND POTENTIAL PAYOUT LEVELS (PERCENTAGE OF SALARY)
<TABLE>
<CAPTION>
MAXIMUM BONUS
MINIMUM BONUS BONUS LEVEL LEVEL
LEVEL ('PAR' (OUTSTANDING
(MINIMUM PERFORMANCE) PERFORMANCE)
PERFORMANCE) (100% OF (115% OF
PARTICIPANTS (85% OF PLAN) PLAN) PLAN)*
- -------------------------------------------------------------- ------------- ------------ -------------
<S> <C> <C>
Chief Executive Officer....................................... 32.5% 65% 97.5%
President..................................................... 30% 60% 90.0%
Senior Executive VP and General Counsel....................... 27.5% 55% 82.5%
Executive VP, Finance and Administration...................... 27.5% 55% 82.5%
Corporate Officers............................................ 25% 50% 75%
Directors (A-Pool)............................................ 15% 30% 45%
Managers and Professionals (B-Pool)........................... Up to 15% Up to 15% Up to 15%
</TABLE>
- ------------
* For 1994 only, outstanding performance will require 150% of Plan.
II. PARTICIPANT BONUS FORMULA
Participant's total bonus will be based on the following breakdown:
Corporate Executive Officers
A. 100% -- achievement of Company financial goal.
Corporate Officers
A. 75% -- achievement of Company financial goal.
B. 25% -- achievement of individual performance goals.
3
<PAGE>
Directors (A-Pool)
A. 50% -- achievement of Company financial goal.
B. 50% -- achievement of individual performance goals.
Managers and Professionals (B-Pool)
A. 25% -- achievement of Company financial goal.
B. 75% -- achievement of individual performance goals.
4
<PAGE>
CORPORATE
MANAGEMENT INCENTIVE BONUS PROGRAM
I. PARTICIPANTS
A. Corporate Executive Officers
1. For purposes of this plan, Corporate Executive Officers shall
consist of the Chief Executive Officer, the President, the Senior Executive
Vice President and General Counsel, and the Executive Vice President,
Finance and Administration and such other senior officers of the
Corporation as the Board of Directors shall designate from time to time.
B. Corporate Officers
These include all corporate officers who are not Corporate Executive
Officers.
C. Corporate Vice Presidents will establish a list of A-Pool (Director) and
B-Pool (Manager and Professional) participants in accordance with the following
guidelines:
1. A-Pool participation shall consist of:
First level managers who are not otherwise Corporate Officers
reporting directly to a Corporate Vice President.
Certain first-level managers may be excluded if the reporting
relationship is due to special reasons.
Certain second-level managers may be included if the
responsibilities of their position warrant participation at the A-Pool
level.
2. B-Pool participation shall consist of:
Select Manager and Professional level employees who are in a
position to influence earnings through sustained performance.
3. Prior to January 1st of each year, the recommended lists of
participants are to be submitted by the Corporate Vice Presidents to the
Chief Executive Officer, President and the Vice President, Human Resources
for their approval.
D. Any organizational changes during the year which impact on participation
will be reviewed and approved by the Chief Executive Officer, President and the
Vice President, Human Resources.
II. CORPORATE GOALS
A. Financial goal:
1. The financial goal for this Management Incentive Bonus Plan will be
budgeted Earnings Per Share from Continuing Operations of the Company.
2. The achievement of the financial goal will be applied to all
participants according to the participants' bonus formula set forth in the
General Outline at II.
5
<PAGE>
B. Individual Performance Goals:
1. Performance goals for Corporate Vice Presidents will be agreed upon
with the appropriate Corporate Executive Officer.
2. Performance goals for Corporate Officers who are not Corporate Vice
Presidents and for A and B-Pool participants will be agreed upon with the
appropriate Corporate Vice President.
All goals will be reviewed by the Vice President Human Resources and
approved by the Chief Executive Officer or the President.
6
<PAGE>
POLICIES AND PROCEDURES
MANAGEMENT INCENTIVE BONUS PROGRAM
I. TIME OF PARTICIPATION
A. In order to participate in the MIBP, each participant must be in an
eligible position at the end of the plan year.
B. Any employee promoted or hired to a position included in the MIBP during
the plan year will be eligible to participate in the bonus program on a
pro-rated basis.
C. The plan year is the Company fiscal year.
II. BONUS PLAN REVIEWS
A. Once each quarter, the Chief Executive Officer or President, in
coordination with the Vice President Human Resources, will meet with each
Corporate Vice President to review performance goals for that Vice President and
his/her participant reports. Prior to these meetings the Corporate Vice
President will meet with his/her reports to review their performance goals.
III. DETERMINATION OF FINANCIAL AND PERFORMANCE RATINGS
A. Following the close of the plan year, the Executive Vice President,
Finance and Administration, will report to the Chief Executive Officer and the
President earnings per share from continuing operations. These calculations
shall be based upon the unaudited financial statements of the Company (which
shall contain all adjustments necessary to fairly present the Company's results
for the year then ended). Based on this result, the Executive Vice President,
Finance and Administration will calculate the financial rating for the Plan
using the format contained in Exhibit 1.A. This rating will be used to calculate
bonus awards for Corporate Executive Officers.
B. Performance ratings will be determined by appropriate Corporate
Executive Officers for their direct reports. Corporate Vice Presidents in
coordination with the appropriate Corporate Executive Officers will determine
performance ratings for their reports.
C. The Corporate Vice Presidents shall be advised of the financial rating
which shall be added to the performance rating calculated in III.B. The sum of
these ratings shall be the basis for calculating participant bonus payments.
IV. AWARD CALCULATION
A. Awards shall be calculated by the Corporate Executive Officers for their
direct reports and by Corporate Vice Presidents for their reports using the
format contained in Exhibit 1.
B. The Compensation Committee of The Board of Directors shall determine and
approve the awards for the Corporate Executive Officers. It shall review and
recommend to the Board of Directors proposed awards for all other Corporate
Officers.
C. The Board of Directors will approve payments to all other Corporate
Officers pursuant to the Plan.
7
<PAGE>
V. COMPANY PROFIT AND PLAN PAYOUT
Notwithstanding anything contained in this plan to the contrary, if there
is no company profit for the plan year, there will be no awards.
VI. FREQUENCY OF AWARDS
Bonus awards will be generated during the month of February for performance
in the previous plan year.
VII. CONTINGENCIES BEYOND PARTICIPANT'S CONTROL
In those instances where significant events affect the accomplishment of
individual performance goals for a participant, the Chief Executive Officer may
use his judgment regarding the amount of bonus to be awarded for this element of
the plan. Examples of such events could include: Labor disputes, acquisitions,
natural catastrophes. This shall not apply to awards to Corporate Executive
Officers.
VIII. FORFEITURE OF AWARD
A participant will not be eligible for consideration for an award if:
A. The participant is discharged for cause at any time prior to the
end of the plan year.
B. The participant voluntarily resigns prior to the end of the plan
year.
Any exception to this policy must be approved by the Chief Executive
Officer or President and Vice President, Human Resources.
IX. RETIREMENT, DISABILITY, NOT FOR CAUSE TERMINATION, OR DEATH DURING THE PLAN
YEAR
Any participant who retires, becomes permanently disabled, is terminated
other than for cause, or dies during the plan year shall be reviewed
individually to determine whether a bonus award is appropriate.
X. BUDGETING
The budget for Earnings Per Share from continuing operations shall include
the cost for 'Par' performance on both the financial and performance elements
for all participants in the Plan.
XI. AMENDMENTS
This plan may not be substantively amended except (i) with respect to
Corporate Executive Officers, by a vote of the shareholders of the Company, or
(ii) with respect to all other participants, by the Board of Directors of the
Company.
XII. DISCLAIMER
This plan shall neither create any right to a bonus payment or future
participation therein for any employee, nor limit the right of Sequa Corporation
to modify, amend or rescind this plan for any subsequent plan year. Nor shall it
be construed as creating any right to employment.
8
<PAGE>
EXHIBIT 1
DETERMINATION OF BONUS POINTS
A. FINANCIAL BONUS POINTS
For the Corporate staff to earn bonus points for financial objectives, the
Company must achieve a minimum of 85% of its approved budget for Earnings Per
Share (E.P.S.) from continuing operations. For each percentage point actual
E.P.S. results exceed 85% of budget, up to 115% (150% for 1994) of original
budget, participants earn additional bonus points. The following table details
bonus points earned upon achievement of the 85% of E.P.S. as well as points
earned for each 1% over the 85% level up to par, and for each 1% over par up to
115% (150% for 1994) of par for each level of participant.
<TABLE>
<CAPTION>
FINANCIAL POINTS EARNED
--------------------------------------------------------
FOR EACH 1% FOR EACH 1%
OVER OVER PAR FOR EACH 1%
MINIMUM UP 1995 AND OVER PAR
FOR MINIMUM TO PAR BEYOND 1994
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Chief Executive Officer.................... 32.5 2.167 2.167 .65
President.................................. 30.0 2.0 2.0 .60
Sr. Exec. Vice Pres. & General Counsel..... 27.5 1.833 1.833 .55
Executive Vice President Finance........... 27.5 1.833 1.833 .55
Corporate Officers......................... 18.75 1.25 2.5 .75
A-Pool..................................... 12.5 0.833 1.67 .50
B-Pool..................................... 06.25 0.416 0.833 .25
</TABLE>
B. Examples of financial point calculations at $1.90, $2.00 and $2.20
E.P.S. vs a budget of $2.00 follows:
<TABLE>
<CAPTION>
ACTUAL
---------------------------------
1995
AND
BEYOND 1994
------ -----
1.90 2.00 2.20 2.20
----- ----- ------ -----
<S> <C> <C> <C> <C>
Chief Executive Officer
Minimum points............................................. 32.5 32.5 32.5 32.5
% over minimum
1.90/2.00 = 95% - 85%
10% X 2.167............................... 21.7
2.00/2.00 = 100% - 85%
15% X 2.167............................... 32.5
2.20/2.00 = 110% - 85%
25% X 2.167............................... 54.2
1994 calculation:
15% X 2.167...................................... 32.5
10% X .65........................................ 6.5
----- ----- ------ -----
Total financial points earned.............................. 54.2 65.0 86.7 71.5
</TABLE>
Since Corporate Executive officers are paid exclusively on financial
performance, the above results would be the bonus payout percentages.
<PAGE>
<TABLE>
<CAPTION>
ACTUAL
---------------------------------
1995
AND
BEYOND 1994
------ -----
1.90 2.00 2.20 2.20
----- ----- ------ -----
<S> <C> <C> <C> <C>
Corporate Officers*
Minimum points............................................. 18.75 18.75 18.75 18.75
% over minimum/par
$1.90 = 10 X 1.25................................ 12.50
$2.00 = 15 X 1.25................................ 18.75
$2.20 = 15 X 1.25................................ 18.75
10 X 2.5................................ 25.00
1994 calculation:
15 X 1.25........................................ 18.75
10 X .75......................................... 7.5
----- ----- ------ -----
31.25 37.50 62.50 45.00
<CAPTION>
ACTUAL
---------------------------------
1995
AND
BEYOND 1994
------ -----
1.90 2.00 2.20 2.20
----- ----- ------ -----
<S> <C> <C> <C> <C>
A-Pool
Minimum points............................................. 12.5 12.5 12.5 12.5
% over minimum
1.90/2.00 = 95% - 85%
10% X .833................................ 8.3
2.00/2.00 = 100% - 85%
15% X .833................................ 12.5
2.20/2.00 = 110% - 85%
15% X .833................................ 12.5
10% X 1.67................................ 16.7
1994 calculation:
15% X .833....................................... 12.5
10% X .50........................................ 5.0
----- ----- ------ -----
Total financial points earned.............................. 20.8 25.0 41.7 30.0
</TABLE>
- ------------
* Based on point allocations as set forth on Exhibit 2
<PAGE>
C. PERFORMANCE BONUS POINTS
Since Corporate Officers' bonus payments are based 75% on financial results
and 25% on performance, the points calculated above would be combined with the
performance points awarded in determining the bonus award. For example -- if the
Vice President was earning $200,000 and received 12.5 points for performance,
the bonus would be calculated as follows for each of the earnings levels.
<TABLE>
<S> <C> <C>
@ $1.90 31.25 pts. + 12.5 pts. = 43.75 pts.
43.75 pts. X 1% = 43.75%
43.75% X $200,000 = $87,500
@ $2.00 37.5 pts. + 12.5 pts. = 50 pts.
50 pts. X 1% = 50%
50% X $200,000 = $100,000
1995 and Beyond @ $2.20 62.5 pts. + 12.5 pts. = 75 pts.
(50 pts. X 1%) + (25 pts. X .5%) = 62.5%
62.5% X $200,000 = $125,000
1994 @ $2.20 45.0 pts. + 12.5 pts. = 57.5 pts.
(50 pts. X 1%) + (7.5 pts. X .5%) = 53.75%
53.75% X $200,000 = $107,500
</TABLE>
Since A-Pool bonus payments are based 50% on financial results and 50% on
performance, the points calculated above would be combined with the performance
points awarded in determining the bonus award. For example -- if the participant
was earning $100,000 and received 25 points for performance, the bonus would be
calculated as follows for each of the earnings levels.
<TABLE>
<S> <C> <C>
@ $1.90 20.8 pts. + 25 pts. = 45.8 pts.
45.8 pts. X .6% = 27.5%
27.5% X $100,000 = $27,500
@ $2.00 25 pts. + 25 pts. = 50 pts.
50 pts. X .6% = 30%
30% X $100,000 = $30,000
1995 and Beyond @ $2.20 41.7 pts. + 25 pts. = 66.7 pts.
(50 pts. X .6%) + (16.7 pts. X .3%) = 35%
35% X $100,000 = $35,000
1994 @ $2.20 30.0 pts. + 25 pts. = 55.0 pts.
(50 pts. X .6%) + (5.0 pts. X .3%) = 31.5%
31.5% X $100,000 = $31,500
</TABLE>