<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Transamerica Corporation
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(Name of Registrant as Specified In Its Charter)
Transamerica Corporation
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
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Transamerica
LOGO Corporation
600 Montgomery Street
San Francisco,
California 94111
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Thursday, April 25, 1996
11:00 A.M.
To The Stockholders:
The Annual Meeting of Stockholders of Transamerica Corporation will be held
at the Giannini Auditorium, Concourse Level, Bank of America Center, 555
California Street, San Francisco, California, on Thursday, April 25, 1996, at
11:00 A.M., for the purpose of:
1.Electing three directors of the Corporation to hold office for three-year
terms;
2.Electing independent auditors to audit the financial statements of the
Corporation for 1996; and
3.Acting upon a stockholder resolution if properly presented at the meeting.
All other matters which may properly come before the meeting and any
adjournment thereof will also be considered.
Stockholders of record at the close of business on March 5, 1996 are
entitled to notice of, and to vote at, the meeting and any adjournment
thereof. A list of such stockholders will be available at the time and place
of the meeting and, for any purpose germane to the meeting, during the ten
days prior to the meeting, at the office of the Secretary of the Corporation,
600 Montgomery Street, San Francisco, California, during ordinary business
hours.
By Order of the Board of Directors
Shirley H. Buccieri
Secretary
San Francisco, California
March 18, 1996
<PAGE>
PROXY STATEMENT
OF
TRANSAMERICA CORPORATION
600 MONTGOMERY STREET
SAN FRANCISCO, CALIFORNIA 94111
INFORMATION CONCERNING THE SOLICITATION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors of Transamerica Corporation of proxies to be voted at the
Annual Meeting of Stockholders to be held on April 25, 1996 and at any
adjournment thereof. Proxies are revocable at any time prior to exercise by
written notice to the Secretary of the Corporation or upon request if the
stockholder is present at the Annual Meeting and chooses to vote in person. If
a proxy is properly signed and not revoked, the shares it represents will be
voted in accordance with the instructions of the stockholder. If no specific
instructions are given, the shares represented by the proxy will be voted for
the election of directors, for Proposal 2 and against Proposal 3.
Stockholders of record at the close of business on March 5, 1996 are
entitled to vote at the Annual Meeting. On that date the Corporation had
outstanding 67,615,621 shares of common stock, $1 par value, each share being
entitled to one vote and each one-half share being entitled to one-half vote.
A proxy given by any stockholder participating in the Corporation's Dividend
Reinvestment Plan or in the Corporation's Employees Stock Savings Plan will
govern the voting of all full shares held for such stockholder's account under
those Plans.
A majority of the shares entitled to vote, represented in person or by
proxy, constitutes a quorum. Abstentions and broker non-votes are counted as
shares present in determining whether the quorum requirement is satisfied.
With regard to the election of directors, if a quorum is present, a plurality
vote of the shares of common stock of the Corporation present in person or by
proxy at the Annual Meeting and entitled to vote will be required for the
election of directors. If a quorum is present, the affirmative vote of the
holders of a majority of the shares of common stock of the Corporation present
in person or by proxy at the Annual Meeting and entitled to vote will be
required for the election of independent auditors and approval of Proposal 3.
Votes may be cast "For" or "Withheld" for each director nominee; votes that
are withheld will be excluded entirely from the vote and will have no effect.
Abstentions may be specified on all proposals, except the election of
directors. Abstentions on Proposals 2 and 3 will have the same legal effect as
negative votes. Under the rules of the New York Stock Exchange, brokers who
hold shares in street name have the authority to vote in their discretion on
"routine" items when they have not received instructions from beneficial
owners. With respect to "non-routine" items, no broker may vote shares held
for customers without specific instructions from such customers. Under
Delaware law, a broker non-vote will have no effect on the outcome of "non-
routine" items requiring the affirmative vote of a majority of the shares
represented at the Annual Meeting and entitled to vote thereon.
The cost of soliciting proxies will be borne by the Corporation. The
Corporation will reimburse brokerage firms, banks and other nominees,
custodians and fiduciaries for their reasonable expenses incurred in sending
proxy material to beneficial owners of shares and obtaining their
instructions. Regular employees of the Corporation may solicit proxies
personally, by mail or by telephone. In addition, the Corporation has retained
Georgeson & Co., Inc. to assist in the distribution of the proxies and proxy
statements for a fee estimated not to exceed $16,000 plus out-of-pocket
expenses.
The Corporation has a policy that provides for the confidentiality of
stockholder proxies, ballots and vote tabulations, subject to certain
exceptions. The policy also provides for the tabulation of the vote by an
independent third party.
This proxy statement, the proxy and the Corporation's 1995 Annual Report
were first mailed to stockholders on March 18, 1996.
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(1) ELECTION OF DIRECTORS
INFORMATION CONCERNING THE NOMINEES AND CURRENT DIRECTORS
The Corporation's Certificate of Incorporation provides that the members of
the Board of Directors shall be divided into three classes with approximately
one-third of the directors to stand for election each year for three-year
terms. The total number of directors is currently set pursuant to the
Corporation's By-Laws at ten. Of this number, three members of the Board of
Directors have terms expiring, and are nominees for election, at the 1996
Annual Meeting of Stockholders. Mr. Myron Du Bain, whose term as a director
expires at the 1996 Annual Meeting of Stockholders, will be retiring from the
Board of Directors and will not stand for re-election. Three members have
terms expiring at the 1997 Annual Meeting of Stockholders and three members
have terms expiring at the 1998 Annual Meeting of Stockholders. The number of
directors will be reduced to nine upon Mr. Du Bain's retirement.
Unless instructions to the contrary are given, all proxies received by the
Corporation will be voted for the election of the three nominees named below
as directors of the Corporation to hold office until the 1999 Annual Meeting
of Stockholders and until their respective successors are elected and
qualified. All of the nominees have indicated a willingness to serve as
directors if elected. Should any nominee not be a candidate at the 1996 Annual
Meeting, all such proxies so received will be voted in favor of the other
nominees and for such substitute nominee (if any) as shall be designated by
the proxies named in the enclosed form of proxy, or the number of directors
may be reduced by the Board of Directors. All nominees have been recommended
by the Board of Directors for three-year terms expiring at the 1999 Annual
Meeting of Stockholders.
Certain information concerning each of the three nominees for directors, and
each current director in the classes continuing in office, is set forth below.
NOMINEES FOR DIRECTORS FOR THREE YEAR TERMS EXPIRING IN 1999
SAMUEL L. GINN*Director since 1989 Age 58
Chairman of the Board, Chief Executive Officer and a director of AirTouch
Communications, Inc., a worldwide wireless telecommunications company, since
1994. He was Chairman of the Board, President, Chief Executive Officer and a
director of Pacific Telesis Group, a diversified telecommunications company,
from 1988 to 1994. He also serves as a director of Chevron Corporation,
Safeway Inc. and Hewlett-Packard Company.
FRANK C. HERRINGER* Director since 1986 Age 53
Chairman of the Board, Chief Executive Officer and President of the
Corporation. He has been Chairman since January 1, 1996, Chief Executive
Officer since 1991 and President since 1986. He also serves as a director of
all major subsidiaries of the Corporation, Pacific Telesis Group and Unocal
Corporation.
CHARLES R. SCHWAB* Director since 1989 Age 58
Chairman of the Board, Chief Executive Officer and a director of The Charles
Schwab Corporation, a discount brokerage firm. He also serves as a director of
The Gap, Inc. and AirTouch Communications, Inc.
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* Member of the Executive Committee.
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DIRECTORS CONTINUING IN OFFICE UNTIL 1997
TONI REMBE* Director since 1995 Age 59
Partner at Pillsbury Madison & Sutro, a law firm. She also serves as a
director of American President Companies, Ltd., Pacific Telesis Group and
Potlatch Corporation.
FORREST N. SHUMWAY Director since 1973 Age 69
Retired Vice Chairman of the Board of Allied-Signal Inc., a multi-industry
company. He also serves as a director of Aluminum Company of America, American
President Companies, Ltd., The Clorox Company and First Interstate Bancorp.
PETER V. UEBERROTH Director since 1984 Age 58
Managing Director of The Contrarian Group, Inc., a business management
company, since 1989. Since 1995, he has been Co-Chairman of the Board and a
director of Doubletree Corp., a hotel company. He also serves as a director of
Ambassadors International, Inc. and The Coca-Cola Company.
DIRECTORS CONTINUING IN OFFICE UNTIL 1998
JAMES R. HARVEY* Director since 1975 Age 61
Former Chairman of the Board of the Corporation. He was Chairman of the Board
from 1983 through 1995 and Chief Executive Officer from 1981 to 1991. He
retired as an employee of the Corporation in 1992. He also serves as a
director of AirTouch Communications, Inc., The Charles Schwab Corporation and
McKesson Corporation.
GORDON E. MOORE* Director since 1981 Age 67
Chairman of the Board and a director of Intel Corporation, a semiconductor
manufacturing company. He also serves as a director of Varian Associates, Inc.
and Gilead Sciences, Inc.
CONDOLEEZZA RICE* Director since 1991 Age 41
Provost of Stanford University since 1993. She was Associate Professor of
Political Science at Stanford from 1987 to 1989 and from 1991 to 1993. She was
Special Assistant to the President of the United States on the National
Security Council from 1990 to 1991 and Director of Soviet and East European
Affairs on the National Security Council from 1989 to 1990. She also serves as
a director of Chevron Corporation.
DIRECTOR COMPENSATION AND BENEFITS
Directors who are not employees of the Corporation or its subsidiaries
receive an annual retainer of $24,000 and a fee of $1,000 for each Board or
committee meeting attended. Committee chairs also receive an annual retainer
of $2,500, with the exception of the chairs of the Management Development and
Compensation, the Corporate Audit and the Executive Committees, who each
receive annual retainers of $3,500. Directors who are employees of the
Corporation do not receive fees for their services as directors.
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* Member of the Executive Committee.
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Directors are eligible annually to defer receipt of $5,000 or more of their
retainers and meeting fees under the Corporation's deferred compensation plan.
Amounts deferred are credited with interest. The interest rate is adjusted
annually and equals an average of the rate paid by ten-year U.S. Treasury
Notes, plus 0% to 3%, depending on the length of the term of deferral. For
amounts deferred prior to 1996, the interest rate for deferral terms of at
least five years is indexed to the Moody's A Rated Corporate Bond Yield, with
a premium of 2% to 4%. The time and method of payment of deferred compensation
and other terms and conditions are set forth in deferred compensation
elections made prior to deferral by each participating director.
Each member of the Board of Directors who retires from the Board after
serving for at least five years as a non-employee director is eligible to
receive retirement benefits. The annual benefit amount will equal the
individual's annual retainer fee in effect at the time of his or her
retirement (exclusive of any meeting fees or fees for serving as a committee
chair). Payments will be made to the director or, in the event of the
director's death, his or her spouse, for a period equal to the period of time
that the individual served on the Board as a non-employee director.
Directors who are not employees of the Corporation receive stock options
pursuant to The 1985 Stock Option and Award Plan of Transamerica Corporation
(the "1985 Plan"). Under the 1985 Plan, each non-employee director
automatically is granted a nonqualified stock option for 1,500 shares each
year. All options are granted at fair market value on the effective date of
the grant and generally have a term not exceeding ten years and one month.
Options issued to non-employee directors are exercisable in full beginning six
months after grant.
Mr. Harvey, the retired chairman of the board and chief executive officer of
the Corporation, has been retained by the Corporation to provide consulting
and advisory services and to work on special assignments. Mr. Harvey agreed to
make available during 1995 approximately 15% of his business time for these
purposes and the Corporation paid him a total of $81,250 as compensation for
rendering such services. Mr. Harvey's present consulting agreement with the
Corporation expires in April 1997. Pursuant to this agreement, the Corporation
is obligated to pay Mr. Harvey an additional $75,000 for his consulting and
related services during 1996. In addition, he remains entitled to the use of
an automobile and the reimbursement of certain expenses. Mr. Harvey also
continues to serve on the Board of Directors. As a director, Mr. Harvey
receives the same retainers, fees and benefits as other non-employee
directors.
See Compensation Committee Interlocks and Insider Participation on page 5
for a description of certain agreements between certain subsidiaries of the
Corporation and a subsidiary of The Charles Schwab Corporation, of which Mr.
Harvey is a director.
COMMITTEES OF THE BOARD OF DIRECTORS AND MEETINGS HELD
Mr. Moore (Chairman), Ms. Rembe, Ms. Rice and Messrs. Ginn and Schwab are
members of the Corporate Audit Committee of the Board of Directors. The
committee recommends the engagement of independent auditors, reviews the plan
and results of the audit engagement with the independent auditors, approves
professional services provided by the independent auditors, reviews the
independence of the independent auditors, considers the fees of the
independent auditors, reviews the Corporation's annual financial statements,
reviews the scope and results of the Corporation's internal auditing
activities and the adequacy of internal accounting controls, and directs
special investigations. The Corporate Audit Committee held four meetings in
1995.
Messrs. Ueberroth (Chairman), Du Bain, Ginn, Schwab and Shumway are members
of the Management Development and Compensation Committee of the Board of
Directors. The Committee establishes corporate compensation objectives,
reviews comparative studies of compensation programs to enable the Corporation
to offer the competitive compensation programs necessary to attract and retain
superior management and reviews and approves cash compensation arrangements
and incentive plans for senior management. The
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Committee also reviews, approves and administers the Corporation's Value Added
Incentive Plan, stock option plans, deferred compensation plan, perquisite
programs for corporate officers and similar programs. The Committee also
authorizes the granting of options, restricted stock and other awards under
the Corporation's stock option plans. The Committee also nominates corporate
officers and reviews succession plans for senior corporate and subsidiary
officer positions. The Management Development and Compensation Committee held
four meetings in 1995.
Mr. Du Bain (Chairman), Ms. Rice and Messrs. Harvey, Herringer, Schwab and
Shumway are members of the Nominating Committee of the Board of Directors. The
Committee recommends to the Board of Directors the Board size and criteria for
qualification as a candidate for Board membership, reviews the qualifications
of candidates for Board membership and directs the search for qualified
candidates to fill Board vacancies that may occur from time to time. The
Committee also recommends to the Board the slate of director candidates to be
proposed for election by the stockholders at the annual meetings and
candidates to fill vacancies which occur between such annual meetings. The
Committee also recommends to the Board the establishment of, and charge of
responsibilities to, various committees of the Board. The Nominating Committee
held two meetings in 1995. Subject to the provisions of the Corporation's By-
Laws, the Nominating Committee will consider nominees for directors
recommended by stockholders. Any recommendations should be submitted in
writing to the Secretary of the Corporation, 600 Montgomery Street, San
Francisco, California 94111.
During 1995, the Board of Directors held eight meetings. All the directors
attended 75% or more of the meetings of the Board and committees of which they
were members.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
There are no "interlocks" (as defined by the Securities and Exchange
Commission) with respect to any member of the Management Development and
Compensation Committee of the Board of Directors of the Corporation (the
"Committee"), and the Committee consists of independent, non-employee
directors.
Mr. Schwab is a member of the Committee and is the Chairman of the Board,
Chief Executive Officer and a director of The Charles Schwab Corporation, a
discount brokerage firm. Transamerica Occidental Life Insurance Company, a
subsidiary of the Corporation, and certain of its subsidiaries and affiliated
companies (collectively "Occidental") have entered into certain agreements
with Charles Schwab & Co., Inc. ("Schwab & Co."), a subsidiary of The Charles
Schwab Corporation, pursuant to which Occidental issues variable annuity
contracts which are marketed, distributed and administered by Schwab & Co. The
compensation payable by Occidental to Schwab & Co. for such services includes
a percentage of the value of the assets invested in the annuities and certain
contract fees.
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STOCKHOLDINGS OF DIRECTORS AND EXECUTIVE OFFICERS
The following table indicates, as to each director and each executive
officer named in the Summary Compensation Table on page 13, and as to all
directors and executive officers as a group, the number of shares and
percentage of the Corporation's common stock beneficially owned as of March 5,
1996.
<TABLE>
<CAPTION>
SHARES OF PERCENTAGE OF
COMMON STOCK COMMON STOCK
NAME BENEFICIALLY OWNED BENEFICIALLY OWNED(1)
--------------------------- ---------------------- ---------------------
<S> <C> <C>
DIRECTORS
Myron Du Bain 11,267 (2)(3) *
Samuel L. Ginn 8,221 (2)(3) *
James R. Harvey 71,432 (2)(3) *
Frank C. Herringer 724,917 (3)(4)(5) 1.1%
Gordon E. Moore 10,041 (2) *
Toni Rembe 3,568 (2) *
Condoleezza Rice 6,000 (2) *
Charles R. Schwab 11,475 (2) *
Forrest N. Shumway 16,242 (2)(3) *
Peter V. Ueberroth 11,041 (2)(3) *
EXECUTIVE OFFICERS
Thomas J. Cusack 134,186 (4) *
Richard H. Finn 345,405 (3)(4) *
Edgar H. Grubb 162,239 (3)(4) *
Richard N. Latzer 177,395 (4) *
All directors and executive
officers
as a group (20 persons) 1,899,587 (2)(3)(4)(5) 2.8%
</TABLE>
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(1) Represents shares held as of March 5, 1996 directly and with sole voting
and investment power (or with voting and investment power shared with a
spouse) unless otherwise indicated. An asterisk indicates that the number
of shares owned by the director or executive officer represents less than
1% of the outstanding shares of common stock.
(2) Includes, as to each non-employee director (except Mr. Harvey and Ms.
Rembe) -5,000 shares, as to Mr. Harvey-3,000 shares, as to Ms. Rembe-1,500
shares, and as to all directors and executive officers as a group-39,500
shares, which may be acquired upon the exercise of director stock options,
all of which are currently exercisable. These shares are considered
outstanding for purposes of calculating each director's percentage
ownership.
(3) Includes shares held by family trusts as to which each of the following
directors and executive officers and their respective spouses have shared
voting and investment power: Mr. Du Bain-1,667 shares; Mr. Ginn-3,221
shares; Mr. Harvey-68,432 shares; Mr. Shumway-11,242 shares; Mr.
Ueberroth-6,041 shares; Mr. Finn-36,033 shares; and Mr. Grubb-6,500
shares; as to which Mr. Herringer has either sole, or he and his spouse
have shared, voting and investment power-33,636 shares; and all directors
and executive officers as a group-192,671 shares.
(4) Includes shares which may be acquired upon the exercise of stock options
exercisable on March 5, 1996, or within 60 days thereafter, as follows:
Mr. Cusack-129,300 shares; Mr. Finn-294,700 shares; Mr. Grubb-153,300
shares; Mr. Herringer-680,950 shares; Mr. Latzer-173,750 shares; and all
directors and executive officers as a group-1,636,550 shares. These shares
are considered outstanding for purposes of calculating each such current
executive officer's percentage ownership. The numbers in the table also
include restricted stock awards, which vest in two remaining equal annual
installments commencing April 27, 1996, and as to which the executive
officer has the right to vote and to receive dividends, as follows: Mr.
Cusack-2,000 shares; Mr. Grubb-2,000 shares; Mr. Herringer-2,500 shares;
Mr. Latzer-500 shares; and all directors and executive officers as a
group-7,000 shares. The numbers in the table also include shares held
under the Corporation's Employees Stock Savings Plan on December 31, 1995
and as to which the participant has sole voting and investment power, as
follows: Mr. Cusack-386 shares; Mr. Finn-14,672 shares; Mr. Grubb-439
shares; Mr. Herringer-3,587 shares; Mr. Latzer-645 shares; and all
directors and executive officers as a group-34,938 shares.
(5) Excludes 14,796 shares held by Mr. Herringer's spouse, as to which he has
no voting or investment power and as to which he disclaims beneficial
ownership.
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SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors and executive officers, and persons who own more than
10% of the Corporation's common stock, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission.
Based solely on the Corporation's review of the reporting forms received by
it, and written representations from certain persons that no Form 5 reports
were required to be filed by those persons, the Corporation believes that for
1995 all such filing requirements were satisfied.
(2) ELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP to audit the financial
statements of the Corporation for 1996, subject to the election of such firm
by the stockholders at the 1996 Annual Meeting of Stockholders. Ernst & Young
LLP has audited the financial statements of the Corporation annually since the
inception of the Corporation in 1928. If the stockholders do not elect Ernst &
Young LLP, the Board of Directors will consider the selection of other
auditors.
Representatives of Ernst & Young LLP will be present at the Annual Meeting
with the opportunity to make a statement and respond to appropriate questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR
PROPOSAL 2.
(3) STOCKHOLDER PROPOSAL ON REDEMPTION, OR SUBMISSION TO A STOCKHOLDER VOTE,
OF THE STOCK PURCHASE RIGHTS PLAN ADOPTED IN 1986.
The Corporation has been advised that a stockholder of the Corporation
proposes to introduce the following proposal and statement in support thereof
at the 1996 Annual Meeting of Stockholders. (The name and address of, and the
number of shares held by, the proponent can be obtained upon request from the
office of the Secretary of the Corporation).
"RESOLVED: That the Shareholders of Transamerica Corp. urge that the
board of directors redeem any shareholder rights plan unless the issue is
approved by the affirmative vote of a majority of the outstanding shares at
a meeting of the shareholders held as soon as possible."
STATEMENT OF STOCKHOLDER IN SUPPORT OF THE PROPOSAL
"In 1986, Transamerica Corp. adopted a shareholder rights plan commonly
known as a "poison pill.' Generally, we think such pills serve to insulate
management from shareholder interests.
"The drag of poison pill rights plans on the trading value of a company's
stock is well documented. The Board should consider redeeming the pill as part
of an effort to improve shareholder value. While the "pill' is set to expire
in 1996, immediate redemption will demonstrate the Board's dedication to
shareholder concerns.
"The "pill' is an inappropriate, antiquated and unnecessary takeover device.
Apologists for poison pills claim that they prevent a "midnight raid' on the
company. The statute in Delaware, where our company is incorporated, provides
ample protection for corporations generally.
"Poison pills have become increasingly unpopular in recent years. Some
companies have heeded shareholder concern and either redeemed their current
pills (Philip Morris), promised to replace pills only with a shareholder vote
(Consolidated Freightways), or at least engage in a dialogue with shareholders
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regarding pills (Bank of America). Since the beginning of 1990, Time Warner,
United Technologies, La Quinta Inns, and Lockheed have voluntarily redeemed
their poison pills. Since 1990, a majority of voting shareholders at more than
24 companies asked management to either repeal, redeem or allow a shareholder
vote on poison pills. In 1994 alone, a majority of voting shareholders at
Advanced Micro Devices, Community Psychiatric Centers, Intel, Ryder and
Wellman, joined this list.
"The "pill' is only one emblem of management insulation from shareholder
concerns. In the past Transamerica sparked shareholder criticism because of
golden parachutes adopted by management without a shareholder vote. By
redeeming the "pill,' Transamerica can demonstrate its determination to
improve accountability.
"Therefore we urge a vote FOR this proposal."
STATEMENT BY THE BOARD OF DIRECTORS AGAINST THE PROPOSAL
The Rights Plan expires by its terms this year on August 8th and the Board
currently does not intend to adopt a new rights plan. To redeem the rights or
to subject the plan to a special stockholder meeting given the Rights Plan's
imminent expiration would cause the Corporation to incur unnecessary expense.
The overriding objective of the Board ten years ago when it adopted the
Rights Plan was the preservation and maximization of the Corporation's value
for the stockholders. This continues to be the primary objective of the Board.
During the ten years since the adoption of the Rights Plan, the Corporation
has taken many successful actions to maximize value for its stockholders. For
example, the Corporation has redeployed capital to divest low return
businesses, made strategic acquisitions and returned underutilized equity
capital to its stockholders through dividends and share purchases.
Furthermore, last year the stockholders approved the 1995 Performance Stock
Option Plan designed to strongly motivate management to achieve superior
stockholder returns. The Plan includes both premium-priced options and
performance-vested options, which means that options granted under that plan
require that stockholders realize significant returns on their investment
before management can receive any significant gains on their options. In 1994,
the stockholders approved the Value Added Incentive Plan which linked
compensation of management with the long-term interest of stockholders. As
part of that Plan, the CEO's bonus incentive has no discretionary component
and is instead tied 100% to the calculation of stockholder value-added. The
Corporation has demonstrated its commitment to maximizing stockholder value
and aligning management's interest with that of its stockholders.
The Corporation's share price has significantly increased in recent years.
The Corporation's ability to provide excellent returns to its stockholders is,
of course, one of the most important factors in allowing the Board to
effectively negotiate with any potential acquirer.
As circumstances exist currently, the Board believes the Corporation is well
positioned to continue to achieve the objectives sought to be achieved by the
Rights Plan without having a rights plan in effect. If circumstances should
emerge where the Board believes the Corporation should evaluate additional
tools to enable it to further the interests of its stockholders, the Board
will consider the desirability of a rights plan at such time, along with such
other alternatives as it believes appropriate.
The Board believes the adoption of the proposal would not be in the best
interests of the Corporation's stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE AGAINST
PROPOSAL 3.
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EXECUTIVE COMPENSATION AND OTHER INFORMATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Program
The Corporation's compensation program is designed to enhance stockholder
value by linking a large part of the executives' compensation directly to
those aspects of performance that are highly correlated with share price. The
objective is to provide executives an opportunity to achieve total
compensation at the 75th percentile or above for exceptional performance. The
primary components of the compensation program are base salary, an annual cash
bonus driven by the Corporation's Value Added performance (see below) and a
long-term opportunity to participate in increased stockholder value through
grants of stock options.
Responsibilities of the Management Development and Compensation Committee
The Management Development and Compensation Committee of the Board of
Directors of the Corporation (the "Committee") was established in 1961 and
since that time has consisted solely of independent, non-employee directors.
The Committee reviews and approves incentive plans, executive benefit programs
and perquisites. Annually, the Committee reviews and approves base salaries,
bonuses and any other cash payments to executive officers and other key
employees. The Committee also grants stock options and restricted stock,
approves the terms of such awards and interprets incentive plans, as required.
As administrator of the Value Added Incentive Plan, the Committee takes
certain actions, including the establishment of target awards prior to the
beginning of each plan year, and certifies in writing that performance goals
are achieved prior to approving payment of awards under that plan.
As needed, the Committee engages an executive compensation consultant to
review competitive levels of total compensation, including base salary and
annual and long-term incentive programs. Additionally, the consultant provides
information on the value of individual option awards. The consultant conducts
comparative studies, reviews proposed changes related to the Corporation's
compensation program, and provides information on general compensation trends.
Included in the comparator group of companies are a combination of companies
in the S&P Financial Index (excluding banks and savings and loan associations)
and a sampling of companies with stockholders' equity of similar size to that
of the Corporation, for which data is readily available. The Committee meets
without management present to discuss the Chief Executive Officer's
performance, base salary and target incentive compensation.
Elements of the Compensation Program
The primary elements of the Corporation's compensation program for the Chief
Executive Officer ("CEO") and other executive officers of the Corporation are
described below.
Base Salary
Base salaries are reviewed annually by the Committee using competitive data
provided by the compensation consultant and considering industry and national
trends. Individual salaries are adjusted based on this information and the
executive's performance for the preceding year and current responsibilities.
On average, salaries of executive officers, including the salary of the CEO,
were between the median and 75th percentile of salaries of like positions in
comparator companies. The CEO did not receive a base salary increase in 1995.
Annual Incentive Plan
The Value Added Incentive Plan (the "Value Added Plan"), approved by
stockholders in 1994, covers the CEO and other named executive officers. The
Value Added Plan rewards management for both improving operating results and
efficiently employing the Corporation's capital. Awards under the Value
9
<PAGE>
Added Plan are based on the Corporation's actual Value Added, which is defined
as the Corporation's Adjusted Net Income minus an equity charge, expressed as
a percentage of the Corporation's Average Adjusted Equity, all as defined in
the Value Added Plan. Such awards were the only annual incentive awards the
Corporation's CEO and Chief Financial Officer ("CFO") received for 1995.
The Corporation's Value Added for 1995 generated approximately 104% of
target bonuses for plan participants, due to a combination of a 10% increase
in net income and more than a 20% increase in net income per share, reflecting
good operating results and careful management of capital utilized in the
business. Amounts awarded to other executive officers, including the other
three named executive officers, in the Summary Compensation Table on page 13,
were based substantially on Value Added as described above for the CEO and
CFO. Additionally, they were awarded amounts based on the performance of
business units reporting to them and/or the accomplishment of certain
strategic goals.
Stock Option Awards
The Committee believes that stock options are a superior incentive to
motivate key employees to act in the best interests of stockholders. While
many publicly held companies have multiple long-term incentive plans,
frequently including cash, stock options, and restricted stock, or
combinations thereof, stock options are the only continuing long-term
incentive that the Corporation's CEO and other named executive officers
receive.
In 1995, stockholders approved adoption of The 1995 Performance Stock Option
Plan (the "1995 Plan") and awards made pursuant to the 1995 Plan. The 1995
Plan is designed to strongly motivate management to achieve superior
stockholder returns. Under the 1995 Plan, stockholders must realize
significant returns on their investment before management can receive any
significant gains on their options.
Based on information supplied by the compensation consultant, the Committee
made awards in 1995 taking into consideration a number of factors, including
the competitive level of long-term incentive awards, the prospective level of
total compensation, and the individual's responsibilities and ability to
influence stockholder value, but not the amount or terms of outstanding
previous awards. In addition to the above criteria, the number of premium
priced options and performance vesting options that were awarded to the CEO
and other executive officers in 1995 were determined in part based on those
individuals not receiving any additional awards of such options within the
three-year period 1995 through 1997 (other than in the event of a promotion).
Based on the above considerations and as approved by the Corporation's
stockholders at the 1995 Annual Meeting of Stockholders, the CEO in 1995
received premium priced options and performance vesting options under the 1995
Plan. The options have exercise prices of $60, $82 and $100 respectively, and
were granted on January 26, 1995, when the closing price of the Corporation's
common stock was $50.75 per share. The $82 and $100 options will vest only if
during a specified period the closing price of the Corporation's common stock
equals or exceeds the exercise price. The $82 and $100 options were granted
with a significantly smaller number of tandem limited stock appreciation
rights ("TLSARs"). These rights have a per share exercise price equal to 100%
of fair market value on the date of grant and are exercisable only upon a
change of control. Stock options awarded to other executive officers,
including the other named executive officers, were determined in a similar
fashion and were granted either with similar premium and performance vesting
provisions (including TLSARs) or at not less than 100% of fair market value on
the date of grant.
The 1995 Plan, together with the Value Added Incentive Plan, strongly
focuses the Corporation's senior management on delivering significant
stockholder value.
10
<PAGE>
Policy Regarding Deductibility of Compensation
Section 162(m) of the Internal Revenue Code limits the federal income tax
deductibility of compensation paid to the Corporation's CEO and to each of the
other four most highly compensated executive officers. The Corporation
generally may deduct compensation paid to such an officer only to the extent
the compensation does not exceed $1 million during any fiscal year or is
"performance-based" as defined in Section 162(m). The Committee considers the
net cost to the Corporation in making compensation decisions. Accordingly, the
Value Added Incentive Plan, the 1985 Plan, and the 1995 Plan each have been
designed or amended so that payments under those plans will qualify as
performance-based compensation under Section 162(m). Thus, the Corporation
will continue to receive a federal income tax deduction for such compensation.
Compensation Committee Members
Peter V. Ueberroth, Chairman
Myron Du Bain
Samuel L. Ginn
Charles R. Schwab
Forrest N. Shumway
11
<PAGE>
STOCK PRICE PERFORMANCE
The following graph shows the cumulative total return (with dividends
reinvested) of the Corporation, the S&P 500, and the S&P Financial Index*
(adjusted to eliminate banks and savings and loan institutions) over the years
1991 through 1995, inclusive:
<TABLE>
[GRAPH APPEARS HERE]
<CAPTION>
S&P
Measurement Period TRANSAMERICA S&P FINANCIAL
(Fiscal Year Covered) CORPORATION 500 INDEX INDEX*
- ------------------- ------------ --------- ---------
<S> <C> <C> <C>
Measurement Pt-
12/31/1990 $100.00 $100.00 $100.00
FYE 12/31/1991 $129.08 $130.47 $144.48
FYE 12/31/1992 $162.63 $140.41 $170.39
FYE 12/31/1993 $199.33 $154.56 $192.59
FYE 12/31/1994 $181.75 $156.60 $191.03
FYE 12/31/1995 $274.76 $215.45 $284.23
</TABLE>
[_] S&P 500
+ S&P Financial (Diamond) Transamerica
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN AS OF DECEMBER 31ST
OF EACH YEAR
(ASSUMES $100 WAS INVESTED ON DECEMBER 31,
1990)
------------------------------------------------
COMPANY/INDEX 1991 1992 1993 1994 1995
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Transamerica Corporation 129.08 162.63 199.33 181.75 274.76
- -----------------------------------------------------------------------------
S&P 500 Index 130.47 140.41 154.56 156.60 215.45
- -----------------------------------------------------------------------------
S&P Financial Index* 144.48 170.39 192.59 191.03 284.23
</TABLE>
All data for the performance graph was provided by Standard & Poor's
Compustat Services.
- --------
* Adjusted to exclude banks and savings and loan institutions. The adjusted
index consists of the S&P Financial Miscellaneous Index, the S&P Life
Insurance Index, the S&P Multi-Line Insurance Index, the S&P Property &
Casualty Index and the S&P Personal Loan Index, weighted by market
capitalization.
12
<PAGE>
The following tables contain specific compensation information for the Chief
Executive Officer and the next four most highly compensated individuals
serving as executive officers of the Corporation at December 31, 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION COMPENSATION AWARDS
----------------- ---------------------
RESTRICTED SECURITIES
NAME AND PRINCIPAL STOCK UNDERLYING ALL OTHER
POSITION YEAR SALARY BONUS AWARDS(1) OPTIONS COMPENSATION(2)
------------------ ---- -------- -------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Frank C. Herringer, 1995 $975,000 $708,776 1,585,000 $103,657
Chairman, President and 1994 975,000 561,566 150,000 73,116
Chief Executive Officer 1993 930,000 850,000 $243,150 175,000 99,695
Richard H. Finn, 1995 $640,000 $375,000 700,000 $202,314
Executive Vice 1994 602,000 400,167 80,000 52,584
President, and 1993 562,339 400,000 100,000 53,842
President and Chief
Executive Officer of
Transamerica Finance
Group
Richard N. Latzer, 1995 $430,000 $300,000 155,000 $ 48,992
Senior Vice President 1994 410,000 215,825 45,000 31,060
and Chief Investment 1993 390,000 260,000 $ 48,630 50,000 39,032
Officer, and President
and Chief Executive
Officer of Transamerica
Investment Services
Edgar H. Grubb, 1995 $435,000 $225,874 385,000 $ 60,642
Executive Vice 1994 411,000 182,094 40,000 50,495
President and Chief 1993 385,404 295,000 $194,520 60,000 50,612
Financial Officer
Thomas J. Cusack, 1995 $389,298 $296,250 500,000 $ 47,475
Executive Vice 1994 301,500 167,000 35,000 22,240
President, and 1993 259,276 225,000 $194,520 50,000 26,330
President and Chief
Executive Officer of
Transamerica Occidental
Life Insurance Company
</TABLE>
- --------
(1) Shares represented by restricted stock awards vest in four equal annual
installments commencing one year from the date of grant provided that the
executive continues to be employed by the Corporation. Dividends on
restricted shares are paid currently. Restricted stock awards were made to
Mr. Herringer-5,000 shares; Mr. Latzer-1,000 shares; and Messrs. Grubb and
Cusack-4,000 shares, as part of a special bonus for the successful
completion of the initial public offering of the Corporation's former
property and casualty insurance operations. The number of restricted
shares remaining unvested as of December 31, 1995, which constitutes the
entire restricted stock holdings of the five named executive officers, and
the value of such holdings (valued at the closing price of the
Corporation's common stock for New York Stock Exchange Composite
transactions on such date) was as follows: Mr. Herringer-2,500 shares,
$182,200; Mr. Latzer-500 shares, $36,440; and Messrs. Grubb and Cusack-
2,000 shares, $145,760.
(2) For 1995, includes (i) employer contributions under the Stock Savings
Plan, a 401(k) plan: $1,125 for each of the named executive officers; (ii)
employer contributions under the Stock Savings Plan Plus, a plan designed
to supplement the 401(k) plan: Mr. Herringer-$68,950; Mr. Finn-$44,550;
Mr. Latzer-$27,943; Mr. Grubb-$26,936; and Mr. Cusack-$23,967; (iii)
employer contributions for additional group term life, accidental death
and dismemberment, and disability insurance: Mr. Herringer-$22,545; Mr.
Finn-$14,639; Mr. Latzer-$9,683; Mr. Grubb-$9,801; and Mr. Cusack-$8,769;
(iv) above market interest on deferred compensation: Mr. Herringer-
$11,037; Mr. Latzer-$10,241; Mr. Grubb-$22,780; and Mr. Cusack-$1,575; (v)
forgiveness of a portion of the principal amount of a loan in connection
with an employee's relocation and purchase of a new home (see Certain
Transactions on page 16): Mr. Finn-$142,000; and (vi) reimbursement in
connection with an employee's relocation: Mr. Cusack-$12,040.
13
<PAGE>
STOCK OPTION GRANTS IN 1995
<TABLE>
<CAPTION>
PERCENT OF POTENTIAL REALIZABLE
TOTAL VALUE AT ASSUMED
NUMBER OF OPTIONS ANNUAL RATES OF STOCK
SECURITIES GRANTED TO PRICE APPRECIATION
UNDERLYING EMPLOYEES EXERCISE FOR OPTION TERM (4)
OPTIONS IN FISCAL OR BASE EXPIRATION DATE ----------------------
NAME GRANTED (1) YEAR PRICE (2) (3) 5% 10%
---- ---------- ---------- -------- ----------------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Frank C. Herringer 425,000 6.83% $ 60.00 January 26, 2005 $9,635,000 $30,443,000
425,000 6.83 82.00 January 26, 2005 0 0
735,000 11.81 100.00 January 26, 2007 0 0
Richard H. Finn 200,000 3.21 60.00 January 26, 2005 $4,534,000 $14,326,000
500,000 8.04 82.00 January 26, 2005 0 0
Richard N. Latzer 35,000 0.56 54.50 February 27, 2005 $1,199,000 $ 3,040,000
120,000 1.93 100.00 January 26, 2007 0 0
Edgar H. Grubb 100,000 1.61 60.00 January 26, 2005 $2,267,000 $ 7,163,000
100,000 1.61 82.00 January 26, 2005 0 0
185,000 2.97 100.00 January 26, 2007 0 0
Thomas J. Cusack 100,000 1.61 60.00 January 26, 2005 $2,267,000 $ 7,163,000
100,000 1.61 82.00 January 26, 2005 0 0
185,000 2.97 100.00 January 26, 2007 0 0
50,000 0.80 82.00 January 26, 2005 0 3,763,000
65,000 1.04 100.00 January 26, 2007 0 5,868,000
</TABLE>
- --------
(1) Options granted with an exercise price of $54.50 become exercisable in
four annual installments commencing one year from the date of grant.
Options granted with an exercise price of $60.00 become exercisable in
three annual installments commencing three years from the date of grant.
Options granted with exercise prices of $82 and $100 will vest only if
during a period of ten trading days out of any thirty consecutive trading
days ending on or before January 26, 2000 (for $82 Options) or January 26,
2002 (for $100 Options) the market value of the Corporation's common stock
equals or exceeds the exercise price. The $82 and $100 Options were
granted with tandem limited stock appreciation rights (TLSARs) which are
exercisable only upon a change of control. Each TLSAR expires on the same
general terms as the related options and exercise of the TLSAR requires
proportionate cancellation of the related option and vice versa. The
number of shares subject to TLSARs and exercise prices are as follows: Mr.
Herringer-235,000 shares, $50.75; Mr. Finn-115,000 shares, $50.75; Mr.
Latzer-22,000 shares, $50.75; Mr. Grubb-57,000 shares, $50.75; and Mr.
Cusack-57,000 shares, $50.75 and 32,000 shares, $60.63.
(2) Subject to the discretion of the Management Development and Compensation
Committee, the exercise price and tax withholding obligations may be paid
in stock.
(3) The $82 Options and $100 Options will expire earlier if they are not
vested in accordance with their respective performance requirements. In
certain circumstances, all options may expire earlier than the indicated
dates (for example, on termination of employment).
(4) Options granted at $82 or $100 to Messrs. Herringer, Finn, Latzer and
Grubb, and 285,000 of those granted to Mr. Cusack, will expire unvested
under both the 5% and 10% appreciation scenarios based on the market price
of $50.75 on the date of grant. Additional options granted to Mr. Cusack
(50,000 at $82 and 65,000 at $100) will vest only at an assumed
appreciation rate of 10%, and the Corporation's stock price would be
$157.26 and $190.28, respectively, at the end of the option term for each
such grant based on the market price of $60.63 on the date of grant.
14
<PAGE>
The total number of options outstanding (vested and unvested, including the
$82 and $100 awards under the 1995 Performance Stock Option Plan) as of March
5, 1996 for the five named executive officers as a group and for all employees
as a group represents approximately 7.6% and 19.2%, respectively, of the
Corporation's outstanding common stock as of that date.
AGGREGATED OPTION EXERCISES IN 1995; OPTIONS OUTSTANDING AND VALUES AT
DECEMBER 31, 1995
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED IN
UNEXERCISED OPTIONS AT THE MONEY OPTIONS AT
NUMBER DECEMBER 31, 1995 DECEMBER 31, 1995(2)
OF SHARES ----------------------- -----------------------
ACQUIRED VALUE NOT NOT
NAME ON EXERCISE REALIZED (1) EXERCISABLE EXERCISABLE EXERCISABLE EXERCISABLE
---- ----------- ------------ ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Frank C. Herringer 16,243 $424,507 621,087 1,810,000 $21,246,000 $10,879,000
Richard H. Finn 13,572 346,222 237,200 822,500 7,671,000 5,515,000
Richard N. Latzer 0 0 132,500 222,500 4,230,000 2,273,000
Edgar H. Grubb 0 0 130,800 457,500 3,936,000 3,076,000
Thomas J. Cusack 0 0 95,550 563,750 2,836,000 2,870,000
</TABLE>
- --------
(1) The value realized is the difference between (a) the mean of the high and
low prices of the Corporation's common stock for New York Stock Exchange
Composite Transactions on the date of exercise and (b) the exercise price
of the option, multiplied by the number of shares exercised.
(2) The value of unexercised options is the closing price of the Corporation's
common stock for New York Stock Exchange Composite Transactions on
December 31, 1995, $72.88, less the exercise price of the option,
multiplied by the number of options outstanding.
PENSION PLAN AND SUPPLEMENTAL PENSION PLANS
The Corporation has had a retirement plan for eligible employees since 1935.
Substantially all of the Corporation's subsidiaries participate in the plan.
Since applicable federal laws and the pension plan limit certain participants'
retirement plan benefits to an amount less than the amount otherwise provided
by the formula and prohibit certain compensation from being counted for
pension purposes, the Corporation, in accordance with the terms of its
Supplemental Pension Plan and SSP+ Supplemental Pension Plan, will make
supplemental payments to make up those differences.
<TABLE>
<CAPTION>
YEARS OF SERVICE
-------------------------------------------------------------------
REMUNERATION 10 15 20 25 OR MORE
------------ -------- -------- -------- ----------
<S> <C> <C> <C> <C>
$ 200,000 $ 39,000 $ 59,000 $ 78,000 $ 98,000
400,000 79,000 119,000 158,000 198,000
600,000 119,000 179,000 238,000 298,000
800,000 159,000 239,000 318,000 398,000
1,000,000 199,000 299,000 398,000 498,000
1,200,000 239,000 359,000 478,000 598,000
1,400,000 279,000 419,000 558,000 698,000
1,800,000 359,000 539,000 718,000 898,000
2,200,000 439,000 659,000 878,000 1,098,000
</TABLE>
As of December 31, 1995, the named executive officers had the following
years of benefit service: Mr. Herringer-17 years; Mr. Finn-17 years; Mr.
Latzer-7 years; Mr. Grubb-6 years; and Mr. Cusack- 6 years.
The table above shows the total estimated annual retirement benefits payable
under all pension plans to employees, including executive officers, upon
normal retirement on January 1, 1996 after selected periods of benefit service
assuming such employees and their spouses elect a single life annuity rather
than a form of joint and survivor or other form of annuity. If another form of
annuity was selected, the benefits would generally be lower than those shown
in the table.
15
<PAGE>
The pension plans currently provide for a benefit for each participant,
including the named executive officers, (payable as a single life annuity) of
2% of his or her final average compensation (average compensation during the
highest 60 consecutive months of his or her final 120 months of employment)
less 0.4% of his or her age 65 monthly Social Security-covered compensation,
with the result multiplied by years of benefit service (up to a maximum of 25
years). Under the pension plans, an executive's pensionable remuneration or
covered compensation means his or her salary and target bonus under the bonus
plan(s) applicable to the executive. For each named executive officer, covered
compensation for 1995 was within 10% of the total Annual Compensation shown in
the Summary Compensation Table on page 13 except that Mr. Latzer's covered
compensation of $645,000 was 88% of the total shown in such table. Benefits
earned under the pension plans' prior benefit formulas are protected to the
extent they exceed benefits earned under the current formula. A participant is
fully vested in his or her retirement benefit after five years of service.
SEVERANCE AGREEMENTS
The Company has entered into severance agreements with each of the executive
officers named in the Summary Compensation Table on page 13. The agreements
provide that, if the executive is terminated other than for cause, retirement
or disability within three years after a change of control of the Corporation
or if the executive terminates his employment for good reason within such
three-year period or voluntarily during the 30-day period following the first
anniversary of the change of control, the executive is entitled to receive a
lump sum severance payment equal to three times the sum of his highest target
annual compensation during the three years immediately preceding the change in
control, together with certain other payments and benefits, including
continuation of employee welfare benefits. An additional payment is required
to compensate the executive for excise taxes imposed with respect to payments
or benefits received due to a change of control (and for any income taxes
imposed with respect to such additional payment).
CERTAIN TRANSACTIONS
In July 1993, Mr. Finn entered into an agreement with the Corporation in
connection with his relocation to San Francisco pursuant to which the
Corporation agreed to loan Mr. Finn $425,000 to assist him with the purchase
of a home in the San Francisco Bay Area. The loan, which was made on March 4,
1994, is secured by a deed of trust on Mr. Finn's residence. The loan is
interest-free and is being forgiven ratably over its three-year term provided
that Mr. Finn remains an employee of the Corporation at each successive
anniversary date of the loan. On each of March 4, 1995 and March 4, 1996, the
principal amount of $142,000 was forgiven and the current balance of the loan
is $141,000. Also, the loan will be forgiven in full if he dies or becomes
permanently disabled, if he terminates his employment for good reason (as
defined in the agreement), or if the Corporation terminates his employment
other than for cause (as defined in the agreement). In addition, if Mr. Finn
dies or becomes permanently disabled during the term of the loan, the
Corporation has agreed to reimburse him or his estate for taxes paid by him or
his estate as a result of the forgiveness of the loan. If, during the term of
the loan, Mr. Finn voluntarily terminates his employment with the Corporation
(other than for good reason) or the Corporation terminates his employment for
cause, the principal amount of the loan then outstanding plus interest at 12%
per annum from the date of such termination will become due.
In August 1995, Mr. Cusack entered into an agreement with the Corporation in
connection with his relocation to Los Angeles pursuant to which the
Corporation agreed to loan Mr. Cusack $425,000 to assist him with the purchase
of a home in the Southern California area. The loan, which was made on August
15, 1995, is secured by a deed of trust on Mr. Cusack's residence. The full
$425,000 in principal remains outstanding. The loan is interest-free and will
be forgiven ratably over its five-year term provided that Mr. Cusack remains
an employee of the Corporation at each successive anniversary date of the
loan. Further, the loan will be forgiven in full if he dies or becomes
permanently disabled, if he terminates his employment
16
<PAGE>
for good reason (as defined in the agreement), if the Corporation terminates
his employment other than for cause (as defined in the agreement) or if, at
the Corporation's request, he sells his home in the Southern California area
and relocates in connection with his continued employment by the Corporation.
If Mr. Cusack dies or becomes permanently disabled during the term of the
loan, the Corporation has agreed to reimburse him or his estate for taxes paid
by him or his estate as a result of the forgiveness of the loan. If, during
the term of the loan, Mr. Cusack voluntarily terminates his employment with
the Corporation (other than for good reason) or the Corporation terminates his
employment for cause, the principal amount of the loan then outstanding plus
interest at 12% per annum from the date of such termination will become due.
In 1995, the Corporation and its subsidiaries obtained legal services from
the law firm of Pillsbury Madison & Sutro, of which Ms. Rembe is a member, on
terms which the Corporation believes were as favorable as would have been
obtained from unaffiliated third parties. It is anticipated that such law firm
will perform additional legal services for the Corporation and its
subsidiaries in 1996.
PRINCIPAL STOCKHOLDERS
Oppenheimer Group, Inc., Oppenheimer Tower, World Financial Center, New
York, New York 10281, has filed a statement on Schedule 13G with the
Securities and Exchange Commission in which it reported owning, as of December
31, 1995, 9,835,448 shares, or 14.39%, of the Corporation's outstanding common
stock. Oppenheimer Group, Inc. reported that it had shared voting power and
shared dispositive power with respect to all 9,835,448 shares.
The Corporation does not know of any other person who is the beneficial
owner of more than 5% of the Corporation's outstanding common stock.
OTHER MATTERS
Management does not know of any matters to be brought before the Annual
Meeting except as specified in the Notice of the Annual Meeting. However, as
to any other matters which may properly come before the Annual Meeting, it is
intended that proxies, in the form enclosed, will be voted in accordance with
the judgment of the designated proxy holders.
STOCKHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Any stockholder proposal intended to be presented at the 1997 Annual Meeting
of Stockholders of the Corporation must be received by the Corporation no
later than November 18, 1996, for inclusion in the Corporation's Proxy
Statement and form of proxy relating to such meeting.
San Francisco, California
March 18, 1996
17
<PAGE>
P R O X Y
THIS PROXY IS BEING SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF THE
CORPORATION
The undersigned hereby appoints Shirley H. TRANSAMERICA
Buccieri, Edgar H. Grubb or Frank C. Herringer, CORPORATION
each with power of substitution, as proxies of
the undersigned, to attend the Annual Meeting of
Stockholders of Transamerica Corporation, to be
held at the Giannini Auditorium, Concourse Level,
Bank of America Center, 555 California Street,
San Francisco, California on April 25, 1996 at
11:00 A.M., and any adjournment thereof, and to
vote the number of shares the undersigned would ANNUAL
be entitled to vote if personally present in the MEETING OF
manner indicated on this form and in their STOCKHOLDERS
discretion on any other matter which may
properly come before the Meeting. APRIL 25, 1996
[TRANSAMERICA LOGO]
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, WILL BE
VOTED FOR PROPOSALS 1 AND 2 AND AGAINST PROPOSAL 3. YOUR SHARES CANNOT BE VOTED
UNLESS YOU SIGN AND RETURN THIS CARD OR ATTEND THE MEETING AND VOTE IN PERSON.
SEE REVERSE
SIDE
<PAGE>
[x] Please mark your votes as in this example. 4896
----
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NOT OTHERWISE DIRECTED, WILL BE
VOTED FOR PROPOSALS 1 AND 2 AND AGAINST PROPOSAL 3.
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2 AND AGAINST
PROPOSAL 3.
- --------------------------------------------------------------------------------
1. Election of Directors
FOR [_] WITHHELD [_] Nominees:
S.L. Ginn
F.C. Herringer
C.R. Schwab
For, except vote withheld from the following Nominee(s):
- --------------------------------------------------------
2. Election of Ernst & Young LLP, Certified Public Accountants, as independent
auditors.
FOR [_] AGAINST [_] ABSTAIN [_]
3. Stockholder proposal on redemption, or submission to a stockholder vote, of
the Stock Purchase Rights Plan adopted in 1986.
FOR [_] AGAINST [_] ABSTAIN [_]
Please sign exactly as name(s) appear
hereon. Joint owners should each
sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give full title as
such.
-------------------------------------
-------------------------------------
SIGNATURE(S) DATE
