0000912057-95-006732.txt : 19950821
0000912057-95-006732.hdr.sgml : 19950821
ACCESSION NUMBER: 0000912057-95-006732
CONFORMED SUBMISSION TYPE: PRE 14A
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 19951019
FILED AS OF DATE: 19950818
SROS: CSX
SROS: NYSE
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: IMC GLOBAL INC
CENTRAL INDEX KEY: 0000820626
STANDARD INDUSTRIAL CLASSIFICATION: AGRICULTURE CHEMICALS [2870]
IRS NUMBER: 363492467
STATE OF INCORPORATION: DE
FISCAL YEAR END: 0630
FILING VALUES:
FORM TYPE: PRE 14A
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-09759
FILM NUMBER: 95565360
BUSINESS ADDRESS:
STREET 1: 2100 SANDERS RD
CITY: NORTHBROOK
STATE: IL
ZIP: 60062
BUSINESS PHONE: 7082729200
MAIL ADDRESS:
STREET 1: ONE NELSON C WHITE PKWY
CITY: MUNDELEIN
STATE: IL
ZIP: 60060
FORMER COMPANY:
FORMER CONFORMED NAME: IMC FERTILIZER GROUP INC
DATE OF NAME CHANGE: 19920703
PRE 14A
1
PRE 14A
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:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
IMC GLOBAL INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
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NOTICE OF
1995 ANNUAL MEETING
OF STOCKHOLDERS
AND
PROXY STATEMENT
[LOGO]
PRELIMINARY COPY
September 8, 1995
[LOGO]
Dear Stockholder:
You are cordially invited to attend the Eighth Annual Meeting of the
Stockholders of IMC Global Inc. The meeting will be held at the Omni Orrington
Hotel, 1710 Orrington Avenue, Evanston, Illinois 60201-3855 on October 19, 1995,
at 11:00 a.m. local time. The back page of this Proxy Statement contains
directions to the Omni Orrington Hotel and parking information. A Notice of this
Annual Meeting and a Proxy Statement covering the formal business of the meeting
and related information which will be of interest to you are enclosed. At the
meeting we shall report on the Company's operations during the fiscal year ended
June 30, 1995.
We encourage you to attend the meeting. If you plan to do so, kindly check
the appropriate box on the accompanying proxy card. Whether or not you expect to
attend, please promptly sign and return the proxy card in the accompanying
postage-paid envelope. This will assure that your shares are represented at the
meeting and will help us avoid the expense of a follow-up mailing. Even though
you execute this proxy, you may revoke it at any time before it is voted. If you
attend the meeting and wish to vote in person, you will be able to do so even if
you have previously returned your proxy card.
Your cooperation and prompt attention to this matter will be appreciated.
Sincerely,
CHAIRMAN AND
CHIEF EXECUTIVE OFFICER
2100 Sanders Road
Northbrook, Illinois 60062-6146
Telephone 708-272-9200
HEADQUARTERS OFFICE:
2100 SANDERS ROAD,
NORTHBROOK, ILLINOIS
60062-6146
[LOGO]
--------------------
NOTICE OF EIGHTH ANNUAL MEETING OF STOCKHOLDERS
----------------------------------------------------------------------------
To our Stockholders:
The Eighth Annual Meeting of the Stockholders of IMC Global Inc., a Delaware
corporation, will be held on Thursday, October 19, 1995, at the Omni Orrington
Hotel, 1710 Orrington Avenue, Evanston, Illinois 60201-3855 at 11:00 a.m. local
time, to consider and act upon the following matters, each of which is explained
more fully in the following Proxy Statement.
1. To elect two directors for terms expiring in 1996, as recommended by the
Board of Directors; and to re-elect three directors for terms expiring
in 1998, as recommended by the Board of Directors.
2. To authorize and to approve an amendment to the Company's 1988 Stock
Option and Award Plan to increase by 1,000,000 the number of shares
available to be awarded and also amend certain provisions under the
Plan, as recommended by the Board of Directors.
3. To consider and vote upon a proposal to amend the Company's Restated
Certificate of Incorporation to increase the authorized number of shares
of Common Stock; and
4. To ratify the appointment of independent auditors to examine and report
on the financial statements of the Company for the fiscal year ending
June 30, 1996, as recommended by the Board of Directors.
5. To transact any other business that may properly come before the meeting
or any adjournment thereof.
A proxy card for your use in voting on these matters is also enclosed.
In accordance with the By-Laws and resolution of the Board of Directors,
only common stockholders of record at the close of business on August 31, 1995
are entitled to notice of and to vote at the Annual Meeting.
Dated: September 8, 1995
By Order of the Board of Directors
MARSCHALL I. SMITH
SENIOR VICE PRESIDENT, SECRETARY
AND GENERAL COUNSEL
PROXY STATEMENT
IMC GLOBAL INC.
2100 SANDERS ROAD, NORTHBROOK, ILLINOIS 60062-6146
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of IMC Global Inc. (hereinafter sometimes
called the "Company," which includes subsidiaries where the context requires)
for the Eighth Annual Meeting of Stockholders to be held on October 19, 1995.
Notice of this meeting to all stockholders of record entitled to vote as of
August 31, 1995, accompanies this statement. As of the close of business on
August 31, 1995, the number of outstanding shares of Common Stock, par value
$1.00, of the Company ("Common Stock") which may be voted at the meeting was
shares. Only common stockholders of record at the close of business on
August 31, 1995, shall be entitled to vote at the Annual Meeting. Each issued
and outstanding share of Common Stock is entitled to one vote. This Proxy
Statement and the accompanying proxy are first being mailed to stockholders on
or about September 8, 1995.
Shares represented by proxies will be voted in accordance with directions
given on the proxy card by a stockholder. Any properly executed and returned
proxy not specifying to the contrary will be voted for the election of the
Board's nominees for directors, in favor of ratifying the appointment of
independent auditors, authorizing amendment to the Company's Restated
Certificate of Incorporation to increase the number of authorized shares of
Common Stock, authorizing and approving an amendment to the 1988 Stock Option
and Award Plan and in the discretion of the holder of proxies as to any other
matter that is properly presented at the meeting. A stockholder giving a proxy
has the right to revoke it at any time before it has been voted at the meeting.
A proxy submitted by a stockholder may indicate that all or a portion of the
shares represented by such proxy are not being voted by such stockholder with
respect to a particular matter. This could occur, for example, when a broker is
not permitted to vote stock held in street name on certain matters in the
absence of instructions from the beneficial owner of the stock. The shares
subject to any such proxy which are not being voted with respect to a particular
matter (the "non-voted shares") will be considered shares not present and
entitled to vote on such matter, although such shares may be considered present
and entitled to vote for other purposes and will count for purposes of
determining the presence of a quorum.
The affirmative vote of a plurality of the shares of Common Stock present in
person or by proxy at the Annual Meeting and entitled to vote in the election of
directors is required to elect directors. Accordingly, if a quorum is present at
the meeting, the two persons standing for election for the class of directors
whose term expires at the 1996 Annual Meeting who receive the greatest number of
votes will be elected to serve as directors and the three persons standing for
election for the class of directors whose terms expires at the 1998 Annual
Meeting who receive the greatest number of votes will be elected to serve as
directors. Therefore, withholding authority to vote for a director(s) and
non-voted shares with respect to the election of directors will not affect the
outcome of the election of directors. If a quorum is present at the meeting,
approval of each matter other than the election of directors and other than the
amendment to the Company's Restated Certificate of Incorporation requires the
affirmative vote of a majority of the shares of Common Stock present in person
or by proxy at the meeting and entitled to vote on such matter. An abstention
with respect to such matter has the legal effect of a vote against such matter.
Non-voted shares with respect to such matter will not affect the determination
of whether such matter is approved. Adoption of the amendment to the Company's
Restated Certificate of Incorporation requires the affirmative vote of the
holders of a majority of the outstanding shares of Common Stock. Accordingly,
any shares not voted (whether by abstention, broker non-vote or otherwise) will
have the same effect as a vote against the proposal.
The Annual Report of the Company for the fiscal year ended June 30, 1995, is
being mailed to stockholders with this Proxy Statement and the proxy card, but
such report is not incorporated in this Proxy Statement and is not a part of the
proxy soliciting material.
1
ELECTION OF DIRECTORS
As of the record date, the Board of Directors of the Company consists of
nine members. Two employees are members of the Board. Wendell F. Bueche is
Chairman of the Board and Chief Executive Officer of the Company and James D.
Speir is President and Chief Operating Officer. The Board is divided into three
classes with staggered terms of three years each, so that the term of one class
expires at each Annual Meeting of stockholders.
At the Annual Meeting, five nominees will stand for re-election as directors
of the Company. Frank W. Considine and Richard A. Lenon whose current terms as
directors expire at the Annual Meeting, have each expressed a willingness to
serve as a director of the Company for just one additional year. Accordingly,
Messrs. Considine and Lenon are standing for re-election to the class of
directors whose term expires at the Annual Meeting of stockholders in 1996. In
order to achieve balance among the classes of directors without increasing the
overall size of any class of directors, Wendell F. Bueche and James M. Davidson,
each of whom is currently serving in the class of directors whose term expires
at the Annual Meeting of stockholders in 1996, have agreed to stand for
re-election at the Annual Meeting to a new three-year term as part of the class
of directors whose term expires at the Annual Meeting of stockholders in 1998.
David B. Mathis, whose current term as director expires at the Annual Meeting,
also will stand for re-election at the Annual Meeting to the class of directors
whose term expires at the Annual Meeting of stockholders in 1998.
It is intended that the shares represented by the proxies named on the
enclosed proxy card will be voted, unless authorization to do so is withheld, in
favor of the election of Messrs. Considine and Lenon to serve until the Annual
Meeting of stockholders in 1996 and Messrs. Bueche, Mathis and Dr. Davidson to
serve until the Annual Meeting of stockholders in 1998, or, in each case, until
their successors have been duly elected and qualified. In the event that the
five nominees are re-elected, Mr. Bueche and Dr. Davidson would no longer serve
in the class of directors whose term expires at the Annual Meeting of
stockholders in 1996, but rather would serve only in the class of directors
whose term expires at the Annual Meeting of stockholders in 1998.
Directors shall be elected by a plurality of the votes of the shares of
Common Stock present in person or by proxy at the Annual Meeting and entitled to
vote in the election.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE FOLLOWING
FIVE NOMINEES (ITEM NO. 1 ON THE PROXY CARD).
The names of the directors whose terms of office shall continue after the
1995 Annual Meeting and the nominees, their principal occupations during the
past five years, certain other directorships held, and certain other information
are set forth below.
NOMINEES FOR ELECTION AS DIRECTORS
FOR TERMS EXPIRING IN 1996
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FRANK W. CONSIDINE, 74, Honorary Chairman and Chairman of the Executive
Committee, and former President and Chief Executive Officer, American
[PHOTO] National Can Company. Mr. Considine remained Chairman of the Board of
American National Can Company from 1988 to 1990 and since that time has
served as a member of various Boards of Directors. He is a director of
Helene Curtis Industries, Incorporated; Scotsman Industries, Inc. and
Pechiney International, S.A. IMC Global Inc. director since February,
1988. Chairman, Audit Committee and member, Executive Committee, and
Committee on Directors and Board Affairs.
2
RICHARD A. LENON, 75, Retired Chairman, International Minerals &
Chemical Corporation, a predecessor company to IMC Global Inc. Mr.
[PHOTO] Lenon was that corporation's Chief Executive Officer from 1971 until
1983 and Chairman from 1977 until August, 1986. Board member since
February, 1988. Chairman, Executive and Compensation Committees.
NOMINEES FOR ELECTION AS DIRECTORS
FOR TERMS EXPIRING IN 1998
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WENDELL F. BUECHE, 64, Chairman of the Board and Chief Executive
Officer of the Company. He has served in this capacity since August,
[PHOTO] 1994. From February 1993 until August of 1994 he was President and
Chief Executive Officer. Board member since July, 1991. Mr. Bueche was
Chairman of the Board, Chief Executive Officer and President of
Allis-Chalmers Corporation, a diversified manufacturer of industrial
equipment, from 1986 through 1988. He was retired from full time
employment from 1989 until February of 1993. He is also a director of
Marshall & Ilsley Corporation; M&I Marshall & Ilsley Bank; WICOR, Inc.;
Wisconsin Gas Company; and Executive Association, American Industrial
Partners, L.P. Member, Executive Committee; Committee on Directors and
Board Affairs (non-voting member).
[PHOTO] DR. JAMES M. DAVIDSON, 61, Vice President for Agriculture and Natural
Resources, University of Florida. Dr. Davidson joined the University of
Florida in 1974, became Professor and Assistant Dean for Research in
1979, Professor and Dean for Research, Institute of Food and
Agricultural Sciences, and Director, Florida Agricultural Experiment
Station, Gainesville, Florida in 1986, and assumed his present position
in 1992. Board member since July, 1991. Member, Audit Committee.
[PHOTO] DAVID B. MATHIS, 57, Chairman and Chief Executive Officer of Kemper
Corporation since February, 1992 and effective June 1, 1995, Chairman
of the Board and Director of Kemper National Insurance Companies. He
has been employed at Kemper since 1960 in management positions of
successively increasing importance. Mr. Mathis serves on the board of
trustees at Lake Forest College and is an advisory board member of the
J.L. Kellogg Graduate School of Management of Northwestern University.
He also serves on the board of directors of Evanston Hospital
Corporation and the board of trustees of the Chicago Symphony
Orchestra. Board member since February, 1995. Member, Committee on
Directors and Board Affairs.
3
DIRECTORS CONTINUING IN OFFICE
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[PHOTO] BILLIE B. TURNER, 64, Chairman Emeritus of the Board. Retired President
and Chief Executive Officer, a capacity in which he had served from the
Company's incorporation in 1987 until his retirement in February of
1993. He is a director of Cyprus-Amax Minerals Company. Board member
since 1987. Member, Executive and Audit Committees. Term expires in
1996.
[PHOTO] RAYMOND F. BENTELE, 58, Retired President and Chief Executive Officer,
Mallinckrodt Group Inc. which manufactures medical equipment, specialty
chemicals and veterinary products. Board member since June, 1994. He
was Executive Vice President of Mallinckrodt Group Inc. (formerly known
as IMCERA Group Inc.) from 1989 until retirement. He is also a director
of the Kellwood Company, Mallinckrodt Group Inc., Legett & Platt Inc.
and was previously a director of the Corporation from 1990 to 1991.
Chairman, Committee on Directors and Board Affairs and Member,
Compensation Committee. Terms expires in 1997.
[PHOTO] THOMAS H. ROBERTS, JR., 71, Since 1988, Director and Retired Chairman
of DEKALB Energy Company (formerly known as DEKALB Corporation). DEKALB
Energy Company is involved in the exploration for and production of
crude oil and natural gas. Also, he is a director of Pride Petroleum
Services and is a member of that Board's Compensation Committee as
well. IMC Global Inc. Board member since February, 1988. Member,
Compensation Committee. Term expires in 1997.
[PHOTO] JAMES D. SPEIR, 55, President and Chief Operating Officer. Board member
since August, 1994. Mr. Speir has worked for the Company his entire
career in positions of increasing responsibility, the most recent of
which was Executive Vice President, Operations. He is a director of
Condell Medical Center in Libertyville, Illinois. Term expires in 1997.
The full Board had six regular and one special meeting during the fiscal
year ended June 30, 1995. All directors attended at least 80% of the aggregate
of the total number of meetings of the Board and committees of the Board on
which he served except for Mr. Mathis who was appointed on February of 1995 and
Mr. Considine who attended 71.4% of such meetings due to conflicts in his
schedule with other board commitments.
4
COMMITTEES OF THE BOARD OF DIRECTORS
--------------------------------------------------------------------------------
The Board has established an Executive Committee, an Audit Committee, a
Compensation Committee and a Committee on Directors and Board Affairs to assist
it in the discharge of its responsibilities.
The Executive Committee, consisting of three non-employee directors and the
Chairman of the Board may by the terms of the By-Laws exercise all of the powers
of the full Board between meetings. This Committee met twice during the fiscal
year ended June 30, 1995.
The Committee on Directors and Board Affairs was created on June 14, 1995 in
accordance with the By-Laws of the Company. The Committee is comprised of three
non-employee directors and the Chairman of the Board who participates as a
non-voting member. The responsibilities of the Committee are, among others, to
identify, select and recommend to the Board the slate of nominees to be elected
by the stockholders, any director to be elected to fill a vacancy, and to
determine the appropriate qualifications for directorship. This Committee is
also charged with Board assessment and management succession, as well as the
development of compensation and benefits programs for the Board of Directors.
This Committee has met once within the fiscal year ended June 30, 1995.
The Audit Committee consists of three non-employee directors. It evaluates
the performance of the Company's independent auditors and their fees, and also
reviews the scope of the audit examination to be performed each year and the
results of the audit with the independent auditors and management. This
Committee also reviews the Company's policies and procedures on all matters of
social concern, such as environmental protection, equal employment opportunity,
occupational health and safety, product safety and eleemosynary activities. It
further reviews the scope of research and development activities by the Company
and trends in the political environment as they affect the Company. This
Committee met three times during the fiscal year ended June 30, 1995.
The Compensation Committee consists of three non-employee directors. The
responsibilities of the Compensation Committee include administering the stock
option and incentive compensation plans of the Company and its wholly-owned
subsidiary, IMC Global Operations Inc. (hereinafter sometimes called "IMC"),
monitoring the pension and other IMC benefit plans, and reviewing and approving,
or recommending to the Board for approval, the amount and nature of compensation
to be paid to corporate officers and other key employees. This Committee met
three times during the fiscal year ended June 30, 1995.
COMPENSATION OF DIRECTORS
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Employee directors of the Company (currently Messrs. Bueche and Speir)
receive no fees or remuneration, as such, for service on the Board or any
committee of the Board. Non-employee directors receive annual retainers of
$21,000, attendance fees of $1,000 for each meeting they attend of the Board and
a Board committee to which they were assigned, and additional annual retainers
of $2,000 for service as chairperson of a Board committee.
The Company and Mr. Turner have entered into a consulting arrangement under
which Mr. Turner receives an annual retainer of $250,020 for his services for
the period March 1, 1993 through February 29, 1996.
Pursuant to a Directors Retirement Service Plan, a non-employee director,
who has served at least six years as a director, has agreed to remain available
to provide consultation services to Company management and does not work for a
competitor, will, upon attainment of age 70 and after retirement from the Board,
receive an annual pension for a period of ten years (subject to earlier
termination upon death) equal to 60% to 100% of the annual retainer in effect at
retirement, depending upon the length of the director's service (60% if six
years, 70% if seven, 80% if eight, 90% if nine, and 100% if ten years or more).
Under the 1994 Stock Option Plan for Non-Employee Directors, each eligible
director annually receives Options to purchase shares of Common Stock of the
Company. Options are granted at 100% of the fair market value of the stock at
the time of grant. Options granted are immediately exercisable and may be
exercised at any time while the director remains in office and for twenty-four
months thereafter. However, options may not be sold within the six-month period
following the date of grant without the consent of the Compensation Committee
nor may options be exercised more than ten years after the date of grant.
In accordance with a policy established by the Board, the Chairman, the
President and any director who is not an officer of the Company may not stand
for reelection after he or she has attained the age of 70. For directors (other
than
5
the Chairman and the President) who are also officers, the relevant retirement
age is 65. The foregoing policy with respect to the retirement of directors who
are not officers of the Company does not apply to any person who was a director
on April 20, 1989.
BENEFICIAL OWNERSHIP OF THE COMPANY'S COMMON STOCK
--------------------------------------------------------------------------------
OWNERSHIP BY DIRECTORS AND EXECUTIVE OFFICERS
The following table shows the number of shares of the Company's Common Stock
that are owned beneficially, as of August 31, 1995, by each nominee for
director, each director continuing in office, each executive officer named in
the Summary Compensation Table, and all directors and executive officers as a
group, with sole voting and investment power unless otherwise indicated.
NUMBER OF SHARES
OWNED PERCENT OF
BENEFICIALLY OUTSTANDING(2)
NAME AS OF 8/31/95(1) COMMON STOCK
----------------------------------------------------------------------
Wendell F. Bueche 59,440(3)(4)
Raymond F. Bentele 2,500
Frank W. Considine 3,200
James M. Davidson 2,000
Richard A. Lenon 6,000
David B. Mathis 1,000
Thomas A. Roberts, Jr. 3,000
Billie B. Turner 63,173
James D. Speir 75,604(3)(4)
Robert C. Brauneker 66,208(3)(4)(5)
C. Steven Hoffman 29,380(3)(4)
Marschall I. Smith 17,610(3)(4)
Directors and executive
officers as a group 369,826 .%
----------------------------------------------------------------------
(1) Beneficial ownership of the Company's securities is based on information
furnished or confirmed by each officer and director.
(2) No individual director or officer is a beneficial owner of more than
percent of the class outstanding.
(3) Includes shares purchasable within 60 days of August 31, 1995 through the
exercise of options granted under the Company's stock option plan, as
follows: Mr. Bueche, 30,500 shares; Mr. Speir, 34,266 shares; Mr.
Brauneker, 33,100 shares; Mr. Hoffman, 18,800 shares; Mr. Smith, 9,600
shares; directors and executive officers as a group, 139,675 shares.
(4) Includes restricted shares held in escrow subject to service and
performance criteria under the Company's Long-Term Performance Incentive
Plan, as follows: Mr. Bueche, 14,554 shares; Mr. Speir, 8,786 shares; Mr.
Brauneker, 5,348 shares; Mr. Hoffman, 4,650 shares; Mr. Smith, 4,557
shares; directors and executive officers as a group, 47,870 shares.
(5) The number of shares shown in the table include 1,428 shares owned by
family members of Mr. Brauneker over which they may share voting and
investment power by reason of their relationship.
6
OWNERSHIP BY OTHERS
The Company believes that, as of August 31, 1995, only the following named
institutions, based on their filings with the Company and the SEC, are the
beneficial owners of more than five percent of the Company's Common Stock
entitled to vote at this meeting. Each beneficial owner has sole voting
authority and investment discretion with respect to the Common Stock reported.
SHARES
BENEFICIALLY PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED OF CLASS
------------------------------------------------------------------------
Prudential Insurance Company of America...... 2,156,200 6.7%
Prudential Plaza
Newark, NJ 07102
NWQ Investment Management Company............ 1,884,618 5.8%
655 South Hope Street
Los Angeles, CA 90017
Each director and each officer of the Company who is subject to Section 16
of the Securities Exchange Act of 1934 (the "Act") is required by Section 16(a)
of the Act to report to the Securities and Exchange Commission, by a specified
date, his beneficial ownership of or transactions in the Company's securities.
Reports received by the Company indicate that all such officers and directors
filed all requisite reports with the Securities and Exchange Commission on a
timely basis during 1994.
AGREEMENTS WITH OFFICERS
----------------------------------------------------------------------------
Agreements with the executive officers shown in the Summary Compensation
Table, to become effective in the event of a change in control of the Company,
are intended to assure the Company and its subsidiaries of the continued
services of these executives. In general, each of the agreements provides that,
in the event there is a change in control of the Company (as defined in the
agreement), the executive shall remain employed by the Company in his then
current position at the then current base and incentive compensation and benefit
levels for a period of three years, subject to earlier expiration because of
voluntary resignation, mandatory retirement, disability, or termination for
cause, as defined in the agreements. If the Company breaches the agreement, the
Company is obligated to provide the executive certain severance benefits,
including 3 years' base salary plus three times the average of the prior 3
years' bonuses. In addition, the Company would become obligated to continue the
executive's participation in various compensation and benefit plans in which the
executive was participating when the agreement became effective.
These agreements were amended in August, 1995 to update the definition of
change in control and to increase the severance and bonus payment from two years
to three years.
Certain provisions of the federal tax law impose a 20% surcharge upon an
executive of a corporation and deny Federal income tax deductibility to the
corporation as to a significant portion of the severance payments made to an
executive because of a change in control, if such payments as a whole exceed
three times his or her average annual base and incentive compensation for the
most recent five years. The amounts estimated to be payable under the aforesaid
agreements, if those agreements become effective, could be large enough to
subject the executives to the surcharge or to deprive the Company of any
deduction. The Company has agreed with each of the executives that, if a
surcharge were assessed upon payment of the aforementioned severance benefits,
it will provide "grossed up" reimbursement to the executive, including any tax
due on such additional amounts paid to him.
If a change in control did occur and the contingent employment agreements
were breached by the Company within three years thereafter, the amount of cash
that would be payable in respect of these amended contracts is estimated (as of
July 1, 1995 and excluding any gross-up) to be: Mr. Bueche, $2,350,120; Mr.
Speir, $1,345,060; Mr. Brauneker, $1,106,120; Mr. Hoffman, $949,000; and Mr.
Smith, $848,060.
The Company and Mr. Bueche have agreed to an amendment to his employment
agreement under which Mr. Bueche is to serve as Chief Executive Officer of the
Company until June 30, 1996 at a salary rate of not less than
7
$530,040 per annum and as Chairman of the Company from July 1, 1996 through June
30, 1997 at a salary of $250,020. The Company and Mr. Bueche have also entered
into an agreement whereby Mr. Bueche will be retained as a consultant for two
years from the date of his retirement as Chairman at an annual fee of $250,020.
COMPENSATION COMMITTEE REPORT ON
EXECUTIVE COMPENSATION
--------------------------------------------------------------------------------
COMPENSATION STRUCTURE
Management has developed a compensation structure which the Compensation
Committee ("Committee") has approved and which is designed to attract and retain
skilled and experienced personnel and to reward superior performance.
The Committee's objective has been to develop total compensation programs
which provide competitive annual compensation and the opportunity for above
average long-term compensation tied to the Company's success in creating value
for its stockholders.
The philosophical basis of the compensation program is to pay for
performance and the level of responsibility of an individual's position.
Assessments of both individual and corporate performance influence executives'
compensation levels. The Company strives to encourage a performance-based
environment that motivates individual performance by recognizing current
achievements and stimulating future improvement. The key elements of such a
compensation structure are:
ANNUAL COMPENSATION -- consisting of base salary and bonus;
Under the Omnibus Budget Reconciliation Act of 1993, compensation paid to
certain executives of the Company in excess of $1 million in 1994 and subsequent
years may be non-deductible for federal income tax purposes unless the
compensation qualifies as "performance-based" compensation or is otherwise
exempt under the law and proposed Internal Revenue Service regulations issued in
December 1993. The Compensation Committee believes that the new law and proposed
regulations require clarification. For this reason, the Compensation Committee
has not developed any policy with respect to this matter. The Compensation
Committee will review this decision from time to time as the new law and
proposed regulations are clarified.
LONG-TERM COMPENSATION -- consisting of stock options, restricted stock
awards, and other long-term performance-based awards.
The Company utilizes this compensation structure to recognize meaningful
differences in individual performance and to provide all executives the
opportunity to exceed competitive levels of total compensation based on
outstanding company performance.
ANNUAL COMPENSATION -- BASE SALARY
Base salary levels for executives are established based on the Committee's
review of industry and national surveys of compensation levels and its review of
the recommendations of the compensation professionals employed by the Company.
The Committee strives to maintain salary levels which support the process of
management development and career orientation of executives consistent with the
long-term nature of the crop nutrient business. The Committee intends for salary
to comprise 30% to 35% of an executive's total long-term compensation.
ANNUAL COMPENSATION -- MANAGEMENT INCENTIVE COMPENSATION PLAN (BONUS)
To reward named executive officers for meeting annual goals as to earnings
per share, an annual bonus target equivalent to 45% to 60% of salary may be
payable after the end of the fiscal year if those goals are met. Additional
amounts may be payable if goals are exceeded and conversely, smaller amounts may
be paid, at the discretion of the Board, if goals are not met. Overall the
Committee plans for the Management Incentive Compensation Plan to comprise
between 20% to 25% of an executive's total compensation.
8
Awards are paid in cash but a participant may elect, at the beginning of the
fiscal year, to defer receipt to a future date. Deferred amounts bear interest
at the prime rate quoted by the Wall Street Journal under the heading "Money
Rates."
LONG-TERM COMPENSATION -- 1988 STOCK OPTION AND AWARD PLAN (STOCK OPTIONS)
The Company uses stock options as a component of its compensation package
because they align the interests of key management with those of the Company's
stockholders. Stock options provide such employees with the opportunity to buy
and maintain an equity interest in the Company as well as share in the
appreciation of the value of the Company's Common Stock. Options are awarded
periodically. 138,525 options were awarded in 1995. The options are exercisable
over a ten year period, subject to vesting requirements, and allow grantees to
purchase shares at the full market price of the stock on the day it was granted.
LONG-TERM COMPENSATION -- LONG-TERM PERFORMANCE INCENTIVE PLAN
Under the 1994 Long-Term Performance Incentive Plan, the named executives
were awarded shares of restricted Common Stock of the Company and contingent
stock units by the Compensation Committee of the Board of Directors. These
awards focus the executive upon the attainment of performance objectives. Shares
and units vest in increments that are established pursuant to the plan and
extend to the end of the performance period. Twenty percent of shares and units
vest based on service with the Company and eighty percent vest based on the
performance of the Company against the objective of earnings per share, over the
performance period. During the performance period, the participants receive
dividends and dividend equivalents on the shares and units, respectively, and
they are entitled to vote the shares but otherwise have no access to them until
they are vested. In the case of the restricted shares, restrictions on the
shares lapse on the date they are vested and stock certificates are delivered to
the participants. Upon vesting, contingent stock units are paid in cash at the
average market price of the Company's Common Stock on the vesting date. If
performance objectives are not met, the contingently awarded shares and
accompanying units are forfeited.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
The annual salary of Mr. Bueche, the Chief Executive Officer is $530,040.
This amount became effective July 1, 1994 and will remain effective through June
30, 1996. At his request, Mr. Bueche was awarded 10,000 stock options in lieu of
a July 1, 1995 salary increase. The number of options awarded was arrived at by
the Committee, by reviewing Mr. Bueche's performance since July 1, 1994.
Based on improved financial results for the Company for the 1995 fiscal
year, and such non-financial factors as strategic planning and management
development, Mr. Bueche received a bonus of $460,000. Awards of stock options,
restricted shares and contingent stock units are arrived at by evaluating Mr.
Bueche's job performance and by targeting an objective of 60% to 70% of his cash
compensation to be earned exclusively from at-risk, long term incentives.
Respectfully submitted to the Company's stockholders by the Compensation
Committee of the Board of Directors.
Richard A. Lenon, CHAIRMAN
Raymond F. Bentele
Thomas H. Roberts, Jr.
9
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth information as to the compensation of the
chief executive officer and each of the other four most highly compensated
executive officers of the Company (collectively the "Named Executive Officers")
serving as such on June 30, 1995.
SUMMARY COMPENSATION TABLE
--------------------------------------------------------------------------------------------------------------------------
LONG-TERM COMPENSATION
-------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
(A) ------------------------------------- ------------------------ -----------
(B) (C) (D) (E) (F) (G) (H) (I)
RESTRICTED SECURITIES
NAME AND OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
PRINCIPAL FISCAL SALARY BONUS COMPENSATION(3) AWARDS(4) OPTIONS/ PAYOUTS(5) COMPENSATION
POSITION YEAR $ $ $ $ SARS # $ $
---------------- ---------- --------- --------- --------------- ----------- ----------- ----------- --------------
W. F. Bueche 1995 530,040 460,000 0 0 10,000 298,141 52,441(6)
Chairman & CEO 1994 500,040 300,000 10,567 280,135 91,500 0 35,542(6)
1993(1) 180,143 0 5,212 420,500 0 0 31,542(6)
J. D. Speir 1995 320,435 220,000 0 36,600 12,900 120,933 35,883(7)
President & COO 1994 270,000 115,000 0 113,665 37,100 0 24,264(7)
1993 240,000 35,000 0 0 0 0 15,008(7)
R. C. Brauneker 1995 255,040 175,000 0 0 0 109,504 31,367(8)
Executive VP/CFO 1994 245,040 115,000 0 102,925 33,600 0 21,209(8)
1993 224,040 45,000 0 0 0 0 12,846(8)
C. S. Hoffman 1995 226,840 145,000 0 0 0 95,244 23,941(9)
Senior VP 1994 214,080 94,000 0 89,500 29,400 0 13,793(9)
1993 179,200 26,000 0 0 0 0 6,834(9)
M. I. Smith 1995 216,680 120,000 0 0 0 93,339 19,590(10)
Senior VP, 1994(2) 175,000 68,000 6,390 87,710 28,800 0 6,712(10)
Secretary
& General
Counsel
--------------------------------------------------------------------------------------------------------------------------
(1) Mr. Bueche's employment with the Company commenced on February 18, 1993.
(2) Mr. Smith's employment with the Company commenced on September 1, 1993.
(3) Represents payments to offset liabilities incurred for relocation expenses.
(4) Awards of restricted shares and contingent stock units under the Long-Term
Performance Incentive Plan which vest based on service with the Company.
The number of such shares and units held at the end of fiscal year 1995
was: Mr. Bueche 2,817 shares and 1,878 units; Mr. Speir 1,719 shares and
1,146 units; Mr. Brauneker 1,035 shares and 690 units; Mr. Hoffman 900
shares and 600 units; and Mr. Smith 882 shares and 588 units. Dividends are
paid on awards. The shares and units will vest as follows: Mr. Bueche 939
shares and 626 units on January 1, 1996, and 1,878 shares and 1,252 units
on June 30, 1997; Mr. Speir 144 shares and 96 units on August 18, 1995, 525
shares and 350 units on January 1, 1996, and 1,050 shares and 700 units on
June 30, 1997; Mr. Brauneker 345 shares and 230 units on January 1, 1996,
and 690 shares and 460 units on June 30, 1997; Mr. Hoffman 300 shares and
200 units on January 1, 1996, and 600 shares and 400 units on June 30,
1997; and Mr. Smith 294 shares and 196 units on January 1, 1996, and 588
shares and 392 units on June 30, 1997. The value of the shares and units at
the end of the fiscal year was $254,117, $155,069, $93,366, $81,188, and
$79,564 for Messrs. Bueche, Speir, Brauneker, Hoffman and Smith,
respectively, based on a June 30, 1995 stock price of $54.125 as quoted on
the New York Stock Exchange.
(5) Reflects restricted shares distribution and contingent stock units payouts
that vested June 30, 1995, earned for performance under the Company's
Long-Term Performance Incentive Plan.
(6) The reported amounts for 1995, 1994 and 1993 consist, respectively, of:
(i) $34,638, $35,542 and $31,542 which represent the value of the benefit
for life insurance premiums paid by the Company; and
(ii) $17,803, $0 and $0 which represent the amount of contributions made by
the Company to the Defined Contribution Savings Plan.
(7) The reported amounts for 1995, 1994 and 1993 consist, respectively, of:
(i) $18,775, $14,990 and $11,408 which represent the value of the benefit
for life insurance premiums paid by the Company; and
(ii) $17,108, $9,274 and $3,600 which represent the amount of contributions
made by the Company to the Defined Contribution Savings Plan.
(8) The reported amounts for 1995, 1994 and 1993 consist, respectively, of:
(i) $14,531, $12,382 and $9,483 which represent the value of the benefit for
life insurance premiums paid by the Company; and
(ii) $16,836, $8,827 and $3,363 which represent the amount of contributions
made by the Company to the Defined Contribution Savings Plan.
10
(9) The reported amounts for 1995, 1994 and 1993 consist, respectively, of:
(i) $7,343, $6,082 and $4,206 which represent the value of the benefit for
life insurance premiums paid by the Company; and
(ii) $16,598, $7,711 and $2,628 which represent the amount of contributions
made by the Company to the Defined Contribution Savings Plan.
(10) The reported amounts for 1995 and 1994 consist, respectively, of:
(i) $13,822 and $6,712 which represent the value of the benefit for life
insurance premiums paid by the Company; and
(ii) $5,768 and $0 which represent the amount of contributions made by the
Company to the Defined Contribution Savings Plan.
The following table sets forth information with respect to all stock options
granted in fiscal 1995 to each of the Named Executive Officers. There were no
grants of stock appreciation rights (SARs) in fiscal 1995.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
--------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS GRANT DATE VALUE
------------------------------------------------------ --------------------
(A) (B) (C) (D) (E) (F)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED (#) FISCAL YEAR ($/SHARE) DATE PRESENT VALUE ($)(3)
------------------------- ------------ ------------ ----------- ---------- --------------------
W. F. Bueche 10,000(1) 7.2% $48.3125 06/14/05 $ 160,800
J. D. Speir 12,900(2) 9.3% 38.1250 08/17/04 181,245
R. C. Brauneker 0
C. S. Hoffman 0
M. I. Smith 0
(1) One-half of the number of stock options granted to Mr. Bueche will become
exercisable on the first and second anniversaries of the date of grant.
(2) One-third of the number of stock options granted to Mr. Speir will become
exercisable on the first, second and third anniversaries of the date of
grant.
(3) The Black-Scholes Option Pricing Model was used to determine the grant date
present value of the stock options granted in fiscal 1995 by the Company to
the Named Executive Officers. Under the Black-Scholes Option Pricing Model,
the grant date present value of the stock options referred to in the table
was $16.08 for Mr. Bueche and $14.05 for Mr. Speir. The material
assumptions and adjustments incorporated in the model in estimating the
value of the options include the following:
(i) an exercise price on the option of $48.3125 and $38.125 for Messrs.
Bueche and Speir, respectively, equal to the fair market value of the
underlying stock on the date of grant;
(ii) an option term of ten years;
(iii) an interest rate of 5.93 percent and 7.24 percent for Messrs. Bueche and
Speir, respectively, representing the interest rate on a U.S. Treasury
security with a maturity date corresponding to that of the option term;
(iv) volatility of 28.10 percent and 36.925 percent for Messrs. Bueche and
Speir, respectively, calculated using daily stock prices for the
one-year period prior to the grant date;
(v) dividends at the rate of $.40 per share representing the annualized
dividends paid with respect to a share of common stock at the date of
grant.
(vi) reductions of approximately 13.34 percent and 17.64 percent for Messrs.
Bueche and Speir, respectively, to reflect the profitability of
forfeiture due to termination prior to vesting and approximately 17.46
percent and 15.22 percent for Messrs. Bueche and Speir, respectively, to
reflect the probability of a shortened option term due to termination of
employment prior to the option exercise date.
The ultimate value of the options will depend on the future market price of
the Company's stock, which cannot be forecast with reasonable accuracy. The
actual value, if any, an optionee will realize upon exercise of an option will
depend on the excess of the market value of the Company's common stock over the
exercise price on the date the option is exercised.
11
The following table sets forth information with respect to all exercises of
Company stock options and SARs in fiscal 1995 by each of the Named Executive
Officers and all outstanding Company stock options and SARs held by each of the
Named Executive Officers as of June 30, 1995.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
-----------------------------------------------------------------------------------------------------------------------------
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED IN-
OPTIONS/SARS AT FISCAL THE-MONEY OPTIONS/SARS AT
YEAR-END (#) FISCAL YEAR-END ($)(1)
--------------------------- ---------------------------
(A) (B) (C) (D) (E) (F) (G)
SHARES ACQUIRED VALUE REALIZED
NAME ON EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------------ ---------------- -------------- ----------- ------------- ----------- -------------
W. F. Bueche 0 0 30,500 71,000 6$08,094 1,2$74,313
J. D. Speir 0 0 29,966 37,634 463,823 699,535
R. C. Brauneker 0 0 33,100 22,400 549,588 446,600
C. S. Hoffman 0 0 18,800 19,600 222,388 390,775
M. I. Smith 0 0 9,600 19,200 191,400 382,800
-----------------------------------------------------------------------------------------------------------------------------
(1) The value is calculated based on a June 30, 1995 stock price of $54.124 as
quoted on the New York Stock Exchange less the relevant exercise price.
The following table sets forth certain information concerning awards made to
the Named Executive Officers under the Company's Long-Term Performance Incentive
Plan during fiscal 1995.
LONG-TERM INCENTIVE PLANS - AWARDS IN
LAST FISCAL YEAR
-------------------------------------------------------------------------------------------------------
ESTIMATED FUTURE PAYOUTS UNDER
NON-STOCK PRICE BASED PLANS
(C) --------------------------------------
(B) PERFORMANCE OR (D)
(A) NUMBER OF OTHER PERIOD (E) (F)
SHARES, UNTIL
UNITS OR OTHER MATURATION OR THRESHOLD
NAME RIGHTS (#)(1) PAYOUT (#) TARGET (#) MAXIMUM (#)
----------------------------- -------------- ---------------- ----------- ----------- ------------
W. F. Bueche 0
J. D. Speir 2,880 shares 1/1/94 to 288 shares 1,008 2,880 shares
1,920 units 6/30/97 192 units shares 1,920 units
672 units
R.C. Brauneker 0
C. S. Hoffman 0
M. I. Smith 0
-------------------------------------------------------------------------------------------
(1) Awards of restricted shares and contingent stock units under the Long-Term
Performance Incentive Plan. Awards are earned on the basis of the
performance of the Company against the objective of earnings per share for
the fiscal years ending June 30, 1995; June 30, 1996; and June 30, 1997.
One-half of the award earned will vest on June 30 of the fiscal year earned
(unless the award is earned as of June 30, 1995, then the award will vest
on August 18, 1995), and one-half will vest on June 30, 1997. Restrictions
on the shares lapse on the date they are vested, and stock certificates are
delivered to the participant. Contingent stock units are paid in cash at
the average selling price of the Company's common stock on the date of the
applicable vesting or the first business day following such date. If a
participant voluntarily terminates employment with the Company, he forfeits
all his awards that have not previously vested.
12
PENSION PLANS
IMC Global Inc. maintains a non-contributory qualified pension plan which
covers all U. S. salaried employees, including Company officers. The annual
pension to which a participant is entitled at normal retirement age (65) is an
amount based on the highest final average annual remuneration for the five
highest paid years out of the ten years immediately preceding retirement and
years of credited service up to 35 years. The plan is integrated with benefits
payable under Old Age Survivors and Disability Insurance. Remuneration for these
purposes includes salary and 50% of bonus as shown in the Summary Compensation
Table.
The Internal Revenue Code of 1986, as amended (the "Code"), requires certain
limitations on benefits provided under a qualified retirement plan. To the
extent pension benefits otherwise payable under the qualified pension plan's
formula exceed the Code's limitations, the Board of Directors has approved a
non-qualified plan, the Supplemental Executive Retirement Plan, which provides
for payment of amounts in excess of the Code's limitations from the Company's
operating funds to its participants.
The following table shows the estimated annual pension benefits, which would
be payable to the named executive officers for life at normal retirement under
the qualified pension plan. (If elected, an optional form of pension would, on
an actuarial basis, reduce benefits to the participant but provide benefits to a
surviving beneficiary or permit a one-time lump sum present value payment.)
ANNUAL AVERAGE OF
HIGHEST FIVE YEARS ANNUAL BENEFITS FOR YEARS
COVERED REMUNERATION OF SERVICE INDICATED
FOR PENSION PURPOSES ----------------------------------------------------------------
IN TEN YEARS PRECEDING 35 YEARS
NORMAL RETIREMENT DATE 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS OR MORE
---------------------- --------- --------- --------- --------- --------- ---------
$ 100,000 $ 16,700 $ 25,100 $ 33,400 $ 41,800 $ 48,400 $ 54,900
200,000 34,500 51,800 69,000 86,300 100,000 113,700
300,000 52,300 78,500 104,600 130,800 151,700 172,500
400,000 70,100 105,200 140,200 175,300 203,300 231,300
500,000 87,900 131,900 175,800 219,800 255,000 290,100
600,000 105,700 158,600 211,400 264,300 306,600 348,900
700,000 123,500 185,300 247,000 308,800 358,300 407,700
800,000 141,300 212,000 282,600 353,300 409,900 466,500
900,000 159,100 238,700 318,200 397,800 461,600 525,300
----------------------------------------------------------------------------------------
Credited service under the pension plan as of June 30, 1995 for the named
executives is as follows: Mr. Bueche, 2 years, 5 months; Mr. Speir, 32 years, 11
months; Mr. Brauneker, 35 years; Mr. Hoffman, 21 years, 3 months and Mr. Smith,
1 year, 10 months.
The Supplemental Executive Retirement Plan, which is a non-contributory,
non-qualified plan, provides an additional pension benefit for Company executive
officers and certain other key executives based on the participant's final
average annual remuneration for pension purposes, but taking into account 100%
of bonus and years of credited service up to a maximum of 20, payable to the
extent that such benefits exceed those payable under the above-described
qualified retirement plan. There are no other offsets under this plan.
13
The following table shows the additional amount of annual retirement benefit
payable under the Supplemental Executive Retirement Plan to covered officers and
key employees for life beginning at age 65, based upon 10, 15 and 20 or more
years of service.
ANNUAL AVERAGE OF NET ADDITIONAL
HIGHEST FIVE YEARS ANNUAL BENEFITS
COVERED REMUNERATION FOR YEARS OF
FOR PENSION PURPOSES SERVICE INDICATED
IN TEN YEARS PRECEDING -------------------------------
NORMAL RETIREMENT DATE 10 YRS. 15 YRS. 20 YRS.
---------------------- --------- --------- ---------
$ 100,000 $ 13,300 $ 19,900 $ 26,600
200,000 25,500 38,200 51,000
300,000 37,700 56,500 75,400
400,000 49,900 74,800 120,000
500,000 62,100 105,000 180,000
600,000 74,300 150,000 240,200
700,000 90,000 195,000 300,000
800,000 120,000 240,000 360,000
900,000 150,000 285,000 420,000
-------------------------------------------------------
COMPANY STOCK PERFORMANCE
The following graph compares the cumulative total return for the Company's
common shares with the Standard & Poor's 500 Index and the Media General
Industry Group 102, a representative industry peer group:
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
IMC GLOBAL OPERATIONS INC., S&P 500, AND PEER GROUP
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
IMC GLOBAL S&P 500 PEER GROUP
June 1990 100.00 100.00 100.00
June 1991 135.02 107.39 99.24
June 1992 128.16 121.73 105.91
June 1993 89.68 138.26 101.45
June 1994 105.71 140.24 122.95
June 1995 166.26 176.69 159.30
*Total return assumes reinvestment of dividends on a quarterly basis.
14
PEER GROUP
Alcide Corporation
Arcadian Partners
Consep Inc.
First Mississippi Corporation
Freeport McMoRan Inc.
Freeport McMoRan Resources
Great American Management &
Investment
Harmony Products Inc.
Lesco Inc.
Mycogen Corporation
Natural Earth Technologies
Norsk Hydro
Nu West Industries, Inc.
Rich Coast
Ringer Corporation
Terra Industries Inc.
Terra Nitrogen Company
U.S. Lime & Minerals
MANAGEMENT COMPENSATION AND BENEFIT ASSURANCE PROGRAM
The Board adopted a Management Compensation and Benefit Assurance Program
(the "Program") in October, 1988 and amended this Program in August of this
year. The purpose of this program is to ensure that officers and key management
personnel receive the compensation and benefits that have been committed to and
are reasonably expected by them under the terms of certain benefit plans,
including severance and benefits in the event of termination of employment after
a change in control.
Under the Program, trusts have been established with the Wachovia Bank of
North Carolina, N.A. of Winston-Salem, North Carolina to ensure appropriate
payment when due of commitments, awards and benefits under the Management
Incentive Compensation Plan (including any deferred bonuses), the Supplemental
Executive Retirement Plan, the Long-Term Performance Incentive Plan, the Stock
Option Plan, the contingent employment agreements referred to on page 7 and the
gross-up arrangements also referred to on page 7. These trusts are minimally
funded with operating funds of the Company, subject to full funding in the event
that the Trustee is notified that a change in control has occurred or is about
to occur.
Assuming a change in control occurred, distributions by the Trustee would be
made only if an officer was involuntarily terminated without cause within three
years after a Change in Control and/or only to the extent the Company failed to
honor its commitments and subject to the claims of the Company's creditors and
to the terms of the benefit plan involved. The annual cost to the Company to
maintain the trusts is estimated to be $21,000. Full funding under the
arrangements that could be required would depend on the Company's outstanding
commitments subject to the Program from time to time.
Incident to the adoption and amendment of the above Assurance Program,
compensation and benefit plans of the Company were amended as follows: the Stock
Option Plan and the Long-Term Performance Incentive Plan were amended to permit
the conversion of restricted shares and contingent stock units, the vesting of
which would be accelerated by the occurence of a change in control, as defined
within the Program and the Plan, into their dollar value on the date of a Change
in Control and the payment of the equivalent thereof into the trusts for
distribution to the grantees at a specified later time; the Management Incentive
Compensation Plan was amended to provide for payment of prorated target bonus
awards in the event a participant is involuntarily terminated without cause
after a change in control; the Supplemental Executive Retirement Plan was
amended to provide for immediate vesting of participants who are involuntarily
terminated without cause after a change in control; and the Retirement Plan for
Salaried Employees was amended to provide immediate vesting upon involuntary
termination without cause after a Change in Control and for credited service for
severance periods, if any.
"Change in Control" of the Company is defined to occur as of the first day
that any one or more of the following conditions shall have been satisfied:
(1) the acquisition by any individual, entity or group (a "Person"),
including any "person" within the meaning of Section 13(d)(3) or 14(d)(2) of
the Exchange Act, of beneficial ownership within the meaning of Rule 13d-3
promulgated under the Exchange Act, of 15% or more of either (i) the then
outstanding shares of common stock of the Company (the "Outstanding Company
Common Stock") or (ii) the combined voting power of the then outstanding
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); excluding, however,
the following: (A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of an exercise, conversion or
exchange privilege unless the security being so exercised, converted or
exchanged was acquired directly from the Company;
15
(B) any acquisition by the Company, (C) any acquisition by an employee
benefit plan (or related trust) sponsored or maintained by the Company or
any corporation controlled by the Company of (D) any acquisition by any
corporation pursuant to a transaction which complies with clauses (i), (ii)
and (iii) of subsection (3) of this definition;
(2) individuals who, as of the date hereof, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to constitute at
least a majority of such Board; provided that any individual who becomes a
director of the Company subsequent to the date hereof whose election, or
nomination for election by the Company's stockholders, was approved by the
vote of at least a majority of the directors then comprising the Incumbent
Board shall be deemed a member of the Incumbent Board; and provided further,
that any individual who was initially elected as a director of the Company
as a result of an actual or threatened election contest, as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, or
any other actual or threatened solicitation of proxies or consents by or on
behalf of any Person other than the Board shall not be deemed a member of
the Incumbent Board;
(3) approval by the stockholders of the Company of a reorganization,
merger or consolidation or sale or other disposition of all or substantially
all of the assets of the Company (a "Corporate Transaction"); excluding,
however, a Corporate Transaction pursuant to which (i) all or substantially
all of the individuals or entities who are the beneficial owners,
respectively, of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities immediately prior to such Corporate Transaction
will beneficially own, directly or indireclty, more than 60% of,
respectively, the outstanding shares of common stock, and the combined
voting power of the outstanding securities of such corporation entitled to
vote generally in the election of directors, as the case may be, of the
corporation resulting from such Corporate Transaction (including, without
limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly
or indirectly) in substantially the same proportions relative to each other
as their ownership, immediately prior to such Corporate Transaction, of the
Outstanding Company Common Stock and the Outstanding Company Voting
Securities, as the case may be, (ii) no Person (other than: the Company; the
corporation resulting from such Corporation Transaction; and any Person
which beneficially owned, immediately prior to such Corporate Transaction,
directly or indirectly, 25% or more of the Outstanding Company Common Stock
of the corporation resulting from such Corporate Transaction or the combined
voting power of the outstanding securities of such corporation entitled to
vote generally in the election of directors and (iii) individuals who were
members of the Incumbent Board will constitute at least a majority of the
members of the board of directors of the corporation resulting from such
Corporate Transaction; or
(4) approval by the stockholders of the Company of a plan of complete
liquidation or dissolution of the Company.
16
AMENDMENT TO 1988 STOCK OPTION AND AWARD PLAN
----------------------------------------------------------------------------
In order to provide employees of the Company with additional incentive to
contribute to the success of the Company by making available to them an
opportunity to acquire Common Stock ownership in the Company, the Company
adopted a Stock Option and Award Plan for officers and other key employees which
was approved by the sole stockholder of the Company on September 24, 1987 and
became effective February 3, 1988.
The Plan authorized an aggregate of 1,000,000 shares of Common Stock to be
sold through the exercise of options issuable pursuant to the Plan. The
Compensation Committee of the Board of Directors has the authority to determine
the number of shares to be subject to options granted to such officers and other
key employees as it selects to receive options. As of August 1, 1995, 384
employees held options under the Plan to purchase a total of 857,450 shares of
Common Stock and 481,600 shares of Common Stock had been acquired by employees
upon exercise of options under the Plan. In connection with a long-term
incentive plan, 15 employees hold 59,525 shares of restricted Common stock.
PROPOSED AMENDMENT AND RESTATEMENT
As of August 1, 1995 only 253,000 shares were available under the Plan for
issue in connection with stock options or restricted stock awards. Accordingly,
on August 17, 1995, the Board of Directors adopted an amendment and restatement
to the Plan, subject to stockholder approval, which would provide for an
increase in the number of shares which may be awarded under the Plan to
3,000,000 shares from 2,000,000 shares. A copy of the Plan, as amended and
restated, is attached to this proxy statement as Exhibit A. The following
summary of changes made by such amendment and restatement is qualified by
Exhibit A. The additional 1,000,000 shares which could be awarded under the Plan
are believed necessary so that an adequate number of shares is available for
purposes of the Plan.
The Plan has also been amended and restated to make certain changes to
reflect amendments to Rule 16(b)-3 under the Securities Exchange Act of 1934 and
the $1 million compensation limit continued in Section 162(m) of the Internal
Revenue Code.
Other changes allow the Committee to delegate its authority regarding
non-insiders to the Chairman and Chief Executive Officer or other executive
officers selected by the Committee. The Amended and Restated Plan allows the
Committee to designate options as incentive stock options under the Internal
Revenue Code.
The Amended and Restated Plan deletes the prior provisions giving the
Committee discretion regarding the determination of a change in control and the
effect of such change. The provision regarding limited stock appreciation rights
has been deleted.
The Amended and Restated Plan provisions also provide for the automatic
acceleration of vesting of options and awards. If the consideration involved in
a change in control is registered securities, the acquiring company's securities
are automatically substituted for the Company's but the other terms of the
options and awards (other than vesting) remain in effect. If a Change of Control
involves cash or property other than registered securities, all options and
awards are automatically converted into their cash equivalents.
The definition of Change in Control is amended identically as in all other
affected plans.
The following is a brief summary of certain of the U.S. federal income tax
consequences generally arising with respect to grants and awards under the Plan.
STOCK OPTIONS. A participant will not recognize any income upon the grant
of a stock option. A participant will recognize compensation taxable as ordinary
income (and subject to income tax withholding) upon exercise of a non-qualified
stock option equal to the excess of the fair market value of the shares
purchased over their exercise price, and the Company will be entitled to a
corresponding deduction. A participant will not recognize any income (except for
purposes of the alternative minimum tax) upon exercise of an incentive stock
option. If the shares acquired by exercise of an incentive stock option are held
for the longer of two years from the date the option was granted and one year
from the date it was exercised, any gain or loss arising from a subsequent
disposition of such shares will be taxed as long-term capital gain or loss, and
the Company will not be entitled to any deduction. If, however, such shares are
disposed of within such period, then in the year of such disposition the
participant will recognize compensation taxable as ordinary income equal to the
excess of the lesser of the excess of (A) either (i) the amount realized upon
such disposition and (ii) the fair market value of such shares on the date of
exercise, over (B) the exercise price, and the Company will be entitled to a
corresponding deduction.
17
SARS. A participant will not recognize any income upon the grant of SARs. A
participant will recognize compensation taxable as ordinary income (and subject
to income tax withholding) upon exercise of an SAR equal to the fair market
value of any shares delivered and the amount of cash paid by the Company upon
such exercise, and the Company will be entitled to a corresponding deduction.
RESTRICTED STOCK AND STOCK UNITS. A participant will not recognize any
income at the time of the grant of shares of restricted stock (unless the
participant makes an election to be taxed at the time the restricted stock is
granted) or stock units, and the Company will not be entitled to a tax deduction
at such time. A participant will recognize compensation taxable as ordinary
income at the time the restrictions lapse on restricted stock (if such election
was not made) and stock units in an amount equal to the excess of the fair
market value of the shares or units at such time over the amount, if any, paid
for such shares or units. The amount of ordinary income recognized by a
participant is deductible by the Company as compensation expense, except to the
extent the deduction limit of section 162(m) of the Code (described below)
applies. In addition, a participant receiving dividends with respect to
restricted stock for which the above-described election has not been made and
prior to the time the restrictions lapse will recognize compensation taxable as
ordinary income (subject to income tax withholding), rather than dividend
income, in an amount equal to the dividends paid and the Company will be
entitled to a corresponding deduction, except to the extent the deduction limit
of section 162(m) of the Code applies. A participant will recognize compensation
taxable as ordinary income (subject to income tax withholding) when amounts
attributable to stock units are paid (or made available) and the Company will be
entitled to a corresponding deduction, except to the extent the deduction limit
of section 162(m) of the Code applies.
CASH BONUS AWARDS. A participant will not recognize any income upon the
grant of a bonus award payable in cash and the Company will not be entitled to a
tax deduction at such time. At the time such award is paid (or made available),
the participant will recognize compensation taxable as ordinary income (subject
to income tax withholding) in an amount equal to any cash paid by the Company,
and the Company will be entitled to a corresponding deduction, except to the
extent the deduction limit of section 162(m) of the Code applies.
The proposed amendment and restatement will not be effective unless it is
approved by the vote of the holders of a majority of the outstanding shares of
the Company's Common stock present in person or by proxy at the 1995 Annual
Meeting and entitled to vote on the proposed amendment and restatement.
The Board of Directors recommend that the stockholders vote FOR adoption of
the proposed amendment and restatement (Item No. 2 on the proxy card).
18
AMENDMENT TO THE RESTATED CERTIFICATE OF INCORPORATION
TO INCREASE AUTHORIZED COMMON STOCK
----------------------------------------------------------------------------
The Board of Directors has unanimously approved, declared advisable and
recommends that the stockholders consider and approve an amendment (the
"Amendment") to ARTICLE FOURTH of the Company's Restated Certificate of
Incorporation (the "Certificate") pursuant to which the authorized amount of
shares of Common Stock would be increased from 50 million shares to 100 million
shares. The Certificate also currently authorizes the issuance of up to 12
million shares of Series Preferred Stock, par value $1.00 per share (the "Series
Preferred Stock"), of which no shares are issued and outstanding. The Amendment
would not alter the authorized amount of Series Preferred Stock.
The resolution to be voted upon to effect the Amendment is set out in
Exhibit B to this Proxy Statement.
PURPOSE AND EFFECTS OF THE AMENDMENT
As of August 31, 1995, there were shares of Common Stock issued and
outstanding. In addition, approximately million shares were reserved in the
aggregate for issuance pursuant to the 1988 Stock Option and Award Plan and the
1994 Long-Term Performance Incentive Plan and approximately 1.8 million shares
were reserved in the aggregate for issuance in connection with the conversion of
the 6.15% Convertible Subordinated Notes due 2001. As a result, the Company has
approximately million shares of Common Stock which are not outstanding or
reserved for issuance.
The Board of Directors believes that the flexibility provided by the
Amendment to permit the Company to issue or reserve additional Common Stock, in
the discretion of the Board of Directors, without the delay or expense of a
special meeting of stockholders, is in the best interest of the Company and its
stockholders. Shares of Common Stock may be used for general corporate purposes,
including stock splits and stock dividends, acquisitions, public offerings,
stock option and other employee benefit plans.
Pursuant to the Certificate, stockholders of the Company have no preemptive
rights with respect to the additional shares of Common Stock being authorized.
The Certificate does not require further approval of stockholders prior to the
issuance of any additional shares of Common Stock. In certain circumstances
(generally relating to the number of shares to be issued, the manner of offering
and the identity of the recipients), the rules of the New York Stock Exchange
(the "NYSE") may require specific authorization in connection with the issuance
of such additional shares. The Company does not anticipate that it will seek
authorization from stockholders for issuance of additional shares of Common
Stock unless required by applicable laws or the NYSE.
The issuance of any additional shares of Common Stock may have the effect of
diluting the percentage of stock ownership, book value per share and voting
rights of the present holders of the Common Stock. The Amendment also may have
the effect of discouraging attempts to take over control of the Company, as
additional shares of Common Stock could be issued to dilute the stock ownership
and voting power, or increase the cost to, a party seeking to obtain control of
the Company. The Amendment is not being proposed in response to any known effort
or threat to acquire control of the Company and is not part of a plan by
management to adopt a series of amendments to the Certificate and By-Laws having
an anti-takeover effect. The Certificate and By-Laws of the Company also contain
certain provisions that could have the effect of deterring takeover attempts.
In accordance with Delaware law, the affirmative vote of the holders of a
majority of the outstanding shares of Common Stock entitled to vote with respect
to the Amendment is required to approve the Amendment. Accordingly, abstentions
and broker non-votes applicable to shares present at the meeting will have the
same effect as votes cast against approval of the amendment. If the Amendment is
approved, the Company intends to file the Amendment with the Secretary of State
of Delaware as soon as practicable.
The Board of Directors recommends that the stockholders vote FOR the
proposed Amendment (Item No. 3 on the proxy card).
19
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
----------------------------------------------------------------------------
The Board of Directors, upon recommendation of the Audit Committee,
appointed Ernst & Young LLP as independent public auditors to examine and report
on the financial statements of the Company and its subsidiaries and affiliates
for the fiscal year ending June 30, 1996, subject to stockholder approval at the
annual meeting.
During the fiscal year ended June 30, 1995, Ernst & Young LLP provided the
Company with audit services, including examinations of and reporting on the
Company's consolidated financial statements, as well as those of several of its
subsidiaries and affiliates and of certain of its employee benefit plans. Audit
services also included accounting advisory services and review of filings with
the Securities and Exchange Commission and the annual report to shareholders.
Ernst & Young LLP also performed certain non-audit services for the Company such
as federal, state and local tax advisory services.
Representatives of Ernst & Young LLP are expected to be present at the
Annual Meeting and will have the opportunity to make any statements they may
desire. They also will be available to respond to appropriate questions of the
stockholders.
Ratification of the appointment of Ernst & Young LLP as independent auditors
requires the affirmative vote of a majority of the shares of the Company's
Common Stock represented at the meeting in person or by proxy.
The Board of Directors recommends that the stockholders vote FOR
ratification of the appointment of Ernst & Young LLP as the principal
independent auditors of the Company (Item No. 4 on the proxy card).
MISCELLANEOUS INFORMATION
----------------------------------------------------------------------------
The Board of Directors and management know of no matters which will be
presented for consideration at the meeting other than those stated in the notice
of meeting and described in this proxy statement.
DISCRETIONARY VOTING AUTHORITY
If any matter properly comes before the meeting, the persons named in the
accompanying proxy form will vote such proxy in accordance with their judgment
regarding such matters, including the election of a director or directors other
than those named herein should an emergency or unexpected occurrence make the
use of discretionary authority necessary, and also regarding matters incident to
the conduct of the meeting.
STOCKHOLDER PROPOSALS AND NOMINATIONS FOR THE 1996 ANNUAL MEETING
For stockholders who may be interested in submitting a resolution for
consideration at the 1996 annual stockholders' meeting, the deadline for
submitting such proposals in order to be considered for inclusion in the proxy
statement is May 10, 1996. The Committee on Directors and Board Affairs
considers stockholder recommendations of future nominees for election to the
Board of Directors. The By-Laws of the Company provide that a stockholder
wishing to nominate a candidate for election to the Board is required to give
written notice to the Secretary of the Company of his or her intention to make
such a nomination. The notice of nomination must be received by the Company not
less than sixty days prior to the stockholder's meeting or within ten days after
the Company has mailed to stockholders a notice of annual meeting of
stockholders, whichever is later. The notice of nomination is required to
contain certain information about both the nominee and the stockholder making
the nomination. The Company may require that the proposed nominee furnish other
information to determine that person's eligibility to serve as director. A
nomination which does not comply with the above procedure will be disregarded.
Proposals should be sent to the Secretary of the Company, 2100 Sanders Road,
Northbrook, Illinois 60062.
PROXY SOLICITATION AND EXPENSES
Proxies are solicited by the Board of Directors and management to assure
that stockholders who are unable to attend the meeting have the opportunity
nonetheless to cast a vote on the issues to come before the meeting. In addition
to the use of the mails, proxies may be solicited by personal interview,
telephone and telegrams by directors, officers and employees of the Company.
Arrangements may also be made with brokerage houses and other custodians,
nominees and fiduciaries for the forwarding of solicitation material to the
beneficial owners of stock held of record by such persons, and the Company may
reimburse them for reasonable out-of-pocket expenses incurred by them in
connection
20
therewith. In addition, the Company has retained Morrow & Co. Inc. to aid in the
solicitation, at an estimated cost of $6,500.00, plus expenses. The cost of all
proxy solicitation, including payments to Morrow & Co., Inc. will be borne by
the Company.
The giving of the proxy does not affect the right to vote in person should
the stockholder be able to attend the meeting. Such proxy may be revoked at any
time prior to the effective exercise thereof by the execution of a subsequent
proxy or, if the stockholder attends the meeting and wants to vote in person, by
notifying the Secretary at the meeting of his other intention to so vote.
Prompt execution and return of the proxy is requested in order to assure the
presence, in person or by proxy, of the holders of a majority of the shares
entitled to vote at the meeting, which is required for a quorum.
By order of the Board of Directors
SENIOR VICE PRESIDENT, SECRETARY
AND GENERAL COUNSEL
Dated: September 8, 1995
21
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
----------------------------------------------------------------------------
I. PURPOSE
The purpose of this plan is to further the growth and success of the Company
and its subsidiaries by providing key employees with additional incentive to
contribute to such growth and success and by aiding the Company in attracting
and retaining such key employees.
II. ADMINISTRATION OF THE PLAN
The Board of Directors of the Company shall appoint a committee (the
"Committee") of not less than three of its members to administer the Plan. A
majority of the members of the Committee shall constitute a quorum, and the acts
of a majority of the members present at any meeting at which a quorum is
present, or acts approved in writing by a majority of the members of the
Committee, shall be the acts of the Committee. Each member of the Committee
shall be (i) a "disinterested person" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and (ii) shall
qualify as an "outside director" within the meaning of Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code"). The Committee shall have
the power to grant options, stock appreciation rights and awards of Restricted
Stock ("Restricted Stock Awards") under the Plan, to interpret the Plan and
options, stock appreciation rights and Restricted Stock Awards granted under it,
to make regulations and to formulate administrative provisions for carrying out
the Plan, and to make all other determinations in connection with the granting
of options, stock appreciation rights and Restricted Stock Awards and
administration of the Plan.
The Committee may delegate some or all of its power and authority hereunder
to the [Chairman and Chief Executive Officer] or other executive officer of the
Company as the Committee deems appropriate; provided, however, that the
Committee may not delegate its power and authority with regard to (i) the grant
of an award under this Plan to any person who is a "covered employee" within the
meaning of Section 162(m) of the Code and the regulations thereunder who, in the
Committee's judgment, is likely to be a covered employee at any time during the
period an award hereunder to such employee would be outstanding or (ii) the
selection for participation in this Plan of an officer or other person subject
to Section 16 of the Exchange Act or decisions concerning the timing, pricing or
amount of an award to such an officer or other person.
III. STOCK SUBJECT TO THE PLAN
(a) The stock to be offered for sale by the Company pursuant to exercise of
options or which may be delivered upon the exercise of stock appreciation rights
or which may be delivered pursuant to Restricted Stock Awards granted under the
Plan shall be shares of the authorized Common Stock, par value $1.00 per share,
of the Company (hereafter sometimes call the "Stock") and may consist of either
unissued shares or shares reacquired by the Company, or a combination of both as
the Board of Directors or the Committee may from time to time determine. Subject
to the provisions of subsection (b) of this Section 3, the aggregate number of
shares of Stock which may be delivered under the Plan shall not exceed 3,000,000
shares, reduced by the sum of the aggregate number of shares of Common Stock (i)
that are issued upon the grant of Restricted Stock Awards and (ii) which become
subject to outstanding options. To the extent that shares of Common Stock
subject to an outstanding option (except to the extent shares of Common Stock
are issued or delivered by the Company in connection with the exercise of a
stock appreciation right) or Restricted Stock Award are not issued or delivered
by reason of the expiration, termination, cancellation or forfeiture of such
award or by reason of the delivery or withholding of shares of Common Stock to
pay all or a portion of the exercise price of an award, if any, or to satisfy
all or a portion of the tax withholding obligations relating to an award, then
such shares of Common Stock shall again be available under this Plan.
Except as set forth in this Section 3, any securities resulting from any
stock divided, stock split, stock distribution or other recapitalization or any
substituted securities in the event of any substitution referred to in the this
Section 3, shall be subject to the shares covered by the related option, stock
appreciation right or Restricted Stock Award pursuant to the Plan including, in
the case of a Restricted Stock Award, escrow of such shares or other securities.
A-1
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
III. STOCK SUBJECT TO THE PLAN (CONTINUED)
(b) (1) In the event of any stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, combination, exchange of shares,
liquidation, spin-off or other similar change in capitalization or event, or any
distribution to holders of Common Stock other than a regular cash dividend, the
number and class of securities available under this Plan, the number and class
of securities subject to each outstanding option and the purchase price per
security, the terms of each outstanding stock appreciation right, and the number
and class of securities subject to each outstanding Restricted Stock Award shall
be appropriately adjusted by the Committee, such adjustments to be made in the
case of outstanding options without an increase in the aggregate purchase price.
The decision of the Committee regarding any such adjustment shall be final,
binding and conclusive. If any such adjustment would result in a fractional
security being (i) available under this Plan, such fractional security shall be
disregarded, or (ii) subject to an award under this Plan, the Company shall pay
the holder of such award, in connection with the first vesting or exercise of
such award, in whole or in part, occurring after such adjustment, an amount in
cash determined by multiplying (i) the fraction of such security (rounded to the
nearest hundredth) by (ii) the excess, if any, of (A) the fair market value
(determined in accordance with Section 6) on the vesting or exercise date over
(B) the exercise price, if any, of such award.
(2) Notwithstanding any provision in this Plan or any agreement, in the
event of a Change in Control in connection with which the holders of Common
Stock receive shares of common stock that are registered under Section 12 of the
Exchange Act, (i) all outstanding options shall immediately become exercisable
in full, (ii) the restrictions applicable to any outstanding Restricted Stock
Award shall lapse and (iii) there shall be substituted for each share of Common
Stock available under this Plan, whether or not then subject to an outstanding
award, the number and class of shares into which each outstanding share of
Common Stock shall be converted pursuant to such Change in Control. In the event
of any such substitution, the purchase price per share in the case of an option
shall be appropriately adjusted by the Committee, such adjustments to be made
without an increase in the aggregate purchase price.
(3) Notwithstanding any provision in this Plan or any agreement, in the
event of a Change in Control (other than a Change in Control in connection with
which the holders of Common Stock receive consideration other than shares of
common stock that are registered under Section 12 of the Exchange Act), each
outstanding award shall be surrendered to the Company by the holder thereof, and
each such award shall immediately be canceled by the Company, and the holder
shall receive within ten days of the occurrence of such Change in Control, a
cash payment from the Company in an amount equal to (i) in the case of an
option, the number of shares of Common Stock then subject to such option,
multiplied by the excess, if any, of the greater of (A) the highest per share
price offered to stockholders of the Company in any transaction whereby the
Change in Control takes place or (B) the Fair Market Value of a share of Common
Stock on the date of occurrence of the Change in Control, over the purchase
price per share of Common Stock subject to the option and (ii) in the case of a
Restricted Stock Award, the number of shares of Common Stock then subject to
such aware, multiplied by the greater of (A) the highest per share price offered
to stockholders of the Company in any transaction whereby the Change in Control
takes place or (B) the Fair Market Value of a share of Common Stock on the date
of occurrence of the Change in Control. In the event of a Change in Control,
each stock appreciation right shall be surrendered by the holder thereof and
shall be canceled simultaneously with the cancellation of the related option.
The Company may, but is not required to, cooperate with any person who is
subject o Section 16 of the Exchange Act to assure that any cash payment in
accordance with the foregoing to such person is made in compliance with Section
16 and the rules and regulations thereunder.
A-2
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
IV. ELIGIBILITY
Any regular salaried employee of the Company or any of its subsidiary
companies shall be eligible to receive options, stock appreciation rights and
Restricted Stock Awards under the Plan. Members of the Board of Directors of the
Company who are not employed in any other capacity as regular salaried employees
of the Company or of any subsidiary are not eligible to receive options, stock
appreciation rights and Restricted Stock Awards under the Plan.
V. OFFERING TO DESIGNATED EMPLOYEES
Subject to the terms of the Plan, the Committee shall have the authority to
select the persons to whom options are to be granted under the Plan (it being
understood that more than one option may be granted to the same person), the
number of shares to be subject to each such option, the option price of such
shares, the time or times when each option may be exercised within the limits
stated in this Plan, and other terms of the option. An option, or a portion
thereof, may be an "incentive stock option" within the meaning of Section 422 of
the Code (an "ISO") or an option that is not an ISO (a "Non-Statutory Stock
Option"), provided that no ISO may be granted more than ten years after the date
on which the stockholders of the Company approve the amendment and no statement
of the Plan providing for the grant of ISOs hereunder. The Committee shall also
have the authority, subject to the terms of the Plan, to determine (i) whether
stock appreciation rights are to be granted in conjunction with an option and
(ii) which employees shall receive Restricted Stock Awards, the number of shares
to be subject to each such Award and the terms and conditions of such Awards.
Each option, stock appreciation right and Restricted Stock Award issued under
the Plan may in the discretion of the Committee be covered by an agreement
executed on behalf of the Company and the Grantee. Each such Agreement shall be
in form approved by the Committee and shall contain such restrictions, terms and
conditions as the Committee may require and as are not inconsistent with the
provisions of the Plan. Each option and stock appreciation right shall be deemed
to have been granted and shall take effect on the date that the Committee
approves the granting of the option or stock appreciation right, or the date the
Grantee enters the employ of the Company or a subsidiary, whichever is later,
regardless of when the agreement or other document evidencing the option or
stock appreciation right is executed and delivered. Each such agreement or other
document shall be dated as of the date the option, stock appreciation right or
Restricted Stock Award evidenced thereby is granted.
VI. PRICE
The option price shall not be less than 100% of the fair market value of the
Stock at the time the option is granted; provided, however, that if an ISO shall
be granted to any person who, at the time such ISO is granted, who owns capital
stock possessing more than ten percent of the total combined voting power of all
classes of capital stock of the Company (or of any parent or subsidiary) (a "Ten
Percent Holder"), the purchase price per share of Common Stock shall be the
price (currently 110% of Fair Market Value) required by the Code in order to
constitute an ISO. The fair market value at the time the option is granted
shall, for purposes of the Plan, be the mean between the highest and lowest
prices at which the Stock is traded on the day on which the option is granted,
as reflected on the consolidated tape of New York Stock Exchange issues, or if
such date is not a trading day, on the first trading day preceding such date. If
there are no such sales of Stock on the date the option is granted (or on the
first trading day preceding such date, if applicable) the mean between the bid
and the asked prices as reflected on the consolidated tape of New York Stock
Exchange issues at the close of the market on such day shall be deemed to be the
fair market value of the Stock.
VII. EXERCISE OF OPTIONS
(a) The period during which an option may be exercised shall be determined
by the Committee at the time the option is granted, except (but subject to
Section 3) that
(i) an employee must continue in the employ of the Company and/or one
or more of its subsidiaries for a period of not less than one year after the
date of grant of the option before he may exercise such option;
A-3
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
VII. EXERCISE OF OPTIONS (CONTINUED)
(ii) not more than 50% of the total number of shares subject to his
option may be purchased by an employee during the one-year period beginning
on the first anniversary of the date of grant of the option;
(iii) except as otherwise provided in Section 11, no option shall be
exercisable after the Grantee ceases to be an employee of the Company; and
(iv) no option shall be exercisable more than ten years after its date
of grant, PROVIDED, that if an ISO shall be granted to a Ten Percent Holder,
such ISO shall not be exercisable more than five years after its date of
grant.
For purposes of the foregoing and Section 11, any Grantee who shall retire
from employment with the Company and/or one or more of its subsidiaries prior to
the first of the month following his 65th birthday, and who at the time of such
retirement shall be committed to render consulting services to the Company
and/or one or more of its subsidiaries pursuant to a contract which is approved
by the Board of Directors and which in the judgment of the Committee requires
that during the period of such contract he be obligated to devote a substantial
portion of his time to rendering such services, shall, if the Committee so
determines, be deemed for purposes of the Plan to continue in the employment of
the Company and/or its subsidiaries so long as his obligation to render
consulting services under such contract shall continue in effect, but not beyond
three years from the date of his retirement or ten years from the date of grant
whichever shall first occur.
Subject to the foregoing and Section 11, options may be exercised from time
to time in whole or in part. Each exercise of an option shall be accomplished by
giving written notice of such exercise to the Treasurer of the Company,
specifying the number of shares to be purchased and accompanied by payment in
full of the purchase price therefor (or arrangement made for such payment to the
satisfaction of the Company). An employee to whom an option is granted shall be
under no obligation whatsoever to exercise it, and he may exercise the option or
not in his discretion.
(b) Payment for the options exercised shall be either in (i) cash, or check,
bank draft or money order (collectively referred to as "cash") to the order of
IMC Global Inc. for an amount in United States dollars equal to the total option
price for the number of shares upon which options are being exercised, or (ii)
shares of Common Stock of the Company (which shall be valued, for this purpose,
at a price per share which is the mean between the highest and lowest prices at
which the Stock is traded on the exercise date (or, if such date is not a
trading day, on the first trading day preceding the exercise date), as reflected
on the consolidated tape of New York Stock Exchange issues, or if there are no
such sales of Stock on the exercise date (or on the first trading day preceding
such date, if applicable), the mean between the bid and the asked prices as
reflected on the consolidated tape of New York Stock Exchange issues at the
close of the market on such date) with a value equal to or less than the total
option price, plus cash for an amount in United States dollars equal to the
amount, if any, by which the total option price exceeds the value (determined as
aforesaid) of such shares of Company stock. Payment of the option exercise price
in cash may be made by a broker-dealer acceptable to the Company to whom the
optionee has submitted an irrevocable notice of exercise. Payment of the option
exercise price by shares of Common Stock shall be either (A) by delivery of
previously owned whole shares of Common Stock (which the optionee has held for
at least six months prior to delivery of such shares and for which the optionee
has good title, free and clear of all liens), (B) by authorizing the Company to
withhold whole shares of Common Stock which would otherwise be delivered upon
exercise of the option of (C) a combination of (A) and (B), in each case to the
extent set forth in the agreement relating to the option. The Committee shall
have sole discretion to disapprove of an election pursuant to any of clauses
(A)-(C) and in the case of an optionee who is subject to Section 16 of the
Exchange Act, the Company may require that the method of making such payment be
in compliance with Section 16 and the rules and regulations thereunder. The
exercise date as used herein shall mean the business day on which an optionee
delivers written notice to the Treasurer of the Company specifying the number of
shares the optionee then desires to purchase under options held by such
optionee.
A-4
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
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VII. EXERCISE OF OPTIONS (CONTINUED)
Payment for shares exercised for Stock and/or cash shall be delivered to the
Treasurer of the Company not later than the end of the third business day after
the exercise date. In the case of payment by delivery of previously owned shares
of Stock, such payment shall be made by delivery of the necessary share
certificates, with executed stock powers attached, to the Treasurer of the
Company or, if such certificates have not yet been delivered to the optionee by
written notice to the Treasurer of the Company requesting that the shares
represented by such certificates be applied toward payment as hereinabove
provided.
(c) At the request of a participant, the Company may satisfy any of its tax
withholding obligations arising upon the exercise of an option under Federal,
State or other tax laws by withholding from the number of shares to be delivered
to the Grantee that number of shares equal to the amount of such tax to be
withheld. Shares to be withheld under this Section 7(c) shall be valued in
accordance with the provisions of Section 7(b) (ii) above. In the alternative,
the Grantee may deliver to the Company in whole or partial satisfaction of the
Company's tax withholding requirements, previously owned whole shares of Common
Stock (which the optionee has held for at least six months prior to delivery of
such shares and for which the optionee has good title, free and clear of all
liens), which shares shall be valued for such purpose in accordance with the
provisions of Section 7(b) (ii) above. The Committee shall have sole discretion
to disapprove of an election or request to withhold or deliver shares of Stock
in order to satisfy tax withholding obligations and in the case of an optionee
who is subject to Section 16 of the Exchange Act, the Company may require that
the method of satisfying such obligations be in compliance with Section 16 and
the rules and regulations thereunder.
VIII. STOCK APPRECIATION RIGHTS
(a) Stock appreciation rights may be granted in conjunction with all or part
of any option granted under this Plan, either at the time of the grant of such
option or at any subsequent time during the term of the option; provided,
however, that any stock appreciation right related to an ISO shall be granted at
the same time that such ISO is granted. A "stock appreciation right" is a right
to receive, without payment to the Company, a number of shares of Common Stock
of the Company and/or cash, as provided in this Section 8, in lieu of the
purchase of shares under a related option. A stock appreciation right shall
terminate and no longer be exercisable upon the termination of the related
option. Stock appreciation rights may be exercised, in accordance with
subsection (b) of this Section 8, by a Grantee by surrendering the related
option or applicable portion thereof. Upon such exercise and surrender, the
Grantee shall be entitled to receive an amount determined in the manner
prescribed in subsection (b) of this Section 8. Options which have been so
surrendered, in whole or in part, shall no longer be exercisable to the extent
the related stock appreciation rights have been exercised.
(b) Stock appreciation rights shall be subject to such terms and conditions
not inconsistent with other provisions of the Plan as shall be determined from
time to time by the Committee, which shall include the following:
(1) Stock appreciation rights shall be exercisable at such time or times
and only to the extent that the option to which they relate shall be
exercisable in accordance with the provisions of Section 7 and this Section
8 of this Plan.
(2) Upon the exercise of a stock appreciation right, an optionee shall
be entitled to receive an amount equal to the excess of the fair market
value of one share of Common Stock over the option price per share specified
in the related option multiplied by the number of shares in respect of which
the stock appreciation right shall have been exercised. If shares of Common
Stock are to be delivered for such excess amount, the number of whole shares
shall be determined by dividing such excess amount by the fair market value
of one share of Common Stock on the date of exercise of the stock
appreciation right. No fractional shares shall be issued upon exercise of
the stock
A-5
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
VIII. STOCK APPRECIATION RIGHTS (CONTINUED)
appreciation right and no cash shall be paid for such fractional shares. The
fair market value of Common Stock on the date of exercise of stock
appreciation rights shall be determined in the same manner as the fair
market value of Common Stock on the date of grant of an option is determined
pursuant to Section 6 hereof.
(3) The Committee shall have the sole discretion to determine the form
in which payment of the amount described in paragraph (2) of this subsection
(b) will made (i.e., cash, Common Stock, or any combination thereof).
(4) The obligation to make payments with respect to stock appreciation
rights shall not be funded or secured in any manner.
(c) Upon the exercise of a stock appreciation right, the option or part
thereof to which such stock appreciation right is related shall be deemed to
have been exercised for the purpose of the limitation of the number of shares of
Common Stock to be issued under the Plan as set forth in Section 3 hereof.
IX. RESTRICTED STOCK AWARDS
(a) Restricted Stock Awards are awards of restricted shares of Common Stock
which are subject to the terms, conditions and restrictions contained in this
Plan and in the Award relating to such shares. Upon the grant of any Restricted
Stock Award, the awarded shares shall be registered in the name of the Grantee
as soon as reasonably practicable after the award is made, but not until the
Grantee has executed an award agreement and any other documents which the
Committee in its absolute discretion may require. The awarded shares shall be
retained by the Treasurer of the Company, an escrow holder, and the Grantee
shall not be required to make any payment of cash consideration for such Award.
All such Awards shall be contingent and the rights of the Grantee with respect
thereto prior to vesting or forfeiture as provided in this Plan shall be only as
set forth in this Plan.
(b) Unless and until the shares awarded to a Grantee shall have vested as
provided in this Section 9, but subject to the provisions of Section 3 where
applicable, such shares shall not be sold, transferred or otherwise disposed of
or pledged, but the Grantee, after delivery of the shares to the escrow holder,
shall have the right to vote the shares and receive all dividends and other
distributions paid or made with respect thereto.
(c) Each Restricted Stock Award shall be granted by the Committee, in its
absolute discretion, subject to the provisions of the Plan, and shall contain
such terms and conditions as the Committee shall determine consistent with the
Plan, but in no event (except as provided in Section 3 hereto) may any portion
of a Restricted Stock Award vest prior to one year after the date of grant.
(d) Upon the forfeiture of any share of Restricted Stock in accordance with
the provisions of the Plan, or the terms and conditions of the Award, such share
shall automatically be transferred to and reacquired by the Company at no cost
to the Company.
(e) Vested Restricted Stock Awards shall be paid by delivery to the Grantee
of certificates for the appropriate number of shares of Common Stock of the
Company, registered in his name, free of any restriction or condition other than
such restrictions on the resale of such Stock as the Committee, on advice of
counsel, may require, which restrictions may be expressed, at the option of the
Committee, in a legend on the stock certificate, with appropriate instructions
given to the Company's transfer stock agent.
X. NECESSARY APPROVALS
Each option and stock appreciation right and Restricted Stock Award shall be
subject to the requirement that if at any time the Board of Directors shall
determine, in its discretion, that the listing, registration or qualification of
the shares subject to such option or stock appreciation right or Restricted
Stock Award upon any securities exchange or
A-6
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
X. NECESSARY APPROVALS (CONTINUED)
under any state or federal law, or that the consent or approval of any
governmental authority, is necessary or desirable as a condition of, or in
connection with, the issuance or purchase of shares under such option or upon
exercise of such stock appreciation right or the award, vesting or delivery of
shares covered by a Restricted Stock Award, such option or stock appreciation
right may not be exercised in whole or in part, and such Restricted Stock Award
shall not be made or vest, and shares thereunder may not be delivered, as the
case may be, unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Board of Directors. Any option or stock appreciation right may
be exercised only in accordance with the provisions of all applicable law.
XI. TERMINATION OF EMPLOYMENT
(a) If an employee ceases to be employed for any reason, whether by his own
volition or otherwise, except where termination is due to death, total
disability or retirement (as defined in Section 11(c) of this Plan) of the
employee, all options and stock appreciation rights held by the employee under
this Plan shall be automatically canceled at the time of termination of
employment except that any such option and stock appreciation right may be
exercised by him within three months after such termination (but not after the
expiration of ten years from the date of grant or after the expiration of any
other period for exercise made applicable by the Committee at the time of grant)
to the extent exercisable by him at the time of such termination; provided,
however, that in the case of an ISO, the period of time after such termination
of employment shall not be greater than three months. If such an employee dies
within such three month period, any such right of exercise of his option or
stock appreciation right, respectively, possessed by him on the date of his
death shall be transferred and may be exercised as provided in subsection (b) of
this Section, unless the option or stock appreciation right by its terms shall
provide otherwise.
(b) If an employee dies while in the employ of the Company or any of its
subsidiary companies, any option and stock appreciation right held by him at the
time of his death shall be transferred as provided in his will or as determined
by the laws of descent and distribution, and may be exercised, to the extent
exercisable by him at the time or from time to time within twelve months after
the date of death (but not after the expiration of ten years from the date of
grant or after the expiration of any other period for exercise made applicable
by the Committee at the time of grant) unless the option or stock appreciation
right by its terms shall provide a shorter period of time during which the
option or stock appreciation right may be exercised after death.
(c) An employee whose employment terminates because of total disability or
retirement (as defined in this subsection) may exercise his option and stock
appreciation right, to the extent exercisable by him at the time of such
termination, at any time or from time to time within three years after the
termination of his employment (but not after the expiration of ten years from
the date of grant or after the expiration of any other period for exercise made
applicable by the Committee at the time of grant). If such a former employee
dies, any such right of exercise of his option or stock appreciation right
possessed by him on the date of his death shall be transferred and may be
exercised as provided in subsection (b) of this Section unless the option or
stock appreciation right by its terms shall provide otherwise. "Retirement", for
purposes of this Plan, shall include termination of employment at a time when
the Grantee is entitled to a pension under any retirement plan of the Company.
(d) If the employment of a Grantee terminates before a Restricted Stock
Award is vested in accordance with the Plan, he shall automatically forfeit all
shares of Stock then subject to Restricted Stock Awards under the Plan, except
to the extent otherwise determined by the Committee in its sole discretion
before or after such termination.
XII. MISCELLANEOUS
(a) While an option or stock appreciation right is unexercised, an employee
shall have no voting rights or other rights of stockholders with respect to
shares which are subject to his option or which he may receive upon exercise of
his
A-7
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
XII. MISCELLANEOUS (CONTINUED)
stock appreciation right. Furthermore, no cash dividends shall accrue or be
payable with respect to any such shares. However, an employee shall have full
voting and other rights upon the date on which the Committee determines that
Stock will be issued to him in connection with the exercise of the stock
appreciation right.
(b) Stock which is subject to options but has not yet been purchased or
which may be issued upon exercise of a stock appreciation right has no
subscription rights.
(c) No fractional shares of Stock shall be issued upon exercise of an option
or a stock appreciation right and in case a fractional share shall become
subject to an option or stock appreciation right by reason of a stock dividend
or otherwise, the employee holding such option or stock appreciation right shall
not be entitled to exercise it with respect to such fractional share.
(d) The rights granted to any employee pursuant hereto shall be exercisable,
during his lifetime, only by him or by his guardian or legal representative and
none of such rights shall be subject to sale, hypothecation, assignment or
pledge or be transferable otherwise than by will or intestacy.
(e) No Grantee of an option, stock appreciation right or Restricted Stock
Award shall have any right to be retained in the employ of the Company or a
subsidiary thereof by virtue of his participation in the Plan.
(f) This Plan, each option, stock appreciation right and Restricted Stock
Award hereunder and the related agreement, and all determination made and
actions taken pursuant thereto, to the extent not otherwise governed by the Code
or the laws of the United States, shall be governed by the laws of the State of
Delaware and construed in accordance therewith without giving effect to
principles of conflicts of laws.
XIII. AMENDMENTS
Subject to any requirement of stockholder approval required by applicable
law, rule or regulation including Rule 16b-3 under the Exchange Act and Section
162(m) of the Code, the Board of Directors shall have the power (i) to make such
changes in the Plan and in any option, stock appreciation right or Restricted
Stock Award previously granted under the Plan as in the opinion of counsel to
the Company may be necessary or appropriate from time to time so that options
granted under the Plan will continue to be ISOs or Non-Statutory Stock Options,
as the case may be, under the Code as in existence from time to time, and (ii)
to make such other changes in the Plan and in any option or stock appreciation
right previously granted under the Plan as from time to time the Board deems
proper and in the best interests of the Company provided, however, that no
amendment shall be made without stockholder approval if such amendment would (a)
increase the maximum number of shares of Common Stock available under this Plan
(subject to Section 3), (b) reduce the minimum purchase price in the case of an
option or the base price in the case of a stock appreciation right, (c) effect
any change inconsistent with Section 422 of the Code or (d) extend the term of
this Plan. No amendment may impair the rights of a holder of an outstanding
award without the consent of such holder.
XIV. EFFECTIVE DATE AND TERMINATION
(a) The Plan or any amendment hereto shall become operative and in effect as
of the date the Plan or any such amendment is approved by the affirmative vote
of a majority of the shares of Common Stock present in person or represented by
proxy at the 1995 annual meeting of stockholders.
A-8
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
(b) The Plan shall remain in effect until termination by action of the
Board. Termination of this Plan shall not affect the rights of employees under
the options theretofore granted to purchase Common Stock under the Plan, or the
rights of employees pursuant to stock appreciation rights and Restricted Stock
Awards theretofore granted under the Plan, and all such options, stock
appreciation rights and Restricted Stock Awards shall continue in force and in
operation after termination of the Plan, except as they may be terminated
through death or other termination of employment in accordance with the terms of
the Plan.
XV. DEFINITIONS OF CERTAIN TERMS REFERENCED HERETO IN THE PLAN
(a) Change in Control: The term "Change in Control" of the Company when used
in this Plan, shall mean, and be deemed to have occurred as of the first day
that any one or more of the following conditions have been satisfied.
(1) the acquisition by any individual, entity or group (a "Person"),
including any "person" within the meaning of Section 13(d)(3) or 14(d)(2) of
the Exchange Act, of beneficial ownership within the meaning of Rule 13d-3
promulgated under the Exchange Act, of 15% or more of either (i) the then
outstanding shares of common stock of the Company (the "Outstanding Company
Common Stock") or (ii) the combined voting power of the then outstanding
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); excluding, however,
the following: (A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of an exercise, conversion or
exchange priviledge unless the security being so exercised, converted or
exchanged was acquired directly from the Company; (B) any acquisition by the
Company, (C) any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the
Company of (D) any acquisition by any corporation pursuant to a transaction
which complies with clauses (i), (ii) and (iii) of subsection (3) of this
definition;
(2) individuals who, as of the date hereof, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to constitute at
least a majority of such Board; provided that any individual who becomes a
director of the Company subsequent to the date hereof whose election, or
nomination for election by the Company's stockholders, was approved by the
vote of at least a majority of the directors then comprising the Incumbent
Board shall be deemed a member of the Incumbent Board; and provided further,
that any individual who was initially elected as a director of the Comapny
as a result of an actual or threatened election contest, as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, or
any other actual or threatened solicitation of proxies or consents by or on
behalf of any Person other than the Board shall not be deemed a member of
the Incumbent Board;
(3) approval by the stockholders of the Company of a reorganization,
merger or consolidation or sale or other disposition of all or substantially
all of the assets of the Company (a "Corporate Transaction"); excluding,
however, a Corporate Transaction pursuant to which (i) all or substantially
all of the individuals or entities who are the beneficial owners,
respectively, of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities immediately prior to such Corporate Transaction
will beneficially own, directly or indireclty, more than 60% of,
respectively, the outstanding shares of common stock, and the combined
voting power of the outstanding securities of such corporation entitled to
vote generally in the election of directors, as the case may be, of the
corporation resulting from such Corporate Transaction (including, without
limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly
or indirectly) in substantially the same proportions relative to each other
as their ownership, immediately prior to such Corporate Transaction, of the
Outstanding Company Common Stock and the Outstanding Company Voting
Securities, as the case may be, (ii) no Person (other than: the Company; the
corporation resulting from such
A-9
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
XV. DEFINITIONS OF CERTAIN TERMS REFERENCED HERETO IN THE PLAN (CONTINUED)
Corporation Transaction; and any Person which beneficially owned,
immediately prior to such Corporate Transaction, directly or indirectly, 25%
or more of the Outstanding Company Common Stock of the corporation resulting
from such Corporate Transaction or the combined voting power of the
outstanding securities of such corporation entitled to vote generally in the
election of directors and (iii) individuals who were members of the
Incumbent Board will constitute at least a majority of the members of the
board of directors of the corporation resulting from such Corporate
Transaction; or
(4) approval by the stockholders of the Company of a plan of complete
liquidation or dissolution of the Company.
"NON-STATUTORY STOCK OPTION" shall mean a stock option which is not an ISO.
"PERMANENT AND TOTAL DISABILITY" shall have the meaning set forth in Section
22(e)(3) of the Code or any successor thereto.
"TERMINATION OF EMPLOYMENT" shall mean the termination of employment by IMC
Global Inc. or the Company or its successor company of an employee who is a
participant in the Plan, that occurs after a Change in Control (as herein
defined) has occurred and is not due to cause and is not voluntary. Termination
shall not be deemed to be voluntary if the employee elects to resign because his
or her position, responsibility, benefits, or compensation have been adversely
changed or diminished.
This definition is applicable to TERMINATION OF EMPLOYMENT when used in the
Plan only when the reference to Section 16 appears along with it.
A-10
EXHIBIT A
IMC GLOBAL INC.
1988 STOCK OPTION AND AWARD PLAN
AS AMENDED AND RESTATED EFFECTIVE AUGUST 17, 1995
(CONTINUED)
----------------------------------------------------------------------------
XV. DEFINITIONS OF CERTAIN TERMS REFERENCED HERETO IN THE PLAN (CONTINUED)
IN WITNESS WHEREOF, IMC Global Inc. Inc. has caused this instrument as
amended to be executed, effective as of August , 1995.
IMC GLOBAL INC.
By
--------------------------------------
Its
(corporate seal)
ATTEST:
By
--------------------------------------
Its
A-11
DIRECTIONS TO
OMNI ORRINGTON HOTEL
FROM O'HARE INTERNATIONAL AIRPORT
From Arrivals Terminal, follow signs "To Chicago." Exit at I-294 NORTH.
(There will be a 40 CENTS toll.) Exit at Dempster Street-EAST. Continue east
on Dempster approximately 15-20 minutes into Evanston. Proceed under two
viaducts and turn left on to Sherman Avenue immediately to downtown Evanston.
Four blocks until split, bear right on to Orrington Avenue. 1 1/2 blocks to
Omni Orrington Hotel on left.
FROM CHICAGO AND SOUTH
North on Lake Shore Drive to it's end at Hollywood. Right on to Sheridan
Road. Continue north into Evanston. (There are many turns, watch for Sheridan
Road signs.) Left on Dempster Street to Chicago Avenue. Right on Chicago;
four blocks to Davis Street. Left on Davis. One block to Orrington Avenue.
Right on Orrington. 1 1/2 blocks to Omni Orrington Hotel on left.
FROM MILWAUKEE AND NORTH
I-94 East to Old Orchard Road exit-EAST. East through four stop lights to
Skokie Boulevard. Right on Skokie (Old Orchard Mall is on right) to Golf Road
(next major intersection). Left on Golf; continue 5-7 minutes into Evanston
(street changes name to Emerson.) to Sherman Avenue. Right on Sherman. Three
blocks to Church Street. Left on Church. Quick left on Orrington Avenue. Stay
left to Omni Orrington Hotel.
VIA PUBLIC TRANSPORTATION
CTA: Elevated rapid transit train (the "EL") Purple line to Davis Street.
Three blocks east to Omni Orrington Hotel.
Note: The "Evanston Express" Purple line runs from the Chicago Loop during
weekdays at rush hours. At non-rush hour times, take the Red line north to
Howard Street. Transfer to the Purple line (same platform).
METRA COMMUTER RAILROAD: North Line from Northwestern Station to Davis
Street. 3 1/2 blocks east to Omni Orrington Hotel.
Note: If arriving in Chicago via Amtrak. Disembark at Union Station. Exit
Union Station and cross street to Northwestern Station.
AIRPORT EXPRESS (800) 654-7871
Shared van service departs O'Hare every 20 minutes between 6:00am and
11:00pm. See ticket agents at baggage claim areas 1E, 2D, and 3E. Cost is
approximately $15.00 per person.
TAXI
Call the following taxi cab companies for a flat rate from the airports:
Better Cab (708)328-2515
Magic Cab (708)866-6400
Northshore Cab: (708)864-7500
Three-O-Three Cab: (708)256-0303
PARKING IS AVAILABLE AT THE HOTEL.
1710 ORRINGTON AVENUE, EVANSTON, IL 60201-3855 (708) 866-8700 FAX: (708)
866-8724
Please mark your
/ X / votes as in this
example.
This proxy when properly executed will be voted in the manner directed herein.
If no direction is made, this proxy will be voted FOR proposals 1, 2, 3, and 4.
The Board of Directors recommends a vote FOR proposals 1, 2, 3, and 4.
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of 2. Ratifying Amendments to 1988 Stock
five Option and Award Plan
Directors / / / / / / / / / /
For, except vote withheld from the
following nominee(s): 3. Increased authorized Shares to
100 million / / / / / /
___________________________________
4. Ratification of Independent Auditors
/ / / / / /
Please check this box if you plan to
attend the Annual Meeting. / /
SIGNATURE(s)_______________________ DATE ________ The signer hereby revokes all proxies heretofore given by the signer to
vote at said meeting or any adjournments thereof.
NOTE: Please sign exactly as name appears hereon. Joint owners should each
sign. When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
PRELIMINARY COPY
IMC GLOBAL INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY FOR ANNUAL MEETING, OCTOBER 19, 1995
P The undersigned hereby constitutes and appoints Wendell F. Bueche, James D.
Speir and Marschall I. Smith and each of them, with full power of
R substitution, proxies to represent the undersigned at the Annual Meeting of
Stockholders of IMC Global Inc. to be held at Omni Orrington Hotel, 1710
O Orrington Avenue, Evanston, Illinois 60201-3855 on Thursday, October 19,
1995, at 11:00 a.m. Local Time, and at any adjournments thereof, and to
X vote on all matters coming before said meeting, hereby revoking any proxy
heretofore given.
Y
Comments: (Such as change of Address)
Election of Directors Nominees (see reverse side)
------------------------------------------
One Year Three Years
Frank W. Considine Wendell F. Bueche ------------------------------------------
Richard A. Lenon James M. Davidson
David B. Mathis ------------------------------------------
You are encouraged to specify your choices by marking the appropriate boxes,
SEE REVERSE SIDE, but you need not mark any boxes if you wish to vote in
accordance with the Board of Directors recommendations as noted in the proxy
statement and on the reverse side. The Proxy Committee cannot vote your
shares unless you sign and return this card.
------------
SEE REVERSE
SIDE
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