Section 240.14a-101 Schedule 14A.
Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
MINERALS TECHNOLOGIES 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] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction
applies:
............................................................
(2) Aggregate number of securities to which transaction
applies:
.......................................................
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the amount
on which the filing fee is calculated and state how it was
determined):
.......................................................
(4) Proposed maximum aggregate value of transaction:
.......................................................
(5) Total fee paid:
.......................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
.......................................................
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.......................................................
(4) Date Filed:
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Minerals Technologies Inc.
The Chrysler Building
405 Lexington Avenue
New York, NY 10174-1901
--------------------------
PAUL R. SAUERACKER
Chairman, President and
Chief Executive Officer
[MINERALS TECH LOGO]
March 31, 2003
Dear Fellow Stockholder:
You are cordially invited to attend the 2003 Annual Meeting of Stockholders
of Minerals Technologies Inc., which will be held on Thursday, May 22, 2003, at
2:00 p.m., in the J. P. Morgan Chase & Co. Building, 11th floor, Room C, 270
Park Avenue (between 47th and 48th Streets), New York, New York 10017.
At this year's meeting, you will be asked to consider and to vote upon the
election of four directors, including myself. Your Board of Directors
unanimously recommends that you vote FOR the nominees.
You will also be asked to ratify the appointment of KPMG LLP as our
independent auditors for the 2003 fiscal year. The Board continues to be pleased
with the services KPMG LLP has rendered to Minerals Technologies, and
unanimously recommends that you vote FOR this proposal.
The two items upon which you will be asked to vote are discussed more fully
in the Proxy Statement. I urge you to read the Proxy Statement completely and
carefully so that you can vote your interests on an informed basis.
Your vote is important! Whether or not you plan to attend the meeting, and
regardless of the number of shares you own, your representation and vote are
very important and you should vote your shares. Therefore, I urge you to
complete, sign, date and return the enclosed proxy card promptly in the
accompanying postage prepaid envelope. All shareholders of record, and many
street name holders, may also vote by internet, or by touchtone telephone from
the United States and Canada, using the instructions on the proxy card. If you
return a signed proxy without marking it, it will be voted in accordance with
management's recommendations. You may, of course, attend the Annual Meeting and
vote in person, even if you have previously submitted a proxy.
Sincerely,
Paul R. Saueracker
Paul R. Saueracker
Chairman, President and
Chief Executive Officer
This Proxy Statement is printed on paper containing precipitated calcium
carbonate (PCC) produced by Minerals Technologies Inc.
MINERALS TECHNOLOGIES INC.
THE CHRYSLER BUILDING
405 LEXINGTON AVENUE
NEW YORK, NEW YORK 10174-1901
---------------------------
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
---------------------------
MAY 22, 2003
The Annual Meeting of Stockholders of MINERALS TECHNOLOGIES INC., a Delaware
corporation, will be held on Thursday, May 22, 2003, at 2:00 p.m., in the J. P.
Morgan Chase & Co. Building, 11th Floor, Room C, 270 Park Avenue (between 47th
and 48th Streets), New York, New York 10017, to consider and take action on the
following items:
(1) the election of four directors;
(2) a proposal to ratify the appointment of KPMG LLP as independent
auditors of Minerals Technologies for the 2003 fiscal year; and
(3) any other business that properly comes before the meeting, either at
the scheduled time or after any adjournment.
Stockholders of record as of the close of business on March 24, 2003, are
entitled to notice of and to vote at the meeting.
By order of the Board of Directors,
S. Garrett Gray
S. Garrett Gray
Secretary
New York, New York
March 31, 2003
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND IN PERSON, PLEASE VOTE BY COMPLETING AND
MAILING THE ENCLOSED PROXY. WE ASK YOU TO MARK YOUR CHOICES, SIGN, DATE AND
RETURN THE PROXY AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE PREPAID ENVELOPE.
ALTERNATIVELY, ALL SHAREHOLDERS OF RECORD, AND MANY STREET NAME HOLDERS, CAN
VOTE BY INTERNET, OR BY TOUCHTONE TELEPHONE FROM THE UNITED STATES AND CANADA,
USING THE INSTRUCTIONS ON THE PROXY CARD. IF YOU RETURN A SIGNED PROXY WITHOUT
MARKING IT, IT WILL BE VOTED IN ACCORDANCE WITH MANAGEMENT'S RECOMMENDATIONS. BY
PROMPTLY SUBMITTING A PROXY, YOU WILL AID US IN REDUCING THE EXPENSE OF
ADDITIONAL PROXY SOLICITATION.
MINERALS TECHNOLOGIES INC.
THE CHRYSLER BUILDING
405 LEXINGTON AVENUE
NEW YORK, NEW YORK 10174-1901
MARCH 31, 2003
---------------------------
PROXY STATEMENT
---------------------------
Minerals Technologies Inc. is sending this Proxy Statement and form of proxy
to its stockholders on or about March 31, 2003 in connection with its Annual
Meeting of Stockholders. The Annual Meeting will be held on Thursday, May 22,
2003, at 2:00 p.m., in the J. P. Morgan Chase & Co. Building, 11th Floor,
Room C, 270 Park Avenue (between 47th and 48th Streets), New York, New York
10017. The Board of Directors asks you to submit a proxy for your shares so that
even if you do not attend the meeting, your shares will be counted as present at
the meeting and voted as you direct.
At the Annual Meeting, stockholders will vote on two questions: the election
of directors, and ratification of the appointment of auditors. The Board
unanimously recommends that you vote FOR each of the nominees for director,
Kristina M. Johnson, Michael F. Pasquale, John T. Reid and Paul R. Saueracker,
and FOR ratification of the appointment of KPMG LLP to continue as our auditors.
Holders of record of common stock of Minerals Technologies at the close of
business on the Record Date, March 24, 2003, are entitled to vote at the
meeting. As of January 31, 2003, T. Rowe Price Associates, Inc. owned 8.0%,
Reich & Tang Asset Management LLC owned 5.6%, State Street Bank and Trust
Company owned 5.5%, and Wellington Management Company, LLP owned 5.3%, of our
common stock. No other person owned of record, or, to our knowledge, owned
beneficially, more than 5% of our common stock.
If you submit a proxy, you can revoke it at any time before it is voted by
submitting a written revocation or a new proxy, or by voting in person at the
Annual Meeting.
ITEM 1 -- ELECTION OF DIRECTORS
The Board of Directors is divided into three classes. One class is elected
each year for a three-year term. This year the Board has nominated Kristina M.
Johnson, Michael F. Pasquale, John T. Reid and Paul R. Saueracker, who are now
directors of Minerals Technologies, to serve for a three-year term expiring at
the Annual Meeting of Stockholders to be held in 2006.
The Board expects that the nominees will be available for election. If one
or more nominees should become unavailable, your proxy would be voted for a
nominee or nominees who would be designated by the Board, unless the Board
reduces the number of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ELECTION OF EACH OF
KRISTINA M. JOHNSON, MICHAEL F. PASQUALE, JOHN T. REID AND PAUL R. SAUERACKER.
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION,
MAY 22, 2003 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS
- -------------------------- -----------------------------------------------------------
NOMINEES FOR DIRECTOR FOR TERMS EXPIRING IN 2006
Kristina M. Johnson........ 46 Dean of the Edmund T. Pratt, Jr. School of Engineering at
Duke University since 1999. Member of the Board from 1995
to 2002, and co-founder, of ColorLink Inc., a manufacturer
[Photo] of components for color projection television. Co-founder
of KAJ, LLC, a patent and intellectual property licensing
company. Director and a member of the Audit Committee of
Dycom Industries, Inc., a provider of specialty contracting
services to telecommunications providers, since
November 2001. Professor of Electrical and Computer
Engineering at the University of Colorado from 1985 to
1999. Director of Minerals Technologies Inc. since 2000.
Member of the Audit Committee of Minerals Technologies Inc.
Michael F. Pasquale........ 56 Business consultant since December 2000. Executive Vice
President and Chief Operating Officer of Hershey Foods
Corporation from February 2000 to December 2000. Prior to
[Photo] holding this position, Mr. Pasquale was Senior Vice
President, Confectionery and Grocery of Hershey from 1999
to February 2000, President of Hershey Chocolate North
America from 1995 to 1998, President of Hershey Chocolate
USA from 1994 to 1995, and Senior Vice President and Chief
Financial Officer of Hershey Foods Corporation from 1988 to
1994. Member of the Board of Trustees of the American
Management Association and the Board of Directors of Cold
Fusion Foods, Inc. Director of Minerals Technologies Inc.
since 1992. Chair of the Audit Committee of Minerals
Technologies Inc.
John T. Reid............... 63 Adjunct Professor, Stern Business School, New York
University since 2001. CEO of CityQuicker, a website
providing information for expatriate executives and their
[Photo] families, from 2000 to 2001. Chief Technology Officer of
Colgate-Palmolive Company, a global manufacturer of
consumer products, from 1997 to 2000. Member of the Board
of Directors, and of the Executive Committee and the Audit
Committee, of Center for Global Development since 2001.
Member of the Board of Directors of Citizens' Committee for
Children since 2002. Director of Minerals Technologies Inc.
since February 2003.
Paul R. Saueracker......... 61 Chairman of the Board of Minerals Technologies Inc. since
October 2001. Chief Executive Officer of Minerals
Technologies Inc. since December 31, 2000. President of
[Photo] Minerals Technologies Inc. since August 2000. Senior Vice
President from 1999 to 2000. Vice President from 1994 to
1999. President and Chief Executive Officer of Specialty
Minerals Inc. from 1994 to 2002. Member of the Board of
Trustees of the Institute of Paper Science and Technology,
Atlanta, Georgia. Member of the Board of Directors of the
National Association of Manufacturers. Director of Miner-
als Technologies Inc. since 2000. Chair of the Executive
Committee of Minerals Technologies Inc.
2
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION,
MAY 22, 2003 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS
- ------------------------- -----------------------------------------------------------
DIRECTORS WHOSE TERMS EXPIRE IN 2005
Duane R. Dunham............ 61 Retired in January 2002 as President and Chief Operating
Officer of Bethlehem Steel Corporation. Mr. Dunham served
as Chairman and Chief Executive Officer of Bethlehem Steel
[Photo] from April 2000 to September 2001. Prior to that time he
was President and Chief Operating Officer from 1999 to
April 2000 and President of the Sparrows Point division
from 1993 to 1999. Director of Bethlehem Steel Corporation
from 1999 to 2001. Director of Minerals Technologies Inc.
since October 2002. Member of the Audit Committee of
Minerals Technologies Inc.
Steven J. Golub............ 57 Managing Director since 1986 in the investment banking firm
of Lazard Freres & Co. LLC. Director of Minerals
Technologies Inc. since 1993. Member of the Audit Committee
[Photo] of Minerals Technologies Inc.
Jean-Paul Valles........... 66 Chairman of the Board of Minerals Technologies Inc. from
1989 to October 2001, and Chairman Emeritus of the Board
since October 2001. Chief Executive Officer of Minerals
[Photo] Technologies Inc. from 1992 to December 31, 2000. Member of
the Board of Directors of Pfizer Inc. Member of the Board
of Overseers of the Stern School of Business. Director of
Minerals Technologies Inc. since 1989. Member of the
Executive Committee of Minerals Technologies Inc.
3
NAME AND AGE AS OF THE POSITION, PRINCIPAL OCCUPATION,
MAY 22, 2003 MEETING DATE BUSINESS EXPERIENCE AND DIRECTORSHIPS
- ------------------------- -----------------------------------------------------------
DIRECTORS WHOSE TERMS EXPIRE IN 2004
John B. Curcio............. 68 Retired Chairman of the Board and Chief Executive Officer,
Mack Trucks, Inc. Vice Chairman and a Director of Harvard
Industries Inc., a manufacturer of automotive accessories,
[Photo] from 1985 to 1993. Member of the Boards of Directors of
Bethlehem Steel Corporation and Integrated Component
Systems, Inc., and Director and Vice Chairman of the Board
of Dallas Mavis Specialized Carrier Co. and of Jupiter
Logistics de Mexico, S.A. de C.V. Director of Minerals
Technologies Inc. since 1992. Chair of the Compensation and
Nominating Committee and a member of the Executive
Committee of Minerals Technologies Inc.
Paul M. Meister............ 50 Vice Chairman of the Board since 1998 of Fisher Scientific
International Inc., a provider of scientific products and
services. Senior Vice President and Chief Financial Officer
[Photo] of Fisher from 1994 to 1998. Member of the Boards of
Directors of The General Chemical Group, Inc., GenTek Inc.,
and M & F Worldwide Corp. Director of Minerals Technologies
Inc. since 1997. Member of the Compensation and Nominating
Committee of Minerals Technologies Inc.
William C. Steere, Jr. .... 66 Retired Chairman of the Board and Chief Executive Officer
of Pfizer Inc, an international health care company, and a
member of its Board of Directors since 1987. Member of the
[Photo] Boards of Directors of Dow Jones Inc. and Metropolitan Life
Insurance Company. Director of New York University Medical
Center, a Trustee of the New York Botanical Garden and a
member of the Board of Overseers of Memorial
Sloan-Kettering Cancer Center. Director of Minerals
Technologies Inc. since 1992. Member of the Executive
Committee and of the Compensation and Nominating Committee
of Minerals Technologies Inc.
4
BOARD OF DIRECTORS, COMMITTEES AND COMPENSATION
The Board of Directors met eight times in 2002. Each of the directors, with
the exception of Mr. Steere, attended 75 percent or more of the meetings of the
Board and committees on which he or she served in 2002.
THE COMPENSATION AND NOMINATING COMMITTEE
The Compensation and Nominating Committee consists of Mr. Curcio (Chair),
Mr. Meister and Mr. Steere, who are not employees of Minerals Technologies. The
Compensation and Nominating Committee met six times in 2002.
The Board of Directors has reviewed, assessed the adequacy of and approved a
formal written charter for the Compensation and Nominating Committee.
The primary functions of the Compensation and Nominating Committee are:
To participate in the development of our compensation and benefits policies;
To establish, and from time to time vary, the salaries and other compensation
of our employee-directors and other elected officers;
To participate in top-level management succession planning; and
To bring forward the names of suitable candidates for election to the Board.
THE AUDIT COMMITTEE
The Audit Committee consists of Mr. Pasquale (Chair), Mr. Dunham, Mr. Golub
and Dr. Johnson, who are not employees of Minerals Technologies. The Board of
Directors has determined that each of the members of the Audit Committee is
independent and financially literate in accordance with the rules of the New
York Stock Exchange, as well as being independent under the rules of the
Securities and Exchange Commission. The Board has also determined that
Mr. Pasquale, Chair of the Audit Committee, has 'financial expertise' for
purposes of the rules of the New York Stock Exchange.
The Audit Committee met eight times in 2002.
The Board of Directors has reviewed, assessed the adequacy of and approved a
formal written charter for the Audit Committee. The full text of the Charter of
the Audit Committee appears as Appendix 1 to this Proxy Statement.
The primary duties of the Audit Committee are:
To assist the Board in its oversight of (i) the integrity of the Company's
financial statements, (ii) the Company's compliance with legal and regulatory
requirements, (iii) the qualifications and independence of the Company's
independent auditor; and (iv) the performance of the Company's internal audit
function and independent auditor; and
To prepare the report of the Committee that the rules of the Securities and
Exchange Commission require be included in the Company's annual Proxy
Statement.
In addition to its regularly scheduled meetings, the Audit Committee is
available either as a group or individually to discuss any matters that might
affect the financial statements, internal controls or other financial aspects of
the operations of Minerals Technologies.
5
DIRECTOR COMPENSATION
Fees
Each of the directors, other than directors who are officers or employees of
Minerals Technologies, receives an annual retainer fee of $10,000 for serving as
a director, $1,000 for serving as a member of a committee of the Board, and an
additional $1,000 if serving as a committee chair. Non-employee directors also
receive a fee of $2,000 for each meeting of the Board they attend and $500 for
each committee meeting they attend. Directors also receive compensation under
the plans described below.
Nonfunded Deferred Compensation and Unit Award Plan for Non-Employee Directors
Under the Nonfunded Deferred Compensation and Unit Award Plan for
Non-Employee Directors, directors who are not employees of Minerals Technologies
have the right to defer their fees. At each director's election, his or her
deferred fees will be credited to his or her account either as dollars or as
units which have the economic value of one share of Minerals Technologies stock.
Dollar balances in a director's account bear interest at a rate of return equal
to the rate of return for the Fixed Income Fund in the Minerals Technologies
Inc. Savings and Investment Plan. If a director elects to have his or her
deferred fees credited to his or her account as units, the number of units
credited is calculated by dividing the amount of the deferred fees by the
closing price of our common stock as of the last business day prior to the date
on which the fees would otherwise be paid.
Each non-employee director is credited with 500 units upon first joining the
Board and with an additional 500 units each year as of the date of the Annual
Meeting of Stockholders, plus 65 units each year for serving as a member of a
committee of the Board and an additional 15 units for serving as chair of a
committee. In addition, each member receives 15 units for attending any
committee meeting and an additional 10 units for serving as chair of a committee
meeting.
The units in a director's account are increased by the value of any
dividends on our common stock. In the case of cash dividends, the units are
increased by a number calculated by multiplying the cash dividend per share
times the number of units in the director's account on the related dividend
record date and dividing the result by the closing market price of the common
stock on the day prior to the dividend payment date. In the case of stock
dividends, the units would be increased by a number calculated by multiplying
the stock dividend per share times the number of units in the director's account
on the related dividend record date.
At the time of the director's termination of service on the Board, the
amount held in his or her account is payable in cash only. Based on the
director's prior choice to accumulate dollars or units as described above, the
director receives either (i) the amount of his or her deferred fees plus accrued
interest, or (ii) an amount determined by multiplying the number of units in his
or her account by the closing market price of the common stock on the last
business day prior to the date of payment. Payments are made in a lump sum or in
installments, at the election of the director.
Stock Award and Incentive Plan
Directors are eligible under the Minerals Technologies Stock Award and
Incentive Plan to receive options to purchase common stock, at the same time and
on the same basis as across-the-board options are granted to Minerals
Technologies' U.S.-based employees.
6
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Steere, who is a director of Minerals Technologies, is a director and
former Chairman and Chief Executive Officer of Pfizer Inc. Dr. Valles, who is a
director and former Chairman and Chief Executive Officer of Minerals
Technologies, is a member of the Board of Directors of Pfizer Inc. During 2002,
Pfizer Inc. made a series of purchases of precipitated calcium carbonate from
Minerals Technologies totaling approximately $1.7 million. These transactions
were entered into by Minerals Technologies pursuant to arm's-length negotiations
in the ordinary course of business and on terms that we believe to be fair.
Mr. Golub, a director of Minerals Technologies, is Managing Director of
Lazard Freres & Co. LLC. Minerals Technologies has engaged Lazard Freres to
provide investment banking services from time to time with respect to a variety
of financial matters. In addition, Lazard Freres acts as our broker in
connection with our ongoing program of repurchases of a portion of our
outstanding common stock. To obtain this business, Lazard Freres, in an
arm's-length transaction, agreed to meet a competitive bid structured as a fixed
commission on each share repurchased.
7
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT AS OF JANUARY 31, 2003
AMOUNT AND
NATURE OF PERCENT NUMBER OF
TITLE OF NAME AND ADDRESS OF BENEFICIAL OF UNITS
CLASS BENEFICIAL OWNER(a) OWNERSHIP(b) CLASS OWNED(c)
----- ------------------- ------------ ----- --------
Common............................... T. Rowe Price Associates, Inc. 1,610,600(d) 8.0% --
100 E. Pratt Street
Baltimore, MD 21202
Reich & Tang Asset Management 1,132,000(e) 5.6% --
LLC
600 Fifth Avenue
New York, NY 10020
State Street Bank and Trust 1,113,028(f) 5.5% --
Company
225 Franklin Street
Boston, MA 02110
Wellington Management 1,061,900(g) 5.3%
Company, LLP
75 State Street
Boston, MA 02109
P. R. Saueracker 194,996(h) 1.0% 6,414
J. A. Sorel 49,434(i) * 1,679
H. R. Crabtree 67,503(j) * 2,587
S. G. Gray 83,482(k) * 1,462
K. L. Massimine 26,932(l) * 431
N. M. Bardach 5,442(m) * 786
A. Dulski 50,060(n) * 3,968
J. B. Curcio 2,133(o) * 4,711
D. R. Dunham -- * 500
S. J. Golub 3,294(p) * 8,870
K. M. Johnson 53(q) * 2,133
P. M. Meister 1,203(r) * 7,607
M. F. Pasquale 2,007(s) * 4,251
W. C. Steere, Jr. 1,610(t) * 10,809
J.-P. Valles 589,713(u) 2.9% 2,521
- ---------
(a) The address of each director and officer is c/o Minerals Technologies Inc.,
The Chrysler Building, 405 Lexington Avenue, New York, NY 10174-1901.
(b) Sole voting and investment power, except as otherwise indicated.
(c) 'Units,' which entitle the officer or director to a cash benefit equal to
the number of units in his or her account multiplied by the closing price
of our common stock on the business day prior to the date of payment, have
been credited to Messrs. Saueracker, Sorel, Crabtree, Gray and Massimine
under the Nonfunded Deferred Compensation and Supplemental Savings Plan;
and to Messrs. Curcio, Dunham, Golub, Meister, Pasquale, Steere, Dr.
Johnson and Dr. Valles under the Nonfunded Deferred Compensation and Unit
Award Plan for Non-Employee Directors (see 'Board of Directors, Committees
and Compensation -- Director Compensation' above).
(d) Based on a statement on Schedule 13G dated February 14, 2003 filed with the
Securities and Exchange Commission on behalf of T. Rowe Price Associates,
Inc., a registered investment adviser, with respect to beneficial ownership
interests as of such date. These securities are owned by various individual
and institutional investors which T. Rowe Price Associates, Inc. ('Price
Associates') serves as investment adviser with power to direct investments
and/or sole power to vote the securities. For purposes of the reporting
requirements of the Securities Exchange Act of 1934, Price
(footnotes continued on next page)
8
(footnotes continued from previous page)
Associates is deemed to be a beneficial owner of such securities; however,
Price Associates expressly disclaims that it is, in fact, the beneficial
owner of such securities.
(e) Based on a statement on Schedule 13G dated February 6, 2003 filed with the
Securities and Exchange Commission on behalf of Reich & Tang Asset
Management LLC, a registered investment adviser, with respect to beneficial
ownership interests as of such date.
(f) Based on a statement on Schedule 13G dated February 10, 2003 filed with the
Securities and Exchange Commission on behalf of State Street Bank and Trust
Company, a bank, with respect to beneficial ownership interests as of such
date.
(g) Based on a statement on Schedule 13G dated February 14, 2003, filed with
the Securities and Exchange Commission on behalf of Wellington Management
Company, LLP, a registered investment adviser and the parent holding
company of Wellington Trust Company, NA, a bank, with respect to beneficial
ownership interests as of December 31, 2002. The address of both the
foregoing entities is 75 State Street, Boston, MA 02109.
(h) 175,592 of these shares are subject to options which are exercisable
currently or within 60 days.
(i) 46,513 of these shares are subject to options which are exercisable
currently or within 60 days.
(j) 57,735 of these shares are subject to options which are exercisable
currently or within 60 days.
(k) 210 of these shares are held in the name of family members, and Mr. Gray
disclaims any beneficial interest in those shares. 67,552 of these shares
are subject to options which are exercisable currently or within 60 days.
(l) 25,115 of these shares are subject to options which are exercisable
currently or within 60 days.
(m) 4,677 of these shares are subject to options which are exercisable currently
or within 60 days.
(n) 45,443 of these shares are subject to options which are exercisable
currently or within 60 days.
(o) 233 of these shares are subject to options which are exercisable currently
or within 60 days.
(p) 194 of these shares are subject to options which are exercisable currently
or within 60 days.
(q) 53 of these shares are subject to options which are exercisable currently
or within 60 days.
(r) 203 of these shares are subject to options which are exercisable currently
or within 60 days.
(s) 207 of these shares are subject to options which are exercisable currently
or within 60 days.
(t) 210 of these shares are subject to options which are exercisable currently
or within 60 days.
(u) 99,900 of these shares are held by Dr. Valles and his wife as joint
tenants, and Dr. Valles has shared investment and voting power with respect
to those shares. 489,713 of these shares are subject to options which are
exercisable currently or within 60 days.
* Less than 1%.
As a group, our directors and officers (21 individuals) own 1,166,219 shares
of common stock (including 994,326 shares subject to options which are
exercisable currently or within 60 days), representing approximately 5.5% of the
common stock, and 60,058 units.
9
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
This table shows the cash and other compensation paid or accrued for
services to Minerals Technologies and its subsidiaries by the Chairman,
President and Chief Executive Officer; for the four other most highly
compensated executive officers who held such positions as of the end of 2002;
and for two additional individuals who were executive officers during 2002 (the
'named executive officers'), for the three fiscal years ended December 31, 2002.
LONG-TERM ALL OTHER
COMPENSATION COMPENSATION($)(a)
ANNUAL ------------------ ------------------
COMPENSATION SECURITIES
-------------------- UNDERLYING OPTIONS
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) (NUMBER OF SHARES)
- --------------------------- ---- --------- -------- ------------------
Paul R. Saueracker(b)............. 2002 546,154 200,063 1,649 32,040
Chairman, President 2001 495,766 253,125 20,000 23,094
and Chief Executive Officer 2000 318,121 81,569 50,000 17,930
John A. Sorel(c).................. 2002 262,692 77,115 684 14,535
Senior Vice President, Finance, 2001 234,569 99,652 10,000 9,583
Chief Financial Officer and
Treasurer
Howard R. Crabtree(d)............. 2002 273,077 56,018 902 14,333
Senior Vice President, 2001 248,120 84,375 10,000 12,637
Technology and Logistics 2000 236,586 66,381 0 13,928
S. Garrett Gray................... 2002 257,385 62,565 908 13,681
Vice President, General Counsel 2001 249,764 84,375 10,000 12,714
and Secretary 2000 243,255 68,080 0 14,285
Kenneth L. Massimine(e)........... 2002 236,923 71,784 581 12,983
Senior Vice President, 2001 198,039 86,280 10,000 8,137
Paper PCC
Neil M. Bardach(f)................ 2002 275,000 66,688 995 14,713
Vice President -- Finance and 2001 274,609 92,813 7,952 13,942
Chief Financial Officer 2000 264,159 73,930 0 15,512
Anton Dulski(g)................... 2002 398,846 116,400 1,328 22,212
Executive Vice President 2001 383,434 155,925 15,000 18,600
2000 296,695 81,569 35,000 17,320
- ---------
(a) The amounts shown in this column as part of 2002 compensation for Messrs.
Saueracker, Sorel, Crabtree, Gray, Massimine, Bardach and Dulski represent
amounts contributed on their behalf to the Savings and Investment Plan and
the Non-Funded Deferred Compensation and Supplemental Savings Plan.
(b) Mr. Saueracker became President of Minerals Technologies Inc. effective
August 24, 2000; Chief Executive Officer effective December 31, 2000; and
Chairman of the Board effective October 18, 2001.
(c) Mr. Sorel became Senior Vice President, Chief Financial Officer and
Treasurer effective November 20, 2002. Prior to that he had been Senior
Vice President, Corporate Development and Finance, since December 2001, and
Senior Vice President and Managing Director, PCC since January 2001.
(d) Mr. Crabtree became Senior Vice President, Technology and Logistics on
November 20, 2002. Prior to that he had been Senior Vice President, MINTEQ
since December 12, 2001, and Vice President -- Organization and Human
Resources since 1996.
(e) Mr. Massimine became Senior Vice President, Paper PCC on December 12, 2001.
Prior to that he had been Vice President and Managing Director, Processed
Minerals since 1999.
(footnotes continued on next page)
10
(footnotes continued from previous page)
(f) Mr. Bardach served as Vice President -- Finance, Chief Financial Officer
and Treasurer until December 1, 2002.
(g) Mr. Dulski became Executive Vice President of Minerals Technologies Inc.
effective August 24, 2000, and served as Chief Operating Officer from
October 26, 2000 to December 31, 2001.
OPTION GRANTS IN LAST FISCAL YEAR
This table provides information on options granted to the named executive
officers on January 24, 2002. The last two columns of the table show the
potential realizable value of the options in each of two hypothetical cases. The
first case assumes that the price of the stock increases at a rate of five per
cent per year over the term of the options, which would result in a price of
approximately $75.95 per share in 2012 and an increase in aggregate shareholder
value of approximately $592 million. The second case assumes that the price of
the stock increases at a rate of ten per cent per year over the term of the
options, which would result in a price of approximately $120.93 per share in
2012 and an increase in aggregate shareholder value of approximately $1,500
million. The actual market value of the stock at any future date may or may not
correspond to any of these hypothetical cases.
POTENTIAL
REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
- ---------------------------------------------------------------------------------------- ----------------
NUMBER OF
SECURITIES
UNDERLYING % OF TOTAL
OPTIONS/SARS OPTIONS/SARS
GRANTED GRANTED TO EXERCISE OR
(NUMBER OF EMPLOYEES IN BASE PRICE
SHARES)(a) FISCAL YEAR ($/SHARE) EXPIRATION DATE 5%($) 10%($)
---------- ----------- --------- --------------- ----- ------
P. R. Saueracker.......... 1,649 0.6% 46.625 January 24, 2012 48,352 122,534
J. A. Sorel............... 684 0.2% 46.625 January 24, 2012 20,056 50,827
H. R. Crabtree............ 902 0.3% 46.625 January 24, 2012 26,449 67,026
S. G. Gray................ 908 0.3% 46.625 January 24, 2012 26,625 67,472
K. L. Massimine........... 581 0.2% 46.625 January 24, 2012 17,036 43,173
N. M. Bardach............. 995 0.3% 46.625 January 24, 2012 29,176 73,937
A. Dulski................. 1,328 0.5% 46.625 January 24, 2012 38,940 98,681
- ---------
(a) One-third of the total number of options granted vests on each of the
first, second and third anniversaries of the grant date.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table shows the value realized by each of the indicated
officers upon exercise of options during 2002, measured using the price of our
common stock on the day of exercise, and the value of the options held by each
named executive officer at year-end, measured using the average of the high and
low trading prices ($43.355) of our common stock on December 31, 2002.
11
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
SHARES ACQUIRED OPTIONS AT FISCAL YEAR-END IN-THE-MONEY OPTIONS
ON EXERCISE (NUMBER OF SHARES) AT FISCAL YEAR-END($)
(NUMBER OF VALUE --------------------------- ---------------------------
SHARES) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------- ----------- ----------- ------------- ----------- -------------
P. R. Saueracker..... 24,750 598,190 178,375 14,982 1,025,393 113,730
J. A. Sorel.......... 15,000 448,503 46,952 7,350 358,339 56,861
H. R. Crabtree....... 24,199 541,981 54,101 7,568 222,559 56,861
S. G. Gray........... 45,862 1,117,803 63,916 7,574 347,326 56,861
K. L. Massimine...... 2,970 84,188 21,588 7,247 125,779 56,861
N. M. Bardach........ 67,690 566,870 737 8,210 6,287 61,544
A. Dulski............ 106,547 1,421,324 40,000 11,328 42,650 85,300
LONG-TERM INCENTIVE PLAN AWARDS IN LAST FISCAL YEAR
The following table gives information concerning the participation of the
named executive officers in a long-term compensation plan adopted by the Company
in 2002. Under this plan, the named executive officers and certain other
executives were awarded the right to earn units which are equal in value to the
price of our common stock, except that the value of a unit may not be greater
than 125%, and may not be less than 75%, of the price of our common stock at the
beginning of the performance measurement period. Actual payouts of these units,
if any, will be in cash, and will be determined by a non-discretionary formula
which measures our performance over a three-year period using performance goals
that were determined by the Compensation and Nominating Committee and approved
by the Board. The formula is based on two performance criteria: a target return
on equity percentage over the three-year period, and total shareholder return
(including reinvestment of dividends) over the period relative to the S&P Midcap
400 Materials Index. If our performance in both measures is below the threshold
level set forth in the plan, then no units will be earned. To the extent the
Company's performance on either or both measures exceeds the threshold
performance level, a varying amount of units up to the maximum will be earned.
The plan is also discussed in the Report of the Compensation and Nominating
Committee below.
ESTIMATED FUTURE PAYOUTS UNDER
NON-STOCK PRICE-BASED PLANS (1)
----------------------------------
NUMBER PERFORMANCE PERIOD (OR OTHER PERIOD UNTIL THRESHOLD TARGET MAXIMUM
NAME OF SHARES MATURATION OR PAYMENT) (2)(#) (#) (#)
---- --------- ---------------------- ------ --- ---
P. R. Saueracker..... -- January 1, 2002 - December 31, 2004 2,500 5,000 7,500
J. A. Sorel.......... -- January 1, 2002 - December 31, 2004 1,625 3,250 4,875
H. R. Crabtree....... -- January 1, 2002 - December 31, 2004 1,625 3,250 4,875
S. G. Gray........... -- January 1, 2002 - December 31, 2004 1,375 2,750 4,125
K. L. Massimine...... -- January 1, 2002 - December 31, 2004 1,625 3,250 4,875
N. M. Bardach........ -- -- -- --
A. Dulski............ -- -- -- --
- ---------
(1) The actual number of units that will be paid out at the end of the
performance period, if any, cannot be determined because the units earned by
the named executive officers will be based partly upon the Company's future
return on equity and partly upon its future performance compared to the
future performance of the S&P Midcap 400 Materials Index.
(2) If the Company's performance in both measures is below the established
threshold performance levels, then no units will be earned. To the extent
the Company's performance on either or both measures exceeds the threshold
performance level, a varying amount of units up to the maximum will be
earned.
12
REPORT OF THE COMPENSATION AND NOMINATING COMMITTEE ON
EXECUTIVE COMPENSATION
The following report of the Compensation and Nominating Committee of the
Board sets forth the Committee's policies applicable to the executive officers
of Minerals Technologies.
This report is provided by the Compensation and Nominating Committee
of the Board of Directors. The members of the Compensation and
Nominating Committee, whose names follow this report, are independent
outside directors who are not employees of Minerals Technologies, and
none serves as a member of the compensation committee of any company
that has an executive officer who also serves as a director of Minerals
Technologies.
In 2002, the Compensation and Nominating Committee adhered to its
policy that compensation programs should reward the achievement of the
short-term and long-term goals and objectives of Minerals Technologies,
and that compensation should be related to the value created for its
stockholders. The Committee sets high performance targets and rewards
their achievement with total cash compensation that is above the average
and heavily weighted towards short term incentives based on Company
performance, but within the range of compensation of similarly placed
executives in manufacturing firms of comparable size. Consistent with
this policy, each elected corporate officer's annual compensation is
determined by reviewing the previous year's compensation and, if
appropriate, applying a market and performance driven adjustment, and an
incentive payment opportunity, determined as stated below in this
report.
BASE PAY
Each employee of Minerals Technologies receives an annual
performance rating. The performance rating of the Chairman, President
and Chief Executive Officer is assigned by the Compensation and
Nominating Committee and approved by the Board. The performance ratings
of the other elected corporate officers, including those named in the
Summary Compensation Table appearing in this proxy statement (the
'principal executives'), are assigned by the Chairman, President and
Chief Executive Officer and reviewed by the Compensation and Nominating
Committee.
Based on Minerals Technologies' performance, general business
outlook and industry compensation trends, management each year sets a
guideline corporate-wide average percentage compensation adjustment for
all employees for the coming year. The percentage increase received by a
particular employee is determined on the basis of the employee's
performance rating and current compensation level within the range
established for the employee's position. The adjustment may range from
no increase to up to twice the corporate-wide average adjustment
referred to above, depending upon individual performance.
SHORT-TERM INCENTIVE PAYMENT
The Committee has continued the format of the executive compensation
program for 2002 under which a large portion of an executive's total
compensation is placed at risk dependent on the annual performance of
the Company, and a lesser portion of compensation is dependent on the
achievement of longer-term goals. Short-term incentive payments are
expressed as a percentage of base compensation. Depending upon the
extent to which the company's performance during the year meets targets
established by the Board early in the year, a bonus payment ranging from
0% (for performance of less than 85% of targets) up to 150% of base
compensation (for performance greater than 120%) is available to the
Chief Executive Officer. The bonus payments can range from 0% up to 120%
of base compensation for other principal executives. These payments,
which are made in the following year, are shown as the Bonus for each
principal executive in the year to which they are attributable in the
Summary Compensation Table included in this proxy statement. This
incentive program is intended to more closely link the principal
executives' pay to the growth of the company and the value created for
stockholders in the preceding year. For 2002, this was measured by net
income
13
growth as compared to target, on a corporate and divisional basis. At
the beginning of each year, the Board establishes a target for these
factors and sets up a scoring system to measure at year-end the extent
to which the targets are met. At year-end, a formula is applied to the
scores to determine the level of the incentive payment to be received by
the principal executive. The Compensation and Nominating Committee then
considers whether there are other factors that should also be taken into
consideration in establishing the overall level of compensation of each
principal executive. It will, for example, take into consideration
actions that have been taken by management to benefit shareholders in
the longer term that may have a negative impact on the factors and
annual targets established. During 2002, Minerals Technologies did not
fully achieve its targets on a corporate basis, but did exceed target in
certain divisions. This resulted in incentive payments that were below
established targets. The formula produced a payment of $200,063 for Mr.
Saueracker, and the Compensation and Nominating Committee agreed that he
should receive that amount as his 2002 incentive payment, to be paid in
2003.
LONG-TERM INCENTIVE
The long-term incentive plan, first introduced in 2001, allows for
the grant of performance units vesting at the end of three years
according to the achievement of pre-established goals. For the first
three-year period (2001 through 2003) the goals are based 70% on
cumulative earnings per share targets and 30% on the total shareholder
return compared to the S&P Midcap 400 Materials Index at the end of the
period. For the second three-year period (2002 through 2004) the goals
are based 70% on return on equity targets and 30% on total shareholder
return compared to the S&P Midcap 400 Materials Index at the end of the
period. No performance units vest if the achievement against both goals
is less than 80%. Between 80-120% performance on either goal, units vest
ratably between 50-150% of the target number. Performance units are
equal to the price of MTI stock except that they cannot exceed 125% of
the price at the beginning of the period and they cannot be less than
75% of that price. For the first three-year plan, the Board approved
5,000 target performance units for Mr. Saueracker, for which he will be
eligible at the end of 2003. Mr. Saueracker's target range of units is
from 2,500 to 7,500 depending upon the company's performance against the
pre-established goals. For the second three-year plan, the Board has
again approved 5,000 target performance units for which he will be
eligible at the end of 2004. The target range of units is from 2,500 to
7,500 depending upon the company's performance against the
pre-established goals.
STOCK AWARDS
The Compensation and Nominating Committee grants options to purchase
Minerals Technologies common stock to the principal executives on a
regular basis. In addition, special grants may be made to reflect
extraordinary achievements or in connection with important promotions.
In addition to making grants to key executives, Minerals Technologies
believes that, where practical and economical, all employees should have
the opportunity to participate in the future growth of the firm through
equity participation.
In 2003 the Committee approved a deferred, restricted stock award to
Mr. Massimine in the amount of 255 shares. The shares vest three years
from the date of award.
DISCRETIONARY AUTHORITY OF THE COMMITTEE
The Compensation and Nominating Committee believes that the
application of the procedures described above will generally result in
fair and adequate compensation to each principal executive. However, the
Compensation and Nominating Committee also believes that no arbitrary
formula is an adequate substitute for individual judgments in all cases,
particularly in determining the value of a principal executive's
contribution to the success of the company. Therefore, the Compensation
and Nominating Committee may from time to time use its discretion in
deviating from the above procedures (including, possibly, modifying the
factors
14
discussed above or varying their weighting) to set compensation levels
for the principal executives and others that best serve the interests of
the company and its stockholders.
INTERNAL REVENUE CODE SECTION 162(M)
Internal Revenue Code Section 162(m) and regulations thereunder,
which limit the deductibility of certain executive compensation in
excess of $1,000,000, did not result in any disallowance of a deduction
for compensation payments made by Minerals Technologies for the 2002
fiscal year. However, the Compensation and Nominating Committee has
determined that, in order to retain the discretion referred to in the
previous paragraph, it reserves the right to make compensation payments
that in part may not qualify for a tax deduction because of the
limitations of Internal Revenue Code Section 162(m).
John B. Curcio, Chair
Paul M. Meister
William C. Steere, Jr.
COMPENSATION AND NOMINATING COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation and Nominating Committee is composed of Mr. Curcio (Chair),
Mr. Meister and Mr. Steere. None of the members of the Committee is or has ever
been an officer or employee of Minerals Technologies or any of its subsidiaries.
During 2002 no executive officer of Minerals Technologies served as a director
or a member of the compensation committee of another entity, any of whose
executive officers served as a member of the Compensation and Nominating
Committee. In addition, no executive officer of Minerals Technologies served as
a member of the compensation committee of another entity, any of whose executive
officers served as a director of Minerals Technologies.
15
PERFORMANCE GRAPH
This line graph compares Minerals Technologies' cumulative total stockholder
return with the S&P 500 Index, as a performance indicator for the overall stock
market, and the S&P Midcap 400 Materials Index, a published industry index.
The starting point for the comparison is a hypothetical investment of $100
in our common stock and in each of the indexes at the close of the last trading
day of 1997. The ending point is the close of the last trading day of 2002, at
which time the price of our common stock was $43.15.
CUMULATIVE TOTAL SHAREHOLDER RETURN
MINERALS TECHNOLOGIES INC., S&P 500 INDEX, AND S&P MIDCAP 400 MATERIALS INDEX
[PERFORMANCE GRAPH]
DECEMBER DECEMBER DECEMBER DECEMBER DECEMBER DECEMBER
1997 1998 1999 2000 2001 2002
MTI $100.0 $ 90.30 $ 88.56 $ 75.76 $103.61 $96.06
S&P 500 $100.0 $128.58 $155.64 $141.46 $124.65 $97.10
S&P Midcap 400 Materials $100.0 $ 88.41 $ 79.81 $ 76.32 $ 86.08 $74.23
16
EMPLOYMENT, TERMINATION AND CHANGE-IN-CONTROL ARRANGEMENTS
EMPLOYMENT AGREEMENTS
In March 2001, Minerals Technologies entered into employment agreements with
the following individuals for the indicated terms and for not less than the
annual base salaries indicated: Mr. Saueracker, 24 months, $500,000; Mr. Sorel,
18 months, $235,000; Mr. Crabtree, 18 months, $250,000; Mr. Gray, 18 months,
$250,000; Mr. Massimine, 18 months, $200,000; Mr. Bardach, 18 months, $275,000;
and Mr. Dulski, 24 months, $385,000. The term of each of these agreements is
extended on the first day of each month for an additional month, unless either
the employee or the employer gives the other written notice that the agreement
should not be further extended. Each of the named executive officers may also
receive salary increases and annual bonuses in amounts to be determined by the
Board or the Compensation and Nominating Committee. The agreements also entitle
the named executive officers to participate in employee benefit plans and other
fringe benefits that are generally available to our executive employees.
Under the agreements, each named executive officer has agreed to comply with
certain customary provisions, including covenants not to disclose our
confidential information at any time and not to compete with our business during
the term of the agreement and, subject to our continued payment of amounts under
the agreement, for two years thereafter. We may terminate the employment
agreements before the end of the specified term of employment for 'cause' as
defined in the agreements.
SEVERANCE AGREEMENTS
Minerals Technologies has entered into severance agreements with certain of
its executive officers, including each of the named executive officers. The
agreements continue through December 31 of each year, and are automatically
extended in one-year increments unless we choose to terminate them. If a change
in control occurs, the severance agreements are effective for a period of four
years from the end of the then existing term. These agreements are intended to
provide for continuity of management in the event of a change in control of
Minerals Technologies.
If, following a change in control, the executive is terminated by Minerals
Technologies for any reason, other than for disability, death, retirement or for
cause (as defined in the agreements), or if the executive terminates his or her
employment for good reason (as defined in the agreements), then the executive is
entitled to a severance payment of 2.99 times the executive's base amount (as
defined in the agreements). The severance payment generally will be made in a
lump sum. For a period of up to two years following a termination that entitles
an executive to severance payments, Minerals Technologies will provide life,
disability, accident and health insurance coverage substantially similar to the
benefits provided before termination, except to the extent such coverages would
result in an excise tax being imposed under Section 4999 of the Internal Revenue
Code.
The agreements also provide that upon the occurrence of certain stated
events that constitute a 'potential change in control' of Minerals Technologies,
the executive agrees not to voluntarily terminate his employment with Minerals
Technologies for a six-month period.
Under the severance agreements, a change in control includes any of the
following events unless approved by the Board: (i) we are required to report a
'change in control' in accordance with the Securities Exchange Act of 1934; (ii)
any person acquires 15% of our voting securities; (iii) a majority of our
directors are replaced during a two-year period; or (iv) our stockholders
approve a merger, liquidation or sale of assets.
STOCK OPTION PLAN
The Stock Award and Incentive Plan provides that all non-vested stock
options granted under the plan may, at the discretion of the Compensation and
Nominating Committee, be made immediately exercisable upon the employee's
retirement or upon a change in control of Minerals Technologies (as defined in
the plan).
17
RETIREMENT PLANS
Each of the named executive officers is entitled to benefits under the
defined benefit pension plans which we maintain. The Retirement Plan is a tax
qualified pension plan which pays retirement benefits within the limits
prescribed by the Internal Revenue Code. The Nonfunded Supplemental Retirement
Plan is an unfunded, non-tax qualified pension plan which pays retirement
benefits in excess of such tax limits. Benefits under the Retirement Plan and
the Nonfunded Supplemental Retirement Plan are based upon an annuity equal to
the greater of (i) 1.4% of a participant's career earnings or (ii) 1.75% of a
participant's career earnings less 1.5% of primary Social Security benefits,
multiplied by years of service up to 35 years. For purposes of this formula, a
participant's 'career earnings' are based on the average earnings for the five
highest consecutive calendar years prior to January 1, 1998, and on actual
earnings for periods after December 31, 1997.
Under the Retirement Plan and the Nonfunded Supplemental Retirement Plan,
each of the named executive officers would be entitled to the following annual
benefits after retirement: Mr. Saueracker, $181,696; Mr. Sorel, $120,561;
Mr. Crabtree, $139,477; Mr. Gray, $95,386; Mr. Massimine, $78,756; Mr. Bardach,
$11,809; and Mr. Dulski, $118,968. This assumes that (i) payments will be made
in the form of a 50% joint and survivor annuity; (ii) employment will be
continued until normal retirement at age 65 (in the case of Mr. Bardach, until
September 30, 2003, and in the case of Mr. Dulski, until December 31, 2003); and
(iii) creditable compensation will continue at 2002 levels until retirement.
GRANTOR TRUST
In order to secure the benefits accrued under the Nonfunded Supplemental
Retirement Plan and the Nonfunded Deferred Compensation and Supplemental Savings
Plan (an unfunded, non-tax qualified plan which pays amounts in excess of the
limits which the Internal Revenue Code imposes on benefits under our Savings and
Investment Plan), Minerals Technologies has entered into an agreement
establishing a grantor trust within the meaning of the Internal Revenue Code.
Under the Grantor Trust Agreement, we are required to make certain contributions
of cash or other property to the trust upon the retirement of individuals who
are beneficiaries of those plans; upon the occurrence of certain events defined
as constituting a 'Change of Control'; and in certain other circumstances.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of our records and of copies furnished to us of
reports under Section 16(a) of the Securities Exchange Act of 1934, or written
representations that no such reports were required, we believe that all reports
required to be filed by our directors, officers and greater than 10%
shareholders were timely filed, except that following the elimination of a de
minimis exception to the rules under the Act, one report was filed late on
behalf of each of the directors.
18
ITEM 2 -- APPROVAL OF AUDITORS
The Audit Committee of the Board has appointed KPMG LLP to serve as our
independent auditors for the current fiscal year, subject to the approval of the
stockholders. KPMG LLP and its predecessors have audited the financial records
of the businesses that compose Minerals Technologies for many years. We consider
the firm well qualified.
We expect that representatives of KPMG LLP will be present at the Annual
Meeting of Stockholders. These representatives will have the opportunity to make
a statement if they wish to do so, and will be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR RATIFICATION OF THE
APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT AUDITORS FOR THE 2003 FISCAL YEAR.
REPORT OF THE AUDIT COMMITTEE
The following report sets forth certain steps taken by the Audit Committee
in connection with the audited financial statements of Minerals Technologies
Inc. for the year 2002.
This report is provided by the Audit Committee of the Board of
Directors. The Committee is composed of Mr. Pasquale (chair), Mr. Dunham,
Mr. Golub and Dr. Johnson. The Board of Directors has determined that each
of the members of the Audit Committee is independent and financially
literate in accordance with the rules of the New York Stock Exchange as well
as being independent under the rules of the Securities and Exchange
Commission. The Board has also determined that Mr. Pasquale, Chair of the
Audit Committee, has 'financial expertise' for purposes of the rules of the
New York Stock Exchange.
KPMG LLP audited the annual financial statements of Minerals
Technologies Inc. for the years 2002 and 2001, and also reviewed the
financial statements included in the quarterly reports on Form 10-Q filed
during 2002 and 2001. The aggregate fees billed by KPMG LLP for professional
services rendered in performing this work, and for all other services
rendered by KPMG LLP during 2002 and 2001, are shown in the following table.
2002 2001
---- ----
Audit Fees............................ $1,138,000 $906,000
Audit Related Fees.................... 71,000 38,000
Tax Fees.............................. 148,000 50,000
All Other Fees........................ 3,000 4,000
---------- --------
Total Fees............................ $1,360,000 $998,000
---------- --------
---------- --------
The Committee considers the provision of the services included in 'All
Other Fees' to be compatible with maintaining the independence of KPMG LLP
as independent auditors of Minerals Technologies Inc.
The Committee has reviewed and discussed with the management of Minerals
Technologies Inc. its December 31, 2002, audited financial statements; has
discussed with KPMG LLP, the independent auditors of those financial
statements, the matters required to be discussed by Statement on Auditing
Standards No. 61 (Codification of Statements on Auditing Standards),
AU 'SS'380; has received from the auditors the written disclosures and the
letter required by Independence Standards Board Standard No. 1,
'Independence Discussions with Audit Committees'; and has discussed with the
auditors the matter of their independence.
19
Based on the review and discussions referred to in the previous
paragraph, the Committee recommended to the Board of Directors that the
audited financial statements be included in Minerals Technologies Inc.'s
Annual Report on Form 10-K for filing with the Securities and Exchange
Commission.
Michael F. Pasquale, Chair
Duane R. Dunham
Steven J. Golub
Kristina M. Johnson
The Audit Committee's policies and procedures for engaging the independent
accountant to perform services other than audit, review and attestation services
call for any such services to be pre-approved by the Committee as a whole or by
a designated member of the Committee.
20
PROCEDURAL MATTERS
CASTING AND COUNTING OF VOTES
Votes cast at the Annual Meeting (whether by proxy or in person) will be
counted by an independent inspector of election appointed by Minerals
Technologies. If a proxy form is returned properly signed but not marked, it
will be voted according to management's recommendations on all proposals.
The Board knows of no other business that will be presented at the Annual
Meeting. The proxy confers discretionary authority with respect to any other
matters which come before the Annual Meeting, and the individuals named in the
proxy will vote in accordance with their judgment on such matters if they arise.
QUORUM
The by-laws of Minerals Technologies state that a quorum for all meetings of
stockholders consists of the holders of a majority of the shares of common stock
issued and outstanding and entitled to vote, present in person or by proxy. The
inspector of election will treat shares of common stock represented by a
properly signed and returned proxy as present at the Annual Meeting for purposes
of determining a quorum, whether the proxy is marked as casting a vote or
abstaining. On the Record Date there were 20,085,424 shares of common stock
issued and outstanding.
The inspector of election will also treat shares represented by 'broker
non-votes' as present for purposes of determining a quorum. Broker non-votes are
shares held in record name by brokers or nominees, as to which the broker or
nominee (i) has not received instructions from the beneficial owner or person
entitled to vote, (ii) does not have discretionary voting power under applicable
New York Stock Exchange rules or the document under which it serves as broker or
nominee, and (iii) has indicated on the proxy card, or otherwise notified us,
that it does not have authority to vote the shares on the matter.
VOTE REQUIRED FOR APPROVAL: ELECTION OF DIRECTORS
The by-laws state that directors are to be elected by a plurality vote of
the shares of stock present and entitled to vote, in person or by proxy, at the
Annual Meeting. Abstentions and broker non-votes as to the election of directors
will not affect the outcome of the election of directors.
VOTE REQUIRED FOR APPROVAL: OTHER QUESTIONS
The by-laws state that except as otherwise provided by law or in the
Certificate of Incorporation or the by-laws, all questions other than the
election of directors are determined by a majority of the votes cast on the
question. All votes cast in favor of a given proposal, and all votes cast
against it, are added together for a total sum of votes on that proposal.
Abstentions and broker non-votes as to the proposal will not affect the outcome,
as they will not be included in calculating the number of votes necessary for
approval and will not count as votes cast for or against the question.
COST OF SOLICITING PROXIES
The cost of this solicitation is being borne by Minerals Technologies. In
addition to soliciting proxies through the mail using this Proxy Statement, we
may solicit proxies by telephone, facsimile, electronic mail and personal
contact. These solicitations will be made by our regular employees without
additional compensation. We have also engaged Morrow & Co., Inc. to assist in
this solicitation of proxies, and we have agreed to pay that firm $4,000 for its
assistance, plus expenses.
STOCKHOLDER PROPOSALS
The Compensation and Nominating Committee will consider nominations of
candidates for director, and the Board of Directors will consider other items of
business, which are proposed by stockholders. The by-laws describe the
procedures which a stockholder must follow to nominate persons for election as
directors or to introduce an item of business at a meeting of stockholders.
These procedures provide that nominations for director and items of business to
be introduced at an annual
21
meeting of stockholders must be submitted in writing to the Secretary of
Minerals Technologies at The Chrysler Building, 405 Lexington Avenue, New York,
NY 10174-1901. If intended to be considered at an annual meeting, the nomination
or proposed item of business must be received not less than 70 days nor more
than 90 days in advance of the first anniversary of the previous year's annual
meeting. Therefore, for purposes of the 2004 annual meeting, any nomination or
proposal must have been received between February 22 and March 13, 2004. With
respect to any other meeting of stockholders, the nomination or item of business
must be received not later than the close of business on the tenth day following
the date of our public announcement of the date of the meeting.
The nomination or item of business must contain:
The name and address of the stockholder giving notice, as they appear in our
books (and of the beneficial owner, if other than the stockholder, on whose
behalf the proposal is made);
The class and number of shares of stock owned of record or beneficially by the
stockholder giving notice (and by the beneficial owner, if other than the
stockholder, on whose behalf the proposal is made);
A representation that the stockholder is a holder of record of stock entitled
to vote at the meeting, and intends to appear at the meeting in person or by
proxy to make the proposal; and
A representation whether the stockholder (or beneficial owner, if any)
intends, or is part of a group which intends, to deliver a proxy statement and
form of proxy to holders of at least the percentage of outstanding stock
required to elect the nominee or approve the proposal and/or otherwise solicit
proxies from stockholders in support of the nomination or proposal.
Any notice regarding the introduction of an item of business at a meeting of
stockholders must also include:
A brief description of the business desired to be brought before the meeting;
The reason for conducting the business at the meeting;
Any material interest in the item of business of the stockholder giving notice
(and of the beneficial owner, if other than the stockholder, on whose behalf
the proposal is made); and
If the business includes a proposal to amend the by-laws, the language of the
proposed amendment.
Any nomination of a candidate for director must also include:
A signed consent of the nominee to serve as a director, if elected;
The name, age, business address, residence address and principal occupation or
employment of the nominee;
The number of shares of Minerals Technologies common stock beneficially owned
by the nominee; and
Any additional information that would be required under the rules of the
Securities and Exchange Commission in a proxy statement soliciting proxies for
the election of that nominee as a director.
Under the rules of the Securities and Exchange Commission, if a stockholder
proposal intended to be presented at the 2004 Annual Meeting is to be included
in the proxy statement and form of proxy relating to that meeting, we must
receive the proposal at our principal executive office no later than
December 5, 2003.
By order of the Board of Directors,
S. Garrett Gray
S. Garrett Gray
Secretary
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APPENDIX 1
CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
OF MINERALS TECHNOLOGIES INC.
I. PURPOSE
The primary purposes of the Audit Committee (the 'Committee') are to:
1. Assist the Board of Directors (the 'Board') in its oversight of (i) the
integrity of the Company's financial statements, (ii) the Company's
compliance with legal and regulatory requirements, (iii) the
qualifications and independence of the Company's independent auditor;
and (iv) the performance of the Company's internal audit function and
independent auditor; and
2. Prepare the report of the Committee that the rules of the Securities and
Exchange Commission (the 'Commission') require be included in the
Company's annual proxy statement.
To fulfill these duties, the Audit Committee shall have the powers and
responsiblities enumerated in Sections IV and V, below.
II. MEMBERSHIP
The Committee shall be composed of three or more directors as determined by
the Board, each of whom shall be independent and free from any relationship
that, in the opinion of the Board, would interfere with the exercise of his or
her independent judgment as a member of the Committee. For purposes of
determining whether or not a director is independent, the Board shall, at a
minimum, apply the standards set forth in Section 303A of the Listed Company
Manual of the New York Stock Exchange (the 'NYSE Manual'), including the
proposed requirement that no Committee member may receive fees from the Company
other than director's fees, and Section 301 of the Sarbanes-Oxley Act of 2002
(the 'Act'). All members of the Committee shall have a working familiarity with
basic finance and accounting practices and must be financially literate, as such
qualification is interpreted by the Board, and at least one member of the
Committee shall be an 'audit committee financial expert' as defined by the
Commission. Committee members may enhance their familiarity with finance and
accounting by participating in educational programs.
The members of the Committee shall be elected by the Board at the annual
organizational meeting of the Board or until their successors shall be duly
elected and qualified. Unless a Chair is elected by the full Board, the members
of the Committee may designate a Chair by majority vote of the full Committee
membership.
III. MEETINGS
The Committee shall meet at least four times annually, or more frequently as
circumstances dictate. As part of its job to foster open communications, the
Committee should meet at least annually with management, the director of the
internal auditing department, and the independent auditor in separate executive
sessions to discuss any matters that the Committee or any of these groups
believe should be discussed privately. In addition, the Committee, or at least
the Chair, should meet with the independent auditor and management quarterly to
review the Company's Form 10-Q, and the matters required to be discussed by
Statement of Auditing Standards ('SAS') No. 61, prior to their filing or prior
to the release of earnings reports.
IV. GENERAL POWERS
The general powers of the Audit Committee shall be to:
1. Oversee management's maintenance of the reliability and integrity of
the accounting policies and financial reporting and disclosure
practices of the Company;
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2. Oversee management's establishment and maintenance of processes to
assure that an adequate system of internal control is functioning
within the Company; and
3. Oversee management's establishment and maintenance of processes to
assure compliance by the Company with all applicable laws, regulations,
and Company policies.
V. SPECIFIC POWERS
The specific powers of the Audit Committee shall be to:
1. Hold such regular meetings as may be necessary and such special
meetings as may be called by its Chair or at the request of the public
accounting firm serving as the Company's independent auditors or of the
Company's Controller;
2. Create an agenda for the ensuing year;
3. Review the performance of the Company's independent auditors and retain
them, subject to shareholder ratification, if applicable; request from
the independent auditor annually, a formal written statement
delineating all relationships between the independent auditor and the
Company, consistent with the provisions of the Act and the NYSE Manual;
discuss with the independent auditors any such disclosed relationships
and their impact on the independent auditor's independence; take
appropriate action in response to the auditor's report to satisfy
itself of the independent auditor's independence; and terminate the
independent auditor when and if such action shall, in the opinion of
the Committee, be appropriate;
4. Review and evaluate the lead partners of the independent auditor team
and ensure the rotation of audit partners as required by law;
5. Confer with the independent auditor and the internal auditing
department concerning the scope of their examinations of the books and
records of the Company and its subsidiaries; review and approve the
independent auditor's annual engagement letter; review and approve the
Company's internal audit charter, annual audit plans and budgets;
direct the attention of the auditor to specific matters or areas deemed
by the Committee or the auditor to be of special significance; and
authorize the auditor to perform such supplemental reviews or audits as
the Committee may deem desirable;
6. Review with management, the independent auditor, and the internal
auditing department, jointly or separately as the Committee deems
appropriate, significant risks and exposures, audit activities, and
significant audit findings, and regularly review with the independent
auditor any audit problems or difficulties and management's response
thereto;
7. Review the range and cost of audit and non-audit services proposed to
be performed by the independent auditor and approve in advance any such
services. The authority to pre-approve such services may be delegated
to one or more Committee members, who shall report any pre-approved
decision to the full Committee at its next regularly scheduled meeting;
8. Report the pre-approval of any permitted non-audit services to
management for disclosure in the Company's periodic reports;
9. Make itself available during the course of the audit or at other times,
either as a group or individually, to discuss any matters that might
affect the financial statements, internal controls or other financial
aspects of the operations of the Company or its subsidiaries;
10. Review with the independent auditor any comments on accounting
procedures and systems of control and all audit findings at all Company
locations subsequent to the completion of the audit; and review with
the independent auditor any questions, comments or suggestions they may
have relating to the internal controls, accounting practices or
procedures of the Company or its subsidiaries;
11. Review with management and the independent auditor the Company's annual
audited financial statements (and the independent auditor's opinion
with respect to such financial statements), and its quarterly financial
statements, including the nature and extent of any
A1-2
significant changes in accounting principles or the application thereof
and the matters required to be discussed by SAS No. 61;
12. Make or cause to be made, from time to time, such other examinations or
reviews as the Committee may deem advisable with respect to the
adequacy of the systems of internal control and accounting practices of
the Company and its subsidiaries and with respect to current accounting
trends and developments, take such action with respect thereto as it
shall deem appropriate;
13. Review the results of audits conducted by the independent auditor and
the internal auditor regarding internal controls and other matters
relating to the accounting procedures and the books and records of the
Company and its subsidiaries, ensure that programs are in place to
implement all accepted recommendations made by the independent auditor
and the internal auditor, and review the correction of any controls
deemed to be deficient;
14. Provide an independent, direct line of communication between the Board,
the independent auditor, and the internal auditing department;
15. Review the adequacy of internal controls and procedures related to
executive travel and entertainment;
16. Review with appropriate Company personnel the actions taken to ensure
compliance with the Company's Summary of Policies on Business Conduct
and the results of confirmations and violations of those policies;
17. Review the programs and policies of the Company designed to ensure
compliance with applicable laws and regulations, including, but not
limited to, the Foreign Corrupt Practices Act, and monitor the results
of these compliance efforts;
18. Review the Company's procedures to monitor its compliance with
applicable loan and indenture covenants and restrictions;
19. Report to the entire Board following the Committee's meetings and
activities;
20. Maintain minutes or other records of its meetings and activities;
21. Review the powers of the Committee annually and report and make
recommendations to the Board on these responsibilities;
22. Conduct or authorize investigations into any matters within its scope
of responsibilities and utilizing the assistance of independent
counsel, accountants, or other professionals as it may, in its sole
discretion, determine to be advisable;
23. Consider such other matters in relation to the financial affairs of the
Company and its accounts, and in relation to the internal and external
audit of the Company as it may, in its sole discretion, determine to be
advisable;
24. Obtain and review, at least annually, a report by the independent
auditor describing: (i) the firm's internal quality-control procedures;
(ii) any material issues raised by the most recent internal
quality-control review, or peer review, of the firm, or by any inquiry
or investigation by governmental or professional authorities, within
the preceding five years, respecting one or more independent audits
carried out by the firm, and any steps taken to deal with any such
issues; and (iii) (to assess the auditor's independence) all
relationships between the independent auditor and the Company;
25. Discuss the Company's annual audited financial statements and quarterly
financial statements, including the Company's disclosures under
'Management Discussion and Analysis of Financial Condition and Results
of Operations,' with management and the independent auditor;
26. Review disclosures made to the Committee by the Company's CEO and CFO
during their certification process for the Form 10-K and Form 10-Q
about any significant deficiencies in the design or operation of
internal controls and any fraud involving management or other employees
who have a significant role in the Company's internal controls;
A1-3
27. Discuss earnings press releases, including use of 'proforma' or
'adjusted' non-GAAP information, as well as financial information and
earnings guidance provided to analysts and rating agencies;
28. Discuss policies with respect to risk assessment and risk management
separately and with management;
29. Meet separately, periodically, with each of management, the internal
auditors, and the independent auditor;
30. Establish clear hiring policies for employees or former employees of
the independent auditor;
31. Establish procedures for (i) the receipt, retention, and treatment of
complaints received by the Company regarding accounting, internal
accounting controls, or auditing matters, and (ii) the confidential,
anonymous submission by employees of concerns regarding questionable
accounting or auditing matters;
32. As appropriate, obtain advice and assistance from outside legal,
accounting, or other advisors;
33. At least annually, review and reassess the adequacy of this Charter and
recommend any proposed changes to the Board for approval; and
34. Conduct an annual review of the Committee's own performance.
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MLTCM-PS-03
MINERALS TECHNOLOGIES INC.
Dear Stockholder,
Please take note of the important information enclosed with this Proxy Ballot.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on the proxy card to indicate how your shares should be
voted. Then sign the card, detach it and return your proxy vote in the enclosed
postage paid envelope. You may also vote your shares by telephone or via the
internet. If you choose to vote by telephone or via the internet, you do not
need to return the attached card.
If you are a participant in the Minerals Technologies Inc. Savings and
Investment Plan, you may direct the Trustee how to vote the shares allocated to
your account under the Plan. If you do not direct the Trustee, the Trustee will
vote any undirected shares in the same proportion as those for which it has
received instructions. As a participant in the Plan, your vote remains
confidential.
Your vote must be received prior to the Annual Meeting of Stockholders, May 22,
2003.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Minerals Technologies Inc.
DETACH HERE ZMLTC2
COMMON STOCK MINERALS TECHNOLOGIES INC. COMMON STOCK
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints C. Dee, S.G. Gray and J.A. Sorel, or any of
them, as Proxies to vote at the Annual Meeting of Stockholders of Minerals
Technologies Inc. on May 22, 2003 and any adjournments or postponements thereof,
on matters which may properly come before the Annual Meeting, in accordance with
and as more fully described in the Notice of Meeting and Proxy Statement,
receipt of which is acknowledged.
The Proxies will vote your shares in accordance with your directions on this
card. If you do not indicate your choices on this card, the Proxies will vote
your shares FOR all proposals.
- --------------------------------------------------------------------------------
PLEASE VOTE, DATE, AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Please sign exactly as your name(s) appear(s) on the books of the Company. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, the signature should be that of an
authorized officer, who should state his or her title.
- --------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- ---------------------------------------- -------------------------------------
- ---------------------------------------- -------------------------------------
- ---------------------------------------- -------------------------------------
MINERALS TECHNOLOGIES INC.
C/O EQUISERVE TRUST COMPANY, N.A.
P.O. BOX 8694
EDISON, NJ 08818-8694
Voter Control Number
--------------------------------
--------------------------------
Your vote is important. Please vote immediately.
- ----------------------------------------------- -----------------------------------------------
Vote-by-Internet Vote-by-Telephone
1. Log on to the internet and go to [GRAPHIC] 1. Call toll-free [GRAPHIC]
http://www.eproxyvote.com/mtx 1-877-PRX-VOTE (1-877-779-8683)
OR
2. Enter your Voter Control Number listed above 2. Enter your Voter Control Number listed above
and follow the easy steps outlined on the and follow the easy recorded instructions.
secured website.
- ----------------------------------------------- -----------------------------------------------
If you vote over the internet or by telephone, please do not mail your card.
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL ZMLTC1
[X] Please mark votes as in this example.
--------------------------------------------------------------------
1. Election of Directors. Nominees: MINERALS TECHNOLOGIES INC.
--------------------------------------------------------------------
(01) Kristina M. Johnson, (02) Michael F. Pasquale,
(03) John T. Reid, (04) Paul R. Saueracker COMMON STOCK
FOR AGAINST ABSTAIN
FOR ----- ----- WITHHELD 2. Ratification of appointment of auditors. ----- ------- -------
ALL FROM ALL
NOMINEES ----- ----- NOMINEES ----- ------- -------
- -----
- -----
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For all nominees except as noted above
Mark box at right if an address change or comment has been -----
noted on the reverse side of this card.
-----
Please be sure to sign and date this Proxy.
Signature: Date: Signature: Date:
------------------------------ ----------- ------------------------------------- -------------
