Document x5Bb82739xgOo4OoLqXgkXBZE

4 I Laser D Document Print Summary Accounting: Date Printed: Time Printed: Company Name: Exchange: Ticker Symbol: Company #: Document Type: Document Date: Amendment: Document #: Printed: Pages Printed: Disabled 02/13/92 12:35 P.M. CROWN CORK & SEAL CO INC N CCK C840700000 10-K 12/31/90 N/A 91111202 Document 51 DISCLOSURE Another cksetosum. information Service PLAINTIFF'S , EXHIBIT f ecS'f E J"202 \ SECURITIES AND EXCHANGE COEMISSION .WASHINGTON, 0. C. 20549 FORM 10-K ' mV ^ / O^^WsOAL RREEPI ORT PURSUANT TO SECTION 13 OR 15 (d) 0: THE SECURITIES EXCHANGE ACT OF 1934 Jff FogBntee^FFiisscal Year Ended December 31. 1990 salon File Wanber 1-2227 CROWN CORK & SEAL COMPANY. INC.... Exact Name of Registrant as specified in its charter Pennsylvania State of Incorporation 23-1526Mi_ I.R.S. Employer Identification No. 9300 Ashton Road. Philadelphia. Pennsylvania Address of principal executive offices 19136. Zip Code Telephone Number 215-698-5100 Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Exchange on which Registered Common Stock $5.00 par value New York Stock Exchange Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO___ The aggregate market value of the Common Stock, $5.00 par value, having voting rights held by non*affiliates of the Registrant at March 15, 1991 was $1,632,764,940. Common Shares outstanding at March 15, 1991 ........................................ 28,862,440 The following are incorporated by reference in this Form 10-K Annual Report: Description Part of the Form into which the Information, is incorporated_____ Selected information contained in the 1990 Annual Report to Shareholders Part I, II and IV Selected information contained in the Proxy Statement to Shareholders of record as of the close of business on March 15, 1991. Part III **-'*-,K ------- -1- Item 1.__ Business (Continued') In addition to the loss of the Chairman, John F. Connelly, we must also regrettably inform you of the deaths of Robert W. Drummond, who served as a member of the Board of Directors since 1957 and Myron F. Weil, who served on the Board of Directors since 1977. Two new members were elected to the Board of Directors during the year; Mr. Cordon S. bang, who is the Chairman of the Board of CCL Industries, Inc., of Toronto, Canada, and Mr. Harold A. Sorgentl, Vice Chairman of ARGO Chemical Corporation. On August 31, 1990 the Company announced a restructuring of the management organization to provide clearer areas of responsibility by creating two divisions. Mr. Mark W. Hartman, Executive Vice President, was appointed President of the International Division, which Includes Europe, Asia, Africa and South America. Hr. Michael J. McKenna, Executive Vice President, was appointed President of the North American Division, which includes the United States, Canada, Mexico and Central America. On February 12, 1991, the Company announced that it had entered into an agreement in principle with a subsidiary of peter Kiewit Sons1, Inc. to purchase Continental International Holding Company, Inc., the owner of Continental Can International, Inc. for $150 million in cash and notes. The acquisition would Include Continental's metal packaging operations and investments located in Latin America, As is and the Kiddle East, and related United States technical support operations. The transaction does not include Continental's metal packaging operations in Europe. The transaction is subject to the parties' entering into a definitive purchase agreement. On March 13, 1991, the acquisition of Ball Packaging Products Canada, Inc., General Packaging was completed. The business consists of the manufacture of general line*type cans. Capital expenditures of $67,300,000 for domestic locations and $60,700,000 for overseas locations during 1990 were used to purchase new equipment and upgrade existing facilities in Conroe, Texas; Lakeville, Minnesota; North Bergen, Nev Jersey; Seattle, Washington; Suffolk and Winchester, Virginia; Borland, Wyoming and Overseas we continued to invest to increase capacity of our plastic closure operations in Europe and to meet tide opportunities presented by the opening of Eastern Europe. . In 1990, the Company purchased 91,112 shares of its Common Stock at a cost of $5,091,000 for an average cost of $55.88 per share. This is substantially less than our purchases in previous years. Information about the Company's operations in different geographic areas appear on Page 15 of the 1990 Annual Report to Shareholders and is incorporated by reference in this Form 10-K Annual Report. -3- Item 7. Management's Discussion and Analysis of Financial Condi_tiQn_and Results of Operations Management Analysis appears on Page 16 of the 1990 Annual Report to Shareholders and is incorporated by reference in. this Fora 10-X Annual Report. Item 6 * foetal-Statements and Supplementary Data See Item 14 below. Item 9_, Disagreements on Accounting and Financial Disclosure Nothing reportable hereunder. PABI_II1 Item 10. Directors and Executive Officers of the Registrant The Directors and Executive Officers of the Registrant appear on pages 3 and 4 of the Proxy Statement to Shareholders of record as of the close of business on March 15, 1991 and are incorporated by reference in this Form 10-K Annual Report. In addition, the following Officers are considered to be Executive Officers. Name Age liSl Cornelius V. Curran Mark W. Hartman Alan U. Rutherford Ronald R.Thoma 56 Treasurer 54 Executive Vice President President International Division 47 Controller 56 Executive Vice President Procurement & Traffic lVt__ Executive Compensation This Information appears on page 5 of the Proxy Statement to Shareholders of record as of the close of business on March 15, 1991 and is incorporated by reference in this Form 10-K Annual Report. -5- Item 12. Security Ownership of Certain Beneficial Owners and Management This Information appears on pages 3 and d of the Proxy Statement to Shareholders of record as of the close of business on March 15, 1991 and Ls incorporated by reference in this Form 10-K Annual Report. Item 13. Certain Relationships and Related Transactions Nothing reportable hereunder. PART IV Item 14. Exhibits. Financial Statement Schedules and Report on Forn 8-K a) The following documents are filed as part of this report; (1) Financial Statements; The consolidated financial statements, together with the report thereon of Price Naterhouse, dated February 12, 1991, appearing on pages 7 to 15 of the accompanying 1990 Annual Report to Shareholders, are Incorporated by reference in this Form 10-K Annual Report. With the exception of the afore mentioned information and the information incorporated by reference in Part I, and Part II of this Form 10-K Annual Report, the 1990 Annual Report to Shareholders is not to be deemed filed as part of this report. (2) Financial Statement Schedules: The following Financial Statement Schedules should be read in conjunction with the consolidated fin ancial statements in such 1990 Annual Report to Shareholders. Financial Statement Schedules not included in the Form 10-K Annual Report have been omitted because they are not applicable or the required information, is shown in the consolidated financial statements or notes thereto. -6- Item 14. Exhibits. Financial. Statement Schedules and Report, on Form 8-& CContlnuad) Financial statement schedules for the years ended December 31, 1990, 1989 and 1988. Satelsl Schedule V - Property, Plant and Equipment Schedule VI - Accumulated Depreciation of Plant and Equipment Schedule VIII - Valuation and Qualifying Accounts and Reserves Schedule X * Supplementary Income Statement Information Report of Independent Accountants on Financial Statement Schedules 11 12 13 19 15 Exhibits 13) 199Q Annual Report to Shareholders 18 to 41 22) Subsidiaries of Registrant 17 24) Consent of Independent Accountants IS 28) Proxy Statement to Shareholders of record as of the close of business on March 15, 1991. 42 to 53 (4) Instruments with respect to issues of long-term debt (including hank loan agreements) have not been filed as exhibits in this Form 10-K Annual Report as the authorized principal amount on any one such issue does not exceed 10% of the total assets of the Registrant and its subsidiaries on a consolidated basis. The Registrant agrees to furnish a copy of each such instrument to the Commission upon request. b) No report on Fora 8-K was filed during the last quarter of the period covered by this report. -7- For purposes of complying with the amendments to the Commission's rules with respect to Fora S-8 under the Securities Act of 1933 and the contents of such Form, as promulgated by Release Nos. 33-6867; 34-28094 effective July 13, 1990, the undersigned Registrant hereby undertakes as follows (as required by Item 9 of the amended Form S-8) , such undertakings to be incorporated by reference into each of Registrant's Registration Statements on Form S-8, File Nos. 33-6261 and 33-01893, on file with the Commission: Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to Directors, Officers and Controlling Persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such Liabilities (other than the payment by the Registrant of expenses incurred or paid by a Director, Officer or Controlling person of the Registrant In the successful defense of any action, suit or proceeding} is asserted by such Director, Officer or Controlling Person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. In addition, the Registrant hereby furnishes the following information (as required by Item 6 of the amended Form S-8), to be incorporated by reference into each of the Registrant's Registration Statements on Form S-8, File Nos. 33-6261 and 33-01893 on file with the Commission: The Pennsylvania Business Corporation Law (the "PBCL") provides for permissive and mandatory indemnification by the Registrant of its representatives (including Directors and Officers), as well as for permissive advancement of expenses, in certain circumstances Involving third party and derivative actions. In addition, Article IV of the Registrant's By-Laws provides for indemnification of Directors and Officer to the fullest extent permitted by the EBCL for reasonable liabilities, losses and expenses (including amounts paid in the settlement of actions), if the person acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the Corporation and, with respect to any criminal matter. If he had no reasonable cause to believe his conduct was unlawful. Furthermore, under Section 2 of Article IV of the Registrant's By-Laws, any Director or Officer of the Registrant is entitled to reimbursement for expenses incurred in defending an action If the Director or Officer undertakes to repay such amounts if it is determined that such reimbursement was unauthorized. -8- The Registrant's Board of Directors has approved and recommended that the Shareholders approve an amendment to the Registrant's By-Laws at the Registrant's 1991 Annual Meeting of Shareholders that would, to the extend permitted by the PBCL, limit Directors* liability for monetary damages arising out of breaches of such Director's fiduciary duty of care without changing the statutory obligation of such Director to conduct himself with care and due diligence. The Registrant is currently considering obtaining, on behalf of its Directors and Officers, insurance protection against certain liabilities arising out of the discharge of their duties, as well as insurance covering the Registrant for indemnification payments made to its Directors and Officers for certain liabilities. -9- SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Crown Cork A eal Company. Inc. slrant jj Date March 28, 1991 By Sian W. Rut Controller Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the re gistrant and in the eapacitites and on the dates indicated: -10- (a u>-* cc H QM tn h CQZ 3LI CD E qS: PS C Ui WQ Q d 1. Ou Hz in 5 h o. 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H ffl tg a 4 ,, z o 4 Ul O w Z i-i DC 0ff Z Z UJ tn a hi 0 30 ffl UJ Ll no a N O^' 0 P) o4 o0 < Iff in z T3 c3 <9 3 in 3 Ml 0 X 4i tn lii M H <at lL a z Z <c O M CO H (*-L tzMo OC Q u3 to UJ aim H ZUJ CL 1-4 3a ui az <r > tr uzi M X u -12- H ^ Ll Q 44 -(<h fv. in Z E 3 3 tuoo 0 z n dc 0 <E Z UJ 0 <* o4 o0 O u f3fl Ul CL Iff O' at O' z H x m> O' z C to ffl ffl ffl E UJ ~ UJ to cn DC tO Z A ffl DC Z Ui <t 0 5z < Z O n X O w St p^ to N4 f m to O' uJa UmH 0 lCiCQwQ3 N xoy h o <r a iff *-- r- N O' M Iff O' 0 0 CC O' 3 ~ ffl Q - LU C ffl 0* pi O' U. ~O DC UJ a Ez Ul E 0 O' 00 0 ffl 0X a: a ffl b m 9 CN <C E Ul 0 u3 UJ 3 nO O a UJ ft 0 0 > 0n OC 3 o. LL C a z UJ DC UaJ > UJ X H tn co utoi z a to z n UJ H uj 0 M to a. 4* h cc a x ^ h* o UJ nx 9u a o ^ o N N P NN 00 (N tn tn DC a <x u. U. H DC 0 UJ D ffl U Z 3Z ac a IL <r hz <c Iff a Zw ah HH H0 <CC H o z E ui z *1 a m 0 0 CO U2C NN ffl 4 f 33 zm<r u<ar 3 3 a a Z Z UJ 0 M DL 0 30 <E Ul U. ffl ffl a Iff O4 O' 0 Iff oc h u. o >u o zo Ul O DC - aw ffl 111 H if z H0 E 3 CL MH 3O U O' z* 0 rl ft 41 0 in Z T3 E c3 m3 in O 3u 0 X *> o ffl IL z 2 O H to H CL 0z CC ffl Ocn UJ ffl f3fl 3 a Ul fzfl <c > DC m zM X u <r E CC 0 a ui IL ffl 3 Ua. H a3HzI uU a Ll 0 U. 3 w <r CROWN CORK & SEAL COMPANY, INC. AND ITS CONSOLIDATED SUBSIDIARIES SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES {In thousands) Fot the year Ended December 31, 1990 COLUMN A COLUMN B Balance at Beginning of Period COLUMN C Additions Charged to Costs and Expenses COLUMN D Deductions Write - Offs COLUMN E Balance at End of Period Reserves deducted from assets to which they apply: Allowance for losses on accounts receivable $6,609 $5,831* $3,806 $8,634 *The $5,831 Includes $2,200 assumed In the acquisition of Crown Metal Packaging, Inc. (In thousands) For the year Ended December 31,1989 COLUMN A COLUMN B Balance at Beginning of Period COLUMN C Additions Charged to Costs and Expenses COLUMN D Deductions Write - Offs COLUMN E Balance at End of Period Reserves deducted from assets to which they apply: Allowance for losses on accounts receivable $5,403 41,582 $ 376 $6,609 (In thousands) COLUMN A Reserves deducted from assets to which they apply: Allowance for losses on accounts receivable For the year Ended December 31, 1988 COLUMN 3 Balance at Beginning of Period COLUMN C Additions Charged to Costs and Expenses COLUMN D Deductions Write - Offs COLUMN Balance at End of Period $6,219 $6,019 $6,835 $5,403 -13- <0 <O0 I41t A U Ou e9, 4p1. oA ^ <o ct G*- m ccmn* x 4o1 w tO T3 fr4H <n 91 rv ofr v QO Jt<C-4i r<4t u a m io o0 o *oj atuao u0hAa ww TCaOt O V"> * rv M ro CO t r*H <A> o% rt A CM <4A A U A OOA <oJ uo T4C44kG3J:10 &G4u1aXoJ10 'GBJ r*4 f0Cs0Ol CM* *rr*-t 0Mo%*\ 3* 9> AU Ioz zM &AA oW I A X w gsooBZ won ao oo<7\V <n kt) rQ6fu0tj ft *o *1403) *4k>), 0) POhk n<o0 4W64cOD3i c <o0nn0 oo S070\ <0 4X1 os tGCoVs4L JJ 4G1 *63oP041r. 00 'HcaG3HowH' 3k0 aCu41L *cc G k r0GC40L 1+a4 80puO1t 4(GGJ3 s H g ucc4C4) *GH G GO Pua9a0u0H11 X4OMai a HMC00O1) 30X033) D U <9 a 40 G ft) *H 6 T3 RH. H3 3O tr a 01 w T3 tfl C 0 k -H 44 GC CL 4J Q> ri 01 3 O U G *H k a. G CO -C T3 a <0 kn a aj p4GJ 3 3O 45 Gk 601 -k 01 o G v04 4J 01 x: 4-1 c4o M 41 <J 0b M(3 k G rt qj 0k1 to 01 aX <y c0 aH 14 en k 4* 600> Q31 T0J1 tGs V <k0Q? H 403) 4J 00>1 4GXJ --*HH 5okk k>Ott% cu 44 *G0aSr1l c0G1r --T*0cwMc**i0 vuc4 *4CGw3oGG3 << Mu0&1 kfaHk0lJ1. T<a30 4J rGaHj a G<30 Tu0(GoG4B"31>i <44 0 *GOHU GCaWaakL Xp 0euG0H1 44G<-=s1t xkkOO:J * H0Xcwd1 Report of independent Accountants on Financial Statement Schedules To the Shareholders and Board of Directors of Crown Cork & Seal Company, Inc. Our audits of the consolidated financial statements referred to in our report dated February 12,1991 appearing on page 15 of the 1990 Annual Report to Shareholders of Crown Cork & Seal Company, Inc. (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the Financial Statement Schedules listed in Item 14(a) of this Form 10-K. In our opinion, these Financial Statement Schedules present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Philadelphia, PA February 12, 1991 -15- Consent of Independent Accountants We hereby consent to the incorporation by reference in the Prospectuses constituting part of the Registration Statements on Form S-8 (Mo. 33-01893 and No. 33-6261) of Crown Cork & Seal Company, Inc of our report dated February 12,1991 appearing on page 15 of the 1990 Annual Report to Shareholders which is incorporated in this Annual Report on Form 10-K. We also consent to the incorporation by reference of our report on the Financial Statement Schedules, which appears on page 15 of this Form 1U-K. PRICE WATERHOUSE Philadelphia, PA March 28, 1991 -16- dtSCLOSVRE, Information Services, Inc. 5161 River Road Bethesda, MD 20816 (301) 951-1300 Exhibit 22 - Subsidiaries of Registrant NAME Crown Cork & Seal Company, Inc. Crown Cork & Seal Co. (Pa.) Inc. Crown Financial Corporation Nationwide Recyclers, Inc. Foreign Manufacturers Finance Ccrp. Crown Cork & Seal Company Delaware Inc. Crown Beverage Packaging, Inc. Crown Food Packaging, Inc. Crown Technology, Inc. Crown Cork A. Seal Foreign Sales Corporation WHERE ORGANIZED Pennsylvania Pennsylvania Pennsylvania Pennsylvania Delaware Delaware Delaware Delaware Delaware Virgin Islands PERCENT OF VOTING SECURITIES OWNED Registrant 100% 100% 100% 100% 100% 100% 100% 100% 100% Crown Cork de Argentina S.A. Crown Cork Company (Austria) GMBH Crown Cork Company (Belgium) N.V. Crown Cork Coordination Center N.V. Crown Cork do Brasil, S.A. (Raihas Metalicas) Crown Quimlca S.A. Crown Cork A Seal Canada, Inc. Crown Cork de Chile, S.A.I. Crown Lltometal, S.A. Crown Cork Centroamericana, S.A. Crown Cork de Puerto Rico, Inc. Crown Cork Co. (Scandinavia) A/S Crown Cork del Ecuador, C.A. The Crown Cork Company Limited Crown Cork Company (France) S.A. Soclete Nouvelle Baele Gangloff, S.A. Crown Bender (Germany) GMBH Crown Cork de Guatemala S.A. The Irish Crown Cork Company Ltd. Crown Cork Company (Italy) S.p.A. The Crown Cork Company (East Africa) Ltd. Crown Corks of Malaysia SDN BHD Crown Cork do Mexico, S.A. Crown Cork Company (Morocco) S.A. Crown Cork Company (Holland) B.V. The Crown Cork & Seal Company (Nigeria) Ltd. Canmakers (Nigeria) Limited Crown Cork & Seal (PNG) Pty. Ltd. Crown Cork del Peru, S.A. Crown Cork A Seal (Portugal) S.A. The Crown Cork & Seal (Singapore) Co., ltd. Crown Cork Company, S.A. (Pty) Limited Crown Cork Company Iberica (Spain) Crown Cork AG Crown Obrist A.G. Crown Cork & Seal (Thailand) Co., Ltd. Crown Cork & Seal (West Indies) Limited Crown Cork Company (Zambia) Limited Crown Cork Company (1958) (Pvt) Limited Argentina Austria Belgium Belgium Brasil Brazil Canada Chile Colombia' Costa Rica Delaware Denmark Ecuador England France France Germany Guatemala Ireland Italy Kenya Malaysia Mexico Morocco The Netherlands Nigeria Nigeria Papua New Guinea Peru Portugal Singapore South Africa Spain Switzerland Switzerland Thailand Trinidad b Tobago Zambia Zimbabwe 100% 100% 99.77% 100% 100% 100% 100% 100% 1002 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 60% 100% 100% 100% 60% 57.59% 100% 98.30% 100% 100% 100% 100% 100% 100% 99.82% 100% 100% 100% -17- WE CORDIALLY INVITE YOU to attend the next Annua) Meeting of Shareholders of Common Stock being held at 11:00 A.M.. on Thursday, April 25,1991, at the offices of the Corporation, 9300 Ashton Road, Philadelphia, Pennsylvania A formal nolice of this Meeting together with Proxy Statement and format Proxy will be mailed to each Shareholder of Common Stock of record as of the close of business on March 15,1991, and only holders of recordon said date will be entitled to vote. Management of the Corporation wtfl request the holders of Common Shares to sign proxies for this meeting. WILUAM J. AVERY'- "* Chairman of the Board, President and Chiei Executive Officer HENRY E. BUTWEL* FxBCLi!(/e Vice President, Adroinrslration and Chief Financial Officer FRANCIS X. DALTON treasurer (Retired) FRANCIS J. DUNLEAVY** Retired President and Chief Operating Officer cf International Telephone and Telegraph Corporation CHESTER C. HIUNSKI'- *" Ot Counsel, Dechert Price & Rhoads, Attorneys RICHARD L. KR2YZAN0WSKT Executive Vice President, Secretary and Genera/ Counsel GORDON S. LANG Chairman of the Board, CCi Industries Inc. BOARD OF DIRECTORS OWEN A. MANOEVILLE, JR " President, M&wJeville insurance Associates. Inc. MICHAEL J McKENNA* Executive Vice President. President North American Division FRANK N. PIASECKI" Chairman cl the Board and President, Piasecki Aircraft Cciporation J DOUGLASS SCOTT Chairman Crown Cork & Sea! Canada, <nc. (Retired) ROBERT J. SIEBER" Director and Retired President cl CPC Chemicals Inc. HAROLD A. SORGENT! Vice Cfiarrroan, Arco Chemical Corporation EDWARD F STUART*" Vice Resident, Southern Division (Retired! `Member of Executive Committee "Member ot Audit Committee '"Member of Nominating Committee CORPORATE MANAGEMENT OFFICERS WILLIAM J, AVERY Chairman ot tha Shard President and Chief Executive Officer HENRY E. BUTWEL Executive Vice President AcJmifHsirsfron and Chief Finaricla! Officer MARK W. HARTVAN Executive Vice President President lotetnetomi Division RICHARD L KRZYZANCWSKl Executive Vice President Secretary end General Counsel MICHAEL J. McKENNA Executive Vice President President North American DNisfop RONALD R THGMA Executive Vice President Procurement and Traffic WILLIAM R. HOWARD Senior Vice President Operations International Division JOHN P. KHOMENHOEK Senior Vice President Operations North American Division CLINTON J WARING Senior Vice President Sales and Marketing JAMES T. BENNETT Vice Presidem 2 Piece Can Menufacturing EDWARD J. BOYLE, JR Vice President Safes Em.iein Div CORNELIUS W CURRAN Treasurer FORREST K. EASON Vice President Sales Southwest Div. JOHN W. GAHAN 'irze Presiderit Production pfenning JOE A. GEORGE, JR V.-ce Presio'enr Safes Soutnern Drv. B DOUGLAS GOODELL Vice President Machinery Division ROBERT G LE LACHEUR Vice President Sales Northeast On. GARY A. MUNSON 'vice President Sales Northwest Drv. E. JOHN PYSAFt Vice President Research THOMAS J RIKER Vice President 3 Piece Can Manutacturir.g JOHN E. ROYCHOFT Vice President Sales Central Div AT AN W RUTHERFORD Controffer RSCHARD D. SLOCUM Vice President Sa'es Western Div. HICHARD L SZOCH Vice President Engineering OPERATING DIRECTORS LAWRENCE E.ALFF 3 Piece Can Engineering REOA H. AMIRY Taxes LEWIS *. A3CAH Purchasing DAUL S. BAIN Oiiaufy/SPC Services international Dnr JOSEPH BAUDEF 2 Piece Can Engineering JAMES C.T BOLTON Insurance GARY L BURGESS Industrial Relations MEgWO J Ql RUGERIS Management Information Systems DANCLJ. DONAGPY Engineering Services LEE B. DRAPER Merger Transition THOMAS J. GARDNER Finance international Dtv ROBERT J GRLODlS Development Engineering EDWARD HATTER Traffic FRANK J JUSKA Technical Services FRANCIS J LEDERER Community Potations FRANK J MECHURA Joint Ventures and Pension lm/*istinen:$ ROBERT A. PATTERSON Internal Audit and Systems E. C NORRIS ROBERTS Finance Afertfi American Div. JOHN J RODAK Seamer Service ROBERT J. TPUTT Neman Resources SALES MANAGERS BRADLEY J QAHLGPEN GARY E ELLERBROCK PAULE. HOAR RALPH J MAHER. JR WIJJAM 6. UFHAS CROWN FINANCIAL CORPORATION Marketing Beverage Cans Crowns-Cfossres Kfachmery-Pacitic Region Meat and Fish Cans CORNELIUS W. CURRAN Vice President and Treasurer 1 f'' JOHN FRANCIS CONNELLY March 4,1905-July 6,1990 Chairman of ttw Board and Chfcri ExvcuHvb Officer 1957 to 1990 This photograph of John Connelly being welcomed by his associates as he steps off tiie Crown jet, his second home, is better than any formal portrait. It catches an intriguing marvof-action whose astute mind and good heart won him the enormous respect of the investment community and the admiration and genuine affection of Crown employees and friends around the world. John Connelly's outstanding business accomplishments are public record, yet still legendary. How he and his associates achieved a dramatic turnabout in Crown's fortunes has been widely reported. In 1955, a sleepy Crown Cork and Seal fired his curiosity and in an astonishingly short period of time John Connelly /^e r-f 2 took over its stewardship and made his presence felt tn every plant, both domestic and abroad Over the years he transformed a struggling supplier of bottle caps and fasteners with 1957 sales of $115 m.llion into a multinational manufacturing giant which he announced at last years annua! meeting achieved 1989 sales of $1.9 billion. Despite intense price comoetit on and the vulnerabi ity of foreign exchange, John Connelly reported consistent quarterly earnings increases and steered Crown :o one of the most impressive - and enviable -- records in American industry. What was the secret ingredient in John Connelly's stunning success? If asked, he probably would have enjoyed dismissing it to old fashioned common sense: hard work, strict cost efficiency, outstanding customer service. Then again, if asked. John Connelly would have denied the interview! John Connelly was a very private person ... to those who didn't know him. To fellow Crown employees, business associates, friends family and beneficiaries of his generosity, he was ar extremely forceful, persuasive, loyal compassionate character, Everyone has iheir favorite "John Connelly" story because he had incredible determination, ndomitable energy and wonderful gumption. As ar employer he was a challenge, for his stanoards of moral conduct and profitability were equally high. He absolutely loved to travel and wnile visiting Crown plants around the states and overseas, he would seek out decision makers people willing to take risks based on sound analysis. Then he would test them, place confidence in them, and move along. Of course he was tough. Bui in the end everyone remembers his asking: "Can l do anything {or you?" John Connelly spoke with canoor and conviction, ard rarely in the past tense it's no surorise his favorite part of business remained in selling, lor he took keen interest in meeting rew people and treated customers with exceptional respect They saw in him a man who couid be taken on his word. Throughout his career, John Connelly earned the reputation and pleasure of being able to make deals over a handshake, and lifelong friends of suppliers and customers. Ours is an era which lingers too long on the sadness of death, versus the celebration ot a marvelous life. John Conrelly was a success story from start to finish. For the last thirty-three years he viewed his performance at Crown and this annua! report as his ultimate test. And on these pages, in simole words, John Connelly would thank each employee for their splendid work and loyalty, thank shareholders for their fust and take great satisfaction and pride in announcing that their Company was stronger than ever and headed towards a prosperous future. 3 To Our Shareholders We are pleased to report to you that we have achieved another record year. 1990 1989 % Increase Earnings ........................................ $3.71 $3.58 + 3.6% Net Sales ........................................$3,072,070,000 $1,909,783,000 + 60.9% Net Income ....................................$ 107,077,000 $ 94,206,000 +13.7% The sales of the company increased by 61% in 1990 to a record high of $3.1 billion due primarily to the acquisition of Continental Can Canada in December 1989 and Conti nental Metal Packaging on July 15, 1990. In 1990, the company's net income increased by 13.7% to $107.1 million. Although the acquired companies contributed to the net income increase, only considerable cost reduc tion efforts throughout the year enabled the company to combat our continuing inability to recover cost increases in raw material and tabor through sales price increases. Foreign operations earnings were flat in 1990 compared to the prior year. Foreign cur rency losses were $11,700,000 in 1990 compared to $13,600,000 in 1989. We purchased 91,112 shares of our common stock at a cost of $5,091,000 tor an aver age cost of $55.88 per share. This is substantially less than our purchases in previous years and reflects our policy of first paying down the debt incurred tor the acquisitions. Capital Expenditures in the year totalled $128,000,000 - $67,300,000 in the United States and $60,700,000 overseas. During the year, we made major investments in Conroe, Lakeville, North Bergen, Seattle, Suffolk, Winchester and Worland to upgrade our equip ment and reduce costs in our plants. Overseas we continued to invest to increase capacity of our plastic closure operations in Europe and to meet the opportunities presented by Ihe opening of Eastern Europe. The acquisition of the Metals Packaging Operation of Continental Holdings. Inc. on July 15,1990 for $336,000,000 doubled the size of our domestic operations and once we have completed the integration, the combined operations will bring substantia! benefits to our company. We have restructured the Corporation to reflect this increased size by creating two operating divisions. The North American Division encompassing the United States, Canada, Mexioo and Central America and the International Division handling our other Worldwide Operations. We have expanded our Human Resources Department and will create educational programs and a career path environment to establish a management structure for our con tinued growth. The addition of the Oakbrook Technical Center as part of the Continental Can acquisi tion has brought a major advance in the Corporation's ability to improve quality, develop new products and provide technical services and assistance to our customers and affili ates worldwide. 4 We are very aware of our Environmental responsibilities and have established a Cor porate Environmental Department to ensure that we meet all requirements and take a leadership position in the future. We are presently in discussion with Continental Holdings, Inc. to purchase the nonEuropean Continental International Operations and in Canada, the acquisition of Ball Gen eral Packaging general line can business was completed in March 1991. In addition to the loss of our beloved Chairman, John F. Connelly, we must also regret tably inform you of the deaths of Robert W. Drummond, who had served as a member of the Board of Directors since 1957 and Myron F. Weil, who served on the Board of Directors since 1977. Both ol these gentlemen will be sadly missed. Two new members were appointed to the Board of Directors during the year -- Mr Gordon S. Lang, Chairman of CCL Industries, Canada and Mr. Harold A. Sorgenti, Vice Chairman, ARCO Chemical Corporation. We are sure these gentlemen will make solid con tributions to our Board. The NEW CROWN COMPANY is very exciting and has enormous potential which everyone is currently working to develop. However, we will never lose sight of those principles which have brought Crown to where it is today. At the same time, we are acutely aware of the need for change to ensure future growth. On July 8, 1990, Crown lost the man who had rescued it from collapse in 1957 and went on to guide it masterfully for 33 years of unprecedented growth and performance. I lost my mentor and friend. His Spirit and Determination win remain with us forever. We are proud of our Worldwide organization and are confident of the continued growth of our company. Sincerely, William J. Avery Chairman of the Board, President and Chief Executive Officer March 22, 1991 s '"j* *+ Crown Cork & Seal Company, Inc. FINANCIAL HIGHLIGHTS Comparative Data For Years 1986 through 1990 (In thousands except where indica:ed otherwise) Earrings per share of Common Stock . Net income ........................................ . % of net sales ................................ Net Saes ........................................... 1990 $ 3.71 $ 107,077 3.5 $ 3,072,070 1989 $ 3.58 $ 94.206 4.9 5 1.909.783 1988 $ 3.37 S 93,440 5.1 $ 1,834,060 1987 $ 2.86 $ 88.339 5.1 $ 1.717.899 1986 $ 2.49 S 79.441 49 $ 1.618.932 Cosl cl prodjcts sold (excluding depreciation).................. Selling and administrative expense . % of net sales ...................... ........... Interest experse ................................. Interest income ........................ ........ Depreciation and amortization . . Taxes or income................................... 2,653,934 86,171 2.B 59,949 ( 8.319) 101,978 71,280 1.651,066 53,204 28 11.950 (16.405) 61,832 53.930 1.569.523 50.923 2.8 10,006 (14.816} 57.234 67.750 1,456.649 49,566 2.9 8,867 (15.188) 56,936 72.730 1.383,550 46,653 2.9 10,414 (18,132) 47,831 69.' 75 Current assets...................................... Cunent liabiiit es . . ........................ Working capital ............................ .. Working capital ratio............................ Total assets ......... ................ .. 982,798 736241 246.557 1.3 2,596,458 539,848 532.636 107.212 1.2 1.855.095 503.754 321,187 182.567 16 1 073,152 536,380 338.248 198.132 1.6 1.097.897 475,409 319,846 155,563 1.5 1.010,'23 Property, plant and equipment Expenditures ............................ ..... Accumulated investment................ Accumulated depreciation ............ 128,020 1,803,513 618,922 88.598 1.287,121 524,246 102,572 952.2-6 456.357 99.547 912,416 446,674 93.655 793,078 388.198 Long term debt ................................... Short lerm debt ................................... Shareholders' equity .......................... Per share of Common Stock.......... 484.297 128,368 950,831 32.96 94.006 157.603 810,621 28.21 9.375 20.222 647,968 2398 19,725 43,985 645,606 22.73 30,691 86378 576,565 19.30 Number of Common shares--at year eno . . --average............ Common shareholders .................. , Employees ....................................... 28,849,910 28,849,362 3,714 17,205 28.734.154 26.319.264 3.873 14,747 27.018,189 27.694.638 3.765 12,567 28,402.203 30,849,759 3,774 12,354 29,868.603 31,926,678 3,889 12.403 NOTE: All data relating to common shares for Years 1986 and 1987 have been restated for comparative purposes to relied the 3 for 1 common stock split in 1988- Refer to Notes to Consolidated Financial Statements Paft. IS 6 Crown Cork & Seal Company, Inc. CONSOLIDATED STATEMENT OF INCOME (In thousands except per share amounts) Net sales............................................................. Costs, expenses and other income Cost o1 products sold excluding depreciation Selling and administrative expense.............. Depreciation and amortization...................... Interest expense............ ................ .___ Interest income ............................................... Income before taxes............ Provision for taxes on income Net income 1990 1989 1988 $3,072,070 $1,909,783 $1 834,060 2,653,934 86,171 101,978 59.949 ( 8,319) 2.893.713 1,651,066 53.204 61.832 11.950 ( 16.405} 1,761,647 1.569,523 50,923 57.234 10 006 LJfjBIC) 1 672,870 178,357 71.280 148,136 53.930 161,190 ___ 67,750 $ 107.077 $ 94.206 $ 93,440 Earnings per average common share $3 71 CONSOLIDATED STATEMENT OF RETAINED EARNINGS S3.58 $337 (In thousands) 1990 1989 1988 Retained earnings at beginning of year...................................... $760,254605,180 666.294 Netinoome.................................................................................. ... 107,077 94,206 93440 Excess of fair market value over par value of common stock purchased (1990 -- 91,112 shares; 1989-- 1.400.699 shares; 1988 -- 2,242,887 shares) .............................................................. < 4.635) ( 59,720} ( 73.335) Excess of option price over par value of common slock issued under stock option plans (1990 -- 206.868 shares; 1989 -- 580.333 shares; 1988 -- 858.873 shares) .............................................................. 5 2155,185 8,289 Excess of fair market value over par value of 2,536,331 common shares issued in the acquisition of Continental Can Canada Inc............................ -- 115,403 Amount transferred to capital to reflect 3 tor 1 common stock split............................................................... --( --89,508) Retained earnings at end of year.......................................................... $867,911 $760,254 .1605.180 Refer fo Notes to Consolidated Financial Statements 7 2-Ci Crown Cork & Seal Company, Inc. ASSETS (in thousands except book value amounts) Current assets Cash............................................................... .............................. Receivables from customers less allowance for possible losses 1990 -- $8,634; 1939 -- $6,609 ............................................. Inventory at lower of cost <y market: . Note c Finished goods and work in process .......................... . Raw materials and supplies ................................................... Prepaid expenses, deposits and other...................................... Total current assets CONSOLIDATED December 31 1990 1989 S 21,733 478,382 220,125 246.174 16.334 982,798 $ 14,398 304,317 183,577 118,315 19,241 639,348 Long term notes and receivables .................................... ...................... 55,842 investments and intargfole assets ................................. ...................... 10,711 Goodwill net of amortization ........................................... ...................... 362,516 49,690 15,841 186,840 Property, plant and equipment, a) cost Buildings ..................................................................... ........................ Machinery and equipment .......................................... ...................... Less accumulated depreciation .................................. ........................ 253,779 1415,579 1,669,358 618,922 1 050,436 171,679 991,182 1.162,861 524.245 638,616 Construction in progress............................................. ......................... Land.......................................................................... ........................ 47,163 86,992 1,184,591 Total ................................................................. ........................ $2,596,458 43,451 80.8C9 762,878 $1,655,095 Refer to Notes to Consolidated Financial Statements *7 8 BALANCE SHEET LIABILITIES AND SHAREHOLDERS EQUITY December 31 J990 1989 Current llablities Snort term debt . . Note ................................................................. Accounts payable and accrued liabilities . . Notef.............................. United States and foregn income taxespayable. Wore J .................. $ 128.368 595.341 12,532 $ '57.603 343,884 31,349 Total current liabilities........................................................... . . 736,241 __ 532,636 Long term debt . .Note g ......................................................................... 484297 94,006 Long term liabilities . . tore*................................................................. 298,558 85,946 Deferred income laxes teJ.to .......................................................................................................................... 125,315 130,976 Minority equity in subsidiaries........................... ........... ......................... 1,2t6 910 Shareholders' equity Common stock Authorized, 40,000,000 shares with $5.00 par value per share; Outstanding; 1990--28,849,910 Shanes (excluding 10,647 028 in treasury) .. .. 1989--28,734,154 shares (excluding 10,762 784 in treasury) . . . . Retained earnings ................................................................................. Equity adjjsiment from foreign currency translation .......................... 144,250 867,911 (___ 61.330) 143,671 760 254 (___ 93,304) Total sha'eholcers' equity ......................................................... 950,831 810,62' Total ........................................................................................... $2,596,458 $1.655,096 Book value per common share................................................................. $32 96 9 $28.21 2.2 Crown Cork & Seal Company, Inc. CONSOLIDATED STATEMENT OF CASH FLOWS (in thousands} _____________ CASH FLOW Cash flews from operating activities: Net income ... ........................................... ................................. Adjustments to reconcile net income to cash provded by ooeratog activities; Depreciation ard amortization ............................................................. Deferred income tax............ ................................................ . Loss on exchange....................................... -...................... Receivables and othe' assets.........................................:.................... Inventories ............................................................................................. Reimbu'sement of working capital advance of acquired company . Accounts payable and accrued liabilities............................................. Net cash provided by operating activities................ ...................... J990 $107,077 101.978 ( 3.0151 11,778 57,752 28,518 ( 159,385) ( 26.1801 118,523 7989 S 94,206 61,832 9,408 13.585 i 68,690) 7.728 -- < 848) 117,221 1988 $ 93,440 57,234 6,945 22,775 36,216 ( 24.915) -- 27,322 219.017 Cash flows from investing activities: Capital expenditures.......... . .......................... New investments and acquisition of minority interest Sales o1 fixed assets ............................................. Net cash used bv investment activities .............. ( 128,020) ( 334,604) 5.672 l 456,952) 1 88,598) ( 332.061) 878 ( 419.781) ( 102.572) ( 10,232) 6.645 ( 106,309) Cash flows from financing activities: Purchase of common slock ............................................ .. Common stock sold under stock option plans ................................ Net change in long term debt............................................................. Net change in snort term debt . ............ ...................... ... . Common stock issuec m acquisition of Continental Can Canada Ire. Net cash provided by (used by) financing activities................ Foreign exchange effect on cash Net increase (decrease) in cash Cash at beginning of year ___ Cash at end of year ................ ( 5.091) 6,248 390,000 ( 29,235) 361.922 1 66,724) 8,087 108,756 137,980 128.085 .JU.M84 { 77,398) 10,598 ( 6.902) ( 23.056) ( 96.758) < 16,108) 7,385 14.398 $ 21.783 ( 17,247) l 3,623) ___1(3,021 $ 14.398 ( 25.487) ( 9,537) . 27 558 $ 18.021 Cash paid during the year for Interest ............................... Income taxes............ . Refer to Notes to Consolidated Financial Statements $ 38,701 $ 59.901 $11,168 $ 39.755 $ 9.719 $ 63,048 10 Crown Cork & Seal Company, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A. ACCOUNTING POLICIES The consolidated financial statements include all subsidiaries. Goodwill arising after 1970 is being amortized over 40 years on a straight-line basis. GoodwilTis also affected by foreign currency translation adjustments. The prc forma information given above, does rot pur port to be indicative of Ihe results that actually would have been obtained if the combined operations had been con ducted during the periods presented and is nof htenoeo :o be a projection of fulure results Property, plant and equipneni and accumulated de preciation are relieved upon retirement or sale and the gain or loss is included in income. Renewals and replace ments which extend the useful lile of plant and equipment are treated as additions. Depreciation is provided by the straight-line method. B. ACQUISITIONS On December 29th, 1989 the Company acquired all of the outstanding capital stock of Continental Can Canada, Inc. (Continental Canada) from CCL in a busi ness combination treatec for financial report ing purposes as a purchase for approximately $330 000,000. On July 15th, 1990 the Company acquired all of the outstanding stock of Continental Beverage Packaging, Inc. and Continental Techno ogy, Inc. (Continental U.S.A.) from Continental Holdings, Inc. in a business combination treated for iinancra) reporting purposes as a purchase for $336,000,000. An excess purchase price of approximately $352,000,000 has been determined based upon the fair values ol assets acquired and liabilities assumed with the Continental Canada acquisition and pre imina-y estimates in the case of Continental U S.A. A final allocation of the purchase price of Continental ll.S A. will be determined during 1991 when appraisals and other studies particuiarty relating to restructuring costs are completed The op erating results of Continental U.S.A. have been included in consolidated net income Ircm July 16th. 1990. Amortiza tion of the excess purchase price, over a period not to ex ceed 40 years commenced in 1990. The following table presents the unaudited pro fixma results of operations as if the acquisilions of both Conti nental Can Canada, Inc. and Continental Beverage Packaging and Continental Technology, Inc. had oc curred on January 1, 1989: (In thousands except per share data Unaudited)) 1590 Net sales............................... $ 3.731.070 Income before taxes.............. Net income ........................... 168,339 102.038 1989 $ 3.578,792 530.239 84.104 Earnings per average share ol common stoc<.......................... $3 5 7 $2.91 The pro forma operating results induce both acquired companies' results of operations for the indicated years with increased depreciation and amortization on property, plant and equipment along with other relevant adjust ments to refect fair market value. Increased interest ex pense on the acquisition debt has been included along with ihe related income lax effect. C. INVENTORIES Cost is determined for all domeslic can. crown and closure inventories by the LIFO (lasl-in, firsi-out) metnod. These inventories represent 39% and 24% of worldwide consolidated inventories at December 31,1990 and 1989, respectively, Cosi of foreign inventories and machinery di vision overtones in the U.S. is determined on an average cosi basis if average cost lor all U S. can, crown and dosure inventories had been utilized, nventories would have been higher thai reported by $56,531,000 at December 31.1990 and $44,937,000 at December 31, 1989 D, FOREIGN SUBSIDIARIES The condensed financial statements of the majorityowned international subsidiar es are as follows: (In millors) Revenues ......................... Cosls and expenses . Translation and exchange adjustments ............... Income tax expense .. Not income ............. 1990 $13022 ( 1200.7) L_35.8 $ 54 0 1989 $842.8 ( 745 1) ( 13.6< ( 28.2) S 5,7 1988 $801.4 ( 702.8) i 14.2) $ 47.5 Foreign exchange losses emarale primarily from :ne Company's holdings in Latin America. Combined net assets of foreign subsidiaries reflectec in the Consolidated Balance Sheet were: (In millions) Cash and short-term investments .............. Other current assets ........ Gootiw II (net).................. Property, plarl and aouiprent (net) ............ Cither assets .................. Total assets .............. 1990 $ 13 2 396.5 '62 7 4986 14 5 1085 5 Current liabilities .. ........ _ong-term deot................ Deferred income (axes . Minority equity in subsidiaries . ............ Other liabilities ................. Total liab titles............ Net assets.............. 354 3 9C.8 572 1? 38 3 541.6 $ 543.9 1989 $ 10.7 3949 170.2 476 9 24.4 1077 1 371 9 94.0 626 .9 61.5 5909 $4862 No provision has been made for additional income taxes which could result from distribut on o' earnings o' fo'eign subsidiaries since such earnings, for the most part are permanently invested. 11 /Sjf _ Jo Crown Cork & Seal Company, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS E. SHORT TERM DEBT Information relative to short term debt for the total cor poration is as follows. (in thousands) 1990 Average interest rates at year end ........... . 11.3% Max mum short term borrowings curing the year .................. . $351,055 Average aggregate outstanding ............. $245,327 Weighted average interesi rate ............. 9.2% 1969 9.5% $1'2,257 $ 87.314 1C.1% 1988 9.8% SI 39,811 SI 02,979 7 7% The Company has $75,000,000 d unuseo lines of credit availab e under formal borrowing arrangements with various banks. F. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (In thousands) Trade accounts payable....... Trade notes payable............. Restructuring previsions....... Accrued wages and fringe benefits ........................... Accrued other...................... Total ............................. At December 31 1990 1989 $355,844 21997 64 000 $219,878 6.434 30.835 55,394 . 98J06 1595.34' 53,128 33,409 $343,684 G. LONG TERM DEBT Long term debt in the United States and overseas was as follows: (In thousands) INTEREST MATURITY Private placement 9.13% 771 &92 Notes 9.5% 12/31(92 Capital leases 13.0% 12/31(92 Private placement 9.17% 6/30(93 Total United States ... 1990 $ 00,000 184,666 9,014 100.000 393.680 Private placemen 12.5% 3/29(93 Various 65%/12.7% 3/1*94 Total Overseas.......... 85,690 4 927 90,617 Toiat long term debt . 3484 297 1989 $0 0 0 0 0 86,350 7 656 _94,qp6 $94,006 H. LONG TERM LIABILITIES Long term liabilities have increased to $298.5 million in 1990 from $85.9 million in 1989 and relate lo both domestic and foreign operations. This includes post retire ment medical benefits and restructuring provisions of the new acquisitions. In accordance with APS No. 16 certain of these liabilities are reported net of aporopriate income taxes. I. PENSIONS The Company and its affiliate? have a number of benefit plans covering substantially a I domestic and some employees of the foreign affiliates under which the cost of benefits 'S currently funded. The benefits for these pans are based primarily on yea's ol service and employees' re muneration near retirement Plan assets consist principally of common stocks, in cluding $42,721.684 of ihe Compary's common stoc-r The 1990, 1989 and 1988 pension cos: lor domestic plans, including acquired companies in '990. was as follows: (In thousands) Service cos'. -- benefits earned durng the period Interest cost on projected benefit obligations .,,, Return cn assets: -- actual -- deferrec gain!(toss) Amort zation ol net unrecognized gain ai January t, 1986 . . . Amortization ol net unrecognized (gainyioss Total pension cos: .. 1990 $ 4.564 46,256 ( 1,002) ( 48,007) { 464) ( 363) $ 984 1989 $ 2.448 14,833 ( 43,635) 26,350 ( 464) __ 576 JL 138 1988 $ 2.459 -3.469 ( 31,519} 8.636 < 464) 1 181 $ 1762 The funded status of domestic plans at December 31. 1990 and 1989 was as follows: Flans ir which. Accumulated Asses Exceecec Benetss Accurruletoci Exceeded Assets Benefits (In mi Ikjns) 1990 1939 iJSO J989 Actuarial present value of Vested benefit obligation . .......... . ($990) (S91.0) ($ 84 4] (S 78.9) Non-vested benefits . . (___ 2) ____ k_ ,8> Accumulated benefit obligation ................... ($99 2) (S91.2) ($ 85 Oj (S 7971 Actuarial present value of projected benefit obligaton Ran assets at market value ............................. ($99.3) 804 ($91 2)($ 92 0)($ 84.0) . 860 _125 3 124,1 Pan assets in excess of (less than) projected benefit ob igation ........ Unrecognized (gainp loss at January 1. 1986 Unrecognized net (gamy loss smce 1988 .......... (18 9) ( 5 2) 333 aG.1 2.6 13 6 ( 8.5) ( 14.7) It ? t ' 1 3)(__ 9.7) ( 15.7) (Accrued)'Prepaid pension cost at December 31 .. {$ 4 6) (f_29) $ 15 j $ 9.7 The projected benefit obligut on was determined using an assumed discount rate of 9%. 3t 12 Crown Cork & Seal Company, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The assumed long-term rate of return of plan assets is 10%. An assumed long-term rate ot compensation in crease o*` 5% in 1990, ' 9S9 and 1988 was used for bene fits based on employees' remuneration. Certain unon employees participate in multi employer retirement plans sponsored by their respective unions. Pension cost for non-donestic plans in 1990, 1989 and 1988 was determined unde' statutory accounting principles which are not considered to be materially differ ent from U.S. generally accepted account ng principles. Total consolidated pens on costs were: (In thousands) Domestic unions ............ . Overseas affiliates .... .. Company pension .... Total .................... 1990 $1,403 3,890 984 16,277 1989 $! .249 1.502 08 $2.859 1988 $1,279 2,999 1,762 $6,040 The funded status of the pension data above ex cludes the benefit plans of Crown Beverage Packaging Company and Crown Technology Inc. whicn were ac quired on July 15,1990 The terms of the stock purchase agreement required that Crown assume management of ail assets in the Conlinenta- Can Company pension trust (even for those businesses not acquired) because the as sets had not yet been actuarially a located among the businesses being sold and retained. As of December 31. '990, the assets had still not been so civided and Crown contnues to mar age ihe total trust. The accumulated benefit obligation of the plans relating to the acquired companies is approximate y $700 million at December 31. 1990. The assets of the Crown Beverage Packaging and Crown Technology Inc. plans include $48,226,150 ot the Company's common stock. In adcition lo providing pension benefits, the Com pany provides certain health care and life insurance bene fits tor substantially all retired employees of the domestic operations. The cosl of these benefits is recognized as ex pense as claims are paid. " These costs totaled (In thousands) 1990 $2,716 ' 989 ,$2,2^1 1988 1.847 J. INCOME TAXES Provision for taxes {In thousands) Federal taxes .......... ... Stale taxes ............... ... Foreign taxes .......... ... Total provided . .. . . . Investment rax credits ... Effective tax rate .. ... 1990 834,309 1200 35 771 $71 280 0 40% 1989 $22,375 3,325 28.230 53.930 0 36% 1988 827,670 3,130 36.950 $67,750 $ 3,281 42% The effective tax rates in each year are greater lhan the U.S statutory federal income tax rate of 34% due to stale income taxes net of federal lax benefit and net fed eral income taxes paid on dividends from oveiseas afflP ates. Also affecting the lax rate m 1990 and 1988 were the foreign taxes paid on earnings of affiliates at an average rate greater lhan the U.S. statutory federal income lax rale (5.8% and 5.' % higher, respectively) Norte of the other items above individually affected the tax rate by more than 5%. Deterred raxes (In thousands) Inc uded n federal taxes Included m foreign taxes . Movements in defense taxes 1990 $3,782 iAi05; ( 323) 1989 $2,448 5.325 $7,773 1988 $1.550 2.790 $4,340 Deferred income taxes are provided fcr timnc differences arising principally from the use of accelerated depreciation for tax purposes. The Financial Accounting Standards Board has is suec FAS No. 96 "Accounting for Income Taxes." This statement requires delerred taxes to be carried on the bal ance sheet at rales currently prevailing as opposed to the rates in effect when the deferred tax was established. The statement must be adopted by the first quarter of 1992. The Company did not apply inis statement through 1990 K SUMMARIZED QUARTERLY FINANCIAL DATA (UNAUDITED) (In thousands) 1990 Net Sales Gross Profit Fi'Sl .......... ...$ 566.575 $ 60.244 Second ... 675.073 77.984 Thirc . . . 984.019 104696 Fourth .. . . 846.403 73 234 Tota . . $3,072,070 $316 158 Net Income $ 21.361 32,078 32,199 21,439 $167,077 Earnings Per Share 5 74 1 11 1 12 74 S3 71 1969 Net Sales Gross Profit First . . . ..$431.838 $ 47,75 Second . . ... 5'4,684 56.492 Third . 509.764 50,212 Fourth .. . . 453.497 42.430 Total . .81.909.783 $196,885 Net ncoroe $19,210 27.204 29,017 .J.3,775 $94.206 Earnings Per Share { .72 1.04 1 1C ,72 $3 58 L. STOCK OPTIONS lr accordance with the Incentive Stock Option Pfan adopted in December 1983, options to purchase 2.400,000 Common Shares have been granted lo officers and key employees. Options were granted at market value on the date of grant and are exercisable beginn ng one year from dale of grant and term naie up to ten years from date of grant. 13 / A J A-- Crown Cork & Seal Company, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS T'aisactions for 1990. 1969 and 1988 are as follows Transactions for 1990 are as follows: Options outstanding January i............... Granted ...................... Exercised..................... Cancelled ................. . Options outstand ng at December 31 . .. Option price range at December 31 . ... . Options exercisable at December 31 . .. Options available to' grant at December 31 1990 351.064 0 ft 13.818) 1 2.700) 234,546 $4.75 to $4225 73.480 0 1989 1988 754.3' 4 1 021 94$ 0 392,000 (399.250) (630.C06) ( 4,0001 ( 29,6251 351.064 $14.75 to $42.25 33,269 0 754.314 $1? 00 to $42 25 174,858 0 1990 Options outstanding January 1 ..................... 0 Gianteci ........... .. 1,198.500 Exercised....................... 0 Cancelled ................ { 26,500! Options outstanding at December 31 .......... 1.172,000 Opnon once .......... Options exercisable at December 31 ........ Options available for cram ai December 31 $ 53875 3 329.000 M. LEASES In accordance with (he Non-Qua ified Stock Option Plan for senior executives, adopted in July 1984 options to purcnase 660.000 Common Shares can be granted. Options were granted at market value on the date of grant and are exercisable beginning two years from date of grant and terminate five years from date of grant. Transactions tor 1990, 1989 and 1988 are as follows: Options ouistandinc Janua-y ) ................. Granted ........................... Exercised................. Cancelled ...................... Optiors outstanding ai December 31 .......... Op tier price range .......... at December 31 ........ Options exercisable at December 3' .. Options available for grant at December 31 1990 1989 1968 93,750 3 i'45.000) C 259,833 15.000 1181 083) 0 457 500 3C OOC (227.667) ___ 0 48.750 $14 76 10 $47.50 7.500 0 93 750 SI 4.75 to S47.50 22.500 0 259.333 $12.17 to $42.75 64.333 71.250 On February 22.1990, the Board ot Directors adopted the 1990 Stock Based Incentive Compensation Plan for of ficers and key employees, which was approved by the shareholders on April 26, 1990. The plan provided for the grant of options to purchase not more than 1.500,000 shares of common stock of the Company. On February 28. 1991, the Board ol Directors ap proved an amendment to the 1990 Stock Based incentive Plan to increase :he number of shares available by 500.000 to an aggregate of 2,000,000 shares, subject to shareholder approval. As of December 31, 1990, options were granted to purchase 1.198,500 shares at an exercise price ol $50 875 to 228 employees of the Company and its subsidiaries. The Company and its subsidiaries lease manufactur irg, warenot.se. and office facilities and certain equip ment. such obligations having been assumed with the ac quisition cf the Metal Packaging Companies of Continental Can. " Future minimum tease payments requited untier cap tal leases and operating leases having initial ot lemaining non-cancelable lease terms in excess ot one year, are sat torn below. Sucn future minimum lease payments have not been reduced by sublease rentals of $11.137.000 to ba received subsequent to December 31: 1990. ' (In Itiojsancs) 1991................. .......... 1992 ....................... .......... 1993............................................... 1994............................................... 1995............... .. Thereafter................................. Less: amount represent ng nteresl relating to capital leases Capital leases $'5,549 S.888 96 96 72 241 $24,942 __2,35 Operating leases $ 6.635 6.270 6,116 5,041 4.678 11 502 $40 242 Present value cf future minimum payments on capital leases 22.586 Less: current portion . .... Total long term obligations under caoital leases . 13,572 jJLQli Rent expense under operating leases tor the year erded December 31, 1990 was $4,996,000. N. OTHER MATTERS In December 1990 Ihe Financial Accounting Stand ards Board issoec S'atement of Finarcial Accounting Standard No. 106 "Accounting tor Post Retirement Bene fits Other Than 3enstons'' The effect ot applying this state ment s not currently ascertainable, ftowever preliminary estimates indicate it could have a material effect Certa n post retirement med cal benefits have already been ac crued (See Nole H) Certain prior year balance sheet terns have been reclass lied to improve comparabi ity. 14 Crown Cork & Seal Company, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 0. INFORMATION ABOUT THE COMPANY'S OPERATIONS IN GEOGRAPHIC AREAS FOR THE YEARS ENDED DECEMBER 31,1990, 1989 AND 1988 (In millions) Geographic Areas Wet Sates Operating Profit United States ........................ Europe....................................... North & Ceniral America.......... All Others................................... . Eliminations .............................. Total Operations.................. . `Corporate Expense/income ... Interest Expense ..................... 1990 $1,805.5 538.2 567.3 210.8 [ 49.81 3.072.0 1989 $1,104.0 443,9 201.2 203.6 < 42.9) 1,909.8 1988 $1,062.5 444.2 188.7 179,9 ( 41.3) ' ,834.0 1990 $ 9B.8 39.0 65.4 29.1 ( 30) 229.3 9.0 ( 59.9) 1989 $ 50 3 27 5 30.7 34.9 i 2.6] 1508 9.3 f 12.01 1988 $ 70.6 33.4 37.3 28.8 .1-^0) 1681 3.1 ( 1O.0) Total ........................................ . $3,072.0 $1,909,8 $1,834.0 $178.4 $148.1 $161.2 Geographic Areas Assets 1990 1989 United Stales .................. Europe ............................ . North & Central America . All Others ....................... . Corporate Assets ...... $1,502.4"* $ 335.3 618.1 118.9 21.8 574.4 286.0 657.5** 122,8 14.4 Total .......................... . . $2,596.5 $1,655.1 1988 $ 578.3 255.2 120.2 101.4 18.0 $1,073.1 Capita,1 Expenditures 1990 1989 1988 S 67.3 25.0 31 3 4.1 $35.2 276 12,3 13.5 $ 40.8 31.1 22.0 8.7 Deprec/afion and Amortization 1990 7989 1988 $ 54.0 18.5 24.3 5.2 $36.6 M.4 8.0 3.8 $34.8 12.0 6.4 4.0 $128.0 $88.6 $102.6 $102.0 $61.8 $57.2 Includes foreign currency exchange losses `Included in Assets -- "North & Ceniral America0 tor 1989 is $519.2 million relating to the acauisition ol Continental Can Canaca Inc "'Inducted in Assets -- "United States" for 1990 is $864.8 million relating ta the acquisition of Continental Can USA. Intercompany sales are accounted for on a cost plus mark-up basis. During 1990,1989 and 1938. respectively, sales to other geographic areas were made from the United States in the amount of $24.0, $21.0 and $29 8 million; from Europe $1.7, $1.0 and $1.2 mil-ion; from North & Central America 322.8, $20.3 and $10.0 and from All Others $1.3. $ 6 and S.3 million. The classification "All Others" induces countries in South America, Africa and the Far Easi. The Company's principal operation, representing more than 90% of its business, is the fabrication of steel and alumi num into cans, crowns and closures. The Company also manufaettres parts for and assembles various machines primar, ly for the beer and beverage industry. REPORT OF INDEPENDENT ACCOUNTANTS To the Shareholders and Board cf Drectors of Crown Cork & Seal Company, Inc. In our opinion, the accompanying consolidated balance sheet and the related consolidated statements of income, retained earnings and of cash flows appearing on pages 7 to 15 of this report present fai'ly. in all material respects the financial position of Crown Cork &. Seal Company, Inc. and its subsidiaries at December 31.1990 and 1989, and `he results of their operations and their cash flows for eacn of the three years in the period ended December 31,1990, in conformity w*th generally accepted accounting principles. These `inancial statements are the responsibility of the Company's man agement; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with generally accepted auditing standards which require that we plan and per form the audit to obtain reasonable assurance about whether the financial stalements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall fi nancial statement preservation. We believe that ou' audits provide a reasonable basis fiuoir thine? oijpptiiniivojnn expressed above Thirty South Seventeenth Street Philadelphia, Pennsylvania 19103 February 12. 1991 LL,& 15 Crown Cork & Seal Company, Inc. MANAGEMENT ANALYSIS NET SALES ncreased 61% in 1990 from $1 9 billion to a record high of S3.i billion which followed an increase of 4% in 1989 over 1968. Both domestic and overseas oper ations contributed to this increase Domestic sales in creasing by 64% to $1.8 billion and overseas sales by 57% to $1.3 billion In 1989. both domestic and overseas sales ircreased 4% over 1988. The acquisition of the Metals Packaging companies of Continental Can on July 15, 1990 increased domestic sales by 55% over 1989 and the acquisition of Continental Can Canada Irom CCL Industries on December 31,' 989, increased overseas sales by 45%. Unit can sales in the United States increased by 9% for the total Corporation (excluding acquisition) in 1990. Overseas unit sales im proved with he beginnings of growth from the opening of Eastern Eurooe and continuing demand for the Corpora tion's plastic closures in Europe. NET INCOME in 1990 at $107.1 million increased 13.7% over the $94.2 million reported in 1989 which compared to a 0 8% increase in 1989 over the $93.4 million reported in 1988. Operating profit from operations in 1990 tolalled $229.3 million compared to $150.8 million in 1989 and $168.1 million n 1968. In spite of the fact that the Com pany has again been unable to fully recover ccst inc-eases in selling prices due to the competitive situation in the industry, we were ab'e to maintain operating profit margin in the United Slates at 5.5% to net sales reflecting the Company's continuing determination to reduce costs. In Europe, the operating profit has increased to 7.2% to net sales in 1990 from 6.1% in 1989, while in North and Central Amenca, although absolute operating profit has more than coubled at S65.4 m llion the percentage to net sales has declined from 15 2% to 11.5% in 1990 primarily due to more difficult market conditions in Canada. We have continued throughout 1990 to reduce our costs to combat the effects of the very competitive pricing in the indjstry in the United States. Investments in machin ery and equipment resulting m increased line speeds, constant work by research and development, a ong with close scrutiny of all cost elements combined tc reduce our cosi while maintaining quality. In foreign operations, we again sullered foreign currency losses of $11.7 million in 1990. somewhat tower than the $13.6 million reported in 1989 wh ch was also lower than the $14.2 mi lion reported in 1988. SELLING AND ADMINISTRATIVE costs at $86.2 million or 2.8% to net sales in 1990 was the same in percentage terms as in 1989 and 1968 tor the total Corporation, al though obviously in dollar terms, there was a substantial increase m 1990 over 1939 and 1988 dje to the acquisi tions. Expenses reported in 1989 were $53.2 million and in 1988. $50.9 million In the fourth quarter, domestic sales and administrative cosls increased to 2.9% from 2.4% in 1989 reflecting the addition from the acquis tion in July 1990 We expect this level :o decline in the third and fourth quarter of 1991 as the effects of rationalization act ons are real zed. INTEREST INCOME at $8.3 million was almost bait that re ported in 1989 $16.4 mill on and $14.8 mill on in 1988. The major reduction occurred in foreign operations where in terest generating funds in ` 9B9 were either invesled ;n op erations or paic as dividends to the parent in 1990. INTEREST EXPENSE at $59 9 million in 1990 com pares to $1.95 milion in 1989 and $10 million in 1988. This re flects the increased borrowing costs necessary to finance both the Canadian and United States accuisitions. AVERAGE INTEREST RATES on short term borrowing at December 31,1990 was 11 3%. higher than 1989`s 9.5% and 1988`s 9 8% In ihe United States tne rates were cn average lower while short term borrowing overseas, pri marily in Canada, resulted in Ihe total corporate average being higher. The increased levels of short term borrowing reflect the financing of the acquisitfens in Canada and the United Slates, although by year end, funds generateo by operations had decreased the short term requirements. LONG TERM DEBT has increased substantially, primarily in the United States to tinarce the Metals Packaging ac quisitions with the maturities spread to June 1993. In over seas operations, the long term debt relates to Canadian operations except for some small amounts mainly in Eu-ope. CAPITAL EXPENDITURES in ihe year totalled Si 26.0 mil lion compared to $88 59 million in 1989. The majority of the increase reflecled increased investment in domestic ac t vities and the newly acquired companies LITIGATION: The Company has been cited in iawsute and legal proceedings by Federal and some State Environ mental Protection Agencies. Although the company is contesting all such lawsuits vigorously, ihe final results in these actions cannot be predicted with certainty it is how ever :he opinion of Company management, after consult ing with counsel, that they will not have a material aoverse alfect on the Company's tinancal position. TAXES ON INCOME at 40% were marginally higher than 1989 at 36.4%. The 1989 effective tax rate was recuced by the utilization of carry forward tax losses in certain loca tions overseas. Defe-red tax provisions were lower due to timing differences in overseas operations. LIQUIDITY AND CAPITAL RESOURCES (n millions! Working capital ........... Common Shares of stock purchased for treasury Cost .......................... Cash f'om operations . Capita additions ...... . 1990 $246.6 1969 $107 2 1986 $182 6 91,112 1,400,699 2,242,887 $ 5.1 % 667 $ 7?4 $118.5 $126.0 $117 2 $ 866 $219.0 $102.6 In December 1989, the Company borroweu $202 mil lion and issued 2,536,331 shares of Common Stock to pur chase Continental Can Canada. Inc. In July 1990. tne Company borrowed an additional S443 million to acqu re the Melals Packaging companies of Ccntinenlal Helpings .nc in the United States. At the time of acquisition, toe Company reimbursed Coniinental Holdings for working capital advancec lo the Metals Packaging Companies and made additional advances of $52 million by year end 1990. This additional investment of $495 million has been achieved at a net additional borrowing of only' $361 millicn by year end 1990. due to foncs being generated from op erat ons worldwide. 1G NORTH AMERICAN DIVISION CENTRAL DIVISION Chicago. 111. Cinc-nraii, OH Faribault. MM Mlwaukee. Wl Perrysburg OH EASTERN DIVISION Baltimore. MD Philadelphia. 3A Airchosier VA NORTHEAST OIVISION Lawrence, MA North Bergen, NJ NORTHWEST DIVISION Portland, OR SALES OFFICES WITHIN the UNITED STATES John E. Rcycrolt. Vice President SOUTHERN DIVISION Walter J Coran, District Sates Manager John H. Anderson, District Sales Manager W King Van Nest. District Sates Manager Neal R- 0 Malloy. Distect Sales Manager Airier. MC Atlanta, GA SOUTHWEST DIVISION Edward J. Boyle. Jr, V-ce President John C Eissler, Product Sales Manager Howard L Bornan, Rcg-onal Sales Manager Be-na'o R, Grande, D strict Sales Manager Robert G Le Lacheur, Vce President Darnel P. Rgore. District Sales Marager Rooert G. Rxoroba Regional Sales Manager Stephen E Krcnski. D strict Sates Manager C. Paul Lkteatri, District Saes Manager Athene Forth Worth, TX Conroe. TX WESTERN OIVISION La Meade, CA Los Angoes. CA Salt Lake City. UT San Leandro. Ca MACHINERY DIVISION Baltimore MD doe A Geosge Ji Vice Presicent William ft Keith. Regional Sales Manager Fonest K Eason, vice President C. Yarn Scrrmct Cislrict Sales Manager Richard D Slocum Vice Presteem Michael P Madgan. Regional Sales Manager E. F Marian Company B Oougias Goeael. Vioe President Gary A. Munson, Vice President James Wilson, District Sales Manager CROWNS AND CLOSURES Pam E. Hoar. Regional Sates Manager Drawferdsvitla, IN CENTRAL AREA-2 (Hew Lakevile. MN Mankato. MN Olynpia. WA Si Paul. MN Union Cily. CA Van Nuys CA Wortard. WY PLANTS WITHIN the UNITED STATES FtoCer G. Strckroth Manufacturing Manager Normand J Jandreaj. Part Marager Frank E Babic. Jr.. Plam Manager James H. Sadler, Plant Manage* Gerard H. G.ftord, Plant Manage* Ban/ E Kauffman. Plant Manager Donald ... Queen. Part Manager Daniel R. Stine. Jr., Plant Manager CENTRAL AREA--3 piece Chicago. IL CrawfordsviUa. IN Decaiu- IL Faribault, MM Miwaukee. Wl Omaha, NE Oshkosh. Wl Portage. IN Thomas R Lyons. Manufacturing Manager Gerald M. Gresko. Plant Maiager Joseph R Iderce. Plant Manager Eugere J Stiiall. Plant Manager James P. Zahn. Plant Manage* Paul A Pitted Plant Manager Philip A. Swanson Rant Manager Sanrsjel W DeVos Ram Manager William R Hewitt, Rant Manager NORTHEAST AREA--2 piece Ernes: C. Mehriander, Manufacturing Manager Kankakee. IL Michael J. Hallman, 3lant Manager LaCrosse, Wl Lawrence MA Emory G. Herbert, Flant Manage* Milwaukee. W Gail P langenfeid. Plant Manager North Bergen, NJ Kirk and P Miller. Plant Manage* SOUTHWEST AREA--2 piece Robert Perry, Manufacturing Manager Abttene. TX Michael E. Turner, Rani Manager Batessile. MS Larry G. Outlaw Rant Manager Ccnroe, TK Edward w Ber*y. Plant Manager Fofl Bend. *X Jerome M Ackerman, Rani Manager Longview, TX Dave T pierce, Plant Manager Winchester, VA Richard W. Barren Rant Manager SOUTHERN AREA--2 piece Atlanta, GA Atlanta. GA Cheraw. SC Cincinnati, OH Dayton, OH Edison, NJ Pern/, GA Puaski Perk UD Robert W. Kelly, Marulactuing Manager Jaires W Mil s Jr, Rani Manager Robed L. Ftibrghi. vr.. Plant Manager Wil iam R Wilke'son, Rant Manager Kenneth D GalberaJh Plan: Manager Wil iam J. Deppcr. Plant Manager Patrick D. Gi tespie, Plant Manager Troy E, Lovett, Plant Manager Timotey D Regar, Part Manager OTHER Battimore. MD (Machinery) Baltimore. MD (Art & Ratei Fairless Hills. PA Bartow, FL (Overhaul) Oak Brook Park, IL Robert A Byrnes. General Manager Robert G Re ss. Rant Marager Herry L. Siarkowsd. Plant Manager Ralph H. Smith Plant Manage* Tachrical Center EASTERN AREA--3 piece Arden. NC Baltimore, MD Hanover. 3A Hurlccs. MD Salisbury. MD Spartanburg, SC Swedesboro. NJ Vineland, NJ Casirmr J Gorecki Jr. ManrJactU'ing Manager Brian G Powell. Plan Manager Robert J Rothtneyer Ham Manager Lawrence A George. Plant Manager John H. Ballance, Jt. Plant Manager Richard B Cropper, Rani Manager F-ancis J Fcrte, P aril Manager Charles M. Krohn. Plant Manager John P Bugnitz Plant Manager NORTHEAST AREA--3 piece James M Toomey, Mamractu'ing Manager Penysourg, QH Larry Oates Plan Marager Philadelphia, A Michael A Hunter Plant Manager Ridgekeld Park, NJ David J. Toth. Plant Manager SI Louis, MO John A. Bchne-i, Planl Manager Shoreham, Ml Ronald E Van Sant. Plant Managet Suffolk. VA Richaid DeYoung, Piart Managet WESTERN AREA--3 piece La Mirada, CA Los Angees. CA Pittsburg, CA Pocatello, ID Port arid. OR San Leandro. CA Seattle. WA Walla Walla. WA Micnael W Felaser, Manufacturing Manager Richard I.. AdUsson, Pant Manager Raph M Butlermore. Rant Manager Donald L Sp-enkal. Plant Manager George J. Vanderkin Rant Manager John J. lewis. Plant Marager Victor W Perkin. Plant Manager M Michael Tierney. Plant Manager Be-na-d N Baumann, Plant Manager 17 ^Jjr*. 3& NORTH AMERICAN DIVISION -- COMPANIES OUTSIDE the UNITED STATES WORTH AND CENTRAL AMERICA CANADA CROWN CORK & SEAL CANADA INC Toronto (4) Perry W. Nelson, Prescient ard Cue! Executive OHicet Calgary Robert E. Belanger, Sen or Vice President Finance & Chatham Administration Edmo'ton C Roger Hen-y, Senior Vice ^resident Operai ons Montreal <4| Vlichaci J Tcbtn. Semo- Vice President Sales and Trenton Market ng Winnipeg Guy G Labelle, Vice President Manufacturing Edward A. McLean. Vice President Human Resources Peter F Monsberger CdrLoier and Secretary David B Baikie. Director Quality improvement Process Wi liam H Lawless. Director Research and Technical Service Louis Solys. Director Purchasing Eastern Region Chris R. Daly. Sales Manager Eastern Ftegion Francis P. Glcrieux, A-ea ManageJohn P Cenerelli. Plant Manager Central Region Anthory H. Wedgoury, General Sales Manager Ronrar R. Towancki. Disiric Sales Manager. Chatnam Allan McKeag, Plant Manager, Keele North Robert D. Allen. Plan: Manager, Kcdc Sculh J Douglas D. Wharry, P ant Manager. Weston Brian Poo e. Plant Manager. Chatham Douglas J Russell, Plan Manager. Trenton Robert S. Saunders, Nam Manager. M ssissauga Western Reg or. Breni Chapman. Sales Manage-. Raines Brent Keeley. Sales Manager, Br( sn Columb a John T Mo-onck. Plant Manager. Winnipeg Andre A Pomerleau. Plant Manager. Cagary Robert L. Boseiti. Flam Manager, Furnotuon MEXICO Mexico City San Lus Pdtosi COSTA RICA San Jose GUATEMALA Guaiemaia City PUERTO RICO San Juan CROWN CORK DE MEXItTO SA. Oscar F Francks _r. President Fe ipe Vasco E.. Acminstialive Assistant! Jo'ge 3emal C., (Jorilrotler Alfredo A(>a Planl Manager. Me* co City Ticaido Alania Piani Manager San Luis Pctosi .lo-ge R Gonzaies Enginee-mg Manager CROWN CORK CENTROAMERiCANA S A Oscar F FrancKe. ji., President Franklin Hicalgo Manager Max mo Lau Plant Manager Miguel 'Jmana, Controller CROWN CORK DE GUATE MAI.a. S a Oscar F Francks. Ji, Resident Luis Drlicti. General Managei CROWN CORK DE PUERTO RICO. INC. Arturo Diaz Cataldo. President Jose R Lauieano v.cc President F trance and Administration Ruben Tejron Rant Manager INTERNATIONAL DIVISION EUROPE AUSTRIA Schwarwnstadt EUFtOPEA.N COMPANIES AUSTRIA. BELGIUM, DENMARK. FRANCE, GERMANY, GREAT BRITAIN HOLLAND. IRELAND PORTUGAL SPAIN AND MOROCCO CROWN CORK COORD NATION CENTER N V ANTWERP, BE.GIUM William H Sirfid. Maiaatng Director AFons Bekx, Director Engineering and Technical Services Xavier Blanpain. Drectcr AdmmisJ-aticn and Gene's! Counsel Michael J Maiding, Director of Finance ` Jozet Salaeds Controller Waller Segers Purchasing and Tratfic Ludovic Van Lierde, Ge-eral Sales He-man Van der Eyndc. Quality Assjrarce Guy Van der Celen. Business Dcvsiopmeri Eastern Europe CROWN CORK COMPANY {AUSTRIA). GMBH Ho-st Inthaler Genera Manager GREAT BRITAIN THE CROWN CORK COMPANY LIMITED London, England Richard L Hold-on Managing Director Tredegar. Wales Gaicoo Cassidy. Financial Controller Edinburgh Scotland Francis Jacksor. Marketing Director HOLLAND Roitercam CROWN CORK COMPANY (HOLLAND) B V. Leu s Verscnu-en Managing Director IRELAND Cork THE IRISH CROWN CORK COMPANY LTD Michael K Byrne, Director and Geneiai Manager Charles St J Nolan, Sales Director PORTUGAL Lisbon CROWN CORK 5, SEAL (PORT UGAI) S A Henriqje A PSres. Managing Cirectoi Carlos J F Bapnsla Plant Mans get BELG UM Antwerp Packaging CROWN CORK COMPANY (BELGIUM) N.V. Hugo Palroons Managing Qrector Leo Van Eeghem. Personnel and Administration Frans Vamojdi. Plan! Manager Lcnderzeat Machinery Jean Mane Gartner, General Manager Philippe 3oucaucy. Engineering Meager Lucien De Keghel Product Manager Leo Verheyen, Pari Manager DENMARK Copenhagen CROWN CORK CO (SCANDINAVIA. A-'S John Kjollcr D rectcr and General Manager Svcnd Fromberg financial Director FRANCE Pans CROWN CORK COMPANY (FRANCE) S..A William H. Smith, Managua Direclor Roiand Mayei, Assistant Managing Director GERMANY Frankenlhafc'Ptalz Bcdbutq CROWN CORK COMPANY (GERMANY) GMBH Otto Bender. Director Hans Gilbert. General Manager Walter Becker Conroller ' Gerharc Kramer, Scc-ctarv Withelrn Musel. Technical Manage- ^?4L v SPAIN 8ilbao Madrid MOROCCO Casaotanca ITALY Milan SW TZERLAND Reinacr 18 CROWN CORK COMPANY [SPAIN) Salvador Estzpe. Managing Directoi J Graham Mcllwain Firandai Cuntroller CROWN CORK COMPANY (MOROCCOj S A Salvador Estape Managing Director Abdetaziz Eeloubad, General Manager CROWN CORK COMPANY (ITALY) SpA Carlo Caliirtam, President and Martag ng Dtrectot Aiessand-o Otielli, General Manager CROWN QBft'ST AG . Hars J loiiige- Chairman and Managing Drector Emsl Hotan, Director ot France and Administration Torn F. Banl, Technical Direclor Peter 0. Geiger. General Manager Marketing International CROWN CORK AG Hens J Loenger. Chairman arc Managing Director Li not Hotar. Director ot Finance INTERNATIONAL DIVISION 30LFTH AMERICA ARGENTINA Buenos Aiies 3RA21L Aracaju Manaus Porto Alegre Rio da Jane ro Sao Paulo Victoria Santo Artao CHILE Santiago SOUTH AMERICAN COMPANIES (EXCEPT COLOMBIA. TRINIDAD 4 TOBAGO AND VENEZUELA) Oscai F Francxe, Sr. President Nelson Solo. Quality Assurance Jorge Bosetti, Engineering Rated Pareja, Softlirvg Equpman: CROWN CORK D6 ARGENTINA, S A Percy Crosby, Vice President Raul Cohen, Controller CROWN CORK DO BRASIL S A. Attdio Ferrari, V ce President Edson Alves Ferreira. Manufacturing Manager Luis Vasquez, Manufacturing Engineer Antonio C Lo'enzo. Controller Domingos R. Sousa. Chief Engineer flavio A Feneira, Plant Manager, Flic de Janeiro Manuel Castro, Plant Manage'. Aracaju Jane L C. Nunez. Hart Manager, Victoria Santo Antao Jarete Nunez. tant Manager, Manaus Me"/ Maaga, Plant Manager, Porto Alegre CROWN CORK DE CHILE SAL Eduardo Cruz. Vice President Jorge Mendez. Controller Francisco Miranda. Chiel Engineer Aqiiles Giawo. Qua ity Control ECUADOR Guayaouil PERU Lima Pucallpa COLOMBIA Bogota Medellin Barranquilia TRINIDAD 4 TOBAGO Pot ol Spain VENEZUELA Caracas CROWN CORK DEL ECUADOR C A. Roberto Law. Vice President Manuel Lopez, Sales Manager Feliciano Roldos. Conlroiier Franklin Marin, Chiel Eirgineer CROWN CORK DEL PERU SA. Fernando Goilia, Vice President Alfredo Ordonez. Controller TeodoroTsuja, Chief Engineer Luis Pita. Plant Manager. Pucallpa CROWN LiTOMETAU S.A John W Cunrirgtiarn. President Jorge Garcia R , Vice President Caifos Barrera B , Sales Manager Samuel Rodriguez H , Controller Gustavo Lozano F., Techncal Manager Jorge O'ozco S., Plant Manager MeaeWn Octavio Rivera P , Plant Manager. Barranquilia Luis H Vargas. Plana Manager Bogcta CROWN CORK 4 SEAL (WEST INDIES) LiMlTED John W Cunningham, Chief Executive Offcer Roger D. Flook. Managing Director Roald G. Mackintosh Plant Manager CROWN CORK DE VENEZUELA, C.A John W Cunningham, President LFRICA AFRICAN COMPANIES (EXCEPT NIGER. A) J. Richard Sheppard. Managing Di'ecior CBVYA Na totot THE CRCWN CORK CGMPAMV (EAST AFRICA) LTD. John Bone. Director/Manager Francis A. Kombo. Plant Manager Praia Ghandi, Fnancial Controler iOLTH AFRICA Johannesburg (2) Caoe Town . CROWN CORK COMPANY SA. (PTY.) LIMITED Henry Lavery Director T aart Kruger, Controaer/Secretary Christophs' R. Waton. Techn cal Manager Jeffrey T. Wilson, Manager. Sales Michael R. Srrythe. Managet, Manufacturing Arthony Shepperson. Plant Manager. Johannesburg Qouglas E. B. Trollope, Plant Manager (D4I) Johannesburg Vincent Nienabe', Platr: Manager, Cape Town ZAMBIA Ncoia ZIMBABWE Harare NIGERIA Lagos CROWN CORK COMPANY (ZAMBIA* LIMITED Marlin Bennett, Direclot/Marager Stev/ait Lamb. Accountant NeS K.'Samasungwa Plant Manager CROWN CORK COMPANY (1958) (PVT) UMHED Jchr L. G. Tasker Director/Manager Norman Raisbeck Accountant John Chadv/kik. Plant Manager, Brussware THE CROWN CORK & SEAL COMPANY (NIGER IA) LTD. CAkMAKERS IMGERfA) LTD Anthony A. Gill, Director and General Manager A 0. Otenaike. Dreclcr 'ACIFlC VDONESA Jakarta MALAYSIA Jchore Bahru 'AJHJA NEW GUINEA Lae ASLAN AND PACIFIC COMPANIES Gianam S. Bel, Chatman and Managing Director P.T. CROWN CORK 4 SEAL INDONESIA S. Soedomo. Director A Mulyana, Financial Consoler CROWN CORKS OF MALAYSIA. SDN BHD Tan Took Shing, Director and Geneia Manager CROWN CORK 4 SEAL (PNG) PTY LTD. Cliff I. Yarae, Director and General Manager SINGAPORE Jurong THAILAND Bangkok CROWN CORK 4 SEAL ISINGAPORF) CO. LTD. Graham S. Bell. Managing Director Tar. Kay Hoa financial Contiollar Lai Ka Wing. Regional Sales Manager CROWN CORK 4 SEAL (THAILAND) CO.. LTD. Terence D. Moore, Director and General Marager STOCK MARKET INFORMATION The Company's stock is listed and traded on the New York Stock. Exchange Price Range first Quarter Second Quarter Third Quarter Fourth Quarter 1990--High Low 57% 49Vz 63% 55% 67 53% 60% 49% 1989-High Low 51% 45% 52% 437a 57 46 56 46% The Company will file its Annual Report on Form 10-K with the Securities and Exchange Commission on or before March 31,1991. A copy of this Report may be obtained wtoout charge by any shareholder after March 31,1991. Requests for copies of the Report should be sent to: Corporate Secretary, Crown Cork & Seal Company, Inc., 9300 Ashton Road, Philadelphia, PA 19136. 19 i? PRODUCTS FABRICATED PRODUCTS Aerosoi Cans Beer and Beverage Cans 2 Piece Drawn and Ironed Steel and Aluminum 3 Piece Steel Easy Open Aluminum Ends Food Cans (Packers Cans) 3 Piece Steel 2 Piece Steel and Aluminum Fish Cans -- Tapered 2 Piece Meat Cans -- Rectangular & Pear Shape Infant Formula Cans 5 Gallon Square Cans Plastic Cans Easy Open Ends -- Steel and Aluminum Pet Food Cans Crowns Pry Off Twist Off Closures Aluminum (Pilfer Proof) Plastic Si eel Cone Top Cans "F" Style Rectangular Cans Motor Oil Cans Paint Cams MACHINERY Bottle Washers and Rinsers Bottle and Can Warmers Bottle Fillers for Beer Bottle Fillers for Carbonated Beverages Bottle Fillers for Non-Carbonatec Juice Can Fillers for Beer Can Fillers for Carbonated Beverages Can Fi lers tor Non-Carbonated Juice Casers ana Decase rs Crowners Conveyors for Bottles. Cans and Case Goods Process Equipment for Carbonated Beverages Blenders Carbonators Coolers De-aerators Palletizers tor Cans and Case Goods Depailetizers for Cans and Case Goods Can End Presses C'own Dust Removal Equipment troners tor D&l Can Making Liners Rolary Printers for D&l Can Making Spray Machines tor Can Making Trimmers for D&l Can Making Ultra Mark Date Coding Macnines DESCRIPTION OF "FE COMPANY S BLS NESS The Company's business is the manufacture and sale of metal cans, crowns and closures and the building ot filing, packaging and handling machinery. These products are manufactured in sixty-three (63) plants within the Uniled States and seventy-one (71) plants outside the United States and are sold through our own sales organization to the food, citrus, brewing, soft drink, oil, paint, toiletry, drug, antifreeze, chemical and pel loot! industries. REGtSTFAfl * TRANSFER AGENT FfsJ Chicago Trust Ccrrpany ol New York 30 West Broadway, New York. N.Y 10007-2192 Telephone Number 212-S&7-6515 INCOePORATED-STATE OF PENNSYLVANIA Crown Cork & Seal Company, Inc. 9300 Ashton Ron! Philadelphia, Pennsylvania 19136 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS OF COMMON STOCK 1991 NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Common Stock of CROWN CORK & SEAL COMPANY, INC. will be held at the Corporation's Office located at 9300 Ashton Road, Philadelphia, Pennsylvania, on the 25th day of April, 1991, at 11:00 A.M., lo elect Directors, and to consider and act upon the proposal lo amend the 1990 Stock-Based Incentive Com pensation Plan to increase the number of shares available for awards by 500,000 shares, which the Board of Directors unanimously recommends, to consider and act upon the proposal to amend the By-Laws to limit the liability of Directors under the Pennsylvania Business Corporation Law, which amendment is unanimously recommended by the Board of Directors, and to consider and act upon the proposal to adopt the Restricted Stock Plan for Non-Employee Directors, which the Board of Direc tors unanimously recommends, and transact such other business which may properly come before the meeting. The slock transfer books of the Corporation will not be closed prior to the Meeting, but only Shareholders of Common Stock of record as of (he dose of business on March 15,1991 will be entitled to vote. By Order of the Board of Directors RICHARD L. KRZYZANOWSK1 Executive Vice President, Secretary & General Counsel Philadelphia, Pennsylvania 19136 March 22. 1991 WE CORDIALLY INVITE YOU AND HOPE THAT YOU WILL ATTEND THE MEETING IN PERSON, BUT IF YOU ARE UNABLE TO ATTEND, THE BOARD OF DIRECTORS REQUEST THAT YOU SIGN AND RETURN WITHOUT DELAY, THE PROXY IN THE ENCLOSED ENVELOPE. Crown Cork & Seal Company, Inc. 9380 Ashton Rond Philadelphia, Pennsylvania 19134 PROXY STATEMENT -- MEETING, April 25,1991 To All Shareholders: The accompanying proxy is solicited by the Board of Directors of the Corporation for use id the Annual Meeting of Shareholders to be held on April 25, 1991 and, if properly executed, shares repre sented thereby will be voted by the named proxies or attorneys at such meeting. The expense for such solicitation will be borne by the Corporation. Certain officers and employees of the Corporation may also personally solicit proxies by mail, telephone, telegraph or personally, without any extra compen sation. A proxy may be revoked by a shareholder's voting in person at the meeting, or by giving written notice of revocation to the Secretary of the Company, or by executing and delivering a later dated proxy. The persons named as Proxies were selected by the Board of Directors of the Company and alt are Directors and Officers of the Company. There were outstanding on February 18, 1991, 28,877,715 shares of Common Stock. The Connelly Foundation of Philadelphia, Pennsylvania was the owner of 3,860,300 shares of Common Stock, constituting 13% of the class outstanding. CCL Industries Inc. of Ontario, Canada was the owner of 2,536,331 shares of Common Slock, constituting 8.8% of the class outstanding. CCL has agreed to vote such shares in accordance with the recommendations of the Board of Directors. J.P. Morgan & Co., Incorporated of New York, New York was the owner of 1,838,585 shares of Common Stock, constituting 6.3% of the class outstanding. These shares are being held for the benefit of various pension funds. Based on information contained in filings made with the Securities and Exchange Commission, sole voting power is reported with respect to 1,123,390 shares, sole dispositive power is reported with respect to 1,822,185 shares, and shared dispositive power is reported with respect to 16,400 shares. Shareholders of record as of March 15,1991 are entitled to one vote for each share then held. The presence, in person or by proxy, of Shareholders entitled to cast a majority of votes will be necessary to constitute a quorum for the transaction of business. Any stockholder giving a Proxy has the power to revoke it by written revocation delivered to the Corporate Secretary at any time before it is. voted. Proxies solicited herein will be voted, and if the person solicited specifies by means of the ballot provided in the Proxy a choice with respect to matters to be acted upon, the shares will be voted in accordance with such specification. The Annual Repent for the year ended December 31, 1990, containing audited financial state ments, is being mailed to Shareholders at the same time as this Proxy Statement, i.eon or about March 22, 1991. 2 ELECTION OF DIRECTORS The persons named in the proxy will vote the shares for the nominees listed below, all of whom are now Directors of the Corporation, to serve as Directors for the ensuing year, or until their succes sors shall be elected. None of the persons named as nominees for Directors have indicated that they will be unable or will decline to serve. In the event any of the nominees are unable or decline to serve, which the Management does not believe will happen, the persons named in the proxy will vote for the remaining nominees and others who may be selected by the Nominating Committee. The By-Laws of the Corporation provide for a variable number of Directors from 10 to 18. It is intended that the proxies will be voted for the election of the fourteen nominees named below as Directors, and no more than fourteen will be nominated. None of the nominees were, during the last five years, involved as a defendant in any legal proceedings which could adversely affect their capacity to serve as a member of the Board of Directors. The principal occupations staled below are the occupations which the nomi nees have had during the last five years. The names of the nominees and information concerning them and their associates as of February 18, 1991 as furnished by the nominees follows: Nan* Anaflt ini Patalift at Srcurilki of tb* Corporation Omet BcmflcUty, Dbwtiy or Year First _____ lndtrtgft-------- Age Frtacipat OccapatiM **"** Cmum Dtrasor ShlTCT PbthIiii William J. Avery*-*** SO Chairman of the Board, Presi 1979 58,000 dent and Chief Executive Of ficer .20% Henry E. Butwel* 62 Executive Vice President, Ad ministration and Chief Financial Officer 1975 59,000 .20% Francis X. Dalton 67 Former Treasurer, Retired 1987 26,127 .09% Francis J. Dunleavy** 76 Also Director of various compa nies 1980 1,200 .004% Chester C. Hilinski*-*** 73 Of Counsel, Dechert Price & Rhoads, Attorneys 1984 3,000 .01% Richard L. Krzyzanowski* 58 Executive Vice President, Sec retary and Genera] Counsel 1983 60,107 1 .21% Cordon S. Lang 65 Chairman of the Board and Chief Executive Officer of CCL Indus tries Inc. 1990 500 .0003% Owen A. Mandeville, Jr.** 56 President of Mandeville Insur 1975 83,600 ance Associates, Inc., real es tate and insurance consultants .29% Michael J. McKenna* 55 Executive Vice President; President. North American Division 1987 24,927 .09% 3 No** Frank N. Piasecki** PruKipat Ocnotioa Year First Became Dfttdor 71 Chairman of the Board and Pres ident of Piasecki Aircraft Corpo ration, a manufacturer of helicopters 1957 J. Douglass Scott 70 Former Chairman and Chief Ex ecutive Officer ofCrown Cork & Seal Canada, Lac., Retired 1973 Robert J. Siebert 70 Director and Retired President of CRC Chemicals Jnc., a mar keter of chemical specialties; management consultant 1966 Harold A.Sorgenti 56 Vice Chairman of Arco Chemi cal Corporation 1991 Edward P. Stuart*** 77 Retired Vice President of the Southern Division of the Corpo ration; management consultant 1964 All Officers and Directors of the Company as a Group of 34 including the above Anoint imt Ptraattg oT Sccuritie* of (he Cart***Jo*0*ac4 Bmeflcttly, Dntedy or Indirrrttr Cmztxm Sturm femalei* 157.500 .54% 6.000 .02% 26,200 .09% 100 .0003% 89.880 .31% 729.344 2.52% 1 Included in these shares are 2,400 shares held in custodian accounts for minor children. Also included are 6.400 shares owned by a charitable foundation of which Mr. Kr/yzanowski is one of three trustees. * Member of the Executive Committee. . ** Member of the Audit and Executive Salary Committee. *** Member of the Nominating Committee Not included in the table above are 3,860,300 shares of Common Stock owned by the Connelly Foundation, a charitable institution. Messrs. William I. Avery, Chester C. Hilinski and Owen A. Mandeville, Jr. are three of eleven Trustees of this Foundation and disclaim any beneficial own ership of these shares. Also not included are 173,000 shares of Common Stock owned by (he estate of John F. Connelly, of which Chester C. Hilinski and Owen A. Mandeville. ir. and his spouse are 3 of the 4 executors, and who disclaim any beneficial ownership of these shares. The Officers and Directors of the Company, in respect to the securities of the Corporation listed herein, have sole voting and investment power, except as to the shares of Connelly Foundation, in respect to which Messrs. Avery, Hilinski and Mandeville. as Trustees of an 11 member Board, have shared voting and investment power, and except as to shares owned by the estate of John F. Connelly in respect to which Messrs. Hilinski and Mandeville and his spouse have shared voting and investment power. 4 BOARD MEETINGS AND COMMITTEES In 1990, there were five regular meetings of the Board of Directors and three meetings of the Executive Committee. The Nominating Committee was only recently constituted and had no meetings in 1990. Directors who are not employees of the Company are paid $15,000 annually as Director's Fees. No additional fees are paid for attendance at meetings, unless the Directors are separately employed by the Company for auditing or other purposes. Each incumbent Director of the Company attended at least 15% of the aggregate meetings held by the Board of Directors and by the Commiuees on which he served. The Audit and Executive Salary Committee provides assistance to the Board of Directors in discharging its responsibilities in connection with the financial and accounting practices of the Com pany and the internal controls related thereto, and represents the Board of Directors in connection with the services rendered by the Company's independent accountants. The Committee is also respon sible for the review of Ihe executive salaries. The Nominating Committee recommends nominees for election tu the Board of Directors. Remuneration of Officers and Directors The following information for the year ended December 31, 1990, is supplied with respect to each of the five highest paid Executive Officers or Directors of the Corporation and Officers and Directors of the Corporation as a group. A Nttfte of Individual or number of pomas tagmop B CniMcttlet in which itmd c Cash wt cseJb- tuaitaktrt terms at rfMtratlwi Cl Sateria, Gets, directors* fen, toantbtion UdtMMM* in* Cl Vtinof Stan Msjgncd under Kiapioym' Stock OwursUp Pha CKSOP) ISM-1 **** John F. Connelly, deceased** Chairman of the Board $ 208,654 $ 1,500 William J. Avery Chairman of the Board, President and Chief $ 427,472 Executive Officer % 1,500 J. Douglass Scott Chairman and Chief Executive Officer of $ 216,558 Crown Cork & Seal Canada, Inc. -- Michael J. McKenna Executive Vice President; President North $ 169,889 American Division $ 1.500 Henry E. Butwel Executive Vice President, Administration and $ 158,585 Chief Financial Officer $ 1,500 All Officers of the Company as a Group of 34, including the above. $3,095,965 $25,694 * Value is based on the average per share market price of all shares purchased by the ESQP during each plan year. ** Mr. Connelly served as Chairman of the Board until his death on July 8, 1990. 5 Retirement Prqpim The Company maintains a Retirement Program for all non-union salaried employees providing for pension benefits. The pension plan provides benefits at age 65 based on the highest consecutive 5 years of base annual earnings in the last 10 years which produces the highest average annual earnings. These average earnings are multiplied by 1 V*% and by an additional V/* % of the earnings over $4,800, if the employee is a member of the contributory pension plan. This result is then multiplied by years of service, which results in the annual pension benefit. For illustration purposes, the following table shows various estimated maximum aggregate annual Company-provided retirement income payable to Officers and Directors who retire at age 65. Final Avtnce EmrioB* li Yean of Sow* 20 25 34 35 $ 50,000 $ 75.000. $100,000 $150,000 $250,000 $350,000 $450,000 $ 14,715 $ 22,365 $ 30,000 $ 45,270 $ 75,840 $106,410 $136,970 5 19,620 S 29,820 S 40,000 $ 60360 $101,120 $141380 $182,630 $ 24,525 $ 37,275 $ 50,000 $ 75,450 $126,400 $177340 $228,290 $ 29,430 $ 44,730 $ 60,000 $ 90,540 $151,680 $212,810 $273,940 $ 34.335 $ 52,185 S 70,000 $105,630 $176,960 $248,280 $319,600 Employees* Stock Ownership Plan The Company maintains the Crown Cork & Seal Company, Inc. Employees' Stock Ownership Plan ("ESOP"). All non-union salaried employees who have attained age 21 and completed three years of service are eligible to participate in the ESOP. The Company contributes 'h% (up to \'h% effective April 1, 1991) of each employees' earnings, which amount is used to purchase Company stock. Information concerning the Company's ESOP contribution for the five named Executive Officers, as well as for all Officers as a group, is included in Column C2 of the Remuneration table on page 5. The value of the contribution made on behalf of all employees under this plan for 1988, 1989 and 1990 was $290,656. Stock-Based Incentive Compensation Plans The following tables show, as to Executive Officers and Directors named in this Proxy Statement, as to Executive Officers as a group, and as to employees as a group, excluding Executive Officers, information regarding options granted and exercised since January 1, 1988 and regarding unexercised options held as of January I, 1991 under the Company's 1983 Incentive Stock Option Plan, 1984 Non-Qualified Stock Option Plan and 1990 Stock-Based Incentive Compensation Plan. 1983 Incentive Stack Option Plan: The Company maintains the 1983 Incentive Stock Option Plan ("1983 Plan''). Options for not more than 2,400,000 shares of common stock of the Company have been granted under the 1983 Plan to key Officers and employees of the Company and its subsidiaries. Options granted under the 1983 Plan do not have an option price less than the mean between the high and the low quoted selling prices for a share of the Company's common stock on the New York Stock Exchange on the dale of grant. No option could be granted under the 1983 Plan after December IS, 1988. P*je- 41 6 Nmm at lodLvidwl orNonker of Peruat in Group William J. Avery Henry E. Butwel John F. Gonnelly, deceased Michael J. McKenna J, Douglass Scott Executive Officers as a Group, including above All employees as a group, excluding Executive Officers Opivu Gnnttd 1-1-4* - 12-15-44 Tia.ee Annie Shorn t Xt Stock Per Short None -0 None OlftM Eatttitad 1-1-14 - 13-31-4* ltOwOf Net Vote Shorn r a# Scnittkt Common CUtrktoVihn tut Stack EmkIk Price) 12,000 11,625 $ 411,780 $ 374,287 Optea UreiaviMd to 1.1.41 No. ot Avenge Sham of Option Stack Price Per Shan None None -- -- None None None -- -- None 11,625 13400 $ 379,035 $ 503,010 None None None -- " None 218,895 $7,033,715 None -- 281,000 $40.06 1984 Non-Qualified, Stock Option Plan: The Company maintains the 1984 Non-Qualined Stock Op tion Plan (the "1984 Plan"). Options for not more than 660,000 shares of common stock of the Com pany have been granted to senior executives of the Company, including such executives who are also Directors. Approximately 30 such executives were eligible to receive options under the 1984 Plan. Options granted under the 1984 Plan shall have an option price of the closing price for a share of Company common stock on the New York Stock Exchange on the date preceding the date of grant. No option could be granted under the 1984 Plan after July 26, 1989. None of IndMdnel or Number of Penon ia Group William J. Avery Henry E. Butwel John F. Connelly, deceased Michael J. McKenna I. Douglass Scott Executive Officers as a Group, including above Option Granted 1.1-44 - 7-26-tt No. of Sham of Conuaao Sloth Average Option Met Per Shan None None -- None 15,000 None $47.50 -- 45,000 $42.71 Optioo* fcttoeted 1-1-44 - lt-31-94 NO. of Shorn of Cmonmb Stack Net Vote ofStrarilfat (Market Value Ui* Exil'd** Prkel 112,500 75,000 $ 3,379,625 $ 2,378,063 None 15,000 Nome $ 487425 -- 426,000 $13,157,465 Opttooi Uncxtoctocd to 1-1-91 No. or Skmci of Conunor Avenge Option Met Stock PerSkut None None -- - None 15,000 None - $47.50 - 48,750 S40.13 1990 Stock-Based Incentive Compensation Plan: The Company maintains the 1990 Stock-Based In centive Compensation Plan (the "1990 Plan"). Under the 1990 Plan, key employees may be awarded deferred stock, restricted stock, incentive stock options, non-qualified slock options or stock appreci ation rights ("SAR"), as designated by the Board to administer die 1990 Plan. Options granted under the 1990 Plan shall have an option price of not less than the fair market price of a share of Company Common Stock on the date of grant in the case of incentive stock options, and may be less than such fair market price in the case of non-qualified stock options. No incentive stock options, deferred stock, restricted stock, ot SARs have been granted under the 1990 Plan. Non-qualified stock options only were issued under this Plan, as follows: 7 Nine f luliriM or Number of PertMtiD Graoe William J. Avery Henry E. Butwel John F. Connelly, deceased Michael I. McKenna J. Douglass Scott Executive Officers as a Group, including above All employees as a group, excluding Executive Officers Option Granted 1.1.90 _ li-31-9* N*. of Shaft* at Ctmmtn Stack Avenge Option Price Pa-Share 50,000 25,000 $50% $50% None 25,000 None -- $50% 325,000 $50% 871,000 $50% Optioos Exercised 1-l-W - 11-31-9* No. of Shirt* of Cumin Steck Net Viee nr Securities (Merkel Value less Exercise Price! ---- ---- Options Ueraerrised _______ l 1-1-W No. of Shores of Cesmnon Stock Average Option Price Per Shore 50.CKXI 25,000 $50% $50% - - 25,000 $50% - - 325,000 $50% . 871,000 $50% PROPOSED AMENDMENT TO 1M0 STOCK-BASED INCENTIVE COMPENSATION PLAN The Board of Directors has approved and recommends to the Shareholders the adoption of an amendment to the 1990 Stock-Based Incentive Compensation Plan, described above (the "1990 Plan"), that would increase the number of shares of Common Stock available under the 1990 Plan by 500,000 to an aggregate of 2,000,000 shares, for awards with respect to stock options, stock appreciation rights, deferred stock and restricted stock. The Board of Directors believes that it is necessary to make more shares available for issuance under the 1990 Plan lo meet its foreseeable needs, especially because of the recent increase in the number eff key employees resulting from the Company's recent acquisition of Continental Can U.S. Beverage and Food divisions and the pending acquisition of Continental Can International operations. The 1990 Platt is of substantial benefit to the Company in attracting and retaining the services of key employees. Adoption of the amendment to the 1990 Plan requires a majority of votes cast hy Shareholders entitled to vote thereon. THE BOARD OF DIRECTORS OF CROWN CORK & SEAL COMPANY, INC. UNANIMOUSLY RECOMMENDS A VOTE "FOR" THIS PROPOSAL. PROPOSED AMENDMENT OF THE BY-LAWS The Board of Directors has approved and recommends to the Shareholders the adoption of an Amendment to the Company's By-Laws (the "Amendment") that would, to the extent permitted by the Pennsylvania Business Corporation Law, limit the personal liability of each Director of the Com pany for monetaiy damages arising out of breaches of such Director's fiduciary duty of care without changing the statutory obligation of such Director to conduct himself with care and due diligence. The proposed Amendment would limit the circumstances under which Directors (but not Direc tors in theii capacity as Officers or employees) could be held liable for monetary damages arising out of breaches of the duty of care. The duty of care is the fiduciary duty of Directors to be sufficiently 8 diligent and careful in informing themselves regarding, and in deciding whether to take or not to take, corporate action. The Amendment would not do away with the duty of care; it would only eliminate monetary damage awards occasioned by certain breaches of that duty. Thus, even ifthe Amendment is adopted, any breach of duly of care would remain a valid basis for a suit seeking to rescind a transac tion or seeking to enjoin a proposed transaction from occurring. After the transaction has occurred, however, the Shareholders would no longer have a claim for monetary damages against the Directors personally based on a breach of the duty of care, even if that breach involved negligence on their part as to important business matters, including acquisitions, mergers or takeover proposals. The Amendment would not eliminate or limit (i) Director liability based on self-dealing, willful misconduct or recklessness, {) liability pursuant to any criminal statute, tiii) liability for the payment of taxes pursuant to local, state, or federal law, (iv) liability under the federal securities laws, or (v) liability arising out of conduct or actions occurring prior to January 27, 1987, the effective date of the Pennsylvania Directors' Liability Act. The Company is not aware of any pending or threatened claims, or any basis for such, against any of the Directors. The Board of Directors approved the Amendment in order to supplement the indemnification protection presently provided to Directors by the Company's By-Laws and to assist in continuing to attract and retain highly qualified Directors. Although the Amendment limits the remedies available to Shareholders if they believe that a decision by the Board of Directors was not consistent with duties owed to the Shareholders, the Board believes that the diligence exercised by Directors stems primarily from their desire to act in the best interests of the Company and its Shareholders, and not horn a fear of damage awards. Consequently, the Board believes that the level of scrutiny and care exercised by Directors will not be Lessened by the adoption of the Amendment. ' Adoption of the Amendment requires the affirmative vote of Shareholders entitled to cast at least a majority of the votes which all Shareholders are entitled to cast on the proposal at the Annual Meeting. THE BOARD OF DIRECTORS OF CROWN CORK & SEAL COMPANY, INC. UNANIMOUSLY RECOMMENDS A VOTE "FOR" THIS PROPOSAL, PROPOSED RESTRICTED STOCK PLAN FOR NON-EMPLOYEE DIRECTORS The Board of Directors has adopted and recommends that the Shareholders approve the Crown Cork & Seal Company, Inc. Restricted Stock Plan for Non-Employee Directors (the "Plan"). Under the Plan, Non-Employee Directors will be granted shares of Common Stock ("Shares"), subject to the restrictions described below. The Ran is intended to encourage the highest level of performance of Non-Employee Directors and increase their proprietary interest in the Company. Eligibility and Grants. Upon approval of the Plan by the Shareholders, each Director who is not an officer or employee of the Company or of any of its subsidiaries or affiliates (an "Eligible Direc tor") will immediately receive 1,000 Shares (a "Gram"). Ten Directors will be so eligible to receive such Grants. Each Eligible Director who is subsequently elected to the Board will receive a Grant within 30 days after becoming an Eligible Director. Five years after receiving a Grant, and every fifth year thereafter, to the extent Shares remain available, each Eligible Director will receive an additional 9 Gnu*. The Shares granted under the Plan of the Company's Common Stock will be made available from the Company's authorized but unissued Common Stock or from Common Stock held in the treasury of the Company. The total number of shares of Common Stock available under the Flan is 25,000 (subject to adjustments for slock splits, stock dividends and the like). Terms and Caodttfoni of Grants. Upon the making of a Grant, five stock certificates, each representing 200 Shares, will be issued in the Eligible Director's name, but will be held in escrow by the Company. Each such certificate will bear a restrictive legend limiting the transferability of the Shares under the Plan. Simultaneously with the issuance of the stock certificates, the Eligible Director will be required to execute a stock power authorizing the Secretary of the Company to convey to the Company title to the Shares represented by the stock certificates. The Eligible Director will not be entitled to delivery of the stock certificates, and the Shares will be subject to certain restrictions as described in the Han. Subject to these restrictions, the Eligible Director will have the rights of a shareholder of Common Stock, including the right to receive dividends, if any, and the right to vote the Shares. The restrictions on the Shares will expire as to 20% of the Shares covered by each Grant on each anniversary date of such Grant, when certificates for the Shares representing such 20% por tion of a Grant will be distributed to the Eligible Director free of the foregoing restrictions. If a Director ceases to be as Eligible Director for any reason, including death, disability, or becoming an employee of the Company, a subsidiary or an affiliate, the Company will instruct the Secretary to convey the Shares to the Company thereby extinguishing the Director's rights as to such Shares. Any Shares forfeited by a Director shall again be available under the Plan. Administration. The Plan will be administered by a committee of the Company's Board of Direc tors comprised of three Directors who are not eligible to participate in the Plan. Termination or Amendment of the Flan. The Plan may be terminated or amended by the Board at any time, unless restricted by applicable law or unless Shareholder approval is required pursuant to the Plan. Adoption of the Plan requires a majority of votes cast by Shareholders entitled to vote thereon. THE BOARD OF DIRECTORS OF CROWN CORK St SEAL COMPANY, INC. UNANIMOUSLY RECOMMENDS A VOTE "FOR" THIS PROPOSAL. Proposals of Shareholders Proposals of Shareholders intended to be presented at the next Annual Meeting must be received in writing, via Certified Mail -- Return Receipt Requested, by the Office of the Secretary, Crown Cork & Seal Company, Inc., 9300 Ashton Road, Philadelphia, Pennsylvania 19136 not later than November 22, 1991. Relationship with Independent Accountants The firm of Price Waterhouse is the independent accountant for the most recently completed fiscal year, and has been selected by the Board to continue in that capacity for the current year. Price Waterhouse reviews quarterly information and performs annual audits of the Company's financial statements and assists the Company .in the preparation of federal tax returns. A representative or representatives of Price Waterhouse are expected to be prcsenl at the Annual Meeting and will have the opportunity to make a statement ifthey desire to do so. Such representatives are also expected to be available to respond to questions raised orally at the meeting or submitted in writing to the Office of the Secretary of the Company before the meeting. Sf 10 Other Matters The Board of Directors knows of no other matter which may be presented for Shareholders' action at the Meeting, but if other matters do properly come before the Meeting, or if any of the persons named above to serve as Directors are unable to serve, it is intended that the persons named in the proxy or their substitutes will vote on such matters and for other nominees in accordance with their best judgment. The Company will file its Annual Report on Form 10-K with the Securities and Exchange Com* mission on or before March 31, 1991. A copy of the Report, including the financial statements and schedules thereto and a list describing all the exhibits oot contained therein, may be obtained without charge by any Shareholder after March 31,1991. Requests for copies of the Report should be sent to: Corporate Secretary, Crown Cork & Seal Company, Inc., 9300 Ashton Road, Philadelphia, Pa. 1913b. Philadelphia, Pennsylvania 19136 March 22,1991 RICHARD L. KRZYZANOWSR1 Executive Vice President, Secretary & General Counsel 11