Company Name: Great Lakes Chemical Corp.
Public Availability Date: 02-22-1996
[INQUIRY LETTER 1]
GREAT LAKES CHEMICAL CORP.
P. O. BOX 2200
ONE GREAT LAKES BOULEVARD
WEST LAFAYETTE, INDIANA 47906
TELEPHONE(317) 497-6100
January 09, 1996
Mr. Vince Mathis
Attorney Advisor
Office of the Chief Counsel
Division of Corporate Finance
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Great Lakes Chemical Corporation Proxy Statement for
the 1996 Annual Meeting of Stockholders
Ladies and Gentlemen:
This statement and the accompanying materials are submitted on behalf of Great
Lakes Chemical Corporation ("GLCC"), pursuant to the provisions of Rule 14a-8(d)
of the Securities Exchange Act of 1934, as amended (the "Act"). Proposals
submitted by:
The Sisters of the Humility of Mary
Mercy Health Services
The Sisters of the Order of St. Dominic of Grand Rapids
The Sisters of St. Francis of Philadelphia
Progressive Asset Management (on behalf of the Educational Foundation of
America)
seek shareholder approval of a request that the Board of Directors provide a
comprehensive report on methyl bromide production. All of the above proposals
(Exhibit A) are identical and are referred herein collectively as the
"Proposals." In our opinion, the Proposals may be properly omitted from GLCC's
proxy materials for its 1996 Annual Meeting of Stockholders because they relate
to ordinary business operations, they deal with substantially the same subject
matter as a prior proposal, and they contain inaccurate and misleading
statements. We respectfully request that the Staff not recommend any enforcement
action if these Proposals are so omitted.
By copy of this letter, we are notifying all five proponents of GLCC's intention
to omit the Proposals and supporting statements from its proxy materials for its
1996 Annual Meeting of Stockholders.
BACKGROUND:
Methyl bromide is the most versatile and cost-effective fumigant available
today. Extremely effective as a soil, structural and commodity fumigant, methyl
bromide is heavily relied upon by fruit and vegetable growers in the United
States to control pests and provide higher yields. Methyl bromide is applied as
a structural fumigant to control wood-boring beetles and termites which damage
logs, wood products and wooden structures. Methyl bromide is also used to reduce
the risk of infestation in foods, machinery, and other commodity shipments for
international markets, enabling many of our U.S. export products to meet the
stringent import restrictions of foreign countries. Similarly, methyl bromide
fumigation of imports from other countries protects our own agricultural
industry from the accidental entry of potentially devastating foreign pests into
the United States.
Research over the past ten years indicates that various commercially popular
chemicals, including methyl bromide, may contribute to depletion of the ozone
layer in Earth's stratosphere. A thinner ozone layer may allow more ultraviolet
radiation into the lower atmosphere, possibly causing health problems for plants
and animals. In response, various national governments and industry developed
the Montreal Protocol on Substances that Deplete the Stratospheric Ozone (the
"Montreal Protocol"). In 1992, the members of the Montreal Protocol agreed to
freeze worldwide production of methyl bromide at 1991 levels. In 1993, the U.S.
Environmental Protection Agency (EPA), reflecting Montreal Protocol guidelines
for developed nations, listed methyl bromide as a Class I substance under the
Clean Air Act, and established a phase-out date of January 1, 2001, for emissive
uses. Because of the lack of viable alternatives and the importance of methyl
bromide to the U.S. economy, the EPA set the phase-out date at the statutory
maximum seven years from the listing date and included no intermediate
reductions prior to 2001. In December 1995, members rejected a proposal to phase
out methyl bromide worldwide in 2001, adopting instead a gradual phase out over
years 2001-2010. Individual nations are at liberty to adopt their own phase out
dates between 2001 and 2010.
In contrast to other chemicals regulated by the Montreal Protocol, significant
levels of methyl bromide are generated by nature. While the exact amount is not
known, up to 60% percent of the methyl bromide in the earth's atmosphere comes
from natural uncontrollable sources. Because of the continued uncertainty about
the role of man-made (which includes biomass burning) methyl bromide in the
ozone depletion, the parties to the Montreal Protocol have requested additional
information before proceeding beyond current levels of restriction.
Great Lakes joined the world's other methyl bromide producers in funding
research to more precisely determine the role of methyl bromide in ozone
depletion and to develop technology to significantly reduce the release of
man-made methyl bromide into the atmosphere. This program, including several
jointly funded projects with the National Aerospace Administration (NASA) and
the National Oceanic and Atmospheric Administration (NOAA), was planned with
input from the scientific and regulatory communities. Preliminary results by
scientists indicate that this research will provide the data necessary to
determine the actual role of methyl bromide in stratospheric ozone depletion. In
general, the results of this research indicate that methyl bromide is less of a
threat to the ozone layer than was previously believed.
GLCC has consistently supported the Montreal Protocol, complies with the Clean
Air Act and its Amendments, and actively participates in meetings, discussions
and research programs relating to ozone depletion and the potential effects of
man-made methyl bromide on the environment.
Great Lakes helped organize and fund the first scientific meeting to review
methyl bromide's possible role in ozone depletion. Methyl Bromide Science
Workshops were held in June 1992, October 1993, and June 1995. In attendance
were industry and governmental representatives, experts from various
universities and institutions, and other interested parties. They concluded that
the knowledge of bromine compounds in the atmosphere is significantly less
developed than that of chlorine compounds, and that the development and
evaluation of methyl bromide alternatives and substitutes lags far behind the
search for suitable replacements for chlorofluorocarbons, methyl-chloroform,
carbon tetrachloride, and halons.
In June of 1992, the United Nations Environmental Programme ("UNEP"),
established by the United Nations to consider the global impact of environmental
matters, sponsored a Technology and Economic Assessment (T&EA) workshop. The
attending scientists concluded that at that time there was no single alternative
to methyl bromide. Furthermore, the T&EA report stated that few methyl bromide
alternatives exist and those available have limited application capabilities, or
are not cost effective. While further work by the Technology and Economic
Assessment Panel and the associated Methyl Bromide Technical Options Committee
revealed "technically feasible" alternatives for some methyl bromide
applications, few commercially viable alternatives exist. GLCC has committed
substantial resources to the research and development of methyl bromide
substitutes, but to date has been unable to identify a suitable, cost-effective,
commercially-feasible alternative.
DISCUSSION:
1. The Proposals Relate to Ordinary Business Operations - Rule 14a-8(c)(7).
Rule 14a-8(c)(7) provides that a proposal may be omitted from a registrant's
proxy materials if it "deals with a matter relating to the conduct of the
ordinary business operations of the registrant." It is clear that a proposal
requesting the production of a report may be excluded if the subject of such
report involves a matter of ordinary business. Exchange Act Release No. 20091,
(August 16, 1983; Roosevelt v. E.I. Du Pont de Nemours & Co.,
958 F.2d 416 (D.C.
Cir. 1992).
Item 1. of the resolution in the Proposals would have GLCC publish confidential
information regarding its research and development efforts. With the phase-out
of methyl bromide for emissive uses scheduled for 2001, chemical producers are
working as quickly as possible to develop substitute fumigants. GLCC is also
committed to identifying suitable methyl bromide replacements. This is a matter
of ordinary business, and management should not be required to publish such
information, which could be extremely valuable to its competitors.
Items 2. and 3. of the resolution request that GLCC provide information
regarding any actions which may have been taken by management to extend or
eliminate the ban on methyl bromide, and on any payments made to organizations
working on the politics of same.
The Methyl Bromide Global Coalition ("MBGC") and the Methyl Bromide Working
Group ("MBWG") are supported by both methyl bromide producers and end-users. The
MBGC sponsors atmospheric research to better understand the involvement of
methyl bromide in processes such as ozone depletion, and the MBWG was formed to
ensure that both sides of the issue were fairly represented. GLCC's support of
these organizations falls within management's scope of responsibility for
administering the affairs of the Corporation and is ordinary business.
We believe that taking actions to ensure that the risk-benefit equation related
to the use or non-use of methyl bromide in the absence of suitable alternatives,
and to ensure that all of the facts related to the association of methyl bromide
with ozone depletion are known is a matter of ordinary business and good
management practices.
Item 4. of the resolution requests information on current or past litigation
associated with methyl bromide use. As most of the litigation related to methyl
bromide involves misuse (use not in compliance with the stringent labeling
instructions) or unprotected exposure (due to unauthorized access to treated
premises/areas), this is related to ordinary business, and is not pertinent to
the overall issue of ozone depletion. To the extent required by Item 103 of
Regulation S-K, such litigation will of course be described in GLCC's period
reports.
Item 5. calls for information on domestic and international production or
distribution after 2001. The Montreal Protocol and Clean Air Act both currently
restrict the production and distribution of methyl bromide now and after 2001.
As mentioned above, GLCC subscribes to the Montreal Protocol and is in full
compliance with the Clean Air Act. The implementation of these production and
distribution restrictions and future phase-out is a management matter related to
the conduct of ordinary business.
2. The Proposals Deal with Substantially the Same Subject Matter as a Prior
Proposal - Rule 14a-8(c)(12)(ii)
Rule 14a-8(c)(12)(ii) provides that a proposal may be omitted from a
registrant's proxy materials if it "deals with substantially the same subject
matter as a prior proposal submitted to security holders within the preceding
five years", provided that if at its second submission, it received less than
six percent of the total number of votes cast.
The Proposals deal with substantially the same subject matter, methyl bromide,
as prior proposals which were included in GLCC's proxy materials for its 1993
and 1994 Annual Meetings of Stockholders. (See Exhibit B.) Like the 1993 and
1994 shareholder proposals, the Proposals essentially address the perceived
negative effect of methyl bromide on the environment, and would require GLCC to
take action or provide information in excess of what is already required by the
Montreal Protocol or Clean Air Act. In 1993 and 1994, our stockholders
indicated, through their votes on this same issue, that they were not supportive
of any such additional action being taken. In 1994, when this proposal was
submitted for the second time, it received only 4.3% of the votes cast.
In order to be excluded under Rule 14a-8(c)(12), a later proposal need not be
identical to a prior proposal; it is enough that the thrust and direction of
both be the same. See the Staff's analysis under this rule in approving the
exclusion of a proposal (when the rule contained previous "substantially the
same proposal" wording) by Mobile Corporation (available March 2, 1981).
3. The Proposals Contain Several Inaccurate and Otherwise Misleading Statements
- Rule 14a-8(c)(3)
The Proposals submitted by the proponents in support of their request that our
Board "provide a comprehensive report on methyl bromide production" contain
statements misleading to those stockholders who are not well versed on the
methyl bromide issues or knowledgeable of the research which has been conducted
in this area.
The following statements in the Proposals will mislead those stockholders
unfamiliar with the subject matter. (Supporting technical information and
reference materials are attached as Exhibit C.)
The Proposals state that "methyl bromide is fifty times more destructive to the
stratospheric ozone layer than chlorine from chlorofluorocarbons (CFCs) atom per
atom." This statement is misleading in that it does not take into account the
fact that chlorine is far more abundant in the stratosphere than bromine. Nor
does it provide for balance by explaining that although bromine may contribute
to ozone losses observed over Antarctica, the ozone loss attributable to
fumigation activities is not more than about 6%.
Although the proponents cite "the elimination of worldwide use and production of
methyl bromide as the most significant approach to reducing ozone depletion,"
they fail to mention that the most significant step toward the elimination of
ozone depletion -- elimination of CFCs -- has already been implemented. They
also fail to include that observations have shown that large changes in methyl
bromide use do not result in measurable changes in atmospheric concentration,
indicating that reductions in methyl bromide use would have no measurable effect
on atmospheric levels, and therefore no effect on recovery of the ozone layer.
This omission renders their statement misleading.
The statement that "methyl bromide is regulated under the Clean Air Act and is
classified by the Environmental Protection Agency (EPA) as a Category I Acute
Toxin, the most deadly category of substance" is inaccurate. The EPA places
pesticides in Toxicity Category I, II, III, or IV to denote the level of
protection required for use and handling of the product. Category I requires the
highest level of protection and very specific warning language on the label. As
a result, injury rates for Category I products, including methyl bromide, are
typically lower than for "less toxic" pesticides. The use of the word "deadly"
implies that any exposure or contact with the chemical will kill, ignoring the
mandated safety precautions that enable methyl bromide to be used safely.
Although, "manufacturers must cease domestic production of methyl bromide by
January 1, 2001" under the U.S. Clean Air Act, this restriction only applies to
methyl bromide which is emitted to the atmosphere. Production of methyl bromide
for use as a chemical intermediate (non-emissive use), for example, may
continue. (The Proponents subsequently agreed to revise this statement so that
it refers only to production of methyl bromide for emissive use.)
While it is true that the Clean Air Act does not regulate the use of methyl
bromide, the statement that the "use of methyl bromide stockpiles, however, may
continue indefinitely," is misleading. UNEP projections of ozone depletion
assume maximum production allowed under current regulations. "Stockpiles" would
have no impact on these projections, as all material, whether produced and used
or produced and stockpiled, is already included in these projections. The future
use of any stockpiled material would therefore not cause additional ozone
depletion.
The statements that "cost-effective, non-chemical alternatives to methyl bromide
already exist" and that "the UN reports that for over 90 percent of current uses
of methyl bromide, alternatives are already either commercially available or in
an advanced stage of development" are grossly misleading. UNEP established a
committee to "address the technical availability of chemical and non-chemical
alternatives for the current uses of methyl bromide," but neither
cost-effectiveness nor commercial availability were considerations. In fact,
this committee stated that it "did not identify a technically feasible
alternative, either currently available or at an advanced stage of development,
for less than 10% of 1991 methyl bromide use." Thus, the proponents' statement
that "for 90% of ... uses ..., alternative are ... commercially available," is
misleading.
Although "the US Department of Defense has implemented non-chemical alternative
technologies and has found them to be economical and effective," its experience
was limited to the use of controlled environments (temperature, humidity,
atmospheric composition) for shipment of commodities to military bases worldwide
and does not suggest that such alternatives are widely applicable. This
statement is therefore also misleading.
The statement that "numerous scientific studies have shown that Ultraviolet-B
radiation exposure, which increases as the ozone layer thins, is known to cause
immune suppression, cataracts and skin cancer in humans and animals, and damage
crops and a variety of other key organisms on the planet" is presented as if a
relationship between ozone depletion, UV radiation, and biological effects has
been firmly established. However, because of the absence of long-term surface UV
level monitoring, no long-term trend has yet been established. The proponents'
statement is therefore misleading as there is little proof of any relationship
between UV exposure and the listed biological effects.
As presented, the proponent's statement that "a direct exposure to methyl
bromide can cause acute health effects and death" implies that "any" exposure or
contact would be lethal. However, published reviews indicate that humans would
have to be exposed to methyl bromide in the air in the range of from 1.5 hours
(at a concentration of 8,000 ppm) to 10-20 hours (at a concentration of 1,500
ppm) for exposure to be life-threatening. Also, methyl bromide does not
accumulate in the body and recovery from exposure to less than lethal
concentrations is usually rapid and complete. More importantly, there are no
adverse health effects when methyl bromide is handled in accordance with label
precautions and instructions.
According to the Annual California Pesticide Illness Surveillance Program
Summary Reports for the years 1985-1993, 10 (not "15") fatalities were
attributed to methyl bromide in this time period. All of these deaths occurred
in homes or apartments which had been fumigated, tarped and secured properly.
However, all of the victims (except two) had entered the fumigated buildings
illegally while burglarizing, breaking and entering, seeking shelter from the
cold, or cutting through the tarps of their own residential units before reentry
was authorized. Of the two exceptions, one was a chronic alcoholic who died of
liver complications four months after the alleged methyl bromide exposure.
There are no data supporting the claim that exposure to methyl bromide causes
"birth defects and inheritable defects." In fact, a 1994 review by a panel of
experts (the Developmental and Reproductive Toxicant Identification Committee of
the California Office of Environmental Health Hazard Assessment) concluded that
"Methyl bromide has not been clearly shown to cause developmental or
reproductive toxicity..."
The UNEP definition of anthropogenic (man-made) methyl bromide, which includes
biomass burning (African savannas, rain forest clearing) and gasoline additives,
does not support the proponents' statement that "30-40% of the bromines reaching
the stratosphere came from natural emissions." According to UNEP natural sources
still account for 54-59% of total emissions, not the 30-40%. More realistically,
emissions which could be controlled by a ban on methyl bromide production
(emissive uses - agricultural and structural) account for only 22-24% of total
emissions.
The proponents stated that "in a 1/17/95 letter to members of the Methyl Bromide
Working Group (financed by the chemical industry) Peter Sparber states: `Whether
or not EPA meets (our) demands, we intend to change the law which allows EPA to
ban methyl bromide." This statement contains two inaccuracies. The letter was
not addressed to the Methyl Bromide Working Group, but was sent to methyl
bromide users and other interested parties. It was sent on January 12, 1995 and
not on 1/17/95 as indicated. As the Methyl Bromide Working Group receives
funding from several sources, the statement that it is "financed by the chemical
industry is misleading.
4. If the Proposal is Substantially Duplicative of a Proposal Previously
Submitted to the Registrant by Another Proponent - Rule 14a-8(c)(11)
The Proposals are identical. The reasons for excluding each proposal are also
identical. If the Commission disagrees with all of GLCC's reasons for omitting
the Proposals, GLCC should not be required to include the same language five
times in its proxy materials.
CONCLUSION:
For the reasons stated above, GLCC believes that the Proposals may be omitted
from GLCC's proxy materials for its 1996 Annual Meeting pursuant to Rule
14a-8(c), and requests that the staff advise GLCC that it will not recommend any
action to the Commission if they are so omitted.
Five copies of this letter are enclosed in accordance with Rule 14a-8(d). If you
have any questions or desire any further information or documentation with
respect to any of the matters set forth herein, please contact me at
317/497-6375.
Sincerely,
Mary P. McClanahan
MPM/Attachments
Exhibit A - Five Submitted Proposals
Exhibit B - GLCC's 1993 and 1994 Proxy Statements
Exhibit C - Management's Supporting Documentation
Additional five copies of letter and attachments
[INQUIRY LETTER 2]
SISTERS OF THE HUMILITY OF MARY
1515 EASTERN AVENUE
MORGANTOWN, WEST VIRGINIA 26505
TELEPHONE(304) 598-3075
November 15, 1995
Mr. Robert B. McDonald, CEO
Great Lakes Chemical Corporation
P.O. Box 2200, Highway 52 NW
West Lafayette, IN 47906
Dear Mr. McDonald:
We continue to be concerned about the environmental impact and biohazard risk of
Great Lakes Chemical's products, by-products and industrial processes. We
applaud the establishment earlier this year of a new executive committee for
Oversight on Environment, Safety and Health and the commitment to Responsible
Care Principles.
Nevertheless, we believe these efforts must be complemented by significant
actions. We are particularly concerned about environmental disclosure and
accountability for the risks to the human community. But as shareholders, we are
also concerned with the long-term environmental costs and liability that will
impact on our company.
Therefore we are joining with other religious and institutional shareholders in
requesting a comprehensive report as specified in the accompanying resolution.
The Sisters of the Humility of Mary are the beneficial owners of 100 shares of
Great Lakes stock. The stock has been owned since 1992. Verification of
ownership is enclosed and the Sisters intend to hold the stock at least until
the next annual meeting.
We are authorized to notify you of our intention to cofile this resolution for
consideration and action by the stockholders at the annual meeting. We submit it
for inclusion in the proxy statement in accordance with rule 14a-8 of the
general rules and regulations of the Securities and Exchange Act of 1934. We
would appreciate your indicating in the proxy statement that we are a sponsor of
this resolution.
Sincerely yours,
Madonna Kolbenschlag, HM
HM Investment Review Committee
Peter Lauer, Finance Director
Sisters of the Humility of Mary
[INQUIRY LETTER 3]
MERCY HEALTH SERVICES
54605 TWELVE MILE ROAD
FARMINGTON HILLS, MICHIGAN 48331-3221
TELEPHONE(810) 489-6000
November 17, 1995
Robert B. McDonald
Chair, President & CEO
Great Lakes Chemical
1 Great Lakes Blvd.
W. Lafette, Indiana 47906
Dear Mr. McDonald:
Mercy Health Services (MHS) are owners of 1,700 shares of Great Lakes Common
Stock. Primarily involved in health care and education, MHS is very concerned
about the continued use and detrimental effects that methyl bromide has on the
environment. As stockholders we urge the companies in which we invest to act in
a socially responsible manner.
I am authorized to notify the company through this letter of our sponsorship of
the enclosed resolution. I present it for inclusion in the proxy statement for a
vote at the next stockholders meeting in accordance with Rule 14a-8 of the
General Rules and Regulations of the Securities Exchange Act of 1934. We are
filing this resolution along with other concerned investors. Your primary
contact for this filing is Sr. Ann Walter, Grand Rapids Dominican Sisters, Grand
Rapids, MI.
Proof of ownership of shares of common stock in our company for at least the
last twelve months is attached. We will continue to hold shares in the company
through the date of the annual stockholders meeting. There will be a
representative present at the meeting to present this resolution.
It is our tradition, as a religious institutional investor, to seek dialogue
with companies to discuss the issues involved in these resolutions. We hope that
a dialogue of this sort is of interest to you as well. If so, please advise Sr.
Ann Walters.
Sincerely,
James H. Combes
Executive Vice President & CFO
Enc.
cc: Ann Walters, O.P.
Interfaith Center on Corporate Responsibility
JHC/IL/bkp
[INQUIRY LETTER 4]
GRAND RAPIDS DOMINICANS
2025 E. FULTON STREET
GRAND RAPIDS, MICHIGAN 49503-3895
TELEPHONE(616) 459-2910
November 28, 1995
Mr. Robert B. McDonald
Chair, President & CEO
Great Lakes Chemical
PO Box 2200
West Lafayette, IN 47906
Dear Mr. McDonald:
Please include the enclosed proposal in the Company's Proxy Statement and form
of Proxy relating to the 1996 annual Meeting of Stockholders of Great Lakes
Chemicals.
Also enclosed is certification from our Custodian Grand Bank of our holdings of
1200 shares in Great Lakes Chemical and the fulfillment of the share amount at
time requirements of SEC Rule 14a-8. The Sisters of the Order of St. Dominic of
Grand Rapids intend to fulfill all requirements of Rule 14a-8 including holding
the requisite amount of equity through the date of the 1996 meeting.
There will be other religious socially conscious investors co-filing the
enclosed resolution.
This resolution is asking the Board of Directors to provide a comprehensive
report on methyl bromide production. We would also welcome the opportunity to
discuss in more detail our concerns as stated in the resolution.
Sincerely,
Ann Walters, OP
Sisters of the Order of St. Dominic of Grand Rapids
AW:meb
cc: Adriane Van Buren, ICCR
Margaret Weber, Groundwork
ENCLOSURES: Resolution
Proof of Shares
[INQUIRY LETTER 5]
THE SISTERS OF ST. FRANCIS OF PHILADELPHIA
OUR LADY OF ANGELS CONVENT - GLEN RIDDLE
ASTON, PENNSYLVANIA 19014
TELEPHONE(610) 459-4125
November 22, 1995
Mr. Robert B. McDonald
Chair, President & CEO
Great Lakes Chemical
PO Box 2200
West Lafayette, IN 47906
Dear Mr. McDonald
The Sisters of St. Francis are greatly concerned about the insidious destruction
of the stratospheric ozone layer and all the implications that holds for our
people now, and in future generations.
Through this letter we are notifying the company of our intention to co-file the
enclosed resolution with the Srs. of St. Dominic of Grand Rapids Michigan and
present it for inclusion in the proxy statement for consideration and action by
the shareholders at the next stockholders meeting in accordance with rule 14-a-8
of the General Rules and Regulations of the Securities Exchange Act of 1934. We
would appreciate your indicating in the proxy statement that we are a sponsor of
the resolution. A representative of the filers will attend the stockholders'
meeting to move the resolution as required by the SEC Rules. We will continue to
hold shares ion the company through the time of the stockholders' meeting. Proof
of ownership is enclosed.
It is our tradition as religious investors to seek dialogue with companies to
discuss the issues involved with the hope that the resolution might not be
necessary. We trust that a dialogue of the sort is of interest to you as well.
Sincerely,
Doris Gormley, osf
Director, Corporate Social Responsibility
cc: Ann Walters, OP
Ariane VanBuren, ICCR
Diane Bratcher, ICCR
enclosures
[INQUIRY LETTER 6]
PROGRESSIVE ASSET MANAGEMENT
1814 FRANKLIN STREET, SEVENTH FLOOR
OAKLAND, CA 94612
TELEPHONE(510) 834-3722
November 29, 1995
Robert B. McDonald
Chair, President & CEO
Great Lakes Chemical Corp.
1 Great Lakes Blvd.
West Lafayette, IN 47906
Dear Mr. McDonald:
Progressive Asset Management is a brokerage firm specializing in socially
responsible investing. We seek out companies for our clients who have
distinguished themselves in environmental practices, employee relations, product
reliability, community involvement, human rights and other areas.
Our client, the Educational Foundation of America, is concerned about the
environmental impact of methyl bromide and the search for safe alternatives to
this product. Through this letter we are notifying the company of our
co-sponsorship of the enclosed resolution asking the company to provide a
comprehensive report on methyl bromide production. Grand Rapids Dominicans are
main filers of the resolution; Progressive Asset Management is a co-filer.
We present the resolution for inclusion in the proxy statement for a vote at the
next stockholders meeting in accordance with rule 14-a-8 of the General Rules
and Regulations of the Securities Exchange Act of 1934.
Proof of our client's ownership of shares of common stock in our company for at
least the last twelve months is attached. It is our client's intent to maintain
ownership of these shares through the date of the 1996 annual meeting.
Sincerely,
Conrad MacKerron
Director, Social Research
SHAREHOLDER RESOLUTION
GREAT LAKES CHEMICAL
WHEREAS methyl bromide is used principally as a fumigant to control a wide range
of pests, weeds and seeds in soil. According to the United Nations Environment
Programma (UNEP) bromine from methyl bromide is fifty times more destructive to
the stratospheric ozone layer than chlorine from chlorofluorocarbons (CFCs) atom
per atom.
UNEP cites the elimination of worldwide use and production of methyl bromide as
the most significant approach to reducing ozone depletion.
methyl bromide is regulated under the Clean Air Act and is classified by the
Environmental Protection Agency (EPA) as a Category I Acute Toxin, the most
deadly category of substances. Methyl bromide is also classified as Class I
Ozone Depleter. Manufacturers must cease domestic production of methyl bromide
by January 1, 2001. Use of methyl bromide stockpiles, however, may continue
indefinitely.
cost effective, non-chemical alternatives to methyl bromide already exist. The
UN reports that for over 90 percent of current uses of methyl bromide,
alternatives are already either commercially available or in an advanced stage
of development. The US Department of Defense has implemented non-chemical
alternative technologies and has found them to be economical and effective. Most
chemical alternatives will be even more dangerous than methyl bromide.
numerous scientific studies have shown that Ultraviolet-B radiation exposure,
which increases as the ozone layer thins, is known to cause immune suppression,
cataracts and skin cancer in humans and animals, and damage crops and a variety
of other key organisms on the planet.
direct exposure to methyl bromide can cause acute health effects and death. In
California since 1985 at least 15 deaths have been attributed to exposure to
methyl bromide. Exposure causes damage to the central nervous system, the lungs,
kidneys, eyes and skin, and is responsible for some birth defects and
inheritable defects.
until recently, scientists believed that 30-40% of the bromines reaching the
stratosphere came from natural emissions such as oceans and other salty bodies
of water. However, research from the national Oceanic and Atmospheric
Administration (NOAA) suggests that oceans absorb more bromide than they release
(Science, Vol. 267, 2/17/95, pgs. 1002-1005).
in a 1/17/95 letter to members of the Methyl Bromide Working Group (financed by
the chemical industry) Peter Sparber states: "Whether or not EPA meets (our)
demands, we intend to change the law which allows EPA to ban methyl bromide."
RESOLVED: That shareholders request the Board of Directors to provide a
comprehensive report on methyl bromide production including: 1. development of
chemical alternatives to methyl bromide, 2. efforts our company has made to
extend or eliminate the ban on methyl bromide, 3. any payments to the Methyl
Bromide Working Group or similar trade organizations working on the politics of
the phase-out, 4. current or past litigation due to damages caused by methyl
bromide, 5. plans for domestic or international production or distribution after
2001. This report to be prepared at reasonable cost, omitting proprietary
information, and available to shareholders by August 1, 1996.
[STAFF REPLY LETTER]
February 22, 1996
RESPONSE OF THE OFFICE OF CHIEF COUNSEL
DIVISION OF CORPORATION FINANCE
Re: Great Lakes Chemical Corporation (the "Company")
Incoming letters dated January 9, 1996
The Company received five proposals requesting the board of directors to provide
a comprehensive report on methyl bromide production.
There appears to be some basis for your view that the proposals may be omitted
from the Company's 1996 proxy materials under Rule 14a-8(c)(12)(ii) as dealing
with substantially the same subject matter as prior proposals, submitted at two
meetings during the last five years (i.e. methyl bromide production), which
received at the time of its latest submission, less than six percent (6%) of the
total number of votes cast. Accordingly, the Division will not recommend any
enforcement action to the Commission if the Company omits the subject proposals
from its proxy materials in reliance on Rule 14a-8(c)(12)(ii). In reaching a
position, the staff has not found it necessary to address the alternative bases
for omission upon which the Company relies.
Sincerely,
Andrew A. Gerber
Attorney-Advisor
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