CENTRAL SECURITIES CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
March 12, 2003
NOTICE is hereby given that the Annual Meeting of Stockholders of Central
Securities Corporation will be held at The University Club, One West 54th
Street, 9th Floor, New York, New York on Wednesday, March 12, 2003 at 11 A.M.,
for the following purposes:
1. To elect a board of five directors;
2. To act upon a proposal to ratify the selection of KPMG LLP as
independent auditors for the Corporation for the ensuing year; and
3. To act upon such other matters as may properly come before the
meeting.
The Board of Directors has fixed the close of business on January 24, 2003
as the record date for the determination of stockholders entitled to notice of
and to vote at the meeting, and only stockholders of record on such date are
entitled to vote on these matters at the meeting or any adjournment thereof.
By order of the Board of Directors
MARLENE A. KRUMHOLZ
Secretary
New York, New York
February 5, 2003
A proxy is enclosed with this Notice and Proxy Statement. Please complete,
SIGN and promptly return your proxy in the enclosed envelope. This will assure a
quorum and save further solicitation costs.
PROXY STATEMENT
---------------
February 5, 2003
CENTRAL SECURITIES CORPORATION
375 PARK AVENUE
NEW YORK, NEW YORK 10152
(Tel. No. 212-688-3011)
This Proxy Statement and the enclosed proxy card are first being mailed to
stockholders on or about February 5, 2003 in connection with the solicitation of
proxies by the Board of Directors of Central Securities Corporation (the
"Corporation") for use at the Annual Meeting of Stockholders of the Corporation
to be held on March 12, 2003, or any adjournment thereof (the "Meeting").
Properly executed proxies received by the Corporation prior to the Meeting will
be voted in accordance with the specific voting instructions indicated on the
proxy. If no instructions are specified, the shares will be voted for the
nominees for director and in favor of proposal (2). Any proxy may be revoked at
any time before it is exercised at the Meeting by the delivery or mailing of
written notice to the Secretary of the Corporation, by executing and delivering
a later-dated proxy or by appearing and voting in person by ballot at the
Meeting.
The record date for stockholders entitled to vote at the Meeting is the
close of business on January 24, 2003. On that date, the Corporation had
outstanding 19,327,284 shares of Common Stock.
The holders of the Corporation's Common Stock shall be entitled to one
vote per share. The presence, in person or by proxy, of a majority of the issued
and outstanding stock of the Corporation shall constitute a quorum for the
transaction of business at the Meeting.
SHARE OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, OF
NOMINEES FOR ELECTION TO THE BOARD OF DIRECTORS,
AND OF EXECUTIVE OFFICERS
The following table sets forth information as of December 31, 2002
regarding the share ownership of each person who is known to the Corporation to
have been a beneficial owner of more than five percent of the Common Stock of
the Corporation, of each nominee for election to the Board of Directors of the
Corporation, and of all directors and executive officers as a group:
Name of Nominee to
the Board of Directors Amount and
or Name and Address Nature of Beneficial Percent
of Beneficial Owner Ownership(1) of Class(2)
---------------------- -------------------- ----------
Donald G. Calder* ....................... 64,289(3)
Jay R. Inglis* .......................... 1,527
Christian A. Johnson
Endeavor Foundation(4) ................ 6,793,146 35.1
1060 Park Avenue
New York, New York 10128
Dudley D. Johnson* ...................... 40,444(5)
Wilmot H. Kidd* ......................... 2,206,449(6)(8) 11.4
375 Park Avenue
New York, New York 10152
Mrs. Wilmot H. Kidd ..................... 2,206,449(6)(8) 11.4
1060 Park Avenue
New York, New York 10128
C. Carter Walker, Jr.* .................. 488,331(7)(8) 2.5
All directors and officers
as a group ............................ 2,418,452(8) 12.5
----------
* Indicates nominee for election to the Board of Directors.
(1) Except as otherwise indicated, to the Corporation's knowledge the
beneficial owner had sole investment power and sole voting power with respect to
the shares shown opposite the name of such beneficial owner.
(2) As calculated on the basis of 19,337,284 shares of Common Stock
outstanding on December 31, 2002, Messrs. Calder, Inglis and Johnson each owned
less than 1% of the outstanding Common Stock.
(3) Includes 13,263 shares of Common Stock owned by Mr. Calder's wife or
held for the benefit of their children and 8,089 shares of Common Stock owned by
the Donald Grant and Ann Martin Calder Foundation (the "Calder Foundation"). Mr.
Calder is the President and Treasurer of the Calder Foundation. He disclaims
beneficial ownership of all such shares.
(4) Mrs. W. H. Kidd, whose husband is the President of the Corporation, is
President and Trustee of the Christian A. Johnson Endeavor Foundation.
(5) Includes 17,588 shares of Common Stock held in the Young & Franklin
Inc. Retirement Income Trust of which Mr. Johnson is trustee and 1,142 shares of
Common Stock held by the Disosway Foundation. Mr. Johnson is the Trustee of the
Disosway Foundation. He disclaims beneficial ownership of all such shares.
(Footnotes continued on following page)
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(Footnotes continued from previous page)
(6) An aggregate of 2,206,449 shares of Common Stock were included in the
shares beneficially owned by each of Mr. and Mrs. Kidd. The shares set forth for
each of Mr. Kidd and Mrs. Kidd include 365,258 shares of Common Stock owned by
Mr. Kidd as to which Mr. and Mrs. Kidd had shared investment power and shared
voting power and as to which Mrs. Kidd disclaims beneficial ownership; 842,678
shares of Common Stock owned by Mrs. Kidd or held in trusts for her benefit as
to which Mr. and Mrs. Kidd had shared investment power and shared voting power
and as to which Mr. Kidd disclaims beneficial ownership; and 972,588 shares of
Common Stock owned by Mr. and Mrs. Kidd's children or held in trusts for their
benefit or for the benefit of other family members as to which Mr. and Mrs. Kidd
had shared investment power and shared voting power and as to which Mr. and Mrs.
Kidd disclaim beneficial ownership. The shares set forth for each of Mr. and
Mrs. Kidd also include 25,925 shares of Common Stock held in trust for the
benefit of the children of Mr. C. Carter Walker, Jr. as to which Mr. Kidd had
shared investment power and shared voting power and as to which Mr. and Mrs.
Kidd disclaim beneficial ownership.
(7) Includes 55,189 shares of Common Stock owned by Mr. Walker's wife or
held in trusts for the benefit of their children as to which Mr. Walker had
shared investment power and shared voting power, 25,925 shares of Common Stock
held in trust for the benefit of his children as to which Mr. Walker had no
voting or investment power, and 356,663 shares of Common Stock held in trust for
the benefit of Mrs. Wilmot H. Kidd or her children as to which Mr. Walker had
shared investment power and shared voting power. Mr. Walker disclaims beneficial
ownership of all such shares.
(8) An aggregate of 382,588 shares of Common Stock were included in the
shares beneficially owned by each of Mr. Kidd, Mrs. Kidd, and Mr. Walker.
The share ownership of Wilmot H. Kidd, President of the Corporation, is
given above. No other executive officer of the Corporation owns, beneficially or
otherwise, any shares of stock of the Corporation.
VALUE OF BENEFICIAL SHARE OWNERSHIP BY DIRECTORS
The dollar range of the value of equity securities of the Corporation
beneficially owned by each director as of December 31, 2002 is as follows:
Dollar Range of
Independent Directors Share Ownership
-------------------- --------------
Donald G. Calder Over $100,000
Jay R. Inglis $10,001 - $50,000
Dudley D. Johnson Over $100,000
C. Carter Walker, Jr. Over $100,000
Interested Director
-------------------
Wilmot H. Kidd Over $100,000
3
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors, executive officers and persons who own more than ten
percent of a registered class of the Corporation's equity securities to file
with the Securities and Exchange Commission (the "SEC") initial reports of
ownership and reports of changes in ownership of Common Stock of the
Corporation. Officers, directors and greater than ten percent beneficial owners
are required by SEC regulation to furnish the Corporation with copies of all
Section 16(a) forms they file.
To the Corporation's knowledge, based solely on review of copies of such
reports furnished to the Corporation and written representations that no other
such reports were required, all Section 16(a) filing requirements applicable to
its officers, directors and greater than ten percent beneficial owners were
complied with.
VOTING PROCEDURES
The election of directors requires the affirmative vote of a plurality of
the shares of Common Stock present in person or represented by proxy at the
Meeting and entitled to so vote. Shares of Common Stock represented by proxies
which are marked "withhold authority" with respect to the election of any one or
more nominees for election as director will not be voted with respect to the
nominee or nominees so indicated. The ratification of the selection of
independent auditors of the Corporation requires the affirmative vote of a
majority of the shares of Common Stock present in person or represented by proxy
at the Meeting and entitled to so vote. Shares of Common Stock represented by
proxies which are marked "abstain" with respect to this matter will be counted
for the purpose of determining the number of shares present and entitled to
vote, and shall therefore have the same effect as if the shares represented
thereby were voted against such matter. Broker non-votes (where a nominee
holding shares for a beneficial owner has not received voting instructions from
the beneficial owner and such nominee does not possess or choose to exercise his
discretionary authority with respect thereto) will be treated as present but not
entitled to vote at the Meeting for the purpose of determining the number of
votes needed with respect to each item to be voted upon, and shall therefore
have no effect on such vote.
PROPOSAL 1. ELECTION OF DIRECTORS
The Board of Directors recommends the election of five directors to hold
office until the next Annual Meeting of Stockholders and until their successors
are elected and qualified. If any nominee for director is unable or declines to
serve, for any reason not now foreseen, the discretionary authority provided in
the proxy will be exercised to vote for a substitute. All the nominees have
consented to become directors and all were elected at the last Annual Meeting of
Stockholders.
Duly authorized proxies for Common Stock will be voted for the election of
Mr. Donald G. Calder, Mr. Jay R. Inglis, Mr. Dudley D. Johnson, Mr. Wilmot H.
Kidd and Mr. C. Carter Walker, Jr.
4
The following table indicates the age, principal occupations during the
last five years and positions (if any) with the Corporation, and the year each
nominee was first elected to the Board of Directors:
Principal Occupations Director of
(last five years) Corporation
and Position (if any) Continuously
Nominee Age with the Corporation Since
------- --- --------------------- ------------
Independent Directors:
Donald G. Calder .......... 65 President, G. L. Ohrstrom & Co., Inc. (private 1982
investment firm); Director of Brown-Forman
Corporation, Carlisle Companies Incorporated
and Roper Industries, Inc. (manufacturing
companies)
Jay R. Inglis ............. 68 Executive Vice President, National Marine 1973
Underwriters (insurance management company)
since 2001; Executive Vice President, Holt
Corporation (insurance holding company)
prior thereto
Dudley D. Johnson ......... 63 President, Young & Franklin Inc. (private 1984
manufacturing company)
C. Carter Walker, Jr. ..... 68 Private Investor 1974
Interested Director:
Wilmot H. Kidd ............ 61 Investment and research - President, Central 1972
Securities Corporation
The address of each nominee is c/o Central Securities Corporation, 375
Park Avenue, New York, New York 10152.
The Board of Directors had ten regular meetings in 2002. The Board of
Directors has an Audit Committee consisting of Messrs. Calder, Inglis, Johnson
and Walker. The members of the Audit Committee are independent as defined in
Section 121(A) of the American Stock Exchange's listing standards. The Board of
Directors does not have a Compensation Committee or a Nominating Committee. All
directors attended at least 75% of the aggregate of all meetings of the Board of
Directors and the committees on which they served.
The Board of Directors amended the written charter for the Audit Committee
(the "Charter") on January 29, 2003. A copy of the Charter is attached to this
proxy statement as Exhibit A. Pursuant to the Charter, the Audit Committee
assists the Board of Directors by overseeing the accounting and financial
reporting processes of the Corporation and the audits of its financial
statements. The Audit Committee met three times during 2002.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee has reviewed the audited financial statements of the
Corporation for the year ended December 31, 2002, and has met with management
and KPMG LLP, the Corporation's independent auditors, to discuss the audited
financial statements.
5
The Audit Committee received from KPMG LLP written disclosures regarding
their independence and the letter required by Independence Standards Board
Standard No. 1, and has discussed with KPMG LLP their independence. In
connection with its review, the Audit Committee has also discussed with KPMG LLP
the matters required to be discussed by Statement of Auditing Standards No. 61.
Based on its review and discussions with management and KPMG LLP, the
Audit Committee recommended to the Board of Directors that the audited financial
statements be included in the Corporation's Annual Report to Stockholders for
the year ended December 31, 2002.
Members of the Audit Committee:
Donald G. Calder
Jay R. Inglis
Dudley D. Johnson
C. Carter Walker, Jr.
EXECUTIVE OFFICERS OF THE CORPORATION
The executive officers of the Corporation are Mr. Wilmot H. Kidd,
President, Mr. Charles N. Edgerton, Vice President and Treasurer, and Ms.
Marlene A. Krumholz, Secretary. Information concerning Mr. Kidd is given above
under "Election of Directors." Mr. Edgerton, 58, was elected Vice President in
1989 and has been Treasurer since 1985. Ms. Krumholz, 39, joined the Corporation
in November 2000 and was elected Secretary effective January 1, 2001. Ms.
Krumholz was Senior Manager, PricewaterhouseCoopers LLP (public accounting)
prior thereto. Executive officers serve as such until the election of their
successors.
COMPENSATION
The table below sets forth for all directors and for each of the three
highest-paid executive officers the aggregate compensation received from the
Corporation for 2002 for services in all capacities:
Pension or
Retirement
Benefits Accrued
Name of Person, Aggregate as Part of
Position Compensation Expenses(1)
--------------- ------------ ----------------
Donald G. Calder
Director .............................. $ 23,000
Jay R. Inglis
Director .............................. 25,000
Dudley D. Johnson
Director .............................. 25,000
C. Carter Walker, Jr.
Director .............................. 24,500
Wilmot H. Kidd
President and Director(2) ............. 700,000 $30,000
6
Pension or
Retirement
Benefits Accrued
Name of Person, Aggregate as Part of
Position Compensation Expenses(1)
--------------- ------------ ----------------
Charles N. Edgerton
Vice President and Treasurer .......... $240,000(3) $30,000
Marlene A. Krumholz
Secretary ............................. 159,000(3) 23,850
----------
(1)Represents contributions to the Corporation's Profit Sharing Plan.
(2)All remuneration received by Mr. Kidd was in his capacity as President
of the Corporation.
(3)Includes compensation of $25,000 and $24,000 accrued in 2002 for Mr.
Edgerton and Ms. Krumholz, respectively, deferred until January, 2003.
Each director who is not an officer is paid an annual retainer of $12,000,
a fee of $1,000 for each Board of Directors meeting attended in person, and $500
for participating in a Board of Directors meeting by telephone. Each member of
the Audit Committee is paid $1,000 for each Audit Committee meeting attended.
Directors are reimbursed for their out-of-pocket expenses incurred in attending
meetings.
Profit Sharing Plan
Generally, all salaried employees of the Corporation are eligible to
participate in the Profit Sharing Plan. The Plan provides for contributions by
the Corporation from its profits of up to 25% of an employee's compensation. The
vested contributions credited to an employee's account are payable at normal
(age 65), early, or disability retirement, death or other termination of
employment and may be paid in various forms, including a lump sum cash payment
or a monthly annuity. For the year ended 2002, the Corporation contributed 15%
of employee compensation to the Plan, subject to Internal Revenue Code
limitations. With the exception of Ms. Krumholz, the officers referred to above
are fully vested in all contributions to the Plan. Corporate contributions on
behalf of Ms. Krumholz vest on January 1, 2004.
Employees may withdraw the amounts of any voluntary contributions made
prior to 1991 and may, under certain conditions, withdraw or borrow against
vested Corporation contributions. Under the Plan, each employee is permitted to
invest the assets in his account in the capital stock of one or more regulated
investment companies from a selection provided from time to time by the Plan
Administrator. Such regulated investment companies include, among others, U.S.
Treasury funds; short-term, government and international bond funds; and general
and specialized stock funds.
AUDIT FEES
The aggregate fees billed to the Corporation by KPMG LLP for the
performance of the audit and the review of the Corporation's financial
statements during 2002 were $32,000.
ALL OTHER FEES
The aggregate fees billed to the Corporation by KPMG LLP for all non-audit
services, including fees for tax-related services, during 2002 were $13,000.
Such non-audit services did not include any financial information systems design
and implementation services. The Audit Committee considered whether the
7
provision of non-audit services by KPMG LLP is compatible with maintaining KPMG
LLP's independence with respect to the Corporation.
PROPOSAL 2. RATIFICATION OF INDEPENDENT AUDITORS
Stockholders are invited to ratify the selection of KPMG LLP as
independent auditors of the Corporation for the year 2003. KPMG LLP has no
direct or material indirect financial interest in the Corporation other than its
employment in such capacity.
At a meeting held January 29, 2003, a majority of the directors who were
not "interested persons" (as defined under the Investment Company Act of 1940)
selected KPMG LLP to act as auditors for the Corporation during 2003. A
representative of KPMG LLP is not expected to be present at the Meeting.
The Board of Directors recommends a vote FOR this selection.
OTHER MATTERS
The Board of Directors knows of no other matters which may properly be,
and are likely to be, brought before the Meeting. However, if any proper matters
are brought before the Meeting, the persons named in the enclosed form of proxy
will have discretionary authority to vote thereon according to their best
judgment.
2004 STOCKHOLDER PROPOSALS
Any stockholder proposals for inclusion in the Corporation's proxy
statement for the 2004 Annual Meeting of Stockholders pursuant to Rule 14a-8 of
the Securities and Exchange Act of 1934 ("14a-8 proposals") must be received by
the Corporation at its office at New York, New York prior to October 8, 2003.
Pursuant to Rule 14a-4 of the Securities and Exchange Act of 1934, the
Corporation has discretionary voting authority with respect to any non-Rule
14a-8 proposals for the 2004 Annual Meeting of Stockholders that are not
received by the Corporation prior to December 22, 2003.
MISCELLANEOUS
The Corporation will pay all costs of soliciting proxies in the
accompanying form. Solicitation will be made by mail, and officers and regular
employees of the Corporation may also solicit proxies by telephone or personal
interview. The Corporation will request brokers, banks and nominees who hold
stock in their names to furnish this proxy material to the beneficial owners
thereof and to solicit proxies from them, and will reimburse such brokers, banks
and nominees for their out-of-pocket and reasonable clerical expenses in
connection therewith.
A copy of the Annual Report including financial statements for the year
ended December 31, 2002 is enclosed.
Please date, sign and return the enclosed proxy at your earliest
convenience. No postage is required for mailing in the United States.
8
EXHIBIT A
CHARTER OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
OF CENTRAL SECURITIES CORPORATION
AUTHORITY AND PURPOSE
By resolution adopted December 17, 1973, the Board of Directors of Central
Securities Corporation (the "Corporation") created an Audit Committee of the
Board of Directors (the "Audit Committee"). The purpose of the Audit Committee
is to oversee the accounting and financial reporting processes of the
Corporation and the audits of its financial statements.
The Corporation's management is responsible for the preparation of the
Corporation's financial statements and for maintaining appropriate accounting
and financial reporting principles and policies as well as internal controls and
procedures designed to assure compliance with accounting standards and
applicable laws and regulations. The independent auditors are responsible for
auditing the Corporation's financial statements.
The Corporation's management and independent auditors have more time,
knowledge and detailed information on the Corporation than do the members of the
Audit Committee. Therefore, in carrying out its oversight responsibilities, the
Audit Committee is not providing any special assurance as to the Corporation's
financial statements nor any professional certification as to the independent
auditors' work. The members of the Audit Committee shall be entitled to rely
upon the integrity of the individuals and organizations within and outside the
Corporation from whom it receives information and the accuracy of the
information provided to them by such individuals or organizations absent actual
knowledge to the contrary. The Audit Committee shall have the authority to
engage independent counsel and other advisers, as it deems necessary or
appropriate. The Corporation shall provide appropriate funding, as determined by
the Audit Committee, for payment of compensation to any adviser employed by the
Audit Committee.
The following affirms and sets forth in detail the membership
requirements, structure and responsibilities of the Audit Committee.
MEMBERSHIP REQUIREMENTS
1. The Audit Committee shall be elected by the Board of Directors and shall
be comprised solely of independent directors, and each member of the Audit
Committee shall be free from any relationship that, in the opinion of the
Board of Directors, would interfere with the exercise of independent
judgment as an Audit Committee member.
2. The members of the Audit Committee shall meet the independence and
experience requirements of the exchange on which the Corporation's stock
is listed and rules and regulations of the Securities and Exchange
Commission ("SEC"), in each case as in effect. Members of the Audit
Committee may not, other than in their capacity as members of the Audit
Committee, the Board of Directors of the Corporation, or any other
committee of the Board of Directors, accept any consulting, advisory, or
other
A-1
compensatory fee from the Corporation or be an "interested person" of the
Corporation (as defined in Section 2(a)(19) of the Investment Company Act of
1940).
STRUCTURE
1. The number of directors comprising the Audit Committee shall be no fewer
than three, such number to be determined from time to time by the Board of
Directors.
2. Unless a Chair is elected by the full Board of Directors, the members of
the Audit Committee may designate a Chair by majority vote.
3. The Audit Committee shall meet formally at least four times each year or
more frequently as circumstances may dictate, and it shall meet privately
(without members of management present) with the independent auditors at
its discretion to discuss any matters that the Audit Committee or the
independent auditors believe should be discussed.
RESPONSIBILITIES
Independent Auditors
The Audit Committee shall recommend annually the independent auditors to
be selected by the Board of Directors subject to ratification by the vote of the
stockholders of the Corporation. The Audit Committee shall be directly
responsible for compensation and oversight of the work of the independent
auditors (including resolution of disagreements between management and the
independent auditors regarding financial reporting). The independent auditors
are ultimately accountable to the Audit Committee and the Board of Directors as
representatives of the stockholders of the Corporation.
In carrying out these responsibilities, the Audit Committee shall:
1. Pre-approve all audit and permitted non-audit services that the
independent auditors provide to the Corporation. This pre-approval
requirement may be waived with respect to the provision of non-audit
services in the limited circumstances defined in Section 10A(i)(1)(B) of
the Securities Exchange Act of 1934.
The Audit Committee may delegate to one or more designated members
of the Audit Committee the authority to grant the pre-approvals required
above. The decision of any member to whom authority is delegated under
this paragraph to pre-approve an activity shall be presented to the full
Audit Committee at its next scheduled meeting.
2. Receive annually from the independent auditors a formal written statement
delineating all relationships between the auditors and the Corporation in
accordance with Independence Standards Board Standard 1.
3. Actively engage in a dialogue with the independent auditors regarding any
disclosed relationship or services performed by the independent auditors
that might impact the objectivity and independence of the auditors and
take, or recommend that the full Board of Directors take, appropriate
action to oversee and satisfy itself annually of the independence of the
independent auditors.
4. Receive annually from the independent auditors an engagement letter and
review the fees and other compensation to be paid to the independent
auditors.
A-2
5. Review and discuss with the independent auditors the proposed scope,
staffing, reliance upon management and general audit approach of the
year-end audit.
6. Communicate to the independent auditors that they are ultimately
accountable to the Audit Committee and the Board of Directors as the
representatives of the stockholders of the Corporation.
Financial Reporting
It shall be the responsibility of the Audit Committee to assist the Board
of Directors by providing oversight on matters pertaining to the accounting,
financial reporting, internal control and audit activities of the Corporation.
In carrying out these responsibilities, the Audit Committee shall:
1. Review and discuss with management and the independent auditors, following
the conclusion of the year-end audit, the audited financial statements to
be included in the Corporation's annual report to stockholders under
Section 30(e) of the Investment Company Act of 1940 and Rule 30d-1
thereunder, including discussion of certain matters required to be
communicated to audit committees in accordance with AICPA Statement of
Auditing Standards No. 61 ("SAS 61").
2. Review and discuss reports from the independent auditor regarding (i) all
critical accounting policies and practices used; (ii) all alternative
treatments of financial information within generally accepted accounting
principles that have been discussed with management of the Corporation,
ramifications of the use of such alternative disclosures and treatments,
and the treatment preferred by the independent auditors; and (iii) other
material written communications between the independent auditors and
management of the Corporation.
3. Discuss and consider the independent auditors' judgments about the quality
and appropriateness of the Corporation's accounting principles as applied
in its financial reporting in accordance with SAS 61.
4. Discuss with management and the independent auditors significant issues
regarding the Corporation's internal controls, including any significant
findings prepared by the independent auditors with respect thereto.
5. Inquire into any changes in the Corporation's accounting principles and
practices and the effect of any changes in accounting standards that may
materially affect the Corporation's financial reporting practices.
6. Advise the Board of Directors whether, based on these reviews and
discussions and its assessment of the independent auditors' independence,
the Audit Committee recommends that the audited financial statements be
included in the Corporation's annual report to stockholders under Section
30(e) of the Investment Company Act of 1940 and Rule 30d-1 thereunder.
Other Duties
In addition to the foregoing responsibilities, the Audit Committee shall:
1. Prepare annually a report to stockholders to be included in the
Corporation's proxy statement as required by the SEC.
A-3
2. Review and reassess the adequacy of this Charter at least annually, make
recommendations to the Board of Directors, as conditions dictate, to
update this Charter, and direct that this Charter be included as an
exhibit to the Corporation's proxy statement at least every three years in
accordance with SEC regulations.
3. Perform any other activities consistent with this Charter, the
Corporation's by-laws, and governing law as the Audit Committee or the
Board of Directors deems necessary or appropriate, including causing an
investigation to be made into any matter brought to the attention of the
Audit Committee within the scope of its duties.
--------------------------------------------------------------------------------
CENTRAL SECURITIES CORPORATION
Proxy Solicited on Behalf of the Board of Directors of
the Company for Annual Meeting March 12, 2003
P The undersigned hereby appoints WILMOT H. KIDD and MARLENE A. KRUMHOLZ,
R and each of them, as attorneys with power of substitution, to represent
O the undersigned at the annual meeting of stockholders of Central
X Securities Corporation to be held at The University Club, One West 54th
Y Street, 9th Floor, New York, New York on March 12, 2003, at 11:00 o'clock
A.M., and at any adjournment thereof, on all matters which may properly
come before the meeting.
Election of Directors:
Nominees to be elected by Common Stock:
Donald G. Calder, Jay R. Inglis,
Dudley D. Johnson, Wilmot H. Kidd
and C. Carter Walker, Jr.
-------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
-------------------------------------------------
(Continued on reverse side)
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|
[X] Please mark your | 1224
votes as in this ----
example.
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. If no direction is made, this proxy will be voted
FOR election of directors and FOR Proposal 2.
1. Election of FOR WITHHELD
Directors. (see [ ] [ ]
reverse)
For, except vote withheld from the following nominee(s):
________________________________________________________
2. APPROVAL OF KPMG LLP FOR AGAINST ABSTAIN
as independent [ ] [ ] [ ]
auditors for 2003.
3. In their discretion, upon such other matters as may properly come before
the meeting or any adjournments thereof.
This Proxy Must Be Signed
Exactly as Name Appears Hereon
Joint owners should each sign. Executors,
administrators, trustees, etc., should give
full title as such. If the signer is a
corporation, please sign full corporate
name by duly authorized officer.
________________________________________
2003
________________________________________
SIGNATURE(S) DATE