<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Triumph Group Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
TRIUMPH GROUP, INC.
FOUR GLENHARDIE CORPORATE CENTER
1255 DRUMMERS LANE - SUITE 200
WAYNE, PENNSYLVANIA 19087
(610) 975-0420
--------------------
Notice of Annual Meeting of Stockholders
To Be Held on July 28, 1999
To holders of shares of Common Stock and Class D Common Stock:
You are invited to be present either in person or by proxy at the
annual meeting of stockholders of Triumph Group, Inc. to be held at Triumph's
principal executive offices at Four Glenhardie Corporate Center, 1255 Drummers
Lane - Suite 200, Wayne, Pennsylvania 19087, on Wednesday, July 28, 1999,
beginning at 1:00 p.m., local time, for the following purposes:
1. To elect seven (7) directors for the coming year;
2. To approve an amendment to the Triumph Group, Inc. 1996 Stock Option
Plan to increase to 1,268,750 the number of shares issuable upon
exercise of options granted under the plan, an increase of 750,000
shares;
3. To ratify the selection of Ernst & Young LLP as Triumph's independent
auditors for the fiscal year ending March 31, 2000; and
4. To transact any other business as may properly come before the meeting
or any postponements or adjournments.
Management presently knows of no other business to be presented at the
meeting. If any other matters come before the meeting, the persons named in the
enclosed proxy will vote with their judgment on those matters.
The board of directors has fixed the close of business on May 28, 1999
as the record date for determining stockholders entitled to notice of and to
vote at the meeting and any adjournments. To make sure that your vote is
counted, please complete, date and sign the enclosed proxy and return it
promptly in the enclosed envelope, whether or not you plan to attend the meeting
in person. A self-addressed, postage paid envelope is enclosed for your
convenience. If you do attend the meeting, you may then withdraw your proxy and
vote your shares in person. In any event, you may revoke your proxy prior to its
exercise. Shares represented by proxies which are returned properly signed but
unmarked will be voted in favor of proposals made by Triumph.
By order of the board of directors,
/s/ Richard M. Eisenstaedt
------------------------------------
Richard M. Eisenstaedt
June 30, 1999 Secretary
Wayne, Pennsylvania
Your vote is important
PLEASE FILL IN, DATE AND SIGN THE ACCOMPANYING PROXY AND RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE, WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING. NO POSTAGE IS NECESSARY IF THE ENVELOPE IS MAILED IN THE UNITED STATES.
<PAGE>
Triumph Group, Inc.
Four Glenhardie Corporate Center
1255 Drummers Lane - Suite 200
Wayne, Pennsylvania 19087
(610) 975-0420
--------------------
Proxy Statement
for 1999 Annual Meeting of Stockholders
To be held on July 28, 1999
GENERAL INFORMATION
This proxy statement is furnished in connection with the solicitation
by the board of directors of Triumph Group, Inc. of proxies to be voted at its
annual meeting of stockholders on Wednesday, July 28, 1999, to be held at 1:00
p.m., local time, at Triumph's offices at Four Glenhardie Corporate Center, 1255
Drummers Lane - Suite 200, Wayne, Pennsylvania and at any adjournments, for the
purposes set forth in the accompanying notice of the meeting. This proxy
statement, the foregoing notice and the enclosed proxy card will first be mailed
to stockholders entitled to vote on or about June 30, 1999.
Sending a signed proxy will not affect a stockholder's right to attend
the meeting and vote in person because the proxy is revocable. Any stockholder
giving a proxy has the power to revoke it by, among other methods, giving
written notice to the Secretary of Triumph at any time before the proxy is
exercised or by attending the meeting and voting in person.
When your proxy card is returned properly signed, those shares will be
voted in accordance with your instructions. The board knows of no matters that
are likely to be brought before the meeting, other than the matters specifically
referred to in the notice of the meeting. If any other matters properly come
before the meeting, the persons named in the enclosed proxy, or their duly
appointed substitutes acting at the meeting, will be authorized to vote or
otherwise act with their judgment in those matters. In the absence of
instructions, the shares represented at the meeting by the enclosed proxy will
be voted "FOR" the nominees for director, "FOR" the increase in the number of
shares issuable under the Triumph Group, Inc. 1996 Stock Option Plan and "FOR"
the ratification of the selection of Ernst & Young LLP as Triumph's independent
auditors for the fiscal year ending March 31, 2000.
SOLICITATION OF PROXIES
The expense of this proxy solicitation will be borne by Triumph. In
addition to solicitation by mail, proxies may be solicited in person or by
telephone or telecopy by officers or other regular employees of Triumph, without
additional compensation to those officers and other employees. Triumph is
required to pay, upon request, the reasonable expenses incurred by record
holders of Common Stock, who are brokers, dealers, banks, voting trustees or
other nominees for mailing proxy material and annual stockholder reports to any
beneficial owners of Common Stock they hold of record.
<PAGE>
QUORUM AND VOTING RIGHTS
Holders of record of Triumph's Common Stock and Class D Common Stock,
as of the close of business on May 28, 1999, the record date, will be entitled
to notice and to vote at the meeting and at any adjournments. Holders of shares
of Common Stock are entitled to vote on all matters brought before the meeting.
Holders of Class D Common Stock are not entitled to vote in the election of
directors, but are entitled to vote on all other matters brought before the
meeting. Each share of Class D Common Stock may be converted into one share of
Common Stock, at any time, at the option of the holder.
As of the record date, there were 8,382,836 shares of Common Stock
outstanding and entitled to vote on the election of directors. As of the record
date, there were 8,382,836 shares of Common Stock and 3,348,535 shares of Class
D Common Stock for a total of 11,731,371 shares outstanding and entitled to vote
on all other matters. Holders of Common Stock will vote on the election of
directors as a class and the holders of Common Stock and Class D Common Stock
will vote on all other matters together as a class. Each outstanding share of
Common Stock and Class D Common Stock entitles the holder to one vote.
The presence in person or by proxy of the holders of a majority of the
outstanding Common Stock and Class D Common Stock is necessary to constitute a
quorum at the meeting.
Directors will be elected by a plurality of the votes cast by holders
of Common Stock, voting together as a class, represented in person or by proxy
at the meeting. Abstentions in the election of directors will be counted for the
purpose of determining whether a quorum is present at the meeting but will not
be considered as votes cast. Because directors are elected by a plurality of
votes, abstentions will not have an impact on their election.
The holders of Common Stock are entitled to cumulate their votes in the
election of directors, which gives a holder of Common Stock the right to cast as
many votes in the aggregate as he or she is entitled to vote multiplied by the
number of directors to be elected and to cast all votes for one director nominee
or distribute these votes among two or more director nominees, as this holder
sees fit. Each holder of Common Stock may indicate his or her preference on the
enclosed proxy. If no preference is indicated, all votes to which this holder is
entitled will be voted pro rata in favor of all nominees indicated.
Approval of the amendment to the 1996 stock option plan and
ratification of the board's selection of Triumph's auditors and any other
matters brought before the meeting, other than the election of directors, will
require the favorable vote of a majority of the outstanding shares of Common
Stock and Class D Common Stock, voting together as a class, represented in
person or by proxy at the meeting. Triumph is not aware of any matter, other
than as referred to in this proxy statement, to be presented at the meeting.
Abstentions in ratification of the selection of Triumph's auditors and of any
other proposals will be counted for the purpose of determining whether a quorum
is present at the meeting and as votes cast and will have the effect of a
negative vote.
Broker non-votes for all proposals will not be counted in determining
the presence of a quorum and will not be considered as votes cast, and will have
no effect on the results of the votes.
2
<PAGE>
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
The board currently consists of seven directors. One director, Mr.
Albertini was appointed by the board on May 10, 1999 to fill an existing
vacancy. At the meeting, the stockholders will elect all seven directors for a
term ending at the next annual meeting of stockholders and until that director's
successor is duly elected and qualified.
The table below sets forth the name of each person nominated by the
board to serve as a director for the coming year. All of the nominees are
currently directors of Triumph for terms expiring at the meeting. Each nominee
has consented to be named as a nominee and, to the present knowledge of Triumph,
is willing to serve as a director, if elected. Should any of the nominees not
remain a nominee at the end of the meeting (a situation which is not
anticipated), solicited proxies will be voted in favor of those who remain as
nominees and may be voted for substitute nominees. Unless contrary instructions
are given on the proxy, the shares represented by a properly executed proxy will
be voted pro rata "FOR" the election of Richard C. Ill, John R. Bartholdson,
Richard C. Gozon, Claude F. Kronk, Joseph M. Silvestri, Michael A. Delaney and
William O. Albertini.
<TABLE>
<CAPTION>
Nominees Age Year First Elected a Director
- -------- --- -----------------------------
<S> <C> <C>
Richard C. Ill 56 1993
John R. Bartholdson 54 1993
Richard C. Gozon 60 1993
Claude F. Kronk 67 1993
Joseph M. Silvestri 37 1994
Michael A. Delaney 45 1995
William O. Albertini 55 1999
</TABLE>
The principal occupations and qualifications of each nominee for
director are as follows:
Richard C. Ill has been President and Chief Executive Officer and a
director of Triumph since 1993. Mr. Ill joined Alco Standard Corporation in 1968
(now IKON Office Solutions, Inc.), and became Group Vice President of
Metalsource, a steel distribution business, in 1973. In 1975, Mr. Ill became
President of Triumph Industries and, in 1983, became President of Metalsource.
In 1988, Mr. Ill became President of Alco Diversified Services, a division of
Alco Standard. He was named a Vice President of Alco Standard in 1989. Mr. Ill
is a member of the advisory board of Outward Bound, USA and the board of
directors, chairman's council and policy and planning committees of Interstate
Steel Supply.
John R. Bartholdson has been Senior Vice President, Chief Financial
Officer and Treasurer and a director of Triumph since 1993. Mr. Bartholdson
joined Alco Diversified Services in the fall of 1992. Prior to joining Alco
Diversified Services, Mr. Bartholdson was employed for 14 years by Lukens, Inc.,
a manufacturer of specialty steel products, the last five years in the position
of Senior Vice President and Chief Financial Officer. Mr. Bartholdson serves on
the board of directors and is a member of the compensation committee of PBHG
Funds, Inc.
Richard C. Gozon has been a director of Triumph since 1993. Mr. Gozon
has been Executive Vice President of Weyerhaeuser Company since 1994. From 1988
to 1993, Mr. Gozon served as President and
3
<PAGE>
Chief Operating Officer and a director of Alco Standard. Mr. Gozon serves on the
board of directors of U.G.I. Corporation and AmeriSource Health Corporation.
Claude F. Kronk has been a director of Triumph since 1993. Mr. Kronk
retired on January 1, 1998 from his position as Vice Chairman and Chief
Executive Officer of J&L Specialty Steel, Inc., a position which he held in
excess of five years. Mr. Kronk serves on the board of directors of Cold Metal
Products, Co. and Bangor Hydro-Electric Co.
Joseph M. Silvestri has been a director of Triumph since 1994. Mr.
Silvestri has been employed by Citicorp Venture Capital, Ltd. since 1990 and has
been a Vice President since 1995. Mr. Silvestri serves on the board of directors
of Glenoit Mills, Euramax International, Inc., GNI Group, Inc. and ISG
Resources.
Michael A. Delaney has been a director of Triumph since 1995. Mr.
Delaney has been a Managing Director of CVC since 1989. From 1986 through 1989,
Mr. Delaney was Vice President of Citicorp Mergers and Acquisitions. Mr. Delaney
serves on the board of directors of AmeriSource, Clark Material Handling
Company, Delco Remy International, Enterprise Media Ltd., FabriSteel, Inc., GVC
Holdings, International Knife and Saw, Inc., JAC Holdings, MSX International,
Palomar Technologies Holdings, Southern Coil Processing, Allied Digital
Technologies Corporation, Great Lakes Dredge & Dock Company and Trianon
Industries.
William O. Albertini has been a director of Triumph since May 1999 when
he was appointed by the remaining members of the board to fill an existing
vacancy. Mr. Albertini was Executive Vice President and Chief Financial Officer
of Bell Atlantic Corp. from 1991 through 1997. In 1997, Mr. Albertini became
Executive Vice President and Chief Financial Officer of Bell Atlantic Global
Wireless and remained in that position until his retirement on May 1, 1999. Mr.
Albertini serves on the board of directors of American Water Works and Blackrock
Funds.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" EACH OF THE NOMINEES
PRESENTED. THE SEVEN NOMINEES RECEIVING THE HIGHEST NUMBER OF AFFIRMATIVE VOTES
OF THE SHARES OF COMMON STOCK PRESENT OR REPRESENTED AND ENTITLED TO VOTE AT THE
MEETING WILL BE ELECTED AS DIRECTORS.
MEETINGS AND COMMITTEES OF THE BOARD
The board held five meetings during Triumph's fiscal year ended March
31, 1999 and also acted by unanimous consents in writing. The standing
committees of the board are the audit committee and the compensation committee.
Triumph does not have an executive committee or a nominating committee. The
audit committee, consisting of Messrs. Gozon, Kronk and Delaney, met two times
during the last fiscal year. Mr. Delaney resigned from the audit committee in
May 1999, and the audit committee currently consists of Messrs. Gozon, Kronk and
Albertini. The audit committee communicates and receives information directly
from Triumph's independent auditors. The compensation committee, consisting of
Messrs. Gozon, Kronk and Silvestri, met three times during the last fiscal year.
The compensation committee periodically reviews and evaluates the compensation
of Triumph's officers, administers Triumph's 1996 Stock Option Plan and
establishes guidelines for compensation of other personnel. The board does not
have a nominating committee.
4
<PAGE>
COMPENSATION OF DIRECTORS
Directors who are also employees of Triumph or CVC do not receive
additional compensation for serving as directors. Each director who is not an
employee of Triumph or CVC receives an annual fee of $15,000 and a fee of $1,000
for attendance at each board meeting and $500 for each committee meeting (unless
held on the same day as a board meeting). Each director who is not an employee
of Triumph is entitled to receive options to purchase shares of Common Stock
under Triumph's Directors' Stock Option Plan. Any options granted under the
Directors' Plan are in addition to other compensation to those directors. All
directors are reimbursed for out-of-pocket expenses incurred in attending
meetings of the board or its committees.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid to the President
and Chief Executive Officer and to each of the four most highly compensated
executive officers of Triumph and its subsidiaries, other than the President and
Chief Executive Officer, for the fiscal years ended March 31, 1999, 1998 and
1997.
"Bonus" consists of cash bonuses earned in the fiscal year identified,
of which only a portion was paid in that year to Messrs. Ill and Bartholdson.
"Other Annual Compensation" reflects amounts contributed by Triumph to
its 401(k) Plan for the benefit of the named employee.
"All Other Compensation" consists of group term life insurance
premiums.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation
-------------------------------------------------
Other Annual All Other
Name and Position Year Salary Bonus Compensation Compensation
- ----------------- ---- ------ ----- ------------ ------------
<S> <C> <C> <C> <C> <C>
Richard C. Ill 1999 $345,000 $379,500 $5,225 $8,550
President and Chief Executive 1998 315,000 346,500 4,929 5,472
Officer 1997 291,200 291,200 3,951 5,472
John R. Bartholdson 1999 $290,000 $290,000 $5,129 $4,320
Senior Vice President, Chief 1998 267,000 267,000 4,848 4,320
Financial Officer and Treasurer 1997 249,600 249,600 4,024 4,320
Richard M. Eisenstaedt 1999 $175,500 $115,000 $4,950 $2,592
Vice President, General 1998 164,000 114,800 4,725 2,592
Counsel and Secretary 1997(1) 68,792 60,000 0 1,080
Paul T. Stimmler 1999 $110,000 $55,000 $3,300 $4,950
Vice President and 1998 106,500 53,000 3,196 4,950
Assistant Secretary 1997 103,500 50,000 2,674 4,950
Kevin E. Kindig 1999 $100,000 $55,000 $3,000 $714
Vice President and 1998 85,000 42,500 2,550 714
Controller 1997 78,500 39,250 2,028 462
</TABLE>
- --------------------
(1) Mr. Eisenstaedt began employment with Triumph in October 1996.
6
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth, for each of the executive officers
named above, certain information concerning options granted under the 1996 stock
option plan during the fiscal year ended March 31, 1999.
The options vest in four equal installments on each of the first,
second, third and fourth anniversaries of April 19, 1998.
The exercise price for each option is equal to the fair market value of
the Common Stock on the date of grant.
Potential realizable value is based on the assumed annual growth rates
listed, compounded annually for the ten-year option term. The dollar amounts set
forth under this heading are the results of calculations required by the SEC and
are not intended to forecast possible future appreciation, if any, of the value
of the Common Stock.
<TABLE>
<CAPTION>
Individual Grants
-------------------------------------------------------------- Potential Realizable Value
Number of % of Total At Assumed Annual Rates
Securities Options of Stock Appreciation for
Underlying Granted to Exercise or Option Term
Options Employees in Base Price Expiration ---------------------------
Name Granted (#) Fiscal Year ($/SH) Date 5% 10%
---- ----------- ----------- ------ ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
Richard C. Ill 18,000 9.88 43.125 4/19/08 488,180 1,237,143
John R. Bartholdson 18,000 9.88 43.125 4/19/08 488,180 1,237,143
Richard M. Eisenstaedt 5,000 2.74 43.125 4/19/08 135,605 343,651
Paul T. Stimmler 2,000 1.10 43.125 4/19/08 54,242 137,460
Kevin E. Kindig 2,000 1.10 43.125 4/19/08 54,242 137,460
</TABLE>
7
<PAGE>
FISCAL YEAR END OPTION VALUES
The following table sets forth, for each of the named executive
officers, information about the value of unexercised options at March 31, 1999.
The fair market value of "in-the-money" options was calculated on the
basis of the difference between the exercise price of the options held and the
closing price per share for Common Stock on the NYSE of $23.50 on March 31,
1999, multiplied by the number of options held.
<TABLE>
<CAPTION>
Number of Securities Value of
Underlying Unexercised Unexercised In-
Options at Fiscal the-Money Options at
Shares Year End (#) Fiscal Year End ($)(1)
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized($) Unexercisable Unexercisable
- ---- ------------ ----------- ---------------------- ----------------------
<S> <C> <C> <C> <C>
Richard C. Ill 0 0 17,500/35,500 $78,750/78,750
John R. Bartholdson 0 0 17,500/35,500 78,750/78,750
Richard M. Eisenstaedt 0 0 5,000/10,000 22,500/22,500
Paul T. Stimmler 0 0 5,000/7,000 22,500/22,500
Kevin E. Kindig 0 0 5,000/7,000 22,500/22,500
</TABLE>
- --------------------
EMPLOYMENT AGREEMENTS
Triumph entered into employment agreements with Richard C. Ill and John
R. Bartholdson, effective October 1, 1996, pursuant to which Messrs. Ill and
Bartholdson serve as President and Chief Executive Officer and as Senior Vice
President and Chief Financial Officer, respectively, of Triumph through
September 30, 1999, unless earlier terminated by the board or, in certain
circumstances following a change of control transaction, by the executive. These
agreements provide for an annual salary to Mr. Ill of not less than $291,200 and
to Mr. Bartholdson of not less than $249,600, plus incentive compensation as
determined by the board or the compensation committee, by authority delegated by
the board, and comparable benefits and perquisites given to other members of
senior management. Messrs. Ill and Bartholdson are entitled to severance and
other payments following the earlier termination of employment by Triumph or
upon termination by the executive following a change in control of Triumph. The
executive may terminate his employment following a change of control
transaction, if as a result of this change in control, the executive is required
to accept a material reduction in his duties and responsibilities or a
geographical relocation or the successor company fails to assume the executive's
employment agreement. In the event of any early termination (other than for
"cause," death or disability), Messrs. Ill and Bartholdson are entitled to
receive a severance payment from Triumph equal to 24 months salary. Messrs. Ill
and Bartholdson are required to devote substantially all of their time and
effort during normal business hours (reasonable sick leave and vacations
excepted) to the business and affairs of Triumph.
8
<PAGE>
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
OVERALL POLICY
Triumph's executive compensation program is designed to be closely
linked to corporate performance and results. To this end, Triumph has developed
an overall compensation plan to provide its executive officers with the
opportunity to earn cash compensation plus the opportunity to accumulate
stock-based wealth commensurate with the long-term growth and value created for
Triumph's stockholders. Triumph's compensation strategy is to place the major
portion of total compensation at risk in the form of annual incentives and
long-term, stock-based compensation programs. The overall objectives of this
strategy are to attract and retain the best and most experienced executive
talent, to motivate these executives to achieve the goals inherent in Triumph's
business strategy, to link executive and stockholder interests through
equity-based plans and finally to provide a compensation package that recognizes
individual contributions as well as overall business results.
The compensation committee has received a comprehensive report from an
independent compensation consultant which evaluated Triumph's compensation
program against industry and peer group norms. Triumph seeks to offer base
salaries for Triumph's executive officers at levels that are competitive with
its industry group, that is, companies of similar size in the aviation and
general manufacturing industries. In addition, Triumph provides significant
incentive opportunities for its executive officers. Triumph's target for total
cash compensation opportunities (salary plus bonus) is between the median and
the 75th percentile for its industry group, with significant variability based
on company-wide, business unit and individual performance. Triumph's annual
incentive plan for executive officers is tied to business plans using a
performance matrix based on consolidated return on operating assets,
consolidated operating income and earnings per share. For the two most highly
compensated executive officers, Triumph's target for annual incentive awards is
55% and 50%, respectively, and their maximum annual incentive awards are 110%
and 100%, respectively. Triumph's other executive officers have annual incentive
award opportunities which are determined by the executive officer's job function
and level within Triumph. The actual award is established by the President and
Chief Executive Officer of Triumph based on the performance of Triumph and the
individual, subject to the review and approval of the compensation committee.
Awards above 50% of salary must be deferred and executive officers may elect two
year deferrals or career deferrals. All deferrals are subject to the accrual of
interest to be paid by Triumph to the executive officer. Stock options are
awarded to executive officers and other management employees to align the
interest of Triumph's management with those of its stockholders.
The compensation committee determines the compensation of Richard C.
Ill, the President and Chief Executive Officer of Triumph, and of John R.
Bartholdson, the Senior Vice President, Chief Financial Officer and Treasurer of
Triumph. In addition, the board reviews the compensation proposed to be awarded
by Messrs. Ill and Bartholdson to Triumph's other four executive officers
including Craig N. Kitchen who joined Triumph in March 1999 as the Vice
President - Marketing and Sales, and the presidents of each of Triumph's
operating divisions and subsidiaries.
As discussed above, the key elements of Triumph's executive
compensation consist of base salary, annual bonus and options granted under
Triumph's option plans. The compensation committee's policies for each of these
elements, including the basis for the compensation awarded to Mr. Ill, Triumph's
President and Chief Executive Officer, are discussed below. In addition, while
the elements of compensation described
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<PAGE>
below are considered separately, the compensation committee takes into account
the full compensation package afforded by Triumph to the individual, including
matching under its 401(k) plan, insurance and other benefits, as well as the
programs described below.
BASE SALARIES
Base salaries for executive officers are initially determined by
evaluating the responsibilities of the position held and the experience of the
individual, and by reference to the competitive marketplace for executive
talent, including a comparison to base salaries for comparable positions at
other companies in Triumph's industry group. Annual salary adjustments are
determined by evaluating the performance of Triumph and of each executive
officer, and also take into account new responsibilities.
For the base salary granted to Mr. Ill for the fiscal year ended March
31, 1999, the compensation committee took into account a comparison of base
salaries of chief executive officers of Triumph's industry group, Triumph's
success in meeting its financial objectives in this fiscal year, the performance
of the Common Stock and the assessment by the compensation committee of Mr.
Ill's individual performance. The compensation committee also took into account
the longevity of Mr. Ill's service to Triumph and its belief that Mr. Ill is an
excellent representative of Triumph to the public by virtue of his stature in
the community and the industry. Mr. Ill was granted a base salary of $345,000
for the fiscal year ended March 31, 1999, as permitted by his employment
agreement with Triumph, an increase of 9.52% from his $315,000 base salary for
the fiscal year ended March 31, 1998.
ANNUAL BONUS
Triumph's executive officers are eligible for an annual cash bonus. The
corporate performance measure for bonus payments is tied to business plans based
on levels of consolidated return on operating assets, consolidated operating
income and earnings per share. If a minimum level of consolidated return on
operating assets and consolidated operating income is not met, no bonuses will
be paid. Individual non-financial performance measures are considered and, where
appropriate, unit performance measures, in determining bonus.
Triumph exceeded its maximum levels of consolidated cash return on
operating assets, consolidated operating income and earnings per share goals for
the fiscal year ended March 31, 1999. Based on these results, Mr. Ill was
awarded a bonus of $379,500, which represents an increase of 9.52% from the
bonus paid for the fiscal year ended March 31, 1998. This increase is due to
Triumph's continued record earnings, Triumph's strong revenue growth in the
fiscal year and Mr. Ill's leadership in identifying and executing several key
acquisitions to position Triumph for long range profitable growth. $189,750 of
Mr. Ill's bonus for the fiscal year ended March 31, 1999 has been deferred.
STOCK OPTIONS
Under the 1996 stock option plan, stock options may be granted to
Triumph's executive officers as well as its other employees. The compensation
committee sets guidelines for the size of stock option awards based on similar
factors, including competitive compensation data, as are used to determine base
salaries and annual bonus. In the event of poor corporate performance, the
compensation committee may elect not to award options.
10
<PAGE>
Stock options are designed to align the interests of executives with
those of the stockholders. Stock options are granted with an exercise price
equal to the market price of the Common Stock on the date of grant, vest over
four years and may be exercised for up to ten years from the date of grant. This
approach is designed to incentivize the creation of stockholder value over the
long term because the full benefit of the compensation package cannot be
realized unless stock price appreciation occurs over a number of years.
Forty-five thousand options to purchase shares of Common Stock were
granted to executive officers of Triumph during the fiscal year ended March 31,
1999. The compensation committee believes that significant equity interests in
Triumph held by Triumph's management align the interests of stockholders and
management.
CONCLUSION
Through the programs described above, a significant portion of
Triumph's executive compensation is linked directly to individual and corporate
performance and stock price performance relative to that of the overall market
as well as the industry index. The compensation committee intends to continue
the policy of linking executive compensation to corporate performance and
returns to stockholders, recognizing that the ups and downs of the business
cycle from time to time may result in an imbalance for a particular period.
Compensation Committee
Richard C. Gozon
Claude F. Kronk
Joseph M. Silvestri
This report of the compensation committee shall not be deemed
incorporated by reference by any general statement incorporating by reference
this proxy statement into any filing under the Securities Act or under the
Exchange Act except to the extent that Triumph specifically incorporates this
information by reference, and shall not otherwise be deemed filed under the
Securities Act and the Exchange Act and shall not be deemed soliciting material.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The compensation committee of the board is composed of Richard C.
Gozon, Claude F. Kronk and Joseph M. Silvestri. None of the members of the
compensation committee were employees of Triumph during the fiscal year ended
March 31, 1999.
11
<PAGE>
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
MANAGEMENT
As of May 28, 1999, the following nominees for director, the following
executive officers, all directors and executive officers as a group, and the
following 5% beneficial owner, were known to Triumph to be beneficial owners (as
defined in regulations issued by the SEC) of the outstanding Common Stock and
Class D Common Stock shown below.
A person is deemed to be the beneficial owner of securities that can be
acquired by that person within 60 days from the date of this proxy statement
upon the exercise of options and warrants. Each beneficial owner's percentage
ownership is determined by assuming that options and warrants that are held by
that person (but not those held by any other person) and that are exercisable
within 60 days from the date of this proxy statement have been exercised.
Unless otherwise noted, Triumph believes that all persons named in the
table have sole voting and investment power with respect to all shares of Common
Stock and Class D Common Stock beneficially owned by them.
The percent of total shares outstanding is based upon outstanding
shares of Common Stock and Class D Common Stock.
<TABLE>
<CAPTION>
Shares Beneficially Owned
-----------------------------------------------------------
Percent of
Total Shares
Name Number Outstanding
- ---- ------ ------------
<S> <C> <C>
Richard C. Ill.............................. 292,193(1) 2.49%
John R. Bartholdson ........................ 273,726(2)(3) 2.33%
Richard M. Eisenstaedt ..................... 7,250(4) *
Paul T. Stimmler ........................... 54,050(5)(6)(7) *
Kevin E. Kindig ............................ 36,253(8)(9) *
Richard C. Gozon ........................... 71,429(10) *
Claude F. Kronk ............................ 77,803(11) *
Joseph M. Silvestri ........................ 24,158(12) *
Michael A. Delaney ......................... 21,256(13) *
William O. Albertini........................ 2,000
Citicorp Venture Capital, Ltd............... 5,298,535(14) 42.79%
399 Park Avenue
New York, NY 10043
All executive officers and
directors as a group
(10 persons) ............................... 860,818 7.30%
</TABLE>
- -----------------
* Less than one percent.
12
<PAGE>
(1) Mr. Ill currently holds stock options to purchase 22,000 shares of
Common Stock, which options may be exercised in the next 60 days.
(2) Mr. Bartholdson currently holds stock options to purchase 22,000 shares
of Common Stock, which options may be exercised in the next 60 days.
(3) Mr. Bartholdson disclaims beneficial ownership of 3,900 shares of
Common Stock beneficially owned by his daughters.
(4) Mr. Eisenstaedt currently holds stock options to purchase 6,250 shares
of Common Stock, which options may be exercised in the next 60 days.
(5) Mr. Stimmler currently holds stock options to purchase 5,500 shares of
Common Stock, which options may be exercised in the next 60 days.
(6) Mr Stimmler disclaims beneficial ownership of 22,200 shares of Common
Stock held by his wife.
(7) Mr. Stimmler disclaims beneficial ownership of 1,350 shares held by his
daughter.
(8) Mr. Kindig currently holds stock options to purchase 5,000 shares of
Common Stock, which options may be exercised in the next 60 days.
(9) Mr. Kindig disclaims beneficial ownership of 200 shares of Common Stock
beneficially owned by his children.
(10) Mr. Gozon currently holds stock options to purchase 334 shares of
Common Stock, which options may be exercised in the next 60 days.
(11) Mr. Kronk currently holds stock options to purchase 334 shares of
Common Stock, which options may be exercised in the next 60 days.
(12) Mr. Silvestri currently holds stock options to purchase 334 shares of
Common Stock, which options may be exercised in the next 60 days.
(13) Mr. Delaney currently holds stock options to purchase 334 shares of
Common Stock, which options may be exercised in the next 60 days.
(14) Includes 1,300,000 shares of Common Stock and 3,348,535 shares of Class
D Common Stock, which Class D Common Stock cannot be voted in the
election of directors. Includes also 650,000 shares of Common Stock
which may be acquired upon exercise by World Equity Partners, L.P., an
affiliate of CVC, of an outstanding warrant held by World Equity
Partners.
PRINCIPAL STOCKHOLDERS
As of May 28, 1999, the following person was known to Triumph to be a
"beneficial owner" (as defined in regulations issued by the SEC) of more than
five percent of the outstanding Common Stock and Class D Common Stock.
The information in this table was furnished by CVC in reports to
Triumph and by filings with the SEC.
CVC has voting and investment power for all shares listed, except
650,000 shares of Common Stock which may be acquired upon exercise by World
Equity Partners, an affiliate of CVC, of its warrant.
<TABLE>
<CAPTION>
Name and Address Amount and Nature of Percent
Title of Class of Beneficial Owner Beneficial Ownership of Class
- -------------- ------------------- -------------------- --------
<S> <C> <C> <C>
Common Stock Citicorp Venture Capital, Ltd. 5,298,535(1) 41.79%
and Class D 399 Park Avenue
Common Stock New York, NY 10043
</TABLE>
- -----------
(1) Includes 1,300,000 shares of Common Stock and 3,348,535 shares of Class
D Common Stock, which Class D Common Stock cannot be voted in the
election of directors.
13
<PAGE>
PERFORMANCE GRAPH
The following graph compares the percentage change in cumulative total
stockholder return on the Common Stock, on a quarterly basis, from October 24,
1996 to the present with the cumulative total return over the same period of (i)
Standard & Poor's 500 Stock Index, (ii) the Aerospace/Defense Industry Index
published by Standard & Poor's and (iii) the Russell 2000 index.
Beginning with the Proxy Statement for the 2000 Annual Meeting of
Stockholders, Triumph will be replacing Standard & Poor's 500 Stock Index with
the Russell 2000 Index in the following comparison graph. The Russell 2000 Index
measures the performance of the 2,000 smallest companies within the 3,000
largest United States companies based on total market capitalization. Management
has determined that Triumph more closely identifies with investors of these
smaller capitalization stocks, and therefore, the Russell 2000 Index will
provide a more accurate comparison with Triumph's cumulative total stockholder
return. Triumph has not paid cash dividends on its Common Stock. HISTORIC STOCK
PRICE IS NOT INDICATIVE OF FUTURE STOCK PRICE PERFORMANCE.
<TABLE>
CUMULATIVE TOTAL RETURNS
-----------------------------------------
10/25/96 3/97 3/98 3/99
<S> <C> <C> <C> <C>
TRIUMPH GROUP, INC. 100 116 204 108
S&P 500 100 111 165 195
RUSSELL 2000 100 100 142 118
S&P AEROSPACE/DEFENSE 100 103 121 86
</TABLE>
14
<PAGE>
PROPOSAL NO. 2 - APPROVAL OF AMENDMENT TO 1996 STOCK OPTION PLAN
Triumph's 1996 Stock Option Plan currently authorizes the issuance of
options to purchase up to 518,750 shares of Common Stock. In May 1999, the board
amended the 1996 stock option plan, subject to stockholder approval, to increase
the aggregate number of shares authorized for issuance upon exercise of options
granted under this plan to 1,268,750. This amendment is designed to enhance the
flexibility of the administering committee in granting stock options to
Triumph's officers and other key employees and to ensure that Triumph can
continue to grant stock options to these persons at levels determined to be
appropriate by the committee.
GENERAL
The 1996 stock option plan provides for the grant to officers and other
key employees of Triumph and its subsidiaries, approximately 150 persons, both
qualified and non-qualified options to purchase up to 518,750 shares of common
stock. If the amendment is adopted by the stockholders, the number of shares
which may be issued upon exercise of options under this plan would increase by
750,000 shares to 1,268,750 shares. No officer or key employee may be granted
options for more than 100,000 shares of Common Stock during any calendar year.
PURPOSE
The purpose of the plan is to assist Triumph and its subsidiaries in
attracting and retaining valued employees by offering them a greater stake in
Triumph's success and a closer identity with it, and to encourage ownership of
Triumph's common stock by these employees.
EFFECTIVENESS
The amendment to the plan will become effective if it receives the
favorable vote of a majority of shares of Common Stock and Class D Common Stock
entitled to vote at the meeting, voting together as a class.
ADMINISTRATION
The plan is administered by a committee designated by the board
consisting of at least two members of the board.
EXERCISE OF OPTIONS
The price for options granted under the plan is determined by the
committee at the time of grant but may not be less than the closing price of
Triumph's common stock on the NYSE on the day preceding the grant. Options
become exercisable as determined by the committee. The committee determines the
term of options but no term may exceed 10 years. The committee determines, at
the time of grant or thereafter, that any option may be accelerated upon the
death, retirement or disability of the optionee. If an optionee is no longer
employed by Triumph or any subsidiary for any reason other than death,
retirement or disability, the options held by that optionee terminate 30 days
after termination of employment.
The price payable upon exercise of options may be paid in cash or, with
the consent of the committee,
15
<PAGE>
in shares of common stock held by the optionee or by a reduction in the number
of shares otherwise issued upon exercise, with the shares in either case valued
at the date of exercise.
TRANSFERABILITY
Optionees may not transfer options, except by will or the laws of
inheritance. An option may be exercised, during the optionee's lifetime, only by
the optionee.
CHANGES IN THE COMMON STOCK OF TRIUMPH
If the outstanding common stock is increased or decreased as a result
of a stock split or the payment of a stock dividend or otherwise, an appropriate
and proportionate adjustment will be made in the number of shares covered by
each outstanding option and the purchase price of the shares.
OPTIONS OUTSTANDING, EXERCISABLE AND AVAILABLE FOR FUTURE GRANT
As of March 31, 1999, options to purchase 383,226 shares of Common
Stock were outstanding under the 1996 stock option plan, of which, 118,514
options were exercisable. The exercise price for the outstanding options ranged
from $19.00 to $44.875 per share. On March 31, 1999, the closing price of
Triumph's Common Stock on the NYSE was $23.50 per share. At March 31, 1999,
options to purchase 135,524 shares (plus any options that expire or are
cancelled in the future) were available for future grant exclusive of 750,000
additional shares covered by the proposed amendment.
FEDERAL INCOME TAX CONSEQUENCES
INCENTIVE STOCK OPTIONS. An optionee will not be deemed to receive any
income at the time an incentive stock option is granted or exercised under the
plan. (However, special rules apply to optionees who are subject to the
alternative minimum tax.) If an optionee does not dispose of the shares acquired
upon exercise of the underlying option for two years after grant of the option
and one year after exercise of the option, the gain (if any) on a subsequent
sale (the amount received less the exercise price) or loss (if any) on a
subsequent sale (the exercise price less the amount received) will be a
long-term capital gain or loss.
If the optionee disposes (whether by sale, exchange or gift) of the
shares acquired upon exercise within two years after the date of grant or within
one year after exercise of the option, the disposition is a "disqualifying
disposition," and the optionee will recognize income in the year of the
"disqualifying disposition" equal to the amount received for the shares less the
exercise price. Of that income, the portion equal to the excess of the fair
market value of the shares at the time the option was exercised over the
exercise price will be treated as compensation taxable as ordinary income (for
which Triumph will be entitled to a tax deduction, subject to any applicable Tax
Code limitation, in the year of the "disqualifying disposition") and the
balance, if any, will be long-term or short-term capital gain depending on
whether the shares were sold more than one year after the option was exercised.
However, in the case of a "disqualifying disposition" that is a sale or exchange
(other than a sale or exchange by persons related to the optionee), the amount
of compensation income recognized by the optionee will not exceed the excess of
the amount received over the exercise price, even where the amount received is
less than the fair market value of the shares at the time the option was
exercised. If an optionee uses shares acquired upon exercise of an option to
exercise that option at a time when the sale of the shares would constitute a
"disqualifying disposition," the optionee will recognize ordinary income in the
amount described in the preceding two sentences.
16
<PAGE>
NON-QUALIFIED STOCK OPTIONS. An optionee will not be considered to
receive any income at the time a non-qualified stock option is granted, nor will
Triumph be entitled to a deduction. However, when the option is exercised, the
optionee will be considered to have received compensation taxable as ordinary
income in an amount equal to the difference between the exercise price of the
option and the fair market value of the shares received upon exercise.
If a director or executive officer exercises an option within six
months of the date of grant, the recognition of income will be delayed until the
shares may be resold without incurring liability under the securities laws
(generally six months after the date of grant of the option). In that case,
ordinary income will be determined upon recognition, based on the fair market
value of the shares on that date. However, if a director or executive officer
files an appropriate election under the Tax Code with the IRS within 30 days of
his or her exercise of the option, the optionee will be deemed to have received
compensation taxable as ordinary income for the difference between the exercise
price and the fair market value on the date of exercise of the shares received.
Triumph will (subject to any applicable Tax Code limitation) be
entitled to a tax deduction for compensation taxable as ordinary income
recognized by the optionee.
Upon the sale of shares received upon exercise of an option, any gain
(the amount received less the fair market value of the shares on the date
ordinary income was recognized) or loss (the fair market value of the shares on
the date ordinary income was recognized less the amount received) will be a
long-term capital gain or loss if the sale occurs more than one year after the
date of exercise (or, if later, the date when income was recognized by the
optionee) and otherwise will be a short-term capital gain or loss.
If all or any part of the exercise price of the option is paid by the
optionee with shares of common stock (including shares previously acquired upon
exercise of an option), no gain or loss will be recognized on the shares
surrendered in payment. Shares received on exercise of the option equal to the
number of shares surrendered will have the same basis and holding period, for
purposes of determining whether future dispositions result in long-term or
short-term capital gain or loss, as the basis and holding period of the shares
surrendered. The balance of the shares received on exercise will be treated for
federal income tax purposes as described in the preceding paragraphs as though
issued upon exercise for a purchase price equal to the consideration, if any,
paid by the optionee in cash. The optionee's compensation, which is taxable as
ordinary income upon exercise, and Triumph's deduction will not be affected
whether the exercise price is paid in cash or in shares of common stock.
THIS GENERAL DESCRIPTION OF THE POSSIBLE FEDERAL INCOME TAX
CONSEQUENCES OF EXERCISING OPTIONS OR SELLING SHARES PURCHASED THROUGH THE
EXERCISE OF OPTIONS IS BASED ON THE TAX CODE, AS IT HAS BEEN INTERPRETED TO DATE
AND THEREFORE MAY NOT BE A SUFFICIENT DESCRIPTION OF THE CONSEQUENCES IF THERE
WERE A CHANGE IN THE TAX CODE AS IT IS CURRENTLY WRITTEN OR INTERPRETED. BECAUSE
THE CONSEQUENCES MAY VARY WITH EACH OPTIONEE, IT IS RECOMMENDED THAT OPTIONEES
CONSULT WITH THEIR OWN TAX ADVISORS TO DETERMINE THE TAX CONSEQUENCES, INCLUDING
STATE, LOCAL OR NON-U.S. INCOME TAX CONSEQUENCES.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE APPROVAL OF THE
AMENDMENT TO THE TRIUMPH GROUP, INC. 1996 STOCK OPTION PLAN.
17
<PAGE>
PROPOSAL NO. 3 - RATIFICATION OF SELECTION OF AUDITORS
The board has selected Ernst & Young LLP as Triumph's independent
auditors for the fiscal year ending March 31, 2000 and the stockholders are
asked to ratify this selection. Ernst & Young LLP has advised Triumph that it
has no direct or material indirect interest in Triumph or its affiliates.
Representatives of Ernst & Young LLP are expected to attend the meeting, will
have the opportunity to make a statement if they desire to do so and are
expected to be available to respond to appropriate questions.
The favorable vote of a majority of shares of Common Stock and Class D
Common Stock entitled to vote at the meeting, voting together as a class, is
required to approve the ratification of the selection of auditors.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE RATIFICATION OF
ERNST & YOUNG LLP AS INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING MARCH 31,
2000.
GENERAL AND OTHER MATTERS
The board knows of no matter, other than as referred to in this proxy
statement, which will be presented at the meeting. However, if other matters
properly come before the meeting, or any of its adjournments, the person or
persons voting the proxies will vote them with their judgment in those matters.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires Triumph's directors,
officers (including a person performing a principal policy-making function) and
persons who own more than 10% of a registered class of Triumph's equity
securities to file with the SEC initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of Triumph.
Directors, officers and 10% holders are required by SEC regulations to furnish
Triumph with copies of all of the Section 16(a) reports they file. Based solely
upon a review of the copies of the forms furnished to Triumph and the
representations made by the reporting persons to Triumph, Triumph believes that
during the fiscal year ended March 31, 1999, its directors, officers and 10%
holders complied with all filing requirements under Section 16(a) of the
Exchange Act except Claude Kronk, a director of Triumph, who failed to timely
file a Statement of Changes in Beneficial Ownership on Form 4 for both direct
and indirect purchases of shares of Common Stock in August 1998, December 1998
and March 1999.
STOCKHOLDER PROPOSALS -- 1999 ANNUAL MEETING
Proposals of stockholders intended to be presented at the annual
meeting of stockholders in 2000 must be received by March 2, 2000 to be
considered for inclusion in Triumph's proxy statement and form of proxy relating
to that meeting. If any stockholder wishes to present a proposal to the 2000
annual meeting of stockholders that is not included in Triumph's proxy statement
for that meeting and fails to submit such proposal to the Secretary of Triumph
on or before May 16, 2000, then Triumph will be allowed to use its discretionary
voting authority when the proposal is raised at the annual meeting, without any
discussion of the matter in its proxy statement. Stockholder proposals should be
directed to the Corporate Secretary, at the address of Triumph set forth on the
first page of this proxy statement.
By order of the board of directors,
/s/ Richard M. Eisenstaedt
------------------------------------
Richard M. Eisenstaedt
Secretary
June 30, 1999
18
<PAGE>
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
TRIUMPH GROUP, INC.
The undersigned hereby appoints Richard C. Ill and John R. Bartholdson
as proxies, with power to act without the other and with power of
substitution, and hereby authorizes them to represent and vote, as designated
on the other side, all the shares of stock of Triumph Group, Inc. standing in
the name of the undersigned with all powers which the undersigned would
possess if present at the Annual Meeting of Stockholders of the Company to be
held on July 28, 1999 or any adjournments thereof.
(CONTINUED, AND TO BE MARKED, DATED AND SIGNED, ON THE OTHER SIDE)
- -------------------------------------------------------------------------------
--FOLD AND DETACH HERE--
<PAGE>
<TABLE>
<S> <C>
IF NO DIRECTION IS MADE WITH RESPECT TO THE ELECTION OF DIRECTORS OR IF YOU VOTE "FOR" Please Mark /X/
THE ELECTION OF THE NOMINEES AS DIRECTORS, THE PROXIES WILL ALLOCATE VOTES IN THEIR your votes as
DISCRETION AMONG THE NOMINEES, UNLESS OTHERWISE SPECIFIED. indicated in
this sample
1. ELECTION AS DIRECTORS THE BOARD RECOMMENDS A VOTE "FOR" THE FOLLOWING DIRECTORS:
FOR all nominees WITHHOLD Nominees: Richard C. Ill, John R. Bartholdson, Claude F. Kronk,
listed to the right AUTHORITY Richard C. Gozon, Joseph M. Silvestri, Michael A. Delaney and
(except for those nominees to vote for all nominees William O. Albertini.
I have crossed-out) listed to the right
To distribute your votes on a cumulative basis, write below the
/ / / / name(s) of the nominee(s) you wish to vote for and the number
of votes you wish to cast for each.
---------------------------------------------------------------
If no direction is made with respect to Proposal 2 or 3, the proxies will vote "FOR" such proposal.
The Board recommends a vote "FOR" proposal 2.
2. Approve an amendment to The Triumph Group, Inc. 1998 Stock Option Plan to increase to 1,268,750 the number of shares issuable
upon exercise of options granted under the plan, an increase of 750,000 shares.
FOR AGAINST ABSTAIN
/ / / / / /
The Board recommends a vote "FOR" proposal 3.
3. Ratify appointment of Ernst & Young LLP as independent auditors.
FOR AGAINST ABSTAIN
/ / / / / /
Signature Signature Date
------------------------------------------ --------------------------------------- --------------------------
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such.
- ---------------------------------------------------------------------------------------------------------------------------------
--FOLD AND DETACH HERE--
</TABLE>
