SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
OMNIQUIP INTERNATIONAL, INC.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
[OMNIQUIP INTERNATIONAL LOGO]
January 9, 1998
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
which will be held at the Milwaukee Athletic Club, 758 North Broadway,
Milwaukee, Wisconsin 53202 at 10:00 a.m., Central Standard Time, on Tuesday,
February 10, 1998. On the following pages you will find the formal Notice of
Annual Meeting of Stockholders and Proxy Statement.
Whether or not you plan to attend the meeting in person, it is important
that your shares be represented and voted at the meeting. Accordingly, please
date, sign and return the enclosed proxy card promptly.
We hope that you will attend the meeting and look forward to seeing you
there.
Sincerely,
/s/ Donald E. Nickelson
Donald E. Nickelson
Chairman of the Board
/s/ P. Enoch Stiff
P. Enoch Stiff
President and Chief Executive Officer
<PAGE>
OMNIQUIP INTERNATIONAL, INC.
--------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Tuesday, February 10, 1998
--------------------------------
To the Stockholders of
OmniQuip International, Inc.:
The Annual Meeting of Stockholders of OmniQuip International, Inc., a
Delaware corporation (the "Company"), will be held at the Milwaukee Athletic
Club, 758 North Broadway, Milwaukee, Wisconsin 53202 on Tuesday, February 10,
1998, at 10:00 a.m., Central Standard Time, for the following purposes:
(1) To elect three Class II directors, each to serve until the Annual
Meeting of Stockholders in 2001 or until his successor is elected and
qualified;
(2) To ratify or reject the appointment of Price Waterhouse LLP as
independent auditors of the Company for the fiscal year ending September
30, 1998; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof, according to the proxies' discretion,
and in their discretion.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on December 29, 1997
are entitled to notice of and to vote at the meeting. A list of stockholders of
the Company at the close of business on December 29, 1997 will be available for
inspection during normal business hours during the ten days prior to the meeting
at the offices of the Company at 222 East Main Street, Port Washington,
Wisconsin 53074 and will also be available at the meeting.
By Order of the Board of Directors,
/s/ Philip G. Franklin
Philip G. Franklin
Vice President - Finance, Chief Financial Officer,
Treasurer and Secretary
Port Washington, Wisconsin
January 9, 1998
PLEASE FILL OUT, DATE AND SIGN THE ENCLOSED FORM OF PROXY AND RETURN IT IN THE
ACCOMPANYING POSTAGE PAID ENVELOPE, EVEN IF YOU PLAN TO ATTEND THE MEETING. YOU
MAY REVOKE YOUR PROXY IN WRITING, OR AT THE ANNUAL MEETING IF YOU WISH TO VOTE
IN PERSON.
<PAGE>
OMNIQUIP INTERNATIONAL, INC.
222 East Main Street
Port Washington, Wisconsin 53074
--------------------------------
PROXY STATEMENT
--------------------------------
ANNUAL MEETING OF STOCKHOLDERS
Tuesday, February 10, 1998
--------------------------------
SOLICITATION AND REVOCATION OF PROXIES
The enclosed proxy is solicited by the Board of Directors of OmniQuip
International, Inc., a Delaware corporation (the "Company"), for use at the
Annual Meeting of Stockholders (the "Annual Meeting") to be held at 10:00 a.m.,
Central Standard Time, Tuesday, February 10, 1998, or at any adjournment
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting of Stockholders. The Annual Meeting will be held at the Milwaukee
Athletic Club, 758 North Broadway, Milwaukee, Wisconsin 53202. The proxy is
revocable at any time prior to its exercise by delivering to the Company a
written notice of revocation or a duly executed proxy bearing a later date or by
attending the Annual Meeting and voting in person.
This proxy material is first being sent to stockholders on or about
January 9, 1998.
OUTSTANDING SHARES AND VOTING RIGHTS
Stockholders of record at the close of business on Monday, December 29,
1997 are entitled to notice of and to vote at the Annual Meeting. As of the
close of business on that date, there were outstanding and entitled to vote
14,260,000 shares of common stock, $0.01 par value ("Common Stock"), each of
which is entitled to one vote. No cumulative voting rights exist under the
Company's Restated Certificate of Incorporation. For information regarding the
ownership of the Company's Common Stock by holders of more than five percent of
the outstanding shares and by the management of the Company, see "Security
Ownership of Certain Beneficial Owners and Management."
For purposes of determining the presence of a quorum and counting votes
on the matters presented, shares represented by abstentions and "broker
non-votes" will be counted as present, but not as votes cast, at the Annual
Meeting. Under Delaware law and the Company's Amended By-laws, the election of
directors at the Annual Meeting will be determined on the basis of a percentage
of votes cast at the Annual Meeting and requires the affirmative vote of the
holders of a plurality of the Company's Common Stock represented and voting at
the Annual Meeting for approval. All other matters expected to be submitted for
consideration at the Annual Meeting require the affirmative vote of the holders
of a majority of the Company's Common Stock represented and voting at the Annual
Meeting for approval.
ELECTION OF DIRECTORS
Pursuant to the Company's Restated Certificate of Incorporation, the
Board of Directors is divided into three classes (Class I, Class II and Class
III), with all classes as nearly equal in number as possible. One class of
directors is ordinarily elected at each Annual Meeting for a three-year term or
until their successors are duly elected and qualified. The stockholders will
vote at the Annual Meeting for the election of three Class II directors
<PAGE>
for a three-year term expiring at the Annual Meeting of Stockholders in 2001 or
until their successors are duly elected and qualified. Peter S. Finley, Jeffrey
L. Fox and Jerry E. Ritter have been nominated by the Board for election as
Class II directors at the Annual Meeting. The Board currently consists of nine
members and there are no family relationships among any directors or executive
officers of the Company.
The persons named in the enclosed proxy will vote for the election of
the nominees named below unless authority to vote is withheld. All nominees have
consented to serve if elected. In the event that any of the nominees should be
unable to serve, the persons named in the proxy will vote for such substitute
nominee or nominees as they, in their discretion, shall determine. The Board of
Directors has no reason to believe that any nominee named herein will be unable
to serve.
The Board of Directors recommends voting "FOR" each of the nominees
named below.
The following material contains information concerning the nominees for
election as directors and the other directors of the Company.
<TABLE>
<CAPTION>
Nominees for Directors
Class II (Term of Office Expires 2001) Age Principal Occupation Director Since
- - -------------------------------------- --- -------------------- --------------
<S> <C> <C> <C>
Peter S. Finley ..................... 42 Senior Managing Director of Harbour Group August 1995
Industries, Inc., St. Louis, Missouri
Jeffrey L. Fox ..................... 37 Vice Chairman - Operations of Harbour Group September 1996
Ltd., St. Louis, Missouri
Jerry E. Ritter ..................... 62 Chairman of the Board of Clark Enterprises, April 1997
Inc., St. Louis, Missouri
Continuing Directors
Class I (Term of Office Expires 2000) Age Principal Occupation Director Since
- - ------------------------------------- --- -------------------- --------------
Paul W. Jones ...................... 49 President and Chief Executive Officer of April 1997
Greenfield Industries, Inc., Augusta, Georgia
Donald E. Nickelson ................. 65 Chairman of the Board of the Company, Port September 1996
Washington, Wisconsin and Vice Chairman of
Harbour Group Industries, Inc., St. Louis,
Missouri
P. Enoch Stiff ..................... 50 President and Chief Executive Officer of the September 1996
Company, Port Washington, Wisconsin
Class III (Term of Office Expires 1999) Age Principal Occupation Director Since
- - --------------------------------------- --- -------------------- --------------
Samuel A. Hamacher ................... 45 Executive Vice President of Harbour Group August 1995
Industries, Inc., St. Louis, Missouri
Joseph F. Shaughnessy ............... 62 President, Chief Executive Officer and Chairman April 1997
of the Board of BSI Constructors Inc.,
St. Louis, Missouri
Robert L. Virgil .................... 63 Principal of Edward Jones & Co., St. Louis, April 1997
Missouri
</TABLE>
Except as set forth below, each of the nominees and the other directors has
been engaged in his principal occupation during the past five years.
2
<PAGE>
Mr. Finley has been Senior Managing Director since 1997 and Senior Vice
President - Corporate Development since 1990 of Harbour Group Industries, Inc.
("Harbour Group"), a company which provides corporate development services to
its affiliates. From 1985 to 1990, he served as Vice President of Harbour Group.
In addition, Mr. Finley from time to time has held various officer positions
with operating companies owned by affiliates of Harbour Group. Mr. Finley was
elected a director of the Company in August 1995.
Mr. Fox has been Vice Chairman - Operations of Harbour Group Ltd. ("HGL")
(an affiliate of Harbour Group which provides operations management services to
manufacturing affiliates of Harbour Group) since September 1997. Mr. Fox served
as Group President of HGL from 1995 until September 1997. Mr. Fox previously
served as President of Engineered Polymers Corporation (a manufacturer of
plastic material handling products) from 1992 to 1995 and as President of Size
Control Company (a manufacturer of precision gauges) from 1989 to 1992, both of
which were affiliates of Harbour Group. Mr. Fox was elected a director of the
Company in September 1996.
Mr. Ritter has been a consultant to Anheuser-Busch Companies, Inc. and
Chairman of the Board of Clark Enterprises, Inc., the general partner of the
Kiel Center and the St. Louis Blues Hockey Club, since July 1996. From March
1990 to June 1996, he served as Executive Vice President and Chief Financial and
Administrative Officer for Anheuser-Busch Companies, Inc. Mr. Ritter currently
serves as a director of The Earthgrains Company, Brown Group, Inc., and The
O'Gara Company and as a trustee of the NationsBank Private Client Services
Board. Mr. Ritter was elected a director of the Company in April 1997.
Mr. Jones has been the President of Greenfield Industries, Inc. since
November 1989 and its Chief Executive Officer since May 1993. From 1988 to 1989,
he served as General Manager - Manufacturing for General Electric Transportation
Systems. Prior to that time, Mr. Jones was the General Manager of General
Electric Drives, Motor and Generator Operations. Mr. Jones was elected a
director of the Company in April 1997.
Mr. Nickelson has been the Vice Chairman of Harbour Group since 1991. From
1988 to 1990, he served as President of PaineWebber Group (an investment banking
and brokerage firm). Mr. Nickelson currently serves as a trustee of The Mainstay
Funds and as a director of Carey Diversified LLC, Allied Healthcare Products,
Inc. and Sugen, Inc. Mr. Nickelson was elected a director of the Company in
September 1996.
Mr. Stiff has been the President and Chief Executive Officer of the Company
since September 1996 and the President and Chief Executive Officer of TRAK
International, Inc. ("TRAK"), now a wholly-owned subsidiary of the Company,
since August 1989. He previously served as the Chief Operating Officer of TRAK
from November 1987 to August 1989. Prior to joining TRAK, Mr. Stiff served from
1985 to 1987 as Vice President and General Counsel of Atwood & Morrill Co., Inc.
(a manufacturer of specialty valves for the utility industry) and as a division
counsel with AMCA International (predecessor to United Dominion Industries,
Inc., a diversified manufacturer) from 1983 to 1985. Mr. Stiff was elected a
director of the Company in September 1996.
Mr. Hamacher has been the Executive Vice President of Harbour Group, in
charge of corporate development, since January 1992. From January 1988 to
January 1992, he was the Vice President - Finance of HGL. Mr. Hamacher currently
serves as a director of Allied Healthcare Products, Inc. Mr. Hamacher was
elected a director of the Company in August 1995.
Mr. Shaughnessy has been President, Chief Executive Officer and Chairman of
the Board of BSI Constructors Inc., a general contractor and construction
manager, since 1989, a company which he co-founded in 1972 and for which he
served as President from 1974 to 1989. Mr. Shaughnessy is a member of the
advisory board of NationsBank, N.A. in St. Louis, Missouri. Mr. Shaughnessy was
elected a director of the Company in April 1997.
Mr. Virgil has been a principal of Edward Jones & Co., a retail investment
firm, since September 1993. He previously served as a professor of accounting at
the John M. Olin School of Business, Washington University, St. Louis, Missouri
from 1964 to September 1993 and was dean of the School of Business from 1978 to
1993 and Executive Vice Chancellor of University Relations from 1992 to 1993. He
is currently a member of the Board of Directors of CPI Corporation, General
American Life Insurance Company and Maritz, Inc. Mr. Virgil was elected a
director of the Company in April 1997.
3
<PAGE>
Board Meetings-Committees of the Board
The Board of Directors of the Company held eight meetings during the fiscal
year ended September 30, 1997. The Board of Directors presently maintains an
Executive Committee, an Audit Committee, a Compensation and Options Committee,
an Incentive Plan Committee and a Nominating Committee.
The Executive Committee consists of Messrs. Fox, Hamacher, Jones, Nickelson
and Stiff. The Executive Committee exercises all powers of the Board of
Directors, to the extent permitted by law, between meetings of the Board. The
Executive Committee was formed in April 1997 and held two meetings during the
fiscal year ended September 30, 1997.
The Audit Committee consists of Messrs. Jones, Ritter, Shaughnessy and
Virgil. This committee recommends engagement of the Company's independent
auditors and is primarily responsible for approving the services performed by
the Company's independent auditors and for reviewing and evaluating the
Company's accounting principles and its systems of internal accounting controls.
The Audit Committee was formed in April 1997 and held one meeting during the
fiscal year ended September 30, 1997.
The Compensation and Options Committee consists of Messrs. Finley,
Hamacher, Nickelson, Ritter and Shaughnessy. This committee reviews and approves
the Company's executive compensation policy, makes recommendations concerning
the Company's employee benefit policies and exercises such powers and makes such
other compensation-related determinations as are entrusted to it by the Board of
Directors. The Compensation and Options Committee was formed in April 1997 and
held two meetings during the fiscal year ended September 30, 1997.
The Incentive Plan Committee consists of Messrs. Ritter and Shaughnessy.
This committee administers the Company's 1996 Long-Term Incentive Plan (the
"Long-Term Incentive Plan") and exercises such powers and makes such
determinations as are entrusted to it in the Long-Term Incentive Plan. The
Incentive Plan Committee was formed in April 1994 and held two meetings during
the fiscal year ended September 30, 1997.
The Nominating Committee consists of Messrs. Hamacher, Nickelson and
Virgil. The Nominating Committee, which was formed in April 1997 and did not
meet during the fiscal year ended September 30, 1997, recommends nominees for
election to the Board of Directors. The Nominating Committee will consider
nominees submitted by stockholders for inclusion on the recommended list of
nominees submitted by the Company and voted on at the Annual Meeting of
Stockholders in 1999 if such nominations are submitted in writing to the
Company's headquarters, Attention: Nominating Committee, no later than September
11, 1998.
During the fiscal year ended September 30, 1997 no director attended fewer
than 75% of the aggregate of (i) the total number of meetings of the Board of
Directors (held during the period for which he has been a director) and (ii) the
total number of meetings held by all committees of the Board of Directors on
which he served (during the periods that he served).
4
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Holders of More Than Five Percent Beneficial Ownership
The following table sets forth information regarding all persons known to
the Company to be the beneficial owners of more than five percent of the
Company's Common Stock as of December 29, 1997.
<TABLE>
<CAPTION>
Shares Owned Percent of
Name and Address of Beneficial Owner Beneficially Outstanding Shares
- - ------------------------------------ ------------ ------------------
<S> <C> <C>
Harbour Group Investments III, L.P. (1)(3) 3,700,800 26.0%
7701 Forsyth Boulevard, Suite 600
St. Louis, Missouri 63105
Uniquip - HGI Associates, L.P. (2)(3) 432,205 3.0%
7701 Forsyth Boulevard, Suite 600
St. Louis, Missouri 63105
</TABLE>
- - -----------------
(1) Information obtained from beneficial owner. Harbour Group Investments III,
L.P. ("Investments L.P.") is a Delaware limited partnership whose general
partner is Harbour Group III Management Co., L.P., a Delaware limited
partnership whose general partner is HGM III Co., a Delaware corporation
controlled by Sam Fox.
(2) Information obtained from beneficial owner. Uniquip - HGI Associates, L.P.
("Uniquip L.P.") is a Delaware limited partnership whose general partner is
Harbour Group Industries, Inc., a Delaware corporation controlled by Sam
Fox.
(3) Investments L.P. and Uniquip L.P. are under the common control of Sam Fox.
Consequently, Sam Fox may be construed as the beneficial owner of 4,133,005
shares (or 29.0% of the outstanding shares).
Beneficial Ownership of Management and Nominees
The following table sets forth information regarding the ownership of
Common Stock of the Company for each director, each executive officer named in
the Summary Compensation Table and all directors and executive officers as a
group as of December 29, 1997.
<TABLE>
<CAPTION>
Shares Owned Percent of
Name of Beneficial Owner Beneficially Outstanding Shares
- - ------------------------ ------------ ------------------
<S> <C> <C>
Peter S. Finley (1).................................................... 10,000 *
Jeffrey L. Fox (2)..................................................... --- ---
Philip G. Franklin (3)................................................. 16,000 *
Samuel A. Hamacher (4)................................................. 5,000 *
James H. Hook (5)...................................................... 84,675 *
Paul W. Jones (6)...................................................... 2,000 *
Curtis J. Laetz (7).................................................... 84,575 *
Donald E. Nickelson (8)................................................ --- ---
Jerry E. Ritter (9).................................................... 2,500 *
Joseph F. Shaughnessy (10)............................................. 3,000 *
P. Enoch Stiff (11).................................................... 562,550 3.9%
Robert L. Virgil (12).................................................. --- ---
------------- -------------
All directors and executive officers as a group (12 persons)........... 770,300 5.4%
============= ==============
</TABLE>
- - -------------
Less than 1.0%.
(1) Represents 8,500 shares directly owned by Mr. Finley and 1,500 shares
indirectly owned by Mr. Finley as custodian for his children. Excludes
10,000 shares issuable pursuant to options granted under the 1996
Directors Non-Qualified Stock Option Plan (the "Directors Plan") which are
not currently exercisable.
5
<PAGE>
(2) Excludes 10,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
(3) Excludes 40,000 shares issuable pursuant to options granted under the
Long-Term Incentive Plan which are not currently exercisable.
(4) Excludes 10,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
(5) Excludes 15,000 shares issuable pursuant to options granted under the
Long-Term Incentive Plan which are not currently exercisable.
(6) Excludes 500 shares owned by his wife as to which Mr. Jones disclaims any
beneficial ownership and 10,000 shares issuable pursuant to options
granted under the Directors Plan which are not currently exercisable.
(7) Excludes 15,000 shares issuable pursuant to options granted under the
Long-Term Incentive Plan which are not currently exercisable.
(8) Excludes 15,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
(9) Excludes 10,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
(10) Excludes 10,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
(11) Excludes 50,000 shares issuable pursuant to options granted under the
Long-Term Incentive Plan which are not currently exercisable.
(12) Excludes 10,000 shares issuable pursuant to options granted under the
Directors Plan which are not currently exercisable.
No agreements, formal or informal, exist among the various executive
officers and directors with respect to the voting of their shares.
EXECUTIVE OFFICERS
The following provides certain information regarding the executive officers
of the Company as of December 29, 1997 who are appointed by and serve at the
pleasure of the Board of Directors.
<TABLE>
<CAPTION>
Name Age Position(s)
- - ---- --- -----------
<S> <C> <C>
P. Enoch Stiff ...................... 50 Director, President and Chief Executive Officer (1)
Philip G. Franklin .................. 46 Vice President - Finance, Chief Financial Officer, Treasurer and
Secretary (2)
James H. Hook ....................... 52 Vice President - Business Services (3)
Curtis J. Laetz ..................... 53 Vice President - Marketing and Development (4)
</TABLE>
- - ---------------
(1) See information under "Election of Directors."
(2) Mr. Franklin has been the Vice President - Finance and Chief Financial
Officer of the Company since August 1996 and of TRAK since July 1996. Prior
to joining the Company, Mr. Franklin served as Chief Financial Officer for
Monarch Marking Systems, Inc. (a manufacturer of bar code printers) from
1994 to 1996 and as Vice President - Finance for Hill Refrigeration, Inc.
(a manufacturer of refrigerated display cases) from 1990 to 1994. From 1979
to 1990, he served in various financial and general management positions
with FMC Corporation (a manufacturer of chemicals and machinery).
(3) Mr. Hook has been the Vice President - Business Services of the Company
since September 1996 and of TRAK since July 1996 and previously served as
Vice President - Finance and Chief Financial Officer of TRAK from September
1992 to July 1996. Mr. Hook previously served as Senior Vice President -
Operations for Case Credit Corporation from 1988 to 1992 and as Senior Vice
President of First Interstate Bancorp from 1982 to 1988.
(4) Mr. Laetz has been the Vice President - Marketing and Development of the
Company since September 1996 and has held a similar position with TRAK
since 1990. Prior to joining TRAK, Mr. Laetz served as Vice President -
Corporate Planning for A.O. Smith Corp. (a manufacturer of automotive
frames, water heaters and electric motors) from 1988 to 1989 and as
President of Dynapac Mfg. Co. (a compaction equipment manufacturer) from
1986 to 1987. He also previously served as Senior Vice President - Business
Development for VME N.V. (a manufacturer of wheel loaders, off-highway
trucks and excavators) from 1985 to 1986.
6
<PAGE>
The following provides certain information regarding individuals who have
been designated by the Board of Directors as executive officers of the Company,
effective January 1, 1998.
<TABLE>
<CAPTION>
Name Age Position(s)
- - ---- --- -----------
<S> <C> <C>
Robert D. Melin .................... 59 Corporate Vice President - Operations Development (1)
Paul D. Roblee ...................... 44 Senior Vice President - OmniQuip Sales (2)
Richard A. Solon .................... 44 President of Snorkel International, Inc. (3)
</TABLE>
- - -----------------
(1) Mr. Melin is the Corporate Vice President - Operations Development of the
Company. Mr. Melin served as the Vice President - Operations of the Company
from August 1996 until January 1, 1998 and has held the same position with
TRAK since 1988. Prior to joining TRAK, Mr. Melin served as Vice President
of Manufacturing of AMCA International from 1986 to 1988. He previously
spent 20 years with the General Electric Corporation in a variety of senior
operating, engineering and managerial assignments.
(2) Mr. Roblee is the Senior Vice President - OmniQuip Sales. Mr. Roblee has
served as the Vice President Sales of TRAK since 1991. He previously served
as the Director of Human Resources of TRAK from 1988 to 1991. Prior to
joining TRAK, Mr. Roblee served from 1983 to 1988 in a variety of
managerial positions with Inryco, a subsidiary of Inland Steel Company.
(3) Mr. Solon is the President of Snorkel International, Inc. ("Snorkel"), a
wholly-owned subsidiary of the Company. Prior to the Company's acquisition
of Snorkel from Figgie International Inc. ("Figgie") in November 1997, Mr.
Solon served as President of Snorkel since 1991. Mr. Solon served in
various management positions with Figgie from 1979 until 1991.
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued by the
Company for services rendered during the fiscal years indicated to the chief
executive officer and each of the Company's executive officers whose total
salary and bonus exceeded $100,000 during such fiscal year (the "Named Executive
Officers").
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Long-Term
Compensation Compensation
----------------------------------------------- -----------------------
Stock Option
Fiscal Other Annual Awards LTIP All Other
Name & Principal Position Year Salary (1) Bonus Compensation (4)(5) (In Shares) Payouts(8) Compensation
- - ------------------------- ----- ---------- ----- ------------------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
P. Enoch Stiff . . . . . 1997 $178,939 $134,924(2) $25,237(6) 275,000 $87,575 $ 1,045(9)
President and Chief 1996 174,736 102,000 9,865(6) --- --- 35,009(10)
Executive Officer 1995 166,434 67,928 2,151 --- --- 17,988(10)
Philip G. Franklin . . . 1997 145,000 332,234(3) 9,587 40,000 --- 5,482(11)
Vice President - Finance 1996 26,769 --- --- --- --- 4,155(11)
Chief Financial Officer,
Secretary(14)
James H. Hook . . . . . 1997 107,363 50,763(2) 10,244(7) 99,375 35,100 922(9)
Vice President - Business 1996 105,123 38,250 5,885(7) --- --- 13,637(12)
Services 1995 100,679 27,416 3,334 --- --- 6,663(12)
Curtis J. Laetz . . . . 1997 106,837 50,563(2) 10,260(7) 99,375 36,099 916(9)
Vice President - Marketing 1996 104,606 38,063 4,714(7) --- --- 13,569(13)
and Development 1995 101,499 28,787 3,378 --- --- 7,837(13)
</TABLE>
- - ------------------
(1) Includes amounts deferred under the 401(k) feature of the Company's
Retirement Income Savings Plan.
(2) Includes a non-recurring bonus paid in connection with the Company's
initial public offering.
7
<PAGE>
(3) Includes a non-recurring signing bonus and non-recurring bonuses paid in
connection with the Company's initial public offering.
(4) Excludes certain personal benefits, the total value of which was less than
10% of the total annual salary and bonus for each of the executives.
(5) Includes amounts contributed by the Company under the Company's Retirement
Income Savings Plan.
(6) Includes bonuses of $15,961 in fiscal 1997 and $4,504 in fiscal 1996 paid
to reimburse the interest cost on a promissory note used to purchase
certain shares of Common Stock. See "Certain Transactions - Agreements with
Existing Stockholders."
(7) Includes bonuses of $5,611 in fiscal 1997 and $1,584 in fiscal 1996 paid to
reimburse the interest cost on promissory notes used to purchase certain
shares of Common Stock. See "Certain Transactions - Agreements with
Existing Stockholders."
(8) Reflects amounts paid out under a deferred compensation plan which
permitted the senior management and directors to defer 25% of their annual
bonus for a period of three years. This arrangement was terminated in
fiscal 1996.
(9) Reflects amount paid for premiums on a life insurance policy.
(10) Reflects amounts accrued under the Company's deferred compensation plan
described in note 8 above and $1,009 and $1,006 paid in fiscal 1996 and
1995, respectively, for premiums on a life insurance policy.
(11) Reflects $142 paid in premiums on a life insurance policy in fiscal 1997
and relocation expenses of $5,340 and $4,155 paid in fiscal 1997 and 1996,
respectively.
(12) Reflects amounts accrued under the Company's deferred compensation plan
described in note 8 above and $887 and $609 paid in fiscal 1996 and 1995,
respectively, for premiums on a life insurance policy.
(13) Reflects amounts accrued under the Company's deferred compensation plan
described in note 8 above and $881 and $640 paid in fiscal 1996 and 1995,
respectively, for premiums on a life insurance policy.
(14) Mr. Franklin joined the Company as Vice President - Finance and Chief
Financial Officer of TRAK in July 1996.
Options
The following table sets forth information concerning options granted
during the fiscal year ended September 30, 1997 under the Company's stock option
plans to the Named Executive Officers.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Individual Grants
---------------------------------------------------------
Number of Potential Realizable
Securities Percentage of Total Value at Assumed
Underlying Options Granted Per Share Annual Rates of Stock
Options to Employees in Exercise Expiration Price Appreciation
Name Granted Fiscal 1997 Price Date for Option Term (3)
---- ------- ----------- ----- ---- -------------------
5% 10%
--- ---
<S> <C> <C> <C> <C> <C> <C>
P. Enoch Stiff ............ 225,000 40.0% (1) * 3/20/07 --- ---
50,000 13.7 (2) $14.00 3/20/07 $440,226 $1,115,620
Philip G. Franklin ........ 40,000 11.0 (2) 14.00 3/20/07 352,181 892,496
James H. Hook ............. 84,375 15.0 (1) * 3/20/07 --- ---
15,000 4.1 (2) 14.00 3/20/07 132,068 334,686
Curtis J. Laetz ........... 84,375 15.0 (1) * 3/20/07 --- ---
15,000 4.1 (2) 14.00 3/20/07 132,068 334,686
</TABLE>
- - ----------------
*Indicates per share exercise price is the current market price on the date of
exercise.
(1) Options to acquire a total of 562,500 shares were granted under the 1996
Executive Stock Option Plan (the "Executive Plan") in fiscal 1997, the
purpose of which was to alleviate certain adverse securities laws
consequences to the plan participants. All options granted under the
Executive Plan were exercised in April 1997. The exercise price of all
options was the current market price on the date of exercise and all
options exercised were exercised only by exchanging shares of previously
owned Common Stock. See "Certain Transactions - Agreements with Existing
Stockholders."
8
<PAGE>
(2) Options to acquire a total of 363,750 shares were granted under the
Long-Term Incentive Plan in fiscal 1997, the purpose of which is to provide
a financial incentive to key employees who are in a position to make
significant contributions to the Company. Options granted to the Named
Executive Officers were granted on the date of the Company's initial public
offering and have an exercise price equal to the initial offering price of
the Common Stock. Options become exercisable with respect to one fourth of
the shares covered thereby on each anniversary of the date of grant,
commencing on the second anniversary of such date.
(3) Potential realizable value is calculated based on an assumption that the
price of the Company's Common Stock appreciates at the annual rate shown
(5% and 10%), compounded annually, from the date of grant of the option
until the end of the option term. The value is net of the exercise price
but is not adjusted for the taxes that would be due upon exercise. The 5%
and 10% assumed rates of appreciation are mandated by the rules of the
Securities and Exchange Commission (the "SEC") and do not in any way
represent the Company's estimate or projection of future stock prices.
The following table sets forth information concerning option exercises and
the value of unexercised options held by the Named Executive Officers as of
September 30, 1997.
<TABLE>
<CAPTION>
Aggregated Option Exercises in Fiscal Year 1997 and
Fiscal Year-End Option Values
Value of Unexercised,
Number of Unexercised In-the Money
Options at Options at
September 30, 1997 September 30, 1997
---------------------------- -----------------------------
Shares
Acquired
on Value
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- - ----------------------------------- ------------ ----------- ------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
P. Enoch Stiff . . . . . . . . . 225,000 0 (1) --- 50,000 --- $218,750(2)
Philip G. Franklin. . . . . . . . --- --- --- 40,000 --- 175,000(2)
James H. Hook. . . . . . . . . . 84,375 0 (1) --- 15,000 --- 65,625(2)
Curtis J. Laetz . . . . . . . . . 84,375 0 (1) --- 15,000 --- 65,625(2)
</TABLE>
- - ----------------
(1) The options exercised by these officers were exercisable at the current
market price on the date of exercise and all options were exercised only by
exchanging shares of previously owned Common Stock. See "Certain
Transactions - Agreements with Existing Stockholders."
(2) Calculated on the basis of the closing bid price of $183/4 on September 30,
1997 and an exercise price per share of $14.00 for options held by each of
these officers.
Compensation Committee Interlocks and Insider Participation
Prior to the Company's initial public offering, the Company did not have a
compensation committee. Following the acquisition of TRAK, executive
compensation had been determined by the entire Board of Directors, which until
September 30, 1996 consisted of Samuel A. Hamacher, James C. Janning and Peter
S. Finley. Prior to the acquisition of TRAK, executive compensation had been
determined by TRAK's then-constituted Board of Directors. Prior to the Company's
initial public offering, Messrs. Hamacher, Janning and Finley also served as
Executive Vice President, President and Vice President, respectively, of the
Company. Messrs. Hamacher, Janning and Finley were not compensated for their
positions as directors or officers prior to the Company's initial public
offering. In April 1997, the Company formed a Compensation and Options
Committee, which does not include any executive officers of the Company. The
members of the Compensation and Options Committee are Messrs. Finley, Hamacher,
Nickelson, Ritter and Shaughnessy.
9
<PAGE>
Compensation of Directors
Each director who is not an employee of the Company is entitled to receive
an annual fee of $10,000 and additional fees of $750 for attendance at each
meeting of the full Board of Directors and $500 for attendance at each meeting
of a committee of the Board of Directors. Directors are also entitled to
reimbursement for their expenses incurred in attending meetings.
1996 Directors Non-Qualified Stock Option Plan. The Company maintains a
Directors Plan which provides for the granting of options to the Company's
directors who are not employees of the Company, for up to an aggregate 250,000
shares of Common Stock.
The Directors Plan, by its express terms, provided for the grant of options
thereunder to each eligible director serving on March 20, 1997, the date of the
Company's initial public offering, with respect to 10,000 shares of Common
Stock, and an additional option to the Chairman of the Board of Directors
(provided he was an eligible director) with respect to 5,000 shares of Common
Stock, in each case at the initial public offering price of $14.00 per share. In
addition, the Directors Plan provides for the grant of options to each person
first becoming an eligible director subsequent to the date of the Company's
initial public offering with respect to 10,000 shares of Common Stock and the
grant of an additional option to each person first becoming Chairman of the
Board subsequent to such date (provided such person is an eligible director)
with respect to 5,000 shares of Common Stock.
Options granted or to be granted under the Directors Plan become
exercisable over a five-year period from the date of grant. All options granted
under the Directors Plan expire ten years from the date of grant.
Options granted or to be granted under the Directors Plan are
nontransferable, and the exercise price must be equal to the fair market value
of the Common Stock on the date of grant. Upon exercise, the exercise price must
be paid in full in cash or such other consideration as the Board or any
committee thereof may permit.
Set forth below is information with respect to options outstanding under
the Directors Plan.
<TABLE>
<CAPTION>
Exercise Price
Name Date of Grant Number of Shares Per Share
- - ------------------------------------ --------------- ----------------- -------------------
<S> <C> <C> <C>
Peter S. Finley..................... 3/20/97 10,000 $14.00
Jeffrey L. Fox...................... 3/20/97 10,000 14.00
Samuel A. Hamacher.................. 3/20/97 10,000 14.00
Paul W. Jones....................... 4/10/97 10,000 13.25
Donald E. Nickelson................. 3/20/97 15,000 14.00
Jerry E. Ritter..................... 4/10/97 10,000 13.25
Joseph F. Shaughnessy............... 4/10/97 10,000 13.25
Robert L. Virgil.................... 4/10/97 10,000 13.25
</TABLE>
Except as set forth above, no options have been granted under the Directors
Plan, and no outstanding options are presently exercisable.
Indemnification and Limitation of Liability
The Company's Restated Certificate of Incorporation provides that the
Company's directors are not liable to the Company or its stockholders for
monetary damages for breach of their fiduciary duties, except under certain
circumstances, including breach of the director's duty of loyalty, acts or
omissions not in good faith or involving intentional misconduct or a knowing
violation of law or any transaction from which the director derived improper
personal benefit. The Company's By-laws provide for the indemnification of the
Company's directors and officers to the full extent permitted by the Delaware
General Corporation Law.
10
<PAGE>
Board Compensation and Options Committee Report on Executive Compensation
The Compensation and Options Committee (the "Committee"), composed entirely
of non-employee members of the Board of Directors, reviews, recommends and
approves changes to the Company's compensation policies and programs for the
chief executive officer, other senior executives and certain key employees. The
Committee also makes recommendations concerning the Company's employee benefits
policies and exercises such powers and makes such other compensation-related
determinations as are entrusted to it by the Board of Directors. The Incentive
Plan Committee, composed entirely of non-employee, independent members of the
Board of Directors, administers the Long-Term Incentive Plan and exercises the
powers entrusted to it in the Long-Term Incentive Plan.
In the Committee's discharge of its responsibilities, it considers
compensation, primarily of the chief executive officer, all other executive
officers and certain other officers, and sets overall policy and considers in
general the basis of the levels of compensation of other key employees.
Policy and Objectives. Recognizing its role as a key representative of the
stockholders, the Committee seeks to promote the interests of stockholders by
attempting to align management's remuneration, benefits and perquisites with the
economic well-being of the Company. Since the achievement of operational
objectives should, over time, represent the primary determinant of share price,
the Committee links elements of compensation of executive officers and certain
key employees with the Company's operating performance. In this way, objectives
under a variety of compensation programs should eventually reflect the overall
performance of the Company. By adherence to the above program, the compensation
process should provide for enhancement of stockholder value. Basically, the
Committee seeks the successful implementation of the Company's business strategy
by attracting and retaining talented managers motivated to accomplish these
stated objectives. The Committee attempts to be fair and competitive in its
views of compensation. Thus, rewards involve both business and individual
performance. The key ingredients of the program consist of base salary, annual
cash incentives and long-term stock-based incentives.
Base Salary. As a general principle, base salaries for the chief executive
officer, as well as other executive officers of the Company, are determined by
comparing salary data for similar positions in companies that match the
Company's size in sales and earnings. In 1997, the Committee commissioned a
study performed by an independent employee benefits consulting firm to evaluate
executive compensation at such companies. The results of this study were
considered by the Committee in setting target compensation, composed of base
salary and bonus, for the executive officers of the Company, including the chief
executive officer. Target base salary for each of the Company's executive
officers generally approximates the 50th percentile amount in the salary survey
for the corresponding position. The Committee anticipates that it will
periodically use updated versions of this study or other independent studies or
salary surveys of companies comparable to the Company as a component in the
determination of base salary for executive officers. In addition, the
performance of each executive officer of the Company, including the chief
executive officer of the Company, is evaluated annually and salary adjustments
are also based on various factors including revenue growth, earnings per share
improvement, increases in cash flow, new product development, market
appreciation for publicly traded securities, reduction of debt, personal
performance and position in the salary study or survey range.
Cash Incentive Compensation. To reward performance, the chief executive
officer and other executive officers are eligible for annual cash bonuses.
Actual bonuses for fiscal 1997 for the chief executive officer and other
executive officers of the Company were based on pre-set objectives related to
actual corporate performance and included special non-recurring bonuses related
to the successful completion of the Company's initial public offering. For
fiscal 1998, the Company has adopted a variable pay incentive plan. Incentive
compensation under the plan will be based upon a combination of overall
corporate performance and the achievement of operating goals and objectives
designed to improve the performance of the Company and enhance stockholder
value. Target bonuses for each of the Company's executive officers, including
the chief executive officer, generally approximate the 50th percentile amount in
the salary survey for the corresponding position, with the ability to earn
additional amounts based upon performance.
11
<PAGE>
Stock-Based Incentives. In September 1996, the Company established the
Long-Term Incentive Plan pursuant to which equity incentives covering up to
1,600,000 shares of Common Stock may be awarded to key officers and employees of
the Company. The Long-Term Incentive Plan is intended to promote the interests
of the Company and its stockholders by attracting and retaining exceptional
executive personnel and other key employees of the Company and its subsidiaries,
motivating such employees by means of stock options and performance-related
incentives to achieve long-range performance goals, and enabling such employees
to participate in the long-term growth and financial success of the Company. The
Long-Term Incentive Plan was administered by the Board of Directors prior to the
Company's initial public offering and thereafter by the Incentive Plan
Committee, which consists solely of two directors who are "non-employee
directors" as defined in Rule 16b-3 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") and "outside directors" as defined in Section
162(m) of the Internal Revenue Code of 1986.
The Long-Term Incentive Plan provides for the granting of four types of
awards on a stand alone, combination, or tandem basis, including incentive stock
options, non-qualified stock options, restricted shares and performance stock
awards. The Long-Term Incentive Plan provides for the award of up to a total of
1,600,000 shares of Common Stock, provided that the total number of shares with
respect to which awards are granted in any one fiscal year may not exceed
100,000 shares to any individual employee and 400,000 shares in the aggregate,
and the total number of shares with respect to which grants of restricted and
performance stock awards are made in any one fiscal year shall not exceed 50,000
shares to any individual employee and 100,000 shares in the aggregate (subject,
in each case, to adjustment in the event of a stock split, stock dividend,
combination or exchange of shares, exchange for other securities,
reclassification, reorganization, redesignation, merger, consolidation,
recapitalization, or other such change). No payments or contributions are
required to be made by the employees who participate in the Long-Term Incentive
Plan other than the payment of any purchase price upon the exercise of a stock
option.
Except as otherwise provided in the Long-Term Incentive Plan, the Board may
at any time terminate, and, from time to time, amend or modify the Long-Term
Incentive Plan. Any such action of the Board may be taken without the approval
of the Company's stockholders, but only to the extent that such stockholder
approval is not required by applicable law or regulation. Furthermore, no
amendment, modification, or termination of the Long-Term Incentive Plan shall
adversely affect any awards already granted to a participant without his or her
consent. No amendment or modification of the Long-Term Incentive Plan may change
any performance goal, or increase the benefits payable for the achievement of a
performance goal, once established for a performance stock award.
Options granted to employees during fiscal year 1997 pursuant to the
Long-Term Incentive Plan may not be exercised for a period of two years from the
date of grant and thereafter become exercisable on a cumulative basis in 25%
increments beginning on the second anniversary of the date of grant and
concluding on the fifth anniversary of the date of grant. Options granted on the
date of the Company's initial public offering have an exercise price equal to
the initial offering price of $14.00, and options granted after the Company's
initial public offering have an exercise price equal to the market price of the
Common Stock on the date of grant.
Compensation and Options Committee
Samuel A. Hamacher, Chairman
Peter S. Finley
Donald E. Nickelson
Jerry E. Ritter
Joseph F. Shaughnessy
12
<PAGE>
Performance Graph
The following table presents the cumulative return for the Company, the
CRSP Index for Nasdaq Stock Market (US Companies) and an index comprised of five
companies which the Company believes to present a representative peer group of
the Company. The Nasdaq and the peer group data have been provided by the Center
for Research in Security Prices, Chicago, Illinois, without independent
verification by the Company.
<TABLE>
<CAPTION>
Comparison of Five-Year Cumulative Total Returns
Date Company Index Market Index Peer Index
- - ---- ------------- ------------ ----------
<S> <C> <C> <C>
09/30/96 98.270 91.856
10/31/96 97.184 84.394
11/29/96 103.192 97.017
12/31/96 103.100 93.723
01/31/97 110.427 96.498
02/28/97 104.323 96.466
03/21/97 100.000 100.000 100.000
03/31/97 100.000 97.512 98.192
04/30/97 89.655 100.562 106.874
05/30/97 138.793 111.964 117.139
06/30/97 159.483 115.389 129.601
07/31/97 172.414 127.573 131.541
08/29/97 137.931 127.360 137.301
09/30/97 126.787 134.877 129.673
</TABLE>
Companies in the Self-Determined Peer Group:
<TABLE>
<S> <C>
CASE CORP. CATERPILLAR INC.
GEHL COMPANY GRADALL INDUSTRIES INC.
JLG INDUSTRIES, INC.
</TABLE>
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 3/21/97.
13
<PAGE>
CERTAIN TRANSACTIONS
Related Party Transactions
On August 16, 1995, Investments L.P., Uniquip L.P. and P. Enoch Stiff
purchased 9,225,000 shares, 1,125,000 shares and 337,500 shares, respectively,
of the Company's Common Stock for approximately $0.56 per share payable
$5,209,411.76 in cash, $600,000 in cash and $35,294.12 by a promissory note and
$190,588.24 in cash, respectively. On September 20, 1995, Mr. Stiff purchased an
additional 225,000 shares of the Company's Common Stock for approximately $0.56
per share payable $200 in cash and $126,859 by a promissory note. On September
20, 1995, James H. Hook, Curtis J. Laetz and two other officers of the Company
each purchased 84,375 shares of the Company's Common Stock for approximately
$0.56 per share payable $75 in cash and $47,572 by a promissory note.
Investments L.P. and Uniquip L.P., together the beneficial owners of
approximately 29.0% of the outstanding Common Stock, are under the common
control of Sam Fox. See "Security Ownership of Certain Beneficial Owners and
Management."
In connection with the acquisitions of TRAK and Lull Industries, Inc.
("Lull"), the Company incurred junior subordinated indebtedness evidenced by
subordinated notes (the "Subordinated Notes") in the principal amounts of
$2,000,000 and $14,000,000, respectively. Investments L.P. held the subordinated
note in the principal amount of $2,000,000 and guaranteed the Company's
obligations under the subordinated note in the principal amount of $14,000,000.
The Company repaid the entire balance of indebtedness outstanding under the
Subordinated Notes from the net proceeds received by the Company from its
initial public offering.
The Company engages HGL and Harbour Group, affiliates of Investments L.P.
and Uniquip L.P., to provide certain management consulting services to the
Company for which payments totaling $60,000, $668,000 and $601,000 were made by
the Company to HGL for the fiscal years ended September 30, 1995, 1996 and 1997,
respectively. In connection with the acquisitions of TRAK, Lull and Snorkel, the
Company paid fees to Harbour Group and affiliates of approximately $1,224,000 in
the aggregate for investment banking, corporate development and other services.
The Company has entered into an Operations Consulting and Advisory Services
Agreement (the "HGL Services Agreement") with HGL, pursuant to which HGL will
continue to provide management consulting services to the Company for a one-year
term from September 30, 1996, which term automatically renews from year to year
until terminated by the Company or HGL upon 30 days notice. Under the HGL
Services Agreement, the Company will compensate HGL for management consulting
services at HGL's approximate costs incurred in performing such services. The
Company has also entered into a Corporate Development Consulting and Advisory
Services Agreement (the "HGI Services Agreement") with Harbour Group, an
affiliate of HGL, pursuant to which Harbour Group will continue to provide
corporate development services to the Company for a one-year term from September
30, 1996, which term automatically renews from year to year until terminated by
the Company or Harbour Group upon 30 days notice. Under the HGI Services
Agreement, the Company will compensate Harbour Group for corporate development
services by paying an annual fee equal to the greater of $100,000 or Harbour
Group's approximate costs incurred in performing such services, plus a
transaction fee equal to an amount which ranges from two and one half percent of
the first $1.0 million of the purchase price to one half of one percent of the
portion of the purchase price in excess of $4.0 million for each completed
acquisition or disposition by the Company during the term of the HGI Services
Agreement, subject to a minimum fee per transaction of $125,000.
The Company was included in an insurance program maintained by HGL
providing workers compensation and employer's liability, general liability and
automobile liability and physical damage insurance coverage for all companies
controlled by Harbour Group or its affiliates. The insurance program included a
retrospective rating plan and automatic premium adjustment plan, which provided
for calculations of the premiums for the insurance program based on the
application of rating formulae to actual incurred losses and reserves for future
losses which required adjustment of the premiums retrospectively. The Company
also entered into an Insurance Agreement with HGL pursuant to which it had
agreed to reimburse HGL, and HGL had agreed to reimburse the Company, for their
respective pro rata shares of any retrospective premium adjustment. The Company
substantially ceased participation in the insurance program upon completion of
its initial public offering. The Company continued to participate in a similar
program administered by HGL providing commercial umbrella and excess umbrella
14
<PAGE>
coverage until November 1997. The Company did not experience any difficulty in
obtaining comparable insurance and the costs of such insurance have not been
materially different from that charged under the HGL program.
The Company believes that each of the related party transactions described
herein was on terms no less favorable to the Company than could have been
obtained from unaffiliated third parties.
Agreements with Existing Stockholders
As described above, Mr. Stiff, on August 16, 1995, acquired 337,500 shares
of Common Stock for $190,588.24 in cash, a price determined by the Board of
Directors of the Company. In connection with the purchase of such shares of
Common Stock, Mr. Stiff entered into an Investment Agreement with Investments
L.P. and the Company (the "Investment Agreement") providing for, among other
things, restrictions on transfer of such shares, registration rights with
respect to such shares, the grant of an option to Investments L.P. to purchase
such shares in certain circumstances, a right of first refusal for Investments
L.P. in the event of certain offers to purchase such shares, "tag-along" and
"drag-along" rights in the event of certain sales of the Common Stock by
Investments L.P., a right to acquire additional securities of the Company in
order for Mr. Stiff to maintain his percentage of equity interest in the Company
under certain circumstances and a right to make additional investments in the
Company in accordance with his pro rata share of the issued Common Stock in
certain circumstances. In connection with the Investment Agreement, Mr. Stiff
entered into a Participation Agreement with Investments L.P., pursuant to which
Mr. Stiff purchased a 3% interest in $2,000,000 in principal amount of a junior
subordinated note issued by TRAK and made payable to Investments L.P. The
Company repaid the entire balance of the indebtedness outstanding under such
subordinated note from the net proceeds received by the Company from its initial
public offering.
Also as described above, Mr. Stiff, together with Messrs. Hook, Laetz and
two other officers of the Company on September 20, 1995, acquired Common Stock
at prices determined by the Board of Directors of the Company, and the purchase
price therefor was paid partly in cash and partly by delivery of promissory
notes payable to the Company. The payment obligations of the stockholders under
their respective promissory notes are secured by all or some portion of the
purchased shares pursuant to stock pledge agreements entered into by each
stockholder and the Company. Such notes have a ten-year maturity, bear interest
at a fixed rate of interest of 6.56% per annum and are payable interest only
annually, with one principal payment at maturity. In connection with such
promissory notes, the Company agreed to pay annual bonuses to such stockholders
in amounts equal to the annual interest payments on the notes plus all federal
and state income taxes applicable to such payments. In connection with the
purchase of his shares of the Common Stock, each such stockholder entered into
an agreement with the Company (the "Stockholder Agreements") providing for,
among other things, restrictions on transfer of such shares of the Common Stock
owned by such stockholder, registration rights with respect to such shares, the
repurchase of such shares upon termination of the stockholder's employment at a
price based on a predetermined formula, a right of first refusal for the Company
in the event of certain offers to purchase such shares, a right to acquire
additional securities of the Company in order to maintain the stockholder's
percentage of equity interest in the Company in certain circumstances and
"tag-along" and "drag-along" rights in the event of certain sales of the Common
Stock by Investments L.P. The Stockholder Agreements also contain provisions
concerning noncompetition and confidentiality applicable to such stockholders
and provisions for payments to such stockholders, under certain circumstances,
following the termination of their employment with the Company.
The following directors and executive officers have promissory notes in
excess of $60,000 outstanding to the Company:
<TABLE>
<CAPTION>
Highest Principal
Principal Amount
Amount Outstanding Interest
Stockholder Position Outstanding at 12/29/97 Rate Due Date
----------- -------- ----------- ----------- -------- --------
<S> <C> <C> <C> <C> <C>
P. Enoch Stiff President, Chief Executive $126,859 $126,859 6.56% September 20, 2005
Officer and Director
</TABLE>
15
<PAGE>
The Company also adopted the Executive Plan pursuant to which options were
granted to Messrs. Stiff, Hook and Laetz to acquire 225,000, 84,375 and 84,375
shares, respectively, of Common Stock, and to the other management stockholders
to acquire an aggregate 168,750 shares of Common Stock by tendering existing
Common Stock in payment therefor. All such options were exercised in April 1997.
The exercise price of all options was the current market price on the date of
exercise and all options were exercised only by exchanging shares of previously
owned Common Stock. The Executive Plan was created solely for the purpose of
alleviating certain adverse securities laws consequences to the plan
participants. The grant and exercise of options under the Executive Plan did not
result in any increase in the beneficial ownership of Common Stock by the plan
participants from the number of shares owned immediately after the Company's
initial public offering. Under the terms of the Executive Plan, the options were
exercisable immediately after the Company's initial public offering and the
shares of Common Stock issued thereunder became freely transferable, subject to
the restrictions of the Stockholder Agreements, on the last day of the sixth
full month following the Company's initial public offering, provided a pro rata
portion of the indebtedness originally incurred to purchase the shares
surrendered upon exercise of the options is repaid. In connection with the
issuance of options under the Executive Plan, the Company agreed to amend
certain of the promissory notes issued in connection with purchases of Common
Stock to permit partial prepayments. The provisions of the Stockholder
Agreements, which are subject to modification or waiver by the Company,
generally permit the sale of 25% of such shares one year after the Company's
initial public offering, 50% of such shares two years after the Company's
initial public offering, 75% of such shares three years after the Company's
initial public offering, and all of such shares four years after the Company's
initial public offering. The Executive Plan was terminated in August 1997 by the
Board of Directors.
Registration Rights
Pursuant to a registration rights agreement among the Company, Investments
L.P. and Uniquip L.P. (the "Registration Rights Agreement"), Investments L.P.
and Uniquip L.P. and such of their respective permitted transferees as may be
deemed to be affiliates of the Company have rights to demand registration under
the Securities Act of 1993 (the "Securities Act") of its or their shares of
Common Stock. In addition, in the event the Company proposes to register any of
its securities under the Securities Act, such persons (or their permitted
transferees) will have rights, subject to certain exceptions and limitations, to
have the shares of the Company's capital stock then owned by them included in
such registration statement. The Company has agreed that, in the event of any
registration of securities owned by such persons (or a permitted transferee) in
accordance with the provisions thereof, it will indemnify such person, and
certain related persons, against liabilities incurred in connection with such
registration, including liabilities arising under the Securities Act. Pursuant
thereto, the Company and Investments L.P. entered into an Indemnification
Agreement providing for indemnification against certain potential liabilities
arising in connection with the Company's initial public offering, including
liabilities under the Securities Act.
In addition, as described above under "Certain Transactions-Agreements with
Existing Stockholders," other existing stockholders also have registration
rights, subject to certain exceptions and limitations, to have shares of the
Company's capital stock owned by them to be included in registration statements
filed by the Company under the Securities Act.
The registration rights described above are subject to certain limitations
intended to prevent undue interference with the Company's ability to distribute
securities, including the provision that demand registration rights may not be
exercised within 90 days after the effective date of the Company's most recent
registration statement.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and persons who own more than ten percent of a registered
class of the Company's equity securities to file with the SEC initial reports of
beneficial ownership and reports of changes in beneficial ownership of Common
Stock and other equity
16
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securities of the Company. Executive officers, directors and greater than ten
percent stockholders are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms which they file.
To the Company's knowledge, based solely on review of information furnished
to the Company, reports filed through the Company and representations that no
other reports were required, all Section 16(a) filing requirements applicable to
its directors, executive officers and greater than ten percent beneficial owners
were complied with during the year ended September 30, 1997, except that Philip
G. Franklin, an executive officer of the Company, failed to timely file one Form
4 relating to the purchase of 2,000 shares of Common Stock in August 1997.
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors has selected Price Waterhouse LLP to be the
independent auditors of the Company for the fiscal year ending September 30,
1998.
The Board of Directors recommends voting "FOR" approval and ratification of
such selection.
A representative of Price Waterhouse LLP is expected to be available at the
Annual Meeting to make a statement if such representative desires to do so and
to respond to appropriate questions.
SOLICITATION OF PROXIES
The cost of soliciting proxies will be borne by the Company. In addition to
solicitation by mail, proxies may be solicited by officers, directors and
regular employees of the Company personally or by telephone or facsimile for no
additional compensation. Arrangements will be made with brokerage houses and
other custodians, nominees and fiduciaries to forward solicitation material to
beneficial owners of the Common Stock held of record by such persons, and the
Company will reimburse such persons for reasonable out-of-pocket expenses
incurred by them in so doing.
STOCKHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
The rules of the SEC currently provide that stockholder proposals for the
1999 Annual Meeting must be received at the Company's principal executive office
not less than 120 calendar days prior to the anniversary date of the release of
the Company's proxy statement to stockholders in connection with the 1998 Annual
Meeting to be considered by the Company for possible inclusion in the proxy
materials for the 1999 Annual Meeting.
FINANCIAL INFORMATION
The Company's Annual Report for the fiscal year ended September 30, 1997 is
being mailed to the stockholders on or about the date of mailing this Proxy
Statement. The Company will provide, without charge, to any record or beneficial
stockholder as of December 29, 1997, who so requests in writing, a copy of such
Annual Report or the Company's Annual Report on Form 10-K (without exhibits),
including the financial statements and the financial statement schedules, filed
with the SEC. Any such request should be directed to OmniQuip International,
Inc., 222 East Main Street, Port Washington, Wisconsin 53074, Attention: Philip
G. Franklin.
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OTHER MATTERS
The Board of Directors of the Company is not aware of any other matters to
come before the meeting. If any other matters should come before the meeting,
the persons named in the enclosed proxy intend to vote the proxy according to
their best judgment.
You are urged to complete, sign, date and return your proxy to make certain
your shares of Common Stock will be voted at the Annual Meeting. For your
convenience in returning the proxy, an addressed envelope is enclosed, requiring
no additional postage if mailed in the United States.
By Order of the Board of Directors,
/s/ Philip G. Franklin
Philip G. Franklin
Vice President, Chief Financial Officer,
Treasurer and Secretary
January 9, 1998
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<PAGE>
PROXY
OMNIQUIP INTERNATIONAL, INC.
Annual Meeting of Stockholders - February 10, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY
The undersigned acknowledges receipt of the Notice of Annual
Meeting of Stockholders and Proxy Statement of OmniQuip International, Inc. (the
"Company"), each dated January 9, 1998, and appoints Philip G. Franklin and
Curtis J. Laetz, or either of them, as the proxies and attorneys-in-fact, with
full power to each of substitution on behalf and in the name of the undersigned
to vote and otherwise represent all of the shares registered in the name of the
undersigned at the 1998 Annual Meeting of Stockholders of the Company to be held
on Tuesday, February 10, 1998 at 10:00 a.m., Central Standard Time, at the
Milwaukee Athletic Club, 758 North Broadway, Milwaukee, Wisconsin 53202 and any
adjournments thereof with the same effect as if the undersigned were present and
voting such shares on the following matters and in the following manner:
1. To elect the following persons as Class II directors, each to serve until
the Annual Meeting of Stockholders in 2001 or until his successor is
elected and qualified:
Peter S. Finley, Jeffrey L. Fox and Jerry E. Ritter.
2. To ratify or reject the appointment of Price Waterhouse LLP as independent
auditors of the Company for the fiscal year ending September 30, 1998.
3. To transact such other business as may properly come before the meeting or
any adjournment thereof, according to the proxies' discretion, and in their
discretion.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR" ALL NOMINEES LISTED
IN PROPOSAL 1 AND "FOR" PROPOSAL 2.
(SEE REVERSE SIDE)
- - -------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
[X] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted in accordance with the
specification made. If no specification is made, the shares represented by this
proxy will be voted "FOR" all nominees listed in proposal 1, "FOR" proposal 2
and in the discretion of the proxies on such other business as may properly come
before the meeting.
<TABLE>
<S> <C> <C>
1. Election of 2. To ratify or reject the appointment of
Directors. (see Price Waterhouse LLP as independent
reverse side) Please mark the following box if you auditors of the Company for the fiscal
plan to attend the meeting. year ending September 30, 1998.
FOR WITHHELD FOR AGAINST ABSTAIN
[ ] [ ] [ ] [ ] [ ] [ ]
For, except vote withheld from
the following nominee(s): NOMINEES: Peter S. Finley, Jeffrey L. Fox,
and Jerry E. Ritter.
3. To transact such other business as may
- - -------------------------------- properly come before the meeting or any
adjournment thereof, according to the
proxies' discretion, and in their
discretion.
Please date and sign exactly as your
name(s) appears on the stock
certificate. If shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by president or other by
authorized officer. If a partnership,
please sign in partnership name by
authorized person. This proxy votes all
shares held in all capacities unless
otherwise specified.
</TABLE>
SIGNATURE(S) DATE
------------------------------------------ --------------------
Please mark, sign and date this proxy and return it promptly in the enclosed
envelope.
- - --------------------------------------------------------------------------------
FOLD AND DETACH HERE
