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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to d 240.14a-11(c) or d 240.14a-12
JLG INDUSTRIES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:
4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how
it was determined.
[ ] 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:
October 11, 1995
Dear Fellow Shareholder:
The Annual Meeting of Shareholders of JLG Industries, Inc. will be held on
Monday, November 20, 1995, at 4:30 p.m. at the Company's headquarters in
McConnellsburg, Pennsylvania. The Board of Directors and management urge you
to attend this Meeting to give us the opportunity to meet you personally, to
allow us to introduce you to the key personnel responsible for the
management of your Company, and to answer your questions.
At the Meeting you will be asked to elect eight directors and to ratify the
selection of independent auditors for the ensuing year. You will also
be asked to ratify an earlier amendment and consider a proposed amendment to
the Company's Articles of Incorporation to increase the Company's authorized
capital stock to thirty-five million shares.
An update on recent developments and a review of the Company's operations and
financial performance for the 1995 fiscal year will be presented at the
Meeting. In addition, we will inform you of our business plans and
expectations for the future. We will also salute the Company's co-founder,
Paul K. Shockey, who, after 26 years of faithful service, is retiring from
the Board and the position of Company Secretary.
We hope that you will be able to attend the Meeting in person. Whether or not
you plan to attend, please promptly sign, date and mail the enclosed proxy
card in the postage-paid return envelope provided. It is important that
your shares are represented and voted at the Meeting.
On behalf of the Board of Directors, I wish to thank you for your cooperation
and continued support.
Sincerely,
JLG INDUSTRIES, INC.
L. David Black
Chairman of the Board,
President and Chief Executive Officer
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Monday, November 20, 1995
The Annual Meeting of Shareholders of JLG Industries, Inc. will be held at the
Company's headquarters in McConnellsburg, Pennsylvania, on Monday, November 20,
1995, at 4:30 p.m. EST for the following purposes:
1. To elect a board of eight directors of the Company to hold office until
the next Annual Meeting of shareholders and until their successors shall
be elected and qualified.
2. To ratify the selection of independent auditors for the 1996 fiscal year.
3. To ratify an earlier amendment and consider a proposed amendment to the
Company's Articles of Incorporation to increase the Company's authorized
capital stock to thirty-five million (35,000,000) shares.
4. To transact such other business as may properly come before the Annual
Meeting or any adjournments thereof.
The Board of Directors has designated the close of business on October 11,
1995, as the record date for the determination of shareholders entitled
to vote at the Annual Meeting and any adjournments thereof.
It is important that your shares are voted at the Annual Meeting. Whether or
not you plan to attend in person, we urge you to take a moment now to
exercise your right to vote by signing, dating and mailing the proxy card(s)
found in the address pocket of the mailing envelope. If you hold shares
in more than one account, then you will receive more than one card.
Please sign, date and mail each card received to assure that all of
your shares will be represented and voted at the Annual Meeting. Your proxy
is revocable up to the time it is voted, and you may vote in person at the
Annual Meeting even though you have previously submitted proxy.
A copy of the Company's 1995 Annual Report to Shareholders is enclosed for
your review.
Paul K. Shockey
Secretary
JLG INDUSTRIES, INC.
JLG Drive
McConnellsburg, PA 17233
PROXY STATEMENT
FOR THE 1995 ANNUAL MEETING OF SHAREHOLDERS, NOVEMBER 20, 1995
GENERAL
This Proxy Statement is furnished in connection with the solicitation by and on
behalf of the Board of Directors of JLG Industries, Inc. (the "Company") of
proxies to be voted at the 1995 Annual Meeting of Shareholders of the Company
to be held at the Company's headquarters in McConnellsburg, Pennsylvania
on November 20, 1995.
A proxy may be revoked by the person giving the proxy at any time prior to the
close of voting. Prior to the Annual Meeting, a proxy may be revoked by
filing with the Secretary of the Company a written revocation or a duly
executed proxy bearing a later date. During the Annual Meeting, a proxy may
be revoked by filing a written revocation or a duly executed proxy bearing a
later date with the Secretary of the Annual Meeting prior to the close of
voting.
All expenses in connection with the solicitation of proxies will be borne by
the Company. In addition to soliciting proxies by mail, the officers,
directors, or other employees of the Company, as yet undesignated, and without
compensation other than their regular compensation, may solicit proxies in
person or by other appropriate means if authorized and if deemed advisable.
As of October 11, 1995, the record date for the Annual Meeting as set by the
Board of Directors, there were 14,309,084 shares of Capital Stock issued
and outstanding. Each share of Capital Stock entitles the holder to one
vote at the Annual Meeting. There are no other voting securities of the
Company.
This Proxy Statement is dated October 11, 1995.
ELECTION OF DIRECTORS
The persons named in the following table have been nominated by the Board of
Directors for election as directors at the Annual Meeting to hold office until
the next Annual Meeting of Shareholders and until their successors shall be
elected and qualified. Directors are elected by a plurality of the votes cast.
<TABLE>
Nominees for Directors
<CAPTION>
Director Background
Name Age Since Information
<S> <C> <C> <S>
L. David Black 58 1990 Chairman of the Board, President and Chief
Executive Officer; prior to 1993, President and
Chief Executive Officer; prior to 1991, President
and Chief Operating officer.
Charles H. Diller, Jr. 50 1984 Executive Vice President and Chief Financial
Officer.
George R. Kempton 61 1993 Chairman of the Board and Chief Executive
Officer, Krsor Industrial Corporatio. Director,
Simpson Industries, Inc. and Guardsman
Products, Inc.
James A. Mezera 65 1984 Vice President, Komatsu Dresser Company.
Gerald Palmer 50 1994 Vice President, Technical Services Division,
Caterpillar, Inc.; prior to 1992, Director of Technical
Services, Technical Services Division, Caterpillar,
Inc.; prior to 1991, President, Conek S.A. de C.V.
(Caterpillar, Mexico).
Stephen Rabinowitz 52 1994 President and Chief Executive Officer, General
Cable Corporation; prior to 1994, President,
AlliedSignal Braking Systems, AlliedSignal, Inc.;
prior to 1993, Vice President and Group Executive,
GE Electrical Distribution and Control, General
Electric Company.
Thomas C. Wajnert 52 1994 Chairman of the Board and Chief executive
Officer, AT&T Capital Corporation.
Charles O. Wood, III 57 1988 President, Wood Holdings, Inc., a private
investment firm. Chairman of the Board, Boston
Private Bancorp.
</TABLE>
Each nominee for director listed above has been employed in the capacity noted
for more than five years, except as indicated. There are no family
relationships among any of the above-named directors.
Board of Directors
The Company's Board of Directors held six meetings during the 1995 fiscal year.
During that time, each director attended at least seventy-five percent of
the aggregate of (i) the number of meetings of the Board and (ii) the number of
meetings held by all committees of the Board on which he served.
The Board of Directors has established Audit, Compensation and Nominating
Committees to devote attention to specific subjects and to assist the Board
in the discharge of its responsibilities. The functions of those committees,
their current members and the number of meetings held during the 1995 fiscal
year are described below.
The Audit Committee, currently consisting of Messrs. Kempton (Chairman),
Palmer, Rabinowitz, Shockey and Wood, who are all outside directors, met two
times during the 1995 fiscal year. Its functions include recommending the
selection of the independent auditors; conferring with the independent auditors
and reviewing the scope and fees of the prospective annual audit and the
results thereof; reviewing the Company's annual report to shareholders
and annual filings with the Securities and Exchange Commission;
reviewing the adequacy of the Company's internal audit function, as well as the
accounting and financial controls and procedures; and approving the nature and
scope of nonaudit services performed by the independent auditors.
The Compensation Committee, currently consisting of Messrs. Kempton, Mezera,
Wajnert and Wood (Chairman), who are all outside directors, principally
evaluates the performance of the Chief Executive Officer; reviews his
evaluation of the other officers' performance; recommends compensation
arrangements for all officers of the Company, including salaries, bonuses and
other supplemental compensation programs; administers the Company's incentive
option plan; and reviews all other officer-related benefit plans. The
Compensation Committee held four meetings during the 1995 fiscal year.
The Nominating Committee, currently consisting of Messrs. Kempton, Mezera
(Chairman) and Wood, who are all outside directors, held four meetings
during fiscal 1995. The Nominating Committee is responsible for (1)
identifying and recommending to the Board appropriate areas of expertise to
be represented on the Board; (2) seeking out qualified candidates to fill
Board positions; (3) reviewing and recommending the slate of directors to be
submitted for election by the shareholders at each annual meeting; (4)
recommending to the Board appropriate deadlines for receiving shareholder
nominations of directors and reviewing any such shareholder nominations to
determine whether they comply with substantive and procedural requirements;
and (5) evaluating the performance of current directors. Nominations, other
than those by or at the direction of the Board, may be made pursuant to written
notice received by the Secretary of the Company at the principal executive
offices of the Company no later than ninety days prior to the date of the
annual meeting. Such notice must be accompanied by written statements signed
by each person so nominated setting forth all information in respect of such
person required by Items 401, 403 and 404 of Regulation S-K promulgated
by the Securities and Exchange Commission and stating that such person consents
to such nomination and consents to serve as director of the Company if elected.
The Board of Directors has also established a standing Executive Committee.
Directors who are not employees of the Company receive compensation for their
services as directors. Each such director currently receives a $16,000
annual retainer ($10,000 prior to March, 1995) and each committee chairman a
$1,000 annual retainer for service as a committee chairman. In addition, each
such director receives $1,000 and $850, respectively, for each Board meeting or
committee meeting attended. (Prior to March 1995, fees for board and committee
meetings attended were $800.) Directors are also reimbursed for out-of-pocket
expenses incurred in connection with their attendance at meetings and for other
services rendered as a director. Directors who are employees of the Company
do not receive additional compensation for services as a director.
The JLG Industries, Inc. Directors Stock Option Plan provides for annual
grants to each non-employee director of a single option to purchase 6,000
shares of the Company's Capital Stock provided the Company earned a net profit,
before extraordinary items, for the prior year. To adjust for recent stock
splits, during 1995 the Board of Directors approved an increase in the number
of shares from 2,000 to 6,000. Had the adjustment been in proportion to the
stock splits, the number of shares would have been increased to 8,000.
All share and per share amounts included in this proxy have been restated to
reflect the September 7, 1995 and February 23, 1995 two-for-one stock splits.
The Company has a Directors' Deferred Compensation Plan which entitles each
eligible director to defer the receipt of fees payable for services as a
director. Any director who is not an employee of the Company is eligible to
participate in the plan. Mr. Mezera elected to participate in the plan
during fiscal 1995. Payments deferred under the plan accrue interest at the
prime rate in effect from time to time.
VOTING SECURITIES AND PRINCIPAL HOLDERS
The following table sets forth, as of October 4, 1995, the beneficial
ownership of the Company's Capital Stock by (i) each director or nominee for
director of the Company, (ii) each executive officer of the Company named in
the Summary Compensation Table set forth under the caption "Executive
Compensation", and (iii) all directors and executive officers of the Company
as a group. All ownership information is based upon filings made by such
persons with the Securities and Exchange Commission ("Commission") or upon
information provided to the Company.
Amount and Nature of Beneficial Ownership
Acquirable
Name of Person Currently Within 60 Percent of
or Group (1) Owned(2) Days Class (3)
Paul K. Shockey 498,848 8,000 3.5%
Charles O. Wood, III 133,420 (4) 16,000 1.0%
Charles H. Diller, Jr. 55,196 15,200
L. David Black 42,192 (5) 35,332
Raymond F. Treml 38,920 20,400
Rao G. Bollimpalli 17,342 12,000
Michael Swartz 9,238 16,800
George R. Kempton 6,000 12,000
Gerald Palmer 4,000 9,664
Stephen Rabinowitz 4,000 8,000
James A. Mezera 8,000
Thomas C. Wajnert
All directors and executive
officers as a
group (12 persons) 809,156 171,084 6.8%
(1) The address of each of the named persons is c/o JLG Industries, Inc., 1 JLG
Drive, McConnellsburg, PA 17233.
(2) Each person listed has advised the Company that, except as otherwise
indicated, such person has sole voting and sole investment power with respect
to the shares indicated.
(3) Percentages are not shown where less than 1.0%.
(4) Includes 13,420 shares owned by a family trust.
(5) Includes 1,200 shares owned by spouse.
During June 1995, Mr. Mezera filed with the Securities and Exchange Commission
a Form 4 disclosing a previously unreported share disposition.
The following table sets forth the only stockholders known to the Company,
as of October 3, 1995, to be the beneficial owners of more than five percent of
the outstanding shares of the Company's Capital Stock, based solely upon
information supplied by such shareholders in filings with the Commission on a
Schedule 13D or a Schedule 13G.
Amount and
Nature of Percent of
Name and Address Beneficial Ownership Class
FMR Corp. 888,400 (1) 6.3%
82 Devonshire Street
Boston, MA 02109
Dimensional Fund Advisors 490,000 (2) 5.5%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
(1) Based on Schedule G dated February 13, 1995 filed by FMR Corp., its
wholly-owned subsidiary Fidelity Management & Research Company is the
beneficial owner of 832,400 shares of the Company as a result of acting as
investment advisor to several registered investment companies. According to
FMR Corp.'s filing, no one person's interest in such capital stock of the
Company is more than five percent of the total outstanding shares.
(2) As reflected in a report on Schedule 13G dated February 9, 1995 filed by
Dimension Fund Advisors Inc., a registered investment advisor, which shares
are held in portfolios of DFA Investment Dimensions Group Inc. and the DFA
Investment Trust Company, registered open-end investment companies, or the
DFA Group Trust and the DFA Participating Group Trust, investment vehicles for
qualified employee benefit plans, all of which Dimension Fund Advisors Inc.
serves as investment manager.
EXECUTIVE COMPENSATION
Compensation Committee Report on Executive Compensation
Executive Compensation Policies
The Company's executive compensation programs are designed to retain or attract
qualified executives to manage implementation of the Company's business
plans and to provide appropriate incentives, based principally on objective
criteria, that link compensation to Company performance. The Compensation
Committee, which is composed entirely of non-employee directors, reviews
executive compensation levels annually and recommends for Board consideration
an annual compensation package for each executive officer comprised of base
salary and target cash bonuses pursuant to an incentive bonus plan. The
target cash bonuses are awarded on the basis of individual performance
objectives and the Company's achieving targeted levels of return on average
shareholders' equity and other performance objectives. The Committee also
determines annually for each executive officer appropriate levels of stock
options or other stock-based awards under the Company's Stock Incentive Plan.
In granting stock options, the Committee considers the cash value of such
awards based on the Black-Scholes valuation method. The Committee believes the
stock-based awards provide incentives for executive management to promote
long-term shareholder value.
Total compensation available in the combined package for each officer will
generally be set based on the Company's financial condition and performance
objectives and comparisons to the preceding year's package and median
compensation levels for comparable positions reflected in broad-based
industry surveys provided to the Committee by independent compensation
consultants. The Committee believes that the market for skilled senior
management is not limited to capital equipment manufacturers and that a broad
industry comparison offers a better basis for establishing annual compensation
packages than comparison to executive compensation paid by firms included in
the Peer Industry Group identified in the Performance Graph included in this
Proxy Statement.
Compensation for Fiscal Year 1995
Compensation paid to the Company's executive officers in fiscal year 1995
consisted of a base salary and a year-end cash bonus. In addition, for fiscal
1995 the Committee also awarded stock options and restricted share awards under
the Company's Stock Incentive Plan.
For fiscal 1995 the Company reported record sales and profits and total
return to shareholders from shareholder price appreciation was 105%. Based
on this performance, the Committee recommended and the Board approved salary
level increases for executive officers as well as cash bonuses under
the Company's incentive bonus plan. For all executive officers except Mr.
Black, the Committee considered and approved, with certain adjustments,
salary increases recommended by Mr. Black based on his assessment of
those officers' successes in meeting specific performance objectives and
their relative contributions to the Company'saccomplishments. With respect to
the cash bonuses, the Committee considered and approved bonuses determined
pursuant to the incentive bonus plan. With the bonuses, total cash
compensation for executive officers as a group was between the 50th and
75th percentile reflected in the survey data provided to the Committee by the
consulting firm of Towers Perrin. Without the bonuses, cash compensation for
executive officers as a group would have been slightly below the median.
The Committee also considered and approved performance criteria and target
bonuses for the fiscal 1996 incentive bonus plan. Bonus awards for fiscal
1996 will be determined on the basis of many of the same factors as the fiscal
1995 plan; however, in assessing performance of the Company, the Committee
will consider other factors in addition to return on average shareholders'
equity. The fiscal 1996 plan also provides the Committee greater latitude to
vary awards based on individual performance and on unplanned or unforeseeable
extraordinary events that may affect the Company's performance.
Finally, the Committee considered and approved the grant of stock options and
restricted shares for the executive officers as recommended by Mr. Black on
the basis of his evaluation of their performance and ability to contribute
to the Company in the future. In granting the restricted share awards, the
Committee acknowledged that the Company's return on average shareholders'
equity for fiscal 1995 substantially exceeded the top target contemplated for
that measure by the incentive bonus plan.
Chief Executive Officer Compensation
The Committee believes Mr. Black's leadership has been instrumental in
strengthening the Company and achieving recent record financial results. In a
rapidly growing and highly competitive market, Mr. Black has led the Company's
dedication to satisfying customer needs while simultaneously streamlining
manufacturing operations to improve efficiency. For the longer term, he has
developed strategic plans to continue the Company's rapid growth.
In fiscal 1995, the Company exceeded virtually every objective of its annual
plan. In addition to setting new sales and earnings records and doubling net
income compared to the prior year, total return on the Company's stock
grew 105%, while the total return of its Peer Industry Group increased 23% and
the NASDAQ Market Index increased 22%.
In view of these results, the Committee, in fiscal 1995, recommended and the
Board approved an 17% increase in Mr. Black's salary for fiscal 1996 from
$253,000 to $300,000. The Committee also recommended and the Board approved
payment to Mr. Black of a $177,106 cash bonus for fiscal 1995 which was the
maximum target under the incentive bonus plan. In awarding the bonus, the
Committee considered Mr. Black's performance in relation to the criteria under
the incentive bonus plan. In setting the bonus target, the Committee
considered survey data provided by the Committee's compensation consultant.
With the bonus, Mr. Black's total cash compensation was somewhat above the
survey median. Without the bonus, his cash compensation would have been
substantially below the median.
The Committee also awarded Mr. Black options to acquire 23,000 shares of
Capital Stock, with an exercise price equal to the market price on the date the
options were granted, and a bonus of 5,000 restricted shares. The options
become exercisable and the restricted shares vest ratably over the next three
years subject to Mr. Black's continuing employment with the Company. With the
options and restricted shares, Mr. Black's total direct compensation equaled
approximately the 75th percentile of the survey data provided by Towers Perrin.
In determining the number of options and restricted shares awarded Mr. Black,
the Committee based its decision on Mr. Black's performance.
Discussion of Corporate Tax Deduction for Compensation in Excess of $1 Million
a Year
Internal Revenue Code Section 162(m), enacted in 1993, precludes a public
corporation from taking a deduction in 1994 and in subsequent years for
compensation in excess of $1 million paid to its chief executive officer or
any of its four other highest-paid executive officers. Certain performance-
ased compensation, however, is specifically exempt from the deduction limit.
As a general matter, the Company does not anticipate that the compensation
(including bonuses) paid to any of these executive officers in any year in the
foreseeable future will approach $1 million. However, there is the possibility
that, if the Company's stock price appreciates substantially, a stock option
exercise by an executive officer could cause the threshold to be exceeded.
Accordingly, in 1994 the Board recommended and the shareholders approved, the
amendments to the Company's Stock Incentive Plan designed to conform to the
requirements of Section 162(m) so that compensation expenses in connection
with the exercise of stock options and the vesting of certain performance-based
restricted share awards will be excluded from the deduction limit.
The Committee will continue to monitor this matter and will take further
appropriate action if it is warranted in the future.
This report is submitted by the Compensation Committee of the Board of
Directors.
George R. Kempton
James A. Mezera
Thomas C. Wajnert
Charles O. Wood, III
September 6, 1995
The following tables and narrative set forth compensation information for the
Company's Chief Executive Officer and its four most highly compensated
executive officers (the "named executive officers") as of the end of the 1995
fiscal year.
<TABLE>
Summary Compensation Table
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
Name and Other Restricted All
Principal Annual Stock Other
Position Year Salary Bonus(1) Compensation(2) Awards(3) Options Compensation(4)
<S> <C> <C> <C> <C> <C> <C>
L. David Black 1995 $253,008 $177,106 $94,438 31,800 $8,312
Chairman of the Board, 1994 250,016 120,750 46,000 13,806
President and Chief 1993 206,400 80,000 50,000 11,948
Executive Officer
Charles H. Diller, Jr. 1995 165,000 99,000 36,104 9,600 12,249
Executive Vice 1994 150,000 75,000 21,600 12,557
President and Chief 1993 135,508 55,000 40,000 8,245
Financial Officer
Michael Swartz 1995 133,608 66,804 24,369 4,600 16,233
Senior Vice 1994 126,000 50,000 14,400 10,556
President-Marketing 1993 120,508 30,000 20,000 9,570
Raymond F. Treml 1995 122,016 61,008 22,276 4,200 12,358
Senior Vice 1994 115,008 42,996 13,200 13,292
President- 1993 110,500 38,000 20,000 9,388
Manufacturing
Rao Bollimpalli 1995 110,016 55,008 20,070 3,800 13,888
Senior Vice 1994 105,000 32,732 6,000 7,636
President-Engineering 1993 99,500 30,000 10,000 8,361
</TABLE>
(1) Reflects bonuses earned during the fiscal year, but paid during the
following fiscal year.
(2) Excludes the value of perquisites and other personal benefits. The
incremental cost to the Company of providing such perquisites and other
personal benefits did not exceed the lesser of $50,000 or 10% of annual salary
and bonus for any of the named executive officers.
(3) The restricted shares were awarded September 6, 1995 with respect to
the year ended July 31, 1995. The number and value of the aggregate holdings
at that date were 14,212 and $531,174, respectively. Dividends are payable
on restricted awards and vesting is in equal annual installments over three
years.
(4) For fiscal 1995, includes payments pursuant to the Company's Supplemental
Medical Care Reimbursement Plan for its executive officers to reimburse
medical expenses incurred by the named officers or their dependents and
not paid by other employee benefit plans (Mr. Black $1,295; Mr. Diller $2,646;
Mr. Swartz $4,197; Mr. Treml $1,361; and Mr. Bollimpalli $1,924), and
contributions to the Company's two discretionary, defined contribution
retirement plans (Mr. Black $7,017; Mr. Diller $6,987; Mr. Swartz $8,628;
Mr. Treml $6,929; and Mr. Bollimpalli $8,552).
<TABLE>
Stock Options/SAR Grants in Last Fiscal Year
<CAPTION>
Potential Realizable
Value at Assumed Annual
Rates of Stock
Price Appreciation
Individual Grants for Option Term(3)
% of Total
Options
Options/ Granted to
SAR's Employess Exercise or
Granted in Fiscal Base Price Expiration
Name (1) Year Per Share Date(2) 5% 10%
<S> <C> <C> <C> <S> <C> <C>
L. David Black 31,800 34% $16.93 July 25, 2005 $400,321 $956,435
Charles H. Diller, Jr. 9,600 10 16.93 July 25, 2005 120,852 288,735
Michael Swartz 4,600 5 16.93 July 25, 2005 57,908 138,352
Raymond F. Treml 4,200 5 16.93 July 25, 2005 52,873 126,322
Rao Bollimpalli 3,800 4 16.93 July 25, 2005 47,837 114,291
</TABLE>
(1) Consists solely of options to purchase shares of Capital Stock.
(2) Options become exercisable in equal amounts over a three year period
beginning July 26, 1996. To the extent not already exercisable, the options
generally become exercisable upon a change in control. A change in
control means either (i) any person or group becomes the beneficial owner of
25% or more of the voting power of the Company's stock; or (ii) the election
within a twelve-month period of three or more directors whose election is not
approved by the majority of the Board of Directors; or (iii) the incumbent
directors cease to be a majority of the Board of Directors.
(3) The potential realizable value illustrates value that might be realized
upon exercise of the options immediately prior to the expiration of their term,
assuming the specified compounded rates of appreciation in the market price
of the Capital Stock over the terms of the options. The potential realizable
value to all shareholders using the specified 5% and 10% rates of appreciation
would be $179,702,473 and $429,339,781, respectively. The Company's use of
these hypothetical appreciation rates specified by the Securities and Exchange
Commission should not be construed as an endorsement of the accuracy of this
method of valuing options. The value realized by the holders of the options
will depend upon the actual performance of the Capital Stock over the term
of the options.
<TABLE>
Aggregate Option/SAR Exercises in Last Fiscal Year and Fiscal Year End Option/SAR Values
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money
Options Options
Shares Acquired At Fiscal Year End(1) At Fiscal Year End(2)
Name on Exercise Value Realized Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
L.David Black 30,000 $367,450 35,332 122,468 $437,818 $1,208,514
Charles H. Diller, Jr. 15,000 246,275 15,200 48,000 185,068 499,560
Michael Swartz 11,600 143,086 16,800 14,200 221,712 94,898
Raymond F. Treml 4,000 38,120 20,400 25,000 281,226 263,970
Rao Bollimpalli 6,000 11,900 155,260 256,042
</TABLE>
(1) The Company does not have any outstanding stock appreciation rights.
(2) Value is calculated based on the difference between the option
exercise price and the closing market price of the Company's Capital
Stock on July 31, 1995, multiplied by the number of shares underlying
the option.
Compensation Pursuant to Plans
The Company maintains a supplemental executive retirement plan, which is a
nonqualified defined benefit plan for all officers that provides for payments
during the 10-year period following retirement or in other specified
circumstances, including a change in control of the Company or a change in the
officer's responsibilities following a change in control, at an annual rate of
one-third of the average of their annual compensation for the five fiscal years
with the Company in which such compensation was the highest. The plan provides
for 20% vesting per year after three years of service, with full vesting after
seven years of service, and also provides for the reimbursement of certain
medical expenses incurred by the officers and their dependents during the
period in which benefits are paid under the plan. Based on their compensation
through the end of the Company's 1995 fiscal year, the named executive officers
would be entitled to annual payments under the plan as follows: Mr. Black,
$42,366; Mr. Diller, $67,267; Mr. Swartz, $43,386; Mr. Treml, $49,047 and Mr.
Bollimpalli, $43,394.
In early fiscal 1996, the Company intends to replace the existing supplemental
executive retirement plan with a new non-qualified defined benefit plan that
provides for payments, following retirement or in other specified
circumstances, equal to the average of the officer's compensation, being base
salary plus cash bonus, for the two calendar years in which it is the highest,
multiplied by 65% for Mr. Black, 60% for Mr. Diller and 55% for Messrs. Swartz,
Treml and Bollimpalli; offset, however, by the actuarial equivalent of benefits
provided to the officer in conjunction with the Company's contribution to
other employersponsored retirement plans, the actuarial equivalent of
retirement benefits provided by previous employers of the officer; and 50%
of the officer's social security benefit. The retirement benefit is payable
in the form of a ten year certain life annuity, with options for a joint
and survivor annuity and a lump sum payout. The officer may elect to receive a
reduced retirement benefit in the case of early retirement. The plan provides
for 25% vesting per year after two years of service, with full vesting
after five years of service. The plan also provides a separate retiree medical
benefit to the officers, together with their spouse and eligible dependents.
The Company also intends to introduce an executive severance plan which will
provide a severance benefit of three times base salary plus cash bonus for
Mr. Black and two times base salary plus cash bonus for Messrs. Diller, Swartz,
Treml and Bollimpalli, with base salary and cash bonus being the amounts paid
the officer for the final twelve calendar months of employment. The severance
benefit is payable in the form of a lump sum upon involuntary termination
of employment by the Company, unless the termination is for one of the
specified reasons which includes disloyalty and conviction of a felony.
The severance benefit is also payable upon certain terminations in connection
with a change of control, No severance benefit is payable if the officer is
entitled to a retirement benefit under the supplemental executive retirement
plan, except with a change of control.
Performance Graph
The following graph compares the cumulative return on the Company's Capital
Stock over the past five years with the cumulative total return on shares
of companies comprising the NASDAQ Market index and a peer industry group
consisting of companies manufacturing machinery for use in the construction,
material handling, farm and mining industries. Both indices are prepared
by Media General Financial Services and contain only those companies that were
public as of July 31, 1995 and have been public for the timeframe of
the performance graph. Cumulative total return is measured assuming an
initial investment of $100 on July 31, 1990 and the reinvestment of all
dividends paid.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG JLG INDUSTRIES, INC., THE NASDAQ MARKET INDEX
AND A PEER INDUSTRY GROUP
Company 1990 1991 1992 1993 1994 1995
JLG Industries, Inc. 100 48.07 38.78 61.45 143.64 294.13
Industry Index 100 83.04 74.60 112.05 141.62 172.62
Broad Market 100 100.40 102.87 127.77 139.43 170.86
CERTAIN TRANSACTIONS
The Company has a stock redemption agreement with Mr. Shockey under which
the Company is obligated to purchase shares of the Company's Capital Stock
from his estate, and the estate is obligated to sell such shares to the
Company. The purchase price of the shares will be determined, in accordance
with the agreement, by national market quotations or prices over the twenty
trading days preceding death, or by independent appraisal if such market
quotations or prices are not available. The number of shares to be
purchased by the Company from his estate will be the lesser of (A) 35% of the
shares owned by Mr. Shockey at his death, or (B) that number of shares as has a
purchase price equal to the greater of (i) $500,000 or (ii) the net proceeds
(after reduction for any outstanding policy loans) collected by the Company
from any policy or policies of life insurance maintained by the Company on the
life of Mr. Shockey. In order to fund its obligation under the stock
redemption agreement, the Company currently maintains life insurance policies
on Mr. Shockey's life in the amount of $851,917. For fiscal 1995, the premium
cost was $20,594, net of the increase in cash surrender value of the policies.
Proceeds under the policies are payable to the Company. Dividends on the
policies may be used by the Company either to purchase additional insurance or
to reduce premium expense. The Company is not obligated to maintain these
life insurance policies.
SELECTION OF INDEPENDENT AUDITORS
The accounting firm of Ernst & Young LLP served as the Company's independent
auditors throughout fiscal year 1995 and the Board of Directors, on the
recommendation of the Audit Committee, has selected the firm as the
Company's independent auditors for fiscal 1996. The Board of Directors
recommends ratification of the selection of Ernst & Young LLP as the Company's
independent auditors for the fiscal year 1996. Representatives of the firm of
Ernst & Young LLP are expected to be present at the Annual Meeting, with the
opportunity to make a statement if they desire to do so, and to respond to
appropriate questions. If the selection is not ratified, the Board of
Directors will reconsider its action.
PROPOSAL TO AMEND ARTICLES OF INCORPORATION
TO INCREASE AUTHORIZED CAPITAL STOCK
Background
On February 23, 1995, the Board of Directors declared a two-for-one stock split
on the Company's capital stock par value $.20 per share (the "Capital Stock")
which was effected in the form of a 100 percent stock dividend. As a result,
the number of outstanding shares of Capital Stock increased to in excess of
seven million. Then, on September 7, 1995, the Board of Directors declared
another two-for-one stock split, again effected in the form of a 100 percent
stock dividend. To provide sufficient authorized shares to effectuate the
stock split and corresponding adjustments in the Company's Compensation Plans
(defined below), the Board of Directors unanimously approved a resolution to
amendSection 5 of the Company's Articles of Incorporation (the "Articles") to
increase the number of authorized shares of Capital Stock from ten
million shares to approximately seventeen million shares. This amendment,
referred to herein as the "Prior Amendment", was adopted in accordance with
Section 1914(c) of the Pennsylvania Business Corporation Law ("BCL") which
permits the Board of Directors, without shareholder approval, to amend the
Articles to authorize additional shares to the extent necessary to accomplish a
stock split by means of a stock dividend.
After giving effect to the second stock split, the Company has fourteen million
three hundred four thousand and eighteen (14,304,018) shares of Capital Stock
issued and outstanding. In addition, two million six hundred eighty-four
thousand nine hundred and thirty-four (2,684,934) shares of Capital Stock
are reserved for issuance collectively under the Company's Stock
Incentive Plan and Directors' Stock Option Plan (the "Compensation Plans")
with respect to outstanding options or options or other awards that may be
granted in the future. Thus, the Company currently has no authorized but
unissued shares of Capital Stock that are not reserved for issuance.
Discussion of Proposed Amendment of Articles
Accordingly, on September 7, 1995, the Board of Directors, by unanimous vote,
also adopted resolutions approving and recommending that the shareholders
adopt an additional amendment to the Articles to increase the Company's
authorized Capital Stock to thirty-five million (35,000,000) shares.
Reasons for Proposed Amendment
The proposed increase in authorized shares would partially restore the capacity
of the Board of Directors that existed prior to the recent stock splits to
authorize the issuance of additional shares without shareholder approval.
The Board of Directors believes that having capacity to issue shares will
provide the Company greater flexibility for future growth and provide the
opportunity for enhanced marketability of the Company's shares. The
additional authorized shares would be available for equity-based acquisitions,
public or private offerings of shares or securities convertible into shares,
employee benefit plans, and other proper corporate purposes that might be
proposed. In light of the present limitations of the BCL, the additional
authorized shares also would permit the Board of Directors to declare future
limited stock splits or stock dividends without unduly diminishing the
Company's capacity to issue shares for other proper purposes. Legislation
has been introduced in the Pennsylvania Legislature to amend the BCL in a
manner that would permit the Board of Directors, in connection with a
stock split or stock dividend and without shareholder approval, to
amend the Articles and increase the Company's authorized shares in proportion
to the stock split or stock dividend. There can be no assurance that this
proposed legislation will be enacted.
Although the Company does not have any present plans to issue additional
shares, apart from shares to be issued from time to time pursuant to the
Compensation Plans, the current lack of authorized but unissued
shares will impede the Company's ability to evaluate or seek to consummate
business combinations or other transactions which might enhance shareholder
value. If additional shares are available, transactions dependent upon the
issuance of shares would be less likely to be undermined by delays and
uncertainties occasioned by the need to obtain shareholder authorization prior
to the consummation of such transactions. The capacity to issue shares in
these and other appropriate circumstances also would permit the Company in
the future to avoid the expenses associated with holding special shareholders'
meetings.
Effects of Proposed Amendment
If the proposed amendment is adopted, the newly authorized shares would be
unreserved and available for issuance, and no further shareholder
authorization would be required before the issuance of the shares by
the Company unless such issuances relate to a merger, consolidation or other
transaction which under the BCL or otherwise requires shareholder approval.
All ofthe additional shares resulting from the increase in the Company's
authorized Capital Stock would be of the same class, with the same dividend,
voting and liquidation rights, as the shares of Capital Stock presently
outstanding. The Capital Stock is the only class of shares authorized by the
Articles; no class of preferred stock is presently authorized. Shareholders
have no preemptive rights to acquire shares issued by the Company under the
Articles, and shareholders would not acquire any such rights with respect to
the additional shares under the proposed amendment to the Articles.
Under some circumstances, the issuance of additional shares of Capital Stock
could dilute the voting rights, equity and earnings per share of existing
shareholders.
The additional authorized but unissued shares could be used by the Board of
Directors to make a change in control of the Company more difficult. Under
certain circumstances, if determined by the Board of Directors to be in the
best interests of the Company, these shares could be used to create voting
impediments or frustrate persons seeking to effect a takeover or otherwise gain
control of the Company.
The Company already is subject to provisions of the BCL that impose certain
restrictions and procedures that deter, or affect the ability of a person or
entity to initiate or complete, an unsolicited acquisition of control of
the Company. Among other things, the BCL (i) negates the voting power of
"control shares" (i.e., with certain exceptions, shares acquired by a person
or group with the intent of, or within 180 days of, acquiring voting
power for the first time over at least 20 percent of the Company's voting
shares) until voting power is restored at a shareholders' meeting by a
favorable vote of a majority of all shares and a majority of all
"disinterested shares" (i.e., generally shares not owned by the acquiring
person or group or the Company's executive officers), (ii) requires persons
who publicly announce an intention to acquire control of the Company to
disgorge to the Company any profits obtained from the disposition, within 18
months following the announcement, of Company shares acquired within
two years prior to the announcement or 18 months
following the announcement, (iii) specifies certain severance benefits payable
to eligible employees that may be terminated within 24 months following a
change in control, and (iv) requires generally any person who acquires at
least 20 percent of the Company's voting shares (a "Controlling Person") to
pay all shareholders, upon demand, fair value for their shares which value
shall not be less than the highest price per share paid by the Controlling
Person within the 90-day period ending on the date the Controlling Person first
becomes a Controlling Person.
In addition, the Company's bylaws establish procedures that regulate the timing
and manner in which shareholders may propose director nominees and the
Articles do not provide for cumulative voting. Without cumulative voting,
in order to be ensured of representation on the Board, a shareholder must
control the votes of a majority of the shares present and voting at a
shareholders' meeting at which a quorum is present. The lack of cumulative
voting requires an entity seeking a takeover to acquire a substantially greater
number of shares to ensure representation on the Board than would be necessary
were cumulative voting available.
The proposed increase in authorized shares is not the result of the Board's
knowledge of any specific effort to accumulate the Company's securities or to
obtain control of the Company by means of a merger, tender offer, proxy
solicitation in opposition to management or otherwise. Although there may be
future circumstances in which the Board may determine it to be in the best
interests of the Company to oppose efforts by another party to acquire a
controlling interest in the Company, the Company has no present intention of
issuing shares for any such purpose.
Resolutions to be Considered and Text of Proposed Amendment
The formal resolutions to be considered by the shareholders for approval are as
follows:
RESOLVED, that the Prior Amendment is hereby ratified and approved; and
FURTHER RESOLVED, that Article 5 of the Company's Articles of Incorporation is
hereby amended and restated in its entirety as follows:
5. The aggregate number of shares which the corporation is authorized to
issue is Thirty Five Million (35,000,000) shares $.20 par value capital stock
with a total par value of $7,000,000.
FURTHER RESOLVED, that the appropriate officers of the Company shall be and
each is authorized and directed to take all such further actions as shall be
necessary and appropriate to effectuate the foregoing resolutions, including
but not limited to, making such filings on behalf of the Company as shall
be required to make the proposed amendment to the Company's Articles of
Incorporation effective with the Commonwealth of Pennsylvania.
Vote Required
The affirmative vote of the holders of a majority of the shares cast by all
shareholders entitled to vote at the Annual Meeting is required to approve the
proposed resolutions, including the amendment to the Company's Articles.
For the purpose of counting votes on this proposal, abstentions effectively
will constitute a "no" vote. Shares held in a "street name" by a broker or
nominee trust that are not voted due to the absence of discretionary authority
of the holder to vote such shares ("broker nonvotes") will not be counted as
shares entitled to vote.
Recommendation of the Board of Directors
The Board of Directors believes that the proposed amendment to the Articles is
in the best interests of the Company. Accordingly, the Board of Directors
recommends a vote FOR the proposal.
VOTING INSTRUCTIONS
The matters set forth in the Notice of Annual Meeting will be voted upon in the
order in which they are listed in the Notice. The proxy form accompanying this
Proxy Statement provides boxes by means of which shareholders executing the
proxy forms may vote for or withhold a vote on the election of all or any of
Board of Director's nominees for election as directors. Proxies will be voted
in accordance with such direction or, if no such direction is indicated, will
be voted in favor of the election of each of the nominees. Each of the
nominees has consented to serve as director and the Board of Directors has no
reason to believe that any of the nominees will not be available to serve
if elected. Should any of the nominees cease to be available for election
before the Annual meeting, the proxy will, unless authority to vote has been
withheld by the person giving the proxy, be voted for a substitute nominee
designated by the Board of Directors. Duly executed proxies will be voted as
directed on the other questions specified on the proxy and, in the absence of
such direction, will be voted for each proposal.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1996 Annual Meeting must
be received in writing by the Company before June 16, 1996, in order to be
considered for inclusion in the Company's proxy materials relating to that
meeting.
OTHER BUSINESS
The Board of Directors of the Company knows of no other matters that may come
before the Annual Meeting. As to any other business that may properly come
before the meeting, proxies will be voted in accordance with the best judgment
of the persons voting such proxies.
BY ORDER OF THE BOARD OF DIRECTORS
Dated October 11, 1995 Paul K. Shockey, Secretary
JLG INDUSTRIES, INC.
1 JLG DRIVE
MCCONNELLSBURG, PA 17233-9533
This proxy is solicited on behalf of the Board of Directors.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
of Shareholders and Proxy Statement, and does hereby appoint L. David Black,
Charles H. Diller, Jr. and Paul K. Shockey, and each of them, or such person
or persons as they or any of them may substitute and appoint as proxy or
proxies of the undersigned to represent the undersigned and to vote all
shares of JLG Industries, Inc. Capital Stock which the undersigned would be
entitled to vote if personally present at the Annual meeting of Shareholders
of JLG Industries, Inc. to be held on Monday, November 20, 1995 at 4:30
p.m., and at all adjournments of such meeting.
THE PROXY WILL BE VOTED AS DIRECTED. IN THE ABSENCE OF DIRECTION, PROXIES WILL
BE VOTED FOR ALL THE PROPOSALS.
The Board of Directors unanimously recommends a vote FOR its nominees and
proposals 2, 3 and 4.
1. ELECTION OF DIRECTORS
FOR all nominees listed (except as marked to the contrary)
WITHHOLD AUTHORITY to vote for nominees listed
Nominees: L.D. Black; C.H. Diller,Jr.; G.R. Kempton; J.A. Mezera; G. Palmer;
S. Rabinowitz; T.C. Wajnert; and C.O. Wood, III.
Instructions: To withhold authority to vote for any nominee, write that
nominee's name on the space provided below.
2. Ratify the appointment of Ernst & Young LLP as independent auditors for the
ensuing year.
FOR AGAINST ABSTAIN
3. Ratification and approval of amendments to the Articles of Incorporation to
increase authorized capital stock par value $.20 to 35,000,000 shares.
FOR AGAINST ABSTAIN
4. In their discretion, upon any other business that may properly come before
the meeting or any adjournment thereof.
Please sign exactly as your name appears at hereon. When shares are
held by joint tenants, all should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If as a
corporation, please sign in corporate name by president or other authorized
officer. If as a partnership, please sign in partnership name by authorized
person.
Dated: , 1995
PLEASE VOTE, DATE, SIGN AND RETURN THE PROXY
Signature CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
Annual Meeting
of
JLG Industries, Inc. Shareholders
Monday, November 20, 1995
4:30 p.m.
JLG Industries, Inc.
JLG Drive
McConnellsburg, PA 17233-9533
