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
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Filed by the Registrant / x_/
Check the appropriate box:
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/ ___/ Preliminary Proxy Statement /___/ Confidential, for Use of
the Commission Only (as
____ permitted by Rule 14a-6(e) (2))
/_ x_/ Definitive Proxy Statement
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/___/ Definitive Additional Materials
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/___/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
DRIVER-HARRIS COMPANY
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box)
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/_x_/$125 per Exchange Act Rules 0-11(c) (1) (ii),14a-6(i) (1), or 14-a6(i) (2)
or Item 22(a) (2) of Schedule 14A.
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/__/$500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i) (3).
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/__/ Fee computed on table below per Exchange Act Rules 14a-6(1) (4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/___/ Fee paid previously with preliminary materials.
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/___/ 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
DRIVER-HARRIS COMPANY
308 MIDDLESEX STREET
HARRISON, NEW JERSEY 07029
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 29, 1996
TO THE STOCKHOLDERS:
The annual meeting of the stockholders of Driver-Harris Company will be
held at the office of the Company, 308 Middlesex Street, Harrison, New Jersey,
on Wednesday, May 29, 1996 at 11:00 A.M., for the purpose of:
1. Electing four directors
2. Transacting any and all other business that may properly come
before the meeting.
The transfer books will not be closed for the Annual Meeting. Only
stockholders of record at the close of business on May 1, 1996 will be
entitled to vote at the meeting.
By Order of the Board of Directors:
LAVINIA Z. EMERY
Secretary
Harrison, New Jersey
May 3, 1996
It is important that your stock be represented at this meeting. If you are
not able to be present at the meeting, please sign and date the enclosed
proxy and mail it in the enclosed envelope. Because of the work necessary to
prepare for the meeting, the immediate return of your proxy will be
appreciated.
<PAGE>
DRIVER-HARRIS COMPANY
(Incorporated in New Jersey)
P R O X Y S T A T E M E N T
Annual Meeting of Stockholders to be held May 29, 1996
SOLICITATION AND REVOCABILITY OF PROXY
The accompanying proxy is solicited by order of the Board of Directors
of Driver-Harris Company, 308 Middlesex Street, Harrison, New Jersey 07029,
for use at the annual meeting of stockholders of the Company to be held on
May 29, 1996 and any adjournment thereof. This Proxy Statement and the
enclosed form of proxy are first being mailed to stockholders of this
Company on or about May 3, 1996.
Execution of the Proxy will not in any way affect the stockholder's
right to attend the meeting and vote in person. In addition, a proxy may be
revoked by a stockholder at any time prior to being voted by giving written
notice of such revocation to the Secretary of the meeting, or by filing with
the Secretary another proxy bearing a later date.
The Company will bear the cost of solicitation of proxies and will
reimburse persons holding stock in their names or those of their nominees for
their expenses in sending soliciting material to their principals. In
addition to the solicitation of proxies by use of the mails, proxies may also
be solicited by regularly engaged employees of the Company by telephone,
telegraph, cable and personal interview. It is not expected that any
solicitation will be made by specially engaged employees of the Company or
other paid solicitors.
VOTING SECURITIES
Only stockholders of record at the close of business on May 1, 1996 will be
entitled to vote at the annual meeting. The Company has only one class of
voting securities currently outstanding, its Common Stock, of which 1,297,389
shares were outstanding on May 1, 1996 the record date. Each stockholder is
entitled to one vote for each share of stock held by him. The presence, in
person or by proxy, of the holders of a majority of the outstanding shares is
required for a quorum.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) Ownership of shares of the Company's Common Stock by certain
beneficial owners as of March 4, 1996
<TABLE>
<S> <C> <C>
Amount and
Name and Address of Nature of Percent
Beneficial Owner Beneficial of
Ownership Class
Estate of Frank L.Driver Jr. 64,172* 5.0
2 Delafield Street
Westhampton Beach, NY
Estate of Frank L.Driver III 96,662** 7.3
98 Old Chester Road
Essex Fells, NJ
Gerhard Haase 120,400 9.3
2306 West Roscoe
Chicago, IL
Mustapha Omar Dimachkie 105,500 8.2
Rue Mme. Curie
Dimachkie Bldg.
Beirut, Lebanon
Frank L. Driver IV 81,822*** 6.1
241 Grove Street
Jersey City, NJ
</TABLE>
* All shares held of record and beneficially. As executor of the Estate of
Frank L.Driver Jr., David A. Driver, a Director of Driver-Harris Company,
holds voting rights to such shares.
** All shares held of record. Includes 30,000 shares under options
pursuant to the Driver-Harris Employee Incentive Stock Option Plan, granted
in 1992 and 1993, which are fully exercisable. However, does not include
24,154 shares held by Corinne Driver, his spouse and the mother of Frank L.
Driver IV, who disclaims any beneficial interest in these shares. As co-
executor of the Estate of Frank L. Driver III, Frank L. Driver IV, Director
and President, holds voting rights to such shares.
*** Including 45,000 shares under options pursuant to the Driver-Harris
Employee Incentive Stock Option Plan, granted in 1990, 1991 and 1992, which
are fully exercisable.
(b) Security ownership of management as of March 4, 1996:
<TABLE>
<S> <C> <C>
Amount and Nature of Percent
Title of Class Beneficial Ownership of Class
- -------------- --------------------------- ----------
Driver-Harris Company
Common Stock 290,976* 21.09
</TABLE>
* Includes 82,500 shares under options pursuant to the Driver-Harris Employee
Incentive Stock Option Plan.
(c) Management is not aware of any arrangement which may result in a
change in control of the Company.
ELECTIONS OF DIRECTORS
Four Directors are to be elected at the meeting to hold office until the
next annual meeting of the stockholders and until their respective successors
shall be elected and qualified.
All duly executed proxies will be voted for the election of the four
nominees named below unless, as is not anticipated, any one of the nominees
is unable or declines to serve, in which case such proxies will be voted for
the balance of the nominees and for substitute nominees, unless the Board
deems it advisable to amend the By-Laws so as to decrease the number of
directors to be elected. All nominees are presently directors of the Company.
The following table summarizes the principal occupations and business
experience during the past five years, as well as certain other information
as of March 4, 1996 for each nominee:
<TABLE>
<S> <S> <S> <S> <S> <S>
Company
Principal Occupation Common % of
During Last Five Years Stock Outstanding
and other Director Beneficially Common
Name Age Directorships Since Owned(1) Stock
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Ralph T.
Bartlett 71 Certified Public 1985 100 *
Accountant. Until 1984
a partner of Deloitte
Haskins & Sells (now
Deloitte & Touche), NY
H. L.
Biggerstaff 69 Retired. Until 1988, 1980 2,000 *
President Arwood Die
Casting Division
of Arwood Corp.
David A.
Driver 57 President,Atlantic 1977 38,720 3.0
Alloys Inc., a
manufacturer of bi-
metallic components
for temperature
control devices.
Frank L.
Driver IV 35 President and Chief 1993 81,822** 6.1
Executive Officer
</TABLE>
* Denotes less than 1% of outstanding.
** Includes 45,000 shares under options pursuant to the Driver-Harris
Employee Incentive Stock Option Plan.
(1) On March 4, 1996 all Directors of the Corporation as a group (4) owned
beneficially 283,476 shares or 20.54% of the outstanding Common Stock.
This amount includes 30,000 shares granted to Frank L. Driver III and
45,000 shares granted to Frank L. Driver IV pursuant to the Driver-
Harris Employee Incentive Stock Option Plan. Also, Frank L. Driver IV
is co-executor of the estate of his father, Frank L. Driver III, which
owns 96,662 shares including options, and is now exercisable by the
estate, or 7.3% of the outstanding common stock. In addition, David
A. Driver is executor of the estate of his father, Frank L. Driver
Jr., which owns 64,172 shares or 5% of the outstanding common stock.
The Company has an Audit Committee and a Compensation Committee, it
does not have a Nominating Committee. The Audit Committee, which held two
meetings during 1995, is responsible for the Company's audit and financial
controls. Messrs. Ralph T. Bartlett and H. L. Biggerstaff are members of the
Audit Committee.
The Compensation Committee met in March of 1995. Messrs. David A. Driver
and H. L. Biggerstaff are members of the committee.
The Board of Directors held five meetings during calendar 1995.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
<TABLE>
SUMMARY COMPENSATION TABLE
<S> <S> <C> <C> <C>
Long-Term
Annual Compensation
Compensation Awards
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Securities
Name and Principal Underlying All Other
Position Year Salary Options/SARs Compensation(d)
($) (#) ($)
Frank L. Driver III 1995 130,000(a) 0 11,254
Chairman of the 1994 108,000(b) 0 14,388
Board of Directors 1993 108,000(c) 11,000 2,000
Frank L. Driver IV 1995 104,000 0 9,200
President
</TABLE>
(a) Annual Base Salary. However, Mr. Driver received $64,000 salary through
June 30, 1995 and $50,000 consulting payments through December 15, 1995.
In addition, Mr. Driver received $21,466 of his 1994 salary which had
been deferred.
(b) Annual Base Salary. In addition, Mr. Driver received $66,534 of his
1993 salary which had been deferred.
(c) Annual Base Salary. Mr. Driver deferred payment of $88,000 pending the
return of a positive cash flow.
(d) Amounts represent the Company's portion of contributions to a 401(k) plan
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
None
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<TABLE>
<S> <S> <S> <S>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End(#) FY-End($)
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Shares Acquired Exercisable(E)/ Exercisable(E)/
Name on Exercise(#) Unexercisable(U) Unexercisable(U)
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Exercisable options:
Estate of
F.L.Driver III None 30,000(E) -
F.L.Driver IV None 45,000(E) -
</TABLE>
PENSION PLANS
Prior to October 31, 1985, the Company had in effect three trusteed non-
contributory defined benefit pension plans covering substantially all U.S.
employees. The participants had the option of retiring at any time after
reaching the age of 60 and at least 15 years of service. An actuarially
determined reduction is applied for retirement before the age of 65. The
participants also had the option to retire without any reduction to their
pension benefits after 30 years of service. On October 31, 1985, pursuant
to a plan of reorganization, the Company terminated the three pension plans
and so advised the Pension Benefit Guaranty Corporation.
On November 21, 1986, the Company entered into a compensation agreement with
Frank L. Driver III, under which Mr. Driver or his spouse would receive an
annual payment of $50,000 for a period of fifteen years after Mr. Driver's
retirement or death. On November 20, 1995, the Board of Directors approved
changing the period to twenty years and the addition of a contingent payment
to this agreement whereby in years where the profit of the Company exceeds
$500,000 before income taxes and before this payment, the $50,000 amount will
be supplemented by an amount based on a formula encompassing total retirement
payments, adjusted annually for the Consumer Price Index. This addition is
expected to result in a further increase of pension payments in years earned
of approximately $15,000. This amount is now payable to Corinne F.Driver,
spouse of Frank L. Driver III, deceased.
COMPENSATION OF DIRECTORS
During 1995, each Director, with the exception of Frank L. Driver III and
Frank L. Driver IV, was paid an annual retainer of $6,000, plus $500 per
Board of Directors Meeting and $400 per Audit or Compensation Committee
Meeting.
ADDITIONAL INFORMATION WITH RESPECT TO COMPENSATION COMMITTEE
INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION DECISION
The Company has a Compensation Committee of its Board of Directors. Mr.
David A.Driver, a member of the committee is an uncle of Frank L. Driver IV,
President and Chief Executive Officer.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Board's Compensation Committee reviews the compensation of the
executive officers of the U.S. holding company annually.
The Company's salary policy is to pay a "competitive salary" plus an
incentive bonus based on profit performance in relation to prior years and in
relation to annual budget profit targets. No incentive bonuses were paid for
1995.
The Compensation Committee may also take into consideration other
factors including dedication to the job, external factors beyond the control
of management, etc.
In 1993 Frank L. Driver III and Frank L. Driver IV, at their request,
deferred a portion of their salaries due to negative cash flow conditions.
In 1994 Frank L. Driver IV received his deferred portion. However, Frank L.
Driver III only received $66,534 with the balance of $21,466 paid in 1995.
Compensation Committee
David A. Driver H. L. Biggerstaff
CUMULATIVE TOTAL SHAREHOLDER RETURN FIVE-YEAR COMPARISON
The table below compares the yearly percentage change in the cumulative
total shareholder return, on Driver-Harris (DRH) common stock, with that of
the cumulative total return of The Russell 2000 Stock Index and a Selected
Peer Group of companies, for a five-year measurement period beginning
December 31, 1990 and ending on December 31, 1995.
<TABLE>
CUMULATIVE TOTAL SHAREHOLDER RETURN FIVE-YEAR COMPARISON (IN TABLE
FORM)
<S> <C> <C> <C> <C> <C> <C>
1990 1991 1992 1993 1994 1995
DRH $100.00 $ 78.79 $ 62.12 $ 89.39 $ 62.12 $ 71.21
Russell 2000 100.00 146.05 172.94 205.64 201.56 258.89
Industry Group 100.00 131.81 138.95 167.85 175.27 234.88
</TABLE>
The table assumes $100 invested at the close of trading on December 31,
1990 in Driver-Harris Company (DRH) common stock, RUSSELL 2000 and the Value
Line Metal Fabricating Industry group. (Cumulative total return assumes
reinvestment of dividends.)
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Frank L. Driver III, Chairman of the Company, until his death on
December 15, 1995, was a brother of David A. Driver, a Director, and the
father of Frank L. Driver IV, President of the Company.
On April 7, 1994 (effective March 18, 1994), the Company restructured
its operations and among other things, became the owner of a fifty percent
interest of HAI Holding Company Inc. and indirectly of Harrison Alloys Inc.
(Harrison). In conjunction with this transaction, Messrs. F. L.
Driver III and IV entered into consulting agreements with Harrison for a five
year period under which each would receive compensation of $25,000 per year.
COMPLIANCE WITH SECTION 16(a) OF EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's Officers and Directors, and persons who own more than ten percent
of a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission and the American Stock Exchange. Officers, directors and greater
than ten-percent shareholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely on review of the copies of such forms furnished to the
Company, or written representations that no Forms 5 were required, the
Company believes that during 1995 all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten-percent
shareholders were complied with.
INDEPENDENT AUDITORS
The principal independent auditors of the Company for the year ended
December 31, 1995 were Ernst & Young LLP, who will act in that capacity again
in 1996. Services rendered by Ernst & Young LLP included an audit of the
Company's consolidated financial statements and the report thereon, meetings
with the Audit Committee and consultation in connection with various
accounting and audit related matters.
A representative of Ernst & Young LLP is expected to be present at the
Annual Meeting with the opportunity to make a statement if he so desires and
to respond to appropriate questions.
STOCKHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Proposals of stockholders intended to be presented at the 1997 Annual
Meeting must be received by the Company on or before January 17, 1997 to be
considered for inclusion in the Company's proxy statement and form of proxy
relative to the meeting. Such proposals should be sent to Lavinia Z. Emery,
Secretary, Driver-Harris Company, 308 Middlesex Street, Harrison, New
Jersey 07029.
OTHER MATTERS
Management is not aware of any matters, other than those referred to
above, that may come before the meeting. If any other matters are properly
presented at the meeting for action, it is intended that the persons named
in the proxies will have discretionary authority to vote on such matters.
Enclosed herewith is the 1995 Annual Report of the Company, including
financial statements for the year ended December 31, 1995. The Annual Report
does not form part of the material for solicitation of proxies.
The Company's 1995 annual report on Form 10-K, including financial
statements and schedules thereto, but excluding exhibits, as filed with the
Securities and Exchange Commission, may be obtained without charge by any
stockholder upon written request to Lavinia Z. Emery, Secretary, Driver-
Harris Company.
By Order of the Board of Directors
Harrison, New Jersey Lavinia Z. Emery
May 3, 1996 Secretary
<PAGE>
APPENDICES
DRIVER-HARRIS COMPANY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
For Annual Meeting to be held on May 29, 1996 at 11:00 a.m.
The undersigned hereby appoints, Frank L. Driver IV and David A. Driver
and each or either of them, attorneys with powers the undersigned would
possess if personally present to vote all stock of the undersigned in Driver-
Harris Company at the Annual Meeting of its stockholders, to be held May 29,
1996 and at any adjournment thereof:
(1) For the election of four directors, namely:
Messrs. Ralph T. Bartlett, H. L. Biggerstaff, David A. Driver,
and Frank L. Driver IV
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR AN INDIVIDUAL
NOMINEE, BUT NOT ALL NOMINEES, PLACE A LINE THROUGH THE
NOMINEE'S NAME.
(2) And upon such other matters which may properly come before the
meeting.
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Dated:__________________1996 -----------------------------------------------
Please sign exactly as name appears on record. If
joint account, each joint owner must sign.
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/__/ Kindly check this box if planning to attend the Annual Meeting.
