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_/ No fee required
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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:
(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:
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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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
(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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
DRIVER-HARRIS COMPANY
308 MIDDLESEX STREET
HARRISON, NEW JERSEY 07029
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held May 27, 1998
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 27, 1998 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 April 24, 1998 will be
entitled to vote at the meeting.
By Order of the Board of Directors:
LAVINIA Z. EMERY
Secretary
Harrison, New Jersey
April 29, 1998
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 27, 1998
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
27, 1998 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 April 29, 1998.
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,
facsimile, 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 April 24, 1998 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
1,340,421 shares were outstanding on April 29, 1998, 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 16, 1998:
<TABLE>
Name and Address Amount and Nature of Percent of
Of Beneficial Owner Beneficial Ownership Class
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<S> <C> <C>
Estate of Frank L. Driver Jr. 64,172* 4.6
2 Delafield Street
Westhampton Beach, NY
Estate of Frank L. Driver III 66,662** 4.8
33 Birdseye Glen
Verona, NJ
Frank L. Driver IV 90,518*** 6.5
33 Birdseye Glen
Verona, NJ
Gerhard Haase 119,700 8.6
2306 West Roscoe
Chicago, IL
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</TABLE>
* All shares held of record and beneficially. As an executor of the Estate
of Frank L. Driver Jr., David A. Driver, Chairman of Driver-Harris Company,
holds voting rights to such shares.
** All shares held of record. Does not include 24,154 shares held by
Corinne Driver, his surviving spouse and the mother of Frank L. Driver IV,
who disclaims any beneficial interest in these shares. As an 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 and 5,014 shares held in the Driver-Harris Staff 401-K
Benefit account.
(b) Security ownership of management as of March 16, 1998:
<TABLE>
Amount and Nature of Percent of
Title of Class Beneficial Ownership Class
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<S> <C> <C>
Driver-Harris Company
Common Stock 287,422* 20.7
</TABLE>
* Includes 45,000 shares under options pursuant to the Driver-Harris Employee
Incentive Stock Option Plan and 5,014 shares held in the Driver-Harris Staff
401-K Benefit account.
(c) Management is not aware of any arrangement which may result in a
change in control of the Company.
<PAGE>
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 16, 1998 for each nominee:
<TABLE>
Company
Principal Occupation Common % of
During Last Five Stock Outstanding
Years and other Director Beneficially Common
Name Age Directorships Since Owned(1) Stock
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<S> <C><S> <C> <C> <C>
Ralph T. Bartlett 73 Certified Public Accountant. 1985 1,350 *
Until 1984 a partner of Deloitte
Haskins & Sells (now Deloitte
& Touche ), NY
H. L. Biggerstaff 71 Retired. Until 1988, President 1980 850 *
Arwood Die Casting Division
of Arwood Corp.
David A. Driver 59 Chairman of Board of Directors. 1977 39,970 2.9
President, Atlantic Alloys Inc.
manufacturer of bi-metallic
components for temperature
control devices.
Frank L. Driver IV 37 President and Chief 1993 90,518** 6.5
Executive Officer
</TABLE>
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* Denotes less than 1% of outstanding.
** Includes 45,000 shares under options pursuant to the Driver-Harris
Employee Incentive Stock Option Plan and 5,014 shares included in the
Driver-Harris Staff 401-K Benefit account.
(1) On March 16, 1998 all Directors of the Corporation as a group (4)
owned beneficially 263,522 shares or 19.0% of the outstanding Common Stock.
This amount includes 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 an executor of the estate of his father, Frank L. Driver III,
which owns 66,662 shares or 4.8% of the outstanding common stock. In
addition David A. Driver is an executor of the estate of his father, Frank
L. Driver Jr., which owns 64,172 shares or 4.6% 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 1997, 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 1997. Messrs. David A. Driver
and H. L. Biggerstaff are members of the Committee.
The Board of Directors held five meetings during calendar 1997.
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
<TABLE>
Long-Term
Annual Compensation
Compensation Awards
Securities Underlying All Other
Name and Principal Position Year Salary Options/SARs Compensation (b)
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($) (#) ($)
<S> <C> <C> <C> <C>
Frank L. Driver IV 1997 90,000 0 9,000
President 1996 100,500 0 10,731
1995 104,000(a) 0 9,200
</TABLE>
(a) Annual base salary, however, $12,000 was deferred until 1996.
(b) Amount represents the Company's portion of contributions to a 401(k)
plan.
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
None.
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTIONS/SAR VALUES
<TABLE>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End(#) FY-End($)
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Shares Acquired Exercisable(E)/ Exercisable(E)/
Name On Exercise(#) Unexercisable(U) Unexercisable(U)
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Exercisable options:
<S> <S> <C> <S>
Frank L. Driver IV None 45,000(E) --
</TABLE>
PENSION PLANS
On November 21, 1986, the Company entered into a pension 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 pension is now payable to Corinne F. Driver, spouse of Frank L. Driver
III,deceased. In 1997, $21,072 was paid as an additional retirement
payment to Corinne F. Driver.
COMPENSATION OF DIRECTORS
During 1997, each Director, with the exception of Frank L. Driver IV, was
paid an annual retainer of $6,000, plus $600 per Board of Directors Meeting
and $400 per Audit or Compensation Committee Meeting. In addition in 1997,
each non-executive Director received 750 shares of Driver-Harris Company
stock, valued at $10.00 per share for a total of $7,500.
ADDITIONAL INFORMATION WITH RESPECT TO COMPENSATION
COMMITTEE
INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION DECISIONS
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. The Compensation Committee may
also take into consideration other factors including dedication to the job,
external factors beyond the control of management, etc. An incentive bonus
of 300 shares of Company stock was paid in 1997 to Thomas J. Carey and
Lavinia Z. Emery.
Compensation Committee
David A. Driver H. L. Biggerstaff
<PAGE>
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 Standard & Poor's Smallcap 600 Index and a
Standard & Poor's Industry Index of companies, for a five-year measurement
period beginning December 31, 1992 and ending on December 31, 1997.
<TABLE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
<S> <C> <C> <C> <C> <C> <C>
1992 1993 1994 1995 1996 1997
DRH 100.00 140.48 97.62 111.90 167.85 195.24
Metal Fabricators-Small100.00 127.67 132.94 184.47 195.38 247.19
S&P Smallcap 600 Index 100.00 118.79 113.12 147.01 178.35 223.98
</TABLE>
The table assumes $100 invested at the close of trading on December 31, 1992
in Driver-Harris Company (DRH) common stock, Standard & Poor's Smallcap 600
Index and Standard and Poor's Industry Index group. (Cumulative total return
assumes reinvestment of dividends.)
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
David A. Driver, Chairman of the Company is the uncle of Frank L. Driver IV,
President.
In 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. However, since September 1996,
Frank L. Driver IV received no compensation from Harrison.
<PAGE>
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 1997 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, 1997 were Ernst & Young LLP, who have been appointed by the Board to act
in that capacity again in 1998. 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 1999 ANNUAL MEETING
Proposals of stockholders intended to be presented at the 1999 Annual Meeting
must be received by the Company on or before January 18, 1999 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 1997 Annual Report of the Company, including
financial statements for the year ended December 31, 1997. The Annual
Report does not form part of the material for solicitation of proxies.
The Company's 1997 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
April 29, 1998 Secretary
<PAGE>
DRIVER-HARRIS COMPANY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
For Annual Meeting to be held on May 27, 1998 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 27, 1998
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.
_____________________________
Dated:______________________1998 _____________________________
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
