<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
ESTERLINE TECHNOLOGIES CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
ESTERLINE TECHNOLOGIES CORPORATION
10800 NE 8TH STREET
BELLEVUE, WASHINGTON 98004
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 5, 1997
------------------------
To the Shareholders of Esterline Technologies Corporation:
NOTICE IS HEREBY GIVEN that the 1997 ESTERLINE TECHNOLOGIES CORPORATION, a
Delaware Corporation (the "Company"), annual meeting of shareholders will be
held on Wednesday, March 5, 1997 at 10:00 a.m., at the Hyatt Regency Bellevue,
900 Bellevue Way, Bellevue, Washington, for the following purposes:
(1) to elect three directors of the Company to serve a term of three years;
(2) to consider and approve the Company's 1997 Stock Option Plan;
(3) to ratify the selection of Deloitte & Touche LLP, as the Company's
independent auditors for the fiscal year 1997; and
(4) to transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on January 6, 1997,
as the record date for determination of shareholders entitled to notice of and
to vote at the meeting or any adjournment or postponement thereof.
The Company's Annual Report for the fiscal year 1996 is enclosed for your
convenience.
By order of the Board of Directors
[SIG]
ROBERT W. STEVENSON
EXECUTIVE VICE PRESIDENT, CHIEF
FINANCIAL OFFICER,
SECRETARY, AND TREASURER
January 17, 1997
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT. PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE TO ENSURE THAT YOUR SHARES WILL BE
REPRESENTED AT THE ANNUAL MEETING. HOLDERS OF A MAJORITY OF THE OUTSTANDING
SHARES MUST BE PRESENT EITHER IN PERSON OR BY PROXY FOR THE MEETING TO BE HELD.
IF YOU ATTEND THE MEETING AND VOTE YOUR SHARES PERSONALLY, ANY PREVIOUS PROXIES
WILL BE REVOKED.
- --------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 5, 1997
------------------------
This proxy statement, which is first being mailed to shareholders on or
about January 17, 1997, has been prepared in connection with the solicitation by
the Board of Directors of Esterline Technologies Corporation (the "Company") of
proxies in the accompanying form to be voted at the 1997 annual meeting of
shareholders of the Company to be held on March 5, 1997, and at any adjournment
or postponement thereof. The Company's principal executive office is at 10800 NE
8th Street, Bellevue, Washington 98004.
The cost of this solicitation will be borne by the Company. In addition to
solicitation by mail, officers and employees of the Company may solicit, without
additional compensation, the return of proxies by telephone, telegram, messenger
or personal interview. Arrangements may also be made with brokerage houses and
other custodians, nominees and fiduciaries to send proxies and proxy material to
their principals, and the Company may reimburse such persons for their expenses
in so doing. Furthermore, the Company has retained D. F. King & Co., Inc. to
provide proxy solicitation services for a fee of approximately $5,000 plus
reimbursement of its out-of-pocket expenses.
Any proxy given pursuant to the solicitation may be revoked at any time
prior to being voted. A proxy may be revoked by the record holder or other
person entitled to vote (a) by attendance in person at the meeting and voting
the shares, (b) by executing another proxy dated as of a later date or (c) by
written notification to the Secretary of the Company, at its address set forth
on the notice of the meeting, if received prior to the meeting date. All shares
represented by valid proxies will be voted at the meeting. Proxies will be voted
in accordance with the specification made therein or, in the absence of
specification, in accordance with the provisions of the proxy.
The Board of Directors has fixed the close of business on January 6, 1997,
as the record date for determination of holders of common stock of the Company
(the "Common Stock") entitled to notice of and to vote at the annual meeting. At
the close of business on the record date there were outstanding and entitled to
vote 8,517,639 shares of Common Stock, which are entitled to one vote per share
held on all matters which properly come before the annual meeting. The presence
in person or by proxy of the holders of record of a majority of the outstanding
shares of Common Stock entitled to vote is required to constitute a quorum for
the transaction of business at the meeting. The Common Stock is listed for
trading on the New York Stock Exchange.
Votes cast by proxy or in person at the annual meeting will be tabulated by
the inspectors of election appointed for the annual meeting. The inspectors of
election will determine whether or not a quorum is present at the annual
meeting. The inspectors of election will treat abstentions as shares of Common
Stock that are present and entitled to vote for purposes of determining the
presence of a quorum. Under certain circumstances, a broker or other nominee may
have discretionary authority to vote certain shares of Common Stock if
instructions have not been received from the beneficial owner or other person
entitled to vote. If a broker or other nominee indicates on the proxy that it
does not have instructions or discretionary authority to vote certain shares of
Common Stock on a particular matter, those shares will not be considered as
present for purposes of determining whether a quorum is present or whether a
matter has been approved.
1
<PAGE>
ELECTION OF DIRECTORS
Three directors are to be elected at the 1997 annual meeting of shareholders
to serve three-year terms expiring at the 2000 annual meeting or until their
successors are elected and qualified. The Board of Directors recommends a vote
FOR the three director nominees named below.
Directors of the Company are normally elected for three-year terms which are
staggered such that one-third of the directors are elected each year. The
current directors whose terms expire at the 1997 annual meeting are Gilbert W.
Anderson, Wendell P. Hurlbut and Malcolm T. Stamper. All have been nominated for
re-election to serve for terms expiring at the 2000 annual meeting.
Information as to each nominee and each director whose term will continue
after the 1997 annual meeting is provided below. The three director nominees who
receive the greatest number of votes cast at the meeting by shareholders
entitled to vote, either in person or by proxy, shall be elected directors. In
the election of directors, any action other than a vote FOR the nominee will
have the practical effect of voting against the nominee. Unless otherwise
instructed, it is the intention of the persons named in the accompanying proxy
to vote shares represented by properly executed proxies FOR the election of the
three nominees named below. The Board of Directors knows of no reason why any of
the nominees will be unable or unwilling to serve. If any nominee becomes
unavailable to serve, it is intended that the persons named as proxies will vote
for the election of such other persons, if any, as the Board of Directors may
recommend.
NOMINEES:
GILBERT W. ANDERSON
PRESIDENT AND CHIEF EXECUTIVE OFFICER (RETIRED), PHYSIO-CONTROL
CORPORATION. Age 68. Mr. Anderson is the retired President and Chief Executive
Officer of Physio-Control Corporation (a medical device manufacturer), having
held such positions from 1986 to 1991 and is a private investor. He is also a
director of Key Trust Company of the Northwest and SpaceLabs Medical. He has
been a director of the Company since 1991.
WENDELL P. HURLBUT
CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, ESTERLINE TECHNOLOGIES. Age
65. Mr. Hurlbut has been Chairman, President and Chief Executive Officer of the
Company since January 1993. From February 1989 through December 1992, he was
President and Chief Executive Officer. From June 1988 to February 1989, he was
President and Chief Operating Officer. From November 1987 to June 1988, he was
Executive Vice President, Operations. Mr. Hurlbut is also a member of the Board
of Directors of the National Association of Manufacturers. He has been a
director of the Company since 1989.
MALCOLM T. STAMPER
VICE CHAIRMAN (RETIRED), THE BOEING COMPANY. Age 71. Mr. Stamper is the
retired President and Vice Chairman of The Boeing Company (an aerospace
company), having held such positions from 1972 to 1990 and has been the
Chairman, Chief Executive Officer and Publisher of Storytellers Ink since 1990.
He is a director of Chrysler Corporation, Whittaker Corp. and Pro-Air. He has
been a director of the Company since 1991.
2
<PAGE>
CONTINUING DIRECTORS:
JOHN F. CLEARMAN
PRESIDENT AND CHIEF EXECUTIVE OFFICER (RETIRED), NC MACHINERY CO. Age 59. Mr.
Clearman is the retired President and Chief Executive Officer of NC Machinery
Co. (a heavy machinery distributor), having held such positions from 1986
through 1994. He has been a director of the Company since 1989 and his term
expires in 1998.
EDWIN I. COLODNY
CHAIRMAN AND CHIEF EXECUTIVE OFFICER (RETIRED), USAIR GROUP, INC. Age 70. Mr.
Colodny is the retired Chief Executive Officer of USAir, Inc., having held this
position from 1975 to 1991; and Chairman and Chief Executive Officer of USAir
Group, Inc. (an airline holding company), having held such positions from 1983
to 1991. He is Of Counsel at Paul, Hastings, Janofsky & Walker. Mr. Colodny is a
director of USAir Group, Inc., Comsat, Inc. and Ascent Entertainment Group, Inc.
He has been a director of the Company since 1992 and his term expires in 1998.
E. JOHN FINN
CHAIRMAN (RETIRED), DORR-OLIVER INCORPORATED. Age 65. Mr. Finn is the retired
Chairman and Partner of Dorr-Oliver Incorporated (a fluid/particle treatment
equipment manufacturer), having held such positions from 1988 to 1995. He is
also a director of Advanced Refractory Technologies and Stanley Technology
Group, Inc. and is on the Advisory Board of Bay Mills Ltd. He has been a
director of the Company since 1989 and his term expires in 1999.
ROBERT F. GOLDHAMMER
CHAIRMAN, IMCLONE SYSTEMS, INCORPORATED. Age 65. Mr. Goldhammer has been the
Chairman of ImClone Systems, Incorporated (a biotechnology company) since 1984.
Prior thereto, he was a Partner and Vice Chairman of the Executive Committee of
Kidder, Peabody & Co. Incorporated. He is a director of EG&G, Inc. and a Partner
at Concord International Investments Group L. P. He has been a director of the
Company since 1974 and his term expires in 1999.
JEROME J. MEYER
CHAIRMAN AND CHIEF EXECUTIVE OFFICER, TEKTRONIX, INC. Age 58. Mr. Meyer has
been the Chairman and Chief Executive Officer of Tektronix, Inc. (an electronic
equipment manufacturer) since 1990 and was the President of Industrial Group of
Honeywell, Inc. from 1988 to 1990. He is a director of Portland General
Corporation, AMP Incorporated and Standard Insurance Company. He has been a
director of the Company since 1992 and his term expires in 1999.
PAUL G. SCHLOEMER
PRESIDENT AND CHIEF EXECUTIVE OFFICER (RETIRED), PARKER HANNIFIN
CORPORATION. Age 68. Mr. Schloemer is the retired President and Chief
Executive Officer of Parker Hannifin Corporation (a manufacturer of motion
control products), having held such positions from 1984 to 1993 and is a
director of Parker Hannifin Corporation, Rubbermaid Incorporated and AMP
Incorporated. He has been a director of the Company since 1993 and his term
expires in 1998.
3
<PAGE>
OTHER INFORMATION AS TO DIRECTORS
DIRECTOR COMPENSATION
The Company pays, in cash, each non-employee director an annual retainer fee
of $20,000 for services on the Board and all committees thereof, a fee of $1,000
for each special meeting attended and a fee of $200 for each telephonic meeting
in which they participate (and are reimbursed for their out-of-pocket expenses
incurred therewith). The Company also pays non-employee committee chairmen an
annual fee of $5,000. In addition, the Company pays non-employee directors
additional compensation in the form of an annual issuance to each director of
$5,000 worth of fully-paid Common Stock and reimburses each such director in
cash for the payment of income taxes ($3,300 at current Federal income tax
rates) on this stock. Employees of the Company serving on the Board and
committees thereof receive no additional compensation for such service. There
were five meetings of the Board of Directors during fiscal 1996.
BOARD COMMITTEES
THE AUDIT COMMITTEE, currently consisting of Messrs. Clearman (Chairman),
Anderson, Colodny, Meyer and Schloemer, recommends to the Board the independent
auditors to be selected to audit the Company's annual financial statements and
reviews the fees charged for audits and for any non-audit assignments. This
Committee also reviews: (1) the scope and results of the annual audit by the
independent auditors, any recommendations of the independent auditors resulting
therefrom and management's response thereto, (2) the accounting principles being
applied by the Company in financial reporting, (3) the activities of the
Company's internal auditors and the adequacy of internal accounting controls,
(4) the Company's environmental compliance practices and management system and
(5) such other related matters as it deems appropriate. The Audit Committee met
five times during 1996.
THE COMPENSATION & STOCK OPTION COMMITTEE, currently consisting of Messrs.
Goldhammer (Chairman), Finn and Stamper, recommends the form and level of
compensation for officers of the Company. The Compensation & Stock Option
Committee has also been appointed by the Board of Directors to administer the
Company's stock option plans and incentive compensation plans. The Compensation
& Stock Option Committee met four times during 1996.
THE EXECUTIVE COMMITTEE, currently consisting of Messrs. Hurlbut (Chairman),
Finn, Goldhammer and Stamper, reviews situations that might, at some future
time, become items for consideration of the entire Board of Directors and acts
on behalf of the entire Board of Directors between its meetings. The Executive
Committee met twice during fiscal 1996.
THE NOMINATING COMMITTEE, currently consisting of Messrs. Stamper
(Chairman), Colodny and Finn, recommends individuals to be presented to the
shareholders of the Company for election or re-election to the Board of
Directors. Written proposals from shareholders for nominees for directors to be
elected at the 1998 annual meeting which are submitted to the Secretary of the
Company by September 15, 1997, and which contain sufficient background
information concerning the nominee to enable a proper judgment to be made as to
his or her qualifications, will be considered by the Nominating Committee. The
Nominating Committee met once during fiscal 1996.
Each director, during fiscal 1996, attended at least 75% of the total number
of meetings of the Board of Directors and Board committees of which he was a
member.
4
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of shares of Common Stock as of October 31, 1996, by (i) each person
or entity who is known by the Company to own beneficially more than 5% of the
Common Stock, (ii) each of the Company's directors, (iii) each of the Company's
named executive officers and (iv) all directors and executive officers of the
Company as a group.
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER(1) SHARES(2) CLASS
- ------------------------------------------------------------------------------------ --------------- ----------
<S> <C> <C>
The Prudential Insurance Company of America......................................... 583,800(3) 6.9%
Prudential Plaza, Newark, NJ 07102
Wendell P. Hurlbut.................................................................. 156,821(4) 1.8%
Robert W. Cremin.................................................................... 86,350(4)(5) 1.0%
Robert W. Stevenson................................................................. 83,487(4)(5) 1.0%
Larry A. Kring...................................................................... 75,825(4) *
Stephen R. Larson................................................................... 69,375(4) *
E. John Finn........................................................................ 18,568 *
Robert F. Goldhammer................................................................ 11,318 *
John F. Clearman.................................................................... 5,568 *
Gilbert W. Anderson................................................................. 2,690 *
Edwin I. Colodny.................................................................... 2,568 *
Jerome J. Meyer..................................................................... 1,568 *
Paul G. Schloemer................................................................... 1,568 *
Malcolm T. Stamper.................................................................. 1,568 *
Directors, nominees and executive officers as a group (14 persons).................. 525,399(4)(5) 5.9%
</TABLE>
- ------------------------
* Less than 1%
(1) Unless otherwise indicated, the business address of each of the shareholders
named in this table is Esterline Technologies Corporation, 10800 NE 8th
Street, Bellevue, Washington 98004.
(2) Unless otherwise indicated in the footnotes to this table, the person and
entities named in the table have sole voting and sole investment power with
respect to all shares beneficially owned, subject to community property laws
where applicable.
(3) The holding shown is based on a Schedule 13G filed with the Securities and
Exchange Commission (the "SEC") on or about February 9, 1996, and certain
other information provided by The Prudential Insurance Company of America,
an insurance company, a registered broker-dealer and a registered investment
advisor that disclaims beneficial ownership of these shares. Based on such
information, shared voting and dispositive power is reported with respect to
all of the shares.
(4) Includes shares subject to options granted under the Company's 1987 Stock
Option Plan which are exercisable currently or within 60 days of the date of
this proxy statement as follows: Mr. Hurlbut, 117,500 shares; Mr. Cremin,
83,750 shares; Mr. Stevenson, 73,125 shares; Mr. Kring, 70,625 shares; Mr.
Larson, 69,375 shares; and directors, nominees and executive officers as a
group, 422,500 shares.
(5) Includes shares held in the name of children as follows: Mr. Cremin, 300
shares and Mr. Stevenson, 6,200 shares.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes compensation paid or accrued during fiscal
years 1996, 1995 and 1994 for services in all capacities to the Company by the
persons who, at October 31, 1996, were the Chief Executive Officer and the four
other most highly compensated executive officers of the Company (collectively,
the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION AWARDS
-------------------------
ANNUAL COMPENSATION SECURITIES
UNDERLYING PAYOUTS
-------------------- OPTIONS ------------ ALL OTHER
SALARY BONUS GRANTED LTIP PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#) ($)(1) ($)(2)
- ---------------------------------------- --------- --------- --------- ----------- ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Wendell P. Hurlbut ..................... 1996 401,667 217,947 20,000 589,695 2,375
Chairman of the Board, President and 1995 379,167 346,500 30,000 131,105 2,310
Chief Executive Officer 1994 350,000 358,750 30,000 -- 2,310
Robert W. Cremin ....................... 1996 266,667 127,136 65,000 212,427 2,375
Executive Vice President and 1995 247,500 168,750 15,000 46,273 2,310
Chief Operating Officer (3) 1994 235,000 170,406 10,000 -- 2,310
Robert W. Stevenson .................... 1996 265,000 106,955 7,500 223,465 2,375
Executive Vice President, 1995 262,500 178,875 10,000 53,985 2,310
Chief Financial Officer, 1994 250,000 196,875 15,000 -- 2,310
Secretary and Treasurer
Larry A. Kring ......................... 1996 237,500 86,102 7,500 192,289 2,375
Group Vice President 1995 222,500 135,000 10,000 42,416 2,310
1994 210,000 135,500 10,000 -- 2,310
Stephen R. Larson ...................... 1996 222,500 80,721 7,500 192,289 2,375
Group Vice President 1995 208,333 126,000 10,000 42,416 2,310
1994 198,167 130,000 10,000 -- 2,310
</TABLE>
- ------------------------
(1) Payouts pursuant to the Company's long-term incentive plan. Subsequent to
the close of fiscal 1996, the Board approved the Compensation & Stock Option
Committee's recommendation to terminate the three open four-year cycles
under the Company's long-term incentive compensation plan. With respect to
compensation reported in fiscal 1996, amounts shown include settlement of
all amounts accrued and due through the date of termination under open
cycles of the discontinued plan. The Committee has since adopted a new
long-term incentive compensation plan. See "Compensation Committee
Report--Long-Term Incentive Plan."
(2) Amounts contributed to or accrued by the Company for the Named Executive
Officer under the Company's 401(k) plan.
(3) Executive Vice President and Chief Operating Officer since October 1, 1996,
at a new annual salary of $315,000; prior to that date, Senior Vice
President and Group Executive of the Company.
6
<PAGE>
OPTIONS GRANTED IN THE FISCAL YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------------------
NUMBER OF POTENTIAL REALIZABLE VALUE AT
SECURITIES ASSUMED ANNUAL RATES OF STOCK
UNDERLYING % OF TOTAL PRICE APPRECIATION FOR OPTION
OPTIONS OPTIONS GRANTED TERM(1)
GRANTED TO EMPLOYEES IN EXERCISE ----------------------------------
NAME (#) FISCAL YEAR PRICE($/SH) EXPIRATION DATE 0%($) 5%($) 10%($)
- ------------------------------ ----------- ----------------- ----------- ------------------- ----------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Wendell P. Hurlbut............ 20,000(2) 16% 23.375 December 2005 0 294,008 745,075
Robert W. Cremin.............. 15,000(2) 23.375 December 2005 0 220,506 558,806
50,000(3) 50% 21.000 September 2006 0 660,339 1,673,430
Robert W. Stevenson........... 7,500(2) 6% 23.375 December 2005 0 110,253 279,403
Larry A. Kring................ 7,500(2) 6% 23.375 December 2005 0 110,253 279,403
Stephen R. Larson............. 7,500(2) 6% 23.375 December 2005 0 110,253 279,403
</TABLE>
- ------------------------
(1) The potential realizable value is based on the assumption that the stock
price for the Common Stock appreciates at the annual rate shown (compounded
annually) from the date of grant until the end of the ten year option term
as specified by the SEC. These increases in value are based on assumptions
required under the rules of the SEC and are not intended to forecast
possible future appreciation, if any, of the Company's stock price. Actual
realizable value, if any, on stock option exercises is dependent on the
future performance of the Common Stock as well as the option holder's
continued employment with the Company.
(2) The grants were made in December 1995 pursuant to the Company's 1987 Stock
Option Plan. The exercise price of the options is equal to the fair market
value of the Common Stock on the date of grant. The options vest at the rate
of twenty-five percent per year on each of the first four anniversaries of
the date of grant. In the event any person becomes the beneficial owner of
30% or more of the Common Stock, including by means of a tender offer, or
upon approval by the Company's shareholders of a merger or similar
transaction providing for the exchange of more than 50% of the Company's
shares into cash, property or securities of a third party, all options held
by the Named Executive Officers under the 1987 Stock Option Plan will become
immediately exercisable.
(3) This grant was made in September 1996 upon promotion to Executive Vice
President and Chief Operating Officer and is subject to the same other
provisions as identified in (2) above.
7
<PAGE>
AGGREGATED OPTION EXERCISES IN THE FISCAL YEAR ENDED OCTOBER 31, 1996,
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED,
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
SHARES VALUE YEAR END(#)(3) FISCAL YEAR END($)(4)
ACQUIRED ON REALIZED -------------------------- -------------------------
NAME EXERCISE(#)(1) ($)(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------- ------------- --------- ----------- ------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Wendell P. Hurlbut................... 50,000 862,500 97,500 57,500 1,228,125 476,250
Robert W. Cremin..................... 7,500 111,563 73,750 81,250 956,250 316,875
Robert W. Stevenson.................. 25,000 411,063 65,000 22,500 894,375 198,750
Larry A. Kring....................... -- -- 63,750 38,750 950,000 440,000
Stephen R. Larson.................... -- -- 62,500 20,000 795,625 158,750
</TABLE>
- ------------------------
(1) All of the shares were acquired under the cashless exercise procedure
provided for in the Company's 1987 Stock Option Plan. The procedure provides
for payment of the exercise price of the options and Federal taxes incurred
upon such exercise by the optionees through withholding of shares otherwise
issuable upon such exercise, valued at market on the date of exercise. The
net number of shares issued pursuant to such exercise was as follows: Mr.
Hurlbut, 20,136; Mr. Cremin, 3,440; and Mr. Stevenson, 11,862.
(2) The value realized is the difference between the fair market value of the
underlying Common Stock at the time of exercise and the aggregate exercise
price of the options.
(3) Exercisable/unexercisable amounts are as of October 31, 1996.
(4) Based on the closing price of the Common Stock on October 31, 1996, as
reported on the New York Stock Exchange ($23.375), less the exercise price,
multiplied by the number of in-the-money options held. There is no guarantee
that, if and when these options are exercised, they will have this value.
LONG-TERM INCENTIVE PLANS AWARDS IN THE FISCAL YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
PERFORMANCE OR ESTIMATED FUTURE PAYOUTS UNDER
NUMBER OF SHARES, OTHER PERIOD NON-STOCK PRICE-BASED PLANS(1)
UNITS UNTIL MATURATION --------------------------------------
NAME OR OTHER RIGHTS OR PAYOUT THRESHOLD($) TARGET($) MAXIMUM($)
- --------------------------------------- ------------------- ---------------- ------------- --------- ------------
<S> <C> <C> <C> <C> <C>
Wendell P. Hurlbut..................... -- 1996-1999 68,750 275,000 550,000
Robert W. Cremin....................... -- 1996-1999 25,000 100,000 200,000
Robert W. Stevenson.................... -- 1996-1999 25,000 100,000 200,000
Larry A. Kring......................... -- 1996-1999 22,500 90,000 180,000
Stephen R. Larson...................... -- 1996-1999 22,500 90,000 180,000
</TABLE>
- ------------------------
(1) The above awards were made pursuant to the Company's prior long-term
incentive compensation plan which has since been terminated. Under this
plan, payments were to be made either in cash or Common Stock, based on the
Company's earnings per share and return on equity performance over a period
of four years relative to the performance of a selected comparable group of
companies. No awards would be paid unless performance met certain minimum
standards. Partial payments were to be made based on performance through
years two and three, with final awards paid after the fourth year of each
cycle. (See Compensation Committee Report, following this section.)
8
<PAGE>
Subsequent to the close of fiscal 1996, the Board of Directors approved the
Compensation & Stock Option Committee's recommendation to terminate the three
open four-year cycles under the Company's long-term incentive compensation plan
including the awards described in the previous table. Amounts payable in
settlement of all amounts accrued and due under the open cycles were paid and
are disclosed in the Summary Compensation Table. A new long-term incentive plan
has been adopted by the Board of Directors which covers the period fiscal 1997
through 1999 with identical annual target amounts to those listed previously.
RETIREMENT BENEFITS
The Named Executive Officers are covered by a tax-qualified defined benefit
retirement plan (which covers substantially all U.S. employees of the Company)
and a Supplemental Executive Retirement Plan (the "SERP") which requires an
employee contribution of 1% of annual compensation. Under the plans, benefits
accrue until retirement, limited to 30 years of service, with normal retirement
at age 65. Under the tax-qualified defined benefit retirement plan, retirees are
entitled to receive an annuity computed under a five-year average compensation
formula, which includes salary, amounts earned under annual and long-term
incentive compensation plans and amounts realized upon exercise of stock
options, less expected Social Security benefits. The SERP provides benefits in
excess of statutory limits and entitles retirees to receive an annuity computed
under a restricted version of the five-year average compensation formula, which
excludes amounts earned under the long-term incentive compensation plan and
amounts realized upon exercise of stock options. The SERP also provided that Mr.
Hurlbut receive retirement plan service maximums at age 65. The retirees may
select either a life annuity or one of several alternative forms of payment with
an equivalent actuarial value.
The approximate annual annuity payable upon retirement to the Named
Executive Officers is shown in the following table. The amounts shown are for
retirement at age 65. Benefits are integrated with Social Security based on the
career average Social Security wage base in effect in 1996. To the extent the
wage base is increased after 1996, the benefits payable under the retirement
plan would be lower than the amounts shown.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE AT RETIREMENT
----------------------------------------------------------
AVERAGE COMPENSATION 10 15 20 25 30
- ----------------------------------------------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
$100,000............................................. $ 13,600 $ 20,400 $ 27,200 $ 34,000 $ 40,800
250,000............................................. 37,600 56,400 75,200 94,000 112,800
400,000............................................. 61,600 92,400 123,200 154,000 184,800
550,000............................................. 85,600 128,400 171,200 214,000 256,800
700,000............................................. 109,600 164,400 219,200 274,000 328,800
850,000............................................. 133,600 200,400 267,200 334,000 400,800
</TABLE>
The Named Executive Officers currently have the following completed years of
credited service for purposes of the defined benefit retirement plan: Mr.
Hurlbut, 22; Mr. Stevenson, 23; Mr. Cremin, 19; Mr. Kring, 3; and Mr. Larson,
17.
TERMINATION AGREEMENTS
The Company has entered into termination protection agreements with the
Named Executive Officers which are designed to induce them to remain in the
employ of the Company or any successor company in the event of certain changes
in ownership or control by assuring compensation benefits if an officer is
terminated "Without Cause" or resigns for "Good Reason," as defined in the
agreements. In the event of such termination within two years after a change in
ownership or control, the agreements provide for lump sum payments equal to
twice the average compensation received during the prior two years, payment of
9
<PAGE>
certain legal fees and expenses associated with the termination and insurance
benefits for the remainder of the initial two-year period or until other
full-time employment is accepted.
COMPENSATION COMMITTEE REPORT
EXECUTIVE COMPENSATION PRINCIPLES
The Compensation & Stock Option Committee (the "Committee") is responsible
for administering the compensation program for the executive officers of the
Company. The Committee is composed exclusively of independent, non-employee
directors who are not eligible to participate in any of the executive
compensation programs.
The Company's executive compensation practices are based on principles
designed to align executive compensation with Company objectives, business
strategy, management initiatives and financial performance. In applying these
principles the Committee has established a program to:
- Support a performance-oriented environment that rewards performance not
only with respect to the Company's annual results but also Company
performance as compared to that of longer-term industry performance
levels.
- Reward executives for long-term strategic management and the enhancement
of shareholder value.
- Attract and retain key executives critical to the success of the Company.
EXECUTIVE COMPENSATION PROGRAM
Each executive's total compensation consists of both cash and equity-based
compensation. The cash portion consists of salary, an annual incentive plan and
a long-term incentive plan. The equity portion consists of awards under the
Company's stock option plans.
SALARY:
The Committee determines the salary for key executive officers based upon
surveys of salaries for positions of comparable responsibility taking into
account competitive norms and the experience of the person being considered.
Subsequent salary changes are based upon individual performance or changes in
responsibilities.
ANNUAL INCENTIVE PLAN:
At the beginning of the fiscal year, the Committee establishes a "target"
award amount for each executive (stated as a percentage of the executive's base
salary) and performance measurement goals for the year. The award amount
calculated pursuant to the plan formula can range from 0% to 150% of each
executive's "target" award amount.
After award amounts are computed under the plan formula, the Committee may,
at its discretion, adjust the actual amount paid to each executive upward or
downward by as much as 25% of the greater of the executive's computed award or
the executive's target award amount. The ability of the Committee to make
subjective adjustments to award amounts reflects the Committee's concern that
the performance of the Company measured against the goals established at the
beginning of the year may not fully reflect the achievements of management. No
award may exceed 112.5% of the executive's base salary.
For 1996, the Committee selected earnings per share as the sole performance
goal. Award amounts computed under the plan formula ranged from 35.9% to 53.8%
of base salary. No adjustments under the discretionary formula were made.
10
<PAGE>
LONG-TERM INCENTIVE PLAN:
Effective October 31, 1996, the existing long-term incentive compensation
plan was terminated. Final payouts for this plan were calculated based only on
performance to date for the completed portion of outstanding cycles. In December
1996, the Committee adopted a new long-term incentive compensation plan to
supplant the discontinued arrangement. The new plan will cover the
three-fiscal-year period ending in October 1999 and is based on three groups of
objectives: GROUP I establishes target earnings per share growth and target
return on shareholders equity; GROUP II establishes strategic operating
performance objectives for the Committee to monitor which may be altered from
time to time by the Committee; and GROUP III establishes relative earnings per
share and return on equity performance measurements compared to a peer group of
companies and industries. Each of the three groups of objectives is weighted
equally. The new plan contemplates partial payouts based on Committee evaluation
of performance and provides for annual updating of objectives when the Committee
deems appropriate.
STOCK OPTIONS:
The portion of the long-term incentives provided from stock options
contemplates that the Company's assessment of the annual future gain potential
of an executive's previously granted stock options should approximate the
targeted annual payment from the long-term incentive compensation plan. The
Committee periodically reviews each executive's situation in this light and
grants additional options if deemed needed. In December 1995 and 1996, the
Committee awarded the officers options to purchase, in the aggregate, 65,000 and
70,000 shares, respectively, of the Common Stock at fair value on the date of
grant. In addition, upon promotion of Mr. Cremin to the position of Executive
Vice President and Chief Operating Officer in September 1996, the Committee
granted him options to purchase an additional 50,000 shares of Common Stock.
CHIEF EXECUTIVE OFFICER COMPENSATION:
The Compensation Committee believes the CEO's compensation should be
structured so that the payouts from the annual incentive plan and the long-term
incentive compensation plan relate closely to the Company's performance and has
followed a policy of providing the CEO a compensation package for target Company
performance which, in addition to base salary, would pay cash incentives of up
to 125% of salary. Additionally, an amount approximately equal to 75% of salary
is targeted to be earned through annual gains from stock options. On January 1,
1996 and 1997, the CEO's salary was increased to $405,000 and $425,000,
respectively. His award under the 1996 annual incentive plan was $217,947 (53.8%
of base salary), and the earned portion of the discontinued long-term incentive
plan was $589,695 (146% of salary). In December 1995 and 1996, the Committee
awarded the CEO options to purchase 20,000 and 18,000 shares, respectively, of
the Company's Common Stock at fair market value on the date of grant.
Each year, the Committee separately reviews the CEO's salary and
participation levels in both the annual incentive plan and long-term incentive
plan.
Respectfully submitted,
ROBERT F. GOLDHAMMER, CHAIRMAN
E. JOHN FINN
MALCOLM T. STAMPER
11
<PAGE>
COMMON STOCK PRICE PERFORMANCE GRAPH
The following graph compares the cumulative total return to shareholders on
the Common Stock during the years 1991 through 1996 with the cumulative total
return of the Standard & Poor's 500 Stock Index, the Standard & Poor's
Technology Sector Index (formerly the High Technology Composite Index) and the
Standard & Poor's Capital Goods Index. The cumulative total return on the Common
Stock and each index assumes the value of each investment was $100 on October
31, 1991, and that all dividends were reinvested. The measurement dates plotted
below indicate the last trading date of each fiscal year shown. The stock price
performance shown in the graph is not necessarily indicative of future price
performance.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ESTERLINE S&P 500 S&P TECHNOLOGY S&P CAPITAL
TECHNOLOGIES STOCK INDEX SECTOR INDEX* GOODS INDEX**
<S> <C> <C> <C> <C>
1991 100 100 100 100
1992 85 110 101 100
1993 65 126 125 110
1994 108 131 152 128
1995 201 166 231 159
1996 203 206 279 205
</TABLE>
- ------------------------
* For preceding years, the Company has compared stock results to the S&P High
Technology Composite Index. As of July 1996, the S&P reorganized their
indices and the aerospace industry was transferred to the Capital Goods
Index. As a result of this transfer, the new S&P Technology Sector Index is
not representative of an appropriate peer group for Esterline.
** The S&P Capital Goods Index is the new selected peer group for fiscal 1997
and forward.
APPROVAL OF A NEW NON-QUALIFIED STOCK OPTION PLAN
On September 18, 1996, the Board of Directors adopted, subject to
shareholder approval, the Esterline Technologies Corporation 1997 Stock Option
Plan (the "1997 Plan"), which provides for the grant of non-qualified stock
options ("NSOs" or "Options") to officers (including officers who are directors)
and other key employees of the Company and its subsidiaries. If the plan is
approved by shareholders, four hundred thousand (400,000) shares of common stock
will be reserved for issuance pursuant to awards under the 1997 Plan. No awards
have been granted at this time.
The purposes of the 1997 Plan are to further the long-term growth in
earnings of the Company by providing a special incentive to selected officers
and other key employees of the Company and its subsidiaries who are responsible
for such growth; to facilitate the ownership of shares of Common Stock by such
individuals, thereby increasing the identity of their interests with those of
the Company's shareholders; and to assist the Company in attracting and
retaining such individuals with experience and ability. Adoption of a new stock
option plan at this time is necessary due to the expiration of the Company's
1987 Stock Option Plan by its terms on October 27, 1997.
12
<PAGE>
The 1997 Plan is designed to comply with the requirements for "performance
based compensation" under Section 162(m) of the Internal Revenue Code of 1986,
as amended (the "Code"), and the conditions for exemption from the short-swing
profit recovery rules under Rule 16b-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The summary that follows is subject to
the actual terms of the 1997 Plan, a copy of which is attached as Exhibit A
hereto.
PLAN ADMINISTRATION
The 1997 Plan will be administered by the Company's Board of Directors or a
committee thereof consisting solely of two or more directors of the Company who
are "outside directors" within the meaning of Section 162(m) of the Code and
"non-employee directors" within the meaning of Rule 16b-3 under the Exchange Act
(such Board or committee sometimes referred to herein as the "plan
administrator"). It is expected that the Compensation & Stock Option Committee
will serve as the plan administrator. Members of the Board or committee do not
receive any remuneration under the 1997 Plan in their capacity as administrators
of the 1997 Plan. The 1997 Plan provides that no member of the Board or
committee will be liable for any action or determination taken or made in good
faith with respect to the 1997 Plan or any NSO granted thereunder.
Subject to the terms of the 1997 Plan, the Committee has the right to grant
NSOs to eligible recipients and to determine the terms and conditions of the
stock option agreements evidencing the grant of such NSOs, including the vesting
schedule and exercise price of such NSOs; provided, that the exercise price will
not be less than the fair market value of the Common Stock on the date of grant.
SECURITIES SUBJECT TO THE 1997 PLAN
There are reserved for issuance under the 1997 Plan four hundred thousand
(400,000) treasury or authorized but unissued shares of Common Stock. The
aggregate number of shares of Common Stock as to which NSOs may be granted to
any participant during the term of the 1997 Plan may not, subject to adjustment
as set forth below, exceed 80% of the shares of Common Stock reserved for
issuance under the 1997 Plan.
The 1997 Plan provides that, in the event of changes in the Common Stock by
reason of a merger, reorganization, recapitalization, common stock dividend,
stock split or similar change, the plan administrator will make appropriate
adjustments to (i) the aggregate number of shares available for issuance under
the 1997 Plan and (ii) the purchase price to be paid and/or the number of shares
issuable upon the exercise thereafter of any NSO previously granted.
ELIGIBILITY
Discretionary grants of NSOs may be made to any officer (including officers
who are directors) or other key employee of the Company or its direct and
indirect subsidiaries who is determined by the plan administrator to be in a
position to contribute to the long-term growth in earnings of the Company.
EXERCISE OF OPTIONS
Options will vest and become exercisable according to a schedule established
by the plan administrator. In the case of options exercisable by installment,
options not exercised during any one year may be accumulated and exercised at
prescribed times during the remaining years of the option. Options that are not
exercised within ten years from the date of grant will expire without value.
Options are exercisable during the optionee's lifetime only by the optionee.
Notwithstanding the foregoing, all options granted under the 1997 Plan shall
vest and become immediately exercisable upon the approval by the Board of
Directors of a sale(s) or other disposition(s) aggregating, during any
twelve-month period, 30% or more of the equity book value of the Company as
13
<PAGE>
measured at the month-end immediately preceding the first such sale or
disposition. In addition, the 1997 Plan provides that options granted to
executive officers shall accelerate and become immediately exercisable upon the
occurrence of certain events constituting a "change in control" of the Company,
including (i) the acquisition by certain persons of 30% or more of the Company's
voting shares, (ii) a merger or other consolidation pursuant to which the
Company's shareholders do not retain at least 70% of the voting power of the
stock of the surviving entity, (iii) certain changes in the composition of the
Company's Board of Directors or (iv) the liquidation or dissolution of the
Company or the sale of all or substantially all its assets.
All options granted, which have not as yet become exercisable, will
terminate immediately upon termination of employment for any reason or upon
death. All rights to exercise vested options terminate not more than three
months after the option holder's employment terminates for any reason other than
death, disability, or in certain cases, retirement.
In no event may any option be exercisable more than ten years from the date
it is granted. Options are not transferable, other than by will or the laws of
descent and distribution, and are exercisable during the recipient's lifetime
only by the recipient.
The purchase price of the stock purchased pursuant to the exercise of an
option will be as determined by the plan administrator and may be adjusted in
accordance with the antidilution provisions described in "Securities Subject to
the 1997 Plan." Upon the exercise of any option, the purchase price must be
fully paid in cash or, at the discretion of the plan administrator, by delivery
of Common Stock equal in market value to the exercise price, or through a
cashless exercise procedure, or by a combination of cash, delivery of common
stock and a cashless exercise procedure. Option holders may also use a cashless
exercise procedure to pay the amount necessary to meet tax withholding
requirements.
AMENDMENT AND TERMINATION
If approved by shareholders, the Plan will remain in effect for a period of
ten (10) years. The Board of Directors may terminate or amend the 1997 Plan at
any time, except that shareholder approval is required for any amendment to (i)
increase the maximum number of shares of stock which may be issued under the
1997 Plan (except for adjustments set forth in the 1997 Plan), (ii) change the
class of individuals eligible to participate in the 1997 Plan or (iii) extend
the term of the 1997 Plan or the period during which any option may be
exercised, but only to the extent required by Section 162(m) of the Code or
other applicable law with respect to the material amendment of any employee
benefit plan maintained by the Company. Termination or amendment of the 1997
Plan will not affect previously granted NSOs, which will continue in effect in
accordance with their terms.
PAYMENT OF TAXES
Participants are required, not later than the date as of which the value of
an award first becomes includable in the gross income of the participant for
Federal income tax purposes, to pay to the Company, or make arrangements
satisfactory to the plan administrator regarding payment of any Federal, state,
or local taxes of any kind required by law to be withheld with respect to the
award. The obligations of the Company under the 1997 Plan are conditional on the
making of such payments or arrangements and the Company will have the right, to
the extent permitted by law, to deduct any such taxes from any payment of any
kind otherwise due to the participant.
14
<PAGE>
CERTAIN FEDERAL INCOME TAX EFFECTS
THE FOLLOWING IS A GENERAL DESCRIPTION OF THE FEDERAL INCOME TAX
CONSEQUENCES TO PARTICIPANTS AND THE COMPANY RELATING TO NSOS THAT MAY BE
GRANTED UNDER THE PLAN. THIS DISCUSSION DOES NOT PURPORT TO COVER ALL TAX
CONSEQUENCES RELATING TO NSOS AND ASSUMES THAT, TO THE EXTENT APPLICABLE, THE
REQUIREMENTS OF SECTION 162(M) OF THE CODE HAVE BEEN SATISFIED.
A participant will generally not be taxed upon the grant of an NSO. Rather,
at the time of exercise of such NSO, the participant will recognize ordinary
income for Federal income tax purposes in an amount equal to the excess of the
fair market value of the shares purchased over the option price. The Company
will generally be entitled to a tax deduction at such time and in the same
amount that the participant recognizes ordinary income.
If shares acquired upon exercise of an NSO are later sold or exchanged, then
the difference between the sales price and the fair market value of such stock
on the date that ordinary income was recognized with respect thereto will
generally be taxable as long-term or short-term capital gain or loss (if the
stock is a capital asset of the participant) depending upon whether the stock
has been held for more than one year after such date.
According to a published ruling of the Internal Revenue Service, a
participant who pays the option price upon exercise of an NSO, in whole or in
part, by delivering shares of the Company's Common Stock already owned by him
will recognize no gain or loss for Federal income tax purposes on the shares
surrendered, but otherwise will be taxed according to the rules described above
for NSOs. With respect to shares acquired upon exercise which are equal in
number to the shares surrendered, the basis of such shares will be equal to the
basis of the shares surrendered, and the holding period of the shares acquired
will include the holding period of the shares surrendered. The basis of
additional shares received upon exercise will be equal to the fair market value
of such shares on the date which governs the determination of the participant's
ordinary income, and the holding period for such additional shares will commence
on such date.
NEW PLAN BENEFITS
As of January 17, 1997, the Board of Directors has not granted or promised
to grant any NSOs under the 1997 Plan. Accordingly, it is not possible to
determine at this time the number of NSOs to be granted to specific employees or
groups of employees under the 1997 Plan. Information regarding recent stock
option grants to the Company's Named Executive Officers is set forth under
"Executive Compensation." The closing market price of the Company's Common Stock
on the New York Stock Exchange as reported on January 10, 1997, was $24 per
share.
VOTE REQUIRED
The affirmative vote of the holders of a majority of the shares of Common
Stock present in person or represented by proxy and entitled to vote at the
annual meeting will be required for approval of the proposed 1997 Plan. An
abstention from voting will have the practical effect of a vote against the 1997
Plan. Broker non-votes will have no impact on the outcome of the vote. Unless
otherwise instructed, it is the intention of the persons named in the
accompanying form of proxy to vote shares represented by properly executed
proxies in favor of the adoption and approval of the 1997 Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF THE
PLAN.
15
<PAGE>
SELECTION OF INDEPENDENT AUDITORS
The selection by the Board of Directors, on the recommendation of the Audit
Committee, of Deloitte & Touche LLP, Seattle, Washington, as independent
auditors to audit the financial statements of the Company for the fiscal year
ending October 31, 1997, is to be submitted to the meeting for ratification.
Said firm has audited the financial statements of the Company since 1987.
Representatives of Deloitte & Touche LLP will be present at the 1997 annual
meeting, will be given the opportunity to make a statement if they wish to do
so, and will be available to respond to appropriate questions.
The Company is not obligated by law or its Certificate of Incorporation or
Bylaws to seek ratification of the directors' selection of auditors, but does so
as a matter of corporate policy. If the selection of auditors is not ratified by
shareholders, the Board may continue to use Deloitte & Touche LLP as auditors or
select new auditors if, in the opinion of the Board, such a change would be in
the best interest of the Company and its shareholders; any such change would not
be expected to be submitted to shareholders for ratification prior to the 1998
annual meeting.
The affirmative vote of a majority of the votes cast by shareholders present
in person or by proxy and entitled to vote at the meeting is required to ratify
the appointment of Deloitte & Touche LLP as independent auditors.
COMPLIANCE WITH FORMS 3, 4 AND 5 REPORTING REQUIREMENTS
Based solely upon a review of reports on Forms 3, 4 and 5 and any amendments
thereto furnished to the Company pursuant to Section 16 of the Exchange Act, as
amended, and written representations from the executive officers and directors
that no other reports were required, the Company believes that all of such
Reports were filed on a timely basis by executive officers and directors during
1996.
OTHER MATTERS
As of the date of this proxy statement, the only matters which management
intends to present at the meeting are those set forth in the notice of meeting
and in this proxy statement. Management knows of no other matters which may come
before the meeting. However, if any other matters properly come before the
meeting, it is intended that proxies in the accompanying form will be voted in
respect thereof in accordance with the judgment of the person or persons voting
as proxies.
SHAREHOLDER PROPOSALS FOR 1998
An eligible shareholder who wants to have a qualified proposal considered
for inclusion in the proxy statement for the 1998 annual meeting must notify the
Secretary of the Company. The proposal must be received at the Company's
principal executive office no later than September 15, 1997. A shareholder must
have been a registered or beneficial owner of at least one percent of the
outstanding shares of Common Stock or shares of Common Stock with a market value
of $1,000 for at least one year prior to submitting the proposal and the
shareholder must continue to own such stock through the date on which the
meeting is held.
By order of the Board of Directors
[SIG]
ROBERT W. STEVENSON
EXECUTIVE VICE PRESIDENT,
CHIEF FINANCIAL OFFICER,
SECRETARY AND TREASURER
16
<PAGE>
January 17, 1997
17
<PAGE>
EXHIBIT A
ESTERLINE TECHNOLOGIES CORPORATION
1997 STOCK OPTION PLAN
1. PURPOSE. The name of this plan is the Esterline Technologies
Corporation 1997 Stock Option Plan (the "Plan"). The purpose of the Plan is to
enable the Company to attract and retain highly qualified personnel who will
contribute to the Company's success by their ability, ingenuity and industry and
to provide incentives to the participating officers (including officers who are
directors) and other key employees that are linked directly to increases in
shareholder value and will therefore inure to the benefit of all shareholders of
the Company.
2. DEFINITIONS.
2.1 "ADMINISTRATOR" means the Board, or if and to the extent the Board
does not administer the Plan, the Committee in accordance with
Section 3.
2.2 "AFFILIATE" shall have the meaning set forth in Rule 12b-2
promulgated under Section 12 of the Exchange Act.
2.3 "BENEFICIAL OWNER" shall have the meaning set forth in Rule 13d-3
under the Exchange Act.
2.4 "BOARD" means the Board of Directors of the Company.
2.5 "CODE" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor thereto.
2.6 "COMMITTEE" means the Compensation and Stock Option Committee of the
Board or any Committee the Board may subsequently appoint to
administer the Plan. To the extent applicable, the Committee shall
be composed entirely of individuals who meet the qualifications
referred to in Section 162(m) of the Code and Rule 16b-3 under the
Securities Exchange Act of 1934, as amended.
2.7 "COMPANY" means Esterline Technologies Corporation, a Delaware
corporation (or any successor corporation), and its subsidiaries and
divisions.
2.8 "DISABILITY" means the inability of a Participant to perform
substantially his duties and responsibilities to the Company by
reason of a physical or mental disability or infirmity (i) for a
continuous period of six months or (ii) at such earlier time as the
Participant submits medical evidence satisfactory to the
Administrator that he has a physical or mental disability or
infirmity which will likely prevent him from returning to the
performance of his work duties for six months or longer. The date of
such Disability shall be the last day of such six-month period or
the day on which the Participant submits such satisfactory medical
evidence, as the case may be.
2.9 "DISINTERESTED PERSON" means a person who, at a given meeting of the
Committee or Board of Directors, is not being considered to receive
a grant of a Stock Option hereunder.
2.10 "EFFECTIVE DATE" shall mean the date set forth in Section 13.
2.11 "ELIGIBLE RECIPIENT" means selected officers (including officers
who are directors) and other key employees of the Company.
2.12 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
2.13 "FAIR MARKET VALUE" means, as of any given date, with respect to
any awards granted hereunder, (a) if the Stock is publicly traded,
the closing sale price of the Stock on such date as reported in the
Western Edition of the Wall Street Journal, or the average of the
closing
A-1
<PAGE>
price of the Stock on each day on which the Stock was traded over a
period of up to twenty trading days immediately prior to such date,
(b) the fair market value of the Stock as determined in accordance
with a method prescribed in the agreement evidencing any award
hereunder or (c) the fair market value of the Stock as otherwise
determined by the Administrator in the good faith exercise of its
discretion.
2.14 "OPTION" means any option to purchase shares of Stock granted
pursuant to Section 7.
2.15 "PARTICIPANT" means any Eligible Recipient selected by the
Administrator, pursuant to the Administrator's authority in Section
3 below, to receive grants of Stock Options.
2.16 "PERSON" shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d)
thereof, except that such term shall not include (i) the Company,
(ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company, (iii) an underwriter
temporarily holding securities pursuant to an offering of such
securities or (iv) a corporation owned, directly or indirectly, by
the shareholders of the Company in substantially the same
proportions as their ownership of stock of the Company.
2.17 "STOCK" means the common stock of the Company, par value $.20 per
share.
2.18 "SUBSIDIARY" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each
of the corporations (other than the last corporation) in the
unbroken chain owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the other
corporations in the chain.
3. ADMINISTRATION. The plan shall be administered in accordance with the
requirements of Section 162(m) of the Code (but only to the extent necessary to
maintain qualification of the Plan under Section 162(m) of the Code) and, to the
extent applicable, Rule 16b-3 under the Securities Exchange Act of 1934, as
amended ("Rule 16b-3") by the Board or by the Committee which shall be appointed
by the Board and which shall serve at the pleasure of the Board.
Pursuant to the terms of the Plan, the Administrator shall have the power
and authority to grant Options to Eligible Recipients. Directors of Esterline
who are either eligible to be granted Options or to whom Options have been
granted may vote on any matters affecting the administration of the Plan or the
granting of Options under the Plan; provided, however, that no Option may be
granted to a director under the Plan except by:
(i) The Committee, at a meeting at which a majority of its members are
Disinterested Persons; or
(ii) The Board of Directors at a meeting at which the majority of directors,
and a majority of the directors voting on a grant, are Disinterested
Persons.
In particular, the Administrator shall have the authority: (a) to select
those Eligible Recipients who shall be Participants; (b) to determine whether
and to what extent Options are to be granted hereunder to Participants; (c) to
determine the number of shares of Stock to be covered by each such Option
granted hereunder; (d) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any Option granted hereunder; and (e) to
determine the terms and conditions, not inconsistent with the terms of the Plan,
which shall govern all written instruments evidencing the Options granted
hereunder to Participants.
The Administrator shall have the authority, in its discretion, to adopt,
alter and repeal such administrative rules, guidelines and practices governing
the Plan as it shall from time to time deem advisable; to interpret the terms
and provisions of the Plan and any Option issued under the Plan (and any
agreements relating thereto); to waive compliance either generally or in any one
or more particular instances by an optionee with the requirements of any such
rule or regulation or any Option, subject to the provisions of the Plan and any
other applicable requirements; to decide all questions and settle all
A-2
<PAGE>
controversies and disputes which may arise in connection with the Plan; to
interpret the Plan and to make all other determinations deemed necessary or
advisable for the administration of the Plan; and to otherwise supervise the
administration of the Plan.
A majority of the members of the Committee shall constitute a quorum. All
decisions, interpretations and determinations made by the Administrator pursuant
to the provisions of the Plan shall be final and binding on all persons,
including the Company and the Participants. Any determination of the Committee
under the Plan may be made without notice or a meeting of the Committee by a
written consent signed by all of the Committee members.
4. SHARES SUBJECT TO THE PLAN. The total number of shares of Stock
reserved and available for issuance under the Plan shall be 400,000. Such shares
may consist, in whole or in part, of authorized and unissued shares or treasury
shares. Consistent with the provisions of Section 162(m) of the Code, as from
time to time applicable, to the extent that an Option expires or is otherwise
terminated without being exercised, such shares shall again be available for
issuance in connection with future awards under the Plan. During the term of the
Plan no individual may be granted Options to purchase more than 80% of the
shares of Stock reserved for issuance under the 1997 Plan.
5. ELIGIBILITY. Key employees of the Company (including officers and
directors who are employees) shall be eligible for selection by the Committee as
optionees under the Plan. In selecting the individuals to whom Options shall be
granted, as well as in determining the number of shares subject to each Option,
the Committee shall take into consideration the recommendations of the members
of the senior management of the Company and such factors as it shall deem
relevant in connection with accomplishing the purposes of the Plan. An
individual who has been granted an Option may, if he is otherwise eligible, be
granted an additional Option or Options.
6. LIMITATION ON GRANTING OF OPTIONS. No Option shall be granted under the
Plan more than ten (10) years after the date the plan becomes effective as
provided under Section 13.
7. TERMS AND CONDITIONS OF OPTIONS. All Options granted under the Plan
shall be subject to the following terms and conditions and to such other terms
and conditions as the Committee shall determine to be appropriate to accomplish
the purposes of the Plan:
(a) OPTION PRICE. The option price per share of Stock purchasable under
an Option shall be determined by the Administrator in its sole
discretion at the time of grant but shall not be less than 100% of
the Fair Market Value of the Stock on such date pursuant to paragraph
(b) below. The proceeds of sales of Stock subject to Options are to
be added to the general funds of the Company and used for such
corporate purposes as the Board may determine.
(b) TIME OF GRANTING OPTIONS. The date of grant of an Option under the
Plan shall, for all purposes, be the later of the date on which the
Committee makes the determination granting such Option or the
establishment of the Option price and no grant shall be deemed
effective under the Plan prior to such date. Notice of the
determination shall be given to each employee to whom an Option is so
granted within a reasonable time after the date of such grant.
(c) OPTION TERM. The term of each Option shall be fixed by the
Administrator, but no Option shall be exercisable more than ten years
after the date such Option is granted. In addition, and except as
provided in Section 8 hereof, an Option shall not be exercisable
unless the holder thereof shall, at the time of exercise, be an
employee of the Company or a subsidiary or an affiliate of the
Company.
(d) EXERCISABILITY. Options shall be exercisable at such time or times
and subject to such terms and conditions as shall be determined by
the Administrator at or after grant. The Administrator may provide,
in its discretion, that any Option shall be exercisable only in
installments, and the Administrator may waive such installment
exercise provisions at any time in whole or
A-3
<PAGE>
in part based on such factors as the Administrator may determine.
Notwithstanding the foregoing, the Options granted to each of the
Company's officers shall become 100% vested and exercisable as of the
day before the first to occur of the following events: (I) any Person
is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired directly
from the Company or its Affiliates other than in connection with the
acquisition by the Company or its Affiliates of a business)
representing 30% or more of the combined voting power of the
Company's then outstanding securities; or (II) the following
individuals cease for any reason to constitute a majority of the
number of directors then serving: individuals who, on the effective
date of the plan, constitute the Board of Directors of the Company
and any new director (other than a director whose initial assumption
of office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose
appointment or election by the Board of Directors of the Company or
nomination for election by the Company's shareholders was approved or
recommended by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors on the date hereof or
whose appointment, election or nomination for election was previously
so approved or recommended; or (III) the shareholders of the Company
approve a merger or consolidation of the Company or any direct or
indirect subsidiary of the Company with any other corporation, other
than (i) a merger or consolidation which would result in the voting
securities of the Company outstanding immmediately prior to such
merger or consolidation continuing to represent (either by remaining
outstanding or by being converted into voting securities of the
surviving entity or any parent thereof), in combination with the
ownership of any trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any Affiliate at least 70%
of the combined voting power of the securities of the Company or such
surviving entity or any parent thereof outstanding immediately after
such merger or consolidation, or (ii) a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (not including
in the securities Beneficially Owned by such Person any securities
acquired directly from the Company or its Affiliates other than in
connection with the acquisition by the Company or its Affiliates of a
business) representing 30% or more of the combined voting power of
the Company's then outstanding securities; or (IV) the shareholders
of the Company approve a plan of complete liquidation or dissolution
of the Company or there is consummated an agreement for the sale or
disposition by the Company of all or substantially all of the
Company's assets, other than a sale or disposition by the Company of
all or substantially all of the Company's assets to an entity, at
least 70% of the combined voting power of the voting securities of
which are owned by shareholders of the Company in substantially the
same proportions as their ownership of the Company immediately prior
to such sale. In addition, all Options granted hereunder shall become
100% vested and exercisable as of the day before approval by the
Board of Directors of a sale or other disposition which, when
aggregated with any other such sale(s) or disposition(s) occurring
within 12 months of such sale or disposition, relates to 30% or more
of the equity book value of the Company as measured as of the fiscal
month-end immediately preceding the first such sale or disposition.
(e) METHOD OF EXERCISE. Options may be exercised in whole or in part at
any time during the option period, by giving written notice of
exercise to the Company specifying the number of shares of Stock to
be purchased, accompanied by payment in full of the purchase price in
cash or its equivalent as determined by the Administrator. As
determined by the Administrator, in its sole discretion, payment in
whole or in part may also be made (i) by means of any
A-4
<PAGE>
cashless exercise procedure approved by the Administrator, or (ii) in
the form of shares of unrestricted Stock already owned by the
optionee.
The Administrator may require the voluntary surrender of all or a portion of
any Option granted under the Plan as a condition precedent to the grant of a new
Option. Subject to the provisions of the Plan, such new Option shall be
exercisable at the price, during such period and on such other terms and
conditions as are specified by the Administrator at the time the new Option is
granted.
8. EARLY TERMINATION OF OPTION. All Options granted which have not as yet
become exercisable shall terminate immediately upon termination of employment or
death. All exercisable Options that have not been exercised shall terminate as
follows:
(a) TERMINATION OF EMPLOYMENT. All rights to exercise an Option shall
terminate not more than three (3) months after the optionee's
employment terminates for any reason other than his death or
disability (within the meaning of the Company's long-term disability
plan). Transfer from one corporation within the Company to another
shall not be deemed termination of employment. The Committee shall
have the authority to determine in each case whether an authorized
leave of absence or absence on military or governmental service shall
be deemed a termination of employment for purposes of this
subsection.
(b) CORPORATE OFFICER RETIREMENT. In the event that a corporate officer
terminates his employment by reason of retirement, as determined by
eligibility for retirement under the Company's qualified retirement
plan, a vested option terminates on the earlier of three (3) years
following such termination of employment or the expiration date of
the Option.
(c) DEATH OF OPTIONEE. If any optionee dies while employed by the
Company, or within three (3) months thereafter, his Option shall
terminate at the time provided in his Option certificate for
termination in the event of death or, if the certificate contains no
such provision, his Option shall terminate three years after his
death (but in each instance not later than the date the Option would
otherwise expire). In the meantime, subject to the limitations on the
Option, it may be exercised by the executors or administrators of his
estate or by his legatees or heirs.
(d) DISABILITY. In the event of termination of an optionee's employment
as a result of disability within the meaning of paragraph (a) above,
an optionee's Option shall terminate three years after his employment
terminates (but in no event after the expiration of the Option
period).
9. NON-TRANSFERABILITY OF OPTIONS. No Option may be transferred by the
optionee otherwise than by will or by the laws of descent and distribution, and
during the optionee's lifetime the Option may be exercised only by him. More
particularly, but without limiting the generality of the foregoing, an Option
may not be assigned, transferred (except as provided in the next preceding
sentence), pledged, or hypothecated in any way (whether by operation of law or
otherwise), and will not be subject to execution, attachment or similar process.
Any attempted assignment, transfer, pledge, hypothecation or other disposition
of any Option contrary to the provisions of the Plan, and any levy of any
attachment or similar process upon an Option will be null and void and without
effect, and the Committee may, in its discretion, upon the happening of any such
event, terminate an Option forthwith.
10. PAYMENT FOR STOCK. Shares which are subject to an Option shall be
issued only upon receipt by the Company of full payment of the consideration for
the shares as to which the Option is exercised. The Company shall not be
obligated to deliver any shares unless and until, in the opinion of the
Company's counsel, all applicable federal and state laws and regulations have
been complied with, nor, if the outstanding Stock is at the time listed upon any
stock exchange, unless and until the shares to be delivered have been listed or
authorized to be added to the list upon official notice of issuance upon such
exchange, nor unless or until all other legal matters in connection with the
issuance and delivery of shares have been approved by the Company's counsel.
Without limiting the generality of the foregoing, the Company may
A-5
<PAGE>
require from the optionee such investment representation or such agreement, if
any, as counsel for the Company may consider necessary in order to comply with
the Securities Act of 1933 and may require that the optionee agree that any
sales of the shares will be made only in such manner as is permitted by the
Committee and that he will notify the Company when he makes any disposition of
the shares whether by sales, gift or otherwise. The Company shall use its best
efforts to effect any such compliance and listing, and the optionee shall take
any action reasonably requested by the Company in such connection. An optionee
shall generally have the rights to dividends and any other rights of a
shareholder with respect to the Stock subject to the Option only after the
optionee has given written notice of exercise and has paid in full for such
shares.
11. CHANGES IN STOCK. In the event of any merger, reorganization,
consolidation, recapitalization, stock dividend or other change in corporate
structure affecting the Stock, a substitution or adjustment shall be made in (i)
the kind and aggregate number of shares reserved for issuance under the Plan,
and (ii) the kind, number and option price of shares subject to outstanding
Options granted under the Plan. Such other substitutions or adjustments shall be
made as may be determined by the Administrator, in its sole discretion. In
connection with any event described in this Section 11, the Administrator may
provide, in its discretion, for the cancellation of any outstanding Options and
payment in cash or other property therefore.
12. EMPLOYMENT RIGHTS. Neither the adoption of the Plan nor the grant of
any Option under it shall confer upon any employee of the Company any right to
continued employment with the Company, nor shall either interfere in any way
with the right of the Company to terminate the employment of any of its
employees at any time, with or without cause. Neither the existence of the Plan
nor the grant of any Option hereunder shall be taken into account in determining
any damages to which an employee may be entitled upon termination of his
employment.
13. EFFECTIVE DATE, TERMINATION AND AMENDMENT OF THE PLAN.
(a) EFFECTIVE DATE OF THE PLAN. The Plan shall become effective upon its
approval by shareholders. The Plan shall be submitted for approval by
the shareholders of the Company at a meeting of shareholders duly
called and held no later than twelve months after the adoption of the
Plan by the Board.
(b) TERMINATION OR DISCONTINUANCE OF THE PLAN. The Plan shall terminate
ten years from the effective date. Prior thereto, the Board of
Directors may suspend or terminate the Plan or discontinue granting
Options under the Plan at any time; provided, however, that any such
suspension, termination or discontinuance shall not affect any
Options then outstanding under the Plan. No Options under the Plan
may be granted after termination of the Plan.
(c) AMENDMENT OF THE PLAN. The Board from time to time may make such
modifications or amendments of the Plan as it may deem advisable but
may not, without further approval of the shareholders of Esterline,
except as provided in Section 11 hereof (i) increase the maximum
number of shares which shall be available and reserved for issue
under the Plan, or (ii) change the class of persons eligible to
receive Options, or (iii) extend the term of the Plan beyond the
period provided in this Section. Notwithstanding the foregoing,
shareholder approval under this Section 13 shall only be required at
such time and under such circumstances as shareholder approval would
be required under Section 162(m) of the Code or other applicable law,
rule or regulation with respect to any material amendment to any
employee benefit plan of the Company.
(d) AMENDMENT OF OUTSTANDING OPTIONS. The Administrator may at any time
or times amend any outstanding Option or Options for the purpose of
satisfying the requirements of any changes in applicable laws or
regulations. Further, it may, with the consent of the holder of the
Option, make such modifications or amendments as it shall deem
advisable.
A-6
<PAGE>
(e) LIMITATION. Except as provided in Section 11, neither the
termination nor any modification or amendment of the Plan or any
outstanding Option shall, without the consent of the holder of an
Option theretofore granted under the Plan, adversely affect the
rights of such holder with respect to such Option or alter or impair
any Option previously granted under the Plan.
14. TERMINATION OF RIGHT OF ACTION. Every right of action arising out of
or in connection with the Plan by or on behalf of the Company, or by any
shareholder of the Company against any past, present or future member of the
Board or against any employee, or by an employee (past, present or future)
against the Company shall, irrespective of the place where an action may be
brought and irrespective of the place or residence of any such shareholder,
director or employee, cease and be barred by the expiration of three years from
the date of the act or omission in respect to which such right of action is
alleged to have arisen.
15. GENERAL PROVISIONS.
(a) OTHER AWARDS AND COMPENSATION. The Plan shall not restrict the
authority of the Board of the Company, acting directly or by
authorization to any committee, for proper corporate purposes, to
grant or assume stock options or replacements or substitutions
therefore, other than under the Plan, whether in connection with any
acquisition or otherwise, and with respect to any employee or other
person, or to award bonuses or other benefits to optionees under the
Plan in connection with exercises under the Plan (except with respect
to optionees who are or may become subject to Section 162(m) of the
Code) or otherwise, or to maintain or establish other compensation or
benefit plans or practices.
(b) STATUTORY REFERENCES, ETC. References to the provisions of statutes
and regulations in the Plan shall be deemed to refer to such
provisions as from time to time are in effect, unless the context
suggests otherwise.
(c) PAYMENT OF TAXES. Each Participant shall, no later than the date as
of which the value of an award first becomes includable in the gross
income of the Participant for Federal income tax purposes, pay to the
Company, or make arrangements satisfactory to the Administrator
regarding payment of, any Federal, state, or local taxes of any kind
required by law to be withheld with respect to the award. The
obligations of the Company under the Plan shall be conditional on the
making of such payments or arrangements, and the Company shall, to
the extent permitted by law, have the right to deduct any such taxes
from any payment of any kind otherwise due to the Participant.
(d) LIABILITY. No member of the Board or the Administrator, nor any
officer or employee of the Company acting on behalf of the Board or
the Administrator, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with
respect to the Plan, and all members of the Board or the
Administrator and each and any officer or employee of the company
acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company in respect of any such
action, determination or interpretation.
(e) UNFUNDED STATUS OF PLAN. The Plan is intended to constitute an
"unfunded" plan for incentive compensation. With respect to any
payments not yet made to a Participant by the Company, nothing
contained herein shall give any such Participant any rights that are
greater than those of a general creditor of the Company.
16. TERM OF THE PLAN. No Option shall be granted pursuant to the Plan on
or after the tenth anniversary of the effective date of the Plan, but awards
theretofore granted may extend beyond that date.
A-7
<PAGE>
ESTERLINE TECHNOLOGIES CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Wendell P. Hurlbut and Robert W. Stevenson
and each of them as proxies, each with full power of substitution, to
represent and vote for and on behalf of the undersigned, the number of shares
of common stock of Esterline Technologies Corporation that the undersigned
would be entitled to vote if personally present at the annual meeting of
shareholders to be held on March 5, 1997, or at any adjournment thereof. The
undersigned directs that this proxy be voted as follows:
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
- -------------------------------------------------------------------------------
--ARROW-- FOLD AND DETACH HERE --ARROW--
<PAGE>
/X/ PLEASE MARK YOUR VOTES
AS IN THIS EXAMPLE.
(1) Election of the following Nominees as Directors to serve a term of three
years:
Gilbert W. Anderson, Wendell P. Hurlbut, Malcolm T. Stamper.
FOR WITHHELD
/ / / /
INSTRUCTION: To withhold authority for any individual nominee, print that
nominee's name in the following space:
(2) Approval and adoption of the Company's 1997 Stock Option Plan.
FOR AGAINST ABSTAIN
/ / / / / /
(3) Ratification of Deloitte & Touche LLP as the Company's independent
auditors for fiscal year 1997.
/ / / / / /
(4) In their discretion, the holders of this proxy are authorized to vote
upon such other business as may properly come before the meeting or any
adjournment or postponement thereof.
FOR WITHHELD
/ / / /
This. proxy, when properly executed, will be voted in the manner directed on
this proxy card. Management recommends a vote FOR all nominees designated on
this proxy card and FOR each of the proposals referred to hereon; if no
specification is made, a vote FOR all of said nominees and FOR approval of
all of said proposals will be entered.
The undersigned hereby revokes any proxy or proxies heretofore given for such
shares and ratifies all that said proxies or their substitutes may lawfully
do by virtue hereof.
Signature(s)_________________________________________ Date________________
Please sign exactly as name appears on this proxy. If stock is held jointly,
each owner should sign. Persons signing in a representative capacity should
give their title.
PLEASE PROMPTLY DATE, SIGN AND RETURN THIS PROXY CARD.
- -------------------------------------------------------------------------------
--ARROW-- FOLD AND DETACH HERE --ARROW--
