<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
AMPCO Pittsburgh
- --------------------------------------------------------------------------------
(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):
[_] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] 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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[LOGO OF AMPCO PITTSBURGH]
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, APRIL 24, 1997
To the Shareholders of
Ampco-Pittsburgh Corporation
Notice is hereby given that the Annual Meeting of the Shareholders of Ampco-
Pittsburgh Corporation will be held in The Conference Room, 33rd Floor, USX
Tower, Pittsburgh, Pennsylvania, on Thursday, April 24, 1997 at 10:00 a.m.,
for the following purposes:
1. To elect a class of two Directors for a term that expires in 2000.
2. To act upon a proposal to approve the adoption of the Ampco-Pittsburgh
Corporation 1997 Stock Option Plan.
3. To transact such other business as may properly come before the meeting
and any adjournment thereof.
Shareholders of record on March 6, 1997 are entitled to notice of and to
vote at the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Rose Hoover, Secretary
Pittsburgh, Pennsylvania
March 14, 1997
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON. YOUR
VOTE IS IMPORTANT AND, WHETHER OR NOT YOU EXPECT TO ATTEND IN PERSON, IT IS
REQUESTED THAT YOU PROMPTLY FILL IN, SIGN, AND RETURN THE ENCLOSED PROXY CARD.
<PAGE>
[LOGO OF AMPCO PITTSBURGH]
PROXY STATEMENT
MARCH 14, 1997
ANNUAL MEETING OF SHAREHOLDERS APRIL 24, 1997
SOLICITATION OF PROXIES
This Statement is furnished in connection with the solicitation of proxies
to be used at the Annual Meeting of Shareholders of AMPCO-PITTSBURGH
CORPORATION (the "Corporation") to be held on April 24, 1997. The first
mailing of the proxy material to the shareholders is expected to be made on
March 14, 1997.
The accompanying proxy is solicited on behalf of the Board of Directors of
the Corporation. In addition to the solicitation of proxies by use of the
mails, proxies may be solicited by Directors and employees, in person or by
telephone, and brokers and nominees may be requested to send proxy material to
and obtain proxies from their principals. The Corporation will pay the costs
incurred for those solicitations of proxies and will pay Kissel-Blake Inc.,
110 Wall Street, New York, New York, a fee of $6,000, plus reimbursement of
reasonable out-of-pocket expenses, for aid in the solicitation of proxies.
Any shareholder has the power to revoke the proxy at any time prior to the
voting thereof. Revocation of the proxy will not be effective until notice
thereof has been given to the Secretary of the Corporation or until a duly
executed proxy bearing a later date is presented.
VOTING SECURITIES AND RECORD DATE
Only holders of record of Common Stock of the Corporation at the close of
business on March 6, 1997, will be entitled to vote at the meeting. On that
date, there were 9,577,621 shares of Common Stock outstanding. The holders of
those shares are entitled to one vote per share. In the election of Directors,
the shares may be voted cumulatively. Cumulative voting means that the number
of shares owned by each shareholder may be multiplied by the number of
Directors to be elected and that total voted for the nominees in any
proportion. Shares that are not voted cumulatively are voted on a one vote per
share basis for each nominee, except for those nominees, if any, for whom the
shareholder is withholding authority to vote.
REQUIRED VOTE
Under Pennsylvania law and the Corporation's by-laws, the presence of a
quorum is required to transact business at the 1997 Annual Meeting of
Shareholders. A quorum is defined as the presence, either in person or by
proxy, of a majority of the votes that all shareholders are entitled to cast
at the meeting. Abstentions, votes withheld from director nominees, and
broker-dealer non-votes will be counted for purposes of determining a quorum.
Assuming the presence of a quorum, (i) the two nominees for director
receiving the highest number of votes will be elected directors and (ii) the
affirmative vote of a majority of the common shares casting a vote, either in
person or by proxy, is required to approve the Ampco-Pittsburgh Corporation
1997 Stock Option Plan ("Stock Option Plan"), provided that at least 50% of
the shares entitled to vote on the Stock Option Plan proposal cast votes on
such proposal. For purposes of the Stock Option Plan proposal, abstentions are
not considered as votes cast under Pennsylvania law.
1
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ELECTION OF DIRECTORS
A class of two Directors will be elected for a term of three years to fill
the class of Directors whose term expires in 1997. Both nominees for election
to the Board of Directors are currently Directors and were originally elected
by the shareholders. Both of the nominees were nominated by the Board of
Directors at its February 20, 1997 meeting and are willing to serve as
Directors if elected. If at the time of the Annual Meeting either nominee
should be unable or unwilling to stand for election, the proxies will be voted
for the election of such person, if any, as may be selected by the Board of
Directors to replace him.
The Board of Directors has no nominating committee. Under the Corporation's
By-laws, a shareholder may make nominations for Directors, but only in the
period that is not less than sixty (60) or more than ninety (90) days in
advance of the anniversary date of the previous year's annual meeting.
Proxies in the enclosed form will be voted, unless otherwise directed, for
the following nominees, each of whom was most recently elected by the
shareholders in 1994:
NOMINEES FOR DIRECTORS FOR A TERM OF OFFICE EXPIRING IN 2000:
William D. Eberle (age 73, Director since 1982). He is a private investor and
consultant and is Chairman of Manchester Associates, Ltd. He is also a
director of Mitchell Energy & Development Co., America Service Group,
Fibreboard Corporation, Barry's Jewelers, Inc., Mid-States PLC, Showscan
Entertainment, Inc. and Sirrom Capital Corporation.
Robert A. Paul (age 59, Director since 1970). He has been President and Chief
Executive Officer of the Corporation since September 20, 1994. For more than
five years before 1994, he was President and Chief Operating Officer of the
Corporation. He is also an officer and director of The Louis Berkman Company
and a director of National City Corporation.
DIRECTORS WHOSE TERM OF OFFICE EXPIRES IN 1998:
Alvin G. Keller (age 87, Director since 1961). He is a private investor who,
prior to his retirement, served as a Vice President of Mellon Bank, N.A.
Ernest G. Siddons (age 63, Director since 1981). He has been Executive Vice
President and Chief Operating Officer of the Corporation since September 20,
1994. For more than five years before 1994, he was Senior Vice President
Finance and Treasurer of the Corporation. Since September, 1996, he has been
President of Union Electric Steel Corporation, a subsidiary of the
Corporation.
DIRECTORS WHOSE TERM OF OFFICE EXPIRES IN 1999:
Louis Berkman (age 88, Director since 1960). He has been Chairman of the Board
of the Corporation since September 20, 1994. He is also Chairman of the
Executive Committee of the Corporation and has been for more than five years.
He is also President and a director of The Louis Berkman Company (steel
products, fabricated metal products, building and industrial supplies).
Carl H. Pforzheimer, III (age 60, Director since 1982). For more than five
years he has been Managing Partner of Carl H. Pforzheimer & Co. (member of the
New York and American Stock Exchanges).
Leonard M. Carroll (age 54, Director since 1996). He has been Managing
Director of Seneca Capital Management, Inc. (a private investment company)
since June, 1996. For more than five years before 1996, he was President and
Chief Operating Officer of Integra Financial Corporation (a bank holding
company). He is also a director of Quaker State Corporation.
The Board of Directors held five meetings in 1996. The Executive Committee
of the Board of Directors held two meetings in 1996 and took action twice by
written consent. The Executive Committee is comprised of four Directors: Louis
Berkman, Robert A. Paul, Ernest G. Siddons and Alvin G. Keller. The Salary
Committee is comprised of William D. Eberle, Chairman, Louis Berkman and Alvin
G. Keller. The 1996 Salary Committee meeting was held in January, 1997. In
1996 all of the Directors attended more than 75% of the applicable
2
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meetings. In 1996, each Director who was not employed by the Corporation
received $2,000 for each Board meeting attended and $500 for each Committee
meeting attended. Directors received one-half of those amounts if not in
attendance or if participation was by telephonic connection.
Louis Berkman is the father-in-law of Robert A. Paul. There are no other
family relationships among the Directors and Officers.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT INCLUDING
NOMINEES
As of March 6, 1997, Louis Berkman owned directly 213,888 shares (2.23%) of
the Common Stock of the Corporation. As of the same date, The Louis Berkman
Company, P.O. Box 576, Steubenville, Ohio, 43952, owned beneficially and of
record 2,126,089 shares (22.2%) of the Common Stock of the Corporation. Louis
Berkman, an officer and director of The Louis Berkman Company, owns directly
62.90% of its common stock. Robert A. Paul, an officer and director of The
Louis Berkman Company, disclaims beneficial ownership of the 18.93% of its
common stock owned by his wife. Louis Berkman and Robert A. Paul are trustees
of The Louis and Sandra Berkman Foundation and disclaim beneficial ownership
of the 1,266 shares of the Corporation's Common Stock held by such Foundation.
The Corporation has received three Schedules 13G filed with the Securities
and Exchange Commission disclosing that as of December 31, 1996 Dimensional
Fund Advisors Inc., 1299 Ocean Avenue, 11th Floor, Santa Monica, CA 90401
owned 603,700 shares or 6.3% (all of which shares are held in portfolios of
various investment vehicles for qualified employee benefit plans of which
Dimensional Fund Advisors serves as investment manager); that Long Term
Investment Trust (F.K.A. AT&T Master Pension Trust), through The Northern
Trust Company, as Trustee of the Long Term Investment Trust, 50 S. LaSalle
Street, Chicago, IL 60675, owned 667,400 shares or 6.97%; and that Norwest
Corporation, Sixth & Marquette, Minneapolis, MN 55479 (in various fiduciary
and agency capacities and including the Long Term Investment Trust shares
described above) owned 1,083,716 shares or 11.3%. On November 11, 1996,
Gabelli Funds, Inc. and affiliates, Corporate Center, Rye, NY 10580, filed an
amendment to its Schedule 13D showing they owned 1,799,700 shares or 18.79%.
The following table sets forth as of March 6, 1997 information concerning
the beneficial ownership of the Corporation's Common Stock by the Directors
and Named Executive Officers and all Directors and Executive Officers of the
Corporation as a group:
<TABLE>
<CAPTION>
NAME OF AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
---------------- -------------------- --------
<S> <C> <C>
Louis Berkman 2,341,243(1)(2) 24.4
Robert A. Paul (N) 57,922(2)(3) .6
Alvin G. Keller 9,753(4) .1
Carl H. Pforzheimer, III 2,733(5) *
Ernest G. Siddons 1,833(6) *
Leonard M. Carroll 1,000 *
William D. Eberle (N) 200 *
Robert F. Schultz 200(6) *
Directors and Executive Officers
as a group (10 persons) 2,413,618(7) 25.2
</TABLE>
- --------
(N) Nominee for Director
* less than .1%
(1) Includes 213,888 shares owned directly, 2,126,089 shares owned by The
Louis Berkman Company and 1,266 shares held by The Louis and Sandra
Berkman Foundation, of which Louis Berkman and Robert A. Paul are
Trustees, in which shares Mr. Berkman disclaims beneficial ownership.
(2) The Louis Berkman Company owns beneficially and of record 2,126,089 shares
of the Corporation's Common Stock (22.2%). Louis Berkman is an officer and
director of The Louis Berkman Company and
3
<PAGE>
owns directly 62.90% of its common shares. Robert A. Paul, an officer and
director of The Louis Berkman Company, disclaims beneficial ownership of the
18.93% of its common stock owned by his wife. The number of shares shown in
the table for Robert A. Paul does not include any shares held by The Louis
Berkman Company.
(3) Includes 42,889 shares owned directly and the following shares in which he
disclaims beneficial ownership: 13,767 shares owned by his wife and 1,266
shares held by The Louis and Sandra Berkman Foundation, of which Robert A.
Paul and Louis Berkman are Trustees.
(4) Includes 5,333 shares owned directly, 3,000 shares owned jointly with his
wife, and 1,420 shares owned by his wife, in which shares he disclaims
beneficial ownership.
(5) Includes 1,000 shares owned directly, 1,600 shares held by a trust of which
he is a trustee and principal beneficiary, and 133 shares held by his
daughter, in which shares he disclaims beneficial ownership.
(6) The shares are owned jointly with his wife.
(7) Excludes double counting of shares deemed to be beneficially owned by more
than one Director.
Unless otherwise indicated the individuals named have sole investment and
voting power.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Leonard M. Carroll was elected as a director by the Board of Directors in
July, 1996. His initial filing on Form 3 under Section 16 of the Securities
Exchange Act, which was filed in August, 1996, was not filed on a timely basis.
At that time, Mr. Carroll owned no shares of the Corporation's Common Stock. He
subsequently acquired 1000 shares and filed a timely Form 4.
EXECUTIVE COMPENSATION
The following table sets forth certain information as to the total
remuneration received for the past three years by the four most highly
compensated executive officers of the Corporation, including the Chief
Executive Officer (the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
- ------------------------------------------------------------------------------
(A) (B) (C) (D) (I)
ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) COMPENSATION ($)
--------------------------- ---- ---------- --------- ----------------
<S> <C> <C> <C> <C>
Louis Berkman 1996 290,000 67,000
Chairman of the Board and 1995 250,000 42,500
Executive Committee 1994 118,750 15,000
Robert A. Paul 1996 290,000 67,000
President and Chief 1995 250,000 42,500
Executive Officer 1994 236,500 15,000
Ernest G. Siddons 1996 260,000 60,000 5,520(1)
Executive Vice President 1995 225,000 38,250 5,064(1)
and Chief Operating 1994 216,750 13,500 4,359(1)
Officer
Robert F. Schultz 1996 130,875 16,500
Vice President 1995 127,500 12,500
Industrial Relations 1994 122,500 7,500
and Senior Counsel
</TABLE>
- --------
(1) Value of the term portion of a split dollar life insurance policy. The
Corporation remains entitled to the cash surrender value of such policy.
4
<PAGE>
The Corporation has a tax qualified retirement plan (the "Plan") applicable
to the Executive Officers, to which the Corporation makes annual
contributions, as required, in amounts determined by the Plan's actuaries. The
Plan does not have an offset for Social Security and is fully paid for by the
Corporation. Under the Plan, employees become fully vested after five years of
participation and normal retirement age under the Plan is age 65 but
actuarially reduced benefits may be available as early as age 55. The benefit
formula is 1.1% of the highest consecutive five year average earnings in the
final ten years, times years of service. Federal law requires that any active
employee start receiving a pension no later than April 1 following the
calendar year in which the age 70 1/2 is reached. Louis Berkman is currently
receiving $3,754 a month pursuant to the Plan. As an active employee, Mr.
Berkman continues to receive credit for additional service rendered after age
70 1/2.
The Corporation adopted a Supplemental Executive Retirement Plan (SERP) in
1988, amended and restated in 1996, for all officers listed in the
compensation table, except Louis Berkman, and a certain key employee, covering
retirement after completion of ten years of service and attainment of age 55.
The combined retirement benefit at age 65 provided by the Plan and the SERP is
50% of the highest consecutive five year average earnings in the final ten
years of service. The participants are eligible for reduced benefits for early
retirement at age 55. A benefit equal to 50% of the benefit otherwise payable
at age 65 is paid to the surviving spouse of any participant, who has had at
least five years of service, commencing on the later of the month following
the participant's death or the month the participant would have reached age
55. In addition, there is an offset for pensions from other companies. Certain
provisions, applicable if there is a change of control, are discussed below
under Termination of Employment and Change of Control Arrangement.
The following shows the estimated annual pension under the Plan and SERP
that would be payable, without offset, to the individuals named in the
compensation table assuming continued employment to retirement at age 65, but
no change in the level of compensation shown in such table:
<TABLE>
<S> <C>
Louis Berkman (1)
Robert A. Paul $178,500
Ernest G. Siddons $154,325
Robert F. Schultz $73,688
</TABLE>
- --------
(1) Mr. Berkman is currently receiving a pension pursuant to the Plan as
described above.
TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS
The Chairman, President, and Executive Vice President have two year
contracts (which automatically renew for one year periods unless the
Corporation chooses not to extend) providing for compensation equal to five
times their annual compensation (with a provision to gross up to cover the
cost of any federal excise tax on the benefits) in the event their employment
is terminated (including a voluntary departure for good cause) and the right
to equivalent office space and secretarial help for a period of one year after
a change in control. In addition, the remaining officer named in the
compensation table and a certain key employee have two year contracts
providing for three times their annual compensation in the event their
employment is terminated after a change in control (including a voluntary
departure for good cause). Both types of contracts provide for the
continuation of employee benefits, for three years for the three senior
executives and two years for the others, and the right to purchase the leased
car used by the covered individual at the Corporation's then book value. The
same provisions concerning change in control that apply to the contracts apply
to the SERP and vest the right to that pension arrangement. A change of
control triggers the right to a lump sum payment equal to the present value of
the vested benefit under the SERP.
SALARY COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
A Salary Committee is appointed each year by the Board of Directors.
Committee members abstain from voting on matters which involve their own
compensation arrangements. The Salary Committee for the year 1996 was
comprised of three Directors: William D. Eberle, Chairman, Louis Berkman and
Alvin G. Keller.
5
<PAGE>
Louis Berkman is Chairman of the Board of Directors and Chairman of the
Executive Committee. He is also the President and a director of The Louis
Berkman Company. The Corporation's President and Chief Executive Officer,
Robert A. Paul, is also an officer and director of The Louis Berkman Company.
The Louis Berkman Company and William D. Eberle had certain transactions
with the Corporation, which are more fully described under "Certain
Relationships and Related Transactions."
SALARY COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Salary Committee approves salaries for executive officers within a range
from $150,000 up to $200,000 and increases in the salary of any executive
officers which would result in such officer earning a salary within such
range. Salaries of $200,000 per year and above must be approved by the Board
of Directors after a recommendation by the Salary Committee. Salaries for
executive officers below the level of $150,000 are set by the Chairman,
President and Executive Vice President of the Corporation.
The compensation of the Chief Executive Officer of the Corporation, as well
as the other applicable executive officers, is based on an analysis conducted
by the Salary Committee. The Committee does not specifically link remuneration
solely to quantitative measures of performance because of the cyclical nature
of the industries and markets served by the Corporation. In setting
compensation, the Committee also considers various qualitative factors,
including competitive compensation arrangements of other companies within
relevant industries, individual contributions, leadership ability and an
executive officer's overall performance. In this way, it is believed that the
Corporation will attract and retain quality management, thereby benefiting the
long-term interest of shareholders.
In December 1995, the Salary Committee reviewed and approved salary
increases and an incentive program for 1996 covering Louis Berkman, Robert A.
Paul and Ernest G. Siddons ("participants"). Incentive payments were to be
determined by formula, based exclusively on the Corporation's 1996 income from
operations performance as compared to the Corporation's business plan. These
payments were to be limited to 30% of base salary of participants. In 1996 the
Corporation exceeded the business plan and as a result the participants earned
incentives of $67,000, $67,000 and $60,000, respectively.
This report of the Salary Committee shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that the Corporation
specifically incorporates this report and the information contained herein by
reference, and shall not otherwise be deemed filed under such Acts.
Louis Berkman
William D. Eberle
Alvin G. Keller
6
<PAGE>
Comparative Five-Year Total Returns*
Ampco-Pittsburgh Corporation, Standard & Poors 500 and Value Line
Metals/Steel/Intg. Index
(Performance results through 12/31/96)
[GRAPH APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG AMPCO-PITTSBURGH, S&P 500 INDEX AND METALS/STEEL/INTG. INDEX
<TABLE>
<CAPTION>
Measurement period S&P 500 Metals/Steel/Intg.
(Fiscal year covered) AMPCO-Pittsburgh Index Index
- --------------------- ---------------- ------- ------------------
<S> <C> <C> <C>
Measurement PT-12/31/91 $100 $100 $100
FYE 12/31/92 121.12 107.79 116.84
FYE 12/31/93 98.10 118.66 159.64
FYE 12/31/94 137.69 120.56 142.72
FYE 12/31/95 151.51 165.78 115.70
FYE 12/31/96 171.40 204.32 102.55
</TABLE>
Assumes $100 invested at the close of trading on the last trading day
preceding January 1 of the fifth preceding fiscal year in AP common stock, S&P
500, and Peer Group.
*Cumulative total return assumes reinvestment of dividends.
In the above graph, the Corporation has used Value Line's Metals: Steel,
Integrated Industry for its peer comparison. The diversity of products
produced by subsidiaries of the Corporation made it difficult to match to any
one product-based peer group. The Steel Industry was chosen because it is
impacted by some of the same end markets that the Corporation ultimately
serves, such as the automotive, appliance and construction industries.
Historical stock price performance shown on the above graph is not
necessarily indicative of future price performance.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In 1996 the Corporation bought industrial supplies from The Louis Berkman
Company in transactions in the ordinary course of business amounting to
approximately $1,440,915. Additionally, The Louis Berkman Company paid the
Corporation $155,000 for certain administrative services. Louis Berkman and
Robert A. Paul are officers and directors, and Louis Berkman is a shareholder,
in that company. These transactions and services were at prices generally
available from outside sources. Transactions between the parties will take
place in 1997.
In 1989, certain subsidiaries of the Corporation and Tertiary, Inc., a
corporation owned by the children of William Eberle, formed three 50/50
partnerships, to manage, develop and operate hotel properties and a subsidiary
of the Corporation also invested as a limited partner in one of the operating
partnerships. In 1992, Tertiary purchased the Corporation's interest in two of
the 50/50 partnerships. At December 31, 1996, there were promissory notes
outstanding from certain of the partnerships to subsidiaries of the
Corporation totalling $635,000. These notes are due in 1998.
7
<PAGE>
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
At the February 20, 1997 meeting of the Board of Directors and upon the
recommendation of the Audit Committee, Price Waterhouse LLP was selected as
the Corporation's independent accountants for the year 1997. Representatives
of that firm will be in attendance at the Annual Meeting, will have the
opportunity to make a statement if they wish to do so, and will respond to
appropriate questions.
The Audit Committee held two meetings in 1996 and was comprised of four
Directors: William P. Hackney (a former director), Alvin G. Keller, Carl H.
Pforzheimer, III, and William D. Eberle. None of the Committee members is now,
or has within the past five years been, an employee of the Corporation. The
Audit Committee reviews the Corporation's accounting and reporting practices,
including internal control procedures, and maintains a direct line of
communication with the Directors and the independent accountants.
APPROVAL OF ADOPTION OF THE 1997 STOCK OPTION PLAN
In February, 1997, the Board of Directors of the Corporation (the "Board")
adopted, subject to shareholder approval, the Ampco-Pittsburgh Corporation
1997 Stock Option Plan (the "Stock Option Plan"). The following is a summary
of the material features of the Stock Option Plan, a copy of which is appended
hereto.
PURPOSES:
The purposes of the Stock Option Plan are to promote the interests of the
Corporation and its shareholders by (i) attracting and retaining exceptional
officers and other key employees of the Corporation and its subsidiaries and
(ii) enabling such individuals to participate in the long-term growth and
financial success of the Corporation.
ADMINISTRATION/ELIGIBLE PARTICIPANTS:
The Stock Option Plan is administered by the Salary Committee of the Board
of Directors, or such other committee of the Board of Directors as may be
designated by the Board of Directors to administer the Stock Option Plan (the
"Committee").
Any officer or other key employee of the Corporation or any of its
subsidiaries shall be eligible to be designated a participant under the Stock
Option Plan (each a "Participant").
As of December 31, 1996, the Corporation and its subsidiaries had
approximately 40 officers and key employees, each of whom is eligible to be
granted awards by the Committee under the Stock Option Plan. The Committee has
the sole and complete authority to determine the Participants to whom awards
shall be granted under the Stock Option Plan.
NUMBER OF SHARES AUTHORIZED UNDER THE STOCK OPTION PLAN:
The Stock Option Plan authorizes the grant of awards to Participants with
respect to a maximum of 300,000 shares of the Corporation's common stock
("Shares"), which awards may be made in the form of (i) nonqualified stock
options or (ii) stock options intended to qualify as incentive stock options
under section 422 of the Internal Revenue Code of 1986, as amended; provided
that the maximum number of Shares with respect to which stock options may be
granted to any Participant in the Stock Option Plan in any fiscal year may not
exceed 150,000. If, after the effective date of the Stock Option Plan, any
Shares covered by an award granted under the Stock Option Plan, or to which
such an award relates, are forfeited, or if an award has expired, terminated
or been canceled for any reason whatsoever (other than by reason of exercise
or vesting), then the Shares covered by such award shall again be, or shall
become, Shares with respect to which awards may be granted under the Stock
Option Plan.
8
<PAGE>
SUBSTITUTE AWARDS
Awards may be made under the Stock Option Plan in assumption of, or in
substitution for, outstanding awards previously granted by the Corporation or
its affiliates or a company acquired by the Corporation or with which the
Corporation combines. The number of shares underlying any such assumed or
substitute awards shall be counted against the aggregate number of Shares
which are available for grant under awards made under the Stock Option Plan.
TERMS AND CONDITIONS OF AWARDS UNDER THE STOCK OPTION PLAN
Non-qualified and incentive stock options granted under the Stock Option
Plan shall be subject to such terms, including exercise price and conditions
and timing of exercise, as may be determined by the Committee and specified in
the applicable award agreement or thereafter; provided that stock options that
are intended to qualify as incentive stock options will be subject to terms
and conditions that comply with such rules as may be prescribed by section 422
of the Code. Payment in respect of the exercise of an option granted under the
Stock Option Plan may be made in cash, or its equivalent, or (i) by exchanging
Shares owned by the optionee (which are not the subject of any pledge or other
security interest and which have been owned by such optionee for at least six
months) or (ii) subject to such rules as may be established by the Committee,
through delivery of irrevocable instructions to a broker to sell the shares
being acquired upon exercise of the option and to deliver promptly to the
Corporation an amount equal to the aggregate exercise price, or by a
combination of the foregoing, provided that the combined value of all cash and
cash equivalents and the fair market value of such Shares so tendered to the
Corporation as of the date of such tender is at least equal to the aggregate
exercise price of the option. No Award shall be granted under the Plan after
December 21, 2007.
ADJUSTMENTS
In the event that the Committee determines that any corporate transaction or
event affects the Shares such that an adjustment is determined by the
Committee in its discretion to be appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made
available under the Stock Option Plan, then the Committee shall, in such
manner as it may deem equitable, adjust any or all of (i) the number of Shares
or other securities of the Corporation (or number and kind of other securities
or property) with respect to which awards may be granted, (ii) the number of
Shares or other securities of the Corporation (or number and kind of other
securities or property) subject to outstanding awards, and (iii) the exercise
price with respect to any award or, if deemed appropriate, make provision for
a cash payment to the holder of an outstanding award in consideration for the
cancellation of such award.
TRANSFERABILITY
Each award, and each right under any award, shall be exercisable only by the
Participant during the Participant's lifetime, or, if permissible under
applicable law, by the Participant's guardian or legal representative.
Except as otherwise provided in an applicable award agreement, no award may
be assigned, alienated, pledged, attached, sold or otherwise transferred or
encumbered by a Participant otherwise than by will or by the laws of descent
and distribution and any such purported assignment, alienation, pledge,
attachment, sale, transfer or encumbrance shall be void and unenforceable
against the Corporation or any affiliate; provided that the designation of a
beneficiary shall not constitute an assignment, alienation, pledge,
attachment, sale, transfer or encumbrance.
CHANGE OF CONTROL
In the event of a change of control (as defined in the Stock Option Plan),
any outstanding awards then held by Participants which are unexercisable or
otherwise unvested shall automatically be deemed exercisable or otherwise
vested, as the case may be, as of immediately prior to such change of control.
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AMENDMENT TO STOCK OPTION PLAN
The Board may amend, alter, suspend, discontinue or terminate the Stock
Option Plan or any portion thereof at any time; provided that no such
amendment, alteration, suspension, discontinuation or termination shall be
made without shareholder approval if such approval is necessary to comply with
any tax or regulatory requirement applicable to the Plan and provided further
than any such amendment, alteration, suspension, discontinuance or termination
that would impair the rights of any holder or beneficiary of an award
theretofore granted shall not to that extent be effective without the consent
of the affected person.
FEDERAL INCOME TAX CONSEQUENCES RELATING TO STOCK OPTIONS
The following summary of the Federal income tax consequences of the grant
and exercise of nonqualified and incentive stock options awarded under the
Stock Option Plan, and the disposition of Shares purchased pursuant to the
exercise of such stock options, is intended to reflect the current provisions
of the Code and the regulations thereunder. This summary is not intended to be
a complete statement of applicable law, nor does it address state and local
tax considerations.
No income will be realized by an optionee upon grant of a nonqualified stock
option. Upon exercise of a nonqualified stock option, the optionee will
recognize ordinary compensation income in an amount equal to the excess, if
any, of the fair market value of the underlying stock over the option exercise
price (the "Spread") at the time of exercise. The Spread will be deductible by
the Corporation for federal income tax purposes subject to the possible
limitations on deductibility under sections 280G and 162(m) of the Code of
compensation paid to executives designated in those sections. The optionee's
tax basis in the underlying shares acquired by exercise of a nonqualified
stock option will equal the exercise price plus the amount taxable as
compensation to the optionee. Upon sale of the shares received by the optionee
upon exercise of the nonqualified stock option, any gain or loss is generally
long-term or short-term capital gain or loss, depending on the holding period.
The optionee's holding period for shares acquired pursuant to the exercise of
a nonqualified stock option will begin on the date of exercise of such option.
Pursuant to currently applicable rules under Section 16(b) of the Exchange
Act of 1934, as amended ("Exchange Act"), the grant of an option (and not its
exercise) to a person who is subject to the reporting and short-swing profit
provisions under section 16 of the Exchange Act (a "Section 16 Person") begins
the six-month period of potential short-swing liability. The taxable event for
the exercise of an option that has been outstanding at least six months
ordinarily will be the date of exercise. If an option is exercised by a
Section 16 Person within six months after the date of grant, however, taxation
ordinarily will be deferred until the date which is six months after the date
of grant, unless the person has filed a timely election pursuant to section
83(b) of the Code to be taxed on the date of exercise. Pursuant to a recent
amendment to the rules under Section 16(b) of the Exchange Act, the six month
period of potential short-swing liability may be eliminated if the option
grant (i) is approved in advance by the Corporation's board of directors (or a
committee composed solely of two or more non-employee directors) or (ii)
approved in advance by the Corporation's shareholders, or subsequently
ratified by the Corporation's shareholders no later than the next annual
meeting of shareholders. If the conditions described in clauses (i) or (ii)
above are satisfied with respect to awards made under the Stock Option Plan,
the taxable event for the exercise of an option that satisfies such conditions
will be the date of exercise.
The payment by an optionee of the exercise price, in full or in part, with
previously acquired Shares will not affect the tax treatment of the exercise
described above. No gain or loss generally will be recognized by the optionee
upon the surrender of the previously acquired Shares to the Corporation, and
Shares received by the optionee, equal in number to the previously surrendered
Shares, will have the same tax basis as the Shares surrendered to the
Corporation and will have a holding period that includes the holding period of
the Shares surrendered. The value of Shares received by the optionee in excess
of the number of Shares surrendered to the Corporation will be taxable to the
optionee. Such additional Shares will have a tax basis equal to the fair
market value of such additional Shares as of the date ordinary income is
recognized, and will have a holding period that begins on the date ordinary
income is recognized.
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The Code requires that, for incentive stock option treatment, Shares
acquired through exercise of an incentive stock option cannot be disposed of
before two years from the date of grant and one year from the date of
exercise. Incentive stock option holders will generally incur no federal
income tax liability at the time of grant or upon exercise of such options.
However, the Spread will be an "item of tax preference", which may give rise
to "alternative minimum tax" liability at the time of exercise. If the
optionee does not dispose of the Shares before two years from the date of
grant and one year from the date of exercise, the difference between the
exercise price and the amount realized upon disposition of the Shares will
constitute long-term capital gain or loss, as the case may be. Assuming both
the holding periods are satisfied, no deduction will be allowable to the
Corporation for federal income tax purposes in connection with the grant or
exercise of the option. If, within two years of the date of grant or within
one year from the date of exercise, the holder of shares acquired through the
exercise of an incentive stock option disposes of such Shares, the optionee
will generally realize ordinary taxable compensation at the time of such
disposition equal to the difference between the exercise price and the lesser
of the fair market value of the stock on the date of initial exercise or the
amount realized on the subsequent disposition, and such amount will generally
be deductible by the Corporation for federal income tax purposes, subject to
the possible limitations on deductibility under sections 280G and 162(m) of
the Code for compensation paid to executives designated in those sections.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF THE
ADOPTION OF THE 1997 STOCK OPTION PLAN.
SHAREHOLDER PROPOSALS FOR 1998
Any shareholder who wishes to place a proposal before the next Annual
Meeting of Shareholders must submit the proposal to the Corporation's
Secretary, at its executive offices, no later than November 14, 1997 to have
it considered for inclusion in the proxy statement for the Annual Meeting in
1998.
OTHER MATTERS
The Board of Directors does not know of any other business that will be
presented for action at the Meeting. Should any other matter come before the
Meeting, however, action may be taken thereon pursuant to proxies in the form
enclosed unless discretionary authority is withheld.
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EXHIBIT A
AMPCO-PITTSBURGH CORPORATION
1997 STOCK OPTION PLAN
Section 1. Purpose. The purposes of this Ampco-Pittsburgh Corporation 1997
Stock Option Plan are to promote the interests of Ampco-Pittsburgh Corporation
and its shareholders by (i) attracting and retaining exceptional officers and
other key employees of the Corporation and its Subsidiaries and (ii) enabling
such individuals to participate in the long-term growth and financial success
of the Corporation.
Section 2. Definitions. As used in the Plan, the following terms shall have
the meanings set forth below:
"Affiliate" shall mean (i) any entity that, directly or indirectly, is
controlled by, controls or is under common control with, the Corporation and
(ii) any entity in which the Corporation has a significant equity interest, in
either case as determined by the Committee.
"Award" shall mean any Option Award.
"Award Agreement" shall mean any written agreement, contract, or other
instrument or document evidencing any Award, which may, but need not, be
executed or acknowledged by a Participant.
"Board" shall mean the Board of Directors of the Corporation.
"Change of Control" shall mean the occurrence of any of the following: (i)
any "person" (as defined in Sections 13(d) and 14(d) of the Exchange Act)
other than the persons or the group of persons in control of the Corporation
on the date hereof is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the
Corporation representing fifty percent (50%) or more of the combined voting
power of the Corporation's then outstanding securities; (ii) within any period
of two consecutive years (not including any period prior to the effective date
of this Plan) there shall cease to be a majority of the Board comprised as
follows: individuals who at the beginning of such period constitute the Board
and any new director(s) whose election was approved by a vote of at least two-
thirds ( 2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election
was previously so approved; (iii) the shareholders of the Corporation approve
a merger of, or consolidation involving, the Corporation in which (A) the
Corporation's Common Stock, par value $1.00 per share (such stock, or any
other securities of the Corporation into which such stock shall have been
converted through a reincorporation, recapitalization or similar transaction,
hereinafter called "Common Stock of the Corporation"), is converted into
shares or securities of another corporation, or into cash or other property,
or (B) the Common Stock of the Corporation is not converted as described in
Clause (A), but in which more than forty percent (40%) of the Common Stock of
the surviving corporation in the merger is owned by shareholders other than
those who owned such amount prior to the merger; or any other transaction
after which the Corporation's Common Stock is no longer to be publicly traded;
in each case, other than a transaction solely for the purpose of
reincorporating the Corporation in another jurisdiction or recapitalizing the
Common Stock of the Corporation; or (iv) the shareholders of the Corporation
approve a plan of complete liquidation of the Corporation, or an agreement for
the sale or disposition by the Corporation of all or substantially all of the
Corporation's assets, either of which is followed by a distribution of all or
substantially all of the proceeds to the shareholders.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time.
"Committee" shall mean the salary committee of the Board, or such other
committee of the Board as may be designated by the Board to administer the
Plan.
"Corporation" shall mean Ampco-Pittsburgh Corporation, together with any
successor thereto.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
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"Fair Market Value" shall mean, (A) with respect to any property other than
Shares, the fair market value of such property determined by such methods or
procedures as shall be established from time to time by the Committee and (B)
with respect to the Shares, as of any date, (i) the mean between the high and
low sales prices of the Shares as reported on the composite tape for
securities traded on the New York Stock Exchange for such date (or if not then
trading on the New York Stock Exchange, the mean between the high and low
sales price of the Shares on the stock exchange or over-the-counter market on
which the Shares are principally trading on such date), or if, there were no
sales on such date, on the closest preceding date on which there were sales of
Shares or (ii) in the event there shall be no public market for the Shares on
such date, the fair market value of the Shares as determined in good faith by
the Committee.
"Incentive Stock Option" shall mean a right to purchase Shares from the
Corporation that is granted under Section 6 of the Plan and that is intended
to meet the requirements of Section 422 of the Code or any successor provision
thereto.
"Non-Qualified Stock Option" shall mean a right to purchase Shares from the
Corporation that is granted under Section 6 of the Plan and that is not
intended to be an Incentive Stock Option.
"Option" shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.
"Participant" shall mean any officer or other key employee of the
Corporation or its Subsidiaries eligible for an Award under Section 5 of the
Plan and selected by the Committee to receive an Award under the Plan.
"Person" shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, government or
political subdivision thereof or other entity.
"Plan" shall mean this Ampco-Pittsburgh Corporation 1997 Stock Option Plan.
"Rule 16b-3" shall mean Rule 16b-3 as promulgated and interpreted by the SEC
under the Exchange Act, or any successor rule or regulation thereto as in
effect from time to time.
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto and shall include the Staff thereof.
"Shares" shall mean the common shares of the Corporation, $1.00 par value,
or such other securities of the Corporation (i) into which such common shares
shall be changed by reason of a recapitalization, merger, consolidation,
split-up, combination, exchange of shares or other similar transaction or (ii)
as may be determined by the Committee pursuant to Section 4(b).
"Subsidiary" shall mean (i) any entity that, directly or indirectly, is
controlled by the Corporation and (ii) any entity in which the Corporation has
a significant equity interest, in either case as determined by the Committee.
"Substitute Awards" shall have the meaning specified in Section 4(c).
Section 3. Administration. (a) The Plan shall be administered by the
Committee. Subject to the terms of the Plan and applicable law, and in
addition to other express powers and authorizations conferred on the Committee
by the Plan, the Committee shall have full power and authority to: (i)
designate Participants; (ii) determine the type or types of Awards to be
granted to a Participant; (iii) determine the number of Shares to be covered
by, or with respect to which payments, rights, or other matters are to be
calculated in connection with, Awards; (iv) determine the terms and conditions
of any Award; (v) determine whether, to what extent, and under what
circumstances Awards may be settled or exercised in cash, Shares, other
securities, other Awards or other property, or canceled, forfeited, or
suspended and the method or methods by which Awards may be settled, exercised,
canceled, forfeited, or suspended; (vi) determine whether, to what extent, and
under what circumstances cash, Shares, other securities, other Awards, other
property, and other amounts payable with respect to an Award shall be deferred
either automatically or at the election of the holder thereof or of the
Committee; (vii) interpret, administer reconcile any inconsistency, correct
any default and/or supply any omission in the Plan and any instrument or
agreement relating to, or Award made under, the Plan; (viii) establish,
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amend, suspend, or waive such rules and regulations and appoint such agents as
it shall deem appropriate for the proper administration of the Plan; and (ix)
make any other determination and take any other action that the Committee
deems necessary or desirable for the administration of the Plan.
(b) Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations, and other decisions under or with respect to
the Plan or any Award shall be within the sole discretion of the Committee,
may be made at any time and shall be final, conclusive, and binding upon all
Persons, including the Corporation, any Affiliate, any Participant, any holder
or beneficiary of any Award, and any shareholder.
(c) No member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any Award
hereunder.
Section 4. Shares Available for Awards.
(a) Shares Available. Subject to adjustment as provided in Section 4(b), the
aggregate number of Shares with respect to which Awards may be granted under
the Plan shall be 300,000; and the maximum number of Shares with respect to
which Options may be granted to any Participant in any fiscal year shall be
150,000. If, after the effective date of the Plan, any Shares covered by an
Award granted under the Plan, or to which such an Award relates, are
forfeited, or if an Award has expired, terminated or been canceled for any
reason whatsoever (other than by reason of exercise or vesting), then the
Shares covered by such Award shall again be, or shall become, Shares with
respect to which Awards may be granted hereunder.
(b) Adjustments. In the event that the Committee determines that any
dividend or other distribution (whether in the form of cash, Shares, other
securities, or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Shares or other securities of the Corporation,
issuance of warrants or other rights to purchase Shares or other securities of
the Corporation, or other similar corporate transaction or event affects the
Shares such that an adjustment is determined by the Committee in its
discretion to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the
Plan, then the Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number of Shares or other securities of the
Corporation (or number and kind of other securities or property) with respect
to which Awards may be granted, (ii) the number of Shares or other securities
of the Corporation (or number and kind of other securities or property)
subject to outstanding Awards, and (iii) the exercise price with respect to
any Award or, if deemed appropriate, make provision for a cash payment to the
holder of an outstanding Award in consideration for the cancellation of such
Award.
(c) Substitute Awards. Awards may, in the discretion of the Committee, be
made under the Plan in assumption of, or in substitution for, outstanding
awards previously granted by the Corporation or its Affiliates or a company
acquired by the Corporation or with which the Corporation combines
("Substitute Awards"). The number of Shares underlying any Substitute Awards
shall be counted against the aggregate number of Shares available for Awards
under the Plan.
(d) Sources of Shares Deliverable Under Awards. Any Shares delivered
pursuant to an Award may consist, in whole or in part, of authorized and
unissued Shares or of treasury Shares.
Section 5. Eligibility. Any officer or other key employee of the Corporation
or any of its Subsidiaries (including any prospective officer or key employee)
shall be eligible to be designated a Participant.
Section 6. Stock Options.
(a) Grant. Subject to the provisions of the Plan, the Committee shall have
sole and complete authority to determine the Participants to whom Options
shall be granted, the number of Shares to be covered by each Option, the
exercise price therefor and the conditions and limitations applicable to the
exercise of the Option. The Committee shall have the authority to grant
Incentive Stock Options, or to grant Non-Qualified Stock Options, or to grant
both types of Options. In the case of Incentive Stock Options, the terms and
conditions of
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such grants shall be subject to and comply with such rules as may be
prescribed by Section 422 of the Code, as from time to time amended, and any
regulations implementing such statute. All Options when granted under the Plan
are intended to be Non-Qualified Stock Options, unless the applicable Award
Agreement expressly states that the Option is intended to be an Incentive
Stock Option. If an Option is intended to be an Incentive Stock Option, and if
for any reason such Option (or any portion thereof) shall not qualify as an
Incentive Stock Option, then, to the extent of such nonqualification, such
Option (or portion thereof) shall be regarded as a Non-Qualified Stock Option
appropriately granted under the Plan; provided that such Option (or portion
thereof) otherwise complies with the Plan's requirements relating to Non-
Qualified Stock Options.
(b) Exercise Price. The Committee shall establish the exercise price at the
time each Option is granted, which exercise price shall be set forth in the
applicable Award Agreement.
(c) Exercise. Each Option shall be exercisable at such times and subject to
such terms and conditions as the Committee may, in its sole discretion,
specify in the applicable Award Agreement or thereafter. The Committee may
impose such conditions with respect to the exercise of Options, including
without limitation, any relating to the application of federal or state
securities laws, as it may deem necessary or advisable.
(d) Payment. No Shares shall be delivered pursuant to any exercise of an
Option until payment in full of the aggregate exercise price therefor is
received by the Corporation. Such payment may be made in cash, or its
equivalent, or (i) by exchanging Shares owned by the optionee (which are not
the subject of any pledge or other security interest and which have been owned
by such optionee for at least 6 months) or (ii) subject to such rules as may
be established by the Committee, through delivery of irrevocable instructions
to a broker to sell such Shares and deliver promptly to the Corporation an
amount equal to the aggregate exercise price, or by a combination of the
foregoing, provided that the combined value of all cash and cash equivalents
and the Fair Market Value of any such Shares so tendered to the Corporation as
of the date of such tender is at least equal to such aggregate exercise price.
Section 7. Amendment and Termination.
(a) Amendments to the Plan. The Board may amend, alter, suspend,
discontinue, or terminate the Plan or any portion thereof at any time;
provided that no such amendment, alteration, suspension, discontinuation or
termination shall be made without shareholder approval if such approval is
necessary to comply with any tax or regulatory requirement applicable to the
Plan, and provided that any such amendment, alteration, suspension,
discontinuance or termination that would impair the rights of any Participant
or any holder or beneficiary of any Award theretofore granted shall not to
that extent be effective without the consent of the affected Participant,
holder or beneficiary.
(b) Amendments to Awards. The Committee may waive any conditions or rights
under, amend any terms of, or alter, suspend, discontinue, cancel or
terminate, any Award theretofore granted, prospectively or retroactively;
provided that any such waiver, amendment, alteration, suspension,
discontinuance, cancellation or termination that would impair the rights of
any Participant or any holder or beneficiary of any Award theretofore granted
shall not to that extent be effective without the consent of the affected
Participant, holder or beneficiary.
(c) Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. The Committee is hereby authorized to make adjustments in
the terms and conditions of, and the criteria included in, Awards in
recognition of unusual or nonrecurring events (including, without limitation,
the events described in Section 4(b) hereof) affecting the Corporation, any
Affiliate, or the financial statements of the Corporation or any Affiliate, or
of changes in applicable laws, regulations, or accounting principles, whenever
the Committee determines that such adjustments are appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan.
Section 8. Change of Control. In the event of a Change of Control after the
date of the adoption of this Plan, any outstanding Awards then held by
Participants, which are unexercisable or otherwise unvested, shall
automatically be deemed exercisable or otherwise vested, as the case may be,
as of immediately prior to such Change of Control.
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Section 9. General Provisions.
(a) Nontransferability. No Award may be assigned, alienated, pledged,
attached, sold or otherwise transferred or encumbered by a Participant
otherwise than by will or by the laws of descent and distribution and any such
purported assignment, alienation, pledge, attachment, sale, transfer or
encumbrance shall be void and unenforceable against the Corporation or any
Affiliate; provided that the designation of a beneficiary shall not constitute
an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.
(b) No Rights to Awards. No Participant or other Person shall have any claim
to be granted any Award, and there is no obligation for uniformity of
treatment of Participants, or holders or beneficiaries of Awards. The terms
and conditions of Awards and the Committee's determinations and
interpretations with respect thereto need not be the same with respect to each
Participant (whether or not such Participants are similarly situated).
(c) Share Certificates. All certificates for Shares or other securities of
the Corporation or any Affiliate delivered under the Plan pursuant to any
Award or the exercise thereof shall be subject to such stop transfer orders
and other restrictions as the Committee may deem advisable under the Plan or
the rules, regulations, and other requirements of the SEC, any stock exchange
upon which such Shares or other securities are then listed, and any applicable
Federal or state laws, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such
restrictions.
(d) Withholding.
(i) A Participant may be required to pay to the Corporation or any
Affiliate and the Corporation or any Affiliate shall have the right and is
hereby authorized to withhold from any Award, from any payment due or
transfer made under any Award or under the Plan or from any compensation or
other amount owing to a Participant the amount (in cash, Shares, other
securities, other Awards or other property) of any applicable withholding
taxes in respect of an Award, its exercise, or any payment or transfer
under an Award or under the Plan and to take such other action as may be
necessary in the opinion of the Corporation to satisfy all obligations for
the payment of such taxes. The Committee may provide for additional cash
payments to holders of Awards to defray or offset any tax arising from the
grant, vesting, exercise or payments of any Award.
(ii) Without limiting the generality of clause (i) above, a Participant
may satisfy, in whole or in part, the foregoing withholding liability by
delivery of Shares owned by the Participant (which are not subject to any
pledge or other security interest and which have been owned by the
Participant for at least 6 months) with a Fair Market Value equal to such
withholding liability or by having the Corporation withhold from the number
of Shares otherwise issuable pursuant to the exercise of the option a
number of Shares with a Fair Market Value equal to such withholding
liability.
(e) Award Agreements. Each Award hereunder shall be evidenced by an Award
Agreement, which shall be delivered to the Participant and shall specify the
terms and conditions of the Award and any rules applicable thereto, including
but not limited to the effect on such Award of the death, disability or
termination of employment or service of a Participant, and the effect, if any,
of such other events as may be determined by the Committee.
(f) No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Corporation or any Affiliate from adopting or
continuing in effect other compensation arrangements, which may, but need not,
provide for the grant of options (subject to shareholder approval if such
approval is required), and such arrangements may be either generally
applicable or applicable only in specific cases.
(g) No Right to Employment. The grant of an Award shall not be construed as
giving a Participant the right to be retained in the employ of, or in any
consulting relationship to, the Corporation or any Affiliate. Further, the
Corporation or an Affiliate may at any time dismiss a Participant from
employment or discontinue any consulting relationship, free from any liability
or any claim under the Plan, unless otherwise expressly provided in the Plan
or in any Award Agreement.
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(h) No Rights as Shareholder. Subject to the provisions of the applicable
Award, no Participant or holder or beneficiary of any Award shall have any
rights as a shareholder with respect to any Shares to be distributed under the
Plan until he or she has become the holder of such Shares.
(i) Governing Law. The validity, construction, and effect of the Plan and
any rules and regulations relating to the Plan and any Award Agreement shall
be determined in accordance with the laws of the Commonwealth of Pennsylvania.
(j) Severability. If any provision of the Plan or any Award is or becomes or
is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as
to any Person or Award, or would disqualify the Plan or any Award under any
law deemed applicable by the Committee, such provision shall be construed or
deemed amended to conform the applicable laws, or if it cannot be construed or
deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan or the Award, such provision shall be stricken
as to such jurisdiction, Person or Award and the remainder of the Plan and any
such Award shall remain in full force and effect.
(k) Other Laws. The Committee may refuse to issue or transfer any Shares or
other consideration under an Award if, acting in its sole discretion, it
determines that the issuance or transfer of such Shares or such other
consideration might violate any applicable law or regulation or entitle the
Corporation to recover the same under Section 16(b) of the Exchange Act, and
any payment tendered to the Corporation by a Participant, other holder or
beneficiary in connection with the exercise of such Award shall be promptly
refunded to the relevant Participant, holder or beneficiary. Without limiting
the generality of the foregoing, no Award granted hereunder shall be construed
as an offer to sell securities of the Corporation, and no such offer shall be
outstanding, unless and until the Committee in its sole discretion has
determined that any such offer, if made, would be in compliance with all
applicable requirements of the U.S. federal and any other applicable
securities laws.
(l) No Trust or Fund Created. Neither the Plan nor any Award shall create or
be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Corporation or any Affiliate and a Participant or any
other Person. To the extent that any Person acquires a right to receive
payments from the Corporation or any Affiliate pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor of
the Corporation or any Affiliate.
(m) No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award, and the Committee shall determine whether
cash, other securities, or other property shall be paid or transferred in lieu
of any fractional Shares or whether such fractional Shares or any rights
thereto shall be canceled, terminated, or otherwise eliminated.
(n) Headings. Headings are given to the Sections and subsections of the Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.
Section 16. Term of the Plan.
(a) Effective Date. The Plan shall be effective as of the date of its
approval by the shareholders of the Corporation.
(b) Expiration Date. No Award shall be granted under the Plan after December
31, 2007. Unless otherwise expressly provided in the Plan or in an applicable
Award Agreement, any Award granted hereunder may, and the authority of the
Board or the Committee to amend, alter, adjust, suspend, discontinue, or
terminate any such Award or to waive any conditions or rights under any such
Award shall, continue after December 31, 2007.
A-6
<PAGE>
[LOGO OF AMPCO PITTSBURGH]
- -PROXY- -PROXY-
This Proxy is Solicited on Behalf of the Board of Directors
THE UNDERSIGNED hereby appoints Louis Berkman, Robert A. Paul and Ernest G.
Siddons as proxies with full power of substitution, to vote as specified below
the shares of stock which the undersigned is entitled to vote at the Annual
Meeting of Shareholders of AMPCO-PITTSBURGH CORPORATION, to be held in The
Conference Room, 33rd Floor, USX Tower, Pittsburgh, PA, on Thursday, April 24,
1997, at 10:00 a.m., and any adjournments thereof and to vote in their
discretion on such other matters as may properly come before the meeting.
WHEN PROPERLY EXECUTED THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEES LISTED IN ITEM 1
(OR, IN THE DISCRETION OF THE PROXIES, THE SHARES MAY BE VOTED CUMULATIVELY) AND
FOR THE PROPOSAL IN ITEM 2.
PLEASE SIGN ON REVERSE SIDE and mail in the enclosed, postage prepaid envelope.
FOLD AND DETACH HERE
<PAGE>
Please mark
your vote as [X]
indicated in
this sample
1. ELECTION OF DIRECTORS:
FOR WITHHOLD
(except as authority
directed) to vote for
[_] [_]
(Instruction: To withhold authority to vote for any individual
nominee, write that nominee's name on the line below the names
of the nominees for Directors.)
The election of Robert A. Paul and William D. Eberle for a form
expiring in 2000.
---------------------------------------------------------------
2. A proposal to approve the adoption of the Ampco-
Pittsburgh Corporation 1997 Stock Option Plan.
FOR AGAINST ABSTAIN
[_] [_] [_]
All proxies heretofore given or executed with
respect to the shares of stock represented by this
proxy are by the filing of this proxy, expressly
revoked.
PLEASE DO NOT FOLD, STAPLE OR DAMAGE.
Signature(s) Signature(s) Date
------------------- ------------------ ------------
NOTE: Signature should conform exactly to name as stenciled hereon. Executors,
administrators, guardians, trustees, attorneys and officers signing for a
corporation should give full title. For joint accounts, each owner must sign.
FOLD AND DETACH HERE
