<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
APPLIED POWER INC.
(Name of Registrant as Specified in Its Charter)
APPLIED POWER INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(j)(2)
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:(1)
4) Proposed maximum aggregate value of transaction:
[ ] 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:
- - -------------------------
(1) Set forth the amount on which the filing fee is calculated and state
how it was determined.
<PAGE> 2
[API LOGO]
P.O. BOX 325
MILWAUKEE, WISCONSIN 53201
(414) 781-6600
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of
APPLIED POWER INC.:
Notice is hereby given that the Annual Meeting of Shareholders of APPLIED
POWER INC., a Wisconsin corporation, will be held at the University Club, 924
East Wells Street, Milwaukee, Wisconsin on Monday, January 9, 1995, at 3:30
p.m., Central Time, for the following purposes:
1. To elect a Board of six directors; and
2. To transact such other business as may properly come before the Meeting
or any adjournment thereof;
all as set forth in the accompanying Proxy Statement.
The Board of Directors has fixed the close of business on November 16, 1994
as the record date for the determination of shareholders entitled to receive
notice of and to vote at the Meeting or any adjournment thereof.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE MARK, SIGN, DATE
AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ACCOMPANYING ENVELOPE, WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IT IS IMPORTANT THAT YOUR
SHARES BE REPRESENTED AT THE MEETING, WHETHER YOUR HOLDINGS ARE LARGE OR SMALL.
IF FOR ANY REASON YOU SHOULD DESIRE TO REVOKE YOUR PROXY, YOU MAY DO SO AT ANY
TIME BEFORE IT IS VOTED.
By Order of the Board of Directors
Anthony W. Asmuth III
Secretary
Milwaukee, Wisconsin
November 23, 1994
<PAGE> 3
[API LOGO]
P.O. BOX 325
MILWAUKEE, WISCONSIN 53201
(414) 781-6600
PROXY STATEMENT
THIS PROXY STATEMENT WAS FIRST MAILED TO
SHAREHOLDERS ON OR ABOUT NOVEMBER 23, 1994
Accompanying this Proxy Statement is a Notice of Annual Meeting of
Shareholders and a form of proxy for such Meeting solicited by the Board of
Directors of Applied Power Inc. (the "Company"). The 1994 Annual Report to
Shareholders, which accompanies this Proxy Statement, contains financial
statements and certain other information concerning the Company. The Annual
Report and such financial statements are neither a part of this Proxy Statement
nor incorporated herein by reference.
The shares represented by all properly executed proxies received in time
for the Meeting will be voted as specified on such proxies. A proxy may be
revoked at any time before it is exercised. The cost of soliciting proxies,
including forwarding expense to beneficial owners of stock held in the name of
another, will be borne by the Company. No solicitation other than by mail is
contemplated, except that officers and employees of the Company may solicit the
return of proxies from certain shareholders by telephone. Shares held for the
accounts of participants in the Company's Employee Stock Purchase Plan ("ESPP")
and Employee Stock Ownership Plan ("ESOP") will be voted in accordance with the
instructions of the participants or otherwise in accordance with the terms of
such plans.
A majority of the votes entitled to be cast by shares entitled to vote,
represented in person or by proxy, constitutes a quorum for action on a matter
at the Meeting. Directors are elected by a plurality of the votes cast by the
holders of shares entitled to vote in the election at a meeting at which a
quorum is present. A "plurality" means that the individuals who receive the
largest number of votes are elected as directors up to the maximum number of
directors to be elected at the meeting. Shares for which authority is withheld
to vote for director nominees and broker non-votes (i.e., proxies from brokers
or nominees indicating that such persons have not received instructions from
the beneficial owners or other persons entitled to vote shares as to a matter
with respect to which the brokers or nominees do not have discretionary power
to vote) are considered present for purposes of establishing a quorum but will
have no effect on the election of directors except to the extent that the
failure to vote for a director nominee results in another nominee receiving a
larger number of votes. Votes attempted to be cast against a candidate are not
given legal effect and are not counted as votes cast in an election of
directors.
On November 16, 1994, the record date for determining shareholders entitled
to receive notice of and to vote at the Annual Meeting of Shareholders, the
Company's outstanding capital stock consisted of 13,226,842 shares of Class A
Common Stock ("Common Stock"). Each share of Common Stock outstanding on the
record date is entitled to one vote on all matters submitted at the Meeting.
<PAGE> 4
CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of November 16, 1994 unless otherwise
indicated, certain information with respect to the beneficial ownership of
Common Stock by each person known to management to be the beneficial owner of
more than 5% of the Common Stock, by each executive officer of the Company
named in the Summary Compensation Table below and by the Company's executive
officers and directors as a group. Briefly stated, shares are deemed to be
beneficially owned by any person or group having the power to vote or direct
the vote or the power to dispose or direct the disposition of such shares, or
who has the right to acquire beneficial ownership thereof within 60 days.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT
BENEFICIAL OWNER OWNERSHIP<F1> OF CLASS
- - ---------------- ------------ --------
<S> <C> <C>
Brinson Holdings, Inc. . . . . . . . . . . . . . . . . . . . . . . . . 683,000<F2> 5.2%
209 South LaSalle Street
Suite 1100
Chicago, IL 60604-1295
Barbara B. Buzard . . . . . . . . . . . . . . . . . . . . . . . . . . . 951,330<F3> 7.2%
6144 North Brumder Road
Hartland, WI 53029
Firstar Trust Company . . . . . . . . . . . . . . . . . . . . . . . . . 1,352,071<F3><F4> 10.2%
777 East Wisconsin Avenue
Milwaukee, WI 53202
J.P. Morgan & Co. Incorporated . . . . . . . . . . . . . . . . . . . . 1,877,700<F5> 14.2%
60 Wall Street
New York, NY 10260
RCM Capital Management . . . . . . . . . . . . . . . . . . . . . . . . 767,100<F6> 5.8%
Four Embarcadero Center, Suite 2900
San Francisco, CA 94111
Richard G. Sim . . . . . . . . . . . . . . . . . . . . . . . . . . . . 684,101<F7> 5.0%
13000 West Silver Spring Drive
Butler, WI 53007
William J. Albrecht . . . . . . . . . . . . . . . . . . . . . . . . . . 25,136<F8> *
Robert G. Deuster . . . . . . . . . . . . . . . . . . . . . . . . . . . 97,358<F9> *
David L. Harbert . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,237<F10> *
Theodore M. Lecher . . . . . . . . . . . . . . . . . . . . . . . . . . 39,587<F11> *
All Executive Officers and Directors as a Group (18 persons) . . . . . 1,296,603<F12> 9.4%
- - -------------------------
<FN>
*Less than 1%.
2
<PAGE> 5
<F1>
Unless otherwise noted, the specified persons have sole voting power
and/or dispositive power over the shares shown as beneficially owned.
<F2>
As reported on Form 13F, dated June 30, 1994, reporting (for its two
institutional investment manager affiliates, Brinson Partners, Inc. and
Brinson Trust Company) sole voting power as to 569,000 shares and sole
dispositive power as to 683,000 shares.
<F3>
Includes 543,350 shares held by a trust with respect to which Barbara B.
Buzard, Donald S. Buzard and Firstar Trust Company share voting
and dispositive power.
<F4>
Includes 728,133 shares held by Firstar Trust Company as trustee of the
Company's ESOP wherein the voting of such shares and their disposition in
a tender offer is directed by the participants but the trustee has the
power of disposition in all other circumstances, and 80,588 additional
shares of Common Stock of which Firstar Trust Company shares voting power
and/or the power of disposition. Excludes 49,250 shares held by Firstar
Trust Company as administrator of the ESPP; under such plan the
administrator does not have discretion as to disposition, and voting of
the shares is directed by the participants.
<F5>
As reported on Amendment No. 4 to Schedule 13G, dated December 31, 1993,
reporting sole voting power as to 1,482,200 shares and sole dispositive
power as to 1,877,700 shares.
<F6>
As reported on Schedule 13G, dated December 31, 1993, reporting sole
voting power as to 722,400 shares and sole dispositive power as to 767,100
shares. RCM Limited L.P., the general partner of RCM Capital Management,
and RCM General Corporation, the general partner of RCM Limited L.P., may
be deemed to have beneficial ownership of securities managed by RCM
Capital Management.
<F7>
Includes options to purchase 357,971 shares exercisable currently or
within 60 days of the record date and 2,044 shares allocated to his ESOP
account.
<F8>
Includes options to purchase 23,950 shares exercisable currently or within
60 days of the record date and 1,186 shares allocated to his ESOP account.
<F9>
Includes options to purchase 92,775 shares exercisable currently or within
60 days of the record date and 1,708 shares allocated to his ESOP account.
<F10>
Includes 737 shares allocated to his ESOP account.
<F11>
Includes options to purchase 37,600 shares exercisable currently or within
60 days of the record date and 1,911 shares allocated to his ESOP account.
<F12>
Includes options to purchase 631,018 shares exercisable currently or
within 60 days of the record date, 12,500 shares allocated to executive
officers' ESOP accounts and 212,196 shares held by certain trusts with
respect to which certain officers have voting power and the power of
disposition.
</FN>
</TABLE>
The beneficial ownership information set forth above, and below under
"Election of Directors," is based on information furnished by the specified
persons or known to the Company and is determined in accordance with Rule 13d-3
under the Securities Exchange Act of 1934, as required for purposes of this
Proxy Statement. It is not necessarily to be construed as an admission of
beneficial ownership for other purposes.
ELECTION OF DIRECTORS
At the Meeting, six directors are to be elected to serve until the next
annual meeting of shareholders and until their successors shall be elected. It
is the intention of the persons named in the accompanying form of proxy to
nominate as directors and, unless otherwise specified in a proxy by a
shareholder, to vote such proxy for the election of the persons named below.
In the event any of the nominees should become unable to serve as a director,
an eventuality which management has no reason to believe will occur, proxies
may be voted for another nominee. Each person named below is presently serving
as a director of the Company.
3
<PAGE> 6
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY OWNED
AT NOVEMBER 16, 1994
--------------------
DIRECTOR NUMBER PERCENT
NAME AND PRINCIPAL OCCUPATION AGE SINCE OF SHARES OF CLASS
----------------------------- --- ------- ----------- --------
<S> <C> <C> <C> <C>
Jack L. Heckel <F1><F2> . . . . . . . . . . . . . . . . . . . . . 63 1993 2,000<F4> *
Retired President and Chief Operating Officer, GenCorp.
Inc. (manufacturer of aerospace and defense, polymer and
automotive products)
Richard M. Jones <F1><F3> . . . . . . . . . . . . . . . . . . . . 67 1989 8,000<F5> *
Retired Chairman of the Board and Chief Executive
Officer, Guaranty Federal Savings Bank
Richard A. Kashnow <F2><F3> . . . . . . . . . . . . . . . . . . . 52 1993 2,500<F4> *
President, Schuller International Group, Inc.
(manufacturer of fiber glass products)
L. Dennis Kozlowski . . . . . . . . . . . . . . . . . . . . . . . 48 1994 0 *
Chairman of the Board, President and Chief Executive
Officer, Tyco International Ltd. (manufacturer of
fire protection systems, underwater communications
and power cables, circuit boards and other products)
Richard G. Sim . . . . . . . . . . . . . . . . . . . . . . . . . 50 1985 684,101<F6> 5.0%
Chairman of the Board, President and Chief Executive
Officer, Applied Power Inc.
Raymond S. Troubh <F1><F3> . . . . . . . . . . . . . . . . . . . 68 1985 66,250<F5> *
Financial Consultant
- - -------------------------
<FN>
*Less than 1%.
<F1>
Member of the Compensation Committee of the Board of Directors.
<F2>
Member of the Audit Committee of the Board of Directors.
<F3>
Member of the Nominating Committee of the Board of Directors.
<F4>
Includes option to purchase 1,000 shares exercisable currently or within
60 days of the record date.
<F5>
Includes options to purchase 5,000 shares exercisable currently or within
60 days of the record date.
<F6>
Includes options to purchase 357,971 shares exercisable currently or
within 60 days of the record date and 2,044 shares allocated to his
ESOP account.
</FN>
</TABLE>
All of the directors have held positions with the Company or other
organizations shown in the above table during the past five years, except that
(i) Jack L. Heckel was President and Chief Operating Officer of GenCorp. Inc.
from January 1987 through December 1993; (ii) Richard M. Jones was Chairman of
the Board and Chief Executive Officer of Guaranty Federal Savings Bank from
January 1989 through December 1991; (iii) Richard A. Kashnow was Senior Vice
President and General Manager of Manville Corporation from September 1987
through April 1991; and (iv) L. Dennis Kozlowski was named President of Tyco
4
<PAGE> 7
International Ltd. in December 1989, its Chief Executive Officer in July 1992
and its Chairman of the Board in January 1993.
Jack L. Heckel is a director of WD-40 Co. and Advanced Tissue Sciences,
Inc. Richard M. Jones is a director of Baker, Fentress & Co., Guaranty Federal
Savings Bank, Illinois Tool Works Inc. and MCI Communications Corporation.
Richard A. Kashnow is a director of Schuller International Group, Inc. L.
Dennis Kozlowski is a director of Tyco International Ltd. and Thiokol
Corporation. Richard G. Sim is a director of The Gehl Company and IPSCO Inc.
Raymond S. Troubh is a director of ADT Limited, American Maize-Products Co.,
America West Airlines, Inc., ARIAD Pharmaceuticals, Inc., Becton Dickinson and
Company, Benson Eyecare Corporation, Foundation Health Corporation, General
American Investors Company, Inc., Manville Corporation, Olsten Corporation,
Petrie Stores Corporation, Riverwood International Corporation, Time Warner
Inc., Triac Companies, Inc. and Wheeling-Pittsburgh Corporation.
BOARD MEETINGS, COMMITTEES AND DIRECTOR COMPENSATION
There were five meetings of the Board of Directors, two meetings of the
Audit Committee, three meetings of the Compensation Committee and one meeting
of the Nominating Committee during the year ended August 31, 1994. During the
period in the last fiscal year in which they served, all members of the Board
of Directors attended at least 75% of the total number of meetings of the Board
of Directors and all the committees on which they served.
The Audit Committee of the Board of Directors (i) reviews the scope and
timing of the audit of the Company's financial statements by the Company's
independent accountants; (ii) reviews with the independent accountants, and
with the Company's management, policies and procedures with respect to internal
auditing and financial and accounting controls; and (iii) reviews with the
independent accountants their reports on the Company's financial statements and
recommendations they make for improvements in the Company's internal controls
and the implementation of such recommendations.
The Compensation Committee of the Board of Directors determines the
compensation of the Company's executive officers, awards bonuses to such key
management personnel as the Committee selects and administers the Company's
stock option plans.
The Nominating Committee of the Board of Directors seeks qualified persons
for the position of director to recommend to the entire Board of Directors. In
carrying out its responsibilities, the Nominating Committee will consider
candidates suggested by other directors, employees and shareholders.
Suggestions for candidates, accompanied by biographical material, may be sent
to the Secretary of the Company at its corporate offices.
For the 1994 fiscal year, directors who were not employees of the Company
were paid an annual retainer of $16,000 for serving on the Board of Directors
and an attendance fee of $1,000 for each Board of Directors meeting and
committee meeting attended. Directors who are employees of the Company do not
receive separate remuneration in connection with their service on the Board or
Board committees. Each non-employee director also receives an option each year
to purchase 1,000 shares of Common Stock under the 1989 Outside Directors'
Stock Option Plan (the "1989 Plan"). The 1989 Plan is intended to promote the
growth and development of the Company by providing incentives for non-employee
directors of the Company through the grant to such directors of nonqualified
stock options to acquire shares of Common Stock. There is no discretion as to
the amount or timing of options to be granted, which are fixed by the terms of
the 1989
5
<PAGE> 8
Plan. The exercise price at which shares may be purchased under each option is
equal to the fair market value of the shares on the date of grant. Options are
not exercisable until eleven months after the date of grant and then become
fully exercisable, in whole or in part, at any time prior to their expiration
or termination. Unless earlier exercised or terminated, the expiration date of
each option granted under the 1989 Plan is ten years and one day after the date
of grant. All of the non-employee directors, except Mr. Kozlowski, were
granted options in fiscal 1994 for 1,000 shares of Common Stock at an exercise
price of $16.6875 per share. Mr. Kozlowski will first be eligible for an
option grant under the 1989 Plan after the 1995 Annual Meeting of Shareholders.
At November 16, 1994, options for 4,000 shares had been exercised, options for
16,000 shares were outstanding and 40,000 shares were reserved for future
grants under the 1989 Plan.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
Development of Compensation Approach and Objectives. The Compensation
Committee of the Board of Directors establishes all of the policies under which
compensation is paid or awarded to the Company's executive officers, and
determines the amount of such compensation. No member of the Committee is
employed by the Company. The Committee's objective is to develop a total
compensation program that is competitive in the marketplace and which provides
significant incentive to increase shareholder value. Each year the Committee
reviews the executive compensation policies with respect to the market
competitiveness of the program, and then determines what changes, if any, are
appropriate in the compensation program for the following year. Compensation
of the Company's executive officers currently consists of three key elements--
salary, bonus and stock options.
The Committee retains an independent outside consultant who provides data
regarding compensation practices in U.S. manufacturing companies. Competitive
pay standards are based upon the results of several compensation surveys,
including comparisons with approximately three hundred manufacturing companies.
This data, along with management's recommendations for particular executive
officer compensation, and information on an executive's experience, expertise
and demonstrated performance, is reviewed by the Committee. The total value of
each executive's pay standard is intended to equal the competitive median for
like positions in companies of similar size and type, but the mix of
compensation is atypical. Specifically, cash compensation is lower than the
median: salary standards are targeted at 95% of the market median and target
bonuses are set at 70% of the market median. Stock option grants, on the other
hand, are above the median for other companies in order to bring the total
compensation opportunity up to competitive market standards. This compensation
mix is designed to encourage a continued focus on building shareholder value.
While the Committee does exercise its discretion to vary compensation from
these guidelines, in general, it has followed this approach in determining
executive officer compensation.
Stock options are granted annually to executive officers. Options may
also be granted to other key employees whose present and future contributions
are especially important to the Company. All option grants are priced at 100%
of market value as of the date of grant. Unless earlier terminated, options
expire ten years from the date of grant and generally become exercisable as to
half of the shares granted two years after the date of grant and fully
exercisable five years after the date of grant.
The Committee values stock option grants at 50% of the exercise price.
This is an estimate of the present value of the expected gain from an option as
of the date of grant. This valuation method is
6
<PAGE> 9
recommended by the Committee's independent consultant because it reflects the
average discounted value of the actual gains produced by options granted by
U.S. industrial firms over the past several decades. The Committee favors the
simplicity of this 50% estimate and believes it to be as good a prediction of
the actual gains and costs of an option grant as other methods.
Key Measurement Criteria for Bonuses. Bonus payments are made to each
executive based upon the degree of achievement of each year's financial and
personal objectives. An executive may receive more, or less, than the target
bonus based on actual business results and satisfaction of executive-specific
goals.
Each executive responsible for a business unit is measured principally by
the performance of that unit. The measuring index utilized is "Combined
Management Measure" ("CMM"), which is unit operating profit less a charge based
upon the net assets employed by the unit. In fiscal 1994, CMM constituted 80%
of the bonus measurement. The remaining 20% of a business unit executive's
bonus was based on other goals specific to the individual, such as sales growth
or business development in specified markets. For the fiscal year ended August
31, 1994, bonuses earned and paid to business unit executives ranged from 20%
to 113% of their target bonuses and averaged 65% of such target bonuses.
Bonus payments for Company executives not in charge of business units are
primarily determined by the performance of the Company as a whole. For fiscal
1994, 40% of such an executive's bonus was based on the Company's return on net
assets and 40% on the Company's earnings per share for the period. The
remaining 20% of such a bonus was based on the degree of accomplishment of
certain pre-determined projects related to each executive's area of
responsibility. For the fiscal year ended August 31, 1994, bonuses earned and
paid to this group ranged from 67.5% to 86.3% of their target bonuses and
averaged 81.4% of such target bonuses.
Chief Executive Officer Compensation. Competitive data provided by the
Committee's independent consultant established a total compensation value of
$991,000 for the chief executive officer position. Following the compensation
philosophy described above for the executive officers, the compensation
opportunity for Richard G. Sim, the Company's Chief Executive Officer,
consisted of a salary of $362,000 (95% of the market median), a target bonus of
$213,000 (70% of the market median) and a stock option grant valued at $416,000
(52,000 shares valued at 50% of the exercise price).
Mr. Sim's fiscal 1994 salary of $362,000 remained unchanged from the prior
year. Mr. Sim's fiscal 1994 bonus was based solely on Company performance, 50%
of which was measured by return on net assets and 50% by earnings per share.
Mr. Sim's fiscal 1994 bonus of $176,620, which represents 82.9% of his target
bonus, reflects attainment of 92.5% of the Company's return on net assets
target and 73.3% of the Company's earnings per share target.
Tax Deductibility of Executive Compensation. Beginning in 1994, Section
162(m) of the Internal Revenue Code limits the Company's federal income tax
deduction to $1,000,000 per year for compensation to its chief executive
officer or any of its four other highest paid executive officers.
Performance-based compensation is not, however, generally subject to the
deduction limit, provided certain requirements of Section 162(m) are satisfied.
In order to preserve the deductibility of performance-based compensation, the
Company will seek to comply with Section 162(m) of the Internal Revenue Code to
the extent such compliance is practicable and in the best interests of the
Company and its shareholders.
Richard M. Jones, Chairman
Jack L. Heckel
Raymond S. Troubh
7
<PAGE> 10
SUMMARY COMPENSATION TABLE
The following table sets forth compensation awarded to, earned by or paid
to the Company's Chief Executive Officer and each of the Company's other four
most highly compensated executive officers who were serving as executive
officers at the end of fiscal 1994 for services rendered to the Company and its
subsidiaries during fiscal 1994 ("named executive officers"). Also included in
the table is compensation information for those individuals for fiscal years
1992 and 1993.
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
----------------------- ------------------
AWARDS
----------- ALL OTHER
SECURITIES UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS/SARS(#)<F1> ($)<F2>
--------------------------- ---- --------- -------- -----------------------------------
<S> <C> <C> <C> <C> <C>
Richard G. Sim
Chairman, President and
Chief Executive Officer 1994 362,000 176,620 52,000 11,515
Chairman, President and
Chief Executive Officer 1993 362,000 0 52,000 39,917
Chairman, President and
Chief Executive Officer 1992 350,000 152,646 43,500 33,962
Robert G. Deuster
Senior Vice President,
Distributed Products Group 1994 186,664 14,400 13,625 5,739
Vice President;
President of Barry Controls 1993 180,000 96,864 14,500 5,739
Vice President;
President of Barry Controls 1992 160,000 0 9,400 5,739
William J. Albrecht
Senior Vice President,
Engineered Solutions Group 1994 162,672 51,374 15,875 12,310
Vice President; President
of APITECH/Power-Packer 1993 140,000 23,068 15,500 11,982
Vice President; President
of APITECH/Power-Packer 1992 115,000 34,801 9,400 8,758
David L. Harbert <F3>
Senior Vice President and
Chief Financial Officer 1994 210,000 55,810 16,000 21,508
Senior Vice President and
Chief Financial Officer 1993 210,000 53,742 30,000 20,093
Theodore M. Lecher
Vice President; President of
GB Electrical 1994 150,000 61,020 11,750 5,329
Vice President; President of
GB Electrical 1993 144,000 65,308 12,000 5,329
Vice President; President of
GB Electrical 1992 135,000 33,877 10,200 5,029
8
<PAGE> 11
<FN>
<F1>
Consists entirely of stock options. In July or August of each year, the
Compensation Committee awards options applicable to the executive's
compensation for the following fiscal year. Option awards listed for a
given fiscal year reflect the option grant which was made at the end of
the prior fiscal year.
<F2>
The 1994 amounts represent the Company's 401(k) matching contributions as
follows: Mr. Sim - $300, Mr. Deuster - $300, Mr. Albrecht - $0, Mr.
Harbert - $300 and Mr. Lecher - $300; Company allocations under the ESOP
as follows: Mr. Sim - $0, Mr. Deuster - $0, Mr. Albrecht - $5,572, Mr.
Harbert - $7,912 and Mr. Lecher - $0; and premiums paid by the Company for
split-dollar life insurance as follows: Mr. Sim - $11,215, Mr. Deuster -
$5,349, Mr. Albrecht -$6,738, Mr. Harbert - $13,296 and Mr. Lecher -
$5,029.
<F3>
Mr. Harbert joined the Company on September 1, 1992 and ceased to be an
executive officer of the Company on September 30, 1994.
</FN>
</TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning stock option grants
during the last fiscal year to the named executive officers. No stock
appreciation rights ("SARs") were granted in fiscal 1994. These grants
comprise the stock option element of the executive's fiscal 1995 compensation.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
-------------------------------------------------------------------- ANNUAL RATES OF
NUMBER OF STOCK PRICE
SECURITIES APPRECIATION FOR
UNDERLYING PERCENT OF TOTAL OPTIONS/SARS EXERCISE OR OPTION TERM<F3>
OPTIONS/SARS GRANTED TO EMPLOYEES IN BASE PRICE EXPIRATION -------------------
NAME GRANTED(#) FISCAL YEAR<F1> ($/SH) DATE<F2> 5%($) 10%($)
---- -------------- ----------- ------------ --------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Richard G. Sim 49,900 25.5% 21.375 7/28/04 670,793 1,699,860
Robert G. Deuster 19,900 10.2% 21.375 7/28/04 267,510 677,900
William J. Albrecht 17,800 9.1% 21.375 7/28/04 239,281 606,363
David L. Harbert 0 0% -- -- 0 0
Theodore M. Lecher 8,100 4.1% 21.375 7/28/04 108,886 275,929
_________________________
<FN>
<F1>
Based on stock option grants for 195,400 shares to all employees during
the fiscal year ended August 31, 1994.
<F2>
Unless earlier terminated, options expire ten years from the date of
grant and generally become exercisable as to half of the shares
granted two years after the date of grant and fully exercisable five years
after the date of grant.
<F3>
The dollar amounts under these columns are the result of calculations at
5% and 10% appreciation rates set by the Securities and Exchange
Commission and are not intended to forecast possible future appreciation,
if any, of the Common Stock price.
</FN>
</TABLE>
9
<PAGE> 12
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR
VALUES
The following table sets forth information for each of the named executive
officers concerning the number and value of stock options outstanding at the
end of the fiscal year. None of the named executive officers exercised options
during the last fiscal year. No SARs are outstanding.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/SARS AT FISCAL IN-THE-MONEY OPTIONS/SARS
YEAR-END(#) AT FISCAL YEAR-END($)<F1>
----------------------------- ------------------------------
NAME EXERCISABLE UNEXERCISABLE<F2> EXERCISABLE UNEXERCISABLE<F2>
---- ----------- ---------------- ----------- ----------------
<S> <C> <C> <C> <C>
Richard G. Sim . . . . . . . . . . . . . . . 357,971 169,150 1,738,154 707,225
Robert G. Deuster . . . . . . . . . . . . . . 92,775 50,975 849,952 189,781
William J. Albrecht . . . . . . . . . . . . . 23,950 51,625 115,197 219,444
David L. Harbert . . . . . . . . . . . . . . 0 46,000 0 310,375
Theodore M. Lecher . . . . . . . . . . . . . 37,600 36,450 175,325 161,038
_________________________
<FN>
<F1>
Based on the $22.25 closing price of the Common Stock on the New York
Stock Exchange at the end of the fiscal year.
<F2>
Represents unvested options at the end of fiscal 1994.
</FN>
</TABLE>
PERFORMANCE GRAPHS
The following graph shows the cumulative total shareholder return on the
Common Stock during the preceding five fiscal years as compared to the returns
on the Standard & Poor's 500 Stock Index and the Standard & Poor's Diversified
Manufacturing Index. The graph assumes that $100 was invested on August 31,
1989 in the Common Stock and each index and that all dividends were reinvested.
[ 1989-1994 GRAPH ]
10
<PAGE> 13
<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
APPLIED POWER $100.00 $83.03 $ 75.42 $ 73.63 $ 80.73 $107.14
S&P 500 INDEX 100.00 95.01 120.58 130.13 149.93 158.13
S&P DIV. MFG. INDEX 100.00 90.58 115.45 113.56 142.77 159.79
</TABLE>
The following graph shows the cumulative total shareholder return on the
Common Stock since it became publicly traded on August 6, 1987 through August
31, 1994 as compared to the returns on the Standard & Poor's 500 Stock Index
and the Standard & Poor's Diversified Manufacturing Index. The graph assumes
that $100 was invested on August 6, 1987 in the Common Stock and each index and
that all dividends were reinvested.
[ 8/6/87-1994 GRAPH ]
<TABLE>
<CAPTION>
8/6/87 1987 1988 1989 1990 1991 1992 1993 1994
------ ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
APPLIED POWER $100.00 $111.43 $220.26 $278.08 $230.88 $209.72 $204.74 $224.51 $297.95
S&P 500 INDEX 100.00 102.39 83.97 116.92 111.09 140.98 152.15 175.30 184.89
S&P DIV. MFG.
INDEX 100.00 102.88 84.39 104.87 94.99 121.07 119.09 149.71 167.57
</TABLE>
EMPLOYMENT AGREEMENT
The Company entered into an agreement with Richard G. Sim in May 1994
which supersedes his employment agreement originally entered into in July 1985.
The new agreement provides that if Mr. Sim's employment with the Company is
terminated as a result of his death or permanent disability, he or his
beneficiary will receive his then current salary for a period of one year
following such termination and a pro rata portion of any bonus award earned for
the fiscal year in which such termination occurs. The agreement requires the
Company to maintain Mr. Sim's coverage under its present long-term disability
benefit plan or a substantially similar plan providing at least comparable
benefits. In the event that Mr. Sim qualifies for
11
<PAGE> 14
a long-term disability benefit, the Company will supplement any plan benefit
payable to Mr. Sim to the extent necessary to provide a total long-term
disability benefit payment that is equal to 30% of his then base pay. Such
supplemental benefit will be provided at no cost to Mr. Sim.
OTHER INFORMATION
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Based on information available to it, the Company is not aware that any
director, officer or beneficial owner of 10% or more of the Common Stock failed
to file on a timely basis reports required by Section 16(a) of the Securities
Exchange Act of 1934 during the last fiscal year, except that Mr. Michael D.
O'Toole, a former officer of the Company, inadvertently failed to file on a
timely basis after leaving the Company, three reports relating to twelve
transactions involving the simultaneous exercise of Company stock options and
sale of the underlying Common Stock and one additional sale of Common Stock.
These late filings were cured promptly after Mr. O'Toole became aware of them.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche LLP as the
independent certified public accountants to audit the financial statements of
the Company for the fiscal year ending August 31, 1995. The Company expects
that representatives of Deloitte & Touche LLP will be present at the Annual
Meeting and available to respond to appropriate questions and have the
opportunity to make a statement if they desire.
SHAREHOLDER PROPOSALS
Shareholder proposals must be received by the Company no later than July
26, 1995 in order to be considered for inclusion in next year's annual meeting
proxy statement.
ADDITIONAL MATTERS
Management is not aware of any matters which will be presented for action
at the Meeting other than the proposal set forth in the Notice of Annual
Meeting and described herein. If other matters do come before the Meeting, it
is intended that proxies will be voted in accordance with the judgment of the
person or persons exercising the authority conferred thereby.
By Order of the Board of Directors
Anthony W. Asmuth III
Secretary
Milwaukee, Wisconsin
November 23, 1994
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR
NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, SHAREHOLDERS ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE PROXY AS SOON AS POSSIBLE.
COPIES OF THE COMPANY'S FORM 10-K ANNUAL REPORT AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION ARE AVAILABLE, FREE OF CHARGE, UPON REQUEST
DIRECTED TO ROBERT C. ARZBAECHER, VICE PRESIDENT AND CHIEF FINANCIAL OFFICER,
APPLIED POWER INC., P.O. BOX 325, MILWAUKEE, WISCONSIN 53201.
12
<PAGE> 15
APPLIED POWER INC.
ANNUAL MEETING OF SHAREHOLDERS - JANUARY 9, 1995
P R O X Y
CLASS A COMMON STOCK
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
RICHARD G. SIM AND ROBERT C. ARZBAECHER, and each of them, are hereby
authorized as Proxies, with full power of substitution, to represent and vote
the Class A Common Stock of the undersigned at the Annual Meeting of
Shareholders of Applied Power Inc., a Wisconsin corporation, to be held on
Monday, January 9, 1995, or any adjournment thereof, with like effect as if the
undersigned were personally present and voting, upon the following matters:
<TABLE>
<S> <C> <C>
1. Election of Directors [ ] FOR all nominees listed below (except [ ] WITHHOLD AUTHORITY to vote for all nominees
as marked to the contrary below) listed below
</TABLE>
JACK L. HECKEL, RICHARD M. JONES, RICHARD A. KASHNOW, L. DENNIS KOZLOWSKI,
RICHARD G. SIM AND RAYMOND S. TROUBH
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write that nominee's name on the line provided below.)
2. In their discretion, upon such other business as may properly come before
the Meeting or any adjournment thereof;
all as set out in the Notice and Proxy Statement relating to the Meeting,
receipt of which is hereby acknowledged.
(Continued on reverse side)
(Continued from reverse side)
ESOP
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER SPECIFIED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSAL 1.
Dated: _____________________________, 19___
__________________________________________
__________________________________________
Signature(s) of Shareholder(s)
PLEASE SIGN PERSONALLY AS NAME APPEARS
AT LEFT. When signing as attorney,
executor, administrator, personal
representative, trustee or guardian, give
full title as such. If signer is a
corporation, sign full corporate name by
duly authorized officer. If stock is held
in the name of two or more persons, all
should sign.
PLEASE SIGN AND DATE THIS PROXY AND RETURN IN ENCLOSED PREPAID ENVELOPE -
PLEASE DO NOT FOLD
<PAGE> 16
APPLIED POWER INC.
ANNUAL MEETING OF SHAREHOLDERS - JANUARY 9, 1995
P R O X Y
CLASS A COMMON STOCK
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
RICHARD G. SIM AND ROBERT C. ARZBAECHER, and each of them, are hereby
authorized as Proxies, with full power of substitution, to represent and vote
the Class A Common Stock of the undersigned at the Annual Meeting of
Shareholders of Applied Power Inc., a Wisconsin corporation, to be held on
Monday, January 9, 1995, or any adjournment thereof, with like effect as if the
undersigned were personally present and voting, upon the following matters:
<TABLE>
<S> <C> <C>
1. Election of Directors [ ] FOR all nominees listed below (except [ ] WITHHOLD AUTHORITY to vote for all nominees
as marked to the contrary below) listed below
</TABLE>
JACK L. HECKEL, RICHARD M. JONES, RICHARD A. KASHNOW, L. DENNIS KOZLOWSKI,
RICHARD G. SIM AND RAYMOND S. TROUBH
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the line provided below.)
________________________________________________
2. In their discretion, upon such other business as may properly come before
the Meeting or any adjournment thereof;
all as set out in the Notice and Proxy Statement relating to the Meeting,
receipt of which is hereby acknowledged.
(Continued on reverse side)
(Continued from reverse side)
ESPP
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER SPECIFIED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSAL 1.
Dated: _____________________________, 19___
__________________________________________
__________________________________________
Signature(s) of Shareholder(s)
PLEASE SIGN PERSONALLY AS NAME APPEARS
AT LEFT. When signing as attorney,
executor, administrator, personal
representative, trustee or guardian, give
full title as such. If signer is a
corporation, sign full corporate name by
duly authorized officer. If stock is held
in the name of two or more persons, all
should sign.
PLEASE SIGN AND DATE THIS PROXY AND RETURN IN ENCLOSED PREPAID ENVELOPE -
PLEASE DO NOT FOLD
<PAGE> 17
APPLIED POWER INC.
ANNUAL MEETING OF SHAREHOLDERS - JANUARY 9, 1995
P R O X Y
CLASS A COMMON STOCK
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
RICHARD G. SIM AND ROBERT C. ARZBAECHER, and each of them, are hereby
authorized as Proxies, with full power of substitution, to represent and vote
the Class A Common Stock of the undersigned at the Annual Meeting of
Shareholders of Applied Power Inc., a Wisconsin corporation, to be held on
Monday, January 9, 1995, or any adjournment thereof, with like effect as if the
undersigned were personally present and voting, upon the following matters:
<TABLE>
<S> <C> <C>
1. Election of Directors [ ] FOR all nominees listed below (except [ ] WITHHOLD AUTHORITY to vote for all nominees
as marked to the contrary below) listed below
</TABLE>
JACK L. HECKEL, RICHARD M. JONES, RICHARD A. KASHNOW, L. DENNIS KOZLOWSKI,
RICHARD G. SIM AND RAYMOND S. TROUBH
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the line provided below.)
_______________________________________________
2. In their discretion, upon such other business as may properly come before
the Meeting or any adjournment thereof;
all as set out in the Notice and Proxy Statement relating to the Meeting,
receipt of which is hereby acknowledged.
(Continued on reverse side)
(Continued from reverse side)
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER SPECIFIED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSAL 1.
Dated: _____________________________, 19___
__________________________________________
__________________________________________
Signature(s) of Shareholder(s)
PLEASE SIGN PERSONALLY AS NAME APPEARS
AT LEFT. When signing as attorney,
executor, administrator, personal
representative, trustee or guardian, give
full title as such. If signer is a
corporation, sign full corporate name by
duly authorized officer. If stock is held
in the name of two or more persons, all
should sign.
PLEASE SIGN AND DATE THIS PROXY AND RETURN IN ENCLOSED PREPAID ENVELOPE -
PLEASE DO NOT FOLD
