<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (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 Rule 14a-11(c) or Rule 14a-12
MET-COIL SYSTEMS CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
MET-COIL SYSTEMS CORPORATION
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $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 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
<PAGE> 2
MET-COIL SYSTEMS CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 8, 1996
To the Stockholders of
Met-Coil Systems Corporation
Notice is hereby given that the annual meeting of stockholders of
Met-Coil Systems Corporation, a Delaware corporation, will be held at the
Sheraton Inn, 525 33rd Avenue SW, Cedar Rapids, Iowa on October 8, 1996, at
10:00 A.M. Central Time, for the following purposes:
1. To elect two directors, each to hold office for a three-year
term;
2. To approve and ratify the appointment of Deloitte & Touche,
LLP as independent auditors; and
3. To transact such other business as may properly come before
said meeting.
Stockholders of record as of the close of business on August 23, 1996,
will be entitled to vote at such annual meeting and any adjournment thereof.
Shares should be represented as fully as possible, since a majority of all
outstanding shares is required to constitute a quorum.
PLEASE MARK, SIGN, DATE AND MAIL THE ACCOMPANYING PROXY IN THE
ENCLOSED SELF-ADDRESSED, STAMPED ENVELOPE, WHETHER OR NOT YOU EXPECT TO ATTEND
THE MEETING IN PERSON. You may revoke your proxy at the meeting should you be
present and desire to vote your shares in person, and you may revoke your proxy
for any reason at any time prior to the voting thereof, either by written
revocation prior to the meeting or by appearing at the meeting and voting in
person. Your cooperation is respectfully solicited.
By order of the Board of Directors,
Carroll Reasoner
Secretary
Cedar Rapids, Iowa
September 13, 1996
<PAGE> 3
MET-COIL SYSTEMS CORPORATION
5486 SIXTH STREET SW
CEDAR RAPIDS, IOWA 52404
(319) 363-6566
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 8, 1996
INTRODUCTION
The enclosed proxy is solicited on behalf of the Board of Directors of
Met-Coil Systems Corporation (the "Company") in connection with the annual
meeting of stockholders to be held on October 8, 1996, at 10:00 A.M. Central
Time, and any adjournment thereof ("Annual Meeting"), at the Sheraton Inn, 525
33rd Avenue SW, Cedar Rapids, Iowa.
The cost of proxy solicitation will be borne by the Company. In
addition to the solicitation of proxies by the use of the mails, certain
officers and other regular employees of the Company may devote part of their
time (but will not be specifically compensated therefor) to solicit proxies
personally, by telephone, mail or facsimile to the extent necessary to ensure
sufficient representation at the annual meeting. Proxies may be revoked at any
time prior to the voting thereof. Revocation may be done prior to the meeting
by written revocation sent to the Assistant Secretary of the Company, 5486
Sixth Street SW, Cedar Rapids, Iowa 52404; or it may be done personally upon
oral or written request at the Annual Meeting.
This proxy statement was first mailed or delivered to stockholders on
or about September 13, 1996.
RECORD DATE; VOTING SECURITIES OUTSTANDING
The close of business on August 23, 1996, is the record date for
determining the holders of common stock, $.01 par value ("Common Stock"), of
the Company entitled to notice of and to vote at the Annual Meeting.
As of August 23, 1996, the Company had outstanding voting securities
consisting of 3,120,488 shares of Common Stock, each share being entitled to
one vote on all matters to be voted upon by the holders of Common Stock. Each
holder of record of outstanding Common Stock at the close of business on August
23, 1996, will be entitled to vote at the Annual Meeting.
PRINCIPAL SHAREHOLDERS
The following table sets forth, with respect to the Company's Common
Stock (the only class of voting securities), all persons known by the Company's
Board of Directors to be the beneficial owner of more than five percent of the
Company's voting securities as of August 23, 1996.
<TABLE>
<CAPTION>
NUMBER OF SHARES
AND NATURE OF
BENEFICIAL PERCENTAGE OF
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP(1) CLASS
- ------------------------------------ ------------ -------------
<S> <C> <C> <C>
First National Bank (ESOP Trustee) . . . . . . . . . . . . . . . . . . . . . 220,564 (2) 8.2%
200 First Street S.W.,
P.O. Box 5850
Cedar Rapids, Iowa 52406
Roy J. Carver, Jr. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 773,649 (3) 22.7%
2415 Park Avenue
Muscatine, Iowa 52761
Construction Technology Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 215,000 (4) 6.8%
570 Taxter Road
Elmsford, New York 10523
Michael J. Nonnenmann . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259,770 (5) 8.1%
2513 24th Street
Rock Island, IL 61201
Met-Coil Retirement Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . 275,524 (6) 8.8%
5486 6th Street SW
Cedar Rapids, IA 52404
</TABLE>
2
<PAGE> 4
(1) Nature of beneficial ownership is direct unless otherwise indicated by
footnote. Beneficial ownership as shown in the table arises from sole
voting and investment power unless otherwise indicated by footnote.
(2) Includes a total of 220,564 shares held by the Met-Coil Systems
Corporation Employee Stock Ownership Plan (the "ESOP"), of which
191,513 shares have been allocated to the accounts of participants.
First National Bank, as Trustee, has shared voting and investment
power with respect to all of such shares.
(3) Includes 740 shares held in the name of minor children, with respect
to which Mr. Carver disclaims beneficial ownership. Includes 3,886
shares awarded to Mr. Carver as a participant in the Company's
Non-Employee Director Restricted Stock Plan, as to which Mr. Carver
has sole voting power. These 3,886 shares may not be sold or assigned
by Mr. Carver until they have vested. See "Directors'
Compensation-Restricted Stock Plan" herein. Includes 285,000 shares
issuable upon conversion of 95,000 shares of the Company's 6%
convertible preferred stock (the "preferred stock"), 40,000 shares of
which preferred stock are held by the John A. Carver, Trust and the
beneficial ownership of which are hereby disclaimed by Mr. Carver.
(4) Includes 15,000 shares of common stock issuable upon conversion of
5,000 shares of preferred stock held by Construction Technology.
(5) Includes 69,000 shares of common stock issuable upon conversion of
23,000 shares of preferred stock held by Dr. Nonnenmann. Includes
1,295 shares awarded to Mr. Nonnenmann as a participant in the
Company's non-employee Director Restricted Stock Plan, as to which Mr.
Nonnenmann has sole voting power. These 1,295 shares may not be sold
or assigned by Mr. Nonnenmann until they have vested. See "Directors'
Compensation-Restricted Stock Plan" herein.
(6) Includes a total of 275,524 shares held by the Met-Coil Retirement
401(k) Plan, which have been allocated to the accounts of
participants. The participants have voting power with respect to
these shares.
PROPOSAL 1 - ELECTION OF DIRECTORS
The Board of Directors is divided into three classes, with members of
each class serving a three-year term. Each class consists, as nearly as
possible, of one-third of the total number of directors. Currently, the Board
may have a maximum of eight members. Two directors have been nominated for
re-election by the Board to serve until the 1999 Annual Meeting and until their
successors shall be elected and qualified: John F. Logan and Michael J.
Nonnenmann. Information with respect to the nominees, and the directors who
are continuing in office and whose terms do not expire this year, is set forth
below.
Mr. Frank W. Jones, a director since 1987, whose term expires in 1996
voluntarily resigned as a director on February 29, 1996. Harold G. Spriggs, a
director since 1989, voluntarily resigned as a director on April 30, 1996. His
term expires in 1998. The board of directors has not yet acted to fill the
vacancies created by these occurances.
Proxies will be voted FOR the election of each of the nominees named
below unless otherwise specified in the proxies. If any of said nominees is
not a candidate for election as a director at the Annual Meeting, an event
which the Board of Directors does not anticipate, the proxies will be voted for
a substitute nominee or nominees appointed by the Board of Directors.
The election of directors requires the vote of a majority of the
voting power present in person or represented by proxy at the Annual Meeting,
assuming a quorum is present. Abstentions and broker non-votes will not be
included in the vote totals and are counted only for the purposes of
determining whether a quorum is present at the annual meeting.
3
<PAGE> 5
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES NAMED BELOW,
FOR TERMS EXPIRING IN 1999
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE SINCE PRINCIPAL OCCUPATION FOR LAST 5 YEARS AND DIRECTORSHIPS
- ---- --- -------- ----------------------------------------------------------------------
<S> <C> <C> <C>
John F. Logan 60 1993 Group President of DT Assembly Systems Group, a builder of
Automated Assembly Systems since July 1996. President and Director of
Advanced Assembly Automation, Inc., a wholly owned subsidiary of DT Assembly,
since 1984.
Michael J. Nonnenmann 49 1995 President of Michael J. Nonnenmann, DDS, M.S., LTD
Orthodontics since 1976.
</TABLE>
DIRECTORS CONTINUING IN OFFICE (1)
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE SINCE PRINCIPAL OCCUPATION FOR LAST 5 YEARS AND DIRECTORSHIPS
- ---- --- -------- ----------------------------------------------------------------------
<S> <C> <C> <C>
Raymond H. Blakeman 72 1977 Chairman of the Company since July 1986 and CEO of the
Term Expires 1997 Company from July 1986 to December 1988, from June 1990 to May 31,1994 and
from May 1995 to present.
E. Keith Moore 74 1990 President, Hurco International Inc., a subsidiary of Hurco
Term Expires 1998 Companies, Inc. a manufacturer of machine tools. Prior thereto, served in a
variety of advisory capacities to Hurco. Since October 1985, a director of
Hurco Companies, Inc.
Roy J. Carver, Jr. 53 1993 Chairman of Carver Pump Co., a manufacturer of pumps, since
Term Expires 1998 1982. A Director of Bandag, Inc. and Iowa First Bancshares, both companies of
Muscatine, Iowa. (2)
Gary M. Neal 46 1993 President and CEO of Watlow Electric Manufacturing Co., a maker
Term Expires 1997 of heat sensors and controls, since 1991. Prior thereto Vice President of
International Operations from 1987 to 1991.
</TABLE>
(1) Mr. Frank W. Jones, a director since 1987, whose term expires in 1996
voluntarily resigned as a director on February 29, 1996. Harold G.
Spriggs, a director since 1989, voluntarily resigned as a director on
April 30, 1996. His term expires in 1998. The board of directors has
not yet acted to fill the vacancies created by these occurances.
(2) The John A. Carver Trust, of which Mr. Carver is a Trustee, holds a
first mortgage on unimproved land adjacent to the Lockformer facility.
The note calls for interest only payments through August 28, 1997 at
prime rate (per Wall Street Journal) plus 5 1/4%, however such rate
shall not be less than 11%, with principal due August 28, 1997.
4
<PAGE> 6
DIRECTORS' COMPENSATION
RETAINER AND FEES. The Company has a compensation policy whereby
directors who are not officers of the Company or its subsidiaries receive an
annual retainer. For the fiscal year ended May 31, 1996, the annual retainer
was $6,500. During the fiscal year ended May 31, 1996 Messrs. Moore, Jones,
Logan, Neal, Nonnenmann, and Carver received $4,000 of the retainer in cash.
In 1996, Messrs. Logan, Neal, Nonnenmann and Carver elected to receive $2,500
per year in the form of restricted Common Stock of the Company pursuant to the
Company's Restricted Stock Plan. Messrs. Carver and Moore received a 3 year
award consisting of 3,886 shares each of which 1,295 shares will vest this
year. Messrs. Neal, Logan and Nonnenmann are eligible to receive vested awards
of 781, 777 and 1,295 respectively. See "Restricted Stock Plan" below.
In addition, directors receive a fee of $1,000 for each Board meeting
attended, $500 for each Board committee meeting attended that is not held in
conjunction with a regularly scheduled Board meeting, $250 for each committee
meeting held in conjunction with a Board meeting, and expense reimbursement.
Directors who are also full time employees of the Company are not paid for
their services as directors or for attendance at meetings but are reimbursed
for their expenses.
RESTRICTED STOCK PLAN. This plan, pursuant to which 150,000 shares of
Common Stock have been reserved, provides for awards of Common Stock to
eligible directors who elect to receive such awards in lieu of their annual
cash retainer. Effective October 1, 1996, the Plan has been amended to allow
the directors to elect all stock in lieu of any cash retainer up to the maximum
of $6,500 per year. Persons who were members of the Board on the effective
date of the plan, or who initially take office during the term of the plan, and
who are not and have never been employees of the Company or any subsidiary, are
eligible to participate in the plan.
At the annual meeting held in October every year (the "Award Date"),
each director elected at the meeting who chooses to participate receives an
award ("Award") of shares of restricted Common Stock representing that number
of whole shares of the Company's Common Stock based upon the average last bid
and asked prices of the Common Stock for the most recent 20 consecutive trading
days immediately preceding the date of the Award. The aggregate value of these
awards may not exceed $19,500 (the $6,500 from the annual retainer that the
director has not elected to receive multiplied by the three years of the
award). Awards are made for a three-year period ("Award Cycle") and vest at the
rate of 33-1/3 percent on each anniversary date during the applicable Award
Cycle, subject to the participant being a director on such anniversary date.
Participants who are first elected to office subsequent to the Award Date and
who elect to participate, receive an Award upon the effective date of their
election which will be a prorated Award based upon the number of full months
remaining in the three-year cycle. Upon the full vesting of an Award, each
participant who continues to serve as a director of the Company and who chooses
to continue participation shall, subject to the plan remaining in effect,
receive an additional Award.
No shares of Common Stock awarded to participants under the Plan may
be sold, assigned, transferred, pledged or otherwise encumbered before they
vest. A participant forfeits all unpaid accumulated dividends and all shares
of Common Stock that have not vested prior to the date that his or her term as
a director of the Company expires or is terminated. Subject to the foregoing
restrictions, each participant has all the rights of a stockholder with respect
to the vested and non-vested Award shares, including, the right to vote the
shares and receive dividends.
5
<PAGE> 7
BOARD COMMITTEES
The Audit Committee of the Board of Directors held three meetings
during fiscal 1996. This committee is responsible for reviewing with the
Company's financial management and its independent auditors the proposed audit
program for each fiscal year, the results of the audits, and the adequacy of
the Company's systems of internal accounting control. The committee recommends
to the Board of Directors the appointment of the independent auditors for each
fiscal year. Director Moore is Chairman, and Directors Carver, Logan, Neal and
Nonnenmann are members of this committee.
The Compensation Committee of the Board of Directors held two meetings
during fiscal 1996. The committee is responsible for at least annually
reviewing and fixing the salaries and other compensation of the Company's
Chairman and Chief Executive Officer and for reviewing and acting upon
recommendations as to the compensation of other executive officers. The
committee also administers the Company's Incentive Bonus Plan, Stock Option
Plan, and considers alternative means of compensation for the Company's
employees. Director Logan is Chairman and Directors Carver, Neal, Nonnenmann
and Moore are members of this committee.
The Nominating Committee of the Board of Director's held two meetings
during fiscal 1996. The Nominating Committee is responsible for reviewing and
recommending members for election to the Board. The Committee will also
consider nominations by any stockholder entitled to vote for the election of
directors at the meeting who complies with the following: (a) such nomination
shall be made by timely notice in writing to the Secretary of the Company, (b)
to be timely, a stockholder's notice shall be delivered or mailed to and
received at the principal office of the Company not less than 30 days prior to
the date of the meeting is given or made to stockholders, (c) notice by the
stockholder to be timely must be so received not later than the close of
business on the 10th day following the day on which such notice of the date of
the meeting was mailed or such public disclosure was made, (d) the
stockholder's notice shall set forth (i) as to each person nominated for
election or re-election as a director, all information relating to such person
that is required to be disclosed in solicitations or proxies for election of
directors, or is otherwise required, in each case pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended (including such person's
written consent to being named in the proxy statement as a nominee and to
serving as a director if elected); and (ii) as to the stockholder giving the
notice (x) the name and address, as they appear on the Company's books, of such
stockholder and (y) the class and number of shares of the Company's capital
stock that are beneficially owned by such stockholder. At the request of the
Board of Directors, any person nominated by the Board of Directors for election
as a director shall furnish to the Secretary of the Company that information
required to be set forth in a stockholder's notice of nomination which pertains
to the nominee. No person shall be eligible for election as a director of the
Company unless nominated in accordance with the provisions contained herein.
The individual presiding at the meeting shall, if the facts so warrant,
determine and declare to the meeting that a nomination was not made in
accordance with such provisions and, if so determined, shall so declare to the
meeting and the defective nomination shall be disregarded. Director Neal is
Chairman and Directors Carver, Logan, Nonnenmann and Moore are members of this
committee.
The Board of Directors of the Company held five regular meetings
during fiscal 1996, some of which were combined with committee meetings and, in
addition, held various other meetings via telephone conference without fees.
Each director attended at least 75 percent of these meetings and at least 75
percent of the meetings held by all Board committees on which he served.
SECURITY OWNERSHIP OF DIRECTORS AND MANAGEMENT
The following table sets forth information regarding the Common Stock
of the Company (i) beneficially owned by each director, nominee and identified
executive officer as of August 23, 1996, and (ii) beneficially owned by all
directors and executive officers as a group as of that date.
6
<PAGE> 8
<TABLE>
<CAPTION>
Number of Shares
and Nature of
Beneficial Percent of
Name and Address of Beneficial Owner Ownership (1) Class
- ------------------------------------ ----------------- -------------
<S> <C> <C> <C>
Roy J. Carver Jr. 773,649 (2) 22.7%
Michael J. Nonnenmann 259,770 (2) 8.1%
Raymond H. Blakeman 154,438 (3) 4.9%
E. Keith Moore 24,263 (4) *
Gary M. Neal 8,673 (5) *
John F. Logan 18,331 (6) *
James D. Heitt 39,210 (7) *
All Directors & Executive Officers as a Group 1,246,921 (8) 39.2%
(9 individuals)
</TABLE>
(1) Nature of beneficial ownership is direct, and beneficial ownership
arises from sole voting and investment power, unless otherwise
indicated by footnote.
(2) See "Principal Shareholders" herein.
(3) Includes 19,000 shares subject to options exercisable by Mr. Blakeman,
a Director, Chairman and Chief Executive Officer, within 60 days.
Also includes 3,000 shares held by his spouse, with respect to which
Mr. Blakeman disclaims beneficial ownership. Also includes 11,077
shares allocated to his retirement accounts with respect to which Mr.
Blakeman has sole voting power.
(4) Includes 3,886 shares awarded to Mr. Moore as a participant in the
Company's Non-Employee Director Restricted Stock Plan, as to which Mr.
Moore has sole voting power. These 3,886 shares may not be sold or
assigned by Mr. Moore until they have vested. See "Directors'
Compensation-Restricted Stock Plan" herein. Also includes 7,500 shares
of common stock issuable upon conversion of 2,500 shares of preferred
stock held by Mr. Moore.
(5) Includes 781 shares awarded to Mr. Neal as a participant in the
Company's Non-Employee Director Restricted Stock Plan as to which Mr.
Neal has sole voting power. These 781 shares may not be sold or
assigned by Mr. Neal until they have vested. See "Directors
Compensation-Restricted Stock Plan" herein. Also includes 3,552 shares
of common stock issuable upon conversion of 1,184 shares of preferred
stock held by Mr. Neal.
(6) Includes 777 shares awarded to Mr. Logan as a participant in the
Company's Non-Employee Director Restricted Stock Plan, as to which Mr.
Logan has sole voting power. These 777 shares may not be sold or
assigned by Mr. Logan until they have vested. See "Directors'
Compensation-Restricted Stock Plan" herein. Also includes 15,000
shares of common stock issuable upon conversion of 5,000 shares of
preferred stock held by Mr. Logan.
(7) Includes 27,500 shares subject to options exercisable by Mr. Heitt
within 60 days. Also includes 10,767 shares allocated to his
retirement accounts with respect to which he has sole voting power.
(8) Includes 7,000 shares subject to options exercisable within 60 days,
in addition to the shares subject to options described in the Notes
above. Also, in addition to above, includes 8,185 shares allocated
to retirement accounts to which these individuals have sole voting
power.
* Ownership is less than 1% of the class.
7
<PAGE> 9
REPORT ON EXECUTIVE COMPENSATION
Following is the report on executive compensation from the
Compensation Committee of the Board of Directors of the Company (the
"Committee"). The Committee is composed of the five independent, non-employee
directors: Messrs. Logan (Committee Chairman), Carver, Neal, Nonnenmann, and
Moore.
EXECUTIVE COMPENSATION POLICY
It is the philosophy of the Company that executive compensation be
linked to corporate performance and shareholder value, and meet the following
objectives:
- To attract and retain high quality key employees.
- To align pay programs with annual and long-term strategy, and to
focus management on the attainment of those goals.
- To provide incentive compensation opportunities that link rewards
with achievement and that establish a mutuality of interest with
shareholders.
COMPENSATION PROGRAM COMPONENTS
The Committee regularly reviews the Company's pay programs to assure that
they are competitive with companies of similar size and complexity, that they
reflect Company performance, and that they recognize both team and individual
performance on a balanced basis. The Chief Executive Officer's input is
considered in establishing compensation programs, setting measures and goals,
and in making individual awards.
BASE COMPENSATION - Base compensation guidelines are determined through
market comparisons, especially with companies within the Company's industry.
Base pay levels are generally set around the median levels according to data
relied upon by the committee. Actual salaries are also based on individual
performance for each position. One of the guides utilized in this process is
the Association for Manufacturing Technology ("AMT") Annual Executive
Compensation Survey. AMT is comprised of private and public companies within
the machine tool industry. Some but not all of these companies are reflected
in the peer group utilized in the performance graph included herein.
ANNUAL INCENTIVE COMPENSATION - The Company's executive officers and senior
management are eligible to participate in an annual bonus plan with awards
based primarily on the attainment of written targets as to company sales,
operating profit and return on capital. The purpose of this plan is to provide
competitive rewards for the attainment of financial objectives that the
Committee believes will enhance share price over time. The plan primarily
focuses on consistent earnings growth. At the discretion of the Committee,
actual awards are subject to decrease or increase on the basis of the Company
or individual performance.
STOCK OPTIONS - The Committee believes that by providing persons having
substantial responsibility for the performance of the Company with an
opportunity for increased ownership of Company stock, the best interest of
shareholders and executives will be aligned. Therefore, executives are
eligible to receive stock options from time to time pursuant to the Company's
stock option plan. One executive officer was granted options for the period
ending May 31, 1996. See Options Granted Table herein.
CHIEF EXECUTIVE OFFICER COMPENSATION - Mr. Blakeman, Chairman of the Board
and Chief Executive Officer has a base compensation of $158,000. (which is
also set out elsewhere in this proxy). Mr. Blakeman's base pay was set in
accordance with the guidelines described above. There have been no bonus or
stock option grants to Mr. Blakeman during the three year period ending May 31,
1996.
8
<PAGE> 10
SUMMARY COMPENSATION TABLE
The following table sets forth all compensation paid or accrued by the
Company for services rendered in all capacities to the Company and its
subsidiaries for the fiscal years ended May 31, 1996, 1995, and 1994 by the
Chief Executive Officer and highly compensated executive officers of the
Company, other than the Chief Executive Officer whose total salary and bonus
exceed $100,000.
<TABLE>
<CAPTION>
Name & Principal Bonus All Other
Position Year Salary Cash & Stock Options (#) Compensation
- ---------------- ---- ------ -------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Raymond H. Blakeman(1) 1996 $131,667 --- --- --- $ 9,326 (1)
Chairman & CEO 1995 79,000 --- --- --- 7,521
1994 158,000 --- --- --- 17,858
Harold G. Spriggs 1996 86,667 --- --- --- 7,312 (2)
Vice Chairman & 1995 130,000 4,875 --- 20,000 10,270
Vice President 1994 135,833 --- --- --- 69,295
James D. Heitt 1996 136,500 --- --- 10,000 7,312 (3)
Vice President 1995 135,551 --- --- 25,000 10,332
1994 121,468 13,000 7,000 --- 6,084
Jacinto A. Rosa 1996 115,256 27,000 --- --- 1,110 (4)
Exec. V.P. Operations 1995 62,500 --- --- --- ---
K. John Del Vecchio 1996 32,500 --- --- --- 54 (5)
Vice President 1995 130,000 --- --- 20,000 11,299
1994 125,000 13,000 7,000 --- 5,449
</TABLE>
_____________
(1) Other compensation includes Company contributions to 401(k) and ESOP
retirement plans.
(2) In conjunction with the sale of certain operations of Rowe Machinery
and Automation effective February 5, 1996, Mr. Spriggs subsequently
resigned as an officer and director of the Company. Other
compensation includes Company contributions to 401(k) and ESOP
retirement plans. Prior years also include consulting fee. (See
"Employment Agreements" herein.)
(3) Other compensation includes Company contributions to 401(k) and ESOP
retirement plans.
(4) Effective September 15, 1996 Mr. Rosa resigned as an officer
and employee of the Company. Other compensation
includes Company contributions to 401(k) and ESOP retirement plans.
(5) Mr. Del Vecchio resigned as an employee effective August 31, 1995.
Other compensation includes Company contributions to 401(k) and ESOP
retirement plans.
EMPLOYMENT AGREEMENTS
In connection with the Company's December 30, 1986 acquisition of Rowe
Machinery and Automation, Inc. ("Rowe"), Rowe entered into an employment
agreement and a separate consulting agreement with Mr. Spriggs. The consulting
agreement commenced upon termination of the employment agreement in 1989 and
provided for annual consulting fees of $80,000 over its four year term which
was completed in December 1993.
9
<PAGE> 11
OPTIONS GRANTED
The following table details certain information concerning options
granted during fiscal 1996 to the named executives:
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation
Individual Grants for Option Term
- ------------------------------------------------------------------------------------ -----------------------
Number of % of Total
Securities Options/SARs
Underlying Granted To Exercise or
Options/SARs Employees in Base Price Expiration
Name Granted Fiscal Year ($/Share) Date 5% ($) 10% ($)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
James D. Heitt 10,000 100% 2 .00 8/10/2006 37,734 79,687
- -----------------------------------------------------------------------------------------------------------
</TABLE>
OPTIONS AT FISCAL YEAR END
The following table provides data for options of common stock held by the named
officers at May 31, 1996.
<TABLE>
<CAPTION>
Value of Unexercised
Number of Securities Underlying In-The-Money Options at
Unexercised Options at Fiscal Year End Fiscal Year End (1)
Name Exercisable / Unexercisable Exercisable / Unexercisable
----------- ----------------------------- ---------------------------
<S> <C> <C> <C> <C> <C>
Raymond H. Blakeman 19,000 / --- $ --- $/ ---
Harold G. Spriggs --- / --- --- / ---
James D. Heitt 27,500 / 20,000 1,250 / 3,750
K. John Del Vecchio --- / --- --- / ---
Jacinto A. Rosa 10,000 / 10,000 --- / ---
</TABLE>
(1) Total value of options based on closing price of Company stock as of
May 31, 1996 which was $2.50 .
10
<PAGE> 12
Corporate Performance Graph
The following graph reflects a five year comparison of cumulative
total shareholder return on the common stock of the Company, the NASDAQ Total
Return Index (U.S. companies), and the NASDAQ Industry Group Machine Tools
Index.
Prepared by the Center for Research in Security Prices Produced on 08/06/96
including data to 05/31/96
Company Index: CUSIP Ticker Class Sic Exchange
59085010 METS 3540 NASDAQ
Fiscal Year-end is 05/31/96
Market Index: NASDAQ Stocks (SIC 3540-3549 US Companies)
Metalworking Machinery and Equipment
<TABLE>
<CAPTION>
Date Company Index Market Index Fear Index
<S> <C> <C> <C>
05/31/91 100.000 100.000 100.000
06/28/91 200.000 93.909 99.367
07/31/91 237.500 99.469 107.049
08/30/91 162.500 104.415 107.157
09/30/91 87.500 104.799 116.241
10/31/91 112.500 108.263 108.197
11/29/91 150.000 104.629 106.303
12/31/91 112.500 117.411 124.073
01/31/92 150.000 124.276 156.900
02/28/92 250.000 127.091 174.293
03/31/92 262.500 121.093 157.744
04/30/92 206.250 115.900 155.397
05/29/92 200.000 117.405 172.488
06/30/92 187.500 112.815 170.525
07/31/92 187.500 116.812 177.406
08/31/92 193.750 113.241 155.166
09/30/92 162.500 117.450 148.438
10/30/92 125.000 122.076 150.921
11/30/92 200.000 131.789 177.862
12/31/92 150.000 136.641 195.277
01/29/93 162.500 140.530 204.198
02/26/93 200.000 135.288 206.877
03/31/93 225.000 139.203 208.860
04/30/93 200.000 133.262 177.292
05/28/93 412.500 141.223 189.402
06/30/93 375.000 141.876 178.129
07/30/93 400.000 142.043 165.069
08/31/93 300.000 149.385 185.904
09/30/93 325.000 153.834 185.817
10/29/93 337.500 157.291 186.188
11/30/93 325.000 152.600 186.840
12/31/93 300.000 156.854 203.329
01/31/94 275.000 161.615 210.784
02/28/94 250.000 160.104 201.296
03/31/94 275.000 150.257 204.037
04/29/94 300.000 148.307 198.247
05/31/94 250.000 148.669 180.593
06/30/94 262.500 143.232 149.559
07/29/94 275.000 146.170 156.310
08/31/94 306.250 155.488 169.038
09/30/94 312.500 155.091 171.082
10/31/94 350.000 158.139 159.899
11/30/94 312.500 152.894 146.274
12/30/94 312.500 153.323 154.983
01/31/95 318.750 154.182 159.426
02/28/95 287.500 162.336 174.149
03/31/95 300.000 167.146 181.121
04/28/95 312.500 172.409 186.968
05/31/95 275.000 176.858 185.205
06/30/95 275.000 191.189 187.857
07/31/95 162.500 205.236 186.874
08/31/95 193.750 209.388 193.968
09/29/95 193.750 214.204 194.289
10/31/95 175.000 212.981 181.229
11/30/95 150.000 217.976 179.273
12/29/95 100.000 216.809 185.687
01/31/96 112.500 217.871 176.504
02/29/96 175.000 226.177 189.754
03/29/96 175.000 226.916 202.277
04/30/96 162.500 245.744 215.598
05/31/96 250.000 257.051 214.933
</TABLE>
11
<PAGE> 13
PROPOSAL 2 - APPROVAL AND RATIFICATION OF APPOINTMENT
OF INDEPENDENT AUDITORS
The Board of Directors desires to obtain from the stockholders a
ratification of the Board's action in appointing Deloitte & Touche, LLP as
independent auditors for the fiscal year ending May 31, 1997.
Deloitte & Touche has been serving the Company since 1995. It has no
direct or indirect financial interest in the Company.
On October 8, 1996, prior to the annual meeting, the Audit Committee
is expected to recommend and the Board of Directors is expected to approve the
appointment of Deloitte & Touche as independent auditors. It is expected that
a representative of Deloitte & Touche will be present at the Annual Meeting to
respond to appropriate questions from stockholders and to make a statement if
he or she so desires.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING RESOLUTION
WHICH WILL BE PRESENTED AT THE MEETING:
"RESOLVED, the appointment by the Board of Directors of the Company of
Deloitte & Touche, LLP as independent auditors of the Company for the
fiscal year ending May 31, 1997 be and hereby is approved and
ratified."
In the event the resolution is not ratified, the adverse vote will be
considered a direction to the Board of Directors to select other auditors for
the following year. However, the appointment for the current year will be
permitted to stand unless the Board finds other good reasons for making a
change.
OTHER MATTERS
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be included in the Company's proxy
statement and form of proxy relating to, and to be presented at, the annual
meeting of stockholders of the Company to be held in 1997 must be received by
the Company on or before May 8, 1997.
OTHER BUSINESS
The Board of Directors knows of no other business that will be
presented at the Annual Meeting. Should any other business come before the
meeting, it is the intention of the persons named in the enclosed proxy form to
vote in accordance with their best judgment.
By Order of the Board of Directors,
Carroll Reasoner
Secretary
Cedar Rapids, Iowa
September 13, 1996
12
<PAGE> 14
MET-COIL SYSTEMS CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON OCTOBER 8, 1996
The undersigned hereby constitutes and appoints GARY NEAL, KEITH MOORE and
ROY CARVER, or any one or more of them, as Proxies, each with full power of
substitution, to vote for the undersigned all of the shares of Common Stock of
MET-COIL SYSTEMS CORPORATION registered in the name of the undersigned at the
annual meeting of stockholders of said corporation to be held October 8, 1996
and at any and all adjournments thereof, upon the following matter, which is
more fully described in the Proxy Statement:
1. The election of JOHN F. LOGAN AND MICHAEL J. NONNENMANN as directors
for a term of three years.
/ / FOR each nominee / / WITHHELD for each nominee
To withhold authority to vote for each individual nominee, strike a line
through the nominee's name.
2. To ratify the appointment of Deloitte & Touche, LLP as independent
auditors of the Company for the fiscal year ending May 31, 1997:
/ / FOR appointment / / AGAINST appointment / / ABSTAIN
3. The Proxies are authorized to vote in their discretion upon such other
matters as may properly come before the meeting. The Board of Directors
recommends a vote "FOR" Messrs. LOGAN and NONNENMANN and "FOR" the
appointment of DELOITTE & TOUCHE, LLP.
The right to revoke this proxy at any time before it is voted is reserved.
When properly executed, this proxy will be voted or withheld in accordance
with the specifications made herein. IF NOT OTHERWISE SPECIFIED, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF MESSRS. LOGAN and NONNENMANN and "FOR" THE
APPOINTMENT OF DELOITTE & TOUCHE, LLP.
PLEASE SIGN ON THE REVERSE SIDE
- ---------------------------------------------
(CONTINUED FROM REVERSE SIDE)
The powers hereby granted may be exercised by a majority of said Proxies
or their substitute present and acting at said annual meeting or any
adjournment thereof or, if only one be present and acting, then by that one.
The undersigned hereby revokes any and all proxies heretofore given by the
undersigned to vote at said meeting.
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
Signature:
-----------------------
Signature:
-----------------------
Dated and Signed: , 1996
--------
The signature to this proxy
should conform exactly to the
name as shown. When shares are
held by joint tenants, all such
tenants must sign. When signing
as an attorney, executor,
administrator, trustee or
guardian, give the title as
such. If signer is a
corporation, please sign full
corporate name by an authorized
officer and affix corporate
seal. If signer is a
partnership, please sign
partnership name by a general
partner or other authorized
person.
