<PAGE> 1
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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
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
PARK-OHIO INDUSTRIES, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF PERSON(S) FILING PROXY STATEMENT)
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).
/ / $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:
(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:
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<PAGE> 2
PARK-OHIO INDUSTRIES, INC.
23000 EUCLID AVENUE
EUCLID, OHIO 44117
NOTICE OF 1996 ANNUAL MEETING OF SHAREHOLDERS
Notice is hereby given that the 1996 annual meeting of shareholders of
Park-Ohio Industries, Inc., an Ohio corporation (the "Company"), will be held at
the Company's Auditorium, 23000 Euclid Avenue, Euclid, Ohio, on Thursday, May
23, 1996, at 4:00 P.M., Cleveland Time, for the following purposes:
1. To elect four directors, the names of whom are set forth in the
accompanying proxy statement, to serve for a term expiring at the annual
meeting of shareholders in 1998;
2. To consider and vote upon a proposal to approve the one time grant to
Mr. Crawford, Chairman and Chief Executive Officer, of a non-statutory
stock option to purchase 500,000 shares of Common Stock;
3. To consider and vote upon a proposal to approve the adoption of the
Company's 1996 Non-employee Director Stock Option Plan;
4. To consider and vote upon a proposal to ratify the appointment of Ernst
& Young LLP as the Company's independent auditors for 1996; and
5. To act on such other matters as may be properly brought before the
annual meeting or any adjournments, postponements or continuations
thereof.
Only shareholders of record at the close of business on April 10, 1996, are
entitled to notice of and to vote at the meeting.
All shareholders are invited to attend the annual meeting. To ensure your
representation at the annual meeting, however, you are urged to mark, sign and
return the enclosed proxy in the accompanying envelope, regardless of whether
you expect to attend the annual meeting. No postage is required if mailed in the
United States. Any shareholder attending the annual meeting may vote in person
even if such shareholder has returned a proxy.
By Order of the Board of Directors
RONALD J. COZEAN
Secretary and General Counsel
April 17, 1996
<PAGE> 3
PARK-OHIO INDUSTRIES, INC.
23000 EUCLID AVENUE
EUCLID, OHIO 44117
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board") of the Company to be voted at
the annual meeting of shareholders of the Company to be held at the Company's
Auditorium, 23000 Euclid Avenue, Euclid, Ohio, on Thursday, May 23, 1996, at
4:00 P.M., Cleveland Time, and any and all adjournments, postponements or
continuations thereof. This proxy statement and the accompanying proxy were
first mailed to shareholders on or about April 17, 1996. A shareholder giving a
proxy may revoke it, without affecting any vote previously taken, by a later
appointment received by the Company or by giving notice to the Company in
writing or in open meeting. Attendance at the meeting will not in itself revoke
a proxy. Shares represented by properly executed proxies will be voted at the
meeting. If a shareholder has specified how the proxy is to be voted with
respect to a matter listed on the proxy it will be voted in accordance with such
specifications, and if no specification is made the executed proxy will be voted
FOR the election of the nominees for directors and FOR the other proposals
listed on the proxy; provided, however, that if the election of directors is by
cumulative voting, the persons appointed by the accompanying proxy intend to
cumulate the votes represented by proxies they receive and distribute such votes
in accordance with their best judgment.
Under the General Corporation Law of Ohio, cumulative voting means that
each shareholder is entitled to a number of votes equal to the number of shares
owned by such shareholder multiplied by the number of directors to be elected.
Each shareholder may cast all of his or her votes for a single nominee or may
distribute his or her votes among as many nominees as he or she sees fit.
Shareholders will have cumulative voting if notice in writing is given by any
shareholder to the President or any Vice President or the Secretary of the
Company, not less than forty-eight hours before the time fixed for holding the
meeting, that the shareholder desires that the voting for election of directors
be cumulative, and if an announcement of the giving of such notice is made upon
the convening of the meeting. Such announcement may be made by the Chairman or
the Secretary of the Company or by or on behalf of the shareholder giving such
notice.
The record date for the determination of shareholders entitled to notice of
and to vote at the 1996 Annual Meeting is April 10, 1996. As of March 31, 1996,
there were issued and outstanding 10,969,331 shares of Common Stock of the
Company. Each share of Common Stock has one vote.
So far as the Company is aware, no matters other than those described in
this proxy statement will be presented to the meeting for action on the part of
the shareholders. If any other matters are properly brought before the meeting,
it is the intention of the persons named in the accompanying proxy to vote the
shares to which the proxy relates thereon in accordance with their best
judgment. Abstentions will be counted as present at the meeting for purposes of
determining a quorum and will not be counted as voting, except as otherwise
required by law and indicated herein.
1
<PAGE> 4
The cost of soliciting proxies, including the charges and expenses incurred
by persons holding shares in their name as nominee for the forwarding of proxy
materials to the beneficial owners of such shares, will be borne by the Company.
Proxies may be solicited by officers and employees of the Company, by letter, by
telephone or in person. Such individuals will not be additionally compensated
but may be reimbursed by the Company for reasonable out-of-pocket expenses
incurred in connection therewith. In addition, the Company has retained
Kissel-Blake Inc., a professional proxy soliciting firm, to assist in the
solicitation of proxies and will pay such firm a fee, estimated to be $6,000,
plus reimbursement of out-of-pocket expenses.
ELECTION OF DIRECTORS
The authorized number of directors of the Company is presently fixed at
seven, divided into two classes: three members and four members, respectively.
The directors in each class are elected for two-year terms so that the term of
office of one class of directors expires at each annual meeting. The terms of
office of Lewis E. Hatch, Jr., Thomas E. McGinty, Lawrence O. Selhorst, and
Richard S. Sheetz will expire on the day of the 1996 annual meeting, upon
election of successors.
The persons named in the accompanying proxy will vote the proxies received
by them (unless authority to vote is withheld) for the election of Messrs. Lewis
E. Hatch, Jr., Thomas E. McGinty, Lawrence O. Selhorst, and Richard S. Sheetz to
serve as directors for a two-year term and until their successors are elected
and qualify. All nominees currently serve as directors of the Company. If any
nominee is not available at the time of election, the proxy holders will vote in
their discretion for a substitute or for holding a vacancy to be filled by the
Board. The Company has no reason to believe any nominee will be unavailable.
RECOMMENDATION AND VOTE REQUIRED
The affirmative vote of a plurality of the shares of Common Stock
represented at the meeting is required to elect Lewis E. Hatch, Jr., Thomas E.
McGinty, Lawrence O. Selhorst, and Richard S. Sheetz as directors of the Company
to serve until the 1998 annual meeting of shareholders.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR LEWIS E. HATCH,
JR., THOMAS E. MCGINTY, LAWRENCE O. SELHORST, AND RICHARD S. SHEETZ AS
DIRECTORS.
2
<PAGE> 5
Information is set forth below regarding the nominees for election and the
directors who will continue in office after the meeting, including their ages,
principal occupations during the past five years and other directorships
presently held. Also set forth is the date each was first elected as a director
of the Company or a corporation that has been merged into the Company.
<TABLE>
<CAPTION>
NOMINEES FOR ELECTION YEAR
- - --------------------------------------------------------------------------------------------------- FIRST
PRINCIPAL OCCUPATION ELECTED TERM
NAME AGE AND OTHER DIRECTORSHIPS DIRECTOR EXPIRING
- - ---------------------- --- ------------------------------------------------------------------ -------- --------
<S> <C> <C> <C> <C>
Lewis E. Hatch, Jr.+# 69 Retired, Former Chairman and Chief Operating Officer, Rusch 1992 1998
International (international medical device company) from 1986 to
July 1992; Director, Teleflex, Incorporated since 1976
Thomas E. McGinty*+ 66 Former Interim Chairman of the Board and Chief Executive Officer 1986 1998
of the Company from November, 1991 to June, 1992; President,
Belvoir Consultants, Inc. (management consultants) since 1983
Lawrence O. Selhorst# 63 Chairman of the Board and Chief Executive Officer of American 1995 1998
Spring Wire Corporation (spring wire manufacturer) since 1968;
former Chairman of the Board of RB&W Corporation from September,
1992 to March, 1995; Director, Lincoln Electric Company
Richard S. Sheetz+ 71 Former Chairman of the Board and Chief Executive Officer of the 1964 1998
Company; Director, Cedar Fair Management Co. from 1987 to 1993;
Special General Partner, Cedar Fair, L.P.
</TABLE>
<TABLE>
<CAPTION>
DIRECTORS WHOSE TERMS OF OFFICE
WILL CONTINUE AFTER THE MEETING YEAR
- - --------------------------------------------------------------------------------------------------- FIRST
PRINCIPAL OCCUPATION ELECTED TERM
NAME AGE AND OTHER DIRECTORSHIPS DIRECTOR EXPIRING
- - ---------------------- --- ------------------------------------------------------------------ -------- --------
<S> <C> <C> <C> <C>
Edward F. Crawford* 56 Chairman and Chief Executive Officer of the Company since June 17, 1992 1997
1992; former Director of the Company from 1989 until 1991;
Chairman and Chief Executive Officer, Crawford Group, Inc.
(manufacturing businesses) since 1964; Director, Leaseway
Transportation Corp. since 1993
John J. Murray 40 President and Chief Operating Officer of the Company since January 1992 1997
1, 1995; President of KMR Industries, Inc. (business consulting
firm) since 1991; President and Chief Operating Officer, Rennoc
Corporation (manufacturing company) from 1989 to 1990
James W. Wert*# 49 Senior Executive Vice President and Chief Investment Officer, 1992 1997
KeyCorp (financial services company) since August, 1995; Chief
Financial Officer, KeyCorp from 1994 to 1995; Vice Chairman and
Chief Financial Officer, Society Corporation (financial services
company) from 1990 to 1994
- - ---------------
<FN>
*Member, Executive Committee
+Member, Audit Committee
#Member, Compensation and Stock Option Committee
</TABLE>
3
<PAGE> 6
BENEFICIAL OWNERSHIP OF SHARES
The following table, furnished as of March 31, 1996, sets forth certain
information with respect to beneficial ownership by each director, nominee, and
named executive officer individually, and by all directors and named executive
officers as a group of the Common Stock of the Company. Unless otherwise
indicated, the nature of beneficial ownership consists of sole voting and
investment power.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT
NATURE OF OF
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
----------------------------------------------------- -------------------- -------
<S> <C> <C>
Ronald J. Cozean..................................... 10,300(1) *
Edward F. Crawford................................... 2,903,000(2) 26.0%
Lewis E. Hatch, Jr................................... 20,060(3) *
Thomas E. McGinty.................................... 110,000 1.0%
John J. Murray....................................... 55,000(4) *
Lawrence O. Selhorst................................. 31,701 *
Richard S. Sheetz.................................... 75,340(5) *
James S. Walker...................................... 41,100(6) *
James W. Wert........................................ 16,000 *
All Directors and Officers as a group (9 persons).... 3,262,501 29.2%
- - ---------------
<FN>
* Less than 1%
(1) Includes 10,000 shares subject to stock options currently exercisable.
(2) Includes 8,500 shares owned by Mr. Crawford's wife as to which Mr. Crawford
disclaims beneficial ownership, 22,500 shares owned by L'Accent De Provence
over which Mr. Crawford shares voting and investment power, 100,000 shares
subject to stock options currently exercisable, and 562,500 shares held by
The Huntington Trust Company NA as escrow agent for the benefit of Mr.
Crawford over which Mr. Crawford has sole voting power.
(3) Includes 2,165 shares owned by Mr. Hatch's wife as to which Mr. Hatch
disclaims beneficial ownership.
(4) Includes 50,000 shares subject to stock options currently exercisable.
(5) Includes 942 shares owned by a family member as to which Mr. Sheetz
disclaims beneficial ownership.
(6) Includes 40,000 shares subject to stock options currently exercisable.
</TABLE>
4
<PAGE> 7
The following table, furnished as of March 31, 1996, sets forth certain
information concerning each person (or group of affiliated persons) who is known
to the Company to be the beneficial owner of more than 5% of its outstanding
Common Stock.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
TITLE OF NAME AND ADDRESS OF BENEFICIAL PERCENT
CLASS OF BENEFICIAL OWNER OWNERSHIP OF CLASS
- - ------------- ----------------------------------------------- ----------------- --------
<S> <C> <C> <C>
Common Stock Edward F. Crawford 2,903,000(1) 26.0%
26650 Lakeland Boulevard
Cleveland, Ohio 44132
Common Stock FMR Corp. 730,450(2) 6.5%
82 Devonshire Street
Boston, Massachusetts 02109
Common Stock Pioneering Management Corporation 955,600(3) 8.6%
60 State Street
Boston, Massachusetts 02109
- - ---------------
<FN>
(1) Based on information set forth on Amendment No. 3 to Schedule 13D dated May
5, 1995. The total includes 22,500 shares owned by L'Accent De Provence of
which Mr. Crawford is President and owner of 25% of its capital stock, 8,500
shares owned by Mr. Crawford's wife as to which Mr. Crawford disclaims
beneficial ownership, 100,000 shares subject to stock options currently
exercisable, and 562,500 shares held by The Huntington Trust Company NA over
which Mr. Crawford has sole voting power.
(2) Based on information set forth on Amendment No. 3 to Schedule 13G dated
February 14, 1996. FMR Corp. is a parent holding company. Fidelity
Management & Research Company, a wholly-owned subsidiary of FMR Corp. and an
investment adviser, is the beneficial owner of 570,790 shares as a result of
acting as investment adviser to several investment companies. Included in
the 570,790 shares are 103,520 shares which would be owned upon the
conversion of $2,000,000 principal amount of 7.25% Convertible Subordinated
Debentures. FMR Corp., through the control of its subsidiaries, has sole
power to dispose of the 570,790 shares. Power to vote these 570,790 shares
resides with the Boards of Trustees of the various funds. Fidelity
Management Trust Company, a wholly-owned subsidiary of FMR Corp. and a bank,
is the beneficial owner of 159,660 shares as a result of its serving as
investment manager of several institutional accounts. FMR Corp., through its
control of Fidelity Management Trust Company, has sole voting and
dispositive power over 149,460 shares of common stock and sole dispositive
power over 10,200 shares.
(3) Based on information set forth on Amendment No. 1 to Schedule 13G dated
January 26, 1996. Pioneering Management Corporation has sole voting power
and shared dispositive power over the 955,600 shares.
</TABLE>
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "Commission"). Officers, directors and greater than ten-percent
shareholders are required by Commission regulation to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company during 1995 and Forms 5 and amendments thereto
furnished to the Company with respect to 1995, no director, officer, beneficial
owner of more than 10% of its outstanding Common Stock or any other person
subject to
5
<PAGE> 8
Section 16 of the Exchange Act, failed to file on a timely basis since January
1, 1995, reports required by Section 16(a) of the Exchange Act during 1995.
CERTAIN MATTERS PERTAINING TO THE BOARD OF DIRECTORS
ORGANIZATION AND COMPENSATION OF THE BOARD OF DIRECTORS
During 1995, the Board held five meetings, the Audit Committee held two
meetings, the Compensation and Stock Option Committee (the "Compensation
Committee"), held one meeting and the Executive Committee held no meetings.
During 1995, each of the directors attended at least 75% of the meetings of the
Board and of any committee on which he served. During 1995, the Audit Committee
consisted of Messrs. Hatch, McGinty and Sheetz. In addition to its functions set
forth herein under the caption "APPOINTMENT OF INDEPENDENT AUDITORS," the Audit
Committee reviews the adequacy of the Company's internal accounting controls and
auditing procedures. During 1995, the Compensation Committee consisted of
Messrs. Hatch, Selhorst and Wert. In addition to its functions set forth herein
under "Stock Option Plan," the Compensation Committee recommends the
compensation arrangements for the Company's officers. The Executive Committee
consists of Messrs. Crawford, McGinty and Wert. The Executive Committee is
empowered to exercise the powers of the Board between meetings of the Board.
While there is no standing Nominating Committee, the Board selects nominees for
election as directors and considers the performance of directors in determining
whether to nominate them for re-election.
During 1995, each director, except Mr. Crawford and Mr. Murray, was paid an
annual retainer from the Company of $25,000. IF THE COMPANY'S 1996 NON-EMPLOYEE
DIRECTOR STOCK OPTION PLAN IS APPROVED, ANNUAL RETAINERS WILL NO LONGER BE PAID.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Hatch, Selhorst and Wert served as members of the Compensation and
Stock Option Committee of the Board during 1995. Messrs. Hatch, Selhorst and
Wert are not current or former officers or employees of the Company.
Mr. Wert is the Chief Investment Officer of KeyCorp, the parent of Society
National Bank ("Society"). As of December 31, 1995, the Company was indebted to
Society and four other banks in the amount of $94 million under a revolving
credit and term loan. Society is also the trustee and investment advisor for the
Company's Individual Account Retirement Plan and for two defined benefit plans
covering certain hourly employees. The Company maintains its checking accounts
at Society, and Society is the registrar and transfer agent for the Company's
Common Stock.
6
<PAGE> 9
EXECUTIVE COMPENSATION
INTRODUCTION
The following table sets forth the respective amounts of compensation of
the Chief Executive Officer and the other named executive officers of the
Company for each of the years 1993, 1994 and 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION> LONG-TERM
ANNUAL COMPENSATION COMPENSATION
-------------------------------- ------------
SECURITIES
UNDERLYING
NAME AND OPTIONS/ ALL OTHER
PRINCIPAL POSITION YEAR(1) SALARY($) BONUS($) SARs(#)(2) COMPENSATION($)(3)
- - ---------------------------- ------- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Edward F. Crawford
Chairman of the Board and
Chief Executive Officer... 1995 225,000 0 0 164
1994 225,000 0 0 181
1993 225,000 0 0 336
John J. Murray
President and
Chief Operating Officer... 1995 250,000 50,000 150,000 1,725
James S. Walker
Vice President and
Chief Financial Officer... 1995 140,000 25,000 10,000 3,464
1994 140,000 30,000 5,000 3,181
1993 140,000 0 15,000 3,136
Ronald J. Cozean
Secretary and
General Counsel........... 1995 90,000 20,000 10,000 1,464
1994 45,000 0 20,000 91
- - ---------------
<FN>
(1) Mr. Murray became President and Chief Operating Officer of the Company on
January 1, 1995. Mr. Cozean became Secretary and General Counsel of the
Company on July 1, 1994.
(2) Reflects the number of shares of Common Stock of the Company covered by
stock options granted during the years. No stock appreciation rights
("SARs") were granted to the named executives during the years shown.
(3) For the year ended December 31, 1995, All Other Compensation includes
contributions made by the Company under the Company's Individual Account
Retirement Plan as follows: Mr. Cozean, $1,300, and Mr. Walker, $3,300; and
taxable portion of benefits under life insurance program, as follows: Mr.
Cozean, $164, Mr. Crawford, $164, Mr. Murray, $1,725 and Mr. Walker, $164.
</TABLE>
STOCK OPTION PLAN
The Company has in effect an Amended and Restated 1992 Stock Option Plan
(the "Plan") that permits the granting of "non-statutory stock options" and
"incentive stock options." The Plan is administered by the Compensation and
Stock Option Committee of the Board of Directors, which has authority to select
officers and key employees to be participants and to determine the type and
number of awards to be granted.
The number of shares currently available for grant under the Plan shall not
exceed 850,000, subject to certain adjustments. The option price for stock
options granted under the Plan is fixed by the Committee, but in no event will
it be less than the fair market value of the Common Stock on the date of grant.
Options may be granted under the Plan at any time on or prior to February 18,
2002.
7
<PAGE> 10
The following tables set forth information regarding stock option
transactions with respect to the named executive officers during 1995.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN 1995
INDIVIDUAL GRANTS
--------------------------------------------------------
NUMBER % OF
OF TOTAL
SECURITIES OPTIONS/ POTENTIAL REALIZABLE VALUE AT
UNDERLYING SARS ASSUMED ANNUAL RATES OF STOCK
OPTIONS/ GRANTED TO PRICE APPRECIATION FOR OPTION
SARS EMPLOYEES EXERCISE OR TERM(3)
GRANTED(#) IN FISCAL BASE EXPIRATION -------------------------------
NAME (1) YEAR PRICE($/SH)(2) DATE 0%($) 5%($) 10%($)
- - ---------------------------- -------- ---------- -------------- --------- --- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Ronald J. Cozean 10,000 4.6% 10.625 3/28/05 0 66,800 169,300
Edward F. Crawford 0 0 N/A N/A 0 0 0
John J. Murray 150,000 68.3% 10.625 3/28/05 0 1,002,000 2,539,500
James S. Walker 10,000 4.6% 10.625 3/28/05 0 66,800 169,300
- - ---------------
<FN>
(1) Options become exercisable to the extent of 33 1/3% of the subject shares
after one year from the date of grant, 66 2/3% after two years from the date
of grant, and 100% after three years from the date of grant.
(2) Represents the NASDAQ closing price on the day prior to grant.
(3) The assumed rates of appreciation are not intended to represent either past
or future appreciation rates with respect to the Company's Common Stock. The
rates are prescribed in the applicable Commission rules for use by all
companies for the purpose of this table.
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN 1995
AND DECEMBER 31, 1995 OPTION/SAR VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARs AT OPTIONS/SARs AT
SHARES DECEMBER 31, 1995 DECEMBER 31, 1995
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE(1)
- - ---------------------------- ------------ --------- ----------------- -------------------
<S> <C> <C> <C> <C>
Ronald J. Cozean None N/A 6,667/ 23,333 $ 20,000/$ 95,000
Edward F. Crawford None N/A 100,000/ 0 $1,100,000/$ 0
John J. Murray None N/A 0/150,000 $ 0/$825,000
James S. Walker None N/A 36,667/ 18,333 $ 349,375/$ 98,750
- - ---------------
<FN>
(1) The "Value of Unexercised In-the-Money Options/SARs at December 31, 1995"
was calculated by determining the difference between the fair market value
of the underlying Common Stock at December 31, 1995 (the NASDAQ closing
price of the Company's Common Stock on December 29, 1995 was $16.125) and
the exercise price of the option. An option is "In-the-Money" when the fair
market value of the underlying Common Stock exceeds the exercise price of
the option.
</TABLE>
8
<PAGE> 11
REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE
Mr. Crawford, Chairman and Chief Executive Officer, Mr. Murray, President
and Chief Operating Officer, Mr. Walker, Chief Financial Officer and Mr. Cozean,
Secretary and General Counsel, are the named executive officers of the Company.
Messrs. Crawford, Murray, Walker and Cozean receive an annual salary and are
eligible to receive stock options under the Company's Amended and Restated 1992
Stock Option Plan. The Stock Option Plan is administered by the Compensation and
Stock Option Committee of the Board ("Committee") which is empowered to grant
options to purchase Common Stock of the Company to officers and key employees of
the Company and its subsidiaries. The Board believes stock options are an
effective incentive which links compensation to shareholder return.
Mr. Crawford's compensation was governed by the terms of an Employment
Agreement dated June 17, 1992 which expired on June 17, 1995. The Employment
Agreement provided for Mr. Crawford to receive an annual salary of $250,000.
Consistent with the Company's rigorous cost-cutting program, Mr. Crawford
voluntarily reduced his annual salary to $225,000 in 1993. Mr. Crawford did not
receive any stock options during 1995. In connection with the expiration of the
Employment Agreement, the Committee retained the services of Ernst & Young LLP
to review Mr. Crawford's compensation. Ernst & Young advised the Committee that
Mr. Crawford's current annual salary is significantly below that of chief
executive officers of companies similar in size to the Company.
The Committee approved, subject to shareholder approval, the grant of a
non-statutory stock option to purchase 500,000 shares of Common Stock. The
Committee chose to grant an option to Mr. Crawford rather than increase cash
compensation in order to (i) incent Mr. Crawford to devote his utmost effort and
skill to the betterment of the Company by allowing him to share in increases in
the value of the Company, (ii) comply with Mr. Crawford's preference to receive
stock-based compensation, and (iii) avoid the current expense of paying cash
compensation. Further the Committee determined that, in an entrepreneurial
company, it is appropriate to place a large portion of the CEO's compensation at
risk. Thus, unless the share price increases from the date of grant, Mr.
Crawford will receive no value from the option grant.
Mr. Murray's compensation is governed by the terms of an Employment
Agreement effective January 1, 1995. The Employment Agreement provides for (i)
an annual salary of $250,000, (ii) a one-time option grant to purchase 150,000
shares of Common Stock, and (iii) other benefits generally provided to executive
officers. Mr. Murray received a bonus of $50,000 during 1995.
Mr. Walker's compensation for 1995 principally consisted of an annual
salary of $140,000, which is identical to his salary for 1994, a bonus of
$25,000, and 10,000 stock options. Mr. Cozean's compensation for 1995
principally consisted of an annual salary of $90,000, a bonus of $20,000, and
10,000 stock options.
Mr. Crawford, based on his review of the performance of Mr. Walker and Mr.
Cozean, recommended that Mr. Walker and Mr. Cozean receive stock options in
accordance with the Company's Amended and Restated 1992 Stock Option Plan. Mr.
Crawford recommended bonuses for Messrs. Cozean, Murray and Walker particularly
for their efforts in connection with the Company's acquisition of RB&W
Corporation. The Committee accepted Mr. Crawford's recommendations and granted
the bonuses and options.
During 1995, the members of the Committee were:
Lewis E. Hatch, Jr.
Lawrence O. Selhorst
James W. Wert, Chairman
9
<PAGE> 12
PERFORMANCE COMPARISONS
The chart set forth below compares the cumulative total shareholder return
of the Company for the five years ended December 31, 1995 to (a) the Total
Return Index for the NASDAQ Stock Market (U.S. Companies), and (b) a group of
peer companies selected by the Company on the basis of similar business lines
and comparable market capitalization, number of employees, and total sales. In
all cases shown, the chart assumes the investment of $100 on December 29, 1990
and the reinvestment of all dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
PARK-OHIO, NASDAQ STOCK MARKET (U.S. COMPANIES) AND
SELF-DETERMINED PEER GROUP
<TABLE>
<CAPTION>
NASDAQ Stock
Measurement Period Market (U.S. Self-Determined
(Fiscal Year Covered) Park Ohio Companies (1) Peer Group (2)
<S> <C> <C> <C>
1990 100 100 100
1991 109 161 125
1992 182 187 182
1993 468 215 185
1994 468 210 171
1995 586 297 230
- - ---------------
<FN>
(1) The index is issued by the University of Chicago Graduate School of
Business, Center for Research in Security Prices.
(2) This peer group is comprised of ABS Industries Inc., Arden Industrial
Products, Inc., Gehl Company, Walbro Corporation, Essef Corporation,
Ameriwood Industries International Corporation, and Wyman Gordon
Corporation. Companies were chosen based on similarity of Standard
Industrial Classification codes and a combination of comparable market
capitalization, number of employees, and total sales. The returns of each
issuer have been weighted according to the respective company's stock market
capitalization. Market capitalization is determined by price times shares
outstanding at the close of the previous day. Mark Controls Corporation was
removed from the peer group because information is no longer available.
Arden Industrial Products, Inc. was added to the self-determined peer group
this year as a consequence of the Company's acquisition of RB&W Corporation,
but the addition had no material impact on the peer group results.
</TABLE>
10
<PAGE> 13
INFORMATION CONCERNING EXECUTIVE OFFICERS
EXECUTIVE AGREEMENTS
The Company entered into an employment agreement effective January 1, 1995
(the "Employment Agreement") with Mr. Murray in connection with Mr. Murray's
joining the Company as President and Chief Operating Officer. Pursuant to the
Employment Agreement, Mr. Murray is to be employed as President and Chief
Operating Officer of the Company at a rate of $250,000 per year of employment,
subject to discretionary increases by the Board. Mr. Murray is also entitled to
all benefits generally provided to Company executive officers. Mr. Murray was
granted a non-statutory stock option to purchase 150,000 shares of Common Stock.
The option will terminate on March 21, 2005, or the cessation of Mr. Murray's
employment with the Company, subject to provisions allowing for the conditional
exercise of the option upon such cessation of employment. In the event of a
"Change in Control of the Company," as defined in the option agreement, the
option will become exercisable in full (whether or not exercisable at such
time), and will remain exercisable until it expires pursuant to its terms.
Mr. Murray's employment can be terminated under the Employment Agreement
for death, incapacitating disability for at least six months, or for certain
specific causes. In the event of termination for cause or by death, Mr. Murray
shall receive only compensation earned and benefits accrued to the date of
termination, and no severance pay. In the event of voluntary resignation, Mr.
Murray shall receive a half of a year's salary as severance pay. In the event of
termination without cause or for disability, Mr. Murray shall receive severance
pay in the amount of one year's salary.
Mr. Murray agreed that during the term of his employment and at all times
thereafter, he will in no manner disclose any confidential information relating
to the Company or any of its affiliates or shareholders except as directed by
the Company. Mr. Murray also agreed to refrain for the term of his employment
and for one year thereafter, from certain acts of competition or solicitation.
RELATED TRANSACTIONS
General Aluminum Mfg. Company, a wholly-owned subsidiary of the Company,
leases space in two buildings in Conneaut, Ohio. GAMCO is leasing 70,000 square
feet of a facility owned by Mr. Crawford at a monthly rent of $9,000 and is
leasing a facility owned by Mrs. Crawford, consisting of 50,000 square feet, at
a monthly rent of $3,000.
The Company, through a wholly-owned subsidiary, purchased substantially all
of the assets of The Ajax Manufacturing Company ("Ajax") for $1.5 million
($1,500,000) on August 31, 1995. Mr. Crawford and his son own 100 percent of the
stock of Ajax. The non-employee directors approved the transaction after
receiving a fairness opinion from Lovemann-Curtis, Inc. In connection with the
acquisition, the Company's subsidiary entered into a lease agreement with
respect to the building owned by Ajax. The annual rent is $250,000. The Board of
Directors received an opinion from a Cleveland real estate company concerning
the fairness of the terms of the lease.
APPROVAL OF OPTIONS GRANTED TO CHAIRMAN
AND CHIEF EXECUTIVE OFFICER
As discussed more fully above in the "Report of the Compensation and Stock
Option Committee," the Compensation and Stock Option Committee of the Board
("Committee") reviewed with the assistance of
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<PAGE> 14
Ernst & Young LLP the compensation paid to Mr. Crawford, Chairman and Chief
Executive Officer in connection with the expiration of his employment agreement
on June 17, 1995. Having concluded that Mr. Crawford is currently paid
significantly less than chief executive officers of comparably sized companies,
the Committee granted on February 22, 1996, subject to shareholder approval, a
non-statutory stock option (the "Option") to purchase 500,000 shares of Common
Stock at $13.625 per share which was the fair market value as of that date. The
Option will vest in cumulative installments of 20 percent (100,000 shares) per
year, and will have a term of fifteen years. The Option will terminate on the
cessation of Mr. Crawford's employment with the Company, subject to provisions
allowing for the conditional exercise of the option upon such cessation of
employment. In the event of a "Change in Control of the Company," as defined in
the Option Agreement, the Option will become exercisable in full (whether or not
otherwise exercisable at such time), and will remain exercisable until it
expires pursuant to its terms. The foregoing is only a summary of the material
features of the Option Agreement. The full text of the Non-Statutory Stock
Option Agreement is attached as Appendix A, and the foregoing summary is
qualified in its entirety by reference to it. The closing price of a share of
Common Stock on the NASDAQ National Market on April 5, 1996 was $17.3875. For a
description of the federal income tax consequences of the issuance and exercise
of a non-statutory stock option, please refer to page 13.
RECOMMENDATION AND VOTE
The affirmative vote of the holders of a majority of the shares of Common
Stock present, or represented, and entitled to vote at the Annual Meeting is
required for the approval of the Option granted to Mr. Crawford. Abstentions may
be specified on the proposal and will be considered present at the Annual
Meeting, but will not be counted as affirmative votes. Abstentions, therefore,
will have the practical effect of voting against the proposal because the
affirmative vote of a majority of the shares present at the Annual Meeting with
respect to this matter is required to approve the proposal. Broker non-votes are
considered not present at the Annual Meeting with respect to this and,
therefore, will not be voted or have any effect on the proposal.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR APPROVAL OF THE OPTION
GRANTED TO MR. CRAWFORD.
APPROVAL OF THE 1996 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
At its February 22, 1996 meeting, the Board of Directors adopted, subject
to shareholder approval, the Company's 1996 Non-employee Director Stock Option
Plan (the "1996 Plan"). Options were granted at the meeting to non-employee
directors, pursuant to the 1996 Plan, subject to shareholder approval of the
1996 Plan.
The following is a summary of the material features of the 1996 Plan. The
full text of the 1996 Plan is attached as Appendix B, and the following summary
is qualified in its entirety by reference to it.
Purpose of the 1996 Plan. The purpose of the 1996 Plan is to advance the
interests of the Company and its shareholders by aligning the interests of
certain non-employee directors with both the success of the Company and the
financial interests of its shareholders by encouraging stock ownership in the
Company and thereby assuring that they have a proprietary interest in the
Company's business. The options granted under the 1996 Plan will not qualify as
Incentive Stock Options ("Non-Statutory Options"). IT IS THE INTENT OF THE BOARD
OF DIRECTORS TO ISSUE THESE NON-STATUTORY OPTIONS IN LIEU OF PROVIDING ANY CASH
COMPENSATION TO DIRECTORS.
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<PAGE> 15
Administration. The 1996 Plan shall be administered by the Compensation
and Stock Option Committee ("Committee"), composed of not less than two
directors appointed by the Board. The Board may also appoint one or more
directors as alternate members of the Committee, who may take the place of any
absent member or members at any meeting of the Committee. The members and
alternate members of the Committee shall, at all times during their service as
such, be "disinterested persons" within the meaning of Rule 16b-3(c)(2)(i)
promulgated under the Exchange Act. The Committee shall have full power to
construe and interpret the 1996 Plan, to establish rules for its administration
and to grant options under the 1996 Plan. A majority of the Committee shall
constitute a quorum, and the action of a majority of the members (including
alternate members) of the Committee present at any meeting at which a quorum is
present, or acts unanimously approved in writing by all members, shall be acts
of the Committee.
Shares. The aggregate number of shares of Common Stock of the Company
("Shares") for which options may be granted under the 1996 Plan shall not exceed
250,000, subject to such adjustment as the Compensation Committee, in its sole
discretion, may determine is equitably required as a result of any change in the
number or terms of Shares or of other securities into which Shares shall have
been changed or for which they shall have been exchanged. Eligible directors
will receive an annual option for 6,000 shares on the date of the Annual Meeting
of Shareholders, except for the original grant which will be on the date the
Board approves the 1996 Plan. The Shares to be issued upon exercise of options
granted under the 1996 Plan shall be made available, at the discretion of the
Board, from the authorized but unissued Shares or from Shares reacquired by the
Company, including Shares purchased in the open market. Any Shares for which an
option is granted hereunder which are released from such option for any reason
shall be available for other options under the 1996 Plan.
Eligibility and Transferability. Only non-employee directors are eligible
to participate in the 1996 Plan. There are currently five non-employee
directors. The number of persons receiving stock options may vary from year to
year. It is not possible to state in advance the exact number or identity of
such persons or the amount of such stock option grants. Except for limited
circumstances provided for in the 1996 Plan, no option shall be transferable by
the optionee, and options may be exercised during the employee's lifetime only
by him or her.
Option Price, Vesting and Exercise Period. The option price shall be 100
percent of the fair market value (as determined by the 1996 Plan) of the Shares
covered by the option at the time the option is granted. Options granted under
the 1996 Plan will vest six months after the date of grant. If a director
holding an option ceases to be a director (other than due to death or after
attainment of age 65), the period of exercise shall be six months from the date
on which he ceased to be a director, and will be one year in the event of death
or after attainment of age 65, but not later than the date of the expiration of
the option. No option granted under the 1996 Plan may be exercised later than 10
years after the date on which the option is granted. The closing price of the
Shares on the NASDAQ National Market on April 5, 1996 was $17.3875.
Payment. Upon the exercise of an option, payment of the option price may
be made in cash or Shares or a combination of cash and Shares.
Certain Federal Income Tax Consequences of Non-Statutory Options. Counsel
to the Company has advised that under current law the principal federal income
tax consequences to the 1996 Plan participants and the Company of Non-Statutory
Options granted under the 1996 Plan should be generally as set forth in the
following summary.
(a) No taxable income will result to a director upon the grant of a
Non-Statutory Option.
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<PAGE> 16
(b) Except as noted below, upon the exercise of a Non-Statutory Option by a
director, the director will recognize ordinary income in an amount equal to the
excess of the fair market value of the Shares at the date of exercise over the
option price. If payment of the option price is made by delivering Shares with a
fair market value equal to such option price, the director will realize ordinary
income in an amount equal to the fair market value of the "additional Shares"
received (i.e., the excess of the number of Shares received over the number
surrendered) less any cash paid on exercise of the option (which is the same
amount of ordinary income as if the option price were paid entirely in cash).
Such ordinary income is deductible by the Company on its tax return.
(c) On the subsequent sale of Shares, capital gain or loss will generally
be recognized in an amount equal to the difference between the tax basis thereof
and the amount realized on such sale, assuming the Shares are held as capital
assets. The tax basis of Shares acquired by a cash payment of the option price
and the tax basis of any "additional Shares" received where the option price is
paid by delivering Shares will be the fair market value thereof on the date of
exercise. The tax basis of the Shares received equal in number to those
surrendered where the option price is paid by delivering Shares will be the same
as that of the Shares surrendered. If the Shares are held for more than one
year, any such gain or loss will be treated as long-term capital gain or loss.
The discussion set forth above with respect to Non-Statutory Options does
not purport to be a complete analysis of all potential tax effects relevant to
the recipients of options or the Company. It is based on federal tax law and
interpretational authorities as of the date of this Proxy Statement, which are
subject to change at any time.
Option Agreement. The option agreement in which option rights are granted
to an employee shall be in the applicable form (consistent with the 1996 Plan)
from time to time approved by the Compensation Committee and shall be signed on
behalf of the Company by an officer of the Company, and shall be dated as of the
date of the granting of the option.
Amendment of 1996 Plan. The Board shall have the right to amend, modify,
suspend or terminate the 1996 Plan at any time; provided, however, that no such
action shall, without the consent of any optionee, affect or in any way impair
the rights of such optionee under any option theretofore granted under the 1996
Plan. In addition, no amendment or change shall be made in the 1996 Plan,
without further shareholder approval, (a) increasing the total number of Shares
as to which options may be granted under the 1992 Plan; (b) changing the minimum
option price hereinbefore specified for the optioned Shares or otherwise
materially increasing the benefits accruing to participants under the 1992 Plan;
or (c) extend the period during which options may be exercised. Notwithstanding
any other provision hereof, no action may be taken by the Company which will
impair the validity of any option then outstanding.
Expiration of 1996 Plan. Options may be granted under the 1996 Plan at any
time on or prior to May 31, 2001, on which date the 1996 Plan shall expire but
without affecting any options then outstanding.
RECOMMENDATION AND VOTE
The affirmative vote of the holders of a majority of the shares of Common
Stock present or represented, and entitled to vote at the Annual Meeting is
required for the approval of the 1996 Non-employee Director Stock Option Plan.
Abstentions may be specified on the proposal and will be considered present at
the Annual Meeting, but will not be counted as affirmative votes. Abstentions,
therefore, will have the practical effect of voting against the proposal because
the affirmative vote of a majority of the shares present at the Annual
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<PAGE> 17
Meeting with respect to this matter is required to approve the proposal. Broker
non-votes are considered not present at the Annual Meeting with respect to this
and, therefore, will not be voted or have any effect on the proposal.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR APPROVAL OF THE 1996
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN.
APPOINTMENT OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders, Ernst & Young LLP has been
appointed as the independent auditors for the Company for the year 1996.
The appointment of independent auditors is approved annually by the Board
and subsequently submitted to the shareholders for ratification. The decision by
the Board is based on the recommendation of the Audit Committee. In making its
recommendation, the Audit Committee reviewed both the audit scope and estimated
fees for the audit of the 1995 financial statements.
Representatives of Ernst & Young LLP will attend the Annual Meeting, will
have an opportunity to make a statement, if they so desire, and will be
available to respond to appropriate shareholders' questions.
The favorable vote of a majority of the shares voting on this proposal is
required for ratification of this appointment. The persons named in the
accompanying proxy intend to vote proxies received by them in favor of this
proposal unless a choice "Against" or "Abstain" is specified.
SHAREHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Any shareholder who intends to present a proposal at the 1997 annual
meeting and who wishes to have the proposal included in the Company's proxy
statement and form of proxy for that meeting must, in addition to complying with
the applicable laws and regulations governing the submission of such proposals,
deliver the proposal to the Company for consideration not later than December
12, 1996.
ANNUAL REPORT
The Annual Report for the year 1995 has been mailed to shareholders.
Additional copies may be obtained from the undersigned.
PARK-OHIO INDUSTRIES, INC.
RONALD J. COZEAN
Secretary and General Counsel
April 17, 1996
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<PAGE> 18
APPENDIX A
PARK-OHIO INDUSTRIES, INC.
NON-STATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT, dated this 22nd day of February, 1996 (being the date this
option is granted) by and between Park-Ohio Industries, Inc., an Ohio
corporation, (the "Company") and Edward F. Crawford (the "Employee"), Chairman
and Chief Executive Officer of the Company.
Section 1. The Company hereby grants to the Employee, subject to
shareholder approval at the next annual meeting of shareholders, the option of
purchasing an aggregate of 500,000 shares of Common Stock of the Company at the
price of $13.625 per share, subject to the terms and conditions of this
Agreement.
Section 2. The option rights are exercisable only if and after the
Employee shall have remained in the employ of the Company for one year from the
date this option is granted, whereupon such rights shall become exercisable to
the extent of 20% of the aggregate number of shares above specified. Thereafter,
the rights shall become exercisable to the extent of (i) 40% of the aggregate
number of shares above specified on and after two years from the date hereof,
(ii) 60% of the aggregate number of shares above specified on and after three
years from the date hereof, (iii) 80% of the aggregate number of shares above
specified on and after four years from the date hereof, and (iv) 100% of the
aggregate number of shares above specified on and after five years from the date
hereof.
Section 3. This option is exercisable, during the lifetime of the
Employee, only by him or his guardian or legal representative. The Employee's
option rights and interests herein (including the right to exercise unexercised
options) may not be assigned or transferred except that, (i) in the case of the
Employee's death, such options, and other rights and interests, shall be
transferable to the person or persons to whom the option shall have been
transferred by will or the laws of descent and distribution, (ii) the Employee's
option, and other rights and interests, may be transferred to (I) any trust or
estate in which the original holder (or such holder's spouse or other immediate
relative) has a substantial beneficial interest or (II) a spouse or other
immediate relative of the original holder, and (iii) the Employee's options, and
other rights and interests, may be transferred pursuant to a qualified domestic
relations order (as defined in the Tax Code). The option so transferred shall
continue to be subject to all the terms and conditions contained in this
Agreement. Except as otherwise provided in Sections 5, 6 and 9, this option can
be exercised only if the Employee has remained in the employ of the Company
continuously from the date this option is granted.
Section 4. Notwithstanding any other provision hereof, this option shall
not be exercisable after the expiration of fifteen years from the date this
option is granted, or upon such earlier date as provided in Sections 5, 6 and
9(a).
Section 5.
(a) If the Employee shall cease to be employed by the Company by reason of
retirement in accordance with any retirement plan or policy of the Company then
in effect, then the Employee, at any time within the three-month period
following such cessation of employment (but within the fifteen-year period
specified in Section 4), may exercise the option rights to the full extent not
previously exercised, notwithstanding the provisions of Section 2.
(b) If, at any time after the expiration of one year from the date this
option is granted, the Employee shall cease to be employed by the Company by a
reason other than the retirement in accordance with any
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<PAGE> 19
retirement plan or policy of the Company then in effect, the Employee, at any
time within the one-month period following such cessation of employment (but
within the fifteen-year period specified in Section 4) may exercise the option
rights to the extent he was entitled to exercise the same immediately prior to
such cessation of employment.
Section 6. If, at any time after the expiration of one year from the date
this option is granted, the Employee shall die while in the employ of the
Company or he shall die within the three-month period available to him to
exercise his option rights under the circumstances provided for in Section 5,
then within the six months next succeeding his death (but within the
fifteen-year period specified in Section 4), the person entitled by transfer,
will or the applicable laws of descent and distribution may exercise the option
rights to the extent that the Employee was entitled to exercise the same
immediately prior to his death.
Section 7. In consideration of the granting of this option, the Employee
agrees to remain in the employ of the Company for a period of not less than one
year from the date this option is granted, unless during said period his
employment shall be terminated on account of incapacity or by the Company.
Nothing herein contained shall limit or restrict any right which the Company
would otherwise have to terminate the employment of the Employee with or without
cause or to adjust his compensation.
Section 8. Subject to the provisions of Section 9(a) of this Agreement, in
the event that, during the term hereof and while the option as to any of the
shares covered hereby shall remain unexercised, each of the outstanding shares
of Common Stock of the Company (except shares held by dissenting stockholders)
shall be changed into or exchanged for a different number or kind of shares of
stock or other securities of the Company or of another corporation, or for other
property, whether through reorganization, recapitalization, stock split,
combination of shares, merger or consolidation, or the Company shall issue a
stock dividend, then the Employee, upon the subsequent exercise of his option to
purchase shares hereunder, shall be entitled to receive, in addition to or in
place of the shares specified in this Agreement as to which the option is then
being exercised, but without additional cost, the shares and other securities or
property which he would have held at the time of such exercise pursuant to all
such changes, exchanges and stock dividends as if on the date of this Agreement
he had been the record holder of the number of shares of Common Stock as to
which this option is then being exercised and as if he had continuously
thereafter retained said shares and/or all other shares and securities which
would have been distributed in respect of or in lieu of said shares; provided
that no fractional shares shall be issued under these provisions; and provided
further that if in the opinion of the Compensation and Stock Option Committee
the circumstances prevailing at the time of the exercise of the option rights
make it impracticable to substitute or add other shares, securities, or property
to the complete extent as above provided for, the Committee, at the time of the
exercise of option rights, shall make such substitutions and adjustments so far
as, in the opinion of counsel for the Committee (who may be counsel for the
Company) are equitable and practicable at the time.
Section 9.
(a) If the Company shall liquidate or dissolve, or shall be a party to a
merger or consolidation with respect to which it shall not be the surviving
corporation, the Company shall give written notice thereof to the Employee at
least thirty days prior thereto, and notwithstanding the provisions of Section
2, the Employee shall have the right within said thirty-day period (but within
the fifteen-year period specified in Section 4) to exercise this option in full
to the extent not previously exercised. To the extent that this option shall not
have been exercised on or prior to the effective date of such liquidation,
dissolution, merger or consolidation, it shall terminate on said date, unless it
is assumed by another corporation.
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(b) Notwithstanding the provisions of Section 2, the option granted hereby
shall become exercisable in full to the extent not previously exercised upon the
occurrence of any Change in Control of the Company. For purposes of this
Agreement, a "Change in Control of the Company" (assuming such event has not
been previously reported) shall mean a change in control of a nature that would
be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended
("Exchange Act"); provided, without limitation, that a Change in Control of the
Company shall be deemed to have occurred if and at such times as (i) any
"person" within the meaning of Section 14(d) of the Exchange Act) becomes the
beneficial owner, directly or indirectly, of securities of the Company
representing 34% or more of the combined voting power of the Company's then
outstanding securities, or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute at least a majority thereof unless the election, or the
nomination for election by the Company's shareholders, of each new director was
approved by a vote of at least two-thirds of the directors then still in office
who were directors at the beginning of the period.
Section 10. Subject to the terms and conditions hereof, this option may be
exercised by delivering to the Company at the office of its Treasurer a written
notice, signed by the person entitled to exercise the option, of the election
and stating the number of shares such person then elects to purchase. Such
notice shall be accompanied by the payment in full of the purchase price of the
shares then to be purchased. Payment of the full option exercise price may be
made, at the election of the Optionee (a) in cash, (b) in Common Stock of the
Company, or (c) in any combination of cash and Common Stock of the Company.
Common Stock of the Company used in payment of the purchase price shall be
valued at its closing bid price on NASDAQ on the trading day immediately
preceding the date of exercise. The Employee agrees to pay in cash, within the
time period specified by the Company, the amount (if any) required to be
withheld for federal, state or local tax purposes on account of the exercise of
the option or to make such arrangements to satisfy such withholding requirements
as the Company deems appropriate. In the event the option is exercised by any
person other than the Employee, evidence satisfactory to the Company that such
person has the right to exercise the option must accompany such notice and
payment. Subject to the right of the Company to postpone the date upon which
exercise of this option becomes effective, as provided in Section 11 hereof,
upon the due exercise of the option as hereinbefore provided, the Company shall
issue in the name of the person exercising the option, and deliver to him, a
certificate or certificates for the shares in respect of which the option shall
have been so exercised. The Employee agrees neither he nor any other holder of
this option shall have any rights as a stockholder or otherwise in respect of
any of the shares as to which the option shall not have been effectively
exercised as provided herein.
Section 11. This option shall not be exercisable if such exercise would
violate:
(a) Any applicable state securities law;
(b) Any applicable registration or other requirements under the
Securities Act of 1933, as amended ("Securities Act"), Exchange Act, or the
listing requirements of any stock exchange; or
(c) Any applicable legal requirement of any other governmental
authority.
The Company agrees to make reasonable efforts to comply with the foregoing
laws and requirements so as to permit the exercise of this option. Furthermore,
if a Registration Statement with respect to the shares to be issued upon the
exercise of this option is not in effect or if counsel for the Company deems it
necessary or desirable in order to avoid possible violation of the Securities
Act, the Company may require, as a condition to its issuance and delivery of
certificates for the shares, the delivery to the Company of a commitment in
writing by the person exercising the option that at the time of such exercise it
is his intention to acquire such shares
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<PAGE> 21
for his own account for investment only and not with a view to, or for resale in
connection with, the distribution thereof; that such person understands the
shares may be "restricted securities" as defined in Rule 144 of the Securities
and Exchange Commission; and that any resale, transfer or other disposition of
said shares will be accomplished only in compliance with Rule 144, the
Securities Act, or the other Rules and Regulations thereunder. The Company may
place on the certificates evidencing such shares an appropriate legend
reflecting the aforesaid commitment and may refuse to permit transfer of such
certificates until it has been furnished evidence satisfactory to it that no
violation of the Securities Act or the Rules and Regulations thereunder would be
involved in such transfer.
Section 12. References herein to the Company shall include all parents and
subsidiaries of the Company, determined consistently with the definitions of
parent and subsidiary in Section 424 of the Internal Revenue Code of 1986 and
the relevant Treasury Department Regulations.
Section 13. BY EXECUTING AND DELIVERING THIS AGREEMENT, THE EMPLOYEE
ACKNOWLEDGES AND AGREES THAT, AS IN THE PAST, HE IS AN EMPLOYEE AT WILL OF THE
COMPANY.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
duplicate as of the day and year first-above written.
PARK-OHIO INDUSTRIES, INC.
By: /s/ John J. Murray
--------------------------------------
John J. Murray, President
/s/ Edward F. Crawford
--------------------------------------
Edward F. Crawford
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<PAGE> 22
APPENDIX B
PARK-OHIO INDUSTRIES, INC.
1996 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. PURPOSES
The purposes of the Park-Ohio Industries, Inc. 1996 Non-employee Director
Stock Option Plan (the "Plan") are to promote the interests of Park-Ohio
Industries, Inc. (the "Company") and its subsidiaries by providing an incentive
to attract and retain qualified directors for the board of the Company based
upon the success and growth of the Company and its subsidiaries and by
furthering the identity of interests of the directors and the stockholders of
the Company.
2. SHARES SUBJECT TO THE PLAN
The maximum aggregate number of shares as to which stock options may at any
time be granted under the Plan (the "Options") shall be two hundred fifty
thousand (250,000) shares of the Company's common stock, par value $1.00 per
share (the "Common Stock"), subject to adjustment in accordance with Section 10.
Common Stock issued upon exercise of Options may be either authorized but
unissued shares or shares previously issued and reacquired by the Company. If
and to the extent Options terminate, expire or are cancelled without having been
exercised, the shares subject to such Options shall again be available for
purposes of, and may be optioned under, the Plan. All Options shall be
"nonqualified" under and for purposes of the Internal Revenue Code of 1986, as
amended ("Tax Code").
3. ELIGIBILITY FOR PARTICIPATION
Any member of the Company's Board of Directors ("Board") who is not an
employee of the Company or any of its subsidiaries shall be eligible to
participate in the Plan. Nothing contained in the Plan shall be construed to
limit the right of the Company to grant options to purchase its Common Stock
otherwise than under the Plan or to grant a particular person more than one
Option.
4. GRANTING OF OPTIONS
(a) Each director of the Company who is eligible to participate in this
Plan on the date of the Annual Meeting of Shareholders of any year, that is
whose term of office will continue for at least the year following such Annual
Meeting, shall be granted an Option as of such date, with the number of shares
of Common Stock subject to such Option to be equal to 6,000. Each Option shall
have an exercise price per share equal to the average Fair Market Value per
share of Common Stock for the five (5) trading days immediately preceding the
date as of which such Option is granted. Each Option grant to each director
shall be in lieu of any and all retainer fees (and meeting fees) otherwise
payable to the director for his service as such and/or on any committees of the
Board for the 12 month period beginning on the date of the Annual Meeting of
Shareholders as of which the Option is granted. Except as otherwise provided
herein, all Options granted pursuant to the Plan shall become exercisable six
months after the date of grant.
(b) For purposes of the Plan, the Fair Market Value of a share of Common
Stock as of any trading day shall be the reported closing price for a share of
Common Stock on the NASDAQ National Market.
20
<PAGE> 23
5. TERM OF OPTIONS
Except as provided in Section 7, Options granted hereunder shall be
exercisable for a term of ten years from the date of grant (the "Expiration
Date"). Notwithstanding anything to the contrary contained herein, no Option
shall be exercisable earlier than six months after its date of grant.
6. EXERCISE OF OPTIONS
(a) The exercise price of the shares as to which an Option shall be
exercised shall be paid in full at the time of exercise in cash or Common Stock
(valued at its Fair Market Value at the date of exercise) or a combination of
cash and Common Stock.
(b) Except as provided in Section 7, no Option may be exercised at any time
unless the holder thereof is then a director of the Company and has continuously
remained a director of the Company at all times since the date of grant of such
Option.
(c) Options shall be exercised by the holder thereof giving written notice
of such exercise to the Company. An Option may be exercised only with respect to
a whole number of shares of Common Stock. Subject to the other provisions
hereof, Options may be exercised at any time and in any order. Also subject to
the other provisions hereof, subsequent to the death of a director or former
director, any Options held by such decedent may be exercised by his personal
representative or the person or persons to whom said Option shall have been
transferred, as permitted hereunder.
(d) An Option shall be exercisable during a director's or former director's
lifetime only by the director or former director, the director's transferee, as
permitted hereunder, or, if the director or former director has become disabled,
by his legal representative.
7. EXERCISE ON TERMINATION OF EMPLOYMENT
(a) Except as otherwise provided herein, if a director to whom an Option
has been granted ceases to be a member of the Board (otherwise than as a result
of his death or after attainment of age 65), such Option may be exercised at any
time within six (6) months after the date on which he ceased to be a director;
provided, that in no event shall any Option be exercisable for a period of six
months from the date of grant.
(b) If a director to whom an Option has been granted dies while a member of
the Board or, notwithstanding Section 7(a), within six (6) months after he
ceases to be a member of the Board, or ceases to be a member of the Board after
attainment of age 65, such Option may be exercised at any time within one (1)
year after the later of the date of the director's death or the date after
attainment of age 65 that the director ceased to be a Board member, as the case
may be; provided, that in no event shall any Option be exercisable for a period
of six months from the date of grant.
(c) Notwithstanding anything to the contrary herein contained, if a
director resigns his directorship and such resignation is effective prior to his
attainment of age 65, any Option granted to him within six months prior to the
effective date of such resignation shall terminate as of the effective date of
such resignation. Moreover, at such other time as the right of any Option holder
to exercise an Option terminates, such Option, to the extent not theretofore
exercised, shall terminate.
(d) Notwithstanding anything to the contrary herein contained, in no event
shall any Option be exercisable after its Expiration Date.
21
<PAGE> 24
8. CONFIDENTIALITY/NONSOLICITATION
Each director accepting an Option covenants and agrees that he will not,
while a director of Company or at any time thereafter, disclose, duplicate,
distribute or use any Confidential Information, other than on behalf and for the
benefit of Park-Ohio. The foregoing agreement shall not be construed as
superseding or abridging any other stricter requirements or greater restrictions
with respect to the subject matter thereof that may also be applicable to such
director. The obligations contained in this Section 8 are, and constitute,
separate and several obligations of each such director, and such obligations
shall not be affected by, but rather shall survive, any termination of the Plan
and/or any exercise or termination of any Option. For purposes of this Section
8:
(a) "Confidential Information" means customer lists, rating formulae,
rate sheets, trade secrets, market studies, financial data and projections,
analyses, strategic plans and other documents, material and/or information,
whether or not in writing, acquired by a director of the Company as a
result of such director's service as such, which are (a) not totally within
the public domain and (b) such that a reasonable, prudent businessman would
not voluntarily relinquish, disseminate or communicate same to an actual or
potential competitor, customer or supplier.
(b) "Park-Ohio" includes the Company and also includes any other
entity in which the Company owns, whether directly or indirectly, fifty
percent (50%) or more of the stock and/or assets.
Notwithstanding any other provision of the Plan, any and all unexercised
Options and all rights under the Plan of a director or former director who
received an Option (or his legal transferee, designated beneficiary or legal
representatives) including the right to exercise the unexercised Options, shall
be forfeited if, prior to the time of such exercise, the director or former
director shall violate any of the agreements and covenants contained in this
Section 8.
9. NON-TRANSFERABILITY OF OPTIONS
A holder's Options and other rights and interests under the Plan (including
the right to exercise unexercised Options) may not be assigned or transferred
except that, (i) in the case of a holder's death, such Options, and other rights
and interests, shall be transferable to the person or persons to whom the Option
shall have been transferred by will or the laws of descent and distribution,
(ii) a holder's Options, and other rights and interests, may be transferred to
(I) any trust or estate in which the original holder (or such holder's spouse or
other immediate relative) has a substantial beneficial interest or (II) a spouse
or other immediate relative of the original holder, and (iii) a holder's
Options, and other rights and interests, may be transferred pursuant to a
qualified domestic relations order (as defined in the Tax Code). Any Option so
transferred shall continue to be subject to all the terms and conditions
contained in this Plan or any written agreement, pursuant to Section 14.
10. ADJUSTMENTS FOR CERTAIN EVENTS
In the event of a stock dividend, recapitalization, merger, consolidation,
split-up, combination or any other change in shares of Common Stock of the
Company, the Common Stock available for purposes of the Plan or subject to
Options outstanding hereunder shall be correspondingly increased, diminished or
changed, so that by exercise of any outstanding Option, the holder of the Option
shall receive, without change in aggregate purchase price, securities, as so
increased, diminished or changed, comparable to the number of shares of Common
Stock he would have received if he had exercised his Option prior to such event
and had continued to hold the Common Stock so purchased until affected by such
event.
22
<PAGE> 25
11. AMENDMENT AND TERMINATION
The Plan shall terminate on December 31, 2001 and no Options shall be
granted hereunder after such date. The Board may at any time and from time to
time terminate, modify or amend the Plan; provided, however, that unless also
approved or ratified by a vote of the holders of the outstanding shares of the
capital stock of the Company in accordance with the requirements of paragraph
(b) of Rule 16b-3, any such modification or amendment shall not (subject,
however, to the provisions of Section 10): (a) increase the maximum amount of
Common Stock for which Options may be granted under the Plan; (b) reduce the
Option exercise price at which Options may be granted; (c) extend the period
during which Options may be exercised beyond the times originally prescribed;
(d) materially modify the requirements as to eligibility for participation in
the Plan; or (e) materially increase the benefits accruing to Participants under
the Plan; provided, further, that the Plan provisions may not be amended more
than once every six months, other than to comport with changes in the Tax Code,
the Employee Retirement Income Security Act of 1974, as amended, or in either
case the rules thereunder. No such termination, modification or amendment may
diminish, limit or other wise impair the rights of a holder of an outstanding
Option. Nevertheless, with the consent of the holder affected, any such action
may be taken and outstanding Options may be amended in a manner not inconsistent
with the terms of the Plan.
12. RIGHTS OF AN OPTION HOLDER
Neither the Plan nor any action taken hereunder shall be construed as
giving any director any right to be retained as a director of the Company or
restrict the right to terminate his Board membership.
13. RIGHTS AS A STOCKHOLDER
A holder of an Option shall have no rights as a stockholder with respect to
any Common Stock covered by an Option until he shall have become the holder of
record of such Common Stock, and, except as provided in Section 10 hereof, no
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights in respect
of such share for which the record date is prior to the date on which he shall
become the holder of record thereof.
14. AGREEMENTS WITH OPTION HOLDERS
Each Option granted under the Plan shall be evidenced by a written
agreement executed by an officer of the Company and the optionee and containing
such terms and conditions not inconsistent with the Plan as may be prescribed by
the officer executing the same.
15. REQUIREMENTS FOR ISSUANCE OF SHARES
The Company shall have the right to condition the issuance of Common Stock
to any holder of an Option upon exercise thereof on such holder's undertaking in
writing to comply with such restrictions on his subsequent disposition of such
Common Stock as the Company shall deem necessary or advisable as a result of any
applicable law, regulation or official interpretation thereof, and certificates
representing such share may be legended to reflect any such restrictions.
16. EFFECTIVE DATE
Subject to the approval of the Plan by the holders of a majority of the
Common Stock present or represented and entitled to vote at the Company's 1996
Annual Meeting of Shareholders or any adjournment
23
<PAGE> 26
thereof at which a quorum is present, the Plan shall be effective as of May 1,
1996. If the condition set forth above is not satisfied, the Plan shall
terminate automatically.
17. PLAN ADMINISTRATION
The Plan shall be administered by the Compensation and Stock Option
Committee of the Board (the "Committee"). The Committee, subject to the other
provisions of the Plan, shall have the sole authority to determine any matters
arising under the Plan. Subject to the other provisions of the Plan, the
Committee shall have full power and authority to administer and interpret the
Plan and to adopt or amend such rules, regulations, agreements and instruments
for implementing the Plan and for conduct of its business as it deems necessary
or advisable, except to the extent, in each case, different provision is made by
the Regulations of the Company or by resolution of the Board. Subject to the
express provisions of the Plan, the Committee's interpretations of the Plan and
all determinations made by the Committee pursuant to the powers vested in it
hereunder shall be conclusive and binding on all persons having any interest in
the Plan or in any options granted hereunder. A majority of the Committee shall
constitute a quorum for purposes of meetings which may be held at such times and
places and on such notice as the Committee deems appropriate. All actions and
determinations of the Committee shall be made by not less than a majority of its
members and may be made at a meeting or by written consent in lieu of a meeting,
except to the extent, in each case, different provision is made by the
Regulations of the Company or by resolution of the Board.
24
<PAGE> 27
Common Stock
PARK-OHIO INDUSTRIES, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
P Edward F. Crawford and James W. Wert or either of them, are hereby
authorized, with full power of substitution, to represent and vote the
Common Stock of the undersigned at the annual meeting of shareholders
of Park-Ohio Industries, Inc. (the "Company") to be held at the
R Company's Auditorium, 23000 Euclid Avenue, Euclid Ohio, on May 23,
1996, and any and all adjournments, postponements or continuations
thereof.
O IF THIS PROXY IS PROPERLY EXECUTED AND RETURNED, SHARES REPRESENTED
HEREBY WILL BE VOTED IN THE MANNER SPECIFIED BY THE SHAREHOLDER. IF NO
SPECIFICATION IS MADE, SHARES WILL BE VOTED FOR THE ELECTION OF THE
PERSONS NOMINATED AS DIRECTORS PURSUANT TO THE PROXY STATEMENT AND FOR
X THE OTHER PROPOSALS INDICATED. IN THE EVENT OF CUMULATIVE VOTING FOR
DIRECTORS, UNLESS OTHERWISE INDICATED BY THE UNDERSIGNED, A VOTE FOR
THE NOMINEES LISTED WILL GIVE THE PROXYHOLDERS DISCRETIONARY AUTHORITY
TO CUMULATE ALL VOTES TO WHICH THE UNDERSIGNED IS ENTITLED AND TO
Y ALLOCATE THEM IN FAVOR OF ANY ONE OR MORE SUCH NOMINEES AS THE
PROXYHOLDERS DETERMINE.
<TABLE>
<S> <C>
Election of Directors, Nominees: (change of address)
Lewis E. Hatch, Jr., Thomas E. McGinty, Lawrence O. Selhorst, _______________________________
Richard S. Sheetz _______________________________
_______________________________
_______________________________
(If you have written in the above
space, please mark the corresponding
box on the reverse side of this card.)
</TABLE>
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE
APPROPRIATE BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES
IF YOU WISH TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS'
RECOMMENDATIONS. THE PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN
AND RETURN THIS CARD.
SEE REVERSE
SIDE
-------------------------------------------------------------------------------
DETACH CARD
<PAGE> 28
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
X PLEASE MARK YOUR SHARES IN YOUR NAME
VOTES AS IN THIS
EXAMPLE.
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] Director Nominees: 2. Approval of non-statutory stock [ ] [ ] [ ]
Directors Lewis E. Hatch, Jr., option to Mr. Crawford, Chairman
(see reverse) Thomas E. McGinty, and Chief Executive Officer
Lawrence O. Selhorst,
Richard S. Sheetz 3. Approval of the 1996 [ ] [ ] [ ]
Non-employee Director
For, except vote withheld from the following nominee(s): Stock Option Plan
- - -------------------------------------------------------- 4. Ratification of appointment of [ ] [ ] [ ]
Ernst & Young as independent
auditors.
5. The Proxies are authorized, in their discretion, to vote
upon such other business as may properly come before the
meeting or any adjournment, postponement or continuation thereof.
Change [ ] IMPORTANT -- THIS PROXY MUST BE SIGNED AND DATED.
of
Address
Attend [ ]
Meeting
SIGNATURE(S) ___________________________________________________________ DATE _______
SIGNATURE(S) ____________________________________________________________ DATE ______
NOTE: Please sign exactly as name appears hereon. Joint owners should each sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such.
-----------------------------------------------------------------------------------------------------------------------------------
DETACH CARD
</TABLE>
<PAGE> 29
Common Stock
PARK-OHIO INDUSTRIES, INC.
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD
OF DIRECTORS
To Key Trust Company of Ohio, N.A., Trustee of the Individual Account
Retirement Plan of Park-Ohio Industries, Inc. and Its Subsidiaries (the
"Plan"): The undersigned, a participant in the Plan, hereby directs the
Trustee to vote in person or by proxy (a) all common shares of Park-Ohio
V Industries, Inc. credited to the undersigned's account under the Plan on
O the record date ("allocated shares"); and (b) the proportionate number
T of common shares of Park-Ohio Industries, Inc. allocated to the accounts
I of other participants in the Plan, but for which the Trustee does not
N receive valid voting instructions ("non-directed shares") and as to
G which the undersigned is entitled to direct the voting in accordance
with the Plan provisions. Under the Plan, shares allocated to the
I accounts of participants for which the Trustee does not receive timely
N directions in the form of a signed voting instruction card are voted by
S the Trustee as directed by the participants who timely tender a signed
T voting instruction card. By completing this Confidential Voting
R Instruction Card and returning it to the Trustee, you are authorizing
U the Trustee to vote allocated shares and a proportionate amount of the
C non-directed shares held in the Plan. The number of non-directed shares
T for which you may instruct the Trustee to vote will depend on how many
I other participants exercise their right to direct the voting of their
O allocated shares. Any participant wishing to vote the non-directed
N shares differently from the allocated shares may do so by requesting a
S separate voting instruction card from the Trustee at 689-3685.
If this Confidential Voting Instruction Card is properly executed and
returned, shares represented hereby will be voted in the manner
specified by the participant.
<TABLE>
<S> <C>
Election of Directors, Nominees: (change of address)
Lewis E. Hatch, Jr., Thomas E. McGinty, _______________________________
Lawrence O. Selhorst, Richard S. Sheetz _______________________________
_______________________________
_______________________________
(If you have written in the above
space, please mark the corresponding
box on the reverse side of this card.)
</TABLE>
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE
BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO
VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS. THE
PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
SEE REVERSE
SIDE
- - --------------------------------------------------------------------------------
DETACH CARD
<PAGE> 30
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
X PLEASE MARK YOUR SHARES HELD FOR YOU
VOTES AS IN THIS
EXAMPLE.
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] Director Nominees: 2. Approval of non-statutory stock [ ] [ ] [ ]
Directors Lewis E. Hatch, Jr., option to Mr. Crawford, Chairman
(see reverse) Thomas E. McGinty, and Chief Executive Officer
Lawrence O. Selhorst,
Richard S. Sheetz 3. Approval of the 1996 [ ] [ ] [ ]
Non-employee Director
For, except vote withheld from the following nominee(s): Stock Option Plan
- - -------------------------------------------------------- 4. Ratification of appointment of [ ] [ ] [ ]
Ernst & Young as independent
auditors.
5. The Proxies are authorized, in their discretion, to vote
upon such other business as may properly come before the
meeting or any adjournment, postponement or continuation thereof.
Change [ ] IMPORTANT -- THIS CARD MUST BE SIGNED AND DATED.
of
Address
Attend [ ]
Meeting
SIGNATURE ___________________________________________________________ DATE ___________
- - --------------------------------------------------------------------------------
DETACH CARD
</TABLE>
<PAGE> 31
Common Stock
PARK-OHIO INDUSTRIES, INC.
CONFIDENTIAL VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD
OF DIRECTORS
V Elizabeth M. Boris, Ronald J. Cozean, and James S. Walker, or any of
O them, Trustees of RB&W Corporation Employee Stock Ownership Plan (the
T "Plan"), are hereby authorized, with full power of substitution, to
I represent and vote the Common Stock of the undersigned Plan Participant
N at the annual meeting of shareholders of Park-Ohio Industries, Inc. (the
G "Company") to be held at the Company's Auditorium, 23000 Euclid Avenue,
Euclid, Ohio, on May 23, 1996, and any and all adjournments,
I postponements or continuations thereof.
N
S IF THIS CONFIDENTIAL VOTING INSTRUCTION CARD IS PROPERLY EXECUTED
T AND RETURNED, SHARES REPRESENTED HEREBY WILL BE VOTED IN THE MANNER
R SPECIFIED BY THE PLAN PARTICIPANT. IF NO SPECIFICATION IS MADE, SHARES
U WILL BE VOTED FOR THE ELECTION OF THE PERSONS NOMINATED AS DIRECTORS
C PURSUANT TO THE PROXY STATEMENT AND FOR THE OTHER PROPOSALS INDICATED.
T IN THE EVENT OF CUMULATIVE VOTING FOR DIRECTORS, UNLESS OTHERWISE
I INDICATED BY THE UNDERSIGNED, A VOTE FOR THE NOMINEES LISTED WILL GIVE
O THE TRUSTEES DISCRETIONARY AUTHORITY TO CUMULATE ALL VOTES TO WHICH THE
N UNDERSIGNED IS ENTITLED AND TO ALLOCATE THEM IN FAVOR OF ANY ONE OR MORE
S SUCH NOMINEES AS THE TRUSTEES DETERMINE.
<TABLE>
<S> <C>
Election of Directors, Nominees: (change of address)
Lewis E. Hatch, Jr., Thomas E. McGinty, _______________________________
Lawrence O. Selhorst, Richard S. Sheetz _______________________________
_______________________________
_______________________________
(If you have written in the above
space, please mark the corresponding
box on the reverse side of this card.)
</TABLE>
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE
BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO
VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS. THE
PROXIES CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
SEE REVERSE
SIDE
- - --------------------------------------------------------------------------------
DETACH CARD
<PAGE> 32
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
[X] PLEASE MARK YOUR SHARES HELD FOR YOU
VOTES AS IN THIS
EXAMPLE.
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] Director Nominees: 2. Approval of non-statutory stock [ ] [ ] [ ]
Directors Lewis E. Hatch, Jr., option to Mr. Crawford, Chairman
(see reverse) Thomas E. McGinty, and Chief Executive Officer
Lawrence O. Selhorst,
Richard S. Sheetz 3. Approval of the 1996 [ ] [ ] [ ]
Non-employee Director
For, except vote withheld from the following nominee(s): Stock Option Plan
- - -------------------------------------------------------- 4. Ratification of appointment of [ ] [ ] [ ]
Ernst & Young as independent
auditors.
5. The Proxies are authorized, in their discretion, to vote
upon such other business as may properly come before the
meeting or any adjournment, postponement or continuation thereof.
Change [ ] IMPORTANT -- THIS CARD MUST BE SIGNED AND DATED.
of
Address
Attend [ ]
Meeting
SIGNATURE ___________________________________________________________ DATE ___________
- - --------------------------------------------------------------------------------
DETACH CARD
</TABLE>
