TRANS LEASING INTERNATIONAL, INC.
570 Lake Cook Road
Deerfield, Illinois 60015
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On December 9, 1997
The Annual Meeting of Shareholders of Trans Leasing International, Inc.
(the "Company") will be held on Tuesday, December 9, 1997, at 10:00 a.m., at
the Company's offices at 570 Lake Cook Road, Deerfield, Illinois 60015 for
the purpose of considering and acting upon the following:
(1) The election of six directors.
(2) Ratification of the appointment of Deloitte & Touche LLP as the
Company's independent auditors for the fiscal year ending June
30, 1998.
(3) Such other matters as may properly come before the meeting.
The Board of Directors of the Company has fixed October 10, 1997, at
the close of business, as the record date for the determination of
shareholders of the Company entitled to vote at the meeting, and only holders
of shares of Common Stock of record at the close of business on that day will
be entitled to vote. The stock transfer books will not be closed. A copy of
the list of shareholders of the Company entitled to vote at this meeting will
be available for examination by any shareholder of record for any purpose
germane to the meeting during normal business hours at the Company's offices
at 570 Lake Cook Road, Deerfield, Illinois 60015 during the period preceding
this meeting. A copy of the Company's 1997 Annual Report on Form 10-K is
being concurrently mailed to each person on such list.
Whether or not you expect to be present at the meeting, please date,
sign and return the enclosed proxy, which is solicited by the Board of
Directors of the Company. The proxy is revocable and will not affect your
right to vote in person, in the event you attend the meeting.
By Order of the Board of Directors
Michael J. Heyman
President, Chief Operating Officer
and Secretary
October 30, 1997
YOU ARE URGED TO DATE AND SIGN
THE ENCLOSED PROXY AND RETURN IT
PROMPTLY. THANK YOU.
<PAGE>
TRANS LEASING INTERNATIONAL, INC.
570 Lake Cook Road
Deerfield, Illinois 60015
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Directors of Trans
Leasing International, Inc., a Delaware corporation (hereinafter, the
"Company"), for use at the Annual Meeting of Shareholders (hereinafter, the
"Annual Meeting") to be held on December 9, 1997 and any adjournment
thereof. Proxies in the accompanying form, properly executed and received by
the Secretary prior to the meeting and not revoked, will be voted FOR the
election of directors as set forth herein (unless otherwise designated) and
FOR the ratification of the appointment of Deloitte & Touche LLP as
independent auditors for the fiscal year ending June 30, 1998. Any proxy may
be revoked at any time before it is exercised by giving notice to the Company
prior to or at the Annual Meeting. The approximate date of mailing of this
Proxy Statement is October 30, 1997. The cost of soliciting proxies will be
borne by the Company. In addition to solicitation by mail, proxies may be
solicited by directors, officers and other employees of the Company by
telephone, telex, in person or otherwise.
Only holders of Common Stock, par value $.01 per share, of the Company
(hereinafter, the "Common Stock") of record on the books of the Company at
the close of business on October 10, 1997 will be entitled to vote at the
Annual Meeting. As of October 10 1997, there were 4,040,755 shares of Common
Stock outstanding, the holders of which are entitled to one vote per share.
A majority of the outstanding Common Stock will constitute a quorum for the
transaction of business at the Annual Meeting, but if a quorum should not be
present, the Annual Meeting may be adjourned until a quorum is obtained.
ELECTION OF DIRECTORS
The Board of Directors of the Company consists of six directors, all of
whom will be elected at the Annual Meeting. The directors to be elected at
the Annual Meeting shall hold office until the 1998 Annual Meeting of
Shareholders and until their successors shall have been elected and
qualified. If the accompanying form of proxy is properly executed, the
persons named as proxies therein will (unless otherwise designated) vote the
shares of Common Stock represented by such executed proxy for the election of
the six persons named below. In case any of the nominees is not a candidate
at the meeting, an event which the Board of Directors does not anticipate,
the enclosed proxy may be voted for a substitute nominee and (unless
otherwise designated) will be voted for the other nominees named.
Information supplied by the directors concerning their ages, business
experience, periods of service as directors and the number of shares of
Common Stock of the Company beneficially owned as of October 10, 1997 is
shown on the following page.
<PAGE>
NOMINEES FOR ELECTION AT THE 1997 ANNUAL MEETING:
Shares
Business Experience and Served as a Beneficially
Name Age Other Information Director Owned
Since
Larry S. Grossman 48 Chairman of the Board of August 1991 2,166,000
Directors and Chief
Executive Officer of the
Company since October
1996. Chairman and Chief
Executive Officer of
FluoroScan Imaging Systems,
Inc. (the manufacturer of
the FluoroScan Imaging
System, a fluoroscopic
device) from 1982 to 1986
and from 1989 to 1996;
Chief Operating Officer and
Director of Pain Prevention
Labs, Inc. (a manufacturer
of an electronic dental
anesthesia device) from
1986 to 1989; and
President, Chief Executive
Officer and Director of the
Company from 1981 to 1982
and Vice President and
Director of the Company
from 1972 to 1981.
Michael J. Heyman 44 President and Chief August 1991 139,000
Operating Office of the
Company since October
1996. President and
Chairman of MOKSHA
Worldwide, Inc. (an
international marketing and
merchandising concern in
the apparel industry) since
1994; Senior Vice President
of Heyman Corporation (an
international marketing and
merchandising concern of
the apparel industry) from
1982 to 1994.
Larry Bier (a)(b) 45 Vice President of October 1996 20,000
Advertising for the Radio
Shack Division of Tandy
Corporation since September
1992. Advertising Director
of Circuit City Stores, a
retail electronics chain,
from January 1989 to August
1992.
Clifford V. 69 President and Chief June 1992 170,000
Brokaw, III(a) Executive Officer of Invail
Energy, Inc. (an Oklahoma
based oil and gas
production company) from
1977 to 1995. Prior to
that time, he was a general
partner of Eastman Dillon,
Union Securities & Co., an
investment banking firm
based in New York City.
Mark C. 45 Partner with the Argent August 1991 55,000
Matthews(d) Group (a developer of
commercial and residential
real estate) since 1985.
<PAGE>
John W. 74 Independent corporate February 85,000
Stodder(b)(c) finance and acquisition 1986-August
consultant since 1987; 1991 and
Director and Vice-Chairman since June
of Jostens, Inc. (a 1992
manufacturer of
educational, recognition
and technical products and
services for schools and
businesses) since 1978;
Director of Talley
Industries, Inc. (a
manufacturer of industrial
and defense products and
developer of real estate)
since 1970; Director of
Stevens Graphics Corp., (a
manufacturer of high volume
packaging and printing
machinery and equipment)
since 1992.
(a) Member of the Audit Committee of the Board of Directors.
(b) Member of the Compensation Committee of the Board of Directors.
(c) Chairman of the Audit Committee of the Board of Directors.
(d) Chairman of the Compensation Committee of the Board of Directors.
Certain Relationships and Related Transactions
The Company provides health and life insurance policies for the parents
of Larry S. Grossman. The costs to the Company of these policies did not
exceed $25,000 for the year ended June 30, 1997.
Information Regarding the Board of Directors
The Board of Directors held eleven meetings during fiscal 1997 and each
director attended every meeting of the Board of Directors and all of the
meetings for the Board Committees on which such director served.
The Audit Committee of the Board of Directors meets with management of
the Company and the Company's independent auditors to discuss the scope and
the results of the annual audit by the independent auditors, the fees for the
services to be performed by the independent auditors and the Company's
internal control structure. The Audit Committee met once in fiscal 1997. No
officers of the Company serve on the Audit Committee.
The Compensation Committee of the Board of Directors reviews and
recommends salaries and other forms of compensation of elected Company
officers, grants options under and administers the Company's stock option
plans and reviews other personnel and compensation matters with the Company's
management. The Compensation Committee held three meetings in fiscal 1997.
No officers of the Company serve on the Compensation Committee.
<PAGE>
The Board of Directors does not have a nominating committee.
Each director who is not an officer of the Company received a fee of
$18,000 per year and is reimbursed for out-of-pocket expenditures incurred to
attend Board and Committee meetings. The Company's directors have also been
granted warrants to purchase shares of Common Stock. See "Directors'
Warrants."
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers, directors and persons who beneficially own
more than ten percent of a registered class of the Company's equity
securities to file reports of securities ownership and changes in such
ownership with the Securities and Exchange Commission (the "SEC"). Officers,
directors and greater than ten percent beneficial owners also are required,
by rules promulgated by the SEC, to furnish the Company with copies of all
Section 16(a) forms they file.
Based solely upon a review of the copies of such forms furnished to the
Company, or written representations that no Form 5 filings were required, the
Company believes that during fiscal 1997 all of its officers, directors and
greater than ten percent beneficial owners complied with Section 16(a) filing
requirements applicable to them.
Certain Beneficial Owners
The following table sets forth certain information regarding the
beneficial ownership of the Common Stock as of October 1, 1997 (a) by each
person known by the Company to own beneficially more than five percent of
such outstanding Common Stock, (b) by each executive officer and director of
the Company and (c) by all executive officers and directors of the Company as
a group. Each of such shareholders has sole voting and investment power as
to shares shown unless otherwise noted.
<TABLE>
<CAPTION>
Shares Owned Percent
Beneficially of Class
<S> <C> <C>
Larry S. Grossman (1)................ 2,166,000 53.6%
Estate of Richard Grossman (2)....... 1,927,000 47.7%
Clifford V. Brokaw, III (3).......... 170,000 4.2%
John W. Stodder (4).................. 85,000 2.1%
Joseph Rabito (5).................... 76,548 1.9%
Michael J. Heyman (6)................ 139,000 3.4%
Mark C. Matthews (7)................. 55,000 1.4%
Larry Bier (8)....................... 20,000 *
All Directors and Officers as a Group 2,711,548 67.1%
(8 Persons)(9) ......................
</TABLE>
* Indicates less than 1% of outstanding shares.
(1)Includes 1,927,000 shares of Common Stock held in the
Estate of Richard Grossman over which Larry S. Grossman, as
administrator, has investment and voting control. Also
includes 35,000 shares of Common Stock issuable upon the
exercise of warrants and 200,000 shares of Common Stock
issuable upon the exercise of options.
(2)Larry S. Grossman, as administrator, has investment and
voting control over these shares.
<PAGE>
(3 Includes 55,000 shares of Common Stock issuable upon the
exercise of warrants.
(4)Includes 85,000 shares of Common Stock issuable upon the
exercise of warrants.
(5)Includes 74,156 shares of Common Stock issuable upon the
exercise of options.
(6)Includes 35,000 shares of Common Stock issuable upon the
exercise of warrants and 100,000 shares of Common Stock
issuable upon the exercise of options.
(7)Includes 55,000 shares of Common Stock issuable upon the
exercise of warrants.
(8)Includes 20,000 shares of Common Stock issuable upon the
exercise of warrants.
(9)See footnotes 1 and 3 thorough 8 above.
<PAGE>
Executive Compensation
The following table sets forth the total annual compensation paid or
accrued by the Company during fiscal years 1993, 1994, 1995, 1996 and 1997 to
the Company's Chief Executive Officer and to each of the Company's Executive
Officers other than the Chief Executive Officer.
<TABLE>
<CAPTION>
Summary Compensation Table
Long Term
Annual Compensation Compensation
All Other
Name and Salary Bonus Other Awards-Option Compensation
Principal Position Year ($) ($) Annual /SARs (#) ($)
Compensation
<S> <C> <C> <C> <C> <C> <C>
Larry S. Grossman 1997 $183,000(1) $101,000 $ - 200,000 $ -
Chief Executive
Officer and Chairman
<S> <C> <C> <C> <C>
Michael J. Heyman 1997 149,000(2) 85,000 - 100,000 -
President and
Chief
Operating
officer
<S> <C> <C> <C> <C> <C>
Joseph Rabito 1997 142,000 78,000 2,000 23,000 -
Executive Vice 1996 130,000 17,000 7,000 50,657 3,000
President, 1995 116,000 14,000 2,000 1,156(5) -
Operations(4) 1994 110,000 - 2,000 10,000(6) 2,000
1993 105,000 - - 5,000(6) -
<S> <C> <C> <C> <C>
Stephen J. Hupp 1997 24,000(3) 15,000 - 30,000 -
Vice President
of Finance
</TABLE>
(1) Larry S. Grossman became Chairman and Chief Executive Officer on
October 10, 1996. His annualized salary for fiscal 1997 was $300,000 per
year.
(2) Michael J. Heyman became President and Chief Operating Officer on
October 24, 1996. His annualized salary for fiscal 1997 was $225,000 per
year.
(3) Stephen J. Hupp became Vice President of Finance and Chief Financial
Officer on March 26, 1997. His annualized salary for fiscal 1997 was
$100,000 per year.
(4) Joseph Rabito became Executive Vice President on October 24, 1996.
(5) 657 of these options were canceled in connection with the issuance of
options in fiscal 1996.
(6) These options were cancelled in connection with the issuance of options
in fiscal 1996.
Some of the persons included in the preceding table received certain
non-cash compensation during fiscal 1997. Such compensation did not exceed,
in the case of any named individual, 10 percent of the cash compensation of
such individual or, in the case of the group, 10 percent of the cash
compensation for the group. The Company also provided Michael J. Heyman and
Joseph Rabito with the use of an automobile and related insurance coverage.
<PAGE>
The following table sets forth the number of shares of the Company's
Common Stock subject to stock options granted to the individuals listed in
the Summary Compensation Table during fiscal 1997 pursuant to the Company's
1996 Stock Option Plan, together with related information.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Individual Grants
Percent of Potential
total realizable
options Value at assumed
granted to Exercise annual rates
granted to or base of stock prices
Options employees price appreciation
granted in fiscal Expiration For option term.
Name # year ($/Sh date 5%($) 10%
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Larry S. Grossman 100,000(1) 21.9% $4.375 11/7/01 $512,000 $706,000
100,000(1) 21.9% 5.5 2/21/02 400,000 594,000
<S> <C> <C> <C> <C> <C> <C> <C>
Michael J. Heyman 50,000(1) 11.0% 4.375 11/7/01 256,000 353,000
50,000(1) 11.0% 5.5 2/21/01 200,000 297,000
<S> <C> <C> <C> <C> <C> <C> <C>
Joseph Rabito 10,000(1) 2.2% 4.375 11/7/01 51,000 71,000
13,000(1) 2.9% 4.375 11/7/01 67,000 92,000
<S> <C> <C> <C> <C> <C> <C> <C>
Stephen J. Hupp 30,000(2) 6.6% 6.25 3/27/02 97,000 156,000
</TABLE>
(1) Options are immediately exercisable.
(2) Option vest one-third on each of the first three anniversaries of the
grant date.
The following table sets forth the number of shares of Common Stock
subject to stock options exercised by the individuals listed in the Summary
Compensation Table during fiscal 1997, together with related information, and
the value of the unexercised options.
<TABLE>
<CAPTION>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Value of
Shares Number of unexercised
acquired on Value unexercised in-the-money
Name exercise realized options options
(#) ($) at fiscal at fiscal
year-end (#) year-end)($)(1)
(exercisable/ (exercisable/
unexercisable) unexercisable)
<S> <C> <C> <C> <C> <C>
Larry S. Grossman - $ - 200,000/0 $ 575,000 / $ 0
<S> <C> <C> <C> <C>
Michael J. Heyman - - 100,000/0 288,000/ 0
<S> <C> <C> <C> <C>
Joseph Rabito - - 74,156/ 0 306,000/ 0
<S> <C> <C> <C>
Stephen J. Hupp - - 0/30,000 0 / 47,000
</TABLE>
(1) Based on $7.8125 the last reported sales price of the Common Stock on
the NASDAQ Stock Market on June 30, 1997.
Executive Agreements
The Company has entered into a severance agreement with Larry S.
Grossman. Mr. Grossman's agreement provides that if either (i) the Company
terminates his employment without cause (e.g., the commission of a felony or
gross negligence) other than upon death, disability or resignation, or (ii)
Mr. Grossman terminates his employment for good reason (e.g., a reduction in
salary or reassignment of duties without his approval), the Company will pay
him a one-time cash severance payment equal to three times his annual base
salary then in effect.
<PAGE>
The Company, together with General Electric Capital Corporation
("GECC"), has also entered into a termination agreement with Mr. Grossman, in
connection with sale of the assets of the Company to GECC (see "Change of
Control"). This agreement provides for (i) a settlement payment of $440,000
to be paid to Mr. Grossman in full satisfaction of the Company's severance
and outplacement service obligations under the severance agreement, (ii) a
full release by Mr. Grossman of the Company from all claims and demands in
consideration of such settlement payment and (iii) a seven-year
non-competition and non-solicitation obligation by Mr. Grossman with GECC and
the Company.
The Company has entered into an employment agreement with Michael J.
Heyman, which provides for, among other things, a base salary of $225,000 per
year, a term of three years which expires on October 24, 1999 (with an
automatic renewal for a term of one year), and, if Mr. Heyman's employment is
terminated without cause other than upon death, disability or resignation,
severance payments equal to (i) his base salary then in effect, payable over
a one-year period, if his employment is terminated in the first year, (ii)
two times his base salary then in effect, payable over a two-year period, if
his employment is terminated in the second year, and (iii) three times his
base salary then in effect, payable for a three-year period, if his
employment is terminated after the second year.
The Company, together with GECC, has also entered into a termination
agreement with Mr. Heyman, in connection with sale of the Company to GECC
(see "Change of Control"). This agreement provides for (i) a settlement
payment of $665,000 to be paid to Mr. Heyman in full satisfaction of the
Company's severance and outplacement service obligations under the severance
agreement, (ii) a full release by Mr. Heyman of the Company from all claims
and demands in consideration of such settlement payment and (iii) a
seven-year non-competition and non-solicitation obligation by Mr. Heyman with
GECC and the Company.
The Company has entered into a severance agreement with Joseph Rabito.
Mr. Rabito's severance agreement provides that if either (i) during a
one-year period after a change of control of the Company, the Company
terminates his employment without cause other than upon death, disability or
resignation or (ii) Mr. Rabito terminates his employment for good reason, the
Company will pay him a one-time cash severance payment equal to two times his
annual base salary then in effect. In addition, each of the severance
agreements requires the Company to cover outplacement service expenses not to
exceed 20% of the executive's base salary. Mr. Rabito, together with the
Company and GECC, has agreed to terminate his severance agreement with the
Company in connection with an employment agreement with GECC commencing at
the closing of the Company's transaction with GECC.
Directors' Warrants
During fiscal 1997, the Company also granted to certain of its current
directors warrants entitling them to purchase shares of Common Stock. Each
of Larry Bier, Clifford V. Brokaw, III, Mark C. Matthews, and John W. Stodder
was granted warrants to purchase 10,000 shares of Common Stock at an exercise
price of $4.375 per share on November 7, 1996, and was granted warrants to
purchase 10,000 shares of Common Stock at an exercise price of $5.50 per
share on February 21, 1997.
<PAGE>
Report of the Compensation Committee
The Compensation Committee (hereinafter, the "Committee"), is comprised
of three out of six of the Company's directors: Larry Bier, Mark C.
Matthews, and John W. Stodder. Mark C. Matthews serves as Chairman of the
Committee. The Committee reviews and approves the compensation of each of
the executive officers of the Company (hereinafter, the "Officers"). The
Committee also administers the Company's stock option plans and other benefit
plans.
The Company's compensation program for Officers is designed to reward
such officers for their individual performance and contribution to the
Company while at the same time being tied directly to the Company's overall
performance. The Committee and the Board of Directors (the "Board") believe
that a direct relationship between Officers' compensation and the Company's
performance is a very important factor in achieving the Company's objective
of maximizing shareholder value.
The Company's executive compensation program consists of a base salary
and participation in the Officer Bonus Plan (the "Bonus Plan"), the 1992
Executive Management Group Stock Option Plan (the "1992 Plan") and the 1996
Stock Option Plan (the "1996 Plan"). The Officers may also participate in
the Trans Leasing International, Inc. Savings Plan (the "Savings Plan") and
the 1986 Employees Stock Option and Performance Unit Plan (the "1986 Plan")
with the other salaried employees.
In order to retain certain key employees subsequent to Richard
Grossman's death, the Company promoted Joseph Rabito to Executive Vice
President and increased his compensation in accordance with the promotion.
In order to attract certain key employees following the termination of both
the Vice President, Sales and Vice President, Finance during fiscal 1997, the
Company established salaries for executives commensurate with the
responsibilities and roles assigned. It is the Committee's belief that the
potential to earn incremental compensation in the future should be tied
directly to the Company's performance and that this is accomplished through
the other components of the executive compensation program discussed below.
The minimum financial goals in the 1997 Bonus Plan were met in fiscal
1997. Therefore, cash payments were made under that portion of the Plan
equal to 54% of officers' annual compensation. The 1998 Bonus Plan is
designed to provide an incentive to the Officers in the form of a cash
payment at the end of the fiscal year if the Company achieves certain return
on equity performance targets.
The Committee may also grant to the Officers stock options under the
1996 Plan based on the Committee's evaluation of each Officer's performance.
The Committee believes that by providing the opportunity for compensation
through equity ownership, management will be more focused on maximizing
shareholder value.
Mark C. Matthews, Chairman
Larry Bier
John W. Stodder
<PAGE>
Stock Option Plans
In February 1986, the Company adopted the 1986 Plan. Under the 1986
Plan, the Committee could grant, prior to February, 1996, to key employees of
the Company stock options which may be "incentive stock options" ("ISOs") as
defined in the Internal Revenue Code of 1986, as amended (the "Code"),
appreciation rights or performance units. Stock options that do not qualify
as ISOs could also be granted under the 1986 Plan. The maximum number of
shares of Common Stock that were available for grant under the 1986 Plan was
210,000. The exercise price of options granted under the 1986 Plan may not
be less than 100% of the fair market value of the Common Stock of the Company
on the date of grant, except in the case of persons owning 10% or more of the
Common Stock, with respect to whom such price could not be less than 110% of
such fair market value. No option could be granted with a term exceeding
five years. The option price may be paid in cash or, to the extent permitted
by the Committee, by delivery of the optionee's promissory note or by
delivery of Common Stock already owned by the optionee (valued at its fair
market value at the time of exercise). Subject to the discretion of the
Committee, options which are not ISOs and appreciation rights may require the
Company to make a cash payment to the holder thereof in an amount equal, in
the case of an option exercise, to the excess of the fair market value of a
share of Common Stock on the date the holder recognizes taxable income over
the option price multiplied by the number of shares as to which the option is
exercised. At October 1, 1997, options granted under the 1986 Plan covering
an aggregate of 60,156 shares of Common Stock were outstanding, including
options held by Joseph Rabito covering 51,156 shares. As of such time, none
of such options had been exercised.
The Company adopted the 1992 Plan in April 1992, at which time certain
key managers were granted options. Participants in the Plan may also be
granted options if the Company's earnings exceed certain thresholds. The
maximum number of shares of Common Stock that are available for grant under
the 1992 Plan is 214,260. Presently, there are no outstanding options issued
under the 1992 Plan.
<PAGE>
The 1996 Plan was adopted in November 1996. Under the 1996 Plan, the
Committee may grant to directors and key employees of the Company stock
options which may be ISOs. Stock options that do not qualify as ISOs may
also be granted under the 1996 Plan. The maximum number of shares of Common
Stock that are available for grant under the 1996 Plan is 1,000,000. The
exercise price of options granted under the 1996 Plan may not be less than
100% of the fair market value of the Common Stock of the Company on the date
of grant, except in the case of persons owning 10% or more of the Common
Stock, with respect to whom such price shall not be less than 110% of such
fair market value. No option could be granted with a term exceeding five
years. The option price may be paid in cash or, to the extent permitted by
the Committee, by delivery of the optionee's promissory note or by delivery
of Common Stock already owned by the optionee (valued at its fair market
value at the time of exercise). Subject to the discretion of the Committee,
options which are not ISOs may require the Company to make a cash payment to
the holder thereof in an amount equal to the excess of the fair market value
of a share of Common Stock on the date the holder recognizes taxable income
over the option price multiplied by the number of shares as to which the
option is exercised. The purpose of such cash payments will be to assist the
person exercising the non-ISO option to pay his federal income taxes
resulting from the exercise. At October 1, 1997, options granted under the
1996 Plan covering an aggregate of 456,000 shares of Common Stock were
outstanding, including options held by the following persons, covering the
number of shares indicated: Larry Grossman (200,000 shares), Michael Heyman
(100,000 shares), Stephen Hupp (30,000 shares), Joseph Rabito (23,000)
shares) and all executive officers as a group (353,000 shares). As of such
time, no options had been exercised under the 1996 Plan.
Officer Bonus Plan
The Bonus Plan is designed to align the incentives of officers with
those of the Company generally by awarding bonuses based on the Company's
financial performance. Each year, the Committee establishes a Bonus Plan for
the following fiscal year. In 1997, the target bonus established by the
Committee for the officers of the Company was a percentage of base salary
(ranging from 12.5% to 62.5%) based upon the Company meeting certain return
on equity thresholds. Given the Company's performance in fiscal 1997, cash
payments made under the Bonus Plan equaled 54% of officers' annual
compensation.
Stock Price Performance Table
The following table compares the total return of the Company's Common
Stock with the Center for Research in Securities Prices ("CRSP") Total Return
Index for the NASDAQ Stock market (U.S. Companies) and the CRSP Total Return
Index for NASDAQ Financial Stocks.
<TABLE>
<CAPTION>
Fiscal Year Ending
6/30/92 6/30/93 6/30/94 6/30/95 6/30/96 6/30/97
Trans Leasing
<S> <C> <C> <C> <C> <C> <C>
International 100.00 86.84 73.68 78.95 72.37 164.47
NASDAQ U.S.
<S> <C> <C> <C> <C> <C> <C>
Companies 100.00 125.76 126.97 169.48 217.59 264.59
NASDAQ
<S> <C> <C> <C> <C> <C> <C>
Financials 100.00 131.42 148.36 169.62 220.78 322.98
</TABLE>
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Upon recommendation by the Audit Committee, the Board of Directors
has appointed Deloitte & Touche LLP as independent auditors for the Company's
fiscal year ending June 30, 1998. The Company has been advised that Deloitte
& Touche LLP has no relationship with the Company or its subsidiaries other
than that arising from their role as the Company's auditors.
Representatives of Deloitte & Touche LLP are expected to be present at
the 1997 Annual Meeting with the opportunity to make a statement if they so
desire and to be available to respond to appropriate questions relating to
that firm's examination of the Company's financial statements for fiscal 1997.
<PAGE>
CHANGE OF CONTROL
As a result of the passing away of Richard Grossman, Larry S. Grossman,
the current Chairman of the Board and Chief Executive Offer of the Company,
acquired beneficial ownership of 1,927,000 shares of Common Stock upon his
qualification on October 21, 1996, as administrator of Richard Grossman's
estate. As a result, Larry S. Grossman beneficially owns 53.6% of the Common
Stock. See "Certain Beneficial Owners." Larry S. Grossman, as administrator
of Richard Grossman's estate, has voting and investment control over the
Common Stock in Richard Grossman's estate and may pledge or sell a portion of
such Common Stock to cover the estate's expenses, including any taxes. It is
expected that any shares of Common Stock remaining in the estate will be
distributed to the heirs of Richard Grossman.
On August 27, 1997, the Company entered into an agreement to sell
substantially all the net assets of the Company to GECC. The gross sale
proceeds approximate $46 million and involves assumption by GECC of certain
debt outstanding upon closing of the sale. Subject to required regulatory
filings, the Company anticipates the sale transaction will close in the
second quarter of fiscal 1998. Net proceeds from the sale, after
consideration of certain post-closing expenses, will approximate $10.00 per
share and be distributed to shareholders via a liquidating dividend in early
calendar year 1998. There can be no assurance that the transaction with GECC
will be completed or that the liquidated distribution will be made.
DISCRETIONARY VOTING OF PROXIES IN OTHER MATTERS
The Board does not know of any other matters that are to be presented
for action at the Annual Meeting. Should any other matter come before the
Annual Meeting, however, the persons named in the enclosed proxy will have
discretionary authority to vote all proxies with respect to such matter in
accordance with their judgment.
<PAGE>
SUBMISSION OF SHAREHOLDER PROPOSALS
All proposals of shareholders intended to be presented at the 1998
Annual Meeting of Shareholders must be received by the Company at its
executive offices no later than the close of business on August 11, 1998 for
inclusion in the Company's Proxy Statement and form of proxy relating to that
meeting.
VOTING PROCEDURES
Under Delaware law and the Company's Certificate of Incorporation and
By-laws, if a majority of the shares entitled to vote is present at the
meeting in person or by proxy (i) the six nominees for election as directors
who receive the greatest number of votes cast for the election of directors
at the meeting by the shares present in person or by proxy and entitled to
vote shall be elected directors and (ii) the ratification of the appointment
of Deloitte & Touche LLP and generally any other matter submitted to a vote
of the shareholders must be approved by the affirmative vote of the majority
of shares present in person or by proxy and entitled to vote on the matter.
In the election of directors, any action other than a vote of a nominee will
have the practical effect of voting against the nominee. Abstention from
voting will have the practical effect of voting against any of the other
matters since it is one less vote for approval.
ADDITIONAL INFORMATION
This solicitation is being made by the Company. All expenses of the
Company in connection with solicitation will be borne by the Company. In
addition to solicitation by mail, proxies may be solicited by directors,
officers and other employees of the Company by telephone, telex, in person or
otherwise, without additional compensation. The Company will request
brokerage firms, nominees, custodians and fiduciaries to forward proxy
materials to the beneficial owners of shares held of record by such persons
and will reimburse such persons and the Company's transfer agent for their
reasonable out-of-pocket expenses in forwarding such materials.
The Company has previously furnished to each person whose proxy is
being solicited a copy of the Company's Annual Report on Form 10-K for the
fiscal year ended June 30, 1997 as filed with the Securities and Exchange
Commission, including the financial statements contained therein. Requests
for additional copies of such Annual Report on Form 10-K should be directed
to the Secretary of the Company.
By Order of the Board of Directors
Michael J. Heyman
President, Chief Operating Officer
and Secretary
October 30, 1997
<PAGE>
PROXY PROXY
TRANS LEASING INTERNATIONAL, INC.
This proxy is solicited on behalf of the Board of Directors for
the Annual Meeting of Shareholders to be held on December 9, 1997
The undersigned Shareholder of Trans Leasing International, Inc. (the
"Company") hereby appoints Larry S. Grossman and Michael J. Heyman, and each
of them, proxies, with power of substitution, to vote at the Annual Meeting
of Shareholders of the Company to be held at the Company Offices, 570 Lake
Cook Road, Deerfield, IL 60015 on Friday, December 9, 1997 at 10:00 a.m.,
CDT, or postponement or adjournment thereof, with all the powers the
undersigned would possess if present, with respect to the following:
PLEASE MARK, SIGN, DATE AND MAIL THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
(Continued and to be signed on reverse side.)
<PAGE>
TRANS LEASING INTERNATIONAL, INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
1. Election of Directors --
Nominees: Larry S. Grossman, Michael J. Heyman, Clifford V. Brokaw,
III, Mark C. Matthews, Larry Bier, and John W. Stodder.
[ ] For All [ ] Withhold All [ ] For All Except Nominee(s)
written below)
________________________
2. Ratification of Appointment of Independent Auditors --
Ratification of the appointment of Deloitte & Touche LLP as the
Company's independent auditors for the fiscal year ending June 30, 1998.
[ ] For [ ] Against [ ] Abstain
3. Discretionary Voting of Proxies on Other Matters --
In their discretion of the proxies, in the transaction of such other
business which may properly come before the meeting; all as described
in the notice of 1997 Annual meeting of Shareholders and related Proxy
Statement.
The Board of Directors Favors a Vote FOR Items 1 and 2. The Shares Represented
By This Proxy Will Be Voted As Directed, But Where No Direction Is Given,
Those Shares Will Be Voted For Such Item(s).
Dated: _______________________, 1997
Signature(s)
Please sign exactly as name appears above. When shares are held by joint
tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
