UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. [ ])
Filed by the Registrant [X ]
Filed by a Party other than the Registrant [ ]
Check the Appropriate Box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e) (2))
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
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C&D TECHNOLOGIES, INC.
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(Name of Registrant as Specified in Its Charter)
-----------------------------------------------------
(Name of Person(s) Filing Proxy Statement if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
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
O-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided
by Exchange Act Rule O-11(a)(2) and identify the filing
for which the offsetting fee was paid previously.
Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its
filing.
1) Amount Previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
C&D TECHNOLOGIES, INC. 1400 Union Meeting Road
POWER SOLUTIONS P.O. Box 3053
Blue Bell, PA 19422-0858
Telephone (215)619-2700
Fax (215)619-7840
May 27, 1999
Dear Stockholder:
We cordially invite you to attend the Annual Meeting of Stockholders of
C&D TECHNOLOGIES, INC. to be held on Tuesday, June 29, 1999, at 10:00 A.M., at
The Union League of Philadelphia, 140 South Broad Street, Philadelphia,
Pennsylvania. Your Board of Directors and management look forward to personally
greeting you there.
Whether or not you plan to attend, your shares will be represented and
voted at the Annual Meeting if you promptly complete, sign, date and return the
enclosed proxy card in the envelope we have provided.
We thank you for your cooperation and continued support.
Sincerely,
/s/ William Harral, III
-----------------------
WILLIAM HARRAL, III
Chairman of the Board
<PAGE>
C&D TECHNOLOGIES, INC.
1400 Union Meeting Road
Blue Bell, Pennsylvania 19422
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JUNE 29, 1999
----------------------------------------
The Annual Meeting of Stockholders of C&D TECHNOLOGIES, INC. ("C&D")
will be held at The Union League of Philadelphia, 140 South Broad Street,
Philadelphia, Pennsylvania, on Tuesday, June 29, 1999, at 10:00 A.M., for the
following purposes:
1. To elect directors of C&D for the ensuing year
2. To ratify the appointment of PricewaterhouseCoopers LLP as independent
accountants for C&D for the fiscal year ending January 31, 2000
3. To transact such other business as may properly come before the meeting
and any adjournments of the meeting
Stockholders of record at the close of business on May 10, 1999 will be
entitled to vote at the meeting and at any adjournments of the meeting.
If you are unable to be present personally, please sign and date the
enclosed proxy, which is being solicited by the Board of Directors, and return
it promptly in the enclosed envelope.
BY ORDER OF THE BOARD OF DIRECTORS
GLENN M. FEIT
Secretary
May 27, 1999
<PAGE>
C&D TECHNOLOGIES, INC.
1400 Union Meeting Road
Blue Bell, Pennsylvania 19422
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JUNE 29, 1999
Your proxy is solicited by and on behalf of the Board of Directors of C&D
TECHNOLOGIES, INC. ("C&D", "we" or "our") to be used at the Annual Meeting of
Stockholders to be held at The Union League of Philadelphia, 140 South Broad
Street, Philadelphia, Pennsylvania, on Tuesday, June 29, 1999, at 10:00 A.M.,
and at any adjournment of the meeting. The following questions and answers
provide important information about the Annual Meeting and this Proxy Statement.
What am I voting on?
- --------------------
o Election of Directors
o Ratification of the appointment of PricewaterhouseCoopers LLP as C&D's
independent accountants through January 31, 2000
Who is entitled to vote?
- ------------------------
Stockholders as of the close of business on May 10, 1999 (the "Record
Date") are entitled to vote at the Annual Meeting. Each stockholder is entitled
to one vote for each share of common stock held on the Record Date.
How do I vote?
- --------------
You should sign and date each proxy you receive and return it in the
enclosed, self-addressed envelope. If you return your signed proxy but do not
indicate your voting preferences, we will vote on your behalf FOR the election
of the seven directors and the ratification of the independent accountants.
How is proxy solicitation done?
- -------------------------------
C&D will bear the cost of the solicitation of proxies. We will make
solicitations initially by first class mail; however, officers and regular
employees of C&D may solicit proxies personally or by telephone or the internet.
We will not compensate those persons specifically for these services. C&D may
also retain an outside proxy solicitation firm to assist in soliciting proxies
and will compensate that firm at its customary rate. C&D may reimburse brokers,
banks, custodians, nominees, and fiduciaries holding shares of common stock in
their names or in the names of their nominees for their reasonable charges and
expenses in forwarding proxies and proxy material to the beneficial owners of
those shares.
We are mailing this Proxy Statement to stockholders on or about May 27,
1999.
<PAGE>
How should I sign the proxy?
- ----------------------------
You should sign your name exactly as it appears on the proxy. If you are
signing in a representative capacity (for example, as attorney, executor,
administrator, guardian, trustee, or the officer or agent of a company), you
should indicate your name and title or capacity. If you hold the stock in
custody for a minor (for example, under the Uniform Transfers to Minors Act),
you should sign as custodian, not the minor. If you hold the stock in joint
ownership with another person or persons, one owner may sign on behalf of all
the owners.
May I revoke my proxy?
- ----------------------
You have the right to revoke your proxy at any time before the meeting by
(1) delivering a written revocation to the Secretary of C&D, or (2) returning a
later-dated proxy. You may also revoke your proxy by voting in person at the
meeting.
What does it mean if I receive more than one proxy card?
- --------------------------------------------------------
If you hold shares registered in more than one account, you will receive a
proxy card for each account. You should sign and return all proxies so that all
your shares will be voted.
Who will count the votes?
- -------------------------
Representatives of Continental Stock Transfer & Trust Company, C&D's
transfer agent, will tabulate the votes and act as independent inspectors for
the election.
What constitutes a quorum?
- --------------------------
We are required to have a quorum to hold the Annual Meeting. A quorum is a
majority of the outstanding shares, present or represented by proxy. As of the
Record Date, 12,566,327 shares of common stock were issued and outstanding.
Abstentions and broker non-votes (which we define below) are counted as if
stockholders were present for purposes of determining whether a quorum is
present at the meeting.
How many votes are needed for the approval of each item?
- --------------------------------------------------------
There are differing requirements for the proposals. Voting is not
cumulative; directors will be elected by a plurality of the votes cast at the
Annual Meeting, which means that the seven nominees with the most votes will be
elected directors. We will count only votes cast for a nominee, except that your
proxy will be voted FOR the seven nominees described in this proxy statement
unless you instruct us to the contrary in your proxy.
The proposal to ratify the appointment of the independent accountants and
any other business that may properly come before the meeting and adjournments
thereof will be approved if there are more votes cast for the proposal than
there are cast against the proposal. It is counted the same as votes against a
proposal if a stockholder indicates on his proxy that he is abstaining from
voting on an item. Broker non-votes are not counted for purposes of determining
whether a proposal has been approved.
What is a "broker non-vote"?
- ----------------------------
A "broker non-vote" occurs when a stockbroker submits a proxy that does
not indicate a vote for a proposal because the stockbroker has not received
instructions from the beneficial owners on how to vote on the proposal and does
not have the authority to vote without instructions.
2
<PAGE>
What percentage of the stock do directors and officers own?
- -----------------------------------------------------------
Together, they owned approximately 1.1% of our common stock on April 27,
1999 (we have provided you with details on pages 5 and 6).
Who are the largest stockholders?
- ---------------------------------
As of April 27, 1999, Westport Asset Management, Inc. owned 1,237,300
shares (or 9.9%); Paradigm Capital Management, Inc. owned 841,000 shares (or
6.7%); Atlantic Investment Management, Inc. owned 818,470 shares (or 6.5%); and
Shell Pensions Trust Limited owned 794,400 shares (or 6.3%) (see page 4 for
details).
What is the deadline for submitting stockholder proposals at our 2000 annual
- --------------------------------------------------------------------------------
meeting?
- --------
Stockholders may submit proposals for consideration at our 2000 annual
meeting in one of two ways. They may ask us to include the proposal in next
year's proxy statement and on next year's proxy cards by submitting the proposal
to us in writing no later than January 27, 2000. Alternatively, they may choose
not to ask us to include the proposal in next year's proxy statement and on next
year's proxy cards, in which case the proposal must be submitted to us no later
than April 12, 2000. Stockholder proposals should be submitted to the attention
of our Vice President - Finance and Chief Financial Officer at the address at
the front of this proxy statement.
3
<PAGE>
PRINCIPAL STOCKHOLDERS
As of April 27, 1999, the persons listed in the following table were the
only persons known to us (based solely on information set forth in Schedules
13D, 13D/A and 13G/A filed with the Securities and Exchange Commission) to be
the beneficial owners of more than five percent of our outstanding shares of
common stock.
Shares of
Name and address of Common Stock Percent
Beneficial Owner Beneficially Owned (5) of Class
- ---------------------------------------- ---------------------- --------
Westport Asset Management, Inc. (1)........ 1,237,300 9.9%
253 Riverside Avenue
Westport, Connecticut 06880
Paradigm Capital Management, Inc. (2)...... 841,000 6.7%
9 Elk Street
Albany, New York 12207
Atlantic Investment Management, Inc. (3)... 818,470 6.5%
750 Lexington Avenue
New York, New York 10022
Shell Pensions Trust Limited (4)........... 794,400 6.3%
Shell Centre
London SE1 7NA
England
- --------------------
(1) Based on the Schedule 13G/A, dated February 16, 1999, filed by Westport
Asset Management, Inc. This party has shared voting and dispositive
power with respect to all the shares listed opposite its name in the
table.
(2) Based on the Schedule 13G/A, dated February 9, 1999, filed by Paradigm
Capital Management, Inc. This party has sole voting power with respect
to 40,900 shares and sole dispositive power with respect to all the
shares listed opposite its name in the table.
(3) Based on the Schedule 13D/A, dated March 18, 1999, filed by Atlantic
Investment Management, Inc. This party has sole voting and dispositive
power with respect to all the shares listed opposite its name in the
table.
(4) Based on the Schedule 13D, dated February 2, 1996, filed by Shell
Pensions Trust Limited as Trustee of the Shell Contributory Pension
Fund. This party has sole voting and dispositive power with respect to
all the shares listed opposite its name in the table.
(5) All share data has been adjusted to reflect C&D's two-for-one stock
split, effected in the form of a 100% stock dividend, where
appropriate.
4
<PAGE>
ELECTION OF DIRECTORS
At the Annual Meeting of Stockholders, you will be electing the entire
Board of Directors. Each nominee has consented to being named as a nominee in
this Proxy Statement and to serve if elected. However, if any nominee should
become unable to serve as a director for any reason, the named proxies will vote
for a substitute nominee designated by the Board of Directors or, if none is so
designated, will be cast according to the judgment of the person or persons
voting the proxy.
MANAGEMENT
Directors are elected annually to serve until the next annual meeting of
stockholders and until their successors have been elected. Officers are elected
by and serve at the discretion of the Board of Directors. There are no family
relationships among any of our directors and executive officers.
<TABLE>
<CAPTION>
Shares of Common
Stock Beneficially Percent
Positions and Offices Owned as of of
Nominees for Directors with C&D Age April 27, 1999(6) Class (7)
- --------------------------------- -------------------------------- --- ------------------ ---------
<S> <C> <C> <C> <C>
William Harral, III (1)(2)(3)(4)... Chairman of the Board 59 12,414 *
Wade H. Roberts, Jr................ President and Chief Executive 52 5,000 *
Officer (as of April 1, 1999);
Director
Kevin P. Dowd (1)(2)(3)(5)......... Director 50 3,414 *
Glenn M. Feit (1)(2)............... Director and Secretary 69 4,414 *
Pamela S. Lewis (1)(5)............. Director 42 2,414 *
George MacKenzie................... Director 50 -- *
John A. H. Shober (1)(4)(5)........ Director 65 6,414 *
Executive Officers who
are not Directors
- ---------------------------------
Charles R. Giesige................. Vice President and General 43 -- *
Manager - Dynasty Division
Leslie S. Holden (1)............... Vice President - Battery 62 23,443 *
Technology
Apostolos T. Kambouroglou (1)...... Vice President - Operations 56 47,466 *
Stephen E. Markert, Jr. (1)........ Vice President - Finance and 47 27,381 *
Chief Financial Officer
Robert T. Marley (1) .............. Treasurer 46 1,500 *
Larry W. Moore (1)................. Vice President and General 56 6,335 *
John J. Murray, Jr. (1)............ Vice President and General 55 2,000 *
Manager - Motive Power Division
Mark Z. Sappir..................... Vice President - Human Resources 47 -- *
All directors and
officers as a group (15 persons).. 142,195 1.1%
- ---------------
</TABLE>
* Less than 1% of outstanding shares of common stock
(footnotes begin on following page)
5
<PAGE>
(1) The figures for shares of common stock beneficially owned as of April
27, 1999 include fully vested and presently exercisable options to
purchase (a) 2,000 shares for each of Messrs. Harral, Dowd, Feit and
Shober and Dr. Lewis, (b) 13,467 shares for Dr. Holden, (c) 43,466
shares for Mr. Kambouroglou, (d) 19,333 shares for Mr. Markert, (e)
1,500 shares for Mr. Marley, (f) 5,335 shares for Mr. Moore and (g)
2,000 shares for Mr. Murray.
(2) Member of the Compensation Committee.
(3) Member of the Stock Option Subcommittee of the Compensation Committee.
(4) Member of the Corporate Governance and Nominating Committee.
(5) Member of the Audit Committee.
(6) All share data has been adjusted to reflect C&D's two-for-one stock
split, effected in the form of a 100% stock dividend, where
appropriate.
(7) Based upon shares outstanding as of April 27, 1999, excluding treasury
stock. In determining Percent of Class, the number of shares
outstanding includes shares issuable on exercise of stock options
within 60 days of the calculation date to the specific director,
officer or group identified in the table, but no other shares issuable
on exercise of stock options.
William Harral, III has been a director of C&D since July 1996 and Chairman
of the Board since April 1999. He is currently Senior Counselor for The Tierney
Group, a strategic communications company. He was President and Chief Executive
Officer of Bell Atlantic - Pennsylvania, Inc. (formerly Bell of Pennsylvania)
from 1994 to March 1997. Mr. Harral also served as a director of Bell Atlantic -
Pennsylvania, Inc. and serves on the board of The Bryn Mawr Trust Company, a
commercial bank.
Wade H. Roberts, Jr. has been President and Chief Operating Officer since
joining C&D in October 1998 and became Chief Executive Officer in April 1999.
Prior to joining C&D, Mr. Roberts was Vice President and Group Executive of IDEX
Corporation and President of its Hale Products, Inc. subsidiary, a manufacturer
of vehicle mounted fire pumps and the "Jaws of Life(TM)," from 1994 to 1998. C&D
has entered into an employment agreement with Mr. Roberts as of October 22,
1998.
Kevin P. Dowd has been a director of C&D since January 1997. He has been a
director, President and Chief Executive Officer of Checkpoint Systems, Inc.
("Checkpoint"), a manufacturer and supplier of electronic security systems for
retail and commercial customers, since January 1995. Mr. Dowd was President and
Chief Operating Officer of Checkpoint from 1993 to 1995 and prior to that he
served as the Executive Vice President of Checkpoint. Mr. Dowd is also a
director of Holy Redeemer Health System and MAB Paints, Inc.
Glenn M. Feit has been a director and the Secretary of C&D since January
1986. He is a member of the law firm of Proskauer Rose LLP, our general counsel.
Mr. Feit has been engaged in the practice of law in New York since 1957. Mr.
Feit is also a director of Wundies Industries, Inc., a manufacturer and
distributor of ladies' and children's underwear and sleepwear, and Blair
Industries, Inc., a manufacturer and distributor of molded plastic products. Mr.
Feit is the Secretary of Charterhouse Group International, Inc., a manager of
private equity investment funds.
6
<PAGE>
Pamela S. Lewis has been a director of C&D since June 1998. She has been a
Professor of Management and Dean of the College of Business and Administration
at Drexel University since June 1997. Prior to her association with Drexel
University, Dr. Lewis served as Chair of the Department of Management at the
University of Central Florida. Her professional specialization is in the field
of strategic planning with a particular emphasis on competitive and marketing
strategy. She has written and lectured on these topics extensively. Dr. Lewis is
also a director of Charming Shoppes, Inc., a retailer of women's apparel,
Transitional Work, Inc. and the Pennsylvania Economy League.
George MacKenzie has been a director of C&D since April 1999. He has been
Senior Vice President and Chief Financial Officer of Hercules, Inc., a specialty
chemical company, since 1996, having previously served as its Vice President and
Chief Financial Officer from 1995 to 1996 and its Vice President and Treasurer
from 1991 to 1995. Previously, Mr. MacKenzie held various corporate accounting
positions at Hercules, Inc. He serves on the Board of Trustees of the Medical
Center of Delaware and OperaDelaware and is a member of the Investment Committee
and Accounting Advisory Board at the University of Delaware. Mr. MacKenzie is
also a member of both the American and the Pennsylvania Institutes of Certified
Public Accountants.
John A. H. Shober has been a director of C&D since July 1996. He has been a
director of Penn Virginia Corporation, a natural resources company, since 1989,
Vice Chairman of the board of directors from 1992 to 1996, and President and
Chief Executive Officer from 1989 to 1992. Mr. Shober is also a director of
Airgas, Inc., Anker Coal Group, Inc., Ensign-Bickford Industries, Inc., First
Reserve Corporation, Hercules, Inc., MIBRAG mbH, and several other organizations
including The Eisenhower Exchange Fellowships.
Charles R. Giesige was appointed Vice President and General Manager -
Dynasty Division in March 1999. Prior to joining C&D, Mr. Giesige spent 15 years
with Johnson Controls, Inc., a Fortune 200 global company and a leading supplier
of automotive seating, interiors and batteries and facility management and
control systems. In that time he held numerous financial and senior level
management positions, including General Manager of the Specialty Battery
Division.
Leslie S. Holden, F.R.I.C., Ph.D., has been Vice President - Battery
Technology since he joined C&D in September 1989.
Apostolos T. Kambouroglou was appointed Vice President - Operations
effective November 1997. He held the title of Vice President and General Manager
- - Motive Power Systems from February 1995 until November 1997. He joined C&D in
March 1991 as Plant Manager of the Conyers, Georgia plant, and subsequently held
the positions of Senior Director - Standby Operations and Vice President -
Operations, C&D Powercom.
Stephen E. Markert, Jr. was appointed Vice President - Finance and Chief
Financial Officer in February 1995. He joined C&D in May 1989 as Corporate
Controller.
Robert T. Marley was appointed Treasurer of C&D in August 1995. He joined
C&D in 1991 as Manager of Treasury Services and later held the position of
Treasurer of C&D's subsidiaries.
7
<PAGE>
Larry W. Moore was appointed Vice President and General Manager - Powercom
Division in January 1997. He joined C&D in December 1996 as Vice President of
Marketing for C&D Powercom and Ratelco Electronics. From 1995 to 1996, he was
President of MooreCom, a communications consulting firm he founded. Prior to
that time, through 1995, Mr. Moore spent over 30 years with AT&T where he held
various sales and marketing positions.
John J. Murray, Jr. was appointed Vice President and General Manager -
Motive Power Division in October 1997. Mr. Murray was the Principal of J. J.
Murray Associates, a marketing and management consultancy serving Fortune 500
clients, from 1993 to 1995, Vice President of Marketing and Sales for Gordon
Wahls Company, a national executive search company, from 1995 to 1996 and Senior
Consultant for Right Management Consultants, a global management consulting
firm, from 1996 to 1997.
Mark Z. Sappir was appointed Vice President - Human Resources in July 1998.
From 1988 through 1998, he held a series of senior level human resources
positions within both operating units and the corporate headquarters of Bayer
Corporation, a multinational chemical, healthcare product and imaging technology
company.
The Board of Directors has established a Compensation Committee (including
a Stock Option Subcommittee), an Audit Committee and a Corporate Governance and
Nominating Committee. The Compensation Committee reviews the compensation of
executives (including awards pursuant to our Incentive Compensation Plan) and
through its Stock Option Subcommittee administers our Stock Option Plans. The
Audit Committee, which is comprised of directors who are not officers or
employees of C&D, reviews the scope of the independent audit, our year-end
financial statements and such other matters relating to our financial affairs as
its members deem appropriate. The Corporate Governance and Nominating Committee
identifies and evaluates candidates for election as members of the Board of
Directors and reviews corporate policies (it will consider nominees recommended
by stockholders in writing to the Chairman of the Board).
The Board of Directors held four regular meetings and three special
meetings during the year ended January 31, 1999. The Compensation Committee,
Audit Committee and Corporate Governance and Nominating Committee each held two
meetings and the Stock Option Subcommittee held one meeting. During the last
fiscal year, each of the directors attended 75% or more of the meetings of the
Board and the committees of which he or she is a member, except for Alan G. Lutz
(a current director who is not standing for re-election).
8
<PAGE>
Executive Compensation
- ----------------------
The following table sets forth information concerning annual and long-term
compensation we paid for each of the last three fiscal years to our Chairman of
the Board, President and Chief Executive Officer (who has since retired) and
four other most highly compensated executive officers as of January 31, 1999
(two of whom are no longer employed by C&D) whose total annual salary and bonus
from C&D for the year then ended exceeded $100,000.
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
------------------- ------------
Securities
Underlying All
Options Other
Name & Fiscal Salary Bonus Granted Compensation
Principal Position Year ($) (1) ($) (2) (#) (3) ($) (4)
- ------------------------------- ---- -------- -------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Alfred Weber 1999 $464,220 $260,000 30,000 $ 5,117
Former Chairman of the Board, 1998 430,161 294,800 24,000 107,035 (5)
President and Chief 1997 392,312 191,500 68,000 4,905
Executive Officer
A. Gordon Goodyear 1999 189,167 43,000 5,000 5,037
Former Vice President and 1998 177,917 66,900 12,000 4,783
General Manager - 1997 165,833 60,000 28,000 4,652
Power Electronics Division
Leslie S. Holden 1999 164,033 59,200 6,500 4,484
Vice President - 1998 158,499 60,800 8,400 4,242
Battery Technology 1997 151,684 34,000 16,000 4,288
Stephen E. Markert, Jr. 1999 162,029 59,000 10,000 5,060
Vice President - 1998 145,921 66,000 9,000 4,773
Finance and Chief 1997 136,682 45,500 20,000 4,877
Financial Officer
Stephen J. Weglarz 1999 156,692 58,700 6,500 5,027
Former Corporate Counsel and 1998 148,470 60,700 9,000 4,783
Vice President-Legal and 1997 136,682 58,000 24,000 4,702
Regulatory Affairs
---------------
</TABLE>
(1) Does not include the value of certain personal benefits. The estimated
value of those personal benefits for each listed officer did not
exceed the lesser of $50,000 or 10% of the total annual salary and
bonus paid to that officer for the relevant fiscal year.
(2) Represents incentive compensation under our Incentive Compensation
Plan. Also includes payments to Messrs. Weber and Weglarz and Dr.
Goodyear of $20,000 each, and to Mr. Markert of $7,500 related to the
acquisition of Power Convertibles Corporation and LH Research, Inc. in
fiscal 1997.
(footnotes continue on following page)
9
<PAGE>
(3) All share data has been adjusted to reflect C&D's two-for-one stock
split, effected in the form of a 100% stock dividend, where
appropriate.
(4) Represents employer matching contributions under our Savings Plan.
(5) Includes $102,168 paid to Mr. Weber in fiscal 1998 to reimburse him,
on an after tax basis, for interest on a promissory note (see "Certain
Relationships and Related Transactions" below).
- ---------------
We entered into an employment agreement with Mr. Weber as of April 1, 1996
providing for a base salary of $400,000 per year, increasing by $35,000 per year
in each of the following three years. Mr. Weber retired after the end of the
last fiscal year. We will pay him his base salary as in effect on the date of
his retirement for one year and will continue certain benefits during that
period. Mr. Weber is subject to certain restrictions on competition with us for
a period of one year following his retirement.
We have also entered into employment agreements with Drs. Goodyear and
Holden and Messrs. Markert and Weglarz. Their annual base salaries under these
agreements are subject to increase during the course of the year by the
Compensation Committee of the Board of Directors. Upon that review, effective
April 1999, the base salaries of Drs. Goodyear and Holden and Messrs. Markert
and Weglarz were $191,000, $171,000, $175,000 and $158,000, respectively. Each
of these agreements is or was renewable automatically for successive terms of
one month each, unless terminated by either party upon 60 days prior notice in
the case of Drs. Goodyear and Holden and 30 days prior notice in the case of
Messrs. Markert and Weglarz. The agreements restrict each of Drs. Goodyear and
Holden and Messrs. Markert and Weglarz from competing with us for a period of
one year following the termination of his employment. Each of the agreements
also provide that if employment is terminated by us without cause or as a result
of the nonrenewal of the agreement, we must pay the employee his base salary in
effect at the date of termination for a one year period. Dr. Goodyear and Mr.
Weglarz are no longer employed by C&D.
Pension Plans
- -------------
The C&D TECHNOLOGIES, INC. Pension Plan for Salaried Employees (the
"Pension Plan") covers certain nonunion salaried employees of C&D who either
have participated in its predecessor company's pension plan or have completed
one year of service with C&D. The Pension Plan was amended during 1994, 1995 and
1998 to provide participation to salaried employees of certain of our
subsidiaries. The Pension Plan was amended in 1997 to eliminate the one year of
service eligibility requirement for covered employees. The Pension Plan is a
qualified plan under Section 401(a) of the Internal Revenue Code of 1986, as
amended (the "Code"). The Pension Plan is a noncontributory defined benefit plan
that provides for normal retirement benefits beginning at age 65 but permits
early retirement benefits in certain cases, subject to a reduction of benefits
for employees who retire earlier than age 62. Under the Pension Plan, the
pension payable at normal or late retirement equals 2.1% of a participant's
"average pay" (as defined below) during the highest paid five consecutive years
of the participant's last ten years of employment multiplied by the number of
years of credited service up to 15 (including service with our predecessor
company), plus 1.6% of that average pay for each year in excess of 15 years up
to a maximum of 15 additional years, reduced by .5% (the "Offset") of Covered
Compensation (35-year average of the Social Security wage base ending the year
prior to Social Security Normal Retirement Age) multiplied by the participant's
years of credited service up to 30 years. The term "average pay" as used in the
Pension Plan was amended January 1, 1994 to include salary, overtime, executive
incentive compensation, sales bonuses, 30% of sales commissions, and any tax
deferred contributions to C&D's savings plan. An unreduced disability benefit is
provided after ten years of eligibility service, and a death benefit to a
surviving spouse equal to approximately 50% of the value of the participant's
pension benefit at the time of death is provided after five years of eligibility
service or age 65. The Code places certain maximum limitations on the amount of
benefit which may be payable under a qualified pension
10
<PAGE>
plan such as the Pension Plan. The current limitation on an employee's annual
benefit is the lesser of $130,000 or the employee's average compensation for the
three years that he was most highly compensated.
The following table illustrates the total estimated annual pension benefits
that would be provided upon retirement under the benefit formula described above
to salaried employees for the specified remuneration and years of credited
service classifications set forth below. Benefit amounts shown are computed on a
straight life basis, prior to the Offset described above.
Years of Credited Service (1)(2)(3)
---------------------------------------------
Average Pay 5 10 20 30 40
----------------------- ------ ------ ------ ------ ------
$160,000 or greater (4) .... 16,800 33,600 63,200 88,800 88,800
- ---------------
(1) We expect that Dr. Holden and Mr. Markert will have 13 and 27 years of
credited service, respectively, at normal retirement. Mr. Weber had 10
years of credited service upon his retirement and Dr. Goodyear and Mr.
Weglarz had 8 and 9 years of credited service, respectively, when they
ceased to be employed by C&D.
(2) For the plan year ended December 31, 1998, the amount of remuneration,
for purposes of calculations under the Pension Plan, for Messrs.
Weber, Markert and Weglarz and Drs. Goodyear and Holden was $160,000.
(3) The maximum annual benefit of $130,000 will be reduced for pension
benefits which begin before, and increased for pension benefits which
begin after, the participant's Social Security Normal Retirement Age.
(4) Effective January 1, 1997, the maximum compensation limit is $160,000.
The limit was $150,000 from January 1, 1994 through December 31, 1996
and for years prior to January 1, 1994 the limit was $235,840. After
reflecting these limits, Mr. Weber's retirement benefit will be
$40,559 prior to the Offset.
We have adopted two Supplemental Executive Retirement Plans ("SERPs"), one
covering Mr. Weber, and the other covering executives specified from time to
time by the Board of Directors (presently including, among others, each of the
four other most highly compensated executive officers as of January 31, 1999).
The SERPs are non-qualified, unfunded defined benefit compensation plans whose
purpose is to provide upon retirement or other qualifying event additional
benefits to participants whose benefits under the Pension Plan have been
restricted by federal law. The normal form of benefit under the SERPs for an
unmarried participant is a monthly annuity ceasing on the participant's death
and for a married participant is a joint and 60% survivor annuity, although a
married participant may elect to have benefits paid in a monthly annuity,
subject to spousal consent. Participants become vested in their benefits under
the SERPs upon the earlier of the completion of 7 1/2 years of continuous
employment with C&D or an affiliate or a change in control. Mr. Weber's maximum
annual benefit will be $150,000 and the maximum annual benefit for other
participants is $100,000, in each case indexed annually by 4% beginning
September 30, 1998, reduced by (i) the annual accrued benefit as of the
retirement or other qualifying event (based on a monthly single life annuity)
payable with respect to Mr. Weber at age 66 and with respect to all other
participants at normal retirement age (as defined in the Pension Plan); (ii)
one-half of the participant's social security benefit (as defined in the SERPs)
that would be payable as of the retirement or other qualifying event; and (iii)
the annual single life annuity payable at age 66 to Mr. Weber and at age 65 to
all other participants based on the Actuarial Equivalent (as defined in the
SERPs) of the participant's account under our Savings Plan as of the retirement
or other qualifying event solely attributable to matching contributions made by
C&D. The actual annual benefits payable are the percentages
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<PAGE>
set forth below of the maximum annual benefit, based on the number of years of
employment prior to retirement or other qualifying event:
Years of Employment
Prior to Qualifying Event Percentage Benefit
------------------------- ------------------
less than 7.5 0%
7.5 50%
8 53.3%
9 60%
10 66.7%
11 73.3%
12 80%
13 86.7%
14 93.3%
15 or more 100%
Participants (other than Mr. Weber) who retire from C&D or an affiliate
before age 65 and after age 62 will receive the actual annual benefit calculated
above reduced by 7% per year prior to age 65.
For participants (other than Mr. Weber) who have been continuously employed
by C&D or an affiliate for at least five years, if the qualifying event is a
change of control, the actual annual benefit is determined by multiplying the
maximum annual benefit by a fraction (not to exceed 1), the numerator of which
is the number of years the participant would have been employed if he were
continuously employed by C&D or an affiliate through age 65, and the denominator
of which is 15. For participants (other than Mr. Weber) who have been
continuously employed by C&D or an affiliate for less than five years, the
actual annual benefit is 50% of the amount referred to in the previous sentence.
Benefits paid on account of a change of control are made in a single lump sum. A
participant's SERP benefit may be forfeited in certain circumstances including
where the participant is terminated for cause or violates a covenant not to
compete.
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<PAGE>
Option Grants in Fiscal 1999
- ----------------------------
The following table presents certain information concerning the stock
options we granted to our Chairman of the Board, President and Chief Executive
Officer (who has since retired) and the four other most highly compensated
executive officers (two of whom are no longer employed by C&D) pursuant to our
1998 Stock Option Plan in the year ended January 31, 1999.
<TABLE>
<CAPTION>
Individual Grants
--------------------------------------------------------------------------
Number of % of Total Grant
Securities Options Exercise Date
Underlying Granted to Price Present
Options Granted Employees in per Expiration Value
Name (#)(1) Fiscal Year Share Date (2) ($)(3)
- ----------------------- --------------- ------------ -------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Alfred Weber 30,000 10.6% $23.3125 9/29/08 $294,600
A. Gordon Goodyear 5,000 1.8% $23.3125 9/29/08 49,100
Leslie S. Holden 6,500 2.3% $23.3125 9/29/08 63,830
Stephen E. Markert, Jr. 10,000 3.5% $23.3125 9/29/08 98,200
Stephen J. Weglarz 6,500 2.3% $23.3125 9/29/08 63,830
- ---------------
</TABLE>
(1) The first 33 1/3% of the shares covered by these options will vest on
September 29, 1999, the second 33 1/3% of the shares covered by these
options will vest on September 29, 2000 and the remaining 33 1/3% of
the shares covered by these options will vest on September 29, 2001.
All of a participant's options vest in full upon the participant's
retirement, disability or death. Mr. Weber's options subsequently
vested in full upon his retirement.
(2) Each option is subject to earlier termination if the officer's
employment with C&D terminates. As a result, the options granted to
Messrs. Weber and Weglarz and Dr. Goodyear during the last fiscal year
are all expected to expire at various times prior to March 31, 2000.
(3) The options were valued using the Black-Scholes pricing model.
13
<PAGE>
Option Exercises in Last Fiscal Year and Fiscal 1999 Year-End Option Values
- ---------------------------------------------------------------------------
The following table presents certain information concerning the amount and
value of all unexercised stock options held by our Chairman of the Board,
President and Chief Executive Officer (who has since retired) and the four most
highly compensated executive officers as of January 31, 1999 (two of whom are no
longer employed by C&D).
<TABLE>
<CAPTION>
Value of Unexercised In-
Number of Securities the-Money Options at 1/31/99
Underlying Unexercised ----------------------------
Shares Options at 1/31/99 Exercisable Unexercisable
Acquired ---------------------- ---------------------- -------------------
on Value
Exercise Realized Exercisable Unexercisable Shares Value Shares Value
Name (#)(3) ($) (#)(3) (#)(3) (#)(3) ($)(1) (#)(3) ($)(1)
- ----------------------- --------- ---------- ----------- ------------- ------- ---------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Alfred Weber (2) 60,000 $1,533,460 213,333 68,667 213,333 $3,518,329 68,667 $301,046
A. Gordon Goodyear -- -- 65,667 22,333 65,667 1,031,546 22,333 121,142
Leslie S. Holden -- -- 13,467 17,433 13,467 129,296 17,433 72,235
Stephen E. Markert, Jr. 2,000 40,375 19,333 22,667 19,333 214,767 22,667 90,421
Stephen J. Weglarz -- -- 19,000 20,500 19,000 192,813 20,500 104,281
- --------------------
</TABLE>
(1) Represents the number of shares covered by the option multiplied by
the excess of (i) the closing price for shares of common stock
($23.875 per share) on January 31, 1999 over (ii) the aggregate
exercise price of the option.
(2) Mr. Weber's options subsequently vested in full upon his retirement.
(3) All share data has been adjusted to reflect C&D's two-for-one stock
split, effected in the form of a 100% stock dividend, where
appropriate.
Compensation of Directors
- -------------------------
We pay our non-employee directors (i) an annual retainer of $12,000
(payable in stock or, at the election of each director, in a combination of
stock and a sufficient amount of cash to pay income taxes owing on that amount),
(ii) for members of a committee of the Board of Directors other than the
chairperson, $1,000 for each in-person meeting and $500 for each telephonic
meeting of a committee attended and (iii) for the chairperson of a committee of
the Board of Directors, $1,500 for each in-person meeting or $750 for each
telephonic meeting of a committee attended; and, in addition, grants annually to
each non-employee director options to purchase 1,000 shares of common stock at
the closing price of the common stock on the date of grant. Messrs. Harral and
Shober each received a special payment of $5,000, and Mr. Lutz received a
special payment of $1,000, for their efforts in identifying and retaining a
successor to Mr. Weber.
Composition of Compensation Committee
- -------------------------------------
During fiscal 1999 the Compensation Committee consisted of Messrs. Harral,
Dowd and Feit. The Stock Option Subcommittee of the Compensation Committee
consisted of Messrs. Harral and Dowd.
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<PAGE>
Compensation Committee Report
- -----------------------------
COMPENSATION PHILOSOPHY. The principal goal of C&D's compensation
program as administered by the Compensation Committee is to help C&D
attract, motivate and retain the executive talent required to develop and
achieve C&D's strategic and operating goals with a view to maximizing
shareholder value. The key elements of this program and the objectives of
each element are as follows:
BASE SALARY
o Establish base salaries that are competitive with those payable
to executives holding comparable positions at similar-sized
industrial companies.
o Provide periodic base salary increases as appropriate, consistent
with C&D's overall operating and financial performance, with a
view to rewarding successful individual performance and keeping
pace with competitive compensation practices.
ANNUAL INCENTIVE
o Encourage both superlative individual effort and effective "team
play" by creating potential for earning annual incentive awards
based in part on C&D's achievement of budgeted earnings
objectives and in part on achievement of individual performance
objectives measuring the individual executive's contribution to
the key performance targets of the internal business unit within
which the executive functions or for which he is responsible.
o Set potential awards at levels that offer covered executives the
opportunity to earn incentive amounts equal to a significant
percentage (ordinarily at least 35% for the most senior
executives) of their base salaries for full achievement of all
company and individual objectives, with the opportunity to
selectively grant even larger awards to recognize outstanding
individual performance.
LONG-TERM INCENTIVE
o Facilitate the alignment of executives' interests with those of
our stockholders by providing opportunities for meaningful stock
ownership.
Summary of Actions Taken with Respect to the Chief Executive Officer.
The Compensation Committee reviews the performance of its Chief Executive
Officer at least once a year. For the year ended January 31, 1999, the
Compensation Committee took the actions with respect to Mr. Weber described
and discussed below.
BASE SALARY. C&D has employment agreements with its principal
executive officers that provide for annual reviews of their base
salary. Pursuant to the agreement with Mr. Weber, at the end of fiscal
year 1999, his base salary was $470,000.
ANNUAL INCENTIVE. Criteria for earning incentive awards pursuant
to C&D's Incentive Compensation Plan for the fiscal year ended January
31, 1999 were established for the principal executive officers by the
Compensation Committee early in the fiscal year, based in part on
substantial achievement of C&D's budgeted earnings per share and in
part on achievement of specified individual performance objectives.
Based on C&D and individual performance and the report of an
independent consultant who examined C&D's compensation policies, the
Compensation Committee granted a bonus award to Mr. Weber in the
amount of $260,000.
15
<PAGE>
STOCK OPTIONS. Based on the report of an independent consultant
who examined our compensation policies, the Stock Option Subcommittee
of the Compensation Committee granted Mr. Weber options to purchase
30,000 shares of common stock in September 1998.
William Harral, III
Kevin P. Dowd
Glenn M. Feit
Compensation Committee Interlocks and Insider Participation
- -----------------------------------------------------------
Messrs. Harral, Dowd and Feit served on the Compensation Committee for
the entire fiscal year ended January 31, 1999.
Mr. Harral beneficially owns 12,414 shares of common stock. Mr. Feit
is a member of the law firm of Proskauer Rose LLP, which provides legal
services to C&D, and also beneficially owns 4,414 shares of common stock.
Mr. Dowd beneficially owns 3,414 shares of common stock. The above shares
have been adjusted to reflect C&D's two-for-one stock split, effected in
the form of a 100% stock dividend.
16
<PAGE>
Stock Price Performance Graph
- -----------------------------
The following graph compares on a cumulative basis the yearly
percentage change, assuming quarterly dividend reinvestment over the last
five fiscal years, in the total stockholder return on the common stock,
with the total return on the New York Stock Exchange Market Value Index
(the "NYSE Market Value Index"), a broad entity market index and the total
return on a selected peer group index (the "SIC Code Peer Group Index").
The SIC Code Peer Group is based on the standard industrial classification
codes ("SIC Codes") established by the government. The index chosen was
"Miscellaneous Electrical Equipment and Supplies" and is comprised of all
publicly traded companies having the same 3-digit SIC Code (369) as C&D.
The price of each unit has been set at $100 on January 31, 1994 for the
purpose of preparation of the graph.
Comparison of Five-Year Cumulative Total Return
-----------------------------------------------
Among C&D TECHNOLOGIES, INC., NYSE Market Value
Index and SIC Code Peer Group Index
Performance Results through January 31, 1999
Fiscal Year C&D NYSE Peer Group
----------- --- ---- ----------
1994 100.0 100.0 100.0
1995 176.3 95.4 109.4
1996 226.2 129.2 133.0
1997 295.8 158.4 159.2
1998 420.4 198.6 224.3
1999 411.9 238.4 221.8
17
<PAGE>
COMPLIANCE WITH SECTION 16(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires our
directors, executive officers, and beneficial owners of more than 10% of the
common stock to file with the Securities and Exchange Commission initial reports
of ownership and periodic reports of changes in ownership of the common stock
and to provide copies of those filings to us. Based upon a review of those
copies and written representations, we believe that for the year ended January
31, 1999, Mr. Moore failed to timely file one report with respect to two
transactions, which has since been filed.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On April 30, 1996, Mr. Weber exercised an option to purchase 110,000
(220,000 after adjustment for stock split) shares of common stock at $6.04 per
share, pursuant to an Option Agreement dated May 30, 1989, as amended. We loaned
Mr. Weber $1,057,138 to pay the tax withholding on the exercise of that option,
evidenced by a secured promissory note, bearing interest at 5.33% per annum
payable annually, and due on April 29, 1997, subject to extension until April
29, 1999 at the option of Mr. Weber. Mr. Weber extended the note on April 29,
1997 until April 29, 1999, but repaid it in full on April 29, 1998.
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
Based upon the recommendation of the Audit Committee, the Board of
Directors has reappointed PricewaterhouseCoopers LLP as C&D's independent
accountants for the fiscal year ending January 31, 2000. In the absence of
instructions to the contrary, the shares of common stock represented by a proxy
delivered to the Board of Directors will be voted FOR the ratification of the
appointment of PricewaterhouseCoopers LLP. A representative of
PricewaterhouseCoopers LLP is expected to be present at the Annual Meeting of
Stockholders, will be available to respond to appropriate questions and, if he
so desires, may make a statement.
The Board of Directors recommends a vote FOR the ratification of the
appointment of PricewaterhouseCoopers LLP as our independent accountants for the
fiscal year ending January 31, 2000.
ANNUAL REPORT
We are mailing our Annual Report for the fiscal year ended January 31, 1999
together with this Proxy Statement to stockholders of record of C&D at the close
of business on May 10, 1999. We will provide additional copies, without charge,
upon the request of stockholders. To obtain copies, you should contact us at C&D
TECHNOLOGIES, INC., 1400 Union Meeting Road, Blue Bell, Pennsylvania 19422,
Attention: Vice President-Finance and Chief Financial Officer.
18
<PAGE>
OTHER BUSINESS
The Board of Directors does not know of any other business to be presented
to the meeting and does not intend to bring any other matters before the
meeting. However, if any other matters properly come before the meeting or any
adjournments thereof, it is intended that the persons named in the accompanying
proxy will vote on those matters according to their best judgment in the
interests of C&D.
BY ORDER OF THE BOARD OF DIRECTORS
GLENN M. FEIT
Secretary
We request that you date and sign the enclosed proxy and return it in the
enclosed, self-addressed envelope. No postage is required if you mail it in the
United States. Your prompt response will be helpful, and we appreciate your
cooperation.
19
<PAGE>
PROXY
C&D TECHNOLOGIES, INC.
1400 UNION MEETING ROAD, BLUE BELL, PENNSYLVANIA 19422
SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING
OF STOCKHOLDERS ON JUNE 29, 1999
The undersigned hereby appoints Wade H. Roberts, Jr., Stephen E. Markert,
Jr. and Glenn M. Feit, or any of them, with the power of substitution, as
proxies and hereby authorizes them to represent and to vote, as designated
below, all shares of Common Stock of C&D TECHNOLOGIES, INC. held of record by
the undersigned at the close of business on May 10, 1999, at the Annual Meeting
of Stockholders to be held on Tuesday, June 29, 1999, and at any adjournments of
that meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2.
1. Election of Directors:
[ ] For all nominees listed below (except for any individual nominees
whose names you strike through):
William Harral, III Wade H. Roberts, Jr. Kevin P. Dowd
Glenn M. Feit Pamela S. Lewis George MacKenzie John A. H. Shober
[ ] Withhold authority to vote for all nominees listed above.
2. Ratification of the appointment of PricewaterhouseCoopers LLP as
independent accountants for the fiscal year ending January 31, 2000:
[ ] For [ ] Against [ ] Abstain
(Continued and to be signed on other side)
<PAGE>
(Continued from other side)
3. In their discretion, the Proxies are authorized to vote upon any other
business that may properly come before the meeting and any adjournments of
the meeting.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS
GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2. PLEASE SIGN EXACTLY AS
YOUR NAME APPEARS BELOW.
Dated: ___________________________________, 1999
___________________________________
Signature
___________________________________
Representative Capacity (if any)
Please sign exactly as your name appears on this Proxy. If
you are signing in a representative capacity (for example,
as attorney, executor, administrator, guardian, trustee, or
the officer or agent of a company), you should indicate your
name and title or capacity. If you hold the stock in custody
for a minor (for example, under the Uniform Transfers to
Minors Act), you should sign as custodian, not the minor. If
you hold the stock in joint ownership with another person or
persons, one owner may sign on behalf of all the owners.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY, USING THE ENCLOSED
ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES OF AMERICA.
