SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. ____)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
LADISH CO., INC.
(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)(4) and 0-
11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date
of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
LADISH CO., INC.
5481 South Packard Avenue
Cudahy, Wisconsin 53110
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
To Stockholders:
An Annual Meeting of Stockholders of Ladish Co., Inc., a Wisconsin
corporation (the "Company"), will be held in the Creole Meeting Room of
the Grand Milwaukee Hotel located at 4747 South Howell Avenue, Milwaukee,
Wisconsin on Tuesday, August 25, 1998 at 10:00 a.m. Central Daylight Time,
for the following purposes:
(1) To elect five (5) Directors, to serve for the term of one
year or until their successors have been elected and have duly
qualified.
(2) To transact such other business as may properly come
before the meeting or any adjournment thereof.
Only Stockholders of record at the close of business on July 15, 1998
will be entitled to notice of and to vote at the 1998 Annual Meeting or
any adjournment thereof, notwithstanding the transfer of any stock on the
books of the Company after such record date.
A Proxy Statement and proxy card accompany this Notice of Annual
Meeting of Stockholders.
Wayne E. Larsen
Secretary
Cudahy, Wisconsin
July 17, 1998
<PAGE>
Ladish Co., Inc.
5481 South Packard Avenue
Cudahy, Wisconsin 53110
PROXY STATEMENT
For
ANNUAL MEETING OF STOCKHOLDERS
To Be Held on August 25, 1998
This Proxy Statement is furnished to the stockholders of Ladish Co.,
Inc. (the "Company") in connection with the solicitation of proxies by the
Board of Directors of the Company to be voted at the Annual Meeting of
Stockholders of the Company to be held at the Grand Milwaukee Hotel,
Creole Meeting Room, 4747 South Howell Avenue, Milwaukee, Wisconsin on
Tuesday, August 25, 1998 at 10:00 a.m., Central Daylight Time (the "1998
Annual Meeting"), or at any adjournment thereof, for the purposes set
forth in the accompanying Notice of Annual Meeting of Stockholders.
This Proxy Statement and the enclosed form of proxy are being mailed
to stockholders on or about July 17, 1998.
RIGHT TO REVOKE PROXY
Any stockholder giving the proxy enclosed with this Proxy
Statement has the power to revoke such proxy at any time prior to the
exercise thereof by filing with the Company a written revocation at or
prior to the 1998 Annual Meeting, by executing a proxy bearing a later
date or by attending the 1998 Annual Meeting and voting in person the
shares of stock that such stockholder is entitled to vote. Unless the
persons named in the proxy are prevented from acting by circumstances
beyond their control, the proxy will be voted at the 1998 Annual Meeting
and at any adjournment thereof in the manner specified therein, or if not
specified, the proxy will be voted:
(1) FOR the election of the five (5) nominees listed under "Election
of Directors" as nominees of the Company for election as directors to hold
office until the next Annual Meeting of Stockholders or until their
successors are elected and qualified;
(2) At the discretion of the persons named in the enclosed form of
proxy, on any other matter that may properly come before the 1998 Annual
Meeting or any adjournment thereof.
BY WHOM AND THE MANNER IN WHICH PROXY IS BEING SOLICITED
The enclosed proxy is solicited by and on behalf of the Board of
Directors of the Company. The expense of the solicitation of proxies for
the 1998 Annual Meeting, including the cost of mailing, will be borne by
the Company. To the extent necessary to assure sufficient representation
at the 1998 Annual Meeting, officers and regular employees of the Company,
at no additional compensation, may request the return of proxies
personally, by telephone, facsimile, mail, or other method. The extent to
which this will be necessary depends entirely upon how promptly proxies
are received. Stockholders are urged to send in their proxies without
delay. The Company will supply brokers, nominees, fiduciaries and other
custodians with proxy materials to forward to beneficial owners of shares
in connection with the request from the beneficial owners of authority to
execute such proxies, and the Company will reimburse such brokers,
nominees, fiduciaries and other custodians for their expenses in making
such distribution. Management has no knowledge or information that any
other person will specially engage any persons to solicit proxies.
VOTING SECURITIES AND STOCKHOLDERS
The outstanding voting securities of the Company consist entirely of
shares of Common Stock, $0.01 par value per share, each share of which
entitles the holder thereof to one vote. The record date for the
determination of the stockholders entitled to notice of and to vote at the
1998 Annual Meeting, or any adjournment thereof, has been established by
the Board of Directors as the close of business on July 15, 1998. At that
date, there were outstanding and entitled to vote 14,013,667 shares of
Common Stock.
The presence, in person or by proxy, of the holders of record of a
majority of the outstanding shares of Common Stock entitled to vote is
necessary to constitute a quorum for the transaction of business at the
1998 Annual Meeting, but if a quorum should not be present, the meeting
may be adjourned from time to time until a quorum is obtained. A holder
of Common Stock will be entitled to one vote per share on each matter
properly brought before the meeting. Cumulative voting is not permitted
in the election of directors.
The proxy card provides space for a stockholder to withhold voting
for any or all nominees for the Board of Directors or to abstain from
voting for any proposal if the stockholder chooses to do so. Under
Wisconsin law, directors are elected by a plurality of the votes cast at
the meeting. Each matter to be submitted to the stockholders requires the
affirmative vote of a majority of the votes cast at the meeting. For
purposes of determining the number of votes cast with respect to any
voting matter, only those cast "for" or "against" are included.
Abstentions and broker non-votes are counted only for purposes of
determining whether a quorum is present at the meeting.
As of July 15, 1998, no person was known by the Company to own
beneficially more than five percent (5%) of the outstanding shares of
Common Stock of the Company, except as shown in the following table:
Number of Shares
Name and Address Beneficially Owned Percent
Of Beneficial Owner At July 15, 1998 Of Class
Grace Brothers Ltd. 1 2,862,573 20.4%
1650 Sherman Avenue,
Suite 900
Evanston, Illinois 60201
Franklin Principal Maturity 1,703,429 11.5%
Trust 2
777 Mariners Island Boulevard
San Mateo, California 94404
TCW Group, Inc. 1 1,449,625 10.3%
11100 Santa Monica Blvd,
Suite 2000
Los Angeles, California 90025
Crabbe & Huson 3 742,900 5.3%
121 SW Morrison, Suite 1400
Portland, Oregon 97204
------------
1 Information regarding Grace Brothers Ltd. and TCW Group, Inc. and their
beneficial ownership of the Company's shares was obtained from the
Schedule 13G of Grace Brothers Ltd. dated May 5, 1998 and the Schedule 13G
of TCW Group, Inc. dated July 9, 1998.
2 Consists of 957,533 shares of Common Stock of the Company and 746,096
warrants which are convertible into Common Stock of the Company on a one-
for-one basis with an exercise price of $1.20 per share.
3 Information regarding Crabbe & Huson represents the purchases made in
the IPO for the Company's Common Stock and to the best of the Company's
knowledge represents the current ownership of the firm.
The following table shows the number of shares of Common Stock
beneficially owned by each director or nominee, by the executive officers
named below in the Summary Compensation Table and by all directors,
nominees and executive officers as a group, based upon information
supplied by them:
Number of Shares
Beneficially Owned Percent
Name At July 15, 1998 1 Of Class
Lawrence W. Bianchi 0 --
Charles W. Finkl 0 --
Lawrence C. Hammond 9,082 *
Wayne E. Larsen 12,500 *
Robert J. Noel 16,436 *
Robert W. Sullivan 83 *
Gary J. Vroman 14,833 *
Kerry L. Woody 29,167 *
Directors and Executive Officers
as a Group (12 persons) 102,101 *
* Less than one percent (1%)
-------------
1 Unless otherwise noted, all shares are owned directly and the owner has
the right to vote the shares, except for shares that officers and
directors have the right to acquire under the Company's stock option plans
as of the record date or within sixty (60) days thereafter, which for
Messrs. Woody, Larsen, Noel, Vroman and Hammond are 29,167, 12,500,
12,500, 12,500 and 8,333 shares, respectively.
Kerry L. Woody, 47. Director since 1997. Mr. Woody has been
President since 1995 and was appointed Chief Executive Officer of the
Company in 1998. Prior to that time he was Vice President-Operations,
Vice President-Manufacturing Services and Production Manager. He joined
the Company in 1975. Mr. Woody is also a director and President of Stowe
Machine Co., Inc. Mr. Woody has a B.S. in Engineering from Milliken
University.
Wayne E. Larsen, 43. Director since 1997. Since 1995 Mr. Larsen has
been Vice President Law/Finance and Secretary of the Company. He served
as General Counsel and Secretary from 1989 after joining the Company as
corporate counsel in 1981. He is also a director and Vice President and
Secretary of Stowe Machine Co., Inc. Mr. Larsen is a Trustee of the
Ladish Co. Foundation. Mr. Larsen has a B.A. from Marquette University
and a J.D. from Marquette Law School.
Gene E. Bunge, 52. Mr. Bunge has served as Vice President,
Engineering since November 1991. From 1985 until that time he was General
Manager of Engineering. Mr. Bunge has been with the Company since 1973.
He has a B.S.E.E. from the Milwaukee School of Engineering.
Robert J. Noel. 57. Mr. Noel has been Vice President, Quality and
Technology since March 1991. He has been Manager of Metallurgy since 1985
and prior to that period was a Product Metallurgist for jet engine
components. Mr. Noel has been with the Company since 1963. He has a B.S.
in Mechanical Engineering from Marquette University.
James K. Sorenson, 60. Mr. Sorenson has served as Vice President,
Materials Management since March 1991. Prior to that time he had been
Purchasing Manager, Production Manager, and Head Buyer. Mr. Sorenson has
been with the Company since 1963. He has a B.S. in Mechanical Engineering
from the University of Wisconsin.
Gary J. Vroman, 38. Mr. Vroman has served as Vice President, Sales
and Marketing since December 1995. From January 1994 to December 1995 he
was General Manager of Sales. Prior to that period he had been the
Product Manager for jet engine components. Mr. Vroman has been with the
Company since 1982. He has a B.S. in Engineering from the University of
Illinois and a M.S. in Engineering Management from the Milwaukee School of
Engineering.
Lawrence C. Hammond, 50. Mr. Hammond has served as Vice President,
Human Resources since January 1994. Prior to that time he had served as
Director of Industrial Relations at the Company and he had been Labor
Counsel at the Company. Mr. Hammond has been with the Company since 1980.
He has a B.A. and a Masters in Industrial Relations from Michigan State
University and a J.D. from the Detroit College of Law.
Ronald O. Wiese, 64. Mr. Wiese has served as Treasurer since May
1989. He was Assistant Treasurer of the Company since 1986 and was its
Tax Manager from 1982 to 1986. Mr. Wiese has been with the Company since
1955. He holds a B.S. in Accounting from Marquette University.
Thomas S. Plichta, 55. Mr. Plichta has served as Corporate
Controller since May 1989. He served as Assistant Corporate Controller
for more than five years prior to that time. Mr. Plichta has been with
the Company since 1965. He has a B.S. in Accounting from Marquette
University.
ITEM 1 - ELECTION OF DIRECTORS
At the 1998 Annual Meeting, five (5) directors are to be elected who
shall hold office until the next Annual Meeting of Stockholders or until
their respective successors are duly elected and qualified. It is the
intention of the persons named in the Company's proxy to vote for the
election of each of the five (5) nominees listed below, unless authority
is withheld. All nominees have indicated a willingness to serve as
directors, but if any of them should decline or be unable to serve as a
director, the persons named in the proxy will vote for the election of
another person recommended by the Board of Directors.
The Board of Directors recommends you vote FOR the election of each
of the five (5) nominees to the Board of Directors set forth below.
Nominees
Lawrence W. Bianchi, 57. Director since 1998. Mr. Bianchi in 1993
retired as the Managing Partner of the Milwaukee, Wisconsin office of KPMG
Peat Marwick. From 1994 to 1998 Mr. Bianchi served as CFO of the law firm
of Foley & Lardner. Mr. Bianchi's principal occupation is investments.
Charles W. Finkl, 77. Director since 1998. Mr. Finkl is a director and
the Chairman and Chief Executive Officer of A. Finkl & Sons, Co., a
Chicago, Illinois based metals processor, a position he has held for more
than ten years.
Wayne E. Larsen, 43. Director since 1997. Since 1995 Mr. Larsen has been
Vice President Law/Finance and Secretary of the Company. He served as
General Counsel and Secretary from 1989 after joining the Company as
corporate counsel in 1981. He is also a director and Vice President and
Secretary of Stowe Machine Co., Inc. Mr. Larsen is a Trustee of the
Ladish Co. Foundation.
Robert W. Sullivan, 39. Director since 1993. Mr. Sullivan has been
President of The Martec Group, a sales and marketing consulting group for
more than five years. Mr. Sullivan is also a director of The Chicago Fish
Market.
Kerry L. Woody, 47. Director since 1997. Mr. Woody has been President
since 1995 and was appointed Chief Executive Officer of the Company in
1998. Prior to that time he was Vice President-Operations, Vice
President-Manufacturing Services and Production Manager. He joined the
Company in 1975. Mr. Woody is also a director and President of Stowe
Machine Co., Inc.
BOARD MEETINGS AND COMMITTEES
The directors hold regular quarterly meetings, in addition to the
meeting immediately following the Annual Meeting of Stockholders, attend
special meetings, as required, and spend such time on the affairs of the
Company as their duties require. During the fiscal year ended December
31, 1997, the Board of Directors held five (5) meetings. All directors of
the Company attended at least seventy-five percent (75%) of the meetings
of the Board of Directors and the committees on which they served during
the fiscal year ended December 31, 1997.
During most of the fiscal year ended December 31, 1997, there were
only two committees, those being an Audit Committee and a Compensation
Committee. The entire Board of Directors function as members of the Audit
Committee. The Audit Committee is responsible for recommending annually a
firm of independent certified public accountants to serve as the Company's
auditors, to meet with and review reports of the Company's auditors and
the fees payable to them. The Audit Committee met two times in 1997 for
such purpose.
COMPENSATION COMMITTEE REPORT
The members of the Compensation Committee were Robert W. Sullivan,
Kerry L. Woody and a former director who resigned following the initial
public offering of the Company's stock. The Compensation Committee is
responsible for (i) setting the overall policy of the Company's executive
compensation program; (ii) establishing the base salary level for the
executive officers; (iii) reviewing and approving the annual incentive
program for the Company executives; and (iv) functions as the
administrator of the Company's 1996 Long Term Incentive Plan. The
Compensation Committee met once in 1997. The Company's executive
compensation program is designed to be closely linked to corporate
performance and returns to stockholders. To this end, the Company has
developed an overall compensation strategy and specific compensation plan
that tie a very significant portion of executive compensation to the
Company's success in meeting specified performance goals. In addition,
through the use of stock options, the Company ensures that a part of the
executives' compensation is closely tied to appreciation in the Company's
stock price. The overall objectives of this strategy are to attract and
retain the best possible executive talent, to motivate these executives to
achieve the goals inherent in the Company's business strategy, to link
executive and stockholder interests through equity based plans and,
finally, to provide a compensation package that recognizes individual
contributions as well as overall business results.
By the Compensation Committee
Robert W. Sullivan
Kerry L. Woody
COMPENSATION OF DIRECTORS
Non-employee directors receive an annual fee of twenty thousand
dollars ($20,000.00) which is payable quarterly. In addition, directors
who are not officers or employees of the Company receive a fee of one
thousand dollars ($1,000.00) for each meeting personally attended.
EXECUTIVE COMPENSATION AND OTHER MATTERS
The following table sets forth information for the Company's fiscal
years ended December 31, 1997, 1996 and 1995, with regard to the
compensation for their services to the Company of the Chief Executive
Officer and each of the other four (4) most highly compensated executive
officers serving the Company at the close of the Company's most recently
completed fiscal year.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term
Annual Compensation Compensation
Name and
Principal Position Year Restricted Stock Option
Other Annual Stock Awards Awards All Other
Salary Bonus 1 Compensation 2 (Shares) (Shares) Compensation 3
<S> <C> <C> <C> <C> <C> <C> <C>
Kerry L. Woody 1997 $200,000 $136,000 $1,776 -- -- $4,799
President & Chief 1996 $200,000 $64,000 $1,608 -- 100,000 $4,799
Executive Officer 1995 $125,000 -- $1,608 -- -- --
Wayne E. Larsen 1997 $155,000 $54,000 $1,776 -- -- $3,464
Vice President 1996 $120,000 $30,000 $1,608 -- 50,000 $3,464
Law/Finance & 1995 $105,000 -- $1,608 -- -- --
Secretary
Robert J. Noel 1997 $140,000 $35,000 $1,800 -- -- $1,633
Vice President 1996 $140,000 $26,000 $1,776 -- 50,000 $1,633
Quality & Technology 1995 $105,000 -- $1,776 -- -- --
Gary J. Vroman 1997 $130,000 $39,000 $1,776 -- -- $2,460
Vice President 1996 $130,000 $26,000 $1,608 -- 50,000 $2,460
Sales & Marketing 1995 $100,000 -- -- -- -- --
Lawrence C. Hammond 1997 $125,000 $37,500 $1,776 -- -- $3,426
Vice President 1996 $125,000 $26,000 $1,608 -- 33,333 $3,426
Human Resources 1995 $100,000 -- $1,608 -- -- --
-------------
1 An incentive bonus is paid only upon the achievement of a predetermined
financial objective set each year by the Board of Directors' Compensation
Committee at the beginning of the fiscal year. There was no incentive
bonus plan in place for fiscal 1995.
2 Other annual compensation includes supplemental life insurance provided
to the above listed executives.
3 All other compensation consists principally of automobile allowances.
</TABLE>
INCENTIVE STOCK OPTION PLAN
The Ladish Co., Inc. 1996 Long-Term Incentive Plan (the "Incentive
Plan") has been established by the Company to promote the long-term
financial interest of the Company by providing for the award of equity-
based incentives to key employees and other persons providing material
services to the Company. The Incentive Plan provides a means whereby such
individuals may acquire shares of Common Stock through the grant of stock
options and stock appreciation rights.
The Incentive Plan is not subject to any provision of ERISA or
qualified under Section 401(a) of the Code.
The number of shares of Common Stock subject to awards under the
incentive Plan may not exceed 833,333, of which 433,333 have been issued
as of December 31, 1997, or are subject to outstanding options and 400,000
have been reserved for issuance under future grants. The number of shares
underlying awards made to any one individual in any one-year period may
not exceed 166,667 shares. The Common Stock issued under the Incentive
Plan may be shares currently authorized but unissued or currently held or
subsequently acquired by the Company as treasury shares.
The number of shares subject to the Incentive Plan and the terms of
any outstanding award may be adjusted as described in the Incentive Plan
to reflect certain changes in the capitalization of the Company.
The authority to manage and control the operation and administration
of the Incentive Plan is vested in a committee selected by the Board of
Directors of the Company (the "Committee") which shall consist of two or
more members of the Board. The Committee has the authority and discretion
to determine the individuals who will receive awards under the Incentive
Plan and to determine the time of receipt, type of award, the number of
shares covered by such award and the terms, conditions, performance
criteria, restrictions and other provisions applicable to such award. The
Committee also has the authority and discretion to interpret the Incentive
Plan and to establish, amend and rescind any rules and regulations
relating to the Incentive Plan. Any interpretation of the Incentive Plan
by the Committee and any decision made by it under the Incentive Plan is
final and binding on all persons.
Subject to the terms and provisions of the Incentive Plan, a
participant to whom a stock option is granted will have the right to
purchase the number of shares of Common Stock covered by the option.
Subject to the conditions and limitations of the Incentive Plan, the
Committee shall determine all of the terms and conditions of such grant,
including without limitation, the option price, any vesting schedule and
the period of exercisability.
No option may be exercised after its expiration date. The expiration
date shall be determined by the Committee at the time of grant, but may
not be later than the earliest to occur of: (i) the ten-year anniversary
of the grant date; (ii) if the participant's termination of employment
with Company and its affiliates occurs by reason of death or disability
(as defined in the Incentive Plan), the one-year anniversary of such
termination of employment; (iii) if the participant's termination of
employment with the Company and its affiliates occurs by reason of
retirement, the three-month anniversary of such termination of employment;
or (iv) if the participant's termination with the Company and its
affiliates occurs for any other reason, the date of such termination.
The full purchase price of each share of Common Stock purchased upon
the exercise of an option shall be paid at the time of such exercise in
cash or in shares of Common Stock (valued at fair market value as of the
date of exercise) that have been held by the participant at least six
months, or in any combination thereof, as determined by the Committee. To
the extent provided by the Committee, a participant may elect to pay the
purchase price upon the exercise of an option through a cashless exercise
arrangement.
Options awarded under the Incentive Plan may be nonqualified options
or incentive stock options, as determined in the discretion of the
Committee. Under the terms of the Incentive Plan, the Committee may also
issue stock appreciation rights ("SARs"). Upon exercise, a SAR entitles
the holder thereof to a payment equal to the excess of the fair market
value of a share of stock on the exercise date over the fair market value
of a share of stock on the grant date. If the Committee so determines,
SARs may be issued in tandem with stock options.
Generally, options and SARs are not transferable prior to the
participant's death. However, the Committee may provide that an option or
SAR award may be transferred to an immediate family member or to a trust
for the benefit of an immediate family member.
Upon a change in control of the Company (as defined in the Incentive
Plan), all options and SARs shall become immediately exercisable.
The Board of Directors of the Company may amend or terminate the
Incentive Plan at any time, provided that no such amendment or termination
may materially adversely affect the rights of any participant or
beneficiary under any award made under the plan prior to the date such
amendment is adopted by the Board.
No stock options were granted to any of the Named Executive Officers
during 1997.
<TABLE>
<CAPTION>
Aggregated Option Exercises in 1997 and Fiscal Year-End Option Values
Number of Number of Shares Underlying Value of Unexercised
Shares Acquired Value Unexercised Options at In-the-Money
Name on Exercise Realized Fiscal Year-End Options at Fiscal Year-End
Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Kerry L. Woody 20,833 $250,000 29,167 50,000 $87,500 $150,000
Wayne E. Larsen 12,500 $150,000 12,500 25,000 $37,500 $75,000
Robert J. Noel 12,500 $150,000 12,500 25,000 $37,500 $75,000
Gary J. Vroman 12,500 $150,000 12,500 25,000 $37,500 $75,000
Lawrence C. Hammond 8,333 $100,000 8,333 16,667 $25,000 $50,000
</TABLE>
PENSION BENEFITS
Defined Benefit Plan. The Ladish Co., Inc. Salaried Pension Plan
(the "Pension Plan") is a "defined benefit" pension plan generally
covering salaried, non-union employees of the Company who are not covered
by any other defined benefit plan to which the Company makes contributions
pursuant to a collective bargaining agreement.
Upon reaching normal retirement at or after age 65, a participant is
generally entitled to receive an annual retirement benefit for life. The
Pension Plan provides alternative actuarially equivalent forms of benefit
payment. Vesting under the Pension Plan occurs after five years of
continued service.
The monthly retirement benefit at the normal retirement age of at
least 65 is determined pursuant to a formula as follows: 1.1% of the
average base salary (exclusive of bonuses or other incentive or special
compensation) of the individual during the consecutive five year period of
service within the ten years preceding termination of employment (or after
age 45, if longer) that his/her earnings were highest is multiplied by the
number of years of Benefit Service (as defined). Monthly normal
retirement benefits are payable on a straight life annuity basis and such
amounts are not subject to any deduction for Social Security or other
offset amounts.
The following table sets forth the annual benefits payable to a
participant who qualifies for normal retirement in 1997, with the
specified highest average earnings during the consecutive five year period
of service within the ten years prior to retirement and the specified
years of Benefit Service:
Average Annual
Earnings for
Highest 5-Year
Period Within
the 10-Years
Preceding
Retirement Years of Benefit Service
10 15 20 25 30 35
$50,000 $5,500 $8,250 $11,000 $13,750 $16,500 $19,250
$95,000 $10,450 $15,675 $20,900 $26,125 $31,350 $36,575
$100,000 $11,000 $16,500 $22,000 $27,500 $33,000 $38,500
$150,000 $16,500 $24,750 $33,000 $41,250 $49,500 $57,750
$200,000 $22,000 $33,000 $44,000 $55,000 $66,000 $77,000
$250,000 $27,500 $41,250 $55,000 $68,750 $82,500 $96,250
The years of Benefit Service for Messrs. Woody, Larsen, Noel, Vroman
and Hammond as of January 1, 1998 were 23, 17, 35, 16 and 18,
respectively.
Deferred Compensation Agreements. The Company has entered into
deferred compensation agreements (the "Agreements") with nine current
officers of the Company, including Messrs. Woody, Larsen, Noel, Vroman and
Hammond. Each employee covered by the Agreements (an "Employee"), upon
full vesting, is entitled to receive supplemental disability or retirement
benefits; provided that in no event may a person's total retirement
benefits under the Agreements exceed 52.5% of the monthly average base
salary (inclusive of bonuses or other compensation) during the five
calendar years immediately preceding retirement.
The retirement benefit at the normal retirement age of at least 65 is
determined pursuant to a formula as follows: 52.5% of the monthly average
of the Employee's base salary during the five calendar years of highest
compensation over ten years immediately preceding retirement multiplied by
years of service, up to 35, and divided by 35. If an Employee suffers a
disability (as defined), he is entitled to benefits paid under the same
formula as in the preceding sentence (with his years of service calculated
as if he had retired at age 65), reduced by other disability benefits paid
by the Company or through workers' compensation (unless he is receiving
fixed statutory payments for certain bodily injuries).
Any amount to be paid under the Agreement shall be reduced by any
benefit paid to an Employee or his beneficiary pursuant to the Pension
Plan.
Defined Contribution Plan. The Ladish Co., Inc. Savings and Deferral
Investment Plan ("SDIP"), which has been qualified under section 401(k) of
the Code, provides that salaried, non-union employees with six months'
service may contribute 1% to 18% of their annual base salary to SDIP and
the Company will provide a matching contribution in an amount to be
determined by the Board of Directors of the Company. Employees'
contributions of 1% to 18% can be "before tax" contributions, "after tax"
contributions or a combination of both. The employees' contributions and
the matching Company contribution may be placed by the employee in a fixed
income fund, an equity investment fund or various combinations of each.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with Messrs.
Woody, Larsen, Noel, Vroman and Hammond which are substantially similar in
all respects. The basic employment agreement provides for a number of
benefits, all of which vest after ten years of employment, including group
term life insurance, health and dental coverage and long-term disability
coverage.
The agreements provide that, upon the involuntary termination of the
employee other than for cause, the Company is required to pay the employee
up to 24 months of severance pay, determined by multiplying the employee's
years of service by the employee's base monthly salary at the time of
termination. In the case of Messrs. Woody and Larsen, should they be
terminated due to a change of control or ownership, they are entitled to
24 months of severance pay. Upon retirement at age 65, the employee will
receive his normal retirement benefits. Such benefits include a monthly
payment equal to 52.5% of the employee's average compensation (i.e.,
monthly average of compensation for the five years of highest compensation
over the ten years prior to retirement) multiplied by a fraction, the
numerator of which is the length of service of the employee and the
denominator of which is 35. There are also provisions adjusting this
calculation in the event of early retirement. Disabled employees can also
be eligible for certain retirement benefits. All retirement benefits are
tolled during any period of re-employment. Each agreement further
provides that any compensation paid by the Company shall be reduced by any
benefit paid under the Company's salaried employees' retirement plan.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers, directors and persons who own more than ten
percent (10%) of the Company's Common Stock to file initial reports of
ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). These reports are also filed with Nasdaq and a copy
of each report is furnished to the Company.
Additionally, SEC regulations require that the Company identify any
individuals for whom one of the referenced reports was not filed on a
timely basis during the most recent fiscal year. To the Company's
knowledge, based on review of reports furnished to it, each individual who
was required to file such report following the Company's registration in
March 1998 with the SEC did so, but none of such filings was made timely.
RELATIONSHIP WITH INDEPENDENT AUDITORS
Arthur Andersen LLP, independent auditors, or a predecessor of that
firm, have been the auditors of the accounts of the Company each year
since 1993, including the fiscal year ended December 31, 1997. It is
anticipated that representatives of Arthur Andersen LLP will be present at
the 1998 Annual Meeting, will have the opportunity to make a statement if
they so desire and will be available to respond to appropriate questions
raised at the 1998 Annual Meeting or submitted to them in writing before
the 1998 Annual Meeting.
Arthur Andersen LLP has informed the Company that it does not have
any direct financial interest in the Company and that it has not had any
direct connection with the Company in the capacity of promoter,
underwriter, director, officer or employee.
As is customary, auditors for the current fiscal year will be
appointed by the Board of Directors at their meeting immediately following
the 1998 Annual Meeting.
OTHER MATTERS
Management of the Company is not aware of other matters to be
presented for action at the 1998 Annual Meeting; however, if other matters
are presented for action, it is the intention of the persons named in the
accompanying form of proxy to vote in accordance with their judgment on
such matters.
STOCKHOLDER PROPOSALS
Stockholders' proposals to be presented at the 1999 Annual Meeting of
Stockholders, for inclusion in the Company's Proxy Statement and form of
proxy relating to the meeting, must be received by the Company at its
offices in Cudahy, Wisconsin, addressed to the Secretary of the Company,
not later than February 28, 1999. Upon timely receipt of any such
proposal, the Company will determine whether or not to include such
proposal in the proxy statement and proxy in accordance with applicable
regulations and provisions governing the solicitation of proxies. If the
Company has not received notice of a shareholder proposal at least 45 days
prior to the 1999 Annual Meeting of Stockholders, the persons named in the
proxies solicited by the Board of Directors for such meeting may exercise
discretionary voting power with respect to such proposal as provided by
Rule 14a-4 under the Securities Exchange Act of 1934, as amended.
Under the Bylaws of the Company, stockholders entitled to vote in the
election of directors may nominate one or more persons for election as
directors. The Company may require any proposed nominee to furnish such
other information as may reasonably be required by the Company to
determine the eligibility of such proposed nominee to serve as directors.
REPORT ON FORM 10-K
Due to the effective date, March 9, 1998, of the Company's
Registration Statement for the Initial Public Offering of Company Common
Stock (the "IPO"), the Company did not prepare or file a Form 10-K for the
fiscal year ended December 31, 1997.
It is important that proxies be returned promptly to avoid
unnecessary expense. Therefore, stockholders are urged, regardless of the
number of shares owned, to date, sign and return the enclosed proxy.
By Order of the Board of Directors
Wayne E. Larsen
Secretary
July 17, 1998
<PAGE>
Ladish Co., Inc.
5481 South Packard Avenue
Cudahy, Wisconsin 53110
PROXY
ANNUAL MEETING OF THE STOCKHOLDERS OF LADISH CO., INC.
TO BE HELD ON AUGUST 25, 1998
This Proxy is being solicited by the Board of Directors of Ladish
Co., Inc. (the "Company"). The undersigned hereby appoints Wayne E.
Larsen and Kerry L. Woody with full power to act alone and with full power
of substitution, as proxy of the undersigned, to attend the Annual Meeting
of the Company, to be held on Tuesday, August 25, 1998, in the Creole
Meeting Room of the Grand Milwaukee Hotel, 4747 South Howell Avenue,
Milwaukee, Wisconsin, at 10:00 a.m., Central Daylight Time, and any
adjournment or postponement thereof (the "Annual Meeting"), and to vote
all shares of Common Stock of the Company held of record by the
undersigned on July 15, 1998, upon any and all matters that may properly
come before the Annual Meeting. This Proxy, when properly executed, will
be voted in the manner directed herein by the undersigned stockholder. If
no direction is given, this Proxy will be voted FOR the proposal listed
below. This Proxy, when properly executed, may be voted in the discretion
of the proxy upon any and all other matters that may properly come before
the Annual Meeting and the proxy is hereby authorized to vote the shares
of Common Stock represented by the proxy on matters incident to the
conduct of the Annual Meeting, including any motion to adjourn or postpone
the Annual Meeting (although the proxy does not intend, and is not aware
at this time of any intention of any other person, to make such a motion).
This Proxy may be revoked at any time before the authority hereby
granted is exercised by (i) delivering a written statement of revocation
to the Secretary of the Company, (ii) submitting a later dated Proxy or
(iii) attending the Annual Meeting and voting in person.
PROPOSAL (1): To elect five (5) Directors, to serve for the term of
one year or until their successors have been elected and have duly
qualified.
Lawrence W. Bianchi [_] FOR [_] WITHHOLD
Charles W. Finkl [_] FOR [_] WITHHOLD
Wayne E. Larsen [_] FOR [_] WITHHOLD
Robert W. Sullivan [_] FOR [_] WITHHOLD
Kerry L. Woody [_] FOR [_] WITHHOLD
Dated , 1998
Signature
Signature, if held jointly
NOTE: Please sign exactly as name appears. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, broker or guardian please give full title as such. If a
corporation, please have the corporate name signed in full by the
president or other authorized officer. If a partnership, please have the
partnership name signed by an authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY.
