THE GENLYTE GROUP INCORPORATED
2345 VAUXHALL ROAD
P. O. BOX 3148
UNION, NJ 07083-1948
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ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 24, 1997
MARCH 20, 1997
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PROXY STATEMENT
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INTRODUCTION
The Annual Meeting of Stockholders (the "Annual Meeting") of The Genlyte
Group Incorporated ("Genlyte") will be held on April 24, 1997 at the offices of
Arthur Andersen LLP, 1345 Avenue of the Americas, Third Floor, New York, NY
10105 at 10:00 AM, local time, for the purposes set forth in the accompanying
notice. This proxy statement and the accompanying form of proxy are being
furnished in connection with the solicitation by Genlyte's Board of Directors of
proxies to be voted at such meeting and at any and all adjournments or
postponements thereof.
This proxy statement and accompanying form of proxy are first being sent
to stockholders on or about March 20, 1997.
ACTION TO BE TAKEN UNDER THE PROXY
All proxies properly executed, duly returned and not revoked will be voted
at the Annual Meeting (including any adjournments or postponements thereof) in
accordance with the specifications therein, or, if no specifications are made,
will be voted FOR the nominees to the Board of Directors named in this proxy
statement and listed in the accompanying form of proxy.
If a proxy in the accompanying form is executed and returned, it may
nevertheless be revoked at any time prior to the exercise thereof by executing
and returning a proxy bearing a later date, by giving notice of revocation to
the Secretary of Genlyte, or by attending the Annual Meeting and voting in
person.
ELECTION OF DIRECTORS
The Board of Directors of Genlyte currently consists of Avrum I. Drazin
(Chairman), Glenn W. Bailey, Robert B. Cadwallader, David M. Engelman, Fred
Heller, Frank Metzger and Larry K. Powers. Each of the directors elected at the
Annual Meeting will hold office for a term ending at the Annual Meeting of
Stockholders to be held in April of 2000 and until his successor has been duly
elected and qualified. Messrs. David M. Engelman, Fred Heller, and Dr. Frank
Metzger have been nominated to the Board of Directors for reelection at the
Annual Meeting.
If, for any reason, Messrs. Engelman, Heller or Dr. Metzger are not
candidates when the election occurs, which is not anticipated, it is intended
that the proxies will be voted for the election of a substitute nominee
designated by the Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES
AS DIRECTORS.
<PAGE>
Information about the nominees for election as directors and incumbent
directors, including biographical and employment information, is set forth
below.
NOMINEES FOR ELECTION AS DIRECTORS
David M. Engelman (64)........... Mr. Engelman was elected a Director of
Genlyte at the December 1993 meeting of the
Board of Directors. This appointment took
effect on January 1, 1994. Mr. Engelman was
employed by General Electric Company from
1954 through 1993 and held a variety of
general management positions. He was elected
as a Vice President of General Electric in
1982 and was in charge of international
electrical distribution and control
operations. Mr. Engelman is a member of the
Board of Directors of The Mayer Electric
Supply Company, Incorporated. He is a member
of the Compensation Committee of the Genlyte
Board of Directors.
Fred Heller (72)................. Mr. Heller was Chairman of the Board of
Genlyte from July 1989 until December 1993,
when he resigned as Chairman but retained
his position as a Director of Genlyte and
holds the honorary title of Chairman
Emeritus. He served as President of Genlyte
from its incorporation in January 1985 until
July 1989 and served as acting President of
Genlyte from January 1991 to August 1991.
From August 1981 to September 1985, Mr.
Heller was President and Chief Executive
Officer of Lightolier Incorporated. Mr.
Heller is a member of the Board of Directors
of Concord Fabrics, Inc. He is Chairman of
the Audit Committee of the Genlyte Board of
Directors.
Frank Metzger (68)............... Dr. Metzger was elected a Director of
Genlyte at the January 1985 meeting of the
Genlyte Board of Directors. Dr. Metzger has
been President of Metzger & Company,
management consultants, since June 1988. He
served as Senior Vice
President-Administration for Bairnco
Corporation ("Bairnco") from July 1986 until
his retirement from Bairnco in May 1988 and
Vice President-Administration for Bairnco
from its organization in 1981 until June
1986. Bairnco was Genlyte's corporate parent
until Genlyte was spun off to Bairnco's
shareholders in 1988. He is Chairman of the
Compensation Committee of the Genlyte Board
of Directors.
Incumbent Directors
Glenn W. Bailey (71)............. Mr. Bailey was Chairman of the Board of
Genlyte from its incorporation in January
1985 until July 1989, when he resigned as
Chairman but retained his position as a
Director of Genlyte. He was Chairman and
President of Bairnco from its incorporation
in January 1981 until May 1990. Mr. Bailey
is a member of the Nominating Committee of
the Genlyte Board of Directors.
Robert B. Cadwallader (67)....... Mr. Cadwallader was elected a Director of
Genlyte at the January 1985 meeting of the
Genlyte Board of Directors. Mr. Cadwallader
is currently President of Cadwallader
Company, Inc., a furniture industry
consulting firm and President of Cadwallader
Fabrics Inc., a textile industry consulting
and agency concern. Mr. Cadwallader was
President of Cadwallader and Sangiorgio
Associates, a manufacturer of office
furniture, from October 1986 until September
1989. From November 1983 to March 1985, he
served as Vice Chairman of SunarHauserman,
Inc., a manufacturer of movable partitions,
fabrics and systems. During the same period
he served as Director of Hauserman, Inc.,
the parent corporation of SunarHauserman,
Inc. Mr. Cadwallader is a member of the
Audit Committee of the Genlyte Board of
Directors.
Avrum I. Drazin (68)............. Mr. Drazin was elected Chairman of the Board
of Genlyte in January 1994 and has served as
a Director of Genlyte since January 1991.
Mr. Drazin
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<PAGE>
served as President of Genlyte from February
1992 until December 1993 and has served as
President of Canlyte, Inc. ("Canlyte"), a
wholly owned subsidiary of Genlyte, since
its incorporation in July 1984. He served as
President of Lightolier Canada from January
1965 until June 1984. Mr. Drazin is Chairman
of the Nominating Committee and is a member
of the Compensation Committee of the Genlyte
Board of Directors.
Larry K. Powers (54)............. Mr. Powers was appointed President and Chief
Executive Officer of Genlyte in January 1994
and has served as a Director since July
1993. He has held a variety of sales,
marketing and general management positions
in the lighting industry. From September
1979 until April 1989, Mr. Powers was
President of Hadco/Craftlite.
Hadco/Craftlite was acquired by a
predecessor of Genlyte in July 1983. Mr.
Powers then served as President of the
HID/Outdoor Division of Genlyte from May
1989 until June 1993. From July 1993 to
December 1993, he served as President of
Genlyte U.S. Operations and Executive Vice
President of Genlyte.
BOARD AND COMMITTEE MEETINGS
During 1996, Genlyte's Board of Directors met eight times for regular
meetings and one time for a special telephonic meeting. In addition, the
directors receive and review monthly reports of Genlyte's financial performance
and management confers frequently with its directors on an informal basis to
discuss company affairs. During 1996, each of the directors attended at least 75
percent of the meetings of the Board and the Board Committees of which such
director was a member.
The Board has established standing Audit, Compensation and Nominating
Committees. The Board has established the Audit Committee to recommend the firm
to be appointed as independent accountants to audit Genlyte's financial
statements and to perform services related to the audit, review the scope and
results of the audit with the independent accountants, and consider the adequacy
of the internal accounting and control procedures of Genlyte. Members of this
committee are Messrs. Cadwallader and Heller, with Mr. Heller serving as
Chairman. During 1996, the Audit Committee met one time.
The Compensation Committee reviews and recommends the compensation
arrangements for all executive officers, approves such arrangements for other
senior level employees, and administers and takes such other action as may be
required in connection with certain compensation plans of Genlyte and its
operating subsidiaries. Members of the Compensation Committee are Messrs. Drazin
and Engelman and Dr. Metzger, with Dr. Metzger serving as Chairman. During 1996,
the Compensation Committee met three times.
The Nominating Committee reviews and recommends to the Board of Directors
the appropriate size and composition of the Board of Directors as well as the
Boards of Directors of Genlyte's various subsidiaries. The Nominating Committee
will not consider recommendations from Genlyte's stockholders because the
Committee believes it has sufficient resources and contacts to fulfill its
obligations without considering such stockholder recommendations. Members of the
Nominating Committee are Messrs. Bailey and Drazin, with Mr. Drazin serving as
Chairman. During 1996, the Nominating Committee met two times.
COMPENSATION OF DIRECTORS
During 1996, each director, other than any director employed by Genlyte,
which for purposes of this section does not include employees of its
subsidiaries, received a retainer of $8,000 and $2,000 for each Board meeting
attended and each committee meeting attended on a day on which the Board of
Directors did not meet. The Chairman of the Board received a retainer of $12,000
and $3,000 for each Board meeting attended and each committee meeting attended
on a day on which the Board of Directors did not meet. Directors employed by
Genlyte are not paid any fees or additional compensation for services rendered
as members of the Board or any of its committees. Directors, excluding employees
of Canlyte, Genlyte's wholly-owned subsidiary, who also serve on the Board of
Directors of Canlyte are compensated for attendance at such meetings at the rate
of $2,000 (Canadian) per Board meeting or for committee meetings held on days
other than regular Board meeting days.
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As noted above, Messrs. Avrum I. Drazin, David M. Engelman and Dr. Frank
Metzger served as members of the Board's Compensation Committee during 1996. Mr.
Drazin is Chairman of Genlyte, was formerly President of Genlyte and is
President of Canlyte, Inc., one of the Company's subsidiaries. Directors Heller
and Powers also serve on the Canlyte, Inc. Board of Directors. Dr. Metzger
periodically provides consulting services to Lightolier, a division of Genlyte.
During 1996, Dr. Metzger earned $5,730 for consulting services provided to
Lightolier.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
NUMBER OF SHARES OUTSTANDING AND RECORD DATE
Only holders of record of Genlyte Common Stock, par value $.01 per share
("Genlyte Common Stock"), at the close of business on March 3, 1997 are entitled
to notice of, and to vote at, the Annual Meeting. Holders of Genlyte Common
Stock are entitled to one vote for each share held on the matters properly
presented at the Annual Meeting.
On March 3, 1997, there were 13,134,074 shares of Genlyte Common Stock
issued and outstanding. The holders of a majority of the shares entitled to
vote, present in person or represented by proxy, will constitute a quorum for
the transaction of business at the Annual Meeting. A plurality of the votes
present in person or represented by proxy at the Annual Meeting is required to
elect directors.
Abstentions and broker non-votes are counted for purposes of determining
the presence or absence of a quorum for the transaction of business. Abstentions
are counted in tabulations of the votes cast on proposals presented to
stockholders, whereas broker non-votes are not counted for purposes of
determining whether a proposal has been approved. Under applicable Delaware law,
a broker non-vote will have no effect on the outcome of the matters to be acted
upon at the Annual Meeting, and an abstention will have the effect of a vote
against any proposal requiring an affirmative vote of a majority of the shares
present and entitled to vote thereon.
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding the beneficial
ownership of Genlyte Common Stock by the only persons (other than Glenn W.
Bailey as discussed below) known to Genlyte to be the beneficial owners of more
than 5% of the issued and outstanding Genlyte Common Stock as of March 3, 1997:
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL
NAME AND ADDRESS OWNERSHIP OF PERCENT
OF BENEFICIAL OWNER COMMON STOCK OF CLASS
----------------- -------------- -------
<S> <C> <C>
FMR Corp. ......................................................... 1,345,000 (l) 10.2%
82 Devonshire Street
Boston, Massachusetts 02109-3614
Marvin C. Schwartz................................................. 1,200,890 (2) 9.1%
c/o Neuberger & Berman
605 Third Avenue
New York, NY 10158-3698
</TABLE>
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(1) According to the Schedule 13G furnished to Genlyte by FMR Corp., FMR Corp.
is a holding company and has sole power to vote and to dispose of such
shares through its control of its wholly-owned subsidiary, Fidelity
Management Research Company, the beneficial owner of such shares. The
Schedule 13G also reports that Edward C. Johnson 3rd, Chairman of FMR
Corp., and FMR Corp. each has sole power to dispose of the balance of the
1,345,000 shares reported through FMR's acting as investment advisor to
certain other funds, including Fidelity Capital Builder Fund, the owner of
925,000 of such shares. The power to vote the shares held by such funds
resides with the funds' Boards of Trustees.
(2) According to the Schedule 13D furnished to Genlyte by Marvin C. Schwartz,
he held sole power to vote and to dispose of 337,400 of such shares
through his personal account in which he holds 252,400 of such shares and
through his management of an individual account for the benefit of a
partner of Neuberger & Berman with respect to 85,000 of such shares. The
Schedule 13D also reports 238,990 shares owned by the Neuberger & Berman
Profit Sharing Trust (the "Plan") of which Marvin C. Schwartz is
co-trustee. The power to vote and dispose of the shares held by such funds
is shared with the Plan's trustees. In addition, 624,500 shares are held
in several accounts for the benefit of Mr. Schwartz's family. Mr. Schwartz
is the beneficial owner of such shares based on his discretionary and
shared dispositive power over such accounts.
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The following table presents information regarding beneficial ownership of
Genlyte Common Stock by each member of the Board of Directors, the Named
Officers (defined infra), and all directors and executive officers as a group as
of March 3, 1997.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP OF PERCENT
NAME GENLYTE COMMON STOCK OF CLASS
----- --------------------- -------
<S> <C> <C>
Glenn W. Bailey
14 Bassett Creek Trail N., Hobe Sound, FL 33455................ 1,425,000 (1) 10.8%
Neil M. Bardach.................................................... 11,472 (2) *
Robert B. Cadwallader.............................................. 300 *
Avrum I. Drazin.................................................... 180,774 (3) 1.4%
Zia Eftekhar....................................................... 25,897 (4) *
David M. Engelman.................................................. 17,500 (5) *
Fred Heller........................................................ 144,000 (6) 1.1%
Frank Metzger...................................................... 135,750 (7) 1.0%
Dennis Musselman................................................... 5,465 (8) *
Larry K. Powers.................................................... 76,031 (9) *
All directors and executive officers as a group
(11 persons including those named)............................. 2,057,008 (10) 15.7%
</TABLE>
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* The percentage of shares owned by such director or named officer does not
exceed 1% of the issued and outstanding Genlyte Common Stock.
(1) Includes 210,000 shares of Genlyte Common Stock owned by Mr. Bailey's
spouse as to which Mr. Bailey disclaims beneficial ownership.
(2) Includes 10,000 shares of Genlyte Common Stock which may be acquired upon
the exercise of options which are presently exercisable.
(3) Includes 1,000 shares of Genlyte Common Stock owned by Mr. Drazin's spouse
as to which Mr. Drazin disclaims beneficial ownership and 40,000 shares of
Genlyte Common Stock which may be acquired upon the exercise of options
which are presently exercisable.
(4) Includes 3,000 shares of Genlyte Common Stock which may be acquired upon
the exercise of options which are presently exercisable.
(5) Includes 7,500 shares of Genlyte Common Stock owned by Mr. Engelman's
spouse as to which Mr. Engelman disclaims beneficial ownership and 5,000
shares of Genlyte Common Stock which may be acquired upon the exercise of
options which are presently exercisable.
(6) Includes 90,266 shares of Genlyte Common Stock owned by Mr. Heller's
spouse as to which Mr. Heller disclaims beneficial ownership and 10,000
shares of Genlyte Common Stock which may be acquired upon the exercise of
options which are presently exercisable.
(7) Includes 28,000 shares of Genlyte Common Stock owned by Dr. Metzger's
spouse as to which Dr. Metzger disclaims beneficial ownership.
(8) Includes 5,000 shares of Genlyte Common Stock which may be acquired upon
the exercise of options which are presently exercisable.
(9) Includes 26,500 shares of Genlyte Common Stock which may be acquired upon
the exercise of options which are presently exercisable.
(10) Includes an aggregate of 341,766 shares of Genlyte Common Stock owned by
the spouses of certain of Genlyte's executive officers and directors as to
which each such executive officer or director disclaims beneficial
ownership and 111,700 shares of Genlyte Common Stock which may be acquired
upon the exercise of options which are presently exercisable.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors was comprised during
fiscal 1996 of Messrs. Avrum I. Drazin, David M. Engelman and Dr. Frank Metzger,
with Dr. Metzger serving as Chairman. All Committee members except Mr. Drazin
are outside directors. The Committee reviews and recommends the compensation
arrangements for all executive officers, approves such arrangements for other
senior level employees, and administers and takes such other actions as may be
required in connection with certain compensation plans of Genlyte and its
operating subsidiaries. The Board of Directors reviews and approves
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recommendations made by the Compensation Committee relating to the compensation
of Genlyte's executive officers.
The Compensation Committee has prepared the following report with respect
to executive compensation at Genlyte.
COMPENSATION PHILOSOPHY
Genlyte's compensation philosophy is to provide competitive pay for
competitive performance and superior pay for superior performance. Genlyte seeks
to ensure that its executive compensation programs and policies relate to and
support its overall objective to enhance stockholder value through the
profitable management of its operations. To achieve this goal, the following
objectives serve as guidelines for compensation decisions:
o Provide a competitive total compensation framework that enables
Genlyte to attract, retain and motivate key executives who will
contribute to Genlyte's success;
o Ensure that compensation programs are linked to performance on both
an individual and operating unit level; and
o Align the interests of employees with the interests of stockholders
by encouraging employee stock ownership.
COMPONENTS OF COMPENSATION
Genlyte's compensation strategy incorporates a combination of cash and
equity-based compensation as follows:
o A performance management system that relates individual base salary
changes to a formal process in which individual performance is
reviewed, discussed and evaluated.
o Short-term incentive programs that provide executives with the
opportunity to add substantial variable compensation to their annual
base salaries through attainment of specific, measurable goals
intended to encourage high levels of organizational performance and
superior achievement of individual objectives.
o Long-term incentive opportunities in the form of stock options in
which rewards are linked directly to stockholder gains. For fiscal
year 1996, Genlyte's compensation programs consisted of:
BASE SALARY
Salary pay levels at Genlyte are competitive with the marketplace. The
Compensation Committee uses commercially published surveys prepared by
established compensation consulting firms to assure that base compensation
levels are positioned relative to the range that is generally paid to executives
having similar levels of experience and responsibility at companies of
comparable size and complexity. Data is drawn from the electric lighting
equipment and supply industry as well as general industry survey data.
Consideration is also given to other factors such as individual performance and
potential.
SHORT-TERM INCENTIVES
Executives and key employees of Genlyte participate in a short-term
incentive program which rewards the achievement of profit and profit-related
objectives. These employees are afforded an opportunity to earn substantial
variable compensation each year through participation in the Management
Incentive Compensation (MIC) Program. This program combines elements of profit
sharing, in which total management performance is rewarded only to the extent
also realized by stockholders as measured in Earnings Per Share (EPS), Earnings
Before Interest and Taxes (EBIT), and Return on Capital Employed (ROCE), and in
terms of individual performance, as measured by achievement of specific,
measurable goals established by participants and approved by management.
Funding for MIC awards is formula-driven based on achievement of financial
goals for each operating unit. The Board of Directors reviews and approves
profit and profit-related objectives at the beginning of
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each year. By policy, the level of funding which results from the MIC formulas
cannot be modified and the total payout of awards for all MIC participants is
limited to 15 percent of Genlyte's profit before taxes each year. In order to
maximize results, objectives are typically established at a level of performance
above normal expectations. Consideration is also given to past financial
performance as a means to ensure that consistent and sustained business results
are achieved.
Actual individual MIC awards are dependent upon three factors: (1) the
requirement that stated objectives be met by both individual participants and
their operating units; (2) the relative success and extent to which those
objectives are achieved; and (3) the participant's relative level within the
organization as determined annually according to policy guidelines.
In 1996, the Compensation Committee and the Board of Directors reviewed
and approved the renewal of the MIC Program, related policies, and all
recommended MIC awards.
LONG-TERM INCENTIVES
Genlyte believes that the interests of stockholders and executives become
more closely aligned when such executives are provided an opportunity to acquire
a proprietary interest through ownership of its Common Stock. Through the 1988
Genlyte Stock Option Plan, officers and key employees are granted options to
purchase Genlyte Stock and maintain significant share ownership within the
parameters of the program. Most grants are exercisable in installments
commencing two years after the date of grant. The exercise price of options is
set, and has at all times in the past been set, at fair market value or book
value, whichever is higher.
In December 1992, a "performance-vested" stock option approach was
developed with respect to particular options granted to certain executives. Such
options were designed to provide added compensation for superior performance and
are exercisable upon achievement of specified EPS goals as approved by the
Compensation Committee and the Board of Directors.
BENEFITS
Genlyte's executive officers participate in the same pension, health and
benefit programs that are generally available to other employees who are not the
subject of collective bargaining agreements. There are no special executive
officer plans with the exception of a now inactive Supplemental Employee
Retirement Plan in which two long-term executive officers still participate.
CHIEF EXECUTIVE OFFICER COMPENSATION
Mr. Powers served as Chief Executive Officer in 1996 at a salary of
$310,000 per annum. Mr. Powers received $232,400 in incentive compensation for
1996 recognizing a significant improvement in the EPS over prior year, as well
as the level of achievement of Mr. Powers' personal objectives. In 1996 the
Compensation Committee recommended and the Board of Directors approved stock
option grants for Mr. Powers of 52,500 shares in recognition of its assessment
of his ability and dedication to enhance the long-term value of Genlyte for the
stockholders. These grants are consistent with the overall design of the option
program.
CONCLUSION
In summary, the Compensation Committee continued its policy in fiscal year
1996 of linking executive compensation to Genlyte performance. The outcome of
this process is that stockholders receive a fair return on their investment
while executives are rewarded in an appropriate manner for meeting or exceeding
performance objectives. The Committee believes that Genlyte's compensation
levels adequately reflect its philosophy of providing competitive pay for
competitive performance and superior pay for superior performance. Likewise, the
Committee believes that Genlyte's executive compensation programs and policies
are supportive of its overall objective to enhance stockholder value through the
profitable management of its operations.
Frank Metzger, Chairman
Avrum I. Drazin
David M. Engelman
7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information concerning annual, long-term and
other compensation for services in Genlyte of those persons who were, on
December 31, 1996, Genlyte's (i) chief executive officer and (ii) other four
most highly compensated executive officers (together, the "Named Officers"):
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
---------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUT
--------------------------------- ------------------- -----------------
OTHER STOCK LONG- ALL
NAME AND ANNUAL RESTRICTED OPTIONS/ TERM OTHER
PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) COMP ($) AWARDS ($) SARS (#) PAYOUT($) COMP ($)
- --------------- ---- -------- -------- ------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Larry K. Powers 1996 309,423 232,400 4,380 (1,2) 0 52,500 0 0
President & 1995 280,000 161,850 4,398 (1,2) 0 35,000 0 0
CEO 1994 278,942 73,900 (3) 1,478 (1,2) 0 0 0 0
Neil M. Bardach 1996 174,423 103,488 0 0 5,000 0 0
Vice President, 1995 165,000 78,624 0 0 10,000 0 0
CFO & Treasurer 1994 79,327 25,000 0 0 20,000 0 0
Avrum I. Drazin
Pres, Canlyte; 1996 230,733(2) 17,498 36,000 (4) 0 5,000 0 11,823 (2,5)
Chairman of the 1995 226,008(2) 10,951 36,000 (4) 0 10,000 0 10,851 (2,5)
Board/Genlyte 1994 221,805(2) 3,645 (3) 36,000 (4) 0 0 0 9,776 (2,5)
Zia Eftekhar 1996 200,000 63,263 0 0 7,500 0 46,050 (5)
President 1995 200,000 15,208 35,780 (6) 0 10,000 0 13,425 (5)
Lightolier Div. 1994 184,519 191,646 (3) 0 0 0 0 14,703 (5)
Dennis Musselman
VP & General 1996 135,000 141,308 0 0 5,000 0 0
Manager Hadco 1995 129,615 105,950 0 0 7,000 0 0
Div. 1994 125,000 83,280 (3) 0 0 7,200 0 0
</TABLE>
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(1) Director's fees for Canlyte, Inc., Genlyte's wholly owned subsidiary.
(2) These figures were converted from Canadian dollars to U.S. dollars using
the exchange rate as of the last day of the fiscal year for that period.
(3) Includes payment made in 1997 of a portion of 1994 bonus earned contingent
on subsequent earnings.
(4) Director's retainer and fees in U.S. dollars.
(5) Represents service and interest expense accrual for Supplemental Employee
Retirement Plan benefit.
(6) Represents expenses for relocation and related fees.
OPTION GRANTS
Shown below is further information on grants of stock options pursuant to
the 1988 Stock Option Plan during the fiscal year ended December 31, 1996 to the
Named Officers reflected in the Summary Compensation Table. No stock
appreciation rights were granted under that Plan during fiscal 1996.
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OPTION GRANTS IN FISCAL 1996
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE OF ASSUMED
% OF ANNUAL RATES OF STOCK
TOTAL OPTIONS PRICE APPRECIATION
GRANTED TO EXERCISE OR FOR OPTION TERM (2)
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION ----------------------
NAME GRANTED (#)(1) FISCAL YEAR ($/SHARE) DATE 5% ($) 10%($)
----- ------------- ---------- -------- ----- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Larry K. Powers.......... 35,000 16.5% $ 7.50 08/22/2001 $72,524 $160,259
17,500 8.3% $10.25 12/18/2001 $49,558 $109,510
Neil M. Bardach.......... 5,000 2.4% $ 7.50 08/22/2001 $10,361 $ 22,894
Avrum I. Drazin.......... 5,000 2.4% $ 7.50 08/22/2001 $10,361 $ 22,894
Zia Eftekhar............. 7,500 3.5% $ 7.50 08/22/2001 $15,541 $ 34,341
Dennis Musselman......... 5,000 2.4% $ 7.50 08/22/2001 $10,361 $ 22,894
</TABLE>
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(1) These options were granted to the Named Officer five years prior to the
indicated expiration date and are exercisable at the rate of 50% per year
commencing two years after the date of grant. In the event of certain
mergers, consolidations or reorganizations of Genlyte or any disposition
of substantially all the assets of Genlyte or any liquidation or
dissolution of Genlyte, then in most cases all outstanding options not
exercisable in full shall be accelerated and become exercisable in full
for a period of 30 days. In addition, in the event of certain changes in
control of Genlyte or of its Board of Directors, then any outstanding
option not exercisable in full shall in most cases be accelerated and
become exercisable in full for the remaining term of the option.
(2) Realizable value is shown net of option exercise price, but before taxes
associated with exercise. These amounts represent assumed compounded rates
of appreciation and exercise of the options immediately prior to the
expiration of their term. Actual gains, if any, are dependent on the
future performance of the Common Stock, overall stock market conditions,
and the optionee's continued employment through the exercise period. The
amounts reflected in this table may not necessarily be achieved.
OPTION EXERCISES AND FISCAL YEAR-END VALUES
Shown below is information with respect to the exercised/unexercised
options to purchase Genlyte's Common Stock granted in fiscal 1996 and prior
years under Genlyte's 1988 Stock Option Plan to the Named Officers and held by
them on December 31, 1996.
OPTION EXERCISES AND YEAR-END VALUE TABLE
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1996
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
SHARES UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
ACQUIRED AT FY-END (#) AT FY-END ($) (1)
ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE REALIZED ($) UNEXERCISABLE UNEXERCISABLE
----- ----------- ------------ ---------------- -------------------
<S> <C> <C> <C> <C>
Larry K. Powers 22,500 60,525 26,500/103,500 $206,983/$498,334
Neil M. Bardach 0 0 10,000/ 25,000 $77,500/$151,250
Avrum I. Drazin . 10,000 47,200 40,000/ 55,000 $260,000/$392,550
Zia Eftekhar 23,000 71,185 3,000/ 41,500 $20,536/$264,032
Dennis Musselman . 0 0 5,000/ 19,200 $39,700/$105,478
</TABLE>
- ----------
(1) Based upon the 12/31/96 closing price of $12.50 for Genlyte stock on the
NASDAQ National Market System. Realizable value is shown net of option
exercise price, but before taxes associated with exercise.
9
<PAGE>
RETIREMENT PLAN
The majority of Genlyte's employees who are employed in the United States
and who are not represented by a collective bargaining unit become participants
in a qualified noncontributory defined benefit pension plan (the "Plan") on the
January 1st following their date of hire. Each of the Named Officers was a
participant in the Plan during fiscal year 1996 except Mr. Drazin, who is a
participant in a Canadian Pension Plan.
The following table presents information regarding estimated annual
benefits payable upon normal retirement at age 65 in the form of a single life
annuity to persons in specified remuneration and years of service
classifications:
<TABLE>
<CAPTION>
FOR EMPLOYEES RETIRING AT AGE 65 IN 1997(1)
AVERAGE COMPENSATION YEARS OF SERVICE AT RETIREMENT (2)
AT RETIREMENT 5 10 15 20 25 OR MORE
-------------------- ------- -------- -------- -------- ---------
<C> <C> <C> <C> <C> <C>
$50,000 $ 3,517 $ 7,035 $10,552 $14,070 $17,587
$100,000 7,767 15,535 23,302 31,070 38,837
$152,000(3) 12,187 24,375 36,562 48,750 60,937
Greater than $152,000(3) 12,187 24,375 36,562 48,750 60,937
</TABLE>
- ----------
(1) For employees retiring at ages under 65, the estimated annual benefits
would be lower.
(2) The amounts are based on the formula which became effective January 1,
1995.
(3) In accordance with provisions of the Omnibus Budget Reconciliation Act of
1993, effective January 1, 1994, the maximum allowable compensation
permitted in computing a benefit was $150,000, subject to annual cost of
living increases. For 1997, the maximum allowable compensation as provided
under IRS 401(a)(17) is $160,000. Therefore, the highest possible final
average compensation for a participant retiring in 1997 is $152,000.
However, any accrued benefit as of December 31, 1994 which is based on
compensation in excess of $150,000 for years prior to 1994 will be
protected.
Remuneration covered by the Plan in a particular year includes (1) that
year's salary (base pay, overtime and commissions), and (2) compensation
received in that year under the Management Incentive Compensation Plan. The 1996
remuneration covered by the Retirement Plan includes, for the recipients
thereof, Management Incentive Compensation paid during 1996 with respect to 1995
awards.
For each of the following Named Officers of Genlyte, the credited years of
service under the Plan, as of December 31, 1996, and the remuneration received
during 1996 covered by the Plan were, respectively, as follows:
COVERED YEARS OF
NAME COMPENSATION SERVICE
----- ------------ -------
Larry K. Powers ....................... $150,000* 17
Neil M. Bardach ....................... $150,000* 2
Zia Eftekhar .......................... $150,000* 29
Dennis Musselman ...................... $150,000* 2
- ----------
* As limited by the maximum allowable compensation provided under IRS 401
(a)(17) of $150,000 for 1996.
Pension benefits at age 65 (normal retirement age) for active participants
as of January 1, 1997 are calculated as follows: 1.2% of final five-year average
pay up to covered compensation level, plus 1.7% of final five-year average pay
over the covered compensation level, multiplied by the total years of recognized
service, to a maximum of 25 years. All such participants will receive the
greater of their benefit under the new formula or the benefit accrued under a
prior plan formula as of December 31, 1994. In addition, certain maximum benefit
limitations are incorporated in the Plan. The final five-year average pay is
determined by taking the average of the highest consecutive five-year period of
earnings within a ten-year period prior to retirement. The term "covered
compensation", as defined by the Internal Revenue Service, refers to the 35-year
average of the Social Security taxable wage bases applicable to a participant
for each year projected to Social Security normal retirement age.
10
<PAGE>
EMPLOYMENT PROTECTION AGREEMENTS
Genlyte has entered into contracts with a group of key employees, including
Messrs. Powers, Bardach, Drazin, Eftekhar and Musselman, that become effective
if the employee is employed on the date a change of control (as defined in the
agreement) occurs and that provide each such employee with a guarantee that his
duties, compensation and benefits will generally continue unaffected for two (2)
years following the change of control. In the event that an eligible employee's
employment is terminated without cause by Genlyte or if the employee is
constructively terminated within two (2) years following the change of control,
such employee will receive either ( i ) the sum of (x) two (2) times the
aggregate amount of his then current base salary, plus (y) two (2) times the
average of his last three (3) annual awards paid under Genlyte' s Management
Incentive Compensation Plan plus (z) the present value of any unvested benefits
under Genlyte's qualified plans and the annual cost of the employee's
participation in all employee benefit plans of Genlyte or (ii) if it would
result in the employee receiving a greater net-after tax amount, a lesser amount
equal to the amount that produces the greatest net-after tax amount for the
employee. (An employee will be treated as having been constructively terminated
if he quits after being removed from office or demoted, his compensation or
benefits are reduced, his duties are significantly changed, his ability to
perform his duties is substantially impaired or his place of employment is
relocated a substantial distance from his principal residence.) These agreements
will continue in effect at least until December 31, 1997 and automatically renew
for an additional year as of each January 1 after December 31, 1997, unless
Genlyte or the employee provides sixty (60) days written notice of non-renewal
prior to such January 1.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
Genlyte's directors and executive officers, and persons who own more than ten
percent of Genlyte's Common Stock, to file with the Securities and Exchange
Commission ("SEC") initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of Genlyte. Officers,
directors and greater than 10% shareholders are required by SEC regulation to
furnish Genlyte with copies of all Section 16(a) reports they file.
Based solely on its review of the copies of such forms received by it with
respect to fiscal 1996, Genlyte believes that there is compliance with all
filing requirements applicable to its directors, officers and persons who own
more than 10% of Genlyte's Common Stock.
INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of Directors has
appointed Arthur Andersen LLP as Genlyte's principal independent public
accountants for the year 1997.
A representative of Arthur Andersen LLP, the Company's auditor for 1996, is
expected to be present at the Annual Meeting and will have an opportunity to
respond to appropriate questions and make a statement if desired to do so.
1998 PROPOSALS BY HOLDERS OF GENLYTE COMMON STOCK
Any proposal which a stockholder of Genlyte desires to have included in the
proxy statement relating to the 1998 Annual Meeting of Stockholders must be
received by Genlyte at its executive offices by no later than November 20, 1997.
The executive offices of Genlyte are located at 2345 Vauxhall Road, P. O. Box
3148, Union, N. J. 07083-1948.
11
<PAGE>
COMPARATIVE STOCK PERFORMANCE
The graph below compares the cumulative total return on the Common Stock of
Genlyte with the cumulative total return on the NASDAQ Stock Market Index (U.S.
companies) and the Electric Lighting & Wiring Equipment Index (SIC Group 364)
from December 31, 1991(1). The graph assumes the investment of $100 in Genlyte
Common Stock, the NASDAQ Stock Market Index, and the Electric Lighting & Wiring
Equipment Index on December 31, 1991.
[THE FOLLOWING TABLE REFERENCES A GRAPHIC CHART]
THE GENLYTE NASDAQ STOCK ELECTRIC LIGHTING
GROUP MARKET INDEX & WIRING EQUIPMENT
INCORPORATED (U.S. COMPANIES) INDEX
------------ ---------------- ------------------
1991 $100 $100 $100
1992 $ 93.2 $112.5 $101
1993 $ 65.9 $113.5 $121
1994 $ 77.3 $116.7 $127.2
1995 $122.7 $154.2 $165
1996 $227.3 $192.3 $205
- ----------
(1) Total return calculations for the NASDAQ Stock Market Index, Electric
Lighting & Wiring Equipment Index (consisting of approximately 26
companies), and Genlyte Stock were performed by Media General Financial
Services.
12
<PAGE>
EXPENSES AND OTHER MATTERS
EXPENSES OF SOLICITATION
Genlyte will pay the costs of preparing, assembling and mailing this proxy
statement and the material enclosed herewith. Genlyte has requested brokers,
nominees, fiduciaries and other custodians who hold shares of its common stock
in their names to solicit proxies from their clients who own such shares and
Genlyte has agreed to reimburse them for their expenses in so doing.
In addition to the use of the mails, certain officers, directors and other
employees of Genlyte, at no additional compensation, may request the return of
proxies by personal interview or by telephone or telegraph.
OTHER ITEMS OF BUSINESS
The Board of Directors does not intend to present any further items of
business to the meeting and knows of no such items which will or may be
presented by others. However, if any other matter properly comes before the
meeting, the persons named in the enclosed proxy form will vote thereon in such
manner as they may in their discretion determine.
By Order of the Board of Directors,
DONNA R. RATLIFF
SECRETARY
March 20, 1997
