<PAGE> 1
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- --------------------------------------------------------------------------------
SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
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:
<TABLE>
<S> <C>
[ ] 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
</TABLE>
ROBBINS & MYERS, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXX
(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: ................................................................
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<PAGE> 2
[Robbins & Myers Logo]
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
<TABLE>
<S> <C>
Date: Wednesday, December 9, 1998
Time: 11:00 A.M., E.S.T.
Place: Kettering Tower, 12th Floor
Second and Main Streets
Dayton, Ohio 45423
At the Annual Meeting, shareholders of Robbins & Myers, Inc. will:
</TABLE>
- - ELECT THREE DIRECTORS FOR A TWO-YEAR TERM;
- - VOTE ON APPROVING THE APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS
OF THE COMPANY FOR THE FISCAL YEAR ENDING AUGUST 31, 1999; AND
- - TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY
ADJOURNMENT THEREOF.
Shareholders of record at the close of business on October 23, 1998 may vote at
the meeting.
Your vote is important. Please fill out the enclosed proxy card and return it in
the reply envelope.
By Order of the Board of Directors,
Joseph M. Rigot
Secretary
November 11, 1998
<PAGE> 3
PROXY STATEMENT FOR 1998 ANNUAL MEETING OF SHAREHOLDERS
ROBBINS & MYERS, INC. November 11, 1998
1400 KETTERING TOWER
DAYTON, OHIO 45423
SOLICITATION AND VOTING OF PROXIES
The Board of Directors of Robbins & Myers, Inc. is sending you this Proxy
Statement to solicit your proxy. If you give the Board your proxy, the proxy
agents of the Board will vote your shares at the Annual Meeting of Shareholders
on December 9, 1998 and any adjournment of the meeting. The proxy agents will
vote your shares as you specify on the proxy card. If you do not specify how
your shares should be voted, the proxy agents will vote your shares in
accordance with the Board's recommendations.
You may revoke your proxy at any time before the proxy agents use it to vote on
a matter. You may revoke your proxy in any one of three ways:
- You may send in another proxy card with a later date.
- You may notify the Company in writing before the Annual Meeting that
you have revoked your proxy.
- You may vote in person at the Annual Meeting.
The Company first mailed this Proxy Statement to shareholders on November 11,
1998.
VOTING SECURITIES AND RECORD DATE
You are entitled to notice of the Annual Meeting and to vote at the meeting if
you owned common shares of record at the close of business on October 23, 1998.
For each share owned of record, you are entitled to one vote. On October 23,
1998, the Company had 10,914,259 common shares outstanding, which are the only
outstanding voting securities.
QUORUM REQUIREMENT AND VOTING
A quorum of shareholders is necessary to hold a valid meeting. The presence, in
person or by proxy, of the holders of one-third of the common shares is
necessary to have a quorum for the election of directors. The presence, in
person or by proxy, of the holders of a majority of the outstanding shares is
necessary for any other purpose. Abstentions and broker non-votes are counted as
present for establishing a quorum. A broker non-vote occurs when a broker votes
on some matters on the proxy card but not on others because he does not have the
authority to do so.
In counting votes on a particular item, the Company will treat abstentions as
votes cast on the particular matter. The Company will not, however, treat broker
non-votes as either votes cast or shares present for matters related to the
particular item.
If a shareholder notifies the Company in writing 48 hours or more before the
meeting that the shareholder desires that directors be elected by cumulative
voting, then shareholders will have cumulative voting rights in the election of
directors. Cumulative voting allows each shareholder to multiply the number of
shares owned by the number of directors to be elected and to cast the total for
one nominee or distribute the votes among the nominees as the shareholder
desires. Nominees who receive the greatest number of votes will be elected.
<PAGE> 4
ELECTION OF DIRECTORS
The Company's Board of Directors is divided into two classes, one comprised of
three directors and the other of four directors. One class of directors is
elected at each Annual Meeting of Shareholders for a term of two years.
At the 1998 Annual Meeting, shareholders will elect three directors who will
hold office until the Annual Meeting of Shareholders in 2000. The Board has
nominated Daniel W. Duval, Thomas P. Loftis, and Jerome F. Tatar for election as
directors. All nominees are presently directors.
If a nominee becomes unable to stand for reelection, the Board's proxy agents
will vote the proxies for a substitute nominee of the Board. If shareholders
vote cumulatively in the election of directors, then the Board's proxy agents
will vote the shares represented by the proxies cumulatively for the election of
as many of the Board's nominees as possible and in such order as the proxy
agents determine.
NOMINEES FOR TERM OF OFFICE EXPIRING IN 2000
DANIEL W. DUVAL DIRECTOR SINCE 1986
Mr. Duval, 62, has been President and Chief Executive Officer of the Company
since December 1986. He was President and Chief Operating Officer of
Midland-Ross Corporation (a manufacturer of electrical, electronic and aerospace
products and thermal systems) from July 1983 to 1986. Mr. Duval is a Director of
Arrow Electronics, Inc. and National City Bank.
THOMAS P. LOFTIS DIRECTOR SINCE 1987
Mr. Loftis, 54, has been engaged in commercial real estate development, asset
management and consulting with Midland Properties, Inc. since 1981. Mr. Loftis
has been a general partner of M.H.M. & Co., Ltd. (investments) since 1986.
JEROME F. TATAR DIRECTOR SINCE 1991
Mr. Tatar, 51, became Chairman of the Board and Chief Executive Officer of The
Mead Corporation (forest products) on November 1, 1997 and has served as its
President since April 1996. From April 1996 to November 1997, he was the
President and Chief Operating Officer and a director of The Mead Corporation.
From July 1994 to April 1996, he was Vice President -- Operating Officer of The
Mead Corporation. From November 1986 to July 1994, he was President of the Mead
Fine Paper Division of The Mead Corporation.
2
<PAGE> 5
DIRECTORS CONTINUING IN OFFICE UNTIL 1999
ROBERT J. KEGERREIS, PH.D. DIRECTOR SINCE 1972
Dr. Kegerreis, 77, served as President of Wright State University from July 1973
to June 1985. He is currently a management consultant and has served as
Executive Director of the Arts Center Foundation, Dayton, Ohio, since 1989. Dr.
Kegerreis is a director of Bank One, N.A.
WILLIAM D. MANNING, JR. DIRECTOR SINCE 1995
Mr. Manning, 64, was Senior Vice President of The Lubrizol Corporation
(industrial chemicals) from 1985 to his retirement in April 1994. He is
currently a management consultant. Mr. Manning is a director of Unifrax
Corporation.
MAYNARD H. MURCH IV DIRECTOR SINCE 1977
Mr. Murch, 54, has been Chairman of the Board of the Company since July 1979. He
is President and Chief Executive Officer of Maynard H. Murch Co., Inc.
(investments) which is managing general partner of M.H.M. & Co., Ltd.
(investments). Since 1976, Mr. Murch has been Vice President of Parker/Hunter,
Incorporated (dealer in securities), a successor firm to Murch and Co., Inc., a
securities firm which Mr. Murch had been associated with since 1968. Mr. Murch
is a director of Lumitex, Inc.
JOHN N. TAYLOR, JR. DIRECTOR SINCE 1988
Mr. Taylor, 63, has been Chairman and Chief Executive Officer since August 1986,
and was President from October 1974 until August 1986, of Kurz-Kasch, Inc. (a
specialty manufacturer of plastic-based components, stators and coil products).
He was also Chairman and Chief Executive Officer of Component Technology Corp.
(a manufacturer of plastic-based assemblies) from 1982 to June 1989. Mr. Taylor
is a director of LSI Industries, Inc.
3
<PAGE> 6
DIRECTORS' MEETINGS AND COMMITTEES
The Board of Directors met five times in fiscal 1998. The Board of Directors has
two committees: the Audit Committee [Messrs. Taylor (Chairman), Kegerreis and
Manning], which met twice in fiscal 1998, and the Compensation Committee
[Messrs. Kegerreis (Chairman), Manning and Tatar], which also met twice in
fiscal 1998. Each director attended all of the meetings of the Board of
Directors and the committees on which he served in fiscal 1998, except one
director was unable to attend one Board meeting.
The Audit Committee meets with Company personnel and with representatives of
Ernst & Young LLP, the Company's independent auditors, to review internal
auditing procedures, the annual audit of the Company's financial statements, and
compliance with the Company's Code of Business Conduct. The Committee reports
its findings and recommendations to the Board of Directors.
The Compensation Committee develops and administers the Company's executive
compensation policies and programs and sets the compensation of executive
officers. The Committee also advises the Board of Directors on the creation,
administration or modification of employee compensation policies and procedures.
DIRECTOR COMPENSATION
Directors who are not employees of the Company received the following
compensation in fiscal 1998:
<TABLE>
<S> <C>
Annual Retainer: $27,000 (50% is paid in restricted
shares of the Company which vest
after one year)
Committee Chairman Stipend: $2,000
Stock Options: 2,000 share option granted to each
director on the date he is elected to
a new term; option price is equal to
fair market value on date of
election.
</TABLE>
4
<PAGE> 7
SECURITY OWNERSHIP
DIRECTORS AND EXECUTIVE OFFICERS
Set forth below is information as of October 23, 1998 concerning common shares
of the Company beneficially owned by each director, each executive officer named
in the Summary Compensation Table, and directors and executive officers as a
group.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
NUMBER OF SHARES
BENEFICIALLY OWNED PERCENT OF
INDIVIDUAL OR GROUP AS OF 10/23/98(1) CLASS
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Daniel W. Duval 363,994 3.3%
Robert J. Kegerreis 29,591 (5)
Thomas P. Loftis 37,670(2) (5)
William D. Manning, Jr. 16,699 (5)
Maynard H. Murch IV 3,088,814(3) 28.3%
Jerome F. Tatar 16,178 (5)
John N. Taylor, Jr. 129,032(4) 1.2%
Gerald L. Connelly 126,437 1.2%
Stephen R. Ley 19,937 (5)
George M. Walker 12,189 (5)
Kevin J. Brown 2,896 (5)
Directors and Executive Officers as a
Group (12 persons) 3,847,160 32.4%
- ----------------------------------------------------------------------------------------
</TABLE>
(1) Unless otherwise indicated, total voting power and total investment power
are exercised by each individual and/or a member of his household. Shares
which a person may acquire within 60 days of October 23, 1998 are treated as
"beneficially owned" and the number of such shares included in the table for
each person were:
<TABLE>
<S> <C> <C>
Mr. Duval -- 222,000 Dr. Kegerreis -- 8,367 Mr. Loftis -- 6,000
Mr. Manning -- 9,500 Mr. Murch -- 8,000 Mr. Tatar -- 10,000
Mr. Taylor -- 8,000 Mr. Connelly -- 70,000 Mr. Ley -- 9,000
Mr. Walker -- 10,834 Mr. Brown -- 2,460
Directors and executive officers as a group -- 365,078
</TABLE>
(2) Includes 11,368 shares with respect to which Mr. Loftis has sole voting and
shared investment power and 1,024 shares with respect to which he has shared
voting and investment power.
(3) Includes 32,000 shares with respect to which Mr. Murch has sole voting and
shared investment power and 2,994,254 shares beneficially owned by M.H.M. &
Co., Ltd. See Footnote (1) in the following section.
(4) Includes 20,200 shares held of record in the name of K-K Realty Co., of
which Mr. Taylor is the general partner.
(5) Less than 1%.
5
<PAGE> 8
PRINCIPAL SHAREHOLDERS
The only persons known by the Board of Directors of the Company to be beneficial
owners of more than 5% of the outstanding common shares of the Company as of
October 23, 1998 are listed in the following table:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
NUMBER OF COMMON
SHARES BENEFICIALLY
NAME AND ADDRESS OWNED AS OF 10/23/98 % OF CLASS
- --------------------------------------------------------------------------------------
<S> <C> <C>
M.H.M. & Co., Ltd.(1) 2,994,254 27.4%
830 Hanna Building
Cleveland, OH 44115
- --------------------------------------------------------------------------------------
Southeastern Asset 1,152,400 10.6%
Management, Inc.(2)
6410 Poplar Ave., Suite 900
Memphis, TN 38119
- --------------------------------------------------------------------------------------
</TABLE>
(1) M.H.M. & Co., Ltd. is an Ohio limited partnership (the "Partnership").
Maynard H. Murch Co., Inc. is the managing general partner, and Thomas P.
Loftis is the other general partner, of the Partnership. Partnership
decisions with respect to the voting and disposition of Company shares are
determined by Maynard H. Murch Co., Inc., whose board of directors is
comprised of Maynard H. Murch IV and Robert B. Murch, who are brothers, and
Creighton B. Murch, who is their first cousin.
(2) Southeastern Asset Management, Inc. is a registered investment adviser; all
of the listed shares are legally owned by Southeastern's investment advisory
clients. Southeastern has shared voting and shared dispositive power with
respect to 688,400 shares; and with respect to the remaining 464,000 shares,
it has sole dispositive power as to all 464,000 shares and sole voting power
with respect to 220,000 shares.
6
<PAGE> 9
COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Board's Compensation Committee develops and administers the Company's
compensation policies and programs. It sets the compensation of executive
officers. The Committee members are three directors who are not present or
former employees of the Company.
OBJECTIVES AND POLICIES
The Committee seeks to:
- Offer a total compensation package which compares favorably to those
of industrial companies similar to the Company;
- Tie compensation to the annual business plan and progress on
long-term goals;
- Reward both Company and individual performance;
- Attract and retain talented executives critical to the Company's
long-term success; and
- Link executive's goals with those of shareholders.
Tax Deductibility of Compensation. Because certain executives could realize more
than $1,000,000 in compensation in one year due to payout of long-term
incentives and option exercises, the Committee addressed the $1,000,000 annual
limitation on deductibility for federal income tax of compensation paid to
executives named in the "Summary Compensation Table" at page 10. In 1996,
shareholders approved the Company's annual cash bonus plan and amendments to the
1994 Long-Term Incentive Stock Plan. As a result, incentive compensation paid to
the Company's executives as cash bonuses, performance shares, and options should
normally be deductible for federal income taxes.
TYPES OF COMPENSATION
The Company pays two types of compensation:
- Annual compensation -- includes base salary and a cash bonus if
certain financial targets are achieved; and
- Long-term compensation -- includes restricted shares which are only
granted to executives if a specified three-year goal is met and
annual stock option grants which are only valuable if the Company's
stock price increases.
ANNUAL COMPENSATION
Base Salary. The Company pays executives a salary each year which it believes is
competitive with salaries paid by other industrial companies similar to the
Company based on survey data of independent compensation consultants. The
Committee reviews this salary survey data and periodically adjusts the Company's
salary structure. The structure is adjusted, when necessary, to maintain salary
ranges slightly above the survey median. Individual salaries, which are
considered annually, may be adjusted to reflect changes in the Company's salary
structure,
7
<PAGE> 10
attainment of individual objectives during the preceding year, and overall
Company performance.
Annual Cash Bonus Opportunity. Executives can earn a cash bonus each year. For
fiscal 1998, the bonuses were calculated as follows:
- Available bonuses at targeted performance levels ranged from 30% to
50% of salary; executives with higher positions on the Hay Position
Evaluation System are eligible for a larger bonus percentage,
effectively making more of their total compensation dependent on
performance.
- Performance measures and the respective weighting assigned to each
were:
-- Consolidated sales growth (40%)
-- Income before interest and taxes (40%)
-- Controllable asset management (20%)
- Bonuses were paid at approximately 57% of targeted performance
percentages based on actual performance measure achievements for
fiscal 1998.
LONG-TERM COMPENSATION INCENTIVES
The Company's executives make strategic business decisions daily which are
ultimately successful only if they increase shareholder value. The Committee
believes a significant portion of executive compensation should be tied to
increases in shareholder value and paid in Company stock. To accomplish this,
the Committee uses stock options and restricted shares as long-term incentives.
Stock Options. The Committee annually grants stock options to executives under
the Company's 1994 Long-Term Incentive Stock Plan. The option price is the fair
market value of a Company share on the date of grant. Options generally become
exercisable over a three-year period and expire 10 years after grant. The
Committee determines the number of shares, if any, to be granted to each
executive based on:
- executive's ability to impact the Company's long-term financial
results;
- executive's recent performance; and
- importance of executive to achieving the Company's long-term goals.
Performance Shares. At the beginning of fiscal 1997, the Committee awarded
performance shares to executives. The number of performance shares, which
convert to restricted shares earned are directly related to the total
shareholder return for the Company over the three-year period ending August 31,
1999 compared to the total shareholder return for companies in the Russell 2000
Company Group Index ("Index") for the same period. No restricted shares are
earned unless the total shareholder return for the Company for the three-year
period is at least equal to the median return for companies in the Index. The
earned restricted shares vest over two years if the executive continues in the
employment of the Company. Thus, it takes five years to reach pay-out under the
performance/restricted share plan. Pay-out may occur earlier in individual
cases, for example, if the executive retires.
8
<PAGE> 11
COMPENSATION OF CHIEF EXECUTIVE OFFICER
In determining Mr. Duval's total compensation, the Committee considers the
Company's financial results, his strong personal leadership in developing and
executing the Company's strategic plan, and his key role in the Company's
acquisition program.
The Committee increased Mr. Duval's salary from $400,000 to $420,000 in October
1997. As a participant in the annual cash bonus plan, Mr. Duval's cash bonus for
fiscal 1998 was targeted at 50% of his base salary. Based on the Company's
achievement of the performance measures applicable for fiscal 1998, the bonus
actually paid to Mr. Duval was $119,700.
During fiscal 1998, the Committee granted Mr. Duval options to purchase 27,000
common shares. This represents the normal annual grant under the 1994 Long-Term
Incentive Stock Plan. In determining the size of the award, the Committee
evaluated the accomplishments of major strategic objectives as well as Mr.
Duval's potential for influencing future results. Consideration was also given
to the relationship of previous grants and his total number of outstanding
options.
The Committee believes its compensation policies and program for executive
officers, including the Chief Executive Officer, effectively tie executive
compensation to the Company's performance and shareholder value.
THE COMPENSATION COMMITTEE
Robert J. Kegerreis, Chairman
William D. Manning, Jr.
Jerome F. Tatar
9
<PAGE> 12
EXECUTIVE COMPENSATION
The following sections show compensation information relating to the Chief
Executive Officer and the next four most highly compensated executive officers
of the Company at August 31, 1998. The information is presented on a fiscal year
basis.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
LONG-TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
NAME AND NUMBER OF SHARES ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS UNDERLYING OPTIONS COMPENSATION(1)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Daniel W. Duval, 1998 $420,000 $119,700 27,000 $5,900
President and 1997 400,000 310,000 27,000 5,700
Chief Executive Officer 1996 375,000 375,000 27,000 5,420
Gerald M. Connelly, 1998 $310,000 $ 88,350 20,000 $5,890
Executive Vice President and 1997 280,000 217,000 20,000 5,226
Chief Operating Officer 1996 236,000 220,000 20,000 2,853
Stephen R. Ley, 1998 $165,000 $ 37,620 15,000 $4,489
Vice President, Finance and 1997 128,000 69,440 7,500 4,461
Chief Financial Officer(2)
George M. Walker, 1998 $120,000 $ 45,828 -- $3,806
Vice President, 1997 201,000 124,620 -- 4,842
Development 1996 189,000 151,200 10,000 4,071
Kevin J. Brown, 1998 $113,500 $ 22,643 6,000 $3,152
Controller 1997 98,700 38,246 2,500 4,055
1996 94,000 45,500 2,500 2,015
- ---------------------------------------------------------------------------------------------------
</TABLE>
(1) All amounts presented are Company contributions under its Employee Savings
Plan.
(2) Mr. Ley became an executive officer of the Company on December 11, 1996.
10
<PAGE> 13
FISCAL 1998 STOCK OPTION GRANTS
The following table presents information concerning stock options granted in
fiscal 1998 to the persons named in the Summary Compensation Table. The table
also shows the hypothetical gains that would exist for the options at the end of
their ten-year terms, assuming compound rates of stock appreciation of 0%, 5%
and 10%. The actual future value of the options will depend on the market value
of the Company's common shares.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS(1)
------------------------------------------------- POTENTIAL REALIZABLE VALUE
NUMBER OF % OF TOTAL AT ASSUMED ANNUAL RATES
SHARES OPTIONS OF STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERM(2)
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION ---------------------------
NAME GRANTED FISCAL 1998 PRICE DATE 0% 5% 10%
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Daniel W. Duval 27,000 19% $24.44 6/22/08 $ 0 $414,999 $1,051,679
Gerald L. Connelly 20,000 14% $24.44 6/22/08 0 307,404 779,021
Stephen R. Ley 15,000 10% $24.44 6/22/08 0 230,553 584,266
George M. Walker -- -- -- -- -- -- --
Kevin J. Brown 6,000 4% $24.44 6/22/08 0 92,221 233,886
- --------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Under the Company's option plans, one-third of the shares subject to an
option may be purchased one year after the date of grant, two-thirds after
two years, and 100% after three years and the options have a 10-year term.
(2) The dollar amounts under these columns are the result of calculations at 0%
and at the 5% and 10% rates, assuming annual compounding, prescribed by
rules of the Securities and Exchange Commission and are not intended to
forecast possible appreciation, if any, of the Company's share price.
OPTION EXERCISES IN FISCAL 1998 AND FISCAL YEAR-END OPTION VALUES
The following table presents information concerning all exercises of options to
purchase Company shares during fiscal 1998 by the persons named in the Summary
Compensation Table and the value of all unexercised options at August 31, 1998.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT 8/31/98 OPTIONS AT 8/31/98(2)
SHARES ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Daniel W. Duval -0- -0- 222,000 54,000 $3,054,910 $12,330
Gerald L. Connelly -0- -0- 70,000 40,000 659,688 9,132
Stephen R. Ley -0- -0- 9,000 20,000 80,105 -0-
George M. Walker 29,833 $820,394 10,834 3,333 97,193 4,555
Kevin J. Brown -0- -0- 2,166 8,334 8,331 4,169
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the excess of the market value of the acquired shares on the
dates of exercise over the aggregate option price paid.
(2) Represents the excess of the market value at August 31, 1998 of the shares
subject to the options over the aggregate option exercise price.
11
<PAGE> 14
PENSION PLAN
The Company has a noncontributory, defined benefit pension plan for officers and
other salaried employees (the "Pension Plan"). The Company calculates retirement
benefits under the Pension Plan on the basis of the employee's average annual
compensation for the five highest years during the employee's last ten years of
employment with reductions for credited years of service less than 35. The
maximum annual retirement benefit that the Company can pay under the Pension
Plan to any participant as a result of limitations imposed under sections of the
Internal Revenue Code is presently $130,000.
Compensation for the purpose of calculating retirement benefits includes salary
and bonuses (exclusive of deferred incentive compensation). The total amount of
such compensation for executive officers for fiscal 1998 is presented in the
Summary Compensation Table under the heading "Annual Compensation."
The Company also has a Supplemental Pension Plan (the "Supplemental Plan") which
provides supplemental retirement benefits for Messrs. Duval, Connelly, Walker
and other key employees as they obtain eligibility under the criteria
established by the Board for participation in the Supplemental Plan. The
supplemental retirement benefit is provided under terms and conditions similar
to those under the Pension Plan except the Supplemental Plan allows for the
crediting of additional years of service by the Committee. The supplemental
retirement benefit is equal to the excess of (i) the benefit that would have
been payable to the employee under the Pension Plan without regard to certain
annual retirement income and benefit limitations imposed by federal law and at
the year of service credited under the Supplemental Plan over (ii) the benefit
payable to the employee under the Pension Plan.
The following table shows the estimated maximum annual retirement benefits
payable at normal retirement (age 65) under the Pension Plan and Supplemental
Plan at selected compensation levels after various years of service. The
credited years of service for the persons named in the Summary Compensation
Table is: Mr. Duval -- 16, Mr. Connelly -- 4, Mr. Ley -- 3, Mr. Walker -- 35,
and Mr. Brown -- 2. Amounts shown are straight life annuity amounts. These
amounts are not reduced to take into account Social Security benefits paid to
the employee.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL RETIREMENT BENEFITS
FOR SPECIFIED YEARS OF SERVICE
FINAL AVERAGE
COMPENSATION 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
<S> <C> <C> <C> <C> <C>
$200,000 $ 40,918 $ 54,544 $ 68,169 $ 81,794 $ 95,378
250,000 51,418 68,543 85,668 102,793 119,876
300,000 61,919 82,544 103,170 123,796 144,379
350,000 72,418 96,544 120,669 144,794 168,878
400,000 82,918 110,543 138,168 165,793 193,376
500,000 103,918 138,544 173,169 207,794 242,378
600,000 124,919 166,544 208,170 249,796 291,379
</TABLE>
12
<PAGE> 15
OTHER
In fiscal 1998, the Compensation Committee of the Board recommended, and the
Board approved, a non-interest bearing loan in the amount of $268,616 to Daniel
W. Duval, President and Chief Executive Officer of the Company. The loan was
made to assist him in the payment of taxes associated with the issuance to him
in October 1997 of 15,313 restricted common shares of the Company as a payout of
a long-term incentive award for the three-year period ended August 31, 1996.
Sale of such shares is prohibited until certain vesting periods expire. At
August 31, 1998, the entire amount of the loan had been repaid.
The Company has agreed to pay to Mr. Duval one year's salary in the event the
Company terminates his employment as Chief Executive Officer for reasons other
than misconduct. If such termination occurs after a change of control of the
Company (as defined in the agreement), his salary continues for a three-year
period.
The Company entered into an agreement with Mr. Connelly in December 1997. If the
Company terminates his employment for reasons other than misconduct within two
years after a change of control of the Company, the Company will continue to pay
his salary for a three-year period.
13
<PAGE> 16
PERFORMANCE GRAPH
The following graph compares the cumulative total return to shareholders on the
Company's common shares for its last five fiscal years with the cumulative total
return of the Russell 2000 Company Group Index and the S&P Diversified Machinery
Index for the same periods. The graph depicts the value on August 31, 1998 of a
$100 investment made on August 31, 1993 in Company shares and each index, with
all dividends reinvested.
<TABLE>
<CAPTION>
Robbins & S&P Machinery
Myers, Inc. Russell 2000 (Diversified)
<S> <C> <C> <C>
Aug-93 100 100 100
Aug-94 102 106 111
Aug-95 151 128 128
Aug-96 244 142 142
Aug-97 364 183 218
Aug-98 267 150 155
</TABLE>
APPOINTMENT OF INDEPENDENT AUDITORS
Ernst & Young LLP served as the Company's independent auditors during the fiscal
year ended August 31, 1998. A representative of Ernst & Young LLP is expected to
be present at the Annual Meeting with the opportunity to make a statement if he
desires to do so and to respond to appropriate questions from shareholders.
Subject to ratification by the shareholders, the Board of Directors of the
Company has selected Ernst & Young LLP as independent auditors for the Company
for the fiscal year ending August 31, 1999. THE BOARD RECOMMENDS A VOTE "FOR"
THE PROPOSAL TO RATIFY SUCH SELECTION. In the event shareholders do not approve
the selection of Ernst & Young LLP, the Board will seek to determine from
shareholders the principal reasons Ernst & Young LLP was not approved, evaluate
such reasons, and consider whether, in view of the circumstances, a different
firm of independent auditors should be selected for fiscal 1999.
14
<PAGE> 17
OTHER MATTERS
The Board of Directors does not know of any matters to be presented at the
meeting other than those mentioned above. However, if other matters should
properly come before the meeting, or any adjournment thereof, it is intended
that the Board's proxy agents will vote the proxies in their discretion.
The Company will bear the cost of soliciting proxies. In addition to the use of
the mails, certain officers, directors, and regular employees of the Company may
solicit proxies by telephone or personal interview. The Company will request
brokerage houses, banks and other persons to forward proxy material to the
beneficial owners of shares held of record by such persons.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires directors and
executive officers of the Company and owners of more than 10% of the Company's
common shares to file an initial ownership report with the Securities and
Exchange Commission and a monthly or annual report listing any subsequent change
in their ownership of common shares. The Company believes, based on information
provided to the Company by the persons required to file such reports, that all
filing requirements applicable to such persons during the period from September
1, 1997 through August 31, 1998, were met, except that the sale of 266 common
shares by Mr. Walker and the exercise of a 4,000 share option by Dr. Kegerreis
were inadvertently reported late.
SHAREHOLDER PROPOSALS
If you intend to submit a proposal for inclusion in the Company's proxy
statement and form of proxy for the 1999 Annual Meeting of Shareholders, the
Company must receive the proposal at 1400 Kettering Tower, Dayton, Ohio 45423,
Attention: Secretary, on or before July 12, 1999. The 1999 Annual Meeting of
Shareholders is presently scheduled to be held on December 8, 1999.
By Order of the Board of
Directors,
Joseph M. Rigot
Secretary
15
<PAGE> 18
[ROBBINS MYERS LOGO]
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS ON DECEMBER 9, 1998
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned holder(s) of Common Shares of ROBBINS & MYERS, INC., an Ohio
corporation (the "Company"), hereby appoints Daniel W. Duval, Robert J.
Kegerreis, and Maynard H. Murch IV, and each of them, attorneys of the
undersigned, with power of substitution, to vote all of the Common Shares which
the undersigned is entitled to vote at the Annual Meeting of Shareholders of the
Company to be held on Wednesday, December 9, 1998, and at any adjournment
thereof, as follows:
<TABLE>
<S> <C> <C>
1. Election of Directors. [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY
(except as marked to the contrary to vote for all nominees listed
below), including authority to below.
cumulate votes selectively among
such nominees.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME BELOW.)
Daniel W. Duval, Thomas P. Loftis, Jerome F. Tatar
2. Approval of the appointment of Ernst & Young LLP as independent auditors for the Company.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, upon such other business as may properly come before the meeting or any adjournment thereof.
</TABLE>
(CONTINUED AND TO BE SIGNED AND DATED ON THE OTHER SIDE)
- -------------------------------------------------------------------------------
A VOTE FOR PROPOSALS 1 AND 2 IS RECOMMENDED BY THE BOARD OF DIRECTORS. WHEN
PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS SPECIFIED, THIS PROXY WILL BE VOTED
FOR PROPOSALS 1 AND 2.
Receipt is acknowledged of Notice of the above meeting, the Proxy Statement
relating thereto and the Annual Report to Shareholders for the fiscal year ended
August 31, 1998.
DATED: _______________________, 1998
-----------------------------
SIGNATURE
-----------------------------
SIGNATURE (IF HELD JOINTLY)
SHAREHOLDERS SHOULD DATE THIS
PROXY AND SIGN HERE EXACTLY AS
NAME APPEARS AT LEFT. IF STOCK
IS HELD JOINTLY, BOTH OWNERS
SHOULD SIGN THIS PROXY.
EXECUTORS, ADMINISTRATORS,
TRUSTEES, GUARDIANS AND OTHERS
SIGNING IN A REPRESENTATIVE
CAPACITY SHOULD INDICATE THE
CAPACITY IN WHICH THEY SIGN.
