REINHOLD INDUSTRIES, INC.
12827 E. Imperial Highway
Santa Fe Springs, CA 90670
March 17, 1997
DEAR STOCKHOLDERS:
The Directors and Officers of Reinhold Industries, Inc., cordially invite you to
attend the Annual Meeting of Stockholders of the Corporation to be held on
Thursday, May 1, 1997 at 10:00 A.M., Pacific Time. The meeting will be held at
the office of the Corporation at 12827 E. Imperial Highway, Santa Fe Springs, CA
90670. Notice of the Annual Meeting and Proxy Statement are enclosed.
You are urged to mark, sign, date and mail the enclosed proxy immediately. By
mailing your proxy now you will not be precluded from attending the meeting.
Your proxy is revocable. In the event you find it convenient to attend the
meeting, you may, if you wish, withdraw your proxy and vote in person.
For your information, enclosed is the 1996 Annual Report of Reinhold Industries,
Inc.
Very truly yours,
/s/ Lawrwnce H. Diamond
LAWRENCE H. DIAMOND,
Chairman of the Board
<PAGE>
REINHOLD INDUSTRIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Santa Fe Springs, California
March 17, 1997
To the Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Reinhold Industries, Inc., a Delaware corporation ("Reinhold" or the "Company")
will be held at the offices of Reinhold Industries, Inc. 12827 East Imperial
Hwy, Santa Fe Springs, California on Thursday, May 1, 1997 at 10:00 A.M., local
time, for the following purposes:
(1) To elect one member of the Board of Directors for Class A Common
Stockholders and two members of the Board of Directors for Class B Common
Stockholders; and
(2) To transact such other business as may properly come before the
meeting and any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on March 10, 1997
are entitled to notice of and to vote at the meeting.
All stockholders are cordially invited to attend the meeting in person.
However, to assure your representation at the meeting, you are urged to sign and
return the enclosed proxy as promptly as possible in the postage-prepaid
envelope enclosed for that purpose. Any stockholder attending the meeting may
vote in person even if he or she has returned a proxy.
By order of the Board of Directors,
/s/David Blakesley
David M. Blakesley
Secretary
THE BOARD OF DIRECTORS SOLICITS THE EXECUTION AND IMMEDIATE RETURN OF THE
ACCOMPANYING PROXY. PLEASE DATE, SIGN AND RETURN THE PROXY IN THE ENCLOSED
ADDRESSED ENVELOPE.
<PAGE>
REINHOLD INDUSTRIES, INC.
12827 EAST IMPERIAL HWY
SANTA FE SPRINGS, CALIFORNIA 90670
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 1, 1997
March 17, 1997
PROXY STATEMENT
INTRODUCTION
The Annual Meeting of Stockholders of Reinhold Industries, Inc.
("Reinhold" or the "Company") will be held on May 1, 1997 at the offices of
Reinhold Industries, Inc., 12827 East Imperial Hwy, Santa Fe Springs,
California, at 10:00 A.M., for the purposes set forth in the accompanying
notice. This statement is furnished in connection with the solicitation by
Reinhold's Board of Directors (the "Board") of proxies to be voted at such
meeting and at any and all adjournments thereof. Proxies properly executed, duly
returned and not revoked will be voted at the Annual Meeting (including
adjournments) in accordance with the specifications therein. If a stockholder
does not specify on the proxy card how the shares are to be voted, they will be
voted FOR the election of Reinhold's nominee for Director.
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 (i) filing
with the Secretary of the Company, at or before the taking of the vote at the
Annual Meeting, a written notice of revocation bearing a later date than the
proxy; (ii) duly executing a later dated proxy relating to the same shares and
delivering it to the Secretary of the Company, before the taking of the vote at
the Annual Meeting or (iii) attending the Annual Meeting and voting in person
(although attendance at the Annual Meeting will not in and of itself constitute
a revocation of a proxy). Any written notice of revocation or subsequent proxy
should be sent so as to be delivered to Reinhold Industries, Inc., 12827 East
Imperial Hwy, Santa Fe Springs, California 90670, Attention: Secretary or
hand-delivered to the Secretary of the Company, in each case at or before the
taking of the vote at the Annual Meeting.
At the Annual Meeting, holders of Reinhold Class A and Class B Common
Stock shall each have one vote per share.
This proxy statement and accompanying form of proxy are first being
sent to stockholders on or about March 17, 1997.
<PAGE>
PLAN OF REORGANIZATION
On July 31, 1996 (the "Effective Date"), Keene Corporation ("Keene")
consummated its plan of reorganization under the Bankruptcy Code (the "Plan")
and emerged from bankruptcy. On the Effective Date, Reinhold was merged into and
with Keene, with Keene becoming the surviving corporation. Pursuant to the
merger, all of the issued and outstanding capital stock of Reinhold was
canceled. Keene, as the surviving corporation of the merger, was renamed
Reinhold. On the Effective Date, Reinhold issued 2,000,000 shares of Common
Stock, of which 1,020,000 shares of Class B Common Stock were issued to the
Trustees of a Creditors' Trust (the "Keene Creditors' Trust") set up to
administer Keene's asbestos claims. The remaining 980,000 shares of Class A
Common Stock were issued to Keene's former stockholders as of record date, June
30, 1996. All of Keene's previous outstanding Common Stock were canceled.
QUORUM; VOTE REQUIRED
The required quorum for the transaction of business at the Annual
Meeting is a majority of the shares of Class A Common Stock and a majority of
the shares of Class B Common Stock, respectively. The Company intends to include
abstentions and broker non-votes as present or represented for purposes of
establishing a quorum for the transaction of business, but to exclude broker
non-votes from the calculation of shares entitled to vote with respect to any
proposal for which authorization to vote was withheld.
In the election of directors, the director elected by the holders of
Class A Common Stock must be elected by a plurality of the shares of Class A
Common Stock voting. Each director elected by the holder of Class B Common Stock
must be elected by a majority of the shares of Class B Common Stock voting.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
At the Annual Meeting, the holders Class A Common Stock, voting as a
class, shall elect one (1) Director of the Company to serve until the next
Annual Meeting to be held in 1998 and until his successor is elected and
qualified. The Board is soliciting proxies to vote FOR its nominee, Michael T.
Furry, as Director of Reinhold. Only holders of Class A Common Stock shall vote
for the Class A nominee. The holder of Class B Common Stock, voting as a class,
shall elect two (2) directors of the Company each to serve until the next Annual
Meeting to be held in 1998 and until their successor is elected and qualified.
The Board is soliciting proxies to vote FOR each of its nominees, Robert B.
Steinberg and Lawrence H. Diamond, as Directors of Reinhold. Only the holder of
Class B Common Stock shall vote for the Class B nominees.
All proxies will be voted in accordance with the stated instructions.
If the nominee ceases to be a candidate for election for any reason, the proxy
will be voted for a substitute nominee designated by the Board. The Board
currently has no reason to believe that these nominees will be unwilling or
unable to serve as directors, if elected.
<PAGE>
NOMINEE FOR CLASS A DIRECTOR
MICHAEL T. FURRY
Mr. Furry, age 59, is President of Reinhold. Mr. Furry has served as
President of Reinhold since June 1986 and became President of the Reorganized
Company on the Effective Date. Mr. Furry had been a Director of Keene since
April 1990. From April 1976 to June 1986, Mr. Furry was Vice President and
General Manager of the composites division of Reynolds & Taylor, Inc. Mr.
Furry is a member of the audit committee.
NOMINEES FOR CLASS B DIRECTORS
LAWRENCE H. DIAMOND
Mr. Diamond, age 56, became a director of Reinhold on the Effective
Date and is currently Chairman of the Board. Mr. Diamond is currently a
consultant for Ernst & Young LLP. He has enjoyed a long and distinguished
career in public accounting with Kenneth Leventhal & Co. and Ernst & Young LLP.
He has been an instructor in Real Estate Finance at UCLA. Mr. Diamond also
serves on the Boards of several not-for-profit organizations, which include
the San Fernando Valley Association for the Retarded and Valley Village. He is
a member of the audit committee and the compensation committee.
ROBERT B. STEINBERG
Mr. Steinberg, age 68, became a director of Reinhold on July 31,
1996, the Effective Date of the Plan of Reorganization. Mr. Steinberg is a
Senior Partner at the law firm of Rose, Klein & Marias. He has been with Rose,
Klein & Marias for over 41 years. He also serves on the Board of Directors of
UNR Industries. Mr. Steinberg is a member of the audit committee and the
compensation committee.
OTHER EXECUTIVE OFFICER
DAVID M. BLAKESLEY
Mr. Blakesley, age 52, became Vice President - Finance and
Administration, Secretary and Treasurer of Reinhold in April 1996. He was
controller of Reinhold from May 1995 to April 1996. Prior to coming to Reinhold,
Mr. Blakesley worked as a regional controller and as a controller and general
manager at several divisions of Bairnco Corporation.
COMPENSATION OF DIRECTORS
Prior to the Effective Date, the Board of Keene met 8 times for regular
meetings and there were 3 special meetings. Each non-employee director received
$2,000.00 for each regular and special meeting. The Board also established a
Legal Committee of the Board which met 5 times prior to the Effective Date and
each non-employee director received $2,000.00 per meeting. Prior to the
Effective Date, there were no meetings of the Audit Committee or the
Compensation Committee.
After the Effective Date, the new Board of Reinhold met one time for a
regular meeting and there were two special meetings. Each non-employee director
received $1,000.00 for each regular or special meeting of the Board he attended
post Effective Date and will receive $1,000.00 for each such regular meeting in
1997. In addition, each non-employee director also receives annual compensation
of $12,000.00 per year, paid quarterly, as a retainer for being a director.
Reinhold has standing Audit and Compensation Committees of the Board.
The Audit Committee met once post Effective Date. The Compensation Commitee did
not meet. The non-employee directors who are members of the Audit and
Compensation Committees receive $1,000.00 for each meeting attended on a day
during which the Board did not meet for a regular meeting and will receive
$1,000.00 for each such meeting in 1997.
<PAGE>
The Audit Committee reviews and recommends to the Board the engagement
of the independent auditors of the Company, reviews with the auditors their work
and fees and reviews accounting policies and practices and internal accounting
controls of the Company.
The Compensation Committee reviews and recommends to the Board the
compensation proposed to be paid to officers and key employees of Reinhold,
including base salaries, stock options and management incentive compensation.
The Board does not have a Nominating Committee and as a whole performs
the functions normally performed by a Nominating Committee.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
NUMBER OF SHARES OUTSTANDING, RECORD DATE AND LIST OF STOCKHOLDERS
Only stockholders of record at the close of business on March 10, 1997
are entitled to notice of, and to vote at, the Annual Meeting. At the close of
business on such date there were 980,000 shares of Reinhold Class A Common Stock
Outstanding and 1,020,000 shares of Reinhold Class B Common Stock outstanding. A
stockholder list will be available for examination by stockholders at the Annual
Meeting.
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information regarding the beneficial
ownership of Reinhold Common Stock, either Class A or Class B, by the only
person known by Reinhold to be a beneficial owner of 5% or more of Reinhold's
issued and outstanding Common Stock as of March 3, 1997. By virtue of the fact
that it owns 51% of the outstanding Common Stock of Reinhold and appointed two
members to the Board, the Keene Creditors' Trust may be deemed to be a
controlling person of Reinhold.
<TABLE>
<CAPTION>
Percentage of
Amount and Nature of Issued and
Name and Address of Beneficial Ownership Outstanding
Beneficial Owner of Common Stock Common Stock
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Keene Creditors' Trust 1,020,000 51%
The Chancery Class B
190 Willis Avenue
Mineola, NY 11501
</TABLE>
<PAGE>
COMMON STOCK OWNERSHIP OF MANAGEMENT
The following table presents information regarding beneficial ownership
of Reinhold Common Stock by each member of the Board of Directors, and by all
current directors and officers of Reinhold as a group, as of March 3, 1997.
<TABLE>
<CAPTION>
Amount and Nature of Percentage of Issued and
Name and address of Beneficial Ownership Outstanding Common Stock
Beneficial Owner of Reinhold Common Stock on March 3, 1997(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Michael T. Furry 8,115 (2)
12827 East Imperial Highway
Santa Fe Springs, CA 90670
Robert B. Steinberg -- --
c/o Rose, Klein & Marias
801 South Grand, 18th Floor
Los Angeles, CA 90017
Lawrence H. Diamond -- --
2049 Century Park East
Suite 1700
Los Angeles, CA 90067
David M. Blakesley 100 (2)
12827 East Imperial Highway
Santa Fe Springs, CA 90670
All directors and officers of Reinhold as
a group (4 persons including those
named above) 8,215 (2)
- ------------
<FN>
(1) For the purposes of this table, the issued and outstanding Common Stock
of Reinhold has been calculated for each individual on the basis of all
shares of Common Stock issued and outstanding (excluding treasury
shares) on March 3, 1997.
(2) The percentage of shares owned does not exceed 1% of the issued and outstanding Common Stock.
</FN>
</TABLE>
COMPENSATION OF MANAGEMENT
The following table sets forth a summary of the compensation paid to
the Chief Executive Officers and former controller of the Company for services
rendered in all capacities to the Company for the fiscal years ended December
31, 1996, 1995 and 1994. No executive officers of the Company other than the
Chief Executive Officers and the former controller were paid annual salary
(together with any bonus) in excess of $100,000 in such fiscal years for
services rendered to the Company.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Comp
- ---------------------------------------------------------------------------------------------------------------------------
Name and Fiscal Mgmt. Other Annual Securities Under- All Other
Principal Position Year Salary Incentive Compensation lying Options/SARS Comp.(5)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Michael T. Furry 1996 $195,833 -- $15,188 (6) -- --
President and 1995 $162,346 -- -- -- --
Chief Executive 1994 $150,000 $40,000 -- -- --
Officer (1)
Timothy E. Coyne 1996 $110,833 -- -- -- $184,826
President and 1995 $163,750 -- -- -- 130,391
Chief Executive 1994 $149,167 $40,500 -- -- 10,788
Officer (2)
Glenn W. Bailey 1996 $ 33,833 -- -- -- $ 35,573
President and 1995 $200,000 -- -- -- --
Chief Executive 1994 $200,000 -- -- -- --
Officer (3)
Norman N. 1996 $ 74,667 -- $ 7,032 (6) -- $101,626
Weinstock 1995 $128,000 -- -- -- 114,744
Controller (4) 1994 $120,000 $32,500 -- -- 9,728
- -------------------------------------
<FN>
(1) Mr. Furry became President and Chief Executive Officer of the Company as of the Effective Date.
(2) Mr. Coyne was President and Chief Executive Officer of Keene from March
1, 1996 to July 31, 1996, the Effective Date. He was also Chief
Financial Officer of Keene from May 1990 through the Effective Date.
(3) Mr. Bailey was President and Chief Executive Officer of Keene until March 1, 1996. He left that position, but
continued to serve as an outside director of the Company until the Effective Date.
(4) Mr. Weinstock was controller of Keene from August 1990 until the Effective Date.
(5) All Other Compensation includes severance pay for former Keene
employees in 1996, the payment of the Employee Retention Program of
Keene in 1995 and interest income on the Employee Retention Program
funds in 1994.
(6) Mr. Furry and Mr. Weinstock exercised stock options that resulted in compensation.
</FN>
</TABLE>
<PAGE>
AGGREGATE OPTION EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR END OPTIONS
The following table sets forth the number of options exercised and
redeemed and the realized value upon exercise and redemption by the named
executive officers during the fiscal year ended December 31, 1996 and the value
of outstanding options held by each executive officer as of December 31, 1996.
<TABLE>
<CAPTION>
No. of Securities Value of
Underlying Un- Unexercised
exercised Options In-the-Money
No. Shares at Fiscal Year-end Options at Fiscal
Acquired on Value Exercisable / Year-end Exercisable
Name Exercise Realized Unexercisable / Unexercisable
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michael T. Furry 75,000 (1) $15,188 0/0 (3) 0/0 (3)
Timothy E. Coyne -- -- -- --
Glenn W. Bailey -- -- -- --
Norman N. Weinstock 37,500 (2) $7,032 -- --
- -------------------------------------
<FN>
(1) Mr. Furry exercised his Keene stock options before the Effective Date. When the shares were converted to Reinhold
shares, he received 6,839 shares of Reinhold.
(2) Mr. Weinstock exercised his Keene stock options before the Effective Date. He is no longer an officer of the
reorganized company.
(3) On the Effective Date of the Reorganization, all outstanding Keene
stock options were extinguished. No stock options or SAR's have been
issued under the new Reinhold Stock Incentive Plan.
</FN>
</TABLE>
EMPLOYMENT AGREEMENT
An employment agreement with Michael T. Furry, as the Company's
President and Chief Executive Officer, was entered into on July 31, 1996 and
provides for employment by the Company for a period of five years commencing on
the Effective Date. The employment agreement provides for a base salary of
$225,000 per year. The employment agreement provides for participation in the
Management Incentive Compensation Program, Reinhold Industries, Inc. Pension
Plan and Reinhold Stock Incentive Plan. It also provides Mr. Furry with life
insurance with a face value of $200,000.
<PAGE>
MANAGEMENT INCENTIVE COMPENSATION PLANS
Keene Management Incentive Compensation Plan
Prior to the Effective Date, the Board approved a Management Incentive
Compensation Plan for headquarters staff, under which awards may be made to
officers and other key salaried employees. Non-employee directors and Mr. Bailey
are not eligible to participate. Pools of award money are developed in
accordance with the value of retained assets. Distribution of awards to eligible
employees will be dependent upon the individual employee's achievement during a
fiscal year, as measured against predetermined specific objectives for that
employee in such fiscal year. Payments will be made in January of each year with
respect to the previous year's award.
Reinhold Management Incentive Compensation Plan
As a result of the Plan of Reorganization, Reinhold adopted the
Management Incentive Compensation Plan for the Reinhold staff, under which
awards may be made to officers and other key salaried employees of Reinhold.
Pools of award money are developed in accordance with the earnings of Reinhold
and will be limited to 15% of Reinhold's net income each year. Distribution of
awards to eligible employees will be dependent upon the individual employee's
achievement during a fiscal year, as measured against predetermined specific
objectives for that employee in such fiscal year. Payments will be made in
January of each year with respect to the previous year's award.
EMPLOYEE RETENTION PROGRAM
The Board of Keene Corporation (Pre Effective Date) had approved an
Employee Retention Program for headquarters staff of Keene to retain the
services of officers and key headquarters staff during the ongoing asbestos
litigation because of the uncertain effect of this litigation upon Keene's
financial position. The Employee Retention Program required the payment on
January 15, 1995 of an amount approximately equal to the annual base
compensation of each employee or upon the occurrence of certain events. If an
employee voluntarily terminates or was terminated for cause, all rights under
the Employee Retention Program were forfeited. As consideration the officers and
key employees must refrain from competing with Keene (or its predecessor) for a
period of one year after payment.
RETIREMENT PLAN
Reinhold presently maintains a non-contributory retirement plan (the
"Retirement Plan") in which all salaried employees and certain hourly employees
participate. The Retirement Plan provides an annual normal retirement benefit at
or after age 65 for a participant equal to the greater of (a) the participants'
accrued benefit as of December 31, 1988, based on the plan in effect at that
time; (b) the product of (x) the sum of 1.3% of the participant's annual average
compensation for the five highest consecutive years of employment during the
most recent ten calendar years of employment and 0.65% of such compensation in
excess of the average of the "Social Security Taxable Wage Base" in each year
during the 35 year period prior to the participant's retirement age under the
social security law multiplied by (y) his years of service credit (to a maximum
of 25) in the Retirement Plan; or (c) the accrued benefit as of December 31,
1993, plus a benefit based on (b) above and service after December 31, 1993,
with total service not in excess of 25 years. Certain maximum benefit
limitations are incorporated in the Retirement Plan. The Retirement Plan permits
a participant who has attained age 55 and completed 10 years of service to elect
to receive an actuarially reduced early retirement benefit and provides for
payment of benefits if
<PAGE>
certain participants become permanently disabled. A participant's accrued
pension benefit becomes 100% vested on the date on which the participant
completes five years of service. Death benefits are payable to the surviving
spouse of a fully or partially vested participant who dies before payment of
benefits has commenced.
The following table presents information regarding estimated annual
benefits payable upon normal retirement classified by remuneration and years of
service under the Reinhold Industries, Inc. Retirement Plan in which all
salaried employees and certain hourly employees participate:
<TABLE>
<CAPTION>
Average
Compensation
at Retirement Years of Service at Retirement
- ---------------------------------------------------------------------------------------------------------------------------
5 10 15 20 25 or more
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 50,000(1) $ 3,979 $ 7,958 $11,936 $15,915 $ 19,894
75,000(1) 6,416 12,833 19,249 25,665 32,081
100,000(1) 8,854 17,708 26,561 35,415 44,269
150,000(1) 13,729 27,458 41,186 54,915 68,644
or more
- -------------------------------------
<FN>
(1) In accordance with IRS Regulations, the maximum allowable compensation
permitted in computing a benefit under the Retirement Plan is $150,000 for 1996.
However, employees will receive the greater of the benefit outlined above or the
accrued benefit as of December 31, 1993, which was based on compensation in
excess of $150,000 plus a benefit based on service after December 31, 1993 and
the final average compensation based on the $150,000 limit.
Remuneration covered by the Retirement Plan in a particular year
includes that year's base salary, overtime pay and commissions but excludes
compensation received in that year under the Management Incentive Compensation
Plan in excess of 50% of the participant's annual basic pay rate as of the
December 31 of the preceding calendar year. The 1996 remuneration covered by the
Retirement Plan for each participant therefore includes management incentive
compensation (up to such 50% ceiling) paid during 1996 in respect of 1995
awards.
For each of the following persons, the credited years of service under
the Retirement Plan, as of December 31, 1996, and the remuneration received
during 1996 covered by the Retirement Plan, were, respectively, as follows: Mr.
Furry, 11 years and $150,000, Mr. Coyne, 9 years and $150,000, Mr. Weinstock, 6
years and $150,000.
</FN>
</TABLE>
STOCK INCENTIVE PLAN
General Description
Prior to the Effective Date, Keene had adopted the Keene Corporation
1990 Stock Incentive Plan (the "Keene Stock Plan") to assist in attracting and
retaining skilled management personnel. The Keene Stock Plan was approved by
Keene's former parent company and sole stockholder. The Keene Stock Incentive
Plan was replaced by the Reinhold Industries, Inc. Stock Incentive Plan (the
"Reinhold Stock Plan") on the Effective Date of the Plan of Reorganization. All
options outstanding under the Keene Stock Plan on the Effective Date were
extinguished.
As of the Effective Date, the Company established the Reinhold Stock
Plan for key employees. The Reinhold Stock Plan permits the grant of stock
options, stock appreciation rights and restricted stock. The total number of
shares of stock subject to issuance under the Reinhold Stock Plan may not exceed
100,000.The maximum number of shares of stock with respect to which options
or stock appreciation rights may be granted to any eligible employee during the
term of the Reinhold Stock Plan may not exceed 10,000. The shares to be
delivered under the Reinhold Stock Plan may consist of authorized but unissued
stock or treasury stock, not reserved for any other purpose.
The exercise price of the options is established at the discretion of a
Committee of the Board of Directors (the "Committee"), provided that it may not
be less than the estimated fair value at the time of grant. The Reinhold Stock
Plan provides that the options are exercisable based on vesting schedules,
provided that in no event shall such options vest more rapidly than 33 1/3 %
annually. The options expire no later than ten years from the date of grant.
The Committee, in its discretion, in connection with grant of an
option, may grant to the optionee Stock Appreciation Rights (SARs). A SAR will
entitle the holder of the related option, upon exercise of the Stock
Appreciation Right, to surrender such option, and receive payment of an amount
determined by multiplying (i) the excess of the fair market value of a share of
stock on the date of exercise of such SAR over the purchase price of a share of
stock under the related option, by (ii) the number of shares as to which the
SARs has been exercised.
The Committee may grant shares of restricted stock to eligible
employees and in such amounts as it shall determine in its sole discretion.
No options, SARs or restricted stock were granted under the Reinhold
Stock Plan.
Grants to Employees Under the Reinhold Stock Plan
Stock Options. The Compensation Committee can grant employees stock
options at an option exercise price not less than the fair market value of a
share on the date of grant. To exercise an option, an employee would pay the
option price in cash, or if permitted by the Committee, by delivering shares of
Reinhold Class A Common Stock already owned by the employee that have a fair
market value equal to the option price.
The term of each option is fixed by the Committee provided that no
option may be exercisable for more than 10 years after the date on which it
becomes exercisable. The Committee will determine the time or times at which
each option granted to an employee may be exercised as well as other terms and
conditions applicable to the option. Such options may be made exercisable in
installments, and the exercisability of options may be accelerated by the
Committee.
Stock Appreciation Rights. A SAR will entitle the holder of the related
option, upon exercise of the Stock Appreciation Right, to surrender such option,
and receive payment of an amount determined by multiplying (i) the excess of the
fair market value of a share of stock on the date of exercise of such SAR over
the purchase price of a share of stock under the related option, by (ii) the
number of shares as to which the SARs has been exercised.
A Stock Appreciation Right will be exercisable at such time or times
and only to the extent that a related option is exercisable, and will not be
transferable except to the extent that such related option may be transferable.
A Stock Appreciation Right granted in connection with an incentive stock option
shall be exercisable only if the fair market value of a share of stock on the
date of exercise exceeds the purchase price of a share of stock specified in the
related option.
<PAGE>
Upon the exercise of a Stock Appreciation Right, the related option
shall be canceled to the extent of the number of shares of Stock as to which the
Stock Appreciation Right is exercised, and upon the exercise of an option
granted in connection with a Stock Appreciation Right, the Stock Appreciation
Right shall be canceled to the extent of the number of shares of stock as to
which the option is exercised or surrendered.
Restricted Stock. The Committee, at any time and from time to time, may
grant shares of Restricted Stock under the Reinhold Stock Plan to such Eligible
Employees and in such amounts as it shall determine in its sole discretion. Each
grant of Restricted Stock shall be made pursuant to a written agreement which
shall contain such restrictions, terms and conditions as the Committee may
determine in its discretion. Restrictions upon shares of Restricted Stock shall
lapse at such time or times and on such terms and conditions as the Committee
may determine; provided, however, that in no event shall such restrictions on
vesting lapse at a rate more rapidly, on an annual basis, than 33 1/3% of the
number of shares such Restricted Stock subject to such grant beginning on the
first anniversary date following the grant of such Restricted Stock.
Termination of Employment. Unless otherwise determined by the
Committee, in the event of termination of employment by reason of retirement,
long term disability or death, any option may thereafter be exercised in full
for a period of three years (or such shorter period as the Committee shall
determine at grant), subject in each case to the stated term of the option. In
the event of termination of employment for any reason other than retirement,
disability or death, unless otherwise determined by the Committee, any
outstanding options held by the terminated employee will be canceled. The
Committee may permit an employee whose employment terminates for any such other
reason up to three years following termination to exercise an option.
Change in Control Provisions. The Reinhold Stock Plan provides that,
except as provided below, in the event of a "Change in Control" (as defined in
the Reinhold Stock Plan), the Committee, either at the time Employee Options or
shares of Restricted Stock are granted, or, if so provided in the applicable
Option Agreement or Restricted Stock grant, at any time thereafter, shall [have
the authority to] accelerate in whole or in part the exercisability of Employee
Options and/or the last day of the period of restriction upon a Change in
Control. The Option Agreements and Restricted Stock grants approved by the
Committee may contain provisions whereby, in the event of a Change in Control,
the acceleration of the exercisability of Employee Options and/or the last day
of the period of restriction may be automatic or may be subject to the
discretion of the Committee or may depend upon whether the Change in Control
shall be approved by a majority of the members of the Board or such other
criteria as the Committee may specify. Nothing herein shall obligate the
Committee to take any action upon a Change in Control.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of Reinhold has selected KPMG Peat Marwick,
independent public accountants, to audit Keene's books and accounts for the year
ending December 31, 1996. A representative of KPMG Peat Marwick will be present
at the Annual Meeting with an opportunity to make a statement, if desired, and
will be available to respond to appropriate questions from stockholders present.
<PAGE>
PROPOSALS BY HOLDERS OF COMMON STOCK
Any proposal which a stockholder of Reinhold desires to be considered
for inclusion in the proxy statement relating to the 1998 Annual Meeting of
Stockholders must be received by Reinhold at its executive offices no later than
November 7, 1997. The offices of Reinhold are located at 12827 East Imperial
Hwy, Santa Fe Springs, California, 90670.
EXPENSES AND OTHER MATTERS
Reinhold will pay the costs of preparing, assembling and mailing this
proxy statement and the material enclosed herewith. Reinhold 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 Reinhold has agreed to reimburse them for their expenses in so
doing.
Management 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.
/s/ David M. Blakesley
David M. Blakesley
Secretary
March 17, 1997
PLEASE DATE, SIGN AND IMMEDIATELY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
ADDRESSED ENVELOPE.
<PAGE>
APPENDIX A
FORM OF PROXY - CLASS A SHARES
REINHOLD INDUSTRIES, INC.
12827 East Imperial Hwy
Santa Fe Springs, CA 90670
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints David M. Blakesley and Philip H. Milner, and
each of them, the proxies of the undersigned, with power of substitution in
each, to vote all Class A Common Stock of Reinhold Industries, Inc. that the
undersigned is entitled to vote at the Annual Meeting of Stockholders of such
Corporation to be held at the offices of Reinhold Industries, Inc., 12827 East
Imperial Hwy, Santa Fe Springs, California on Thursday, May 1, 1997 at 10:00
A.M., Pacific time, and at any adjournments thereof.
1. ELECTION OF DIRECTOR to serve until the next annual meeting after their
election: FOR nominee listed below(except as marked to the contrary).
----
WITHHOLD AUTHORITY to vote for nominee listed below.
-----
Michael T. Furry
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
- --------------------------------------------------------------------------------
PLEASE SIGN AND DATE THIS PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE
(Continued and to be signed on reverse side)
<PAGE>
(Continued side)
2. In their discretion, such other business as may properly come before the
meeting.
THIS PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED AS INSTRUCTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO CONTRARY INSTRUCTIONS ARE GIVEN, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEE, AS SET FORTH IN THE
ACCOMPANYING PROXY STATEMENT.
--------------------------------------
Date
--------------------------------------
Name of Registered Holder
--------------------------------------
Signature
--------------------------------------
Signature
Joint owners should each sign. When
signing as executor, administrator,
trustee or guardian, give your full
title as such.
<PAGE>
APPENDIX B
FORM OF PROXY - CLASS B SHARES
REINHOLD INDUSTRIES, INC.
12827 East Imperial Hwy
Santa Fe Springs, CA 90670
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints David M. Blakesley and Philip H. Milner, and
each of them, the proxies of the undersigned, with power of substitution in
each, to vote all Class B Common Stock of Reinhold Industries, Inc. that the
undersigned is entitled to vote at the Annual Meeting of Stockholders of such
Corporation to be held at the offices of Reinhold Industries, Inc., 12827 East
Imperial Hwy, Santa Fe Springs, California on Thursday, May 1, 1997 at 10:00
A.M., Pacific time, and at any adjournments thereof.
1. ELECTION OF TWO DIRECTORS to serve until the next annual meeting after
their election: FOR nominees listed below(except as marked to the contrary).
----
WITHHOLD AUTHORITY to vote for nominee listed below.
-----
Robert B. Steinberg Lawrence H. Diamond
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
- --------------------------------------------------------------------------------
PLEASE SIGN AND DATE THIS PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE
(Continued and to be signed on reverse side)
<PAGE>
(Continued side)
2. In their discretion, such other business as may properly come before the
meeting.
THIS PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED AS INSTRUCTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO CONTRARY INSTRUCTIONS ARE GIVEN, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES, AS SET FORTH IN THE
ACCOMPANYING PROXY STATEMENT.
--------------------------------------
Date
--------------------------------------
Name of Registered Holder
--------------------------------------
Signature
--------------------------------------
Signature
Joint owners should each sign. When
signing as executor, administrator,
trustee or guardian, give your full
title as such.
