REINHOLD INDUSTRIES, INC.
12827 E. Imperial Highway
Santa Fe Springs, CA 90670
March 13, 1998
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
Friday, May 1, 1998 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 1997 Annual Report of Reinhold Industries,
Inc.
Very truly yours,
/s/Lawrence H. Diamond
LAWRENCE H. DIAMOND,
Chairman of the Board
<PAGE>
REINHOLD INDUSTRIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Santa Fe Springs, California
March 13, 1998
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
Highway, Santa Fe Springs, California on Friday, May 1, 1998 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 6, 1998
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/ BRETT R. MEINSEN
BRETT R. MEINSEN
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, 1998
March 13, 1998
PROXY STATEMENT
INTRODUCTION
The Annual Meeting of Stockholders of Reinhold Industries, Inc.
("Reinhold" or the "Company") will be held on May 1, 1998 at the offices of
Reinhold Industries, Inc., 12827 East Imperial Highway, 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 Highway, 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 13, 1998.
<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 1,998,956 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 978,956 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 was canceled.
REQUIRED QUORUM; REQUIRED VOTE
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. Proxies that reflect
abstentions will be treated as voted for purposes of determining the approval of
the proposal and will have the same effect as a vote against the proposal.
In the election of directors, the director elected by the holders of
Class A Common Stock must be elected by a majority 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 of 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 1999 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 1999 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.
Unless the stockholder otherwise specifies therein, the accompanying proxy will
be voted (i) FOR the election of the nominees identified above, and (ii) at the
discretion of the proxy holders, either FOR or AGAINST any other matter or
businsess that may properly come before the meeting. The Board of Directors does
not know of any such other matter or business. 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 60, 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 57, 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. He is a member of the audit committee and the
compensation committee.
ROBERT B. STEINBERG
Mr. Steinberg, age 69, became a director of Reinhold on the Effective
Date. 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 Eagle-Pitcher Inc. and retired from the Board of Directors
of UNR Industries in December 1997. He is a member of the audit committee and
the compensation committee.
OTHER EXECUTIVE OFFICER
BRETT R. MEINSEN
Mr. Meinsen, age 38, became Vice President - Finance and
Administration, Secretary and Treasurer of Reinhold in June 1997. Prior to
coming to Reinhold, Mr. Meinsen worked from 1986 until January 1997 as the
Director of Finance and Administration, Manager of Financial Analysis, and a
senior financial analyst at Philips Medical Systems.
COMPENSATION OF DIRECTORS
During 1997, the Board of Directors of Reinhold met four times for
regular meetings 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
and will receive $1,000.00 for each such regular meeting in 1998. 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 and the Compensation Commitee met once. 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 1998.
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.
<PAGE>
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 6, 1998
are entitled to notice of, and to vote at, the Annual Meeting. At the close of
business on such date there were 978,956 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 February 20, 1998. 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 February 20, 1998.
<TABLE>
<CAPTION>
Amount and Nature of Percentage of Issued and
Name and address of Beneficial Ownership Outstanding Common Stock
BeneficialOwner of Reinhold Common Stock on February 20, 1998(1)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Michael T. Furry 11,115 (2)
12827 East Imperial Highway
Santa Fe Springs, CA 90670
Robert B. Steinberg 1,000 (2)
c/o Rose, Klein & Marias
801 South Grand, 18th Floor
Los Angeles, CA 90017
Lawrence H. Diamond 750 (2)
2049 Century Park East
Suite 1700
Los Angeles, CA 90067
Brett R. Meinsen -- --
12827 East Imperial Highway
Santa Fe Springs, CA 90670
All directors and officers of Reinhold as
a group (4 persons including those
named above) 12,865 (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 February 20, 1998.
(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, 1997, 1996 and 1995. 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 1997 $225,000 $47,800 -- -- --
President and 1996 $195,833 -- $15,188 (6) -- --
Chief Executive 1995 $162,346 -- -- -- --
Officer (1)
Timothy E. Coyne 1997 -- -- -- -- --
President and 1996 $110,833 -- -- -- $184,826
Chief Executive 1995 $163,750 -- -- -- $130,391
Officer (2)
Glenn W. Bailey 1997 -- -- -- -- --
President and 1996 $ 33,833 -- -- -- $ 35,573
Chief Executive 1995 $200,000 -- -- -- --
Officer (3)
Norman N. 1997 -- -- -- -- --
Weinstock 1996 $ 74,667 -- $7,032 (6) -- $101,626
Controller (4) 1995 $128,000 -- -- -- $114,744
- -------------------------------------
<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 and the payment of the Employee Retention Program of
Keene in 1995.
(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, 1997 and the value
of outstanding options held by each executive officer as of December 31, 1997.
<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 -- -- 0/0 (1) 0/0 (1)
Brett R. Meinsen -- -- 0/0 (1) 0/0 (1)
- -------------------------------------
<FN>
(1) No stock options or SAR's have been issued under the 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. Retirement
Plan, and Reinhold Stock Incentive Plan. It also provides Mr. Furry with life
insurance with a face value of $200,000.
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 pre-tax earnings 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.
<PAGE>
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 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) $ 3,923 $ 7,845 $11,768 $15,690 $ 19,613
75,000(1) 6,360 12,720 19,080 25,440 31,801
100,000(1) 8,798 17,595 26,393 35,190 43,988
150,000(1) 13,673 27,345 41,018 54,690 68,363
160,000(1) 14,648 29,295 43,943 58,590 73,238
or more
- -------------------------------------
<FN>
(1) In accordance with Internal Revenue Service Regulations, the maximum
allowable compensation permitted in computing a benefit under the Retirement
Plan is $160,000 for 1997. 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.
</FN>
</TABLE>
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 1997 remuneration covered by the
Retirement Plan for each participant therefore includes management incentive
compensation (up to such 50% ceiling) paid during 1997 in respect of 1996
awards.
For each of the following persons, the credited years of service under
the Retirement Plan, as of December 31, 1997, and the remuneration received
during 1997 covered by the Retirement Plan, were, respectively, as follows: Mr.
Furry, 12 years and $160,000.
<PAGE>
STOCK INCENTIVE PLAN
General Description
As of the Effective Date, the Company established the Reinhold Stock
Incentive Plan for key employees. The Reinhold Stock Incentive 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
Incentive 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 Incentive Plan may not
exceed 10,000. The shares to be delivered under the Reinhold Stock Incentive
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
Incentive 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 have been granted under the
Reinhold Stock Incentive Plan.
Grants to Employees Under the Reinhold Stock Incentive 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.
<PAGE>
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.
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 Incentive 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 Incentive Plan
provides that, except as provided below, in the event of a "Change in Control"
(as defined in the Reinhold Stock Incentive 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.
<PAGE>
INDEPENDENT AUDITORS
The Audit Committee of the Board of Directors of Reinhold selected KPMG
Peat Marwick LLP, independent auditors, to audit Reinhold's financial statements
for the year ended December 31, 1997. A representative of KPMG Peat Marwick LLP
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.
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 1999 Annual Meeting of
Stockholders must be received by Reinhold at its executive offices no later than
November 13, 1998. 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/BRETT R. MEINSEN
BRETT R. MEINSEN
Secretary
March 13, 1998
PLEASE DATE, SIGN AND IMMEDIATELY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
ADDRESSED ENVELOPE.
<PAGE>
APPENDIX A
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 Brett R. Meinsen 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 Friday, May 1, 1998 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
(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
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 Brett R. Meinsen 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 Friday, May 1, 1998 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 nominee 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 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.
