JPE, INC.
---------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held September 30, 1998
To the Shareholders:
You are cordially invited to attend the Annual Meeting of Shareholders of
JPE, Inc. (the "Company") to be held at the Sheraton Inn-Ann Arbor, 3200
Boardwalk, Ann Arbor, Michigan 48108, on Wednesday, September 30, 1998 at 9:00
a.m., local time, for the following purposes:
(1) To elect two directors of the Company to serve until the Annual
Meeting of Shareholders in 2001.
(2) To consider such other business as may properly come before the
Meeting.
Only shareholders of record at the close of business on August 5, 1998 will
be entitled to vote at the Meeting.
Your attention is called to the attached proxy statement and accompanying
proxy. It is important that your shares be represented and voted at the Annual
Meeting, regardless of whether you plan to attend in person. You are therefore
urged to sign, date and return the accompanying proxy card promptly in the
enclosed envelope. If you attend the Meeting, you may withdraw your proxy and
vote your own shares.
A copy of the Annual Report of the Company for the fiscal year ended
December 31, 1997 accompanies this Notice.
By Order of the Board of Directors
Donna L. Bacon, Secretary
Ann Arbor, Michigan
August 31, 1998
<PAGE>
JPE, INC.
775 Technology Drive
Suite 200
Ann Arbor, Michigan 48108
-------------------------
PROXY STATEMENT FOR THE ANNUAL MEETING OF SHAREHOLDERS
To Be Held September 30, 1998
GENERAL INFORMATION
The Annual Meeting of Shareholders of JPE, Inc. (the "Company") will be
held at the Sheraton Inn-Ann Arbor, 3200 Boardwalk, Ann Arbor, Michigan 48108,
on Wednesday, September 30, 1998, at 9:00 a.m., local time, for the purposes set
forth in the accompanying Notice of Annual Meeting of Shareholders. The
approximate mailing date for this proxy statement and the proxy is August 31,
1998.
It is important that your shares be represented at the Meeting. If you are
unable to attend the Meeting, please sign and date the enclosed proxy and return
it to the Company. The proxy is solicited by the Board of Directors of the
Company. Shares represented by valid proxies in the enclosed form will be voted
if received in time for the Annual Meeting.
Expenses in connection with the solicitation of proxies will be borne by
the Company and may include requests by mail and personal contact by its
directors, officers and employees. The Company will reimburse brokers or other
nominees for their expenses in forwarding proxy material to principals. Any
person giving a proxy has the power to revoke it at any time before it is voted.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Only holders of record of shares of the Company's Common Stock at the close
of business on August 5, 1998 are entitled to notice of, and to vote at, the
Meeting or any adjournment or adjournments thereof, each share having one vote.
On such record date, the Company had issued and outstanding 4,602,180 shares of
Common Stock.
Set forth below is information relating to the beneficial ownership of
outstanding shares of Common Stock by each person who is known to the Company to
be the beneficial owner of more than 5% of the outstanding shares of Common
Stock as of August 5, 1998:
<PAGE>
<TABLE>
<CAPTION>
Name and Address
of Beneficial Owner Shares Beneficially Owned
- ------------------- -------------------------
Indirectly through Percent
Number Shareholder Agreement of Class
------ --------------------- --------
<S> <C> <C> <C>
Dr. John Psarouthakis (1) 786,212 (2) 1,310,667 (3) 45.6%
775 Technology Drive, Suite 200
Ann Arbor, Michigan 48108
Dimensional Fund Advisors, Inc. 246,100 (4) 5.3%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
<FN>
(1) Chairman of the Board, Chief Executive Officer and a Director of the
Company.
(2) Consists of (a) 721,212 shares owned by a trust of which Dr. Psarouthakis
is trustee and a beneficiary and (b) 65,000 shares subject to stock options
exercisable within 60 days of August 5, 1998.
(3) Consists of (a) 40,000 shares held by a charitable foundation established
by Dr. Psarouthakis and (b) shares owned or subject to stock options
exercisable within 60 days of August 5, 1998 by persons who have granted
Dr. Psarouthakis the power to vote their shares until various dates in 2007
under a shareholder agreement.
(4) Based on information as of December 31, 1997 contained in Form 13G filed
with the Securities and Exchange Commission (the "Commission") by the
shareholder.
</FN>
</TABLE>
I. ELECTION OF DIRECTORS
The Board of Directors is divided into three classes serving staggered
three-year terms, with each class as nearly equal in number as possible. The
Board of Directors proposes that Dr. David E. Cole and Mr. John F. Daly be
elected as directors of the Company to hold office for a three-year term until
the Annual Meeting of Shareholders in 2001, or until their successors are
elected and qualified. The persons named in the accompanying proxy intend to
vote all valid proxies received by them for the election of the nominees named
above, unless such proxies are marked to the contrary. Withheld votes and broker
non-votes will not be deemed votes cast in determining the nominee vote, but
they will be counted for purposes of determining whether a quorum is present. In
case a nominee is unable or declines to serve, which is not anticipated, it is
intended that the proxies be voted in accordance with the best judgment of the
proxy holders.
The following information is furnished with respect to each nominee for
election as a director, each person whose term of office as a director will
continue after the Meeting and each executive officer of the Company.
<PAGE>
<TABLE>
<CAPTION>
Percent of
Total Shares of
Shares of Common Stock
Common Stock of the Company
Positions and Offices Beneficially Beneficially Term
with the Company and Owned as of Owned as of to
Name of Officer Age Other Principal Occupations August 5, 1998 August 5, 1998 Expire
- --------------- --- --------------------------- -------------- -------------- ------
NOMINEES FOR ELECTION AS DIRECTOR FOR A THREE-YEAR TERM
<S> <C> <C> <C> <C> <C>
David E. Cole (1) 60 Director of the Company; 3,000 * 1998
(May 1997) Director of Office for
the Study of Automotive
Transportation at
University of Michigan's
Transportation Research
Institute
John F. Daly (2) 75 Director of the Company; 26,200 * 1998
(May 1993) Retired Vice Chairman of
the Board of Directors of
Johnson Controls, Inc.
DIRECTORS CONTINUING IN OFFICE
John Psarouthakis (3) 66 Chairman of the Board, 2,096,879 45.6 2000
(December 1990) Chief Executive Officer
and Director of the
Company
Otto Gago (4) 63 Director of the Company; 37,462 * 2000
(May 1993) Thoracic and Cardiovascular
Surgeon
Donald R. Mandich (5) 72 Director of the Company; 26,200 * 1999
(May 1993) Retired Chairman and Chief
Executive Officer of Michigan
Mutual Insurance Company and
its subsidiaries
OTHER EXECUTIVE OFFICERS
Donna L. Bacon (6) 47 President, General Counsel 54,750 * --
and Secretary
James J. Fahrner (7) 47 Executive Vice President and 57,000 * --
Chief Financial Officer
All Directors and
Executive Officers
as a Group
(7 persons) (8) 2,301,491 50.0
<FN>
* Less than 1%.
(1) Consists of (a) 500 shares owned by Dr. Cole jointly with his wife and (b)
2,500 shares subject to stock options exercisable within 60 days of August
5, 1998.
(2) Consists of (a) 16,700 shares owned by Mr. Daly directly and (b) 9,500
shares subject to stock options exercisable within 60 days of August 5,
1998. Does not include 2,000 shares owned by a trust of which Mr. Daly's
wife is trustee and beneficiary.
(3) Consists of (a) 721,212 shares owned by a trust of which Dr. Psarouthakis
is trustee and a beneficiary, (b) 65,000 shares subject to stock options
exercisable within 60 days of August 5, 1998, and (c) 1,310,667 shares
owned or subject to stock options exercisable within 60 days of August 5,
1998 by persons who have granted Dr. Psarouthakis the power to vote their
shares until various dates in 2007 under a shareholder agreement.
(4) Consists of (a) 27,962 shares held in Dr. Gago's individual retirement
account and (b) 9,500 shares subject to stock options exercisable within 60
days of August 5, 1998. Dr. Psarouthakis has the power to vote the shares
held in Dr. Gago's individual retirement account under a shareholder
agreement. Does not include (a) 215,627 shares held by Dr. Gago's wife and
(b) 15,000 shares held by a charitable foundation established by Dr. and
Mrs. Gago, all of which Dr. Psarouthakis has the power to vote under a
shareholder agreement.
(5) Consists of (a) 16,700 shares owned by a trust of which Mr. Mandich is
trustee and beneficiary and (b) 9,500 shares subject to stock options
exercisable within 60 days of August 5, 1998.
(6) Consists of (a) 3,000 shares owned by Ms. Bacon directly and (b) 51,750
shares subject to stock options exercisable within 60 days of August 5,
1998.
(7) Consists of (a) 3,000 shares owned by a trust of which Mr. Fahrner is
trustee and a beneficiary and (b) 54,000 shares subject to stock options
exercisable within 60 days of August 5, 1998.
(8) Includes 201,750 shares subject to stock options exercisable within 60 days
of August 5, 1998 by the Company's directors and executive officers as a
group.
</FN>
</TABLE>
OTHER INFORMATION RELATING TO NOMINEES AND DIRECTORS
Following each director's name is a brief account of his business
experience during the past five years.
JOHN PSAROUTHAKIS
Dr. John Psarouthakis is the founder of the Company and has been Chairman
of the Board, Chief Executive Officer and a Director of the Company since it
began operations in late 1991. In 1978, Dr. Psarouthakis organized J. P.
Industries, Inc. ("JPI"), which became a Fortune 500 transportation components
manufacturing and distribution company, where he served as Chairman, President
and a Director until its sale in August, 1990. After the sale of JPI, Dr.
Psarouthakis was involved in various private investments and professional
activities until the Company began operations. Dr. Psarouthakis is currently an
Adjunct Professor teaching Acquisitions and Mergers at The University of
Michigan Graduate School of Business.
DAVID E. COLE
Dr. David E. Cole has been the Director of the Office for the Study of
Automotive Transportation (OSAT) at the University of Michigan's Transportation
Research Institute since 1978. He has worked extensively on internal combustion
engines, vehicle design, and overall automotive industry trends. Dr. Cole is a
director of the Automotive Hall of Fame and is on the Board of Trustees of Hope
College. Dr. Cole became a Director of the Company in May 1997.
JOHN F. DALY
Mr. John F. Daly was the Chairman of the Board of Directors and Chief
Executive Officer of Hoover Universal, Inc., a diversified manufacturer of
industrial engineered parts and components, from 1976 until his retirement in
1987. Mr. Daly also served as the Vice Chairman of the Board of Directors of
Johnson Controls, Inc., from May 1985 until his retirement in 1987. Mr. Daly is
a director of AAOMS-Educational Foundation, Comerica Bank & Trust, F.S.B.,
Edwards Brothers, Inc. and Handleman Company and is a trustee of Sienna Heights
College. Mr. Daly became a Director of the Company in May 1993.
OTTO GAGO
Dr. Otto Gago has been a thoracic and cardiovascular surgeon since 1967. He
currently practices in Ann Arbor, Michigan. Dr. Gago is also an investor in new
businesses and real estate ventures. Dr. Gago became a Director of the Company
in May 1993.
DONALD R. MANDICH
Mr. Donald R. Mandich served as Chairman and Chief Executive Officer of
Michigan Mutual Insurance Company and its subsidiaries from May 1995 through May
1996 and has served as a director of such company since May 1985. He was
Chairman of the Board and Chief Executive Officer of Comerica Bank from 1981
until his retirement in 1990. Mr. Mandich is a member of the Board and former
Chairman of the Heart and Vascular Institute of the Henry Ford Hospital. Mr.
Mandich became a Director of the Company in May 1993.
During the fiscal year ended December 31, 1997, the Board of Directors of
the Company held six meetings.
<PAGE>
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors has established an Audit Committee, a Compensation
Committee and an Executive Committee to assist it in the management of the
affairs of the Company.
The Company's Audit Committee held two meetings in the fiscal year ended
December 31, 1997. The Audit Committee is composed of Messrs. Daly, Gago and
Mandich and is responsible for the engagement of the Company's independent
accountants and reviews with them the scope and timing of their audit services
and any other services they may be asked to perform, their report on the
Company's accounts following completion of the audit and the Company's policies
and procedures relating to internal accounting and financial controls.
PricewaterhouseCoopers L.L.P. serves as independent auditors of the Company. The
Board of Directors has ratified the engagement of PricewaterhouseCoopers L.L.P.
for 1998.
The current members of the Company's Compensation Committee are Messrs.
Daly, Gago and Mandich. The Compensation Committee determines the compensation
payable and other benefits available to the Company's executive officers and to
some of the Company's other management. During the fiscal year ended December
31, 1997, the Compensation Committee held one meeting.
The current members of the Company's Executive Committee are Dr.
Psarouthakis and Messrs. Daly and Mandich. The Executive Committee held one
meeting during the fiscal year ended December 31, 1997.
The Board of Directors does not have a nominating committee, but from time
to time it may establish committees in addition to the Audit, Compensation and
Executive Committees to assist it in the discharge of its responsibilities.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
COMPENSATION OF DIRECTORS
Each director who is not also an officer or employee of the Company
receives a semi-annual director's fee of $3,000 and is reimbursed for expenses
of attending Board of Directors and committee meetings.
In addition, non-employee directors receive grants for stock options
pursuant to the JPE, Inc. Director Stock Option Plan (the "Director Plan"). Each
non-employee director of the Company who was a member of the Board on April 27,
1995, the date the Director Plan was adopted by the Board, was granted an option
to purchase 5,000 shares of Common Stock of the Company and each non-employee
director who is subsequently first elected or appointed to serve as a member of
the Board is automatically granted on the date of such election an option to
purchase 5,000 shares of Common Stock of the Company at an exercise price equal
to the fair market value of the Company's Common Stock on the date of such
grant. On the date of each annual meeting of shareholders subsequent to April
27, 1995, each non-employee director serving on or elected to the Board on such
date shall receive an option to purchase 3,000 shares of Common Stock of the
Company at an exercise price equal to the fair market value of the Company's
Common Stock on the date of such grant
SUMMARY COMPENSATION TABLE
The following table sets forth information for the fiscal years ended
December 31, 1995, 1996 and 1997 concerning compensation of the Company's Chief
Executive Officer and each of the Company's executive officers whose total
annual salary and bonus exceeded $100,000 in 1997:
<PAGE>
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
------------------- ------------
Fiscal Other Annual Stock Option All Other
Name and Position Year Salary (1) Bonus Compensation (2) Shares (#) Compensation (3)
- ----------------- ------ ---------- ----- ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
John Psarouthakis 1997 $250,008 -0- -- -0- $ 9,550
Chairman of the 1996 233,333 $50,000 -- 110,000 (4) 9,250
Board, Chief 1995 192,500 50,000 -- 90,000 4,500
Executive Officer
and Director
Donna L. Bacon 1997 165,988 -0- -- -0- 9,550
President, General 1996 152,500 40,000 -- 75,000 (5) 9,250
Counsel and Secretary 1995 146,625 35,000 -- 15,000 -0-
C. William Mercurio (6) 1997 97,475 -0- -- -0- 51,550 (7)
Former President-OEM 1996 167,760 50,000 -- 25,000 (4) 98,374 (8)
Group and Director
James J. Fahrner 1997 160,563 -0- -- -0- 9,550
Executive Vice 1996 153,125 40,000 -- 95,000 (9) 9,250
President and Chief 1995 78,542 20,000 -- 45,000 -0-
Financial Officer
<FN>
(1) Amounts represent the dollar value of base salary earned by the named
executive officer during the fiscal year covered as reported on the
officer's W-2.
(2) The dollar value of perquisites provided to each of the named executive
officers does not exceed the lesser of $50,000 or 10% of the total of
annual salary and bonus reported for the named executive officer.
(3) Represents the amount contributed to an account for the employee's benefit
by the Company under the Company's 401(k) Savings Plan, unless otherwise
indicated.
(4) Represents options granted as replacement options in connection with the
December 16, 1996 repricing of options. See "Ten-Year Option/SAR
Repricings" below.
(5) Includes options to purchase 15,000 shares of the Company's Common Stock
that were canceled in connection with the December 16, 1996 repricing of
options. See "Ten-Year Option/SAR Repricings" below.
(6) Mr. Mercurio resigned as President-OEM Group and Director of the Company
effective July 31, 1997.
(7) Represents $42,000 paid in consideration for a covenant not-to-compete and
$9,550 contributed to Mr. Mercurio's account under the Company's 401(k)
Savings Plan.
(8) Represents $72,000 paid in consideration for a covenant not-to-compete and
$26,374 contributed to Mr. Mercurio's account under the Plastic Trim Profit
Sharing Retirement Plan.
(9) Includes options to purchase 25,000 shares of the Company's Common Stock
that were canceled in connection with the December 16, 1996 repricing of
options. See "Ten-Year Option/SAR Repricings" below.
</FN>
</TABLE>
<PAGE>
AGGREGATED OPTION EXERCISES IN THE LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
The following table sets forth information concerning (i) each exercise of
stock options during the fiscal year ended December 31, 1997 by each named
executive officer of the Company and (ii) the value of unexercised stock options
held by such persons as of December 31, 1997:
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<CAPTION>
Value of
Unexercised
Number of In-the-Money
Unexercised Options Options at
Shares at December 31, 1997 December 31, 1997
Acquired Value Exercisable/ Exercisable/
Name on Exercise Realized Unexercisable Unexercisable (1)
- ---- ----------- -------- -------------------- -----------------
<S> <C> <C> <C> <C>
John Psarouthakis -- -- 65,000/45,000 0/0
Donna L. Bacon 2,000 750 31,750/26,250 0/0
C. William Mercurio -- -- 0/0 0/0
James J. Fahrner 1,000 562 27,750/41,250 0/0
<FN>
(1) In calculating the value of unexercised in-the-money options at December
31, 1997, the Company used a market value of $5.5625 per share, the closing
price for shares of Common Stock on the Nasdaq National Market on December
31, 1997.
</FN>
</TABLE>
TEN-YEAR OPTION/SAR REPRICINGS
On December 16, 1996, the Board of Directors of JPE, Inc. acknowledged the
effort that would be required from its key employees to implement changes at the
Company's operations and to effect a successful turnaround of Pebra Inc., that
was acquired on December 23, 1996. This Board of Directors determined that the
most effective and economical method to motivate and reward such employees would
be to reprice all outstanding options of then current, active employees.
Therefore, the Board of Directors approved an option exchange for then current,
active employees entitling such employees to cancel their outstanding options in
exchange for new options with an exercise price of $7.25 per share, the fair
market value of the Company's stock on the date of exchange. The new options
were subject to the same vesting schedule as the canceled options, including the
same vesting commencement date, with the same termination date; provided that if
the canceled option was an incentive stock option, it became a non-qualified
option.
JPE, Inc. Board of Directors
<PAGE>
<TABLE>
<CAPTION>
Number of Market Length of
Securities Price of Exercise Original
Underlying Stock at Price at Option Term
Options/ Time of Time of Remaining
SARs Repricing Repricing New at Date of
Repriced or or Exercise Repricing
Name Date or Amended Amendment Amendment Price or Amendment
---- ---- ---------- --------- --------- -------- ------------
<S> <C> <C> <C> <C> <C> <C>
John Psarouthakis 12/16/96 20,000 $7.25 $12.65 $7.25 1.92 years
23,678 7.25 11.55 7.25 3.92 years
66,322 7.25 10.50 7.25 8.92 years
C. William Mercurio 12/16/96 25,000 7.25 10.50 7.25 8.92 years
Donna L. Bacon 12/16/96 30,000 7.25 10.75 7.25 7.83 years
15,000 7.25 10.50 7.25 8.92 years
15,000 7.25 7.75 7.25 9.92 years
James J. Fahrner 12/16/96 30,000 7.25 14.00 7.25 8.58 years
15,000 7.25 10.50 7.25 8.92 years
15,000 7.25 9.875 7.25 9.67 years
10,000 7.25 7.75 7.25 9.92 years
</TABLE>
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
During 1993, Section 162(m) of the Internal Revenue Code was enacted to
limit the corporate deduction for compensation paid to each of the five most
highly compensated executive officers of a publicly-held corporation to $1
million per year, unless certain requirements are met. The Compensation
Committee has reviewed the impact of this legislation on the Company's executive
compensation plans and concluded that this legislation should not apply to limit
the deduction for executive compensation paid by the Company in 1997.
REPORT OF COMPENSATION COMMITTEE
The report of the Compensation Committee shall not be deemed incorporated
by reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent the Company specifically
incorporates this information by reference, and shall not be deemed filed under
such Acts.
INTRODUCTION AND ORGANIZATION
The Compensation Committee of the Board of Directors, composed of
non-employee directors, reviews and develops compensation programs for key
management, evaluates executive performance, administers the Company's
compensation programs and makes recommendations as to compensation matters to
the Board of Directors.
GENERAL POLICIES
The Compensation Committee's overall compensation policy with regard to
executive officers is to provide a compensation package that is intended to
attract and retain qualified executives and to provide incentives to achieve the
Company's goals and increase shareholder value. The Compensation Committee
implements this policy through base salaries, bonuses and grants of stock
options, stock appreciation rights and restricted stock.
BASE SALARIES
Base salary is determined for each of the Company's key executives by the
Compensation Committee based upon recommendations of the Company's Chief
Executive Officer. Factors affecting executive salary determinations include
experience, leadership, the Company's performance and achievements, individual
initiative, performance and achievements and an evaluation of the
responsibilities of the position held by the executive. No specific weighting of
factors is used.
BONUSES
The Company awards its executive officers discretionary bonuses deemed
appropriate by the Compensation Committee. Bonuses are intended to provide
incentives to achieve the Company's financial and operational goals and increase
shareholder value, as well as to recognize an executive's individual
contributions to the Company. Factors affecting executive bonus determinations
include an evaluation of the Company's results and the executive's initiative,
performance and achievements, and the executive's salary. The Compensation
Committee does not use any specific weighting of factors. The Compensation
Committee obtains recommendations from the Chief Executive Officer as to
executive officer bonuses based on an evaluation of each individual executive's
performance during the year.
LONG-TERM INCENTIVES
The Compensation Committee believes that executive ownership of the
Company's stock, together with compensation plans that foster the alignment of
management's interests with those of the Company's shareholders, are in the best
interests of shareholders and management. Under the Company's 1993 Stock
Incentive Plan, the Compensation Committee approved grants of stock options to
executive officers and to other key employees. Awards under the 1993 Stock
Incentive Plan are intended to provide participants with an increased incentive
to make significant contributions to the long-term performance and growth of the
Company, to join the interests of participants with the interests of
shareholders of the Company and to facilitate attracting and retaining key
employees of exceptional ability.
The Compensation Committee's policy is to award stock options in amounts
reflecting the participant's position and the ability to influence the Company's
overall performance. In determining the size of individual awards, the
Compensation Committee also considers the amounts of options outstanding and
previously granted both in the aggregate and with respect to the optionee, the
amount of shares remaining available for grant under the Company's stock
incentive plan, the amount of stock owned by the executive and the aggregate
amount of the current awards. Generally, the exercise price for stock options
will be at or above the fair market value of the underlying shares on the date
of the grant.
OTHER COMPENSATION
The Company has adopted certain employee benefit plans, including its
401(k) savings plan and health benefit plans, in which executive officers have
been permitted to participate. Benefits under these plans are not directly or
indirectly tied to the Company's performance.
CHIEF EXECUTIVE OFFICER COMPENSATION
The compensation of Dr. Psarouthakis is determined based upon the same
criteria as are used for other executive officers. Dr. Psarouthakis did not
participate in the approval of his own compensation, but he did participate in
the discussion of the Company's performance and he made recommendations
concerning the compensation of executives reporting to him.
By the Compensation Committee
John F. Daly
Otto Gago
Donald R. Mandich
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee was established in May 1993 and
consists of Messrs. Daly, Gago and Mandich, each of whom has been an director of
the Company since that date. None of these directors has ever been an officer or
employee of the Company or any of its subsidiaries.
STOCK PERFORMANCE GRAPH
The following table compares the cumulative return since October 1993 (the
date of the Company's initial public offering) on a hypothetical investment in
JPE, Inc. (JPEI), the Nasdaq National Market (U.S.) Index and other motor
vehicle equipment manufacturers and distributors. The stock price performance
shown on the graph is not necessarily indicative of future price performance.
<TABLE>
COMPARISON OF 38 MONTH CUMULATIVE TOTAL RETURN*
Among JPE, Inc., The Nasdaq Stock Market-US Index
and a Peer Group
<CAPTION>
10/27/93 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
JPE, Inc. 100.00 106.52 82.61 84.78 61.96 48.37
Peer Group 100.00 124.13 80.60 71.42 96.31 114.81
Nasdaq Stock Market - U.S. 100.00 100.18 97.93 138.49 170.34 209.03
<FN>
* $100 invested on 10/27/93 in stock or Index - including reinvestment of
dividends. Fiscal year ending December 31.
</FN>
</TABLE>
Assumes $100 invested on October 27, 1993 in JPE, Inc., Nasdaq National
Market (U.S.) Index and other motor vehicle equipment manufacturers and
distributors (APS Holding Corp., Excel Industries, Hahn Automotive Warehouse,
MascoTech, Inc., Simpson Industries, Inc., Standard Products Co., and Tower
Automotive), weighted for market capitalization.
Total return equals price appreciation plus dividends and assumes
reinvestment of dividends.
SECTION 16(A) BENEFICIAL OWNERSHIP COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 generally requires the
Company's Directors and Executive Officers and persons who own more than 10% of
a registered class of the Company's equity securities ("10% owners") to file
with the Securities and Exchange Commission and the Nasdaq Stock Market, Inc.
initial reports of ownership and reports of changes in ownership of common stock
of the Company. Directors, Executive Officers and 10% owners are required by
Securities and Exchange Commission regulation to furnish the Company with copies
of all Section 16(a) forms they file. To the Company's knowledge, based solely
on review of copies of such reports furnished to the Company and written
representations that no other reports were required to be filed during the 1997
fiscal year, all Section 16(a) filing requirements applicable to its Directors,
Executive Officers and 10% owners were met, except that Dr. Psarouthakis failed
to timely report a charitable contribution of 10,000 shares of the Company's
common stock that he made in July 1997. This transaction was reported in
December 1997.
II. OTHER MATTERS
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANT
PricewaterhouseCoopers L.L.P. is the independent public accountant for the
Company and its subsidiaries and has reported on the Company's consolidated
financial statements for the fiscal year ended December 31, 1997. The Company's
independent public accountant is appointed by the Company's Board of Directors
after receiving recommendations from the Audit Committee. PricewaterhouseCoopers
L.L.P. has been reappointed as independent public accountant for the Company for
fiscal year 1998.
Representatives from PricewaterhouseCoopers L.L.P. are expected to be
present at the Annual Meeting of Shareholders, will have the opportunity to make
a statement at the Meeting if they desire to do so and are expected to be
available to respond to appropriate questions.
OTHER PROPOSALS
Neither the Company nor the members of its Board of Directors intend to
bring before the Annual Meeting any matters other than those set forth in the
Notice of Annual Meeting, and they have no present knowledge that any other
matters will be presented for action at the Meeting by others. However, if any
other matters properly come before such Meeting, it is the intention of the
persons named in the enclosed form of proxy to vote in accordance with their
best judgment.
SHAREHOLDER PROPOSALS
Section 14a-8 of the Securities Exchange Act of 1934 contains the rules for
including a shareholder proposal in the Company's proxy statement and on the
related form of proxy. The deadline for submitting a shareholder proposal
pursuant to Rule 14a-8 for the Company's 1999 Annual Meeting scheduled for on or
about May 19, 1999, is December 20, 1998. Shareholder proposals outside the
process provided in Rule 14a-8 are not required to be included in the Company's
proxy statement and form of proxy, but must be received by the Company no later
than March 5, 1999 in order to be considered timely. All shareholder proposals
should be sent to the attention of the Company's Secretary.
FORM 10-K
The Company will provide, upon written request, any exhibit to the Form
10-K upon payment of $.05 per page, the reasonable expense of furnishing such
exhibits. Such requests should be sent to the attention of the Company's
Secretary, JPE, Inc. 775 Technology Drive, Suite 200, Ann Arbor, MI 48108.
By Order of the Board of Directors
Donna L. Bacon, Secretary
Dated: August 31, 1998
<PAGE>
JPE, INC.
ANNUAL MEETING OF SHAREHOLDERS
September 30, 1998
P The undersigned hereby appoints John Psarouthakis and Donna L. Bacon, and
R each of them, with full power of substitution, the proxies of the
O undersigned to vote the shares of the undersigned at the Annual Meeting of
X Shareholders of JPE, Inc. to be held September 30, 1998, and at any
Y adjournment thereof, on all matters properly coming before such meeting.
1. ELECTION OF DIRECTORS: (change of address)
David E. Cole -------------------------------------
John F. Daly -------------------------------------
(If you have written in the above
space, please mark the corresponding
box on the reverse side of this card.)
You are encouraged to specify your choices by marking the appropriate boxes, SEE
REVERSE SIDE, but you need not mark any boxes if you wish to vote in accordance
with the Board of Directors' recommendations. The Proxies cannot vote your
shares unless you sign and return this Card.
SEE REVERSE SIDE
<PAGE>
/X/ Please mark your votes THIS PROXY IS SOLICITED ON BEHALF OF THE
as in this sample. BOARD OF DIRECTORS AND, WHEN PROPERLY
EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED
SHAREHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE
NOMINEES FOR THE DIRECTORS NAMED HEREIN. IN
THEIR DISCRETION, THE PROXIES ARE AUTHORIZED
TO VOTE UPON SUCH OTHER BUSINESS AS MAY
PROPERLY COME BEFORE THE MEETING, INCLUDING
THE ELECTION OF ANY PERSON TO THE BOARD OF
DIRECTORS WHERE A NOMINEE NAMED IN THE PROXY
STATEMENT IS UNABLE TO SERVE OR, FOR GOOD
CAUSE, WILL NOT SERVE, AND WITH RESPECT TO
PROPOSALS FROM SHAREHOLDERS THAT WERE NOT
RECEIVED ON OR BEFORE AUGUST 17, 1998.
FOR WITHHELD NOMINEES:
1. Election of David E. Cole
Directors / / / / John F. Daly
For, except vote withheld from
the following nominee(s):
------------------------------
The undersigned acknowledges receipt of the Notice of Annual Meeting of
Shareholders and the Proxy Statement dated August 31, 1998 and ratifies all that
the proxies or any of them or their substitutes may lawfully do or cause to be
done by virtue hereof and revokes all former proxies.
SIGNATURE(S) DATE
---------------------- ------------- PLEASE MARK, SIGN, DATE
AND RETURN THIS PROXY
CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
NOTE:Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
