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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. ___________)
Filed by the Registrant /x/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/x/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
SL Industries, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/x/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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October 10, 1997
DEAR SHAREHOLDER:
You are cordially invited to attend the Annual Meeting of Shareholders
of SL INDUSTRIES, INC., on Friday, November 21, 1997, at 9:00 in the morning.
The meeting will be held in the Grand Salon at the Ramada Regency
Palace, Route 73 and Fellowship Road, Mt. Laurel, New Jersey. Prior to the
meeting, an 8:00 a.m. breakfast will be held in the Regency Ballroom.
We look forward to the attendance of our shareholders because it
provides us with an opportunity for hearing your views and for holding informal
discussions concerning the progress of SL INDUSTRIES, INC.
Your proxy is important to assure a quorum at the meeting.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE BE SURE THAT
THE ENCLOSED PROXY CARD IS PROPERLY COMPLETED, DATED, SIGNED AND RETURNED
WITHOUT DELAY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN
THE UNITED STATES.
Sincerely yours,
OWEN FARREN
President and Chief Executive Officer
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SL INDUSTRIES, INC.
Corporate Office: SUITE A-114, 520 FELLOWSHIP ROAD,
MT. LAUREL, NJ 08054
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE is hereby given that the Annual Meeting of Shareholders of SL
INDUSTRIES, INC., will be held at the Ramada Regency Palace, Route 73 and
Fellowship Road, Mt. Laurel, New Jersey, on Friday, November 21, 1997, at 9:00
in the morning for the following purposes:
1. To elect seven directors for the ensuing year;
2. To ratify the appointment of Arthur Andersen LLP, to serve as
the Company's independent auditors for the fiscal year 1998;
3. To consider an amendment to the Company's Certificate of
Incorporation to eliminate cumulative voting;
4. To consider a shareholder proposal as described in the
accompanying Proxy Statement; and
5. To transact such other business as may properly come before the
Annual Meeting and any adjournment thereof.
The Board of Directors has fixed the close of business on
September 23, 1997, as the record date for the determination of the shareholders
entitled to notice of and to vote at the Annual Meeting.
IT IS IMPORTANT THAT YOUR SHARES ARE REPRESENTED AT THE MEETING.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE BE SURE THAT THE
ENCLOSED PROXY CARD IS PROPERLY COMPLETED, DATED, SIGNED AND RETURNED WITHOUT
DELAY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE TIME IT IS
VOTED.
By Order of the Board of Directors
James E. Morris
Secretary
October 10, 1997
Mount Laurel, New Jersey
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SL INDUSTRIES, INC.
Suite A-114
520 Fellowship Road
Mount Laurel, NJ 08054
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
of proxies, by and on behalf of the Board of Directors of SL Industries, Inc.
(the "Company"), to be voted at the Annual Meeting of Shareholders on November
21, 1997, at 9:00 a.m., and at any adjournment thereof (the "Annual Meeting").
The Annual Meeting has been called to consider and vote upon the election of
seven Directors, the ratification of the appointment of Arthur Andersen LLP as
the Company's auditors for the fiscal year 1998, an amendment to the Company's
Certificate of Incorporation to eliminate cumulative voting, a shareholder
proposal as described in this Proxy Statement, and such other business as may
properly come before the meeting. The Company's By-Laws require written notice
60 calendar days in advance of the Annual Meeting to raise business at the
Annual Meeting, including the nomination of Directors. The complete text of such
By-Law provision was included as an Exhibit in the Company's October 31, 1996,
Form 10-Q. Any shareholder wishing an additional copy of such provision should
call the Secretary of the Company. This Proxy Statement and the enclosed form of
proxy are first being mailed to shareholders on or about October 10, 1997.
VOTING BY SHAREHOLDERS
Only holders of record of the Company's Common Stock, par value $.20
per share (the "Common Stock"), at the close of business on September 23, 1997,
are entitled to receive notice of and to vote at the Annual Meeting.
Shares cannot be voted at the Annual Meeting unless the owner thereof
is present in person or represented by proxy. When a proxy in the accompanying
form is returned, properly dated and executed, the shares represented thereby
will be voted at the Annual Meeting and, if a shareholder specifies a choice
with respect to any matter to be acted upon, such shares will be voted in
accordance with the specifications so made. A proxy may be revoked at any time
prior to being voted by filing a written notice of revocation with the Secretary
of the meeting or by voting the shares subject to the proxy by written ballot at
the meeting.
The proxy tabulation will be done by our transfer agent and proxies
should be returned in the enclosed business reply envelope. The cost of
soliciting proxies will be borne by the Company. In addition to solicitations by
mail, a number of directors, officers and other employees of the Company and of
its subsidiaries may (without additional compensation) solicit proxies in person
or by telephone, telex, facsimile or other electronic means. The Company has
also retained MacKenzie Partners, Inc., for a fee not-to-exceed $7,500, and
reimbursement of out-of-pocket expenses, to aid in the solicitation of proxies.
On the record date, September 23, 1997, there were 5,463,930 shares of
Common Stock of the Company outstanding. All outstanding shares are of one
class. Shareholders have the right to cast one vote for each share held on the
record date as to each matter presented at the meeting, except that there is
cumulative voting in the election of directors.
Cumulative voting means that each shareholder may cast a number of
votes equal to the number of his or her shares multiplied by the number of
directors to be elected (seven at this Annual Meeting) and that he or she may
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cast all of such votes for a single director or may distribute them among the
number to be elected or any two or more of them as he or she may see fit. If a
shareholder wishes to distribute his or her cumulative votes in a specific
manner, the proxy card should be marked to indicate clearly how the votes are to
be distributed among the nominees. For example, the shareholder may write on the
proxy card the number of votes to be cast next to the name of the Director or
Directors for whom the shareholder desires to cast such votes. Unless indicated
to the contrary, if a shareholder strikes out the name of a nominee all the
cumulative votes of such shareholder which were otherwise distributable among
all of the nominees will instead be distributed among the remaining nominees in
the discretion of the proxy holders named therein as described below, unless
otherwise indicated. For example, if a shareholder owns 10 shares and strikes
out the name of one of the seven nominees listed on the proxy card, all of such
shareholder's 70 cumulative votes will be distributed among the remaining six
nominees at the discretion of the proxy holders. The seven candidates receiving
the highest number of votes shall be elected.
All shares represented by each properly executed unrevoked proxy
received prior to the Annual Meeting will be voted in accordance with the
instructions specified therein, or in the absence of appropriate instructions,
for Proposals 1, 2 and 3, and against Proposal 4. With respect to the election
of directors, where no vote is specified or where a vote FOR proposal 1 is
marked, unless contrary instructions are set forth on the proxy card, the
cumulative votes represented by a proxy will be cast for all or fewer than all
of the nominees at the discretion of the proxy holders named therein in order to
elect as many nominees as believed possible under the then prevailing
circumstances. At the present time, the Board has not determined any specific
order in which it intends to distribute votes among its nominees.
Under the By-Laws of the Company, the presence of a quorum is required
for each matter to be acted upon at the Annual Meeting. The holder of a majority
of the shares entitled to vote at the meeting must be present in person or
represented by proxy in order to constitute a quorum for all matters to come
before the meeting. Broker non-votes and abstentions will be counted only for
the purpose of determining whether a quorum is present at the meeting. Except
for the election of directors, with respect to which there is cumulative voting
as more fully described above, and Proposal 3, relating to the elimination of
cumulative voting, with respect to which the approval of two-thirds of the votes
cast at the duly convened Annual Meeting is required, all matters to be voted
upon at the Annual Meeting must receive the approval of a majority of votes cast
at the duly convened Annual Meeting in order to be binding on the Company. For
purposes of determining the number of votes cast with respect to any voting
matter, only votes cast "for" or "against," in accordance with and subject to
Section 402.08 of the rules of the New York Stock Exchange (or any successor
provision), are included.
It Is Important That Your Shares Are Represented At The Meeting.
Whether Or Not You Expect To Attend The Meeting, Please Be Sure That
The Enclosed Proxy Card Is Properly Completed, Dated, Signed And Returned
Without Delay In The Enclosed Envelope, Which Requires No Postage If Mailed In
The United States.
The Board of Directors does not know of any business to properly come
before the Annual Meeting, other than that set forth in the Notice of Annual
Meeting of Shareholders. Should any matters properly come before the Annual
Meeting or any adjournment thereof, for which specific authority has not been
solicited from the shareholders, then, to the extent permissible by law, the
persons voting the proxies will use their discretionary authority to vote
thereon in accordance with their best judgment.
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The enclosed proxy confers discretionary authority to vote with respect
to any and all of the following matters that may come before the Annual Meeting:
(i) matters which the Company does not know, a reasonable time before the proxy
solicitation, are to be presented at the Annual Meeting; (ii) approval of the
minutes of a prior meeting of shareholders if such approval does not amount to
ratification of the action taken at that meeting; (iii) the election of any
person to any office for which a bona fide nominee is named in this Proxy
Statement and such nominee is unable to serve or, for good cause, will not
serve; (iv) any proposal omitted from this Proxy Statement and proxy pursuant to
Rule 14a-8 or Rule 14a-9 promulgated under the Securities Exchange Act of 1934;
and (v) matters incident to the conduct of the Annual Meeting. In connection
with such matters, the persons named in the enclosed proxy card will vote in
accordance with their best judgment.
SECURITY OWNERSHIP OF PRINCIPAL SHAREHOLDERS AND MANAGEMENT
The following table sets forth certain information regarding ownership
of the Company's Common Stock, as of September 23, 1997 (except as otherwise
noted) by: (i) each person or entity (including such person's or entity's
address) who is known by the Company to own beneficially more than five percent
of the Company's Common Stock, (ii) each of the Company's Directors and nominees
for Director who beneficially owns shares, (iii) each Named Executive Officer
(as defined under Executive Compensation) who beneficially owns shares, and (iv)
all executive officers and Directors as a group. The information presented in
the table is based upon the most recent filings with the Securities and Exchange
Commission by such persons or upon information otherwise provided by such
persons to the Company.
<TABLE>
<CAPTION>
Number of Shares
Name of Beneficial Owner Benefically Owned(1) Percentage Owned
------------------------ -------------------- ----------------
<S> <C> <C>
Dimensional Fund Advisors Inc. 425,800(2) 7.8%
1299 Ocean Avenue
11th Floor
Santa Monica, CA 90401
J. Dwane Baumgardner 37,176(3) *
Owen Farren 199,409(4) 3.4%
Edward A. Gaugler 180,540(5) 3.3%
George R. Hornig 24,540(6) *
Warren G. Lichtenstein 345,100(7) 6.3%
Salvatore J. Nuzzo 54,082(8) *
Robert J. Sanator 5,000 *
James E. Morris 32,315(9) *
All Directors and Executive Officers as a 891,662(10) 15.4%
Group
</TABLE>
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* Less than one percent (1%).
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. Under such rules, shares are deemed to be
beneficially owned by a person or entity if such person or entity has or shares
the power to vote or dispose of the shares, whether or not such person or entity
has any economic interest in such shares. Except as otherwise indicated, and
subject to community property laws where applicable, the persons and entities
named in the table above have sole voting and investment power with respect to
all shares of Common Stock shown as beneficially owned by them. Shares of Common
Stock subject to options or warrants currently exercisable or exercisable within
60 days are deemed outstanding for purposes of computing the percentage
ownership of the person or entity holding such option or warrant but are not
deemed outstanding for purposes of computing the percentage ownership of any
other person or entity.
(2) Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment
advisor, is deemed to have beneficial ownership of 425,800 shares, as of June
30, 1997, all of which shares are held in portfolios of DFA Investment
Dimensions Group Inc., a registered open-end investment company, or in series of
the DFA Investment Trust Company, a Delaware business trust, or the DFA Group
Trust and DFA Participation Group Trust, investment vehicles for qualified
employee benefit plans, all of which Dimensional serves as investment
manager. Dimensional disclaims beneficial ownership of all such shares.
(3) Includes 35,176 shares which Mr. Baumgardner has the right to acquire at any
time upon exercise of stock options.
(4) Includes 69 shares owned jointly by Mr. Farren and his wife, who share
voting and investment power, 6,200 shares held in an IRA for Mr. Farren, 18,640
shares beneficially owned as a participant in the Company's Savings and Pension
Plan, and 174,500 shares which Mr. Farren has the right to acquire, at any time,
upon the exercise of stock options.
(5) Such shares do not include 942 shares which are owned by Mr. Gaugler's wife,
as to which such director disclaims any beneficial ownership.
(6) Includes 20,540 shares which Mr. Hornig has the right to acquire at any time
upon exercise of stock options.
(7) Includes 329,300 shares which Steel Partners II, L.P., beneficially owns and
in which Mr. Lichtenstein, a current Director, has a beneficial interest.
(8) Includes 51,082 shares which Mr. Nuzzo has the right to acquire at any time
upon exercise of stock options.
(9) Includes 4,316 shares owned jointly by Mr. Morris and his wife, who share
voting and investment power, 2,374 shares beneficially owned as a participant in
the Company's Savings and Pension Plan, and 25,625 shares which Mr. Morris has
the right to acquire at any time upon exercise of stock options.
(10) Includes 320,423 shares which directors and executive officers have the
right to acquire, at any time, upon the exercise of nonqualified and incentive
stock options granted by the Company. Except for 333,685 shares, as to which
certain directors and executive officers share voting and investment power, the
directors and executive officers have sole voting and investment power as to the
shares beneficially owned by them.
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ELECTION OF DIRECTORS
At the Annual Meeting, seven persons will be elected to serve as the
Company's Board of Directors until the next Annual Meeting of Shareholders and
until their successors shall have been elected and qualified. Unless otherwise
directed, it is intended that shares represented by proxy will be voted by the
proxy holders in favor of the election of all the following persons, except that
the cumulative votes represented by proxies will be cast for all or fewer than
all of the nominees for director at the discretion of the proxy holders named
therein in order to elect as many nominees as possible under the circumstances
prevailing at the meeting. Discretionary authority to so cumulate votes is
hereby solicited. Each of the nominees has consented to be named as a nominee in
this Proxy Statement and to serve as a director, if elected. Each of the
nominees is at present a member of the Board of Directors of the Company. In the
event that any of the nominees for director should become unavailable to serve
as such, the proxies may be voted for such substitute or substitutes as may be
nominated by the Board of Directors of the Company.
The following table sets forth the name of each nominee for election to
the Board of Directors, his age, principal occupation and the name and principal
business of any corporation or organization in which such occupation is carried
on, and the period during which he has served as director.
<TABLE>
<CAPTION>
Served
Continuously As
Name Principal Occupation for Five Director
of Nominee Age Years and Directorships Since
- ---------- --- ----------------------------- ---------------
<S> <C> <C> <C>
J. Dwane (57) Chairman of Donnelly Corporation, Inc., a 1990
Baumgardner(1)(3)(4) manufacturing company in Holland, Michigan, since
1986 and Chief Executive Officer since 1982.
Owen Farren(1)(4) (46) President and Chief Executive Officer of the 1991
Company since April 1991; from May 1990 to April
1991, Executive Vice President of the Company.
Edward A. (78) An original founder of the Company, served as 1993
Gaugler(2) President from 1956 to 1960 and as director from
1956 to 1967; retired for more than five years.
George R. (43) Managing Director of Deutsche Morgan Grenfell, Inc. 1992
Hornig(3)(4) (investment bankers) since 1993; from 1991 to 1993,
President and COO of Dubin & Swieca Holdings, Inc.
(money managers).
</TABLE>
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<TABLE>
<CAPTION>
Served
Continuously As
Name Principal Occupation for Five Director
of Nominee Age Years and Directorships Since
- ---------- --- ----------------------------- ---------------
<S> <C> <C> <C>
Salvatore J. (66) Chairman of the Company since September 1993; 1988
Nuzzo(1)(2) Chairman and CEO of Datron, Inc., a manufacturing
company in Hartford, CT from May, 1996 to Present;
Director of Critchner Systems, Inc., March 1997
to present; Chairman and part owner of Marine
Mechanical Corporation from March 1994 to
present; Chairman of the Board of Technautics
Corporation, a manufacturing company in
Cleveland, Ohio, from April 1991 to March 1994;
and CEO from April 1991 to December 1992;
Director of Avnet Corporation, a distribution
company in New York, New York since September
1982.
Walter I. Rickard(2) (56) President and CEO of Listing Services Solutions, 1997
Inc. from October 1996 to present; President and
CEO, NYNEX, Entertainment and Information Services
Group, 1994 to 1996, and Corporate Vice President,
1992 to 1994.
Robert J. (67) Dean, College of Management Long Island University, 1993
Sanator(2)(3) from April 1991 to present.
(1) Member of the Executive Committee.
(2) Member of the Audit Committee.
(3) Member of the Compensation Committee.
(4) Member of the Nominating Committee.
</TABLE>
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THE BOARD OF DIRECTORS
The Company's Board of Directors has established the following standing
committees: the Executive Committee, the Audit Committee, the Nominating
Committee and the Compensation Committee. The Executive Committee, which met two
times during the fiscal year 1997, has and may exercise all the authority of the
Board, except that the committee cannot make, alter or repeal any By-law of the
Corporation, elect or appoint any director or remove any officer or director,
submit to shareholders any action that requires shareholder approval, or amend
or repeal any resolution previously adopted by the Board which by its terms is
amendable or repealable only by the Board. The Audit Committee, which met four
times during the fiscal year 1997, recommends the selection of independent
auditors, reviews the scope and results of the annual audit, is advised of and
reviews nonaudit services to be provided by the independent auditors, and
reviews reports of the independent auditors and of quarterly financial results.
The Nominating Committee, which met one time during the fiscal year 1997, was
constituted on July 14, 1992, to recommend the number and name of persons to be
elected by the shareholders as directors of the Company. At the present time
there is no procedure by which shareholders can recommend nominees to be
considered by the Nominating Committee. The Compensation Committee, which met
two times during the fiscal year 1997, recommends the compensation to be paid to
executive officers and the stock options to be granted to key employees under
the Company's 1991 Long Term Incentive Plan (see Compensation Committee Report),
as well as the amendments to be adopted for the Company's defined contribution
pension plans. The Board of Directors of the Company met seven times during the
fiscal year 1997. Each member of the Board attended at least seventy-five
percent of the meetings of the Board of Directors and Committees thereof, if a
member, except for Mr. Lichtenstein, who only attended fifty percent of the
Audit Committee meetings.
Non-employee directors are paid quarterly retainer fees of $3,500 (with
the exception of the Chairman, Mr. Nuzzo, whose quarterly fee is $5,250), $1,000
for each Board meeting attended, and $500 for each Committee meeting attended.
Mr. Farren does not receive director's retainer, Board meeting or Committee
meeting fees.
In fiscal year 1993, the Board of Directors adopted a Non-Employee
Director Non-Qualified Stock Option Plan (the "Directors' Plan"), which was
approved by the shareholders at the Company's 1993 Annual Meeting. Under the
Directors' Plan, non-employee Directors have the right annually to elect to
receive non-qualified stock options in lieu of all or a stated percentage of
retainer and/or attendance fees payable for the upcoming fiscal year. The number
of shares covered by such options is determined at the time such fees would
otherwise be payable, based upon the fair market value of the Company's Common
Stock at such times, except, with respect to an election to defer all such fees,
such determination shall be based upon 133% of fair market value at such times.
Elections are irrevocable. Under the Directors' Plan, Messrs. Baumgardner,
Hornig and Nuzzo elected for fiscal year 1997 to receive non-qualified stock
options in lieu of all such fees. In accordance with such elections, Mr. Nuzzo
was granted options to acquire 8,261 shares, Mr. Baumgardner was granted options
to acquire 6,131 shares, and Mr. Hornig was granted options to acquire 7,483
shares during fiscal year 1997. Messrs. Nuzzo, Baumgardner and Hornig have made
the same elections for fiscal year 1998. Mr. Rickard has also elected to receive
non-qualified stock options in lieu of all his fees effective, February 1, 1998.
A $50,000 life insurance policy is maintained on each director's life
for which the director designates the beneficiary. In addition, upon the
retirement of a director who has attained the age of sixty and has completed ten
years of service with the Board, the Company will pay $10,000 per year to the
retired director for life with a term certain of 10 years. Mr. Farren is
ineligible for these benefits. Most of these retirement payments are funded by
the purchase of a life insurance policy and provide both a death and retirement
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benefit, and the Company is both owner and beneficiary of the policy. If the
retired director dies after becoming eligible for retirement benefits and before
the guaranteed retirement payments have been made, the unpaid balance of the
benefits guaranteed will continue to be paid by the Company to the beneficiary
designated by him.
EXECUTIVE OFFICER COMPENSATION
The following table sets forth certain information regarding
compensation awarded to, earned by or paid to the Chief Executive Officer and
the Company's other executive officer whose total annual salary and bonus
exceeded $100,000 during fiscal 1997 (the "Named Executive Officers") for
services in all capacities during fiscal 1997, 1996, and 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
------------------------- ------------
Securities
Underlying All Other
Name and Salary Bonus Options/SARs Compensation
Principal Position Year ($) ($) (#) ($)(1)(2)
- ------------------ ---- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Owen Farren President 1997 218,810 100,000 17,000 26,530
& CEO 1996 187,100 81,250 16,000 26,721
1995 171,822(3) 60,000 10,000 26,671
James E. Morris 1997 91,350 35,500 4,500 4,656
Vice President/Corp. 1996 85,307 31,200 4,000 4,504
Controller/Treasurer & 1995 81,461 22,000 4,000 4,218
Secretary
</TABLE>
(1) Includes Company matching contributions and profit sharing contributions
made to the SL Industries, Inc., Savings and Pension Plan for Messrs. Farren and
Morris in fiscal year 1995 in the amounts of $5,446 and $3,554, respectively, in
fiscal year 1996, in the amounts of $5,461 and $3,801, respectively, and in
fiscal year 1997 in the amounts of $5,558 and $4,057, respectively. The
Company's contribution to the plan is based on a percentage of the participant's
elective contributions up to the maximum defined under the plan and a fixed
percentage, determined annually by the Board of Directors, of the participant's
total calendar year earnings. Under the plan, benefits are payable at retirement
as a lump sum or as an annuity.
(2) Includes premiums paid for group term life insurance for Messrs. Farren and
Morris and premiums paid for an ordinary whole life insurance policy on Mr.
Farren's life in the face amount of $1,000,000 of which he is the owner with the
right to designate beneficiaries.
(3) Mr. Farren elected to defer $3,960 of his fiscal year 1995 salary. The
amount earns interest at the rate of 8%, compounded annually, and is payable at
retirement. The deferred amount is funded by a life insurance policy where the
Company is both owner and beneficiary of the policy.
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Mr. Morris is scheduled to receive a $30,000 per year annuity, $24,000 of which
is fully vested, payable at age 65 for life with a term certain of 10 years.
This agreement is funded by the purchase of a life insurance policy and provides
both a death and retirement benefit, and the Company is both owner and
beneficiary of the policy. If the participant dies after becoming eligible for
retirement benefits and before the guaranteed retirement benefits have been
paid, the unpaid balance of the benefits guaranteed will continue to be paid by
the Company to the designated beneficiary.
Pursuant to a standing resolution of the Board of Directors, upon the
death of any executive officer, having more than five (5) years of service, the
Company will pay his spouse, over a 36-month period, an amount equal to the
officer's salary at his death.
Senior Executive Severance Plan
On May 1, 1991, the Company entered into a Severance Pay Agreement with
Mr. Farren, providing for payment equal to base annual salary or $135,000,
whichever is greater, and to continue for a limited time certain fringe benefits
in the event of involuntary termination of his employment, or voluntary
termination for "good reason." Good reason is defined to include (i) a demotion
in position, authority or similar action which would substantially alter the
officer's standing in the Company, (ii) a reduction in salary or failure to
increase compensation commensurate with other executive officers, (iii) a
relocation of the officer's place of employment, (iv) a change of control of the
Company, (v) incurring any serious illness or disability, or (vi) any other
circumstance as determined by the Board of Directors in good faith.
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STOCK OPTION GRANTS IN LAST FISCAL YEAR
Stock Options
The following table sets forth information concerning options to
purchase Common Stock granted under the Company's 1991 Long Term Incentive Plan
in fiscal year 1996 to the Named Executive Officers. Twenty five percent of the
options granted were exercisable on the date of grant with the balance
exercisable in twenty five percent increments, one, two, and three years after
the date of grant. The material terms of such options appear in the following
table.
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rates
of Stock Price
Price Appreciation for Option
Individual Grants Term (1)
- ---------------------------------------------------------------------------------- -----------------------------
% of Total
Number of Stock
Securities Options
Underlying Granted to
Stock Employees in
Options in Fiscal Exercise Expiration
Name Granted (#) Year Price($/SH) Date 5% ($) 10% ($)
---- ---------- ---- ----------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Owen
Farren .......... 17,000 13.2% 9.375 9/20/06 100,230 254,002
James E.
Morris .......... 4,500 3.5% 9.375 9/20/06 26,532 67,235
</TABLE>
(1) The Potential Realizable Value, determined in accordance with SEC rules,
assumes annualized market appreciation rates of 5% and 10%, respectively, from a
market value of $9.375/share on September 20, 1996 (the date of the grant) to
September 20, 2006 (the date of expiration of such options). These assumptions
are not intended to forecast future price appreciation of the Company's stock
price. The real value of the options in this table depends on the actual
performance of the Company's Common Stock during the applicable period, which
may increase or decrease in value over the time period set forth above. The
Potential Realizable Value does not assume future dividends, stock or cash. The
option grant does not accrue cash dividends unless the options are exercised,
should dividends be declared.
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AGGREGATED STOCK OPTION EXERCISES IN LAST
FISCAL YEAR AND FISCAL YEAR-END STOCK OPTION VALUES
The following table sets forth the aggregate options to purchase shares of
Common Stock of the Company held by the Named Executive Officers at July 31,
1997. No options were exercised during the fiscal year ended July 31, 1997.
<TABLE>
<CAPTION>
Number of Securities Underlying
Unexercised Options at Fiscal Value of Unexercised In-The-
Year End Money Options at Fiscal Year
# End ($)
--- -------
Name Exercisable/Nonexercisable Exercisable/Nonexercisable
---- -------------------------- --------------------------
<S> <C> <C>
Owen Farren ........ 165,250/12,750 963,419/11,156(1)
James E. Morris..... 23,125/3,375 135,484/2,953(1)
</TABLE>
(1) Based on the closing price of $10.25 at fiscal year end, less the respective
exercise prices.
The closing market price per common share on the New York Stock Exchange on
September 23, 1997, was $ 13.9375.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee members are J. Dwane Baumgardner (Chairman),
George R. Hornig and Robert J. Sanator, all of whom are non-employee directors
of the Company.
The following report and performance graft 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 that the Company
specifically incorporates this information by reference, and shall not otherwise
be deemed filed under such Acts.
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Compensation
Committee") is responsible for the establishment of the level and manner of
compensation of the Company's executive officers (including its named executive
officers). In addition, the Compensation Committee seeks to ensure that sound
compensation policies and practices exist and are being followed. The members of
the Compensation Committee are J. Dwane Baumgardner (Chairman), George R. Hornig
and Robert J. Sanator, all of whom are non-employee directors of the Company.
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The following describes the Compensation Committee's compensation policies
applicable to its executive officers (including its named executive officers),
including the relationship of corporate performance to executive compensation,
with respect to compensation reported for the last fiscal year.
The Compensation Committee believes that executive compensation should be
linked to value delivered to shareholders. The Company's compensation programs
have been designed to provide a correlation between the financial success of the
executive and the shareholders. Both long and short-term incentives are intended
to align the interests of executives and shareholders and to reward the
executive for building value within the Company.
The functions of the Compensation Committee are to oversee general
compensation policies for the Company's employees, to review and approve
compensation packages annually for the Company's executive officers and
subsidiary presidents, to approve cash incentive programs for all subsidiaries,
and to grant stock options to officers of the Company and other key employees as
appropriate. The Company seeks to provide executive compensation that will
support the achievement of the Company's financial goals, while attracting and
retaining talented executives and rewarding superior performance. In performing
this function, the Compensation Committee reviews executive compensation
surveys, the compensation levels of executive officers of companies in competing
businesses, and recommendations by management. The Compensation Committee may
also from time to time consult with independent compensation consultants and
others.
The Committee's current philosophy is to balance short-term performance of
executives with achievement of long-range strategic goals resulting in
continuously improving shareholder value, and to engender and preserve a sense
of fairness and equity among employees, shareholders, and customers. In keeping
with that philosophy, it has set the following objectives: (1) to link a
significant portion of annual compensation directly to operating performance;
(2) to promote achievement of the Company's long-term strategic goals and
objectives; (3) to align the interest of Company executives with long-term
shareholder interest; (4) to see that management aligns the interest of Company
employees with long-term shareholder interest; and (5) to attract, retain, and
motivate executives critical to the Company's long-term success.
The Company's executive compensation program consists of base salary,
annual cash bonus incentive, and stock options. (Along with all other employees,
executives also participate in one of the Company's defined contribution pension
plans.) Salary levels of executive officers are reviewed annually by the
Compensation Committee. Bonus payments are based on the achievement of the
Company performance targets and the achievement of individual performance goals.
Bonus amounts are calculated after fiscal year-end financial results become
available to the Compensation Committee and are determined in accordance with
guidelines established by the Compensation Committee. The Company seeks to
provide an overall level of compensation that is competitive with other
companies in competing businesses and in the Company's geographic markets.
Compensation in any particular case will vary on the basis of the Company's
annual and long-term performance as well as individual performance.
The Compensation Committee believes stock options and stock ownership
contribute to the aligning of the executive's interests with those of the
shareholders. The Company's 1991 Long Term Incentive Plan encourages stock
ownership by authorizing the grant of stock options to officers and key
employees of the Company. From time to time, the Compensation Committee provides
long term incentive compensation in the form of stock options where appropriate
as compensation for its executive officers. In determining whether individual
stock option grants will be made, the Compensation Committee evaluates each
participant's job responsibilities and performance during the last completed
fiscal year, as well as the perceived potential that the individual has in
contributing to the success of the Company.
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The salary for the Company's chief executive officer, Owen Farren, for
fiscal year 1997 was established by the Compensation Committee based, in large
part, on the performance of the Company during fiscal year 1996. Mr. Farren's
bonus for fiscal year 1997 was based on the performance of the Company during
fiscal 1997. Options were granted to Mr. Farren in September 1996 and September
1997 in large part to recognize his efforts in making significant progress
during the past two fiscal years toward the Board's directives to him of
controlling corporate overhead expenses, developing an overall plan for
reassessing the Company's strategic direction, and achieving financial and other
targets.
Respectfully submitted,
Compensation Committee:
J. Dwane Baumgardner, Chairman
George R. Hornig
Robert J. Sanator
PERFORMANCE GRAPH
The following Performance Graph summarizes the cumulative total shareholder
return on an investment of $100 on July 31, 1992 in the Company's Common Stock
for the period from that date to July 31, 1997, as compared to the cumulative
total return on a similar investment of $100 on that date in stocks comprising
the Russell 3000 Stock Index ("RUA") and the S&P Electrical Equipment Group
("S215"). The graph assumes the investment of all dividends.
[In the printed version of this document a graph appears here that depicts
the following plot points.]
JUL-97 324.722 221.024 299.465
JUN-97 308.882 205.343 299.465
MAY-97 268.182 197.391 300.750
APR-97 224.799 185.133 277.229
MAR-97 216.912 176.699 253.654
FEB-97 228.743 185.292 262.639
JAN-97 220.855 185.489 264.687
DEC-96 244.518 175.910 254.522
NOV-96 240.575 178.418 263.021
OCT-96 268.182 167.053 242.206
SEP-96 298.678 164.285 234.393
AUG-96 294.748 156.052 213.177
JUL-96 267.238 151.816 211.417
JUN-96 286.888 160.405 222.755
MAY-96 321.202 161.210 213.691
APR-96 242.860 157.549 204.790
MAR-96 231.109 154.789 203.605
FEB-96 246.777 153.531 196.977
JAN-96 219.358 151.636 200.647
DEC-95 227.192 147.589 188.115
NOV-95 242.860 145.412 177.490
Total return with dividends reinvested
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<PAGE>
OCT-95 249.728 139.591 165.455
SEP-95 222.414 141.021 166.452
AUG-95 218.512 135.984 156.718
JUL-95 179.492 135.149 156.983
JUN-95 159.982 130.087 152.724
MAY-95 151.292 126.720 153.372
APR-95 147.413 122.614 149.313
MAR-95 147.413 119.653 143.925
FEB-95 147.413 117.023 144.890
JAN-95 159.051 112.703 136.365
DEC-94 139.654 110.485 134.107
NOV-94 139.654 109.067 122.592
OCT-94 127.169 113.525 130.184
SEP-94 127.169 111.898 128.944
AUG-94 127.169 114.607 132.024
JUL-94 134.876 110.120 131.488
JUN-94 119.461 106.979 122.597
MAY-94 137.664 110.221 128.396
APR-94 118.544 109.382 123.307
MAR-94 114.720 108.266 127.696
FEB-94 114.720 113.500 134.477
Total return with dividends reinvested
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<PAGE>
JAN-94 118.5440 116.6370 135.437
DEC-93 114.7200 113.2910 132.606
NOV-93 118.5440 111.3150 124.127
OCT-93 121.4280 113.4250 123.835
SEP-93 125.2220 111.9320 123.378
AUG-93 110.0440 112.1710 126.740
JUL-93 110.0440 108.3250 125.396
JUN-93 106.2490 108.6100 123.424
MAY-93 120.3960 108.1660 120.972
APR-93 105.3460 105.4690 117.456
MAR-93 97.8215 108.4680 115.630
FEB-93 105.3460 106.0900 109.598
JAN-93 109.1090 105.7080 110.619
DEC-92 112.8710 104.7640 109.932
NOV-92 120.3960 103.1960 107.120
OCT-92 112.0310 99.4338 101.056
SEP-92 112.0310 98.5950 103.918
AUG-92 108.2960 97.4962 97.037
JUL-92 100.0000 100.0000 100.000
Total return with dividends reinvested
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CERTAIN TRANSACTIONS
On September 12, 1997, the Company purchased 375,500 shares of the
Company's Common Stock for a cash purchase price of $4,130,500, or $11.00 a
share, in a privately negotiated transaction with UM Investment Corporation. The
aggregate cost of the shares to UM Investment Corporation was $2,531,902. Prior
to the sale, UM Investment Corporation was the beneficial owner of more than
five percent of the Company's Common Stock.
APPOINTMENT OF INDEPENDENT AUDITORS
(Proposal 2)
The Board of Directors of the Company has appointed Arthur Andersen LLP,
certified public accountants, as the Company's independent auditors for the
fiscal year ending July 31, 1998, subject to ratification of such appointment by
shareholders. The submission of the appointment of Arthur Andersen LLP for
ratification by the shareholders is not required by law or by the Company's
Bylaws and is being done for the sole purpose of ascertaining the views of the
shareholders of the Company with respect to such appointment. The Company shall
not be bound by such shareholder action if the shareholders do not ratify the
appointment, in which event the selection of other independent certified public
accountants may be considered by the Board of Directors. Representatives of
Arthur Andersen LLP are expected to be present at the Meeting, will be given an
opportunity to make a statement if they desire to do so, and will be available
to answer appropriate questions from shareholders.
AMENDMENT TO CERTIFICATE OF INCORPORATION
TO ELIMINATE CUMULATIVE VOTING
(Proposal 3)
Under New Jersey law, shareholders of a corporation do not have cumulative
voting rights unless specifically provided in a corporation's certificate of
incorporation. On September 29, 1997, the Board of Directors adopted an
amendment (the "Amendment") to the Company's Certificate of Incorporation, as
amended, to eliminate the cumulative voting provision presently contained
therein and directed that the Amendment be submitted for consideration by
shareholders at the Annual Meeting. The sole dissenting vote to the Board's
action was cast by Warren G. Lichtenstein, who stated that he believes that
cumulative voting protects shareholder rights.
Pursuant to the cumulative voting provision of the Company's Certificate of
Incorporation, the holders of the Company's shares of Common Stock are presently
permitted to cumulate their votes in the election of directors of the Company.
Each holder is entitled to cast, for every share held, a number of votes equal
to the number of directors to be elected. Each such holder may cast such whole
number of votes for one nominee, or distribute such whole number of votes among
two or more nominees in any manner. See, VOTING BY SHAREHOLDERS. The Amendment
eliminates the cumulative voting right of shareholders.
One of the principal effects of cumulative voting is to make it more likely
that an individual or group of individuals who own less than a plurality of the
voting stock would be able to obtain representation on a board of directors.
Such an individual or group may have interests and goals which are not
consistent with and might be in conflict with those of a majority of
shareholders. The Company's Board of Directors believes that each director
should represent the interests of all shareholders, rather than the interests of
any special constituency. The Board of Directors believes that the Company
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should have a strong management team with a shared vision and strategy aligned
with that of a majority of its shareholders for the future of the Company. The
presence on the Board of one or more directors representing any special
constituency could disrupt and impair the efficient management of the Company.
To the extent that the Amendment would be deemed to discourage groups of
shareholders from attempting to capture seats on the Board of Directors, it
could be deemed to impede the ability of shareholders to implement changes to
the governance and management of the Company, whether or not such changes would
be beneficial to shareholders generally.
The Company's Certificate of Incorporation and By-Laws contain certain
provisions which have or may be viewed as having certain anti-takeover effects.
(1) The Company's Certificate of Incorporation contains a fair price provision
which requires the affirmative vote of the holders of 75% of the Company's
outstanding Common Stock to approve certain mergers, asset sales and other
transactions ("Business Combinations") involving the Company or a subsidiary of
the Company and a 10% or greater shareholder of the Company ("Interested
Shareholder") or certain affiliates of an Interested Shareholder, unless a
majority of Disinterested Directors (as defined therein) approves the
transaction or the transaction complies with the "fair price" provision. If a
Business Combination is approved by a majority of the Disinterested Directors or
meets the required "fair price" provisions, it must be approved by two-thirds of
the votes cast unless the transaction has been approved by two-thirds of the
directors, in which case the transaction must be approved by only a majority of
votes cast. (2) The Company's Certificate of Incorporation provides for the
issuance of six million shares of "blank check" preferred stock, none of which
are outstanding. The authorization of "blank check" preferred stock permits the
Company's directors to designate the rights, preferences, and limitations of
such preferred stock in one or more series without shareholder approval. (3) The
Company's By-Laws contain a sixty-day advance notice requirement for the
submission of shareholder proposals, including the nominations to the Board of
Directors.
The Board has no present intention of proposing additional amendments to
the Certificate of Incorporation or the By-Laws that would affect the ability of
a third party to effect a change in control of the Company. The Amendment is not
being recommended in response to any specific effort of which the Company is
aware to accumulate the Company's Common Stock or to obtain control of the
Company or its Board of Directors by means of a solicitation in opposition to
management or otherwise. In addition the Board's recommendation of the Amendment
is not part of a plan by management to adopt a series of such amendments.
The Company's entire Board of Directors is elected annually and the
Company's shareholders are given the opportunity to replace any and all of the
directors if they are not satisfied with the Company's performance. A majority
of companies whose shares are publicly traded do not have cumulative voting for
the election of directors.
The Board is proposing the Amendment at this time because it believes it is
in the best interests of the shareholders of the Company for the reasons stated
above.
The Board recommends a vote FOR this proposal.
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SHAREHOLDER PROPOSAL
(Proposal 4)
Ted D. Taubeneck, 3602 Chadbury Road, Mount Laurel, NJ 08054, who is the
owner of 18,866 shares of the Company's Common Stock, has advised the Company
that it is his intention to present the following resolution for consideration
and action by the shareholders at the 1997 Annual Meeting:
"RESOLVED, that the shareholders recommend and request the Directors of the
Corporation immediately consider the Corporation's strategic options,
including selling--or spinning off to the shareholders--all of its
businesses, which I believe are quite distinct, and report to the
shareholders well before the next annual meeting the facts and factors they
have considered, their analysis, their conclusions and recommendations, and
an indication of how they can be accomplished."
Supporting Statement of the Proponent:
"1. The principal function of a Board of Directors is to consider
strategic options, and decide which one or ones to pursue. The Corporation
has accomplished just two acquisitions and three divestitures in the last
five years, and there is no discernible evidence that SL's Board has
considered strategic options in recent years, so it should do so
immediately.
2. The Corporation has completely missed the Bull Market of the
past two years.
SL has become what Wall Street calls an "orphan"--that is, SL has
no following, very little float, a small capitalization, and no
identity. This is primarily because it is, in my opinion, a
"mini-conglomerate," a small group of diverse businesses, with no
single focus that today's market, or its thousands of analysts, can
easily grasp and which therefore suffers what I would call a
"conglomerate discount" that suppresses its price.
I believe that SL is made up of five quite distinct, dissimilar
businesses: power creation (MTI), power supply and distribution
(Teal and Condor), industrial power protection (Waber's more
profitable side), consumer power protection (Waber's less profitable
side) and power consumption (chrome plating).
There is a "way out" that is classical and that hundreds of
corporations in the U.S. have used in the past 15 years--spin off
all the dissimilar businesses.
Standing alone, which each could well do, each of the five would
be understandable to investors, brokers and analysts, and worth far
more in the aggregate than SL's current stock price. SL has just sold
its Auburn business, which represented only about 10% of SL's total
operating profit, for $12 million. But that implicit value will never
be realized so long as the businesses are bundled together in what I
would call a "mini-conglomerate," and adding more dissimilar
businesses would just make what I view as a "conglomerate discount"
worse.
3. The Board's "duty of care" means that it should collect and
examine all the relevant facts and factors in considering strategic
options, analyze those facts and factors, and come to reasoned
conclusions. For the shareholders to be assured that this has taken
place, promptly and properly and independently, the Board should
report all of this to the shareholders, at the earliest possible time.
4. I own 18,866 shares of SL, and am keenly interested in seeing
their underlying value realized, in the near future. I urge all other
shareholders with a similar interest to join with me in voting for
this Resolution."
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Statement of the Company in Opposition to Shareholder Proposal
The Board recommends a vote against this Proposal for the following
reasons:
The Board of Directors is committed to maximizing shareholder value and has
set a strategy that it believes will provide the best opportunity to grow the
value of SL Industries' stock in the long-run. In the course of its
deliberations, the Board regularly reevaluates and refines its corporate
strategy. As a result, the Company has undertaken several important initiatives
in the past five years, including three divestitures and two acquisitions. With
the sale of its SL Auburn subsidiary this year, the Company has substantially
completed its goal of consolidating its efforts and resources in the Power and
Data Quality Industry. The Board believes that the highest value for the
Company's shares will be accomplished by continuing to direct the Company's
efforts to become a leader in the production of power and data quality products.
Throughout this year, the Company's management communicates with
shareholders, interested investors, stock market analysts and others about the
Company's goals, strategies, business, financial conditions, and, as
appropriate, prospects. In addition, management reports to shareholders at the
Company's annual meeting and is available throughout the year to answer
questions.
Accordingly, the Board recommends a vote AGAINST this Proposal.
SUBMISSION OF SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any shareholder who, in accordance with and subject to the provisions of
the proxy rules of the Securities and Exchange Commission, wishes to submit a
proposal for inclusion in the Corporation's Proxy Statement for its 1998 Annual
Meeting of Shareholders must deliver such proposal in writing to the Secretary
of the Corporation at the Corporation's principal executive offices at Suite
A-114, 520 Fellowship Road, Mount Laurel, New Jersey 08054, no later than June
12, 1998.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
described in this proxy statement that will be presented for action at the
meeting. If other matters properly come before the meeting, the persons named as
proxies intend to vote the shares they represent in accordance with their
judgment.
The Annual Report of the Company for its fiscal year ended July 31, 1997,
was mailed on October 10, 1997, to all shareholders of record. Copies of the
Company's Form 10-K Report for that year, as filed with the Securities and
Exchange Commission, will be available without charge to shareholders by
writing: James E. Morris, Secretary, SL Industries, Inc., Suite A-114, 520
Fellowship Road, Mount Laurel, New Jersey 08054.
By Order of the Board of Directors
James E. Morris
Secretary
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SL INDUSTRIES, INC.
This Proxy is Solicited on Behalf of the Board of Directors of SL
Industries, Inc. For the Annual Meeting of Shareholders, to Be Held
November 21, 1997
The undersigned shareholder of SL Industries, Inc., a New Jersey
corporation, does hereby constitute and appoint J. Dwane Baumgardner and Edward
A. Gaugler, and each of them, attorneys-in-fact and agents with full powers of
substitution, for and in the name, place and stead of the undersigned, to vote
as specified below all of the common shares of the Company which the undersigned
is entitled to vote at the Annual Meeting of Shareholders of the Company to be
held at the Ramada Regency Palace, Route 73 and Fellowship Road, Mount Laurel,
New Jersey, on November 21, 1997, at 9:00 in the morning, and at any
adjournment thereof. This proxy revokes all prior proxies given by the
undersigned.
This proxy, when properly executed, will be voted in the manner
directed below. With respect to the election of directors, where no vote is
specified or where a vote FOR Proposal (1) is marked, the cumulative votes
represented by a proxy will be cast, unless contrary instructions are given, at
the discretion of the proxies named herein in order to elect as many nominees as
believed possible under the then prevailing circumstances. Unless indicated to
the contrary, if you strike out the name of a nominee, all your cumulative votes
will be distributed among the remaining nominees at the discretion of the
proxies. Where no vote is specified, this proxy will be voted FOR management
Proposals (2) and (3), and AGAINST Proposal (4), as recommended by the Board of
Directors. The individuals named above are authorized to vote in their
discretion on any other matters that properly come before the meeting.
(Continued and to be signed on the other side)
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(Continued from other side)
The Board of Directors recommends a vote FOR Proposals 1, 2 and 3.
(1) Election of Directors Nominees: J. Dwane Baumgardner; Owen Farren; Edward A.
Gaugler; George R. Hornig; Salvatore J. Nuzzo; Walter I. Rickard, Robert J.
Sanator.
/ / FOR the election as directors for the ensuing year of all or any nominees
listed above (except as stricken out above) (To withhold authority to vote for
any specific nominees, check the foregoing box and strike out or line through
such nominee's name on the list above.)
/ / WITHHOLD AUTHORITY to vote for all nominees listed above.
(2) Ratification of Appointment of Arthur Andersen LLP as Auditors for the
Fiscal Year 1998
/ / FOR / / AGAINST / / ABSTAIN
(3) Amendment to the Company's Certificate of Incorporation Eliminating
Cumulative Voting.
/ / FOR / / AGAINST / / ABSTAIN
(4) Shareholder Proposal.
The Board of Directors recommends a vote AGAINST Proposal 4.
/ / FOR / / AGAINST / / ABSTAIN
(5) Upon all other matters properly coming before the meeting and any
adjournment thereof.
Dated: ......................................., 1997
Signature: .........................................
Signature: .........................................
Title: .............................................
Please sign exactly as your name appears hereon. Executors, administrators or
trustees should indicate their capacities. If stock is held in joint names, both
registered holders should sign. This proxy shall vote all shares held in all
capacities to which the signatory is entitled.
<PAGE>
