<PAGE> 1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE COMMISSION
ONLY (AS PERMITTED BY RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
THE TIMKEN COMPANY
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------
(2) Aggregate number of securities to which transaction applies:
----------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
-------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------
(3) Filing Party:
---------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
TIMKEN
- ----------------------------------------------------------------------------
NOTICE OF
1997
Annual Meeting of
Shareholders
and
Proxy Statement
- ----------------------------------------------------------------------------
THE TIMKEN COMPANY
Canton, Ohio, U.S.A.
- ----------------------------------------------------------------------------
<PAGE> 3
TABLE OF CONTENTS
Page
----
Chairman's Letter...................................................... 1
Notice of Annual Meeting............................................... 3
Proxy Statement........................................................ 4
Election of Directors................................................. 4
Election of Class III Directors (Item No. 1)........................ 5
Information Concerning Nominees and Continuing Directors............ 5
Beneficial Stock Ownership.......................................... 8
Section 16(a) Beneficial Ownership Reporting Compliance............. 9
Executive Compensation.............................................. 10
Shareholder Proposal (Item No. 2)...................................... 20
Auditors............................................................... 22
General................................................................ 22
<PAGE> 4
[LOGO - TIMKEN]
- --------------------------------------------------------------------------------
W.R. Timken, Jr. WORLDWIDE LEADER IN BEARINGS AND STEEL
Chairman - Board of Directors
March 5, 1997
Dear Shareholder:
The 1997 Annual Meeting of The Timken Company will be held on Tuesday, April 15,
1997, at ten o'clock in the morning at the Corporate Office of the Company in
Canton, Ohio.
This year, you are being asked to act upon one matter recommended by your Board
of Directors, and, if brought before the meeting, a shareholder proposal
sponsored by two shareholders. Details of these matters are contained in the
accompanying Notice of Annual Meeting and Proxy Statement.
Please read the enclosed information carefully before completing and returning
the enclosed proxy card. Returning your proxy card as soon as possible will
assure your representation at the meeting, whether or not you plan to attend.
I appreciate the strong support of our shareholders over the years and look
forward to a similar vote of support at the 1997 Annual Meeting.
Sincerely,
/s/ W.R. Timken, Jr.
- ------------------------------
W.R. Timken, Jr.
Enclosure
<PAGE> 5
THE TIMKEN COMPANY
CANTON, OHIO
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors to serve in Class III for a term of three
years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21, 1997,
are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD, WHETHER OR NOT YOU EXPECT
TO ATTEND THE MEETING. For your convenience, a self addressed envelope is
enclosed requiring no postage if mailed in the United States.
LARRY R. BROWN
Vice President and General Counsel
March 5, 1997
YOUR VOTE IS IMPORTANT. PLEASE RETURN YOUR PROXY CARD.
-3-
<PAGE> 6
THE TIMKEN COMPANY
--------------------
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors in connection with
the Annual Meeting of Shareholders to be held April 15, 1997, for the purpose of
considering and acting upon the matters specified in the foregoing Notice.
Financial and other reports will be submitted to the meeting, but it is not
intended that any action will be taken on these reports. The Board of Directors
is not aware that matters other than those specified in the foregoing Notice
will be brought before the meeting for action. However, if any such matters
should be brought before the meeting, the persons appointed as proxies may vote
or act upon such matters according to their judgment.
MAILING ADDRESS; MAILING AND NOTIFICATION DATES
The mailing address of the corporate offices of the Company is 1835 Dueber
Avenue, S.W., Canton, Ohio 44706-2798. The approximate date on which this Proxy
Statement and form of proxy will be first sent or given to shareholders is March
7, 1997. In the event that proxy soliciting material for the 1998 Annual Meeting
is sent to shareholders on approximately the same date in 1998, the Company must
be notified no later than November 7, 1997, of any shareholder proposals to be
presented at the 1998 Annual Meeting, if such proposals are to be set forth in
the 1998 proxy soliciting material.
ELECTION OF DIRECTORS
The Company presently has twelve Directors who, pursuant to the Amended
Regulations of the Company, are divided into three classes with four Directors
in each Class. At the 1997 Annual Meeting, four Directors will be elected to
serve in Class III for a three year term to expire at the 2000 Annual Meeting.
Under Ohio law and the Company's Amended Regulations, candidates for Directors
receiving the greatest number of votes shall be elected.
If any nominee becomes unable, for any reason, to serve as a Director, or
should a vacancy occur before the election (which events are not anticipated),
the Directors then in office may substitute another person as a nominee or may
reduce the number of nominees to such extent as they shall deem advisable.
ITEM NO. 1
----------
ELECTION OF CLASS III DIRECTORS
The Board of Directors, by resolution at its February 7, 1997 meeting,
nominated the four individuals set forth below to be elected Directors in Class
III at the 1997 Annual Meeting to serve for a term of three years expiring at
the Annual Meeting in 2000 (or until their respective successors are elected and
qualified). All of the nominees have been previously elected as a Director by
the shareholders. Each of the nominees listed below has consented to serve as a
Director if elected.
Unless otherwise indicated on any proxy, the persons named as proxies on the
enclosed proxy form intend to vote the shares the form represents for the
election of the nominees named below.
-4-
<PAGE> 7
The following table, based in part on information received from the
respective nominees and in part from the records of the Company, sets forth
information regarding each nominee as of January 23, 1997.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE FOR LAST FIVE YEARS; CONTINUOUSLY
NAME OF NOMINEE DIRECTORSHIPS OF PUBLICLY HELD COMPANIES SINCE
- --------------- ---------------------------------------- ------------
<S> <C> <C>
Stanley C. Gault 71, Retired Chairman of the Board of The 1988
Goodyear Tire and Rubber Company, manufacturer
and distributor of tires, chemicals, polymers,
plastic film and other rubber products.
Previous positions: Chairman of the Board
and Chief Executive Officer of The
Goodyear Tire and Rubber Company;
Chairman of the Board and Chief Executive
Officer of Rubbermaid Incorporated,
manufacturer and distributor of rubber and
plastic products for consumer and institutional
markets.
Director of: Avon Products, Inc.;
International Paper Company;
Wal-Mart Stores, Inc.
John M. Timken, Jr. 45, Private Investor. 1986
W. R. Timken, Jr. 58, Chairman - Board of Directors. 1965
Director of: Diebold, Incorporated;
The Louisiana Land & Exploration
Company; TRINOVA Corporation.
Alton W. Whitehouse 69, Retired Chairman and Chief 1986
Executive Officer of The Standard
Oil Company, principally producer
of domestic oil and natural gas.
Director of: Cleveland Cliffs, Inc.
</TABLE>
-5-
<PAGE> 8
<TABLE>
CONTINUING DIRECTORS
The remaining eight Directors, named below, will continue to serve in their
respective classes until their term expires. The following table, based in part
on information received from the respective Directors and in part from the
records of the Company, sets forth information regarding each continuing
Director as of January 23, 1997.
<CAPTION>
AGE; PRINCIPAL POSITION OR OFFICE; DIRECTOR
BUSINESS EXPERIENCE FOR LAST FIVE YEARS; TERM CONTINUOUSLY
NAME OF DIRECTOR DIRECTORSHIPS OF PUBLICLY HELD COMPANIES EXPIRES SINCE
- ---------------- ---------------------------------------- ------- -----------
<S> <C> <C> <C>
Robert Anderson 76, Chairman Emeritus and Former Chairman April, 1998 1988
of the Board and Chief Executive Officer of
Rockwell International Corporation, a
multi-industry company applying advanced
technology to a wide range of products in its
automation, avionics and communications,
semiconductor systems and automotive businesses.
Director of: Optical Data Systems, Inc.;
Gulfstream Aerospace Corporation.
J. Clayburn La Force, Jr. 68, Dean Emeritus and Professor Emeritus, April, 1999 1994
The John E. Anderson Graduate
School of Management, University
of California, Los Angeles.
Previous positions: Acting Dean,
Hong Kong University of Science
and Technology;
Dean, John E. Anderson Graduate School
of Management.
Director of: Eli Lilly and Company;
Rockwell International Corporation;
Jacobs Engineering Group, Inc.;
The BlackRock Funds; Imperial Credit
Industries, Inc.; Payden & Rygel
Investment Trust; Provident Investment
Counsel Mutual Funds.
Robert W. Mahoney 60, Chairman of the Board and April, 1999 1992
Chief Executive Officer of Diebold,
Incorporated, a company specializing in the
automation of self-service transactions,
security products, software and service for
its products.
Previous position: President and Chief
Executive Officer of Diebold, Incorporated.
Director of: Diebold, Incorporated; Sherwin-
Williams Co.
Jay A. Precourt 59, Vice Chairman, President and Chief April, 1999 1996
Executive Officer of Tejas Gas
Corporation, intrastate gatherer,
transporter and marketer of natural gas.
Director of: Tejas Gas Corporation;
Dresser Industries, Inc.; Founders Funds, Inc.
</TABLE>
-6-
<PAGE> 9
<TABLE>
<CAPTION>
AGE; PRINCIPAL POSITION OR OFFICE; DIRECTOR
BUSINESS EXPERIENCE FOR LAST FIVE YEARS; TERM CONTINUOUSLY
NAME OF DIRECTOR DIRECTORSHIPS OF PUBLICLY HELD COMPANIES EXPIRES SINCE
- ---------------- ---------------------------------------- ------- ------------
<S> <C> <C> <C>
Ward J. Timken 54, Vice President. April, 1998 1971
Previous position: Director - Human
Resource Development.
Joseph F. Toot, Jr. 61, President and Chief Executive Officer. April, 1999 1968
Previous position: President.
Director of: Rockwell International
Corporation.
Martin D. Walker 64, Chairman of M. A. Hanna Company, April, 1998 1995
an international specialty chemicals
company, whose primary businesses
are plastics and rubber compounding,
color and additive concentrates and
distribution of plastic resins and
engineered shapes.
Previous position: Chairman and
Chief Executive Officer of M.A. Hanna
Company.
Director of: M. A. Hanna Company;
Comerica Inc.; The Reynolds and
Reynolds Company; Textron Inc.
Charles H. West 62, Retired Executive Vice President and April, 1998 1984
President - Steel of The Timken Company.
Previous position: Executive Vice
President - Steel of The Timken Company.
</TABLE>
W. R. Timken, Jr. and Ward J. Timken are brothers and are cousins of John M.
Timken, Jr. The Board of Directors has an Audit Committee and a Compensation
Committee; it does not have a Nominating Committee since the Board as a whole
performs that function. Messrs. J. Clayburn La Force, Jr., Robert W. Mahoney
(Chairman), Jay A. Precourt and John M. Timken, Jr. are the members of the
Audit Committee, which generally monitors the audit of the Company's financial
statements conducted by the auditors of the Company. Messrs. Robert Anderson,
Stanley C. Gault, Martin D. Walker and Alton W. Whitehouse (Chairman) are the
members of the Compensation Committee, which establishes compensation for the
Company's Officers and determines incentive and performance awards. During
1996, there were eight meetings of the Board of Directors, three meetings of
its Audit Committee and four meetings of its Compensation Committee. All
nominees for Director and all continuing Directors attended 75 percent or more
of the meetings of the Board and its Committees which they were eligible to
attend.
Each nonemployee Director who served in 1996 was paid at the annual rate of
$25,000 for services as a Director. Each nonemployee Director serving at the
time of the Annual Meeting of Shareholders on April 16, 1996 received a grant of
200 shares of Common Stock under The Timken Company Long-Term Incentive Plan, as
Amended and Restated, following the meeting, and such Directors will continue to
receive annual grants of 200 shares of Common Stock under the Plan following the
Annual Meeting of Shareholders each year for so long as they continue to serve
as nonemployee Directors. Upon election to the Board, a new nonemployee Director
receives a grant of 1,000 restricted shares under The Timken Company Long-Term
Incentive Plan, as Amended and Restated. Members of the Audit Committee and the
Compensation Committee received additional compensation at the rate of $10,000
per year for the Committee Chairmen and $5,000 per year for each regular
Committee member. Any Director may elect to defer the receipt of all or a
certain specified portion of these fees based upon an Optional Deferment of
Directors' Fees Plan. Under this Plan, amounts deferred by a Director earn
interest and are payable to the Director in a lump sum on the date previously
elected by him or in installment payments beginning when the Director ceases to
be a Director. Directors who are employees of the Company receive no separate
fees as Directors of the Company.
-7-
<PAGE> 10
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table shows, as of January 23, 1997, the beneficial ownership
of Common Stock of the Company by each continuing Director and nominee for
election as a Director, by the Chief Executive Officer (who is also a Director)
and the four other most highly compensated Executive Officers during 1996 (one
of whom is also a Director), and by all continuing Directors, nominees for
Director and Officers as a group. Beneficial ownership of Common Stock has been
determined for this purpose in accordance with Rule 13d-3 under the Securities
Exchange Act of 1934 and is based on the sole or shared power to vote or direct
the voting or to dispose or direct the disposition of Common Stock. Beneficial
ownership as determined in this manner does not necessarily bear on the economic
incidents of ownership of Common Stock.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP OF COMMON STOCK
-------------------------------------------------------------------------------------
SOLE VOTING
OR SHARED VOTING PERCENT OF
INVESTMENT OR INVESTMENT AGGREGATE CLASS
NAME POWER POWER AMOUNT
---------------------------- ------------------ -------------------- -------------------- -------------
<S> <C> <C>
Robert Anderson 2,800 ---- 2,800 *
Bill J. Bowling 52,155 (1) ---- 52,155 (1) *
Stanley C. Gault 8,800 ---- 8,800 *
J. Clayburn La Force, Jr. 1,717 ---- 1,717 *
Robert L. Leibensperger 52,235 (1) ---- 52,235 (1) *
Robert W. Mahoney 1,954 ---- 1,954 *
Jay A. Precourt 2,000 ---- 2,000 *
Thomas W. Strouble 25,111 (1) 100 25,211 (1) *
John M. Timken, Jr. 165,186 134,975 (2) 300,161 (2) 1.0
Ward J. Timken 178,539 (1) 3,260,833 (2) 3,439,372 (1) (2) 11.0
W. R. Timken, Jr. 136,698 (1) 3,830,402 (2) 3,967,100 (1) (2) 12.7
Joseph F. Toot, Jr. 200,956 (1) 100 201,056 (1) *
Martin D. Walker 2,273 ---- 2,273 *
Charles H. West 135,179 (1) 319 135,498 (1) *
Alton W. Whitehouse 4,800 ---- 4,800 *
All Directors, Nominees 1,142,419 (1) 3,925,455 5,067,874 (1) 16.0
for Director and Officers
as a Group (3)
</TABLE>
* Percent of class is less than 1%
-8-
<PAGE> 11
(1) Includes shares which the individual or group named in the table
has the right to acquire, on or before March 24, 1997, through the
exercise of stock options pursuant to the 1985 Incentive Plan and
the Long-Term Incentive Plan, as Amended and Restated, as follows:
Bill J. Bowling - 35,773; Robert L. Leibensperger - 32,875; Thomas
W. Strouble - 12,950; Ward J. Timken - 1,300; W. R. Timken, Jr. -
24,025; Joseph F. Toot, Jr. - 167,377; Charles H. West - 94,800;
all Directors, Nominees and Officers as a Group - 464,814. Such
shares have been treated as outstanding for the purpose of
calculating the percentage of the class beneficially owned by such
individual or group, but not for the purpose of calculating the
percentage of the class owned by any other person.
(2) Includes shares for which another individual named in the table is
also deemed to be the beneficial owner, as follows: John M.
Timken, Jr. - 129,875; Ward J. Timken - 3,171,428; W. R. Timken,
Jr. - 3,408,619.
(3) The number of shares beneficially owned by all Directors, nominees
for Directors and Officers as a group has been calculated to
eliminate duplication of beneficial ownership.
Members of the Timken family, including Messrs. John M. Timken, Jr., Ward
J. Timken and W. R. Timken, Jr., have in the aggregate sole or shared voting
power with respect to at least an aggregate of 5,818,454 shares (18.7%) of
Common Stock, which amount includes 25,325 shares that members of the Timken
family have the right to acquire, on or before March 24, 1997, as set forth in
footnote (1) above. The members of the Timken family identified in the table are
not deemed to be the beneficial owners of all such shares. The Timken Foundation
of Canton, 236 Third Street, S.W., Canton, Ohio 44702, holds 2,623,972 of these
shares, representing 8.4% of the outstanding Common Stock. Messrs. Ward J.
Timken, W. R. Timken, Jr. and Don D. Dickes are trustees of the Foundation and
share the voting and investment power.
Participants in the Company's Savings and Investment Pension Plan have
voting power over an aggregate of 2,835,540 shares (9.1%) of Common Stock of the
Company.
A filing with the Securities and Exchange Commission dated February 12,
1997, by Brinson Partners, Inc., 209 South LaSalle, Chicago, Illinois 60604,
indicates that this entity and its affiliated companies have or share voting or
investment power over 2,181,423 shares (7.0%) of the Company's outstanding
Common Stock.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
An option grant awarded to Ward J. Timken in 1995 was inadvertently
omitted from his reports filed pursuant to Section 16(a) of the Securities
Exchange Act for that year and was reported late in his Form 5 for 1996.
-9-
<PAGE> 12
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning 1994, 1995 and 1996
compensation for the Company's Chief Executive Officer and the four other most
highly compensated Executive Officers who were Executive Officers during 1996.
<TABLE>
<CAPTION> ----------------------- ------------------------------------- -----------
ANNUAL LONG TERM
COMPENSATION COMPENSATION
----------------------- --------------------------------
AWARDS
-------------------------------------
(A)
RESTRICTED SECURITIES (B)
NAME AND STOCK UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS AWARD(S) OPTIONS COMP
($) ($) ($) (#) ($)
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Joseph F. Toot, Jr. 1996 693,902 500,000 298,948 31,000 51,285
President and 1995 626,826 421,000 254,856 28,000 45,670
Chief Executive Officer 1994 596,223 366,000 196,000 25,000 27,082
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
W. R. Timken, Jr. 1996 619,631 416,000 116,396 31,000 45,799
Chairman - Board of 1995 560,577 376,000 71,197 28,000 40,829
Directors 1994 534,200 327,000 56,550 25,000 24,265
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
Robert L. Leibensperger 1996 398,333 231,000 77,875 15,000 27,707
Executive Vice President 1995 344,936 204,000 68,523 12,000 21,387
and President - Bearings 1994 244,630 120,000 56,300 6,400 11,117
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
Bill J. Bowling (C) 1996 279,500 177,000 69,959 13,000 17,572
Executive Vice President 1995 212,697 102,500 54,641 4,700 13,142
and President - Steel 1994 191,900 73,000 46,400 4,000 8,827
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
Thomas W. Strouble (D) 1996 266,667 135,000 37,405 9,000 17,465
Vice President - 1995 246,582 113,000 26,614 7,000 14,793
Technology 1994 203,350 75,000 23,700 3,500 9,354
- -------------------------------- --------- ------------ ---------- ------------------ ------------------ -----------
</TABLE>
(A) The amounts shown are dividend equivalents earned as described in
footnote A of the Option Grants in Last Fiscal Year Table. Dividend
equivalents are not traditional restricted stock but deferred shares with
no voting rights or statutory dividend rights. The deferred shares are
subject to forfeiture until issued to the optionee, which occurs after 4
years provided the optionee remains in the continuous employ of the
Company or a subsidiary and does not choose to defer issuance to a later
date under the Company's Deferred Compensation Plan. In addition, they
may vest earlier than 4 years in the event of retirement, disability or
death. The dollar value of the deferred shares earned is equal to the
total amount per share of cash dividends paid on outstanding Common
Shares during the calendar year 1996 multiplied by the number of Common
Shares subject to outstanding options plus unvested deferred shares. In
1996, the total cash dividend paid on outstanding Common Shares was $1.20
per share. The numbers of deferred shares earned in 1996 were as follows:
Mr. Toot: 6,572 shares; Mr. Timken: 2,559 shares; Mr. Leibensperger:
1,712 shares; Mr. Bowling: 1,538 shares and Mr. Strouble: 822 shares.
-10-
<PAGE> 13
(B) The amounts shown in this column have been derived as follows:
Mr. Toot:
--------
1996 - $7,600 annual Company contribution to the Savings and Investment
Pension Plan (SIP Plan).
1996 - $43,685 annual Company contribution to the Post Tax Savings and
Investment Pension Plan (Post Tax SIP Plan).
Mr. Timken:
----------
1996 - $7,600 annual Company contribution to the SIP Plan.
1996 - $38,199 annual Company contribution to the Post Tax SIP Plan.
Mr. Leibensperger:
-----------------
1996 - $7,600 annual Company contribution to the SIP Plan.
1996 - $20,107 annual Company contribution to the Post Tax SIP Plan.
Mr. Bowling:
-----------
1996 - $7,600 annual Company contribution to the SIP Plan.
1996 - $9,972 annual Company contribution to the Post Tax SIP Plan.
Mr. Strouble:
------------
1996 - $7,600 annual Company contribution to the SIP Plan.
1996 - $9,865 annual Company contribution to the Post Tax SIP Plan.
(C) Mr. Bowling was elected to the position of Executive Vice President and
President-Steel effective April 1, 1996.
(D) Mr. Strouble was elected to the position of Vice President - Technology
effective April 18,1995.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning stock option grants
made to the individuals named in the Summary Compensation Table during 1996
pursuant to The Timken Company Long-Term Incentive Plan, as Amended and
Restated.
<TABLE>
<CAPTION>
GRANT DATE
INDIVIDUAL GRANTS VALUE
- ------------------------------------------------------------------------------ -------------------------------------
PERCENT
(A) OF TOTAL
NUMBER OF OPTIONS
SECURITIES GRANTED TO EXERCISE (B)
UNDERLYING EMPLOYEES OR BASE GRANT DATE
OPTIONS IN FISCAL PRICE EXPIRATION PRESENT VALUE
NAME GRANTED YEAR ($/SHARE) DATE ($)
- ------------------------ -------------- ------------------ --------------- -------------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Joseph F. Toot, Jr. 31,000 9.5% $44.125 April 16, 2006 $326,740
W. R. Timken, Jr. 31,000 9.5% $44.125 April 16, 2006 326,740
Robert L. Leibensperger 15,000 4.6% $44.125 April 16, 2006 158,100
Bill J. Bowling 13,000 4.0% $44.125 April 16, 2006 137,020
Thomas W. Strouble 9,000 2.8% $44.125 April 16, 2006 94,860
(A) Options granted in 1996 are exercisable starting 12 months after the date
granted, with 25% of the options covered thereby becoming exercisable at
that time and with an additional 25% becoming exercisable on each
successive anniversary date. The options granted in 1996 provide for the
crediting to the optionee of dividend equivalents (amounts equal to the
dividends paid on common stock) payable in the form of Company Common
Stock or cash, but only when total net income per share of the
outstanding Common Stock is at least two and one half times the total
amount of cash dividends paid per share during the calendar year. The
agreements pertaining to these options also provide that such options
will become exercisable in full in the event of a change in control, as
defined in such agreements, of the Company. If, following a change in
control, the optionee's employment is terminated, all dividend
equivalents are also vested.
For additional information about dividend equivalents, refer to Footnote
A of the Summary Compensation Table.
</TABLE>
-11-
<PAGE> 14
(B) The rules on executive compensation disclosure issued by the Securities
and Exchange Commission authorize the use of variations of the
Black-Scholes option pricing model in valuing executive stock options.
The Company used this model to estimate grant date present value. In
applying this model, basic assumptions were made concerning variables
such as expected option term, interest rates, stock price volatility and
future dividend yield, to establish an initial option value. The initial
option value was then reduced to reflect vesting restrictions. This
adjustment was accomplished by discounting the initial option value to
reflect estimates of annual executive turnover and the average vesting
period. There is, of course, no assurance that the value actually
realized by an executive will be at or near the estimated value, for the
actual value, if any, an executive may realize will depend on the excess
of the stock price over the exercise price on the date the option is
exercised. The Company does not advocate or necessarily agree that the
Black-Scholes model, even when coupled with discounting for vesting
restrictions, can properly determine the value of an option.
The following assumptions were used in establishing the initial option
value: (a) an option term of 8 years, which is the expected life of the
option based on historical experience of stock option exercises by
executives at the Company; (b) an interest rate of 6.52%, which is the
interest rate for a 8-year treasury bond on April 16, 1996; (c)
volatility of .2193 calculated using the quarter ending stock price for
5 years prior to the grant date; and (d) dividend yield of 3.33%, the
average amount paid annually, over the 5 years prior to grant date. The
following assumptions were used to discount the initial value for
vesting restrictions: (a) discount factor of 3% per year, the estimated
annual turnover for executives excluding retirement, and (b) an average
vesting period of 2.5 years.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information with respect to stock option
grants for the individuals named in the Summary Compensation Table under The
1985 Incentive Plan of The Timken Company or The Timken Company Long-Term
Incentive Plan, as Amended and Restated.
<TABLE>
<CAPTION>
(A) (B)
Shares Number of Securities Value of
Acquired Value Underlying Options In-The-Money Options
On Exercise Realized At Fiscal Year-End At Fiscal Year-End
(#) ($) (#) ($)
-------------------------------- -------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ------------------------- ------------- ------------ ------------- -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Joseph F. Toot, Jr. 18,123 $218,609 167,377 69,500 $2,299,606 $439,375
W. R. Timken, Jr. 0 0 24,025 69,500 298,891 439,375
Robert L. Leibensperger 13,623 155,500 32,875 28,625 394,113 156,413
Bill J. Bowling 5,352 68,270 35,773 19,775 562,332 91,272
Thomas W. Strouble 2,500 38,875 12,950 16,850 154,756 90,606
(A) The value realized on the exercise of options is based on the difference
between the exercise price and the fair market value of the Company's
Common Stock on the date of exercise.
(B) Based on the difference between the exercise price and the closing stock
price on the New York Stock Exchange at year end.
</TABLE>
-12-
<PAGE> 15
PENSION PLAN TABLE
The following table shows the estimated annual retirement benefits for
Executive Officers in the earnings and years of service combinations indicated.
Amounts shown in the table are developed assuming retirement at age 62 and Final
Average Earnings equal to Remuneration in 1996.
<TABLE>
<CAPTION>
YEARS OF SERVICE (A) (B)
-------------------------
REMUNERATION (C) 30 35 40
- ----------------------------- ------- ------- -------
<S> <C> <C> <C> <C>
$ 400,000 220,500 257,250 294,000
500,000 275,625 321,563 367,500
600,000 330,750 385,875 441,000
700,000 385,875 450,188 514,500
800,000 441,000 514,500 588,000
900,000 496,125 578,813 661,500
1,000,000 551,250 643,125 735,000
1,100,000 606,375 707,438 808,500
1,200,000 661,500 771,750 882,000
1,300,000 716,625 836,063 955,500
1,400,000 771,750 900,375 1,029,000
(A) Amounts in this section of the table have been developed in accordance with the provisions of the retirement
plan and individual agreements based upon a straight life annuity, not under any of the various survivor options
and before adjustment for Social Security benefits (officers' benefits are subject to Social Security offsets).
These amounts have been determined without regard to the maximum benefit limitations for defined benefit plans
and the limitations on compensation imposed by the Internal Revenue Code of 1986, as amended. The Board of
Directors has authorized a supplemental retirement plan and individual agreements that direct the payment out of
general funds of the Company of any benefits calculated under the provisions of the applicable retirement plan
that may exceed these limits.
(B) The credited years of service as of December 31, 1996, for the individuals listed in the Summary Compensation
Table are 34 for Mr. Toot, 34 for Mr. Timken, 36 for Mr. Leibensperger, 31 for
Mr. Bowling and 40 for Mr. Strouble. There is no incremental benefit level for years of service in excess
of 40.
(C) Plan benefits are based upon average earnings, including any cash bonus
plan awards for the highest five consecutive years of the ten years
preceding retirement ("Final Average Earnings"). For the years prior to
1994, only fifty percent of any cash bonus plan award is included in the
calculation of average earnings.
</TABLE>
CHANGE IN CONTROL SEVERANCE AGREEMENTS
The Company is a party to Severance Agreements with 13 of its senior
executives (including all of those individuals named in the Summary Compensation
Table). Under these Agreements, when certain events occur, such as a reduction
in the individual's responsibilities or termination of the individual's
employment, following a change in control of the Company (as defined in the
Agreements), the individual will be entitled to receive payment in an amount,
grossed up for any excise taxes payable by the individual, equal to three times
the individual's annual base salary and highest annual incentive compensation
during the past three years plus a lump sum amount representing a supplemental
pension benefit. The individual would also receive certain benefits under the
SIP Plan and the Post Tax SIP Plan. The Severance Agreements also permit the
individual to resign for any reason or without reason during the 30-day period
immediately following the first anniversary of the first occurrence of a change
in control and receive the severance benefits. The amounts payable under these
Severance Agreements are secured by a trust arrangement.
-13-
<PAGE> 16
CHANGE IN CONTROL SEVERANCE PAY PLAN
The Company has implemented a Severance Pay Plan covering approximately
ninety key associates (other than those that are party to Severance Agreements).
Under the Severance Pay Plan, an individual whose employment is terminated
following a change in control (as defined in the Plan) may be entitled to
receive payment in an amount equal to 150% to 200% of the individual's annual
base salary (depending upon length of service), grossed up for any excise taxes
payable by the individual, and may also have certain benefits continued for a
period of six months. The Company has created a trust arrangement to provide
funds for the enforcement of the Severance Pay Plan.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors is
composed of Robert Anderson, Stanley C. Gault, Martin D. Walker and Alton W.
Whitehouse, Chairman. No member of the Committee is a former or current officer
or employee of the Company or of any of its subsidiaries.
COMPENSATION PHILOSOPHY
- -----------------------
The Company's compensation philosophy focuses on both short and long-term
incentive programs that, when added to base salary, provide a total compensation
package that will enable the Company to attract and retain superior quality
executive officers. This approach is intended to enhance Company performance and
shareholder value by tying in closely the financial interests of executive
officers and senior managers with those of shareholders. Specifically, the
Committee's philosophy includes these three primary ingredients:
- Provide sufficient opportunity in total direct compensation that
enables the Company to attract, retain and motivate superior quality
executive management.
- Establish base salaries for executive management based upon market data
from a related group of companies.
- Link the financial interests of executive management with those of
shareholders, with short and long-term incentive plans tied to
corporate, business unit and individual performance.
The Company, with the Committee's guidance and approval, has developed a
compensation program based on this philosophy for executive officers, including
the Chief Executive Officer and the other named executive officers. This program
has three components: base salary, performance bonus and long-term incentives.
Base salaries, on average, are administered at the market median. The Company
relies on its performance bonus and long-term incentive awards, tied directly to
individual, business unit and corporate performance, to provide total direct
compensation at the desired level. The Committee determines specific
compensation actions for the Chief Executive Officer and considers and acts upon
recommendations made by the Chief Executive Officer regarding compensation of
other executive officers and key associates.
In 1996, the Company conducted a review of total direct compensation paid
by companies having, in general, net sales from $1-6 billion dollars and which
are comparable for compensation purposes. Total direct compensation includes
base salary, performance bonus and long-term incentives. The Company compared
total direct compensation opportunity provided to executive officers to median
total direct compensation for the selected companies as reported in the 1996
Towers Perrin and Management Compensation Services ("Project 777") executive
compensation surveys. Following completion of this analysis and development of
proposed base salary ranges and target bonus opportunities, an independent
compensation consultant reviewed the findings and met with the Committee. The
Compensation Committee approved management's recommendation for revised base
salary ranges and target bonus opportunities for the executive officer positions
effective January 1, 1997.
-14-
<PAGE> 17
The Compensation Committee has addressed the impact of section 162(m) of
the Internal Revenue Code by approving a policy whereby an executive officer may
enter into an agreement to defer any compensation that exceeds the $1 million
limit and by recommending changes to The Timken Company Long-Term Incentive
Plan, as Amended and Restated allowing certain grants under the plan to qualify
as performance-based compensation. The policy to defer compensation was adopted
in November 1994 and went into effect beginning with the year 1995. Amounts of
compensation that will be deferred will be credited with interest quarterly at
the prime rate in effect on the last day of the calendar quarter plus 1%. The
Committee believes that this policy will benefit the Company by preserving the
tax deduction for executive compensation while maintaining the ability to use
appropriate discretion in determining annual levels of compensation. Messrs.
Toot and Timken have signed individual agreements to defer any compensation that
exceeds the $1 million limit as defined in section 162(m) of the Internal
Revenue Code. There will be a deferral for Messrs. Toot and Timken in regard to
their 1996 compensation. The Committee will continue to monitor the executive
compensation program as it is affected by current and future tax laws.
BASE SALARY
- -----------
Base salary ranges are developed to reflect the varying levels of
responsibility of the Chief Executive Officer and other executive officers. The
current salary ranges are based on external surveys and in consultation with an
independent compensation consultant. Base salary ranges generally are equivalent
to amounts paid to senior managers with comparable responsibilities for the
companies studied. Periodically, the Committee reviews the recommendations of
the Chief Executive Officer and the Vice President - Human Resources & Logistics
and approves, with any modifications it deems appropriate, individual base
salary amounts for executive officers based on individual performance and
position in the salary range.
The companies included in the surveys used to develop base salary ranges
are not the same companies used in the peer group index appearing in the
performance graph. For compensation purposes, the Company uses surveys of
companies of similar size and industry because this is the employment market in
which it competes. The performance graph, on the other hand, employs a peer
index blending the Dow Jones Steel Index and seven bearing companies that are
direct competitors of the Company's Bearing Business. Of the seven bearing
companies, five are foreign companies. The reason for selecting the companies in
the peer index had no relationship to compensation comparisons, where the
Company seeks to look at other companies of similar size and industry that are
more representative of the employment market for executive management whether or
not they are in the bearing or steel business.
PERFORMANCE BONUS
- -----------------
The Company's Management Performance Plan provides cash bonuses to be paid
to executive officers and senior managers based principally on the achievement
of specific operating performance goals established annually by the Committee
and thereafter approved by the Board.
Management recommends performance goals to the Committee based upon
business plans approved by management and reviewed with the Board of Directors.
In 1996, the Management Performance Plan provided for target bonus
opportunities for executive officers that ranged from 35 to 60 percent of base
salary, though amounts could vary above and below that range depending upon
company and business unit performance (including financial and non-financial
measures) and individual accomplishment. Bonus opportunities for the Chairman of
the Board and the Chief Executive Officer were based upon the attainment of
corporate goals and individual performance, with bonus opportunities for the
other executive officers based on a combination of corporate, business unit and
individual performance. The Company requires a minimum level of earnings to fund
any bonuses.
-15-
<PAGE> 18
The Plan's primary performance measurement is Return on Invested Capital
defined as Earnings Before Interest and Taxes as a percentage of Beginning
Invested Capital (EBIT/BIC). This measure is closely correlated with the
creation of shareholder value and is the major measure from which the bonus pool
is derived. In addition, in 1996 specific goals were established for three
additional key measures all aligned with the creation of shareholder and
customer value. The measures were achievement of Accelerated Continuous
Improvement savings and performance goals, achievement of the Company's
consolidated free cash flow target, and achievement of Continuous Improvement
commitments for 1996.
For the second year in a row, Corporate and Business Unit EBIT/BIC exceeded
prior year results and were the highest recorded performance levels over the
last ten years. To determine individual bonus payments, accomplishments of
specific EBIT/BIC targets at the corporate and business unit levels were
considered. In addition, discretionary adjustments were made by the Committee
for achievements in the other key areas mentioned above. Finally, the bonus
amounts were adjusted to reflect individual performance of the participants.
This resulted in cash bonus payments for the executive officers that ranged from
71% to 42% of base salary in effect on November 1, 1996.
At its December meeting, the Board approved the goals set by the Committee
for the Management Performance Plan for 1997. In addition to corporate and
business unit EBIT/BIC goals, three key areas of emphasis have been selected for
1997. These are achieve Business Plan targets for Inventory Days, achieve
Business Plan targets for Sales Growth, and achieve Customer Satisfaction Goals
Established for 1997. Target bonus opportunity for executive officers in 1997
will range from 40 to 65 percent of base salary. The target bonus may be
adjusted for achievement of the specific EBIT/BIC goals and discretionary
adjustments may be made by the Committee for the achievement of the other key
performance targets.
LONG-TERM INCENTIVES
- --------------------
The Committee recommended and the shareholders approved the Company's
Long-Term Incentive Plan, as Amended and Restated, effective April 16, 1996. To
keep the Company's plan current, it was necessary to implement the following
changes: qualification of compensation paid to executives that is subject to
section 162(m) of the Internal Revenue Code; additional language permitting
grants of performance shares and units; addition of limitation on the number of
restricted and deferred shares that can be granted; establishment of a minimum
vesting period on restricted and deferred shares; addition of transferability
provision and addition of 1,500,000 shares to the plan.
The number of shares that may be issued or transferred under the Plan may
not exceed in the aggregate 2,900,000 shares of Common Stock. Although awards
under the Plan can be made in the form of non-qualified stock options, incentive
stock options, appreciation rights, performance shares or performance units,
restricted shares and deferred shares, the Committee has chosen to primarily
grant non-qualified stock options. The option price per common share must be
equal to or greater than the market value per share on the date of the grant.
For grants to executive officers and the Chief Executive Officer, the Committee
has granted non-qualified stock options with an option price at market value on
the date of grant. The use of non-qualified stock options enables executive
officers and other participants to gain value if the Company's shareholders gain
value. Moreover, this Plan provides a mechanism for incentives to participants
even in years when no payout is made under the Management Performance Plan.
Deferred shares or restricted shares have not been granted to executive officers
except when the individual has been hired into the position from outside the
Company.
-16-
<PAGE> 19
Awards under the Long-Term Incentive Plan, as Amended and Restated are
considered annually. On April 16, 1996, the Committee approved a grant of
non-qualified stock options for the executive officers and other key associates.
The initial dollar value for each participant's grant was determined by
multiplying the midpoint of their salary range by a position level multiple that
ranged from .25 to 1.34. The position level multiples were derived from data on
similar-sized companies as reported in the Towers Perrin Long-Term Incentive
Survey compiled in 1995. The number of stock options to grant was calculated by
dividing each participant's salary range midpoint by the present value of the
Company's stock options including dividend credits. The present value of the
option was based on achieving a 10% growth in stock price and a 5% growth in
dividend yield per year and was adjusted to reflect vesting restrictions. After
this initial determination, management reviewed and revised as necessary the
size of the proposed grant based on individual performance. The Chief Executive
Officer and the Vice President Human Resources and Logistics presented the
recommended grants to the Committee. The Committee reviewed and approved the
long-term incentive grants considering the formula, individual performance and
the number of shares allocated to the Plan.
To drive the achievement of higher levels of earnings, the Long-Term
Incentive Plan, as Amended and Restated has a dividend feature that provides
additional compensation only when the Company achieves a specified level of
earnings. This feature entitles each participant in the Plan to receive dividend
equivalents payable in Common Shares on a deferred basis (called Deferred
Dividend Shares). The dividend equivalent is calculated by multiplying the cash
dividend per share paid during the year earned times the number of unexercised
stock options plus any unvested Deferred Dividend Shares held by each
participant. The product is divided by the average closing price of the
Company's Common Stock as reported on the New York Stock Exchange for the 10
days preceding December 31 to establish the number of Deferred Dividend Shares
that are credited to each participant. Unexercised stock options and unvested
Deferred Dividend Shares awarded to participants prior to 1996 will earn
dividend credits if net income per share for the year exceeds 200 percent of the
total amount of cash dividends per share during the year. Unexercised stock
options and unvested Deferred Dividend Shares awarded to participants after 1995
will earn dividend credits if net income per share for the year exceeds 250
percent of the total amount of cash dividends per share during the year. In no
event may any participant in any period of one calendar year earn Deferred
Dividend Shares with a value in excess of $750,000. The Deferred Dividend Shares
vest 4 years from the date of grant if the associate is still in the employ of
the Company and does not choose to defer them under the Company's Deferred
Compensation Plan. The Deferred Dividend Shares may vest earlier than 4 years in
the event of retirement, disability or death. The total number of Deferred
Dividend Shares granted for 1996 was 36,428.
Share ownership requirements have been established for executive officers
and other key executives. These guidelines recommend a specific level of
ownership ranging from one to three times salary be achieved within five years
(seven years can be used for some exceptional circumstances) of the effective
date of the guidelines.
CHIEF EXECUTIVE OFFICER COMPENSATION
- ------------------------------------
The Chief Executive Officer's compensation is based upon the same factors
previously discussed with regard to the executive officer compensation
philosophy. The components making up his compensation include base salary,
performance bonus and long-term incentives. The base salary range for the Chief
Executive Officer is determined using survey data in the same manner as for
other executive officers. Effective February 1, 1996, Mr. Toot's base salary was
increased 12 percent. Mr. Toot's prior base salary increase was on January 1,
1995 in the amount of 1.9% as a result of a reduction in the vacation allowance
for executives.
The Chief Executive Officer's compensation is related to the Company's
performance through the Management Performance Plan and the Long-Term Incentive
Plan, as Amended and Restated. The methodology used to calculate Mr. Toot's
compensation under either plan is the same as for other executive officers.
-17-
<PAGE> 20
The Company's overall performance, as well as its performance with regard
to cash flow, achievement of Accelerated Continuous Improvement savings and
performance improvement goals, and the achievement of continuous improvement
commitments, resulted in a 1996 performance bonus of $500,000 for Mr. Toot.
On April 16, 1996, Mr. Toot, along with the other executive officers,
received non-qualified stock options pursuant to the provisions of The Timken
Company Long-Term Incentive Plan, as Amended and Restated approved by
shareholders on April 16, 1996. Mr. Toot received non-qualified stock options
for 31,000 shares as a result of the 1996 grant.
The Company's earnings performance in 1996 of $4.43 per share, was 369
percent of the cash dividends on the Company's Common Stock of $1.20 per share.
As a result, on December 31, 1996, Mr. Toot, along with the other executive
officers, was credited with Deferred Dividend Shares representing 6,572 shares
which will vest on December 31, 2,000.
At its December meeting, the Committee conducted an evaluation of the Chief
Executive Officer's performance. The Committee is pleased with Mr. Toot's
leadership under which the company has achieved numerous strategic objectives.
The Company continues to improve its operating results while growing and
strengthening its leadership position worldwide.
For the third year in a row, sales have grown to a record level totaling
2.4 billion dollars for 1996. After-tax earnings of $139 million were also at
record levels. The Company's return on invested capital, as measured by
EBIT/BIC, was 15.2% compared to 12.7% in 1995. Earnings per share were $4.43 in
1996, a 23% increase over the $3.60 per share in 1995.
Mr. Toot has successfully led the Company in expanding its operations
throughout the world. In 1996, the Company purchased a bearing operation in
Poland and concluded a joint venture agreement in China, thus positioning itself
to develop and expand sales and service to customers in the Central Europe and
Asia Pacific markets, respectively. It also entered into a definitive agreement
to purchase the assets of an Italian bearing manufacturer. The Company has
expanded its steel operations through the acquisition domestically of Ohio Alloy
Steels and Houghton & Richards, Inc. and in England of the finishing and
distribution business of Sanderson & Kayser Ltd., which will enable the Company
to enhance its position as a leader in the production and distribution of high
alloy steels.
These affiliations and strategic plant expansions in the United States and
abroad have increased the company's geographic presence, strengthened its
business leadership position and taken it further along the value-creation
stream in continuing to improve service for customers. At the same time, Mr.
Toot has directed continuous improvement initiatives which have reduced costs,
improved productivity and enhanced customer service.
During the 1990s, Mr. Toot's leadership has led to increasingly strong
financial performance. The Company's five-year cumulative total return of 17.5%
continues to lead other bearing and steel companies as reported in the peer
index and for the last five years has exceeded or closely matched the return
represented by the S&P 500 index.
Total shareholder return for 1996 was 23.0%, the highest in three years.
Compensation Committee
Alton W. Whitehouse, Chairman
Robert Anderson
Stanley C. Gault
Martin D. Walker
-18-
<PAGE> 21
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
AMONG TIMKEN COMPANY, S&P 500 & PEER INDEX**
[GRAPHIC OMITTED]
Assumes $100 invested on January 1, 1992, in Timken Company Common Stock, S&P
500 Index and Peer Index.
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996
------- ------- ------- ------ -------
<S> <C> <C> <C> <C> <C>
TIMKEN COMPANY $115.76 $151.59 $163.57 $182.45 $224.50
S&P 500 107.65 118.43 119.97 164.92 202.78
70% BEARING/30% STEEL 95.87 123.80 145.52 139.10 139.75
*Total returns assumes reinvestment of dividends.
**Fiscal year ending December 31.
</TABLE>
The line graph compares the cumulative, total shareholder returns over five
years for The Timken Company, the S&P 500 Stock Index, and a peer index that
proportionately reflects The Timken Company's two businesses. The Dow Jones
Steel Index comprises 30% of the peer index and the remaining 70% is a self
constructed bearing index that consists of seven companies. These seven
companies are Brenco, FAG, Kaydon, Koyo, NSK, NTN, and SKF. The five
international bearing companies in the index are traded in Germany, Japan and
Sweden. The total returns for these markets equivalent to the S&P 500 Index were
$209.69, $89.38 and $413.74, respectively, with a $100 investment over five
years.
-19-
<PAGE> 22
ITEM NO. 2
----------
SHAREHOLDER PROPOSAL
The Congregation of the Sisters of Charity of the Incarnate Word, P.O. Box
230969, 6510 Lawndale, Houston, Texas 77223-0969, owners of 1,300 shares of
Common Stock, has given notice it intends to sponsor a proposal for action by
the shareholders at the Annual Meeting. Citizens Trust, 111 Pine Street, Suite
1415, San Francisco, California 94111, owners of 2,300 shares of Common Stock,
has given notice that it is co-sponsoring the proposal. The following supporting
statement and resolution were furnished by the proponents of the shareholder
proposal.
SHAREHOLDERS' STATEMENT IN SUPPORT OF THE PROPOSAL
We believe board composition of major corporations should reflect more
closely the population in the workforce and marketplace if our company is going
to remain competitive. The bipartisan Glass Ceiling Commission, "Good For
Business: Making Full Use of the Nation's Human Capital," reported diversity and
inclusiveness in the workplace has a positive impact on the bottom line based on
Covenant Fund Report on Standard and Poor 500 companies: "...Firms that succeed
in shattering their own glass ceiling racked up stock market records that were
nearly 2-1/2 times better than otherwise comparable companies."
In 1994 the Investor Responsibility Research Center reported inclusiveness
at senior management and board levels at only 9% in Fortune 500 companies. The
Glass Ceiling Commission reported that companies select from only half of the
talent of our workforce. If we are to be prepared for the twenty-first century,
we must learn how to compete in an increasingly diverse global marketplace by
selecting the best people regardless of race, gender or physical challenge. We
believe the judgments and perspectives of a diverse board would improve the
quality of corporate decision-making. Since the board is responsible for
representing shareholder interests, we urge our corporation to enlarge its
search for qualified board members.
A growing proportion of stockholders attach value to board inclusiveness.
The Teachers Insurance and Annuity Association and College Retirement Equities
Fund, the largest institutional investor in the United States, recently issued a
set of corporate governance guidelines including a call for "diversity of
directors by experience, sex, age and race."
Robert Campbell, CEO of Sun Oil, stated in The Wall Street Journal on
August 12, 1996 that, "Often what a woman or minority person can bring to the
board is some perspective a company has not had before -- adding some modern-day
reality to the deliberation process. Those perspectives are of great value, and
often missing from an all white-male gathering. They can also be inspirational
to the company's diverse workforce."
W. R. Grace's 1996 proxy states their Board "...recognizes that its
composition should reflect the global nature of the Company's operations and
the diversity of its workforce. The Board also recognizes that it is in a
unique position to "set the tone at the top" and to demonstrate its belief that
diversity makes good business sense."
We request the Nominating Committee of the Board make a greater effort to
find qualified women and minority candidates for nomination to the Board.
THEREFORE BE IT RESOLVED THAT SHAREHOLDERS REQUEST:
1. The Board issue a policy publicly committing the company to board
inclusiveness, a program of steps, and the timeline expected to move
in that direction.
2. The company issue a report by September 1997 summarizing:
a) efforts to encourage diversified representation on our board.
b) criteria for board qualification
c) the process of selecting the board candidates
d) the process of selecting the board committee members including
the nominating committee.
-20-
<PAGE> 23
BOARD OF DIRECTORS' STATEMENT IN OPPOSITION TO THE PROPOSAL
The Timken Company is committed to providing equal opportunity to all
associates and applicants and a workplace that is free of discrimination on the
basis of race, religion, national origin, sex, age or disability. It is the
Company's policy to treat all associates and applicants equally according to
their individual qualifications, ability, experience and other employment
standards.
It is the responsibility of the Board of Directors to select candidates for
membership on the Board whose skills in light of the perceived needs of the
Board at the time of selection will provide optimum representation for the
shareholders' interests without regard to race, religion, national origin,
gender, age or disability.
This approach recognizes fully the value of diverse perspectives among
Board members. The composition of the current Board, including as it does
representatives of varied business backgrounds as well as academia, provides
such diverse perspectives. Further, under the oversight of the Board, the
Company's five year cumulative total return has led other steel and bearing
companies as reported in the peer index and for the past four years has exceeded
or closely matched the returns represented by the S&P 500 Index.
The Board believes that the interests of the Company and its shareholders
are best served by allowing the Board maximum flexibility to seek the most
highly qualified Directors without establishing formalistic procedures or
arbitrary deadlines. The shareholder proposal would inappropriately restrict the
Board in the exercise of its responsibility and would be detrimental to the best
interests of the Company and its shareholders.
VOTE REQUIRED TO ADOPT SHAREHOLDER PROPOSAL
The affirmative vote of a majority of the votes cast at the meeting is
required to adopt the shareholders' proposal. Abstentions and broker non-votes
will not be counted for determining whether the proposal is adopted.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST THE ADOPTION OF THE
SHAREHOLDERS' PROPOSAL.
-21-
<PAGE> 24
AUDITORS
The independent accounting firm of Ernst & Young LLP has acted as the
Company's auditor for many years and has been selected as the auditor for the
current year. Representatives of that firm are expected to be present at the
Annual Meeting and will have an opportunity to make a statement, if they so
desire, and will be available to respond to appropriate questions.
GENERAL
On the record date of February 21, 1997, there were outstanding 31,173,585
shares of Common Stock, each entitled to one vote upon all matters presented to
the meeting.
The enclosed proxy is solicited by the Board of Directors, and the entire
cost of solicitation will be paid by the Company. In addition to solicitation by
mail, Officers and regular employees of the Company, without extra remuneration,
may solicit the return of proxies by telephone, telegraph, facsimile, personal
contact or other means of communication. Brokerage houses, nominees, fiduciaries
and other custodians will be requested to forward soliciting material to the
beneficial owners of shares held of record by them and will be reimbursed for
their expenses. The Company has retained Georgeson & Co. to assist in the
solicitation of proxies for a fee not to exceed $9,500, plus reasonable
out-of-pocket expenses.
Shares represented by properly executed proxies will be voted at the meeting
in accordance with the shareholders' instructions. In the absence of specific
instructions, the shares will be voted for the election of Directors as
indicated under Item No. 1 and AGAINST Item No. 2.
You may, without affecting any vote previously taken, revoke your proxy by a
later dated proxy received by the Company, or by giving notice to the Company
either in writing or at the meeting.
First Chicago Trust Company of New York will be responsible for tabulating
the results of shareholder voting. First Chicago will submit a total vote only,
keeping all individual votes confidential. Representatives of First Chicago will
serve as inspectors of election for the Annual Meeting. Under Ohio law and the
Company's Amended Articles of Incorporation and Amended Regulations, properly
executed proxies marked "abstain" will be counted for purposes of determining
whether a quorum has been achieved at the Annual Meeting, but proxies
representing shares held in "street name" by brokers that are not voted will not
be counted for quorum purposes. Such abstentions and "broker non-votes" will not
be counted in the election of Directors.
AFTER APRIL 1, 1997, THE COMPANY WILL FURNISH TO EACH SHAREHOLDER, UPON
WRITTEN REQUEST AND WITHOUT CHARGE, A COPY OF THE COMPANY'S ANNUAL REPORT ON
FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1996, INCLUDING FINANCIAL STATEMENTS
AND SCHEDULES THERETO, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
REQUESTS SHOULD BE ADDRESSED TO SCOTT A. SCHERFF, DIRECTOR - LEGAL SERVICES AND
ASSISTANT SECRETARY, THE TIMKEN COMPANY, 1835 DUEBER AVENUE, S.W. - GNE-01,
CANTON, OHIO 44706-2798.
-22-
<PAGE> 25
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs American Express Trust Company to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE LATROBE STEEL
COMPANY VOLUNTARY INVESTMENT PROGRAM AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 26
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 27
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs Banque Nationale De Paris to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE PLAN EUROPEEN
D'ACTIONNARIAT TIMKEN AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 28
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 29
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs American Express Trust Company to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE TIMKEN
COMPANY--LATROBE STEEL COMPANY SAVINGS AND INVESTMENT PENSION PLAN AND
MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 30
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 31
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs American Express Trust Company to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE TIMKEN COMPANY
HOURLY PENSION INVESTMENT PLAN AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 32
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 33
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs American Express Trust Company to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE TIMKEN
COMPANY VOLUNTARY INVESTMENT PENSION PLAN AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 34
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 35
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs Barclays Global Investors to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE MPB
CORPORATION EMPLOYEES' SAVINGS PLAN AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 36
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 37
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs Godwins Trustees Limited to appoint W.R.
R Timken, Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE TIMKEN
EUROPEAN STOCK OWNERSHIP PLAN AND MAIL IN THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 38
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 39
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned instructs Mutual Life of Canada to appoint W.R. Timken,
R Jr., Joseph F. Toot, Jr., and Larry R. Brown, and each of them, as
O true and lawful proxies, with full power of substitution, to vote and act
X for the undersigned at the Annual Meeting of Shareholders of THE TIMKEN
Y COMPANY to be held at 1835 Dueber Avenue, S.W., Canton, Ohio, on April 15,
1997, at 10:00 A.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the matters set
forth on the reverse hereof, and, in their discretion on such other matters
as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE FOR THE CANADIAN TIMKEN
LIMITED SALARIED ASSOCIATES RETIREMENT SAVINGS PLAN AND MAIL IN THE ENCLOSED
ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 40
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
<PAGE> 41
THE TIMKEN COMPANY
Proxy Solicited on Behalf of the Board of Directors
P The undersigned appoints W.R.Timken, Jr., Joseph F. Toot, Jr., and Larry R.
R Brown, and each of them, as true and lawful proxies, with full power of
O substitution, to vote and act for the undersigned at the Annual Meeting of
X Shareholders of THE TIMKEN COMPANY to be held at 1835 Dueber Avenue, S.W.,
Y Canton, Ohio, on April 15, 1997, at 10:00 A.M., and at any adjournment
thereof, as fully as the undersigned could vote and act if personally
present on the matters set forth on the reverse hereof, and, in their
discretion on such other matters as may properly come before the meeting.
ITEM 1. ELECTION OF DIRECTORS
Elect Stanley C. Gault, John M. Timken, Jr., W.R. Timken, Jr., and Alton W.
Whitehouse in Class III for a term expiring at the 2000 Annual Meeting.
ITEM 2. SHAREHOLDER PROPOSAL REGARDING BOARD INCLUSIVENESS.
PLEASE SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE AND MAIL PROMPTLY USING
THE ENCLOSED ENVELOPE.
[SEE REVERSE SIDE]
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
TIMKEN PARKING: Shareholders attending the meeting
ANNUAL MEETING may park in the visitor lot behind the
OF Corporate Office building.
SHAREHOLDERS
NOTE: If your shares are held in street
April 15, 1997 name, please bring a letter with you from
10:00 a.m. your broker stating as such to the annual
meeting.
Corporate Auditorium (CIG)
The Timken Company
1835 Dueber Avenue, S.W. [MAP]
Canton, Ohio 44706-2798
Telephone: (330) 438-3000 THE TIMKEN COMPANY
CORPORATE OFFICES
CORPORATE AUDITORIUM AND VISITORS
PARKING
MAJOR ROUTES TO
THE TIMKEN COMPANY
<PAGE> 42
[ X ] Please mark your
votes as in this
example.
The shares represented by this proxy will be voted as recommended by the Board
of Directors unless otherwise specified.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote "FOR" this Item. The Board of Directors Recommends a vote "AGAINST" this item.
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] 2. Shareholder proposal requesting the [ ] [ ] [ ]
Directors Board adopt a policy and issue a report
(see reverse) on Board inclusiveness.
For, except vote withheld from the following nominee(s):
- ----------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: Please sign exactly as name or names appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.
-------------------------------------------------------
Signature(s) of Shareholder(s) Date
-------------------------------------------------------
Signature if held jointly Date
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
THE TIMKEN COMPANY
CANTON, OHIO
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------------
The Annual Meeting of Shareholders of The Timken Company will be held on
Tuesday, April 15, 1997, at 10:00 A.M., at 1835 Dueber Avenue, S.W., Canton,
Ohio, for the following purposes:
1. To elect four Directors of serve in Class III for a term of three years.
2. To consider a shareholder proposal sponsored by two shareholders
requesting the Board adopt a policy and issue a report on Board
inclusiveness, if the proposal is presented at the meeting.
3. To transact such other business as may properly come before the
meeting.
Holders of Common Stock of record at the close of business on February 21,
1997, are the shareholders entitled to notice of and to vote at the meeting.
PLEASE SIGN, DATE AND RETURN THE PROXY CARD ABOVE, WHETHER OR NOT YOU
EXPECT TO ATTEND THE MEETING. For your convenience, a self-addressed envelope is
enclosed requiring no postage if mailed in the United States.
If you have any questions about he voting procedure, please contact Lynn
Hill at (330) 471-3376.
March 5, 1997 LARRY R. BROWN
Vice President and General Counsel
YOUR VOTE IS IMPORTANT. PLEASE RETURN
YOUR PROXY CARD.
