TRANS-LUX CORPORATION
110 Richards Avenue
Norwalk, Connecticut 06856-5090
_____________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 27, 1998
_____________________________
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
TRANS-LUX CORPORATION will be held at the Office of the Corporation, 110
Richards Avenue, Norwalk, Connecticut, on Wednesday, May 27, 1998 at
10:00 A.M. local time for the following purposes:
1. To elect four directors to serve for a term of three years, in
each case until their successors shall be elected and shall have
qualified;
2. To consider and act upon separate proposals to amend the
Corporation's Certificate of Incorporation to (a) increase authorized
shares of Common Stock to 11,000,000 shares and (b) increase authorized
shares of Class A Stock to 6,000,000 shares.
3. To consider and act upon a proposal to recommend to the Board of
Directors the retention of Deloitte & Touche LLP as the Corporation's
independent auditors for the ensuing year; and
4. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
The close of business on March 31, 1998 has been fixed as the record
date for the determination of the stockholders entitled to notice of and
to vote at the Meeting.
By Order of the Board of Directors,
Angela D. Toppi
Secretary
Dated: Norwalk, Connecticut
March 31, 1998
_____________________________________________________________________________
Please mark, date, sign and return promptly the enclosed proxy so that your
shares may be represented at the Meeting. A return envelope, which requires
no postage if mailed in the United States, is enclosed for your convenience.
_____________________________________________________________________________
TRANS-LUX CORPORATION
110 Richards Avenue
Norwalk, Connecticut 06856-5090
_________________
PROXY STATEMENT
This statement is furnished in connection with the solicitation by
the Board of Directors of TRANS-LUX CORPORATION (hereinafter called the
"Corporation"), of proxies in the accompanying form to be used at the
Annual Meeting of the Stockholders of the Corporation to be held on
Wednesday, May 27, 1998, and at any adjournment thereof, for the purposes
set forth in the accompanying notice of the Meeting. It is intended that
this Statement and the proxies solicited hereby be mailed to stockholders
no later than April 14, 1998. A stockholder who shall sign and return a
proxy in the form enclosed with this statement has the power to revoke it
at any time before it is exercised by giving written notice of revocation
or a proxy of later date and returning it to the Corporation, Attention:
Secretary, or by voting in person at the Meeting. Proxies properly
executed and received in time for the Meeting will be voted.
The close of business on March 31, 1998 has been fixed as the record
date for the determination of the stockholders entitled to notice of and
to vote at the Meeting. There were outstanding as of the close of
business on March 31, 1998 and entitled to notice of and to vote at the
Meeting 992,843 shares of Common Stock and 297,286 shares of Class B
Stock. Each outstanding share of Common Stock shall be entitled to one
vote on all matters voted on at the Meeting and each outstanding share of
Class B Stock is entitled to ten votes on all matters voted on at the
Meeting. The holders of Common Stock and Class B Stock vote together to
elect directors and recommend auditors and as separate classes on the
proposals to amend the Corporation's Certificate of Incorporation to
increase authorized shares of Common Stock and Class A Stock.
Unless otherwise specified, the proxies in the accompanying form will
be voted in favor of all of the proposals set forth in the Notice of
Annual Meeting. In the discretion of the proxyholders, the proxies will
also be voted for or against such other matters as may properly come
before the Meeting. The Board of Directors is not aware that any other
matters are to be presented for action at the Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS, DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information as of March 31, 1998 (or
such other date specified) with respect to the beneficial ownership of
the Corporation's Class B Stock and Common Stock or shares acquirable
within 60 days of such date by (i) each person known by the Corporation
to own more than 5% of the Corporation's outstanding Class B Stock and/or
Common Stock and who is deemed to be such beneficial owner of the
Corporation's Class B Stock and Common Stock under Rule 13d-3(a)(ii);
(ii) each person who is a director of the Corporation; (iii) each named
executive in the Summary Compensation Table; and (iv) all persons as a
group who are executive officers and directors of the Corporation, and as
to the percentage of outstanding shares held by them on that date.
<TABLE>
<CAPTION>
Amount Percent
Name, Status Beneficially Percent of all
& Mailing Address Title of Class Owned of Class Classes
- ----------------- -------------- ------------ -------- -------
<S> <C> <C> <C> <C>
Richard Brandt Class B Stock 189,195(1) 63.57% 14.66%
Chairman of the Board Common Stock 16,068(1) 1.59% 1.23%
of Directors and beneficial
owner of more than
5% of the Corporation's
Class B Stock
110 Richards Avenue
Norwalk, CT 06856-5090
Fidelity Low-Priced Stock Common Stock 94,279(2) 9.14% 7.10%
Fund
Beneficial owner of
more than 5% of the
Corporation's Common Stock
82 Devonshire Street
Boston, MA 02109-3614
Franklin Resources, Inc. Common Stock 1,141,797(3) 53.49% 46.94%
Beneficial owner of
more than 5% of the
Corporation's Common Stock
777 Mariners Island Blvd.
San Mateo, CA 94404
Froley, Revy Investment Common Stock 383,216(4) 27.85% 22.90%
Co., Inc.
Beneficial owner of
more than 5% of the
Corporation's
Common Stock
10900 Wilshire Blvd.
Suite 1050
Los Angeles, CA 90024
Gabelli Funds, Inc. Common Stock 111,254(5) 10.83% 8.40%
Beneficial owner of
more than 5% of the
Corporation's
Common Stock
One Corporate Center
Rye, NY l0580-l434
The Killen Group, Inc. Common Stock 603,241(6) 43.42% 35.76%
Beneficial owner of
more than 5% of the
Corporation's
Common Stock
1199 Lancaster Avenue
Berwyn, PA 19312
The TCW Group, Inc. Common Stock 62,800(7) 6.33% 4.87%
Beneficial owner of
more than 5% of the
Corporation's
Common Stock
865 South Figueroa Street
Los Angeles, CA 90017
Matthew Brandt Class B Stock 23,700 7.96% 1.84%
Beneficial owner of Common Stock 2,300(8) * *
more than 5% of the
Corporation's
Class B Stock
110 Richards Avenue
Norwalk, CT 06856-5090
Thomas Brandt Class B Stock 23,700(9) 7.96% 1.84%
Beneficial owner of Common Stock 1,354 * *
more than 5% of the
Corporation's
Class B Stock
110 Richards Avenue
Norwalk, CT 06856-5090
Steven Baruch Common Stock 600 * *
Director
110 Richards Avenue
Norwalk, CT 06856-5090
Howard M. Brenner Common Stock 1,500(10) * *
Director
277 Park Avenue
New York, NY 10172
Jean Firstenberg Common Stock 1,420(11) * *
Director
110 Richards Avenue
Norwalk, CT 06856-5090
Allan Fromme Class B Stock 2,013 * *
Director Common Stock 2,900(12) * *
110 Richards Avenue
Norwalk, CT 06856-5090
Robert Greenes Common Stock 5,056(13) * *
Director
110 Richards Avenue
Norwalk, CT 06856-5090
Gene Jankowski Common Stock 2,500 * *
Director
110 Richards Avenue
Norwalk, CT 06856-5090
Victor Liss Class B Stock 9,728 3.27% *
Director, Vice Common Stock 53,306(14) 5.13% 3.99%
Chairman, President
and Chief Executive
Officer
110 Richards Avenue
Norwalk, CT 06856-5090
Howard S. Modlin Class B Stock 8,751(15) 2.94% *
Director Common Stock 2,500(15) * *
445 Park Avenue
New York, NY l0022
Michael R. Mulcahy Common Stock 7,303(16) * *
Executive Vice President
110 Richards Avenue
Norwalk, CT 06856-5090
Karl P. Hirschauer Common Stock 3,629(17) * *
Senior Vice President
110 Richards Avenue
Norwalk, CT 06856-5090
Thomas F. Mahoney Common Stock 1,000(18) * *
Senior Vice President
110 Richards Avenue
Norwalk, CT 06856-5090
All directors and Class B Stock 257,087(19) 86.38% 19.92%
executive officers Common Stock 110,586(19) 10.23% 8.02%
as a group (17 persons)
</TABLE>
(1) The amount includes 12,500 shares of Common Stock acquirable upon
exercise of stock options, 3,568 shares of Common Stock acquirable upon
conversion of $50,000 principal amount of the Corporation's 7 1/2%
Convertible Subordinated Notes due 2006 (the "Notes"), and 4,232 shares
of Class B Stock owned by Mrs. Brandt.
(2) Based on Schedule 13G dated February 14, 1998 by FMR Corp.
("FMR") a parent holding company, Edward C. Johnson III and Abigail P.
Johnson, shareholders and directors of FMR whose family members may be
deemed to control FMR, Fidelity Management & Research Company
("Fidelity"), a wholly-owned subsidiary of FMR and a registered
investment adviser, and Fidelity Low-Priced Stock Fund (the "Fund"), a
registered investment company, the amount includes 38,179 shares of
Common Stock acquirable upon conversion of $535,000 principal amount of
the Notes, all of which were owned by the Fund. FMR has sole power to
dispose or to direct the disposition of such shares. Fidelity carries
out the voting of the shares based on written guidelines by the Fund's
Board of Directors.
(3) Based on Schedule l3G, Amendment No. 1 dated February 6, 1998 by
Franklin Resources, Inc., a parent holding company, Charles B. Johnson
and Rupert H. Johnson, Jr., principal shareholders of said company and
Franklin Advisers, Inc., an investment adviser, the amount includes
1,141,797 shares of Common Stock acquirable upon conversion of
$16,000,000 principal amount of the Notes beneficially owned by one or
more open or closed-end investment companies or other managed accounts
which are advised by direct and indirect investment advisory subsidiaries
of Franklin Resources, Inc., each of which is a registered investment
advisor and which have all voting and investment power over the Notes.
(4) Based on Schedule 13G dated February 14, 1997 and other telephonic
advice, by Froley, Revy Investment Co., Inc., a registered investment
adviser, the amount includes 383,216 shares of Common Stock acquirable
upon conversion of $5,370,000 principal amount of the Notes held in
accounts of its clients, none of which would hold 5% or more of the
Common Stock upon conversion. The investment adviser has sole
dispositive power and no voting power with respect thereto.
(5) Based on Schedule 13D, Amendment No. 25, dated March 16, 1998 by
Gabelli Funds, Inc., the amount includes 34,254 shares of Common Stock
acquirable upon conversion of $480,000 principal amount of the Notes.
All securities are held as agent for the account of various investment
company fund accounts managed by the reporting persons. Except under
certain conditions, Gabelli Funds, Inc. has sole voting power and sole
dispositive power over such shares.
(6) Based on Schedule 13G, Amendment No. 1 dated February 17, 1998 and
other telephonic advice, by Killen Group, Inc., a registered investment
adviser, has sole dispositive power of 206,823 shares of Common Stock and
sole power to vote 71,200 of such shares, and its clients for whom the
shares were purchased, have the right to the proceeds of a sale. The
amount also includes 396,418 shares acquirable upon conversion of
$5,555,000 principal amount of the Notes held for such client accounts.
(7) Based on amended Schedule 13G, Amendment No. l, dated February 16,
l996 filed by such parent holding company and Robert Day who is deemed to
control The TCW Group, Inc. and also deemed a parent holding company and
other telephonic advice. The TCW Group, Inc. has sole voting power and
sole dispositive power over all such 62,800 shares.
(8) The amount includes 1,820 shares of Common Stock acquirable upon
exercise of stock options. Matthew Brandt is Mr. R. Brandt's son.
(9) Thomas Brandt is Mr. R. Brandt's son.
(10) The amount includes 500 shares of Common Stock acquirable upon
exercise of stock options.
(11) The amount includes 1,000 shares of Common Stock acquirable upon
exercise of stock options.
(12) The amount includes 2,500 shares of Common Stock acquirable upon
exercise of stock options. Dr. Fromme is Mr. Brandt's brother-in-law.
(13) The amount includes 2,500 shares of Common Stock acquirable upon
exercise of stock options.
(14) The amount includes 45,900 shares of Common Stock acquirable upon
exercise of stock options.
(15) The amount includes 2,500 shares of Common Stock acquirable upon
exercise of stock options, 3,460 shares of Class B Stock owned by Mr.
Modlin's immediate family and 2,479 shares of Class B Stock in trust for
Mr. Modlin's immediate family.
(16) The amount includes 4,000 shares of Common Stock acquirable upon
exercise of stock options.
(17) The amount includes 3,000 shares of Common Stock acquirable upon
exercise of stock options.
(18) The amount includes 1,000 shares of Common Stock acquirable upon
exercise of stock options.
(19) The amount includes 84,509 shares of Common Stock which members of
the group have the right to acquire by exercise of stock options
(including director stock options), 10,171 shares of Class B Stock set
forth in footnotes 1 and 15 above and 3,568 shares of Common Stock
acquirable upon conversion of the Notes set forth in footnote 1 above.
* Less than l%
ELECTION OF DIRECTORS
The Board of Directors of the Corporation is divided into three
classes with the term of office of one of the three classes of directors
expiring each year and with each class being elected for a three-year
term. Four directors are to be elected at the May 27, l998 Annual
Meeting for a three-year term, and until their successors have been
elected and qualified. Messrs. R. Brandt, Jankowski and Liss and Ms.
Firstenberg nominated for election as directors for a three-year term
were each elected a director of the Corporation at the 1995 Annual
Meeting of Stockholders.
Set forth opposite the name of the nominees and each director is
their principal occupation for the past five years, age, the name and
principal business of any corporation or other organization in which such
employment is carried on, certain other directorships held, the year
first elected as a director and the year in which the term of office for
which they are a nominee or the term of office of such person will
expire.
Principal Occupation, First
Other Directorships Became Term
Name and Age Director Expires
____ _____________________ ________ _______
NOMINEES - THREE-YEAR TERM
Richard Brandt Chairman of the Board 1954 2001
of Trans-Lux Corporation;
Director of Presidential
Realty Corporation; Vice
Chairman and Trustee of
The College of Santa Fe;
Chairman Emeritus and
Trustee of the American
Film Institute; Trustee of
American Theatre Wing; 70
Jean Firstenberg Chief Executive Officer and 1989 2001
Director of the American
Film Institute; Trustee of Boston
University; 62
Gene Jankowski Chairman of Jankowski 1994 2001
Communications System, Inc.;
formerly President and Chairman
of the CBS Broadcast Group;
Adjunct Professor of Telecommunications
for Michigan State University;
Chairman Emeritus of the American
Film Institute; Director of
The Advertising Educational
Foundation; and advisor to the
World Press Freedom Foundation; 63
Victor Liss Vice Chairman of the Board, 1988 2001
President and Chief Executive
Officer of Trans-Lux Corporation;
Director of Anthem, Inc. and
Anthem Blue Cross & Blue
Shield of Connecticut; Trustee
of Norwalk Hospital; 61
DIRECTORS - TWO-YEAR REMAINING TERM
Allan Fromme Psychologist, Author, 1958 2000
Consultant, Chairman of the
Executive Committee of
Trans-Lux Corporation; 82
Steven Baruch Executive Vice President 1994 2000
of Presidential Realty
Corporation; producer
of plays and musicals, among
them Driving Miss Daisy, Angels
in America, Love Letters, Smokey Joe's
Cafe and the Broadway revivals of Damn
Yankees, A Funny Thing Happened
on the Way To The Forum and
The Sound of Music; 59
Howard M. Brenner Vice Chairman of Loewenbaum & Company 1997 2000
Incorporated, formerly Vice Chairman of
Southcoast Capital Corporation and
President of Brenner Securities Corporation
which was merged into Southcoast Capital
Corporation which changed its name to
Loewenbaum & Company Incorporated;
formerly President of Drexel Burnham
Lambert Incorporated; former member
of Board of Governors of the American Stock
Exchange and District 10 Committee
(NY) National Association of Securities
Dealers Inc.; 64
DIRECTORS ONE-YEAR REMAINING TERM
Robert Greenes Vice Chairman of the 1971 1999
Executive Committee of
Trans-Lux Corporation;
President of Petroconsult,
Inc.; President of East Coast
Energy Council; formerly President
and Chief Executive Officer
of Public Fuel Service Inc.
and all of its subsidiaries; 77
Howard S. Modlin Attorney and member of the 1975 1999
firm Weisman Celler Spett &
Modlin, P.C.; Director of Fedders
Corporation and General DataComm
Industries, Inc.; 66
EXECUTIVE COMPENSATION AND TRANSACTIONS WITH MANAGEMENT
Compensation of Executive Officers
The following Summary Compensation Table sets forth the compensation
paid or awarded for each of the three years in the period ended December
31, l997 to the Chief Executive Officer and the Corporation's four other
most highly compensated executive officers.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation
-------------------
Long Term
Compensation All Other
Name and Other Annual Options Compensation
Principal Position Year Salary($) Bonus($) Compensation($) Granted(#) ($) (1)
- ------------------ ---- --------- -------- --------------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Richard Brandt 1997 318,421 123,037 69,830 -- 8,424
Chairman of the 1996 105,578 93,163 267,049 -- 14,975
Board (2) 1995 -- 78,618 368,146 -- 57,549
Victor Liss 1997 238,847 185,124 5,150 25,000 8,763
Chief Executive Officer, 1996 212,885 133,434 5,150 -- 4,180
President and Vice Chairman 1995 223,237 106,230 4,800 5,000 l,888
Michael R. Mulcahy 1997 255,164 30,000 -- -- --
Executive Vice 1996 211,760 33,219 -- -- --
President, former 1995 166,593 21,458 -- 1,500 --
Senior Vice President
and Vice President
of Sales
Karl P. Hirschauer 1997 112,153 7,813 -- -- --
Senior Vice President 1996 103,846 5,938 -- -- --
former Vice President 1995 98,654 5,000 -- 1,000 --
of Engineering
Thomas F. Mahoney 1997 138,976 7,813 -- -- --
Senior Vice President, former 1996 128,660 3,463 -- -- --
Vice President and Assistant 1995 144,415 -- -- 1,000 --
Vice President of Sales
______________________
</TABLE>
(l) There are no restricted stock awards, stock appreciation rights or
deferred long-term incentive payouts. The amounts reflected for Mr. Brandt
include $7,874, $13,764 and $57,549 for tax equalization payments in 1997,
1996 and 1995, respectively, resulting from limitations placed on the
Retirement Plan by the Internal Revenue Code and FICA taxes. The amounts
reflected for Mr. Liss represent split dollar life insurance, additional life
insurance and disability insurance.
(2) During the period January l, l994 to August l5, l996, the Chairman was not
an executive officer under the Corporation's by-laws and the bonuses and other
annual compensation constituted fees and other payments under his former
consulting agreement with the Corporation. Other annual compensation for
Messrs. R. Brandt and Liss includes directors fees.
Compensation Committee Report
All matters concerning executive compensation for Mr. Liss, the
Chief Executive Officer, and other executive officers are considered by
the Corporation's Compensation Committee. The salary levels are intended
to be consistent with competitive practice and level of performance. In
determining the total compensation to be paid to the Chief Executive
Officer and all other executive officers, the Compensation Committee
considers management's recommendations based upon past salary levels,
contractual obligations where applicable, experience, capability, duties,
normal salary increase levels in past years, and the Corporation's and
respective individual's performance during the last fiscal year. The
Chief Executive Officer's compensation is based upon the above factors
and includes bonuses as described in the section on Employment
Agreements.
Retirement Plan and Supplemental Retirement Benefits
A cash contribution of $247,255 for the individuals listed in the
Summary Compensation Table, except Mr. R. Brandt, and all other
eligible employees to the Corporation's retirement plan for 1997 will be
made prior to September 15, 1998. Under the supplemental retirement
arrangement with Mr. Liss, $62,482, $62,512 and $43,723 was accrued but
not paid in 1997, 1996 and 1995, respectively.
The Corporation's retirement plan covers all salaried employees over
age 21 with at least one year of service who are not covered by a
collective bargaining agreement to which the Corporation is a party. The
following table presents estimated retirement benefits payable at normal
retirement date, which normally is age 65. The amounts shown include
estimated Social Security benefits which would be deducted in calculating
benefits payable under such Plan.
Final Average Salary
for Highest Five of Estimated Annual Retirement Benefits
the Ten Years Based on Credited Service Years
Preceding -------------------------------------------------------
Retirement 10 20 30 35 40
----------- -- -- -- -- --
$100,000 $15,000 $30,000 $45,000 $52,500 $60,000
125,000 18,750 37,500 56,250 65,625 75,000
150,000 22,500 45,000 67,500 78,750 90,000
200,000(1) 30,000 60,000 90,000 105,000 120,000(2)
As of January 1, 1998, Messrs. Liss, Mulcahy, Hirschauer and Mahoney
had 29, 30, l8 and 30 years of credited service, respectively.
--------------
(1) $160,000 is the legislated annual cap on compensation.
(2) $125,000 is the maximum legislated annual benefits payable from a
qualified pension plan.
Certain Transactions
During the year 1997, $374,583 in fees for legal services rendered
were paid by the Corporation to the law firm of which Mr. Modlin, a
director of the Corporation, is a member.
A subsidiary of the Corporation loaned an aggregate of $320,385
during the years 1989 through 1996 to Dr. Fromme, Chariman of the
Executive Committee, to fully pay the premiums on a $500,000 life
insurance policy on his life. The Corporation has received an assignment
of the policy as collateral for the repayment to the extent the proceeds
of the policy are in excess of $200,000. The loans plus accrued interest
are repayable solely from the proceeds from the policy.
Messrs. Matthew Brandt and Thomas Brandt are Senior Vice Presidents of
the Corporation and each is employed by the Corporation at an annual
compensation level of $110,000.
Employment Agreements
The Corporation has employment agreements with Messrs. Brandt, Liss,
Mulcahy, Hirschauer and Mahoney expiring on December 31, 2002, April 1,
2002, May 31, 1998, December 31, 1999 and May 31, 1998, respectively.
The agreements provide for annual compensation of $368,535 (subject to
cost of living adjustments) for Mr. Brandt; at the rate of $240,000 in
1998, plus an additional $10,000 each year thereafter for Mr. Liss;
$155,000 through May 1998 for Mr. Mulcahy; $114,000 in 1998 and $120,000
in 1999 for Mr. Hirschauer; and $85,000 through May 1998 for Mr.
Mahoney. Each agreement contains graduated bonus provisions based on the
Corporation's defined pre-tax consolidated earnings, not to exceed
$125,000, $250,000, $30,000, $20,000 and $20,000 in the case of Messrs.
R. Brandt, Liss, Mulcahy, Hirschauer and Mahoney, respectively. Each
agreement also contains varying disability, death and, other than Messrs.
Hirschauer and Mahoney, insurance benefits. Mr. Brandt's agreement
provides for profit participation of 1 1/2% of the Corporation's defined
pre-tax consolidated earnings. Mr. Mulcahy's agreement provides for
sales override commissions and severance benefits. Mr. Mahoney's
agreement provides for sales override commissions. Messrs. Brandt and
Liss have the right to cancel their agreements if, among other things, in
the case of Mr. Liss, Mr. Liss gives six months early termination
notice (after January 1, 2000) or there is a "change in control" as
defined therein or the Corporation fails to elect him to his present
positions and, in the case of Mr. Brandt, the Corporation fails to elect
him to his present position in which case he has the right to receive the
payments for the balance of the term of his agreement, including certain
lump sum payments thereof. The foregoing is a summary of the agreements
and reference is made to the agreements, each of which has been filed
with the Securities and Exchange Commission, for the full terms thereof.
Stock Option Plans and Stock Options
The Corporation has two incentive stock option plans which provide
for the grant of incentive stock options at fair market value (or 110% of
fair market value if the optionee owns more than 10% of the Corporation's
outstanding voting securities) on date of grant. Options outstanding are
exercisable during the period one to ten years after date of grant and
while the holder is in the employ of the Corporation. The following
tables set forth information as to the named executive officers with
respect to the value realized on exercise of stock options, stock options
granted pursuant to the existing plans during 1997, the potential gain
that could be realized if the fair market value of the Corporation's
Common Stock were to appreciate at a 5% or 10% annual rate over the ten
year period of the option term and fiscal year-end option values.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Individual Grants
---------------------------------
% of Potential
Total Realizable Value
Options at Assumed
Granted to Exercise Annual Rates of
Employees or Base Stock Price
Options in Fiscal Price ($) Expiration Appreciation for
Name Granted Year Per Share Date Option Term
- ---- -------- ---- --------- ---- ------------------
5% ($) 10% ($)
------ -------
<S> <C> <C> <C> <C> <C> <C>
Victor Liss 25,000 92.25% $11.0625 1/1/2007 174,000 441,000
</TABLE>
<TABLE>
<CAPTION>
Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year End Option Values
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
Option Exercises Fiscal Year End Fiscal Year End($)
------------------------ --------------- ------------------
Shares
Acquired on Value Exercisable/ Exercisable/
Name Exercise Realized($) Unexercisable Unexercisable (1)
- ---- -------- ---------- ------------- ------------------
<S> <C> <C> <C> <C>
Richard Brandt -- -- 12,500/ -- 90,625/--
Victor Liss 5,194 39,349 20,900/25,000 141,781/92,188
Michael R. Mulcahy -- -- 5,500/-- 30,313/--
Karl P. Hirschauer -- -- 3,000/-- 18,563/--
Thomas F. Mahoney -- -- 1,000/-- 6,625/--
- -------------
</TABLE>
(1) Market value of underlying securities at fiscal year end, minus the
exercise price.
FIVE YEAR CORPORATE PERFORMANCE GRAPH
The following graph compares the Corporation's total stockholder
return over the five fiscal years ended December 31, 1997 with the total
return on the American Stock Exchange Market Value Index ("AMEX MKT"),
the Russell 2000 Index ("RUSSELL 2000") and The American Stock Exchange
New England Regional Index ("AMEX NE"). The American Stock Exchange has
ceased to track the AMEX NE, therefore the Corporation has selected the
RUSSELL 2000 as a peer group. The stockholder return shown on the graph
as "TLX" is not intended to be indicative of future performance of the
Corporation's Common Stock.
COMPARATIVE FIVE YEAR TOTAL RETURNS *
Trans-Lux Corporation, AMEX Market Value Index, Russell 2000 **, AMEX
New England Regional Index **
<TABLE>
<CAPTION>
1992 1993 l994 l995 l996 1997
----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AMEX MKT 100 119.52 108.69 137.32 146.10 177.20
- --------------------------------------------------------------------------
RUSSELL 2000 100 117.00 113.28 142.97 164.07 197.74
- --------------------------------------------------------------------------
AMEX NE 100 117.69 112.07 154.67 135.19
- --------------------------------------------------------------------------
TLX 100 119.75 119.95 106.82 146.19 195.41
- --------------------------------------------------------------------------
</TABLE>
* Cumulative total return assumes reinvestment of dividends.
** Peer group consists of the RUSSELL 2000 and the AMEX NE. Assumes
$100 investment at the close of trading on the last trading day
preceding the first day of the fifth preceding fiscal year in TLX
Common Stock, AMEX MKT, RUSSELL 2000 and AMEX NE.
PROPOSALS TO AMEND THE CORPORATION'S CERTIFICATE OF
INCORPORATION TO (A) INCREASE AUTHORIZED SHARES OF COMMON STOCK
TO 11,000,000 SHARES AND (B) INCREASE AUTHORIZED SHARES OF CLASS A
STOCK TO 6,000,000 SHARES.
At the present time the Corporation has authorized capital of
10,000,000 shares consisting of 5,500,000 shares of Common Stock, $1.00
par value, 3,000,000 shares of Class A Stock, $1.00 par value, 1,000,000
shares of Class B Stock, $1.00 par value and 500,000 shares of Preferred
Stock, $1.00 par value. Of the Common Stock, 2,759,446 shares are issued
and outstanding, 1,766,603 shares are held in treasury and 2,740,554
shares are authorized, but unissued. Of such 2,740,554 unissued shares,
2,721,184 are reserved for conversion of Class B Stock, Convertible Notes
and Stock Option Plans. There are 297,286 shares of Class B Stock
outstanding and no shares of Class A Stock or Preferred Stock
outstanding. The Board of Directors has proposed separate votes that the
authorized Common Stock be increased from 5,500,000 shares to 11,000,000
shares, the authorized Class A Stock be increased from 3,000,000 shares
to 6,000,000 shares and the total authorized shares be accordingly
increased.
The purpose of the amendments is to provide greater flexibility in
the capitalization of the Corporation to meet the constantly changing
needs of the Corporation and the market place. The additional shares of
Common Stock and/or Class A Stock may be issued from time to time in
connection with equity capital offerings, acquisitions, employee
stock option plans, stock dividends, and other corporate purposes. If
the proposed amendments are authorized, the Board of Directors may be in
a position to issue such shares without further approval of the
stockholders, although certain employee stock options or similar plans
may require stockholders' approval. Although the Corporation is
continually alert to acquisitions and other investment opportunities,
there have been no previous acquisitions for stock.
The total authorized shares of Common Stock is being increased to
provide shares to be available upon conversion of the Class A Stock under
limited circumstances (see "Description of Capital Stock -
Convertibility"). The Common Stock and Class A Stock have substantially
identical rights, except that the holders of the Class A Stock have a 10%
higher dividend right than the Common Stock (and 22.2% higher than Class
B Stock) and are not entitled to vote on any matter unless and until all
of the Class B Stock is converted into Common Stock as provided in the
Certificate of Incorporation or as otherwise required by law. It is
intended that an application for listing the Class A Stock on the
American Stock Exchange will be filed if and when it meets such
Exchange's listing requirements.
Except for the stock dividends, any issuances of additional Class B
shares must be authorized by vote of a majority of each of the
outstanding shares of Common Stock and Class B Stock. Accordingly the
authorized amount of Class B Stock remains unchanged because the Board of
Directors believes there will be sufficient shares available to cover any
foreseeable requirements of Class B Stock for stock dividends or stock
splits.
If the stockholders approve the proposals to increase authorized
capital stock, it is expected that an Amendment or Amendments to the
Corporation's Certificate of Incorporation reflecting the changes
resulting from the proposals will subsequently be filed with the
Secretary of State of the State of Delaware and become effective on the
respective filing thereof. The Board of Directors in its resolution
authorizing the proposals reserves the right at any time prior to filing
of any such amendments, notwithstanding stockholder approval, to abandon
either or both such proposed amendments. A copy of the first paragraph
of Article Fourth of the Certificate of Incorporation setting forth the
authorized capitalization, as proposed to be amended, is attached hereto
as Exhibit A.
Description of Capital Stock
Following is a summary of the rights, preferences, powers and
limitations of the Common Stock, Class A Stock and Class B Stock.
Voting. The shares of Common Stock are entitled to one vote per
-------
share and the holders of Class B Stock are entitled to ten votes per
share on all matters submitted to stockholders. The holders of Common
Stock are entitled to vote separately as a class (as are the
holders of Class B Stock) on all matters requiring an amendment to the
Corporation's Certificate of Incorporation, as well as on mergers,
consolidations and certain other significant transactions for which
stockholder approval is required under Delaware law. Holders of Common
Stock, Class A Stock and Class B Stock do not have preemptive rights or
cumulative voting rights. Each share of Class A Stock has no voting
rights except as otherwise required by law. Under the Delaware General
Corporation Law, holders of Class A Stock are entitled to vote on
proposals to increase or decrease the number of authorized shares of
Class A Stock, change the par value of the Class A Stock or to alter or
change the powers, preferences or special rights of the shares of Class A
Stock which may affect them adversely.
Dividends and Other Distributions. Dividends on the Common Stock
----------------------------------
will be paid if, and when declared. The Common Stock is entitled to cash
dividends which are 11.1% higher per share than the cash dividends which
may be paid on the Class B Stock. Except as otherwise set forth herein
the Common Stock and the Class B Stock rank equally. Stock dividends on
and stock splits of Common Stock will only be payable or made in shares
of Common Stock while stock dividends on and stock splits of Class B
Stock will only be payable or made in shares of Class B Stock. Each
outstanding share of Class A Stock will be entitled to receive such
dividends and other distributions in cash, stock or property as may be
declared by the Board of Directors of the Corporation, provided that, if
at any time a cash dividend is paid on the Common Stock, a cash dividend
will also be paid on the Class A Stock in an amount 10% higher than the
amount per share paid on the Common Stock and 21.1% higher than that paid
on the Class B Stock. In no event shall dividends and other
distributions be paid on any of the Common Stock, Class A Stock or Class
B Stock unless the other such classes of stock also receive dividends
subject to the above provisions for the requirement of the respective
higher cash dividends for Class A Stock and Common Stock. Dividends or
other distributions payable in shares of stock shall be made to holders
of Class A Stock in shares of Class A Stock. The Certificate of
Incorporation provides that the Board of Directors can authorize a
distribution of Class A Stock proportionately to holders of Common Stock,
Class A Stock and Class B Stock. In no event will either Common Stock,
Class A Stock or Class B Stock be split, divided or combined unless the
others are also proportionately split, divided or combined. The
Corporation currently pays cash dividends on a quarterly basis of $.035
and $.0315 per share on the Common Stock and Class B Stock, respectively.
Convertibility. The Class A Stock will convert into Common Stock
---------------
only at such time as all of the Class B Stock is converted to Common
Stock in accordance with the terms of the Certificate of Incorporation.
The Certificate of Incorporation provides that if the number of shares of
Class B Stock falls below 5% of the aggregate number of outstanding
shares of Common Stock and Class B Stock, or if the Board of Directors
and a majority of the shares of Class B Stock so approve, the
outstanding shares of Class B Stock will be converted into Common Stock.
Other Distributions. The holders of Common Stock, Class A Stock and
--------------------
Class B Stock are each entitled to receive the same consideration per
share in the event of any liquidation, dissolution or winding-up of the
Corporation.
Mergers and Acquisitions. The holders of Common Stock, Class A
-------------------------
Stock and Class B Stock are each entitled to receive the same per share
consideration as the per share consideration, if any, received in a
merger or consolidation of the Corporation (whether or not the
Corporation is the surviving corporation).
Mr. Richard Brandt, individually, owns approximately 62.14% of the
outstanding shares of Class B Stock. Financings, acquisitions or other
transactions involving the issuance of stock which the Board of Directors
determines to be in the best interests of all of the stockholders might
dilute the voting power of existing stockholders, including the holders
of Class B Stock, and might cause the Class B Stock to be converted into
Common Stock by reason of reducing the number of shares of Class B Stock
to fall below 5% of the aggregate number of outstanding shares of Common
Stock and Class B Stock. The Board of Directors of the Corporation
approved the increase in authorized Class A Stock and Common Stock to
provide the Corporation with increased flexibility in the future,
including ability to utilize the Class A Stock to fund employee benefit
plans and to raise equity capital or to issue convertible debt or
convertible preferred stock as means to finance future growth without
diluting the voting power of the Corporation's existing stockholders
including Mr. Brandt if Class A Stock is so utilized. The Corporation
is considering various financing alternatives which may involve the
issuance in the future of equity securities. In order to minimize
dilution of voting power to existing stockholders, the Corporation might
be more likely to issue shares of Class A Stock instead of Common Stock
in the future to raise equity (either through the issuance of Class A
Stock or securities convertible into Class A Stock), finance acquisitions
or fund benefit plans.
The affirmative vote of a majority of the shares entitled to vote of
each of the Common Stock and Class B Stock voting separately is required
to approve each of the proposed amendments to the Corporation's
Certificate of Incorporation to (a) increase authorized shares of Common
Stock to 11,000,000 shares and (b) increase authorized shares of Class A
Stock to 6,000,000 shares. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT THE STOCKHOLDERS VOTE FOR THE PROPOSED AMENDMENTS TO THE
CORPORATION'S CERTIFICATE OF INCORPORATION TO (A) INCREASE AUTHORIZED
SHARES OF COMMON STOCK TO 11,000,000 SHARES AND (B) INCREASE AUTHORIZED
SHARES OF CLASS A STOCK TO 6,000,000 SHARES. IT IS INTENDED THAT PROXIES
SOLICITED HEREBY WILL BE VOTED FOR SUCH AMENDMENT TO THE CERTIFICATE OF
INCORPORATION UNLESS THE STOCKHOLDER SPECIFIES OTHERWISE.
SELECTION OF INDEPENDENT AUDITORS
The auditors recommended to be retained by the Board of Directors,
Deloitte & Touche LLP, have advised the Corporation that they have no
direct financial interest or any material indirect financial interest in
the Corporation, nor did they have any connection during the past three
years with the Corporation in the capacity of promoter, underwriter,
voting trustee, director, officer or employee. Such auditors were first
retained in l987 as auditors for the Corporation's l987 fiscal year.
Representatives of such auditors are expected to be at the Meeting of
the stockholders and will be permitted to make a statement to
stockholders if they desire and to respond to any appropriate questions
addressed by stockholders to such representatives. The affirmative vote
of a majority of the total votes cast at the Meeting by the holders of
Common Stock and Class B Stock combined is required to approve the
proposal to recommend the independent auditors.
MEETINGS OF THE BOARD OF DIRECTORS AND CERTAIN COMMITTEES
During 1997, the Board of Directors had four meetings. All directors
attended 75% or more of such meetings and of committees of which they
were members. Non-employee directors receive an annual fee of $3,500 and
$950 for each meeting of the Board attended, while employee directors
receive an annual fee of $2,200 and $450 for each meeting of the Board
attended.
The members of the Executive Committee of the Board of Directors are
Messrs. Brandt, Greenes, Liss and Modlin and Dr. Fromme. The Executive
Committee is authorized to exercise the powers of the Board of Directors
during the intervals between the meetings of the Board and is from time
to time delegated certain authorizations by the Board in matters
pertaining to the Corporation. The Executive Committee held one formal
meeting in 1997. Non-employee members of said Committee receive a fee of
$550 and employee members receive a fee of $300 for each meeting of the
Committee they attend. Dr. Fromme receives an annual fee of $12,000 as
Chairman of the Executive Committee and for other consulting services,
including his participation in telephonic conferences. Mr. Greenes
receives an annual fee of $6,000 as Vice Chairman of the Executive
Committee and for other consulting services, including his participation
in telephonic conferences.
The members of the Compensation Committee of the Board of Directors
are Messrs. Greenes, Jankowski and Modlin, and Ms. Firstenberg. The
Compensation Committee reviews compensation and other benefits. The
Compensation Committee held two meetings in 1997. Members of said
Committee receive a fee of $300 for each meeting of the Committee they
attend and the Chairman, Mr. Modlin, receives an annual fee of $2,500.
The members of the Audit Committee of the Board of Directors are
Messrs. Baruch, Brenner, Greenes and Modlin and Ms. Firstenberg. The
Audit Committee reviews the audit function and material aspects thereof
with the Corporation's independent auditors. The Audit Committee held
two meetings in 1997. Members of said Committee receive a fee of $300
for each meeting of the Committee they attend and the Chairperson, Ms.
Firstenberg, receives an annual fee of $2,500.
The Board of Directors has not established a nominating or similar
committee.
On June 20, 1989, the Board of Directors established a Non-Employee
Director Stock Option Plan which as amended, covers a maximum of 30,000
shares for grant. Options are for a period of six years from date of
grant, are granted at fair market value on date of grant, may be
exercised at any time after one year from date of grant while a director
and are based on years of service, with a minimum of 500 stock options
for each director, an additional 500 stock options based on five or more
years of service, another 500 stock options based on ten or more years of
service and an additional 1,000 stock options based on twenty or more
years of service. Additional stock options are granted upon the
expiration or exercise of any such option which is no earlier than four
years after date of grant, in an amount equal to such exercised or
expired options.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
OF 1934
The Corporation's executive officers and directors are required under
Section 16(a) of the Securities Exchange Act of 1934 to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission and American Stock Exchange. Copies of those reports must
also be furnished to the Corporation.
Based solely on a review of the copies of reports furnished to the
Corporation and the Corporation's monthly reporting compliance program,
the Corporation believes that during the preceding year all filing
requirements applicable to executive officers and directors were met.
STOCKHOLDER PROPOSALS - 1999 ANNUAL MEETING
If any stockholder desires to submit a proposal for action at the
1999 annual meeting, such proposal must be received by the Secretary of
the Corporation on or before December 31, 1998. Nominations
for directors at the 1999 annual meeting by stockholders must be in
accordance with Article 4(c) of the Corporation's By-Laws and received on
or before January 28, 1999.
COST OF SOLICITATION
The cost of preparing and mailing material in connection with the
solicitation of proxies is to be borne by the Corporation. Solicitation
will be made by the Corporation's regular employees in the total
approximate number of ten. Solicitation will be made by mail, telephone
and in person.
By Order of the Board of Directors
Angela D. Toppi
Secretary
Dated: Norwalk, Connecticut
March 31, 1998
EXHIBIT A
PROPOSED AMENDED FIRST PARAGRAPH OF
ARTICLE FOURTH*
(a) "FOURTH: The aggregate number of shares of all classes which the
Corporation shall have authority to issue 18,500,000, consisting of
11,000,000 shares of Common Stock having a par value of $1.00 per share,
6,000,000 shares of Class A Stock having a par value of $1.00 per share,
1,000,000 shares of Class B Stock having a par value of $1.00 per share,
and 500,000 shares of Preferred Stock having a par value of $1.00 share."
*Assumes both amendments are approved and neither is abandoned.
TRANS-LUX CORPORATION
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
AND PROXY STATEMENT
MAY 27, l998
NORWALK, CONNECTICUT
PROXY
TRANS-LUX CORPORATION
ANNUAL MEETING OF STOCKHOLDERS - MAY 27, l998
(SOLICITED ON BEHALF OF BOARD OF DIRECTORS)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned stockholder of
TRANS-LUX CORPORATION hereby constitutes and appoints RICHARD BRANDT,
VICTOR LISS and HOWARD S. MODLIN, and each of them, the attorneys and
proxies of the undersigned, with full power of substitution, to vote for
and in the name, place and stead of the undersigned, at the Annual
Meeting of the Stockholders of said Corporation, to be held at the office
of the Corporation, 110 Richards Avenue, Norwalk, Connecticut, on May 27,
1998, at 10:00 A.M., and at any adjournment thereof, the number of votes
the undersigned would be entitled to cast if present for the following
matters and, in their discretion, upon such other matters as may properly
come before the meeting or any adjournment thereof:
Directors recommend vote FOR Items 1, 2 and 3.
Item 1 FOR NOT FOR
--- --- Election of Richard Brandt, Jean
/ / / / Firstenberg, Gene Jankowski and
--- --- Victor Liss as directors for a three-
year term, and until their successors
are elected and shall have qualified.
Authority is withheld with respect to the following nominee(s):
____________
____________
Item 2a FOR AGAINST ABSTAIN Approve
increase in authorized
--- --- --- shares of Common
/ / / / / / Stock to 11,000,000
--- --- --- shares
Item 2b FOR AGAINST ABSTAIN Approve
increase in authorized
--- --- --- shares of Class A
/ / / / / / Stock to 6,000,000
--- --- --- shares
Item 3 FOR AGAINST ABSTAIN Recommended
retention of
--- --- --- Deloitte & Touche
/ / / / / / LLP as the
--- --- --- independent auditors
for the Corporation
for the ensuing year.
UNLESS YOU SPECIFY OTHERWISE, THIS PROXY WILL BE VOTED "FOR"
THE ELECTION OF THE NOMINEES FOR DIRECTORS AND "FOR" ITEM 2a, ITEM
2b AND ITEM 3.
(Continued and to be signed on other side.)
A majority of said attorneys and proxies, or their substitutes at said
meeting, or any adjournments thereof, may exercise all of the powers
hereby given. Any proxy to vote any of the shares with respect to which
the undersigned is or would be entitled to vote, heretofore given to any
person or persons other than the persons named above, is hereby revoked.
IN WITNESS WHEREOF, the undersigned has signed and sealed this proxy and
hereby acknowledges receipt of a copy of the notice of said meeting and
proxy statement in reference thereto, both dated March 31, 1998.
Dated: , 1998
---------------
----------------------(L.S.)
Stockholder(s) Signature
----------------------(L.S.)
NOTE: This proxy properly filled in,
dated and signed, should be returned
immediately in the enclosed postpaid
envelope to TRANS-LUX CORPORATION, 110
Richards Avenue, Norwalk, Connecticut
06856-5090. If the signer is a
corporation, sign in full the
corporate name by a duly authorized
officer. If signing as attorney,
executor, administrator, trustee or
guardian, please give your full title
as such.
_________________
