<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
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:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
TRANSTECHNOLOGY CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
N/A
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
COMMON STOCK $0.01 PAR VALUE
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(2) Aggregate number of securities to which transaction applies:
N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
N/A
--------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
N/A
--------------------------------------------------------------------------------
/ / 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:
N/A
--------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
N/A
--------------------------------------------------------------------------------
(3) Filing party:
N/A
--------------------------------------------------------------------------------
(4) Date filed:
N/A
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---------------
1Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE> 2
[LOGO]
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 21, 1995
To the Stockholders of
TransTechnology Corporation:
The Annual Meeting of Stockholders (the "Meeting") of TransTechnology
Corporation (the "Company") will be held at 10:00 a.m., EDT, on Thursday,
September 21, 1995 at the Marriott Financial Center, 85 West Street, New York,
New York, to consider and act upon the following matters:
1. To elect six directors of the Company;
2. To ratify the appointment of Deloitte & Touche as the independent
auditors of the Company; and
3. To transact such other business as may properly come before the
meeting.
Only the stockholders of record at the close of business on July 24, 1995
will be entitled to notice of and to vote at the Meeting or any adjournment or
adjournments thereof. A copy of the Company's Annual Report to Stockholders,
including financial statements for the fiscal year ended March 31, 1995, is
enclosed with this Notice of Annual Meeting.
Whether or not you expect to attend the Meeting, you are urged to sign,
date and return the enclosed proxy in the prepaid envelope provided. All shares
represented by the enclosed proxy, if the proxy is properly executed and
returned, will be voted as you direct. Your proxy will not be used if you attend
the Meeting and vote in person.
By Order of the Board of Directors
(SIG)
VALENTINA DOSS
Vice President, General Counsel and
Secretary
Union, New Jersey
August 9, 1995
<PAGE> 3
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[LOGO] 700 Liberty Avenue, Union, New Jersey 07083
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement (first mailed to shareholders on or about August 9, 1995)
is furnished in connection with the solicitation of proxies by the Board of
Directors (the "Board") of TransTechnology Corporation (the "Company") for use
at the Annual Meeting of Stockholders of the Company (the "Meeting") to be held
on Thursday, September 21, 1995 at 10:00 a.m., EDT, at the Marriott Financial
Center, New York, New York, and any adjournments thereof. All proxies which are
properly completed, signed and returned to the Company prior to the Meeting will
be voted as provided therein. Any proxy given by a shareholder may be revoked at
any time before it is exercised by filing an instrument revoking it with the
Secretary of the Company, by submitting to the Company a duly executed proxy
bearing a later date, or by voting in person at the Meeting.
The only voting securities of the Company consist of its common stock, $0.01 par
value per share (the "Common Stock"). The close of business on July 24, 1995 has
been fixed as the record date for the determination of holders of shares of
Common Stock entitled to vote at the Meeting, and any adjournments thereof. As
of that date, the Company had 5,274,670 shares of Common Stock outstanding. The
holders of shares of Common Stock on the record date are entitled to one vote
for each share on all matters to be considered at the Meeting and any
adjournments thereof.
The holders of record of a majority of the outstanding shares of Common Stock
will constitute a quorum for the transaction of business at the Meeting. As to
all matters, each stockholder is entitled to one vote for each share of Common
Stock he or she holds. The director nominees who receive the greatest number of
votes at the Meeting will be elected to the Board of Directors of the Company.
Votes against a candidate have no legal effect. Abstentions and broker non-votes
are counted for purposes of determining the presence or absence of a quorum for
the transaction of business. Abstentions are counted in tabulations of the votes
cast on proposals presented to stockholders, whereas broker non-votes are not
counted for purposes of determining whether a proposal has been approved.
Stockholders are not entitled to cumulate votes.
The cost of preparing, assembling, printing and mailing this Proxy Statement and
the accompanying form of proxy, and the cost of soliciting proxies relating to
the Meeting will be borne by the Company. The original solicitation of proxies
by mail may be supplemented by telephone, telegram and personal solicitation.
The Company has engaged Beacon Hill Partners, Inc. to assist in the solicitation
of proxies. It is expected that such firm will be paid approximately $3,500 for
such services and will be
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indemnified for matters arising out of this engagement including liabilities
arising under securities laws. In addition, the Company may request banks and
brokers to solicit their customers who beneficially own Common Stock listed of
record in names of nominees, and will reimburse such banks and brokers for their
reasonable out-of-pocket expenses of such solicitation.
For purposes of this Proxy Statement, the fiscal year ended March 31, 1995 shall
be referred to as the fiscal year of 1995 or fiscal 1995.
PROPOSAL 1 -- ELECTION OF DIRECTORS
The Board of Directors of the Company is elected annually. The Certificate of
Incorporation and Bylaws of the Company provide that the number of directors of
the Company shall be not less than five nor more than fifteen, with the exact
number to be fixed by the Bylaws. The Bylaws provide that the exact number of
directors to be elected on September 21, 1995 is six. Unless otherwise
instructed, the proxies received will be voted for the election of the nominees
named below. Although it is not anticipated that any of the nominees will be
unable to serve, in the event any nominee is unable or declines to serve as a
director at the time of the Meeting, the proxy holders will vote for substitute
nominees at their discretion.
No arrangement or understanding exists between any nominee and any other person
or persons pursuant to which any nominee was or is to be selected as a director
or nominee. None of the nominees has any family relationship among themselves or
with any executive officer of the Company.
INFORMATION CONCERNING INCUMBENT DIRECTORS AND NOMINEES TO THE BOARD OF
DIRECTORS
Information is set forth below concerning each nominee for election as a
director. The information was obtained from the Company's records or from
information furnished directly by the individual.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
POSITION WITH DIRECTOR
NAME THE COMPANY AGE SINCE
<S> <C> <C> <C>
-----------------------------------------------------------------------------------------------
Michael J. Berthelot Chairman of the Board of Directors and 45 1991
Chief Executive Officer
Patrick K. Bolger President, Chief Operating Officer and 60 1992
Director
Gideon Argov Director 38 1995
Walter Belleville Director 68 1992
Thomas V. Chema Director 47 1992
James A. Lawrence Director 42 1992
-----------------------------------------------------------------------------------------------
</TABLE>
MR. BERTHELOT has been a director of the Company since January 1991. In
September 1991, he became Vice Chairman of the Company's Board of Directors and
on January 1, 1992, he became acting President and Chief Executive Officer of
the Company. From July to September 1992, Mr. Berthelot was removed from his
Vice Chairman, acting President and Chief Executive Officer positions. From
October 1992 to July 1995, Mr. Berthelot was the Company's
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Chairman of the Board of Directors, President and Chief Executive Officer. Since
July 1995, he continues to serve as Chairman and Chief Executive Officer. Since
September 1981, Mr. Berthelot has been Chief Executive Officer of Canterbury
Holdings Corporation, a private investment company, and, from 1989 to 1992, he
was a partner in the certified public accounting/management consulting firm of
Barnes, Wendling, Cook & O'Conner, Inc.
MR. BOLGER joined the Company as Group Vice President -- Aerospace Products in
January 1990 and became Executive Vice President, Chief Operating Officer and a
director in October 1992. From August to October 1992, Mr. Bolger served as one
of three executive officers in the Company's Office of the President. In July
1995 Mr. Bolger was appointed President and Chief Operating Officer. Prior to
joining TransTechnology, Mr. Bolger operated several small businesses as a
private investor and consultant and from 1982 to 1988, he was Group Vice
President of the Hamilton Standard Division of United Technologies, which
manufactures control systems for the aerospace industry.
MR. ARGOV was appointed to the Board in March 1995 to fill the vacancy created
by Mr. Hofmeister's resignation. Since 1991 Mr. Argov has been President and
Chief Executive Officer of Kollmorgen Corporation, a $200 million diversified
technology company which manufactures high performance motion control and
electro-optical instruments. From 1988 to 1991, Mr. Argov was President, Chief
Executive Officer and a principal of High Voltage Engineering Corporation, a
$150 million diversified electrical producer of industrial controls,
instrumentation and industrial machinery.
MR. BELLEVILLE has been a director of the Company since June 1992. From 1983 to
the present, Mr. Belleville has been Chief Executive Officer and Chairman of the
Board of ATI Machinery, Inc., the largest Caterpillar tractor rental and leasing
company in the western United States. Additionally, since 1985 he has been
Chairman of the Board of Sav-Trac of Arizona, Inc., a heavy equipment repair
facility, President of Happy Horizons, Inc., an aircraft brokerage firm, and
President of Pacific Plus, Inc., a consulting firm specializing in turnarounds
of troubled companies.
MR. CHEMA has been a partner in the law firm of Arter & Hadden since 1989,
specializing in energy and telecommunications consulting. Since January 1990, he
has served as Chairman of the Ohio Building authority, an independent state
agency that annually issues approximately $150 million of bonds and is
responsible for financing and operating state office buildings and other
facilities for the State of Ohio. From May 1990 to July 1995, Mr. Chema also
served as Executive Director of the Gateway Economic Development Corporation of
Greater Cleveland, a not-for-profit corporation chartered to build a baseball
stadium and arena in downtown Cleveland.
MR. LAWRENCE is Chief Operating Officer, Asia/ Middle East/Africa of Pepsi-Cola
International, the unit of Pepsico responsible for soft drink operations outside
North America. From 1992 to 1993 he served as Executive Vice President of
Pepsi-Cola International. From 1983 to 1992, Mr. Lawrence was a partner of the
LEK Partnership, a general partnership organized in England to provide
management consulting and merger and acquisition advisory services. From 1986 to
1992, he was also the Chairman of LEK
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Consulting Inc., the United States operating subsidiary of the partnership. Mr.
Lawrence serves on the Boards of American Re-Insurance Corporation and the
reorganized Transworld Airlines.
THE BOARD OF DIRECTORS
The incumbent directors, other than Mr. Argov, were elected as directors of the
Company at the last annual meeting of stockholders of the Company which was held
in September 1994. Mr. Argov was appointed by the Board to fill a vacancy on the
Board on March 3, 1995.
COMMITTEES
The standing committees of the Board of Directors are the Audit Committee, the
Nominating Committee and the Compensation and Incentives Committee.
The Audit Committee reviews with the Company's independent auditing firm the
results of the firm's annual examination, advises the full Board regarding its
findings and provides assistance to the full Board in matters involving
financial statements and financial controls. The Audit Committee is composed of
Board members who are not officers, employees or affiliates of the Company or
its subsidiaries. The Audit Committee, which consists of Messrs. Belleville,
Lawrence, and Richard Mascuch (who is not standing for re-election), held two
meetings during fiscal 1995.
The Nominating Committee establishes the criteria for and reviews the
qualifications of individuals for nomination to the Board of Directors and to
committees of the Board. In addition, the Nominating Committee presents
recommendations for replacement directors when vacancies occur on the Board or
committees thereof. The Nominating Committee may consider nominees recommended
by stockholders. This committee, which presently consists of Messrs. Berthelot,
Chema and Lawrence, held three meetings during the fiscal year ended March 31,
1995.
The Compensation and Incentives Committee reviews management's proposals and
makes recommendations to the full Board for compensation and incentives for key
employees and officers of the Company. This committee is comprised solely of
directors who are not eligible to receive cash bonuses or any other type of
incentive compensation. The Compensation and Incentives Committee, which
presently consists of Messrs. Belleville, Chema and Dr. H. Gary Carlson (who is
not standing for re-election), held three meetings during the fiscal year ended
March 31, 1995.
MEETINGS AND REMUNERATION
During the fiscal year ended March 31, 1995, the Board of Directors held nine
meetings. Each incumbent director attended at least 75% of the aggregate of (i)
the total number of meetings held by the Board of Directors during fiscal 1995
(held during the period for which he has been a director) and (ii) the total
number of meetings held by all Committees of the Board of Directors on which he
served during that period.
The Company pays its non-employee directors a $5,000 annual retainer and $2,500
for each Board of Directors meeting attended. Meeting fees are also paid for
attendance via conference telephone if such meetings last longer than thirty
minutes. Directors are paid their $5,000 annual retainer in Company Common Stock
rather than cash. In addition, each non-employee director is granted a Stock
Option to purchase the same number of shares that he owned on (a) the date that
is sixty days after
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his election to the Board if that date occurs after September 11, 1994, or (b)
on September 12, 1994 if the director had served on the Board prior to that
date. In addition, the Company reimburses its directors for expenses incurred on
behalf of the Company. Non-employee directors are also paid a retainer (in
Company Stock) for serving on committees and fees (in cash) for attending
committee meetings. Annual retainers for the Chairmen of the Audit Committee and
of the Compensation and Incentives Committee are $4,200 while for other members
they are $3,000. Attendance at meetings of these committees is compensated at
$800 per meeting. The Chairman of the Nominating Committee receives a $3,700
annual retainer while the non-employee committee member receives $2,500.
Attendance at Nominating Committee meetings is compensated at $900 per meeting.
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SECURITY OWNERSHIP OF PRINCIPAL
STOCKHOLDERS, NOMINEES FOR
DIRECTOR AND OFFICERS
The following table sets forth certain information regarding the beneficial
ownership of the Common Stock as of May 30, 1995 (except as set forth in the
footnotes) by (i) each person who is known by the Company to be the beneficial
owner of more than 5% of the Common Stock, (ii) each director and nominee for
director of the Company, individually, (iii) each executive officer of the
Company, individually, and (iv) all directors and executive officers as a group:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
NUMBER OF
SHARES OF PERCENTAGE OF
NAME COMMON STOCK(1) COMMON STOCK(1)
<S> <C> <C>
-----------------------------------------------------------------------------------------------
Arch C. Scurlock 1,146,740(2) 21.7
c/o Research Industries, Incorporated
123 North Pitt Street
Alexandria, Virginia 22314
Heine Securities Corporation 361,000(3) 6.8
51 J.F.K. Parkway
Short Hills, New Jersey 07078
Dimensional Fund Advisors Inc. 303,400(4) 5.8
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
Kennedy Capital Management, Inc. 313,325(5) 5.9
425 N. New Ballas Rd. #181
St. Louis, MO 63141-6821
Michael J. Berthelot 354,474(6) 6.7
Patrick K. Bolger 52,587(7) 1.0
Chandler J. Moisen 24,279(8) *
Valentina Doss 7,638(9) *
Gideon Argov 10,000 *
Walter Belleville 3,000 *
Richard Mascuch 22,272 *
Thomas V. Chema 714 *
H. Gary Carlson 2,850 *
James A. Lawrence 26,083 *
Directors and executive officers as a group
(10 persons) 439,178(10) 8.3
-----------------------------------------------------------------------------------------------
</TABLE>
* Less than 1%.
(1) Except as set forth in these footnotes, the persons named in this table have
sole voting power and investment power with respect to all shares of capital
stock shown as beneficially owned by them, subject to community property
laws where applicable and the information contained in this table and these
notes.
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(2) Includes 1,100,000 shares of Common Stock owned by Research Industries,
Incorporated, of which Dr. Scurlock owns 95% of the outstanding shares of
stock.
(3) According to a February 8, 1995 filing on Schedule 13G with the Securities
and Exchange Commission, Heine Securities Corporation and Michael F. Price
exercise voting control and dispositive power over all 361,000 shares.
Heine Securities Corporation is a registered investment advisor and Mr.
Price is its President. They disclaim beneficial ownership of all such
shares.
(4) Based on a January 31, 1995 filing on Schedule 13G with the Securities and
Exchange Commission, the Dimensional Fund Advisors Inc. ("Dimensional")
owned this amount of shares of Common Stock as of December 31, 1994.
Dimensional, a registered investment advisor, is deemed to have beneficial
ownership of this amount of shares of Common Stock at such date, all of
which shares are held in portfolios of DFA Investment Dimensions Group
Inc., a registered open-end investment company, or in series of the DFA
Investment Trust Company, a Delaware business trust, or the DFA Group Trust
and DFA Participation Group Trust, investment vehicles for qualified
employee benefit plans, all of which Dimensional Fund Advisors Inc. serves
as investment manager. Dimensional disclaims beneficial ownership of such
shares.
(5) Based on information supplied by Kennedy Capital Management, Inc. as of
March 14, 1995.
(6) Includes 59,996 shares issuable with respect to options exercisable within
60 days of May 30, 1995.
(7) Includes 42,157 shares issuable with respect to options exercisable within
60 days of May 30, 1995.
(8) Includes 9,999 shares issuable with respect to options exercisable within
60 days of May 30, 1995.
(9) Includes 5,833 shares issuable with respect to options exercisable within
60 days of May 30, 1995.
(10) Includes 117,985 shares issuable with respect to options exercisable within
60 days of May 30, 1995.
EXECUTIVE OFFICERS, COMPENSATION AND OTHER INFORMATION
EXECUTIVE OFFICERS
Set forth in the table below are the names, ages and positions held by all
executive officers of the Company.
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
EXECUTIVE
POSITION WITH OFFICER
NAME THE COMPANY AGE SINCE
<S> <C> <C> <C>
--------------------------------------------------------------------------------------------------
Michael J. Berthelot Chairman of the Board of Directors and Chief 45 1992
Executive Officer
Patrick K. Bolger President, Chief Operating Officer 60 1990
and Director
Chandler J. Moisen Senior Vice President, Chief Financial Officer 61 1991
and Treasurer
Valentina Doss Vice President, General Counsel and Secretary 44 1991
---------------------------------------------------------------------------------------------------
</TABLE>
Executive officers of the Company are elected by and serve at the discretion of
the Board of Directors. No arrangement exists between any executive officer and
any other person or persons pursuant to which any executive officer was or is to
be selected as an executive officer. None of the executive officers has any
family relationship to any nominee for director or to any other executive
officer of the Company. Set forth below is a brief description of the busi-
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ness experience for the previous five years of those executive officers who are
not also directors. For information concerning the business experience of
Messrs. Berthelot and Bolger, see "Information Concerning Incumbent Directors
and Nominees to the Board of Directors."
MR. MOISEN has served as Vice President, Treasurer and Chief Financial Officer
of the Company since August 1991 and as Senior Vice President since October
1992. From August to October 1992 Mr. Moisen served as one of three executive
officers in the Company's Office of the President. From 1989 to 1991, Mr. Moisen
served as Senior Vice President and Chief Financial Officer of G-Tech Corp., a
computer hardware and software manufacturer.
MS. DOSS served the Company as Vice President of Administration from August 1991
to September 1993, as Vice President and General Counsel since September 1993
and as Secretary since December 1991. Prior to that time she served as the
Company's Senior Counsel and Assistant Secretary since 1988 and as Associate
Legal Counsel from 1983 to 1988.
EXECUTIVE COMPENSATION
The following table sets forth information concerning the annual and long-term
compensation for services in all capacities to the Company for the fiscal years
ended March 31, 1995, 1994 and 1993, of those persons who were, at March 31,
1995 (i) the chief executive officer and (ii) the other executive officers of
the Company who received in excess of $100,000 in total annual salary and bonus
for fiscal 1995. During each fiscal year in the three year period ended March
31, 1995, no executive officer named above received perquisites and other
personal benefits, securities or property in an aggregate amount in excess of
the lesser of $50,000 or 10% of such executive officer's annual salary and
bonus.
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SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
LONG TERM
COMPENSATION
---------------------------------
AWARDS
ANNUAL COMPENSATION ----------
----------------------------------------- RESTRICTED SECURITIES PAYOUTS
OTHER ANNUAL STOCK UNDERLYING ------- ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARDS OPTIONS LTIP COMPENSATION
PRINCIPAL POSITION YEAR (1) (2) (3) (4) (#) PAYOUTS (5)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------------------
Michael J. Berthelot 1995 $295,000 $204,007 -- 4,383 60,000 -- $ 30,761(6)
Chairman and Chief 1994 295,000 137,088 $ 41,931 -- 60,000 -- 20,824
Executive Officer 1993 212,308 194,800 -- -- -- -- 2,832
Patrick K. Bolger 1995 185,000 136,005 -- 2,922 40,000 -- 12,035
President and Chief 1994 185,000 91,392 28,337 2,127 40,000 -- 14,242
Operating Officer 1993 175,573 81,581 -- -- -- -- 11,539
Chandler J. Moisen 1995 175,000 113,337 -- 2,631 15,000 -- 11,418
Senior Vice 1994 175,000 78,872 30,334 2,127 15,000 -- 13,796
President and Chief 1993 167,212 80,858 -- -- -- -- 252,890(7)
Financial Officer
Valentina Doss 1995 110,800 48,170 -- 1,388 10,000 -- 7,906
Vice President, 1994 110,800 41,521 16,078 1,509 7,500 -- 8,273
General Counsel and 1993 98,339 55,287 -- -- -- -- 79,993(8)
Secretary
--------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Amounts shown include compensation earned and received by executive officers
as well as amounts earned but deferred at the election of those officers
under the Company's 401(K) plan.
(2) Represents payments made to executive officers pursuant to the Company's
Incentive Compensation Plan.
(3) Fiscal 1994 amounts represent (i) fair market value on date of award of
unrestricted stock awards and (ii) dividends paid on restricted stock not
yet vested.
(4) An aggregate of 15,166 shares of restricted shares were held for the benefit
of the executive officers at fiscal year-end. Such shares vest in annual
increments of one-third each year. The executive officer receives dividends
on issued but unvested shares.
(5) These amounts include the Company's contributions to the Retirement Savings
Plan and insurance premiums paid by the Company under the Company's group
benefits plan.
(6) The amount includes relocation expenses of $20,000 paid to Mr. Berthelot.
(7) The amount includes relocation expenses of $245,538 paid on behalf of Mr.
Moisen.
(8) The amount includes relocation expenses of $73,407 paid on behalf of Ms.
Doss.
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Incentive Compensation Plans. The Fiscal Year 1995 Incentive Compensation Plan
(the "Incentive Compensation Plan") provides for the award of cash bonuses from
profits based upon operating results. Results are measured by a wide range of
goals which must be met, including goals for operating income, return on
investment, individual strategic and/or operational issues, cash flow and annual
income growth. The stock feature of the Incentive Compensation Plan provides for
the award of restricted stock and stock options to corporate officers, division
presidents and other key personnel. The number of restricted shares awarded is
equal to shares that could be purchased at the closing price of the stock on the
date the Board of Directors approved the Plan with 25% of the cash bonus pool.
Voting and dividend rights vest immediately. Restrictions on sale lapse over
three years in annual one-third increments. Shares for which restrictions have
not yet expired are forfeited upon termination of employment. Stock options are
awarded at an exercise price equal to the fair market value of the shares on the
date of grant. Options become exercisable in annual equal installments over
three years and expire five years after grant date. Both restricted stock and
stock options are awarded pursuant to the 1992 Long Term Incentive Plan, which
provides the mechanism for awarding various kinds of stock based awards.
Retirement Plans. The Company maintains four retirement plans covering
substantially all active U.S. employees, two of which are defined contribution
plans and one of which is a defined benefit plan. The TransTechnology
Corporation Retirement Savings Plan (the "Retirement Savings Plan"), a defined
contribution plan under Section 401(k) of the Internal Revenue Code, covers
non-union employees who have been employed by the Company for more than one
year. Approximately 700 employees participate in the Retirement Savings Plan.
Benefits are payable on retirement, disability, death, or other separation from
service. Participants in the Retirement Savings Plan may defer receipt and
taxation of up to 15% of their compensation by contributing such compensation to
the plan. The Company contributes a minimum of 3% and a maximum of 6% of
employees' compensation to the Retirement Savings Plan, depending on the level
of contribution by each employee. The other three plans cover approximately 450
members of collective bargaining units.
Executive Life Insurance Plan. The Company maintains life insurance policies
for its executive officers which supplement the group life policies available to
all salaried employees.
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STOCK OPTIONS
The following table sets forth information concerning options granted to those
persons who were the chief executive officer and the other executive officers of
the Company during fiscal 1995.
OPTION/SAR GRANTS IN FISCAL 1995
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS
---------------------------------------------------------------------------------------------------
% OF POTENTIAL
TOTAL REALIZABLE VALUE
OPTIONS/ OF ASSUMED ANNUAL
SARS EXERCISE RATES OF STOCK
OPTIONS/ GRANTED TO OR BASE PRICE APPRECIATION
SARS EMPLOYEES PRICE EXPIRA- FOR OPTION TERM
GRANTED IN FISCAL $ PER TION ------------------
NAME (#)(1) YEAR SHARE DATE 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------
Michael J. Berthelot 60,000 35 15.125 4-21-99 257,733 588,612
Patrick K. Bolger 40,000 23 15.125 4-21-99 171,822 392,408
Chandler J. Moisen 15,000 9 15.125 4-21-99 64,433 147,153
Valentina Doss 10,000 6 15.125 4-21-99 42,956 98,102
---------------------------------------------------------------------------------------------------
</TABLE>
(1) Amounts shown represent stock options only. No stock appreciation rights
(SARs) were awarded.
The following table summarizes option exercises during fiscal 1995 and the total
number and value of exercisable and unexercisable stock options held by each of
the named executive officers on March 31, 1995, the last day of fiscal 1995.
AGGREGATED OPTION/SAR EXERCISES IN FISCAL 1995 AND
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS
AT FY-END(#) AT FY-END($)
-------------- --------------------
SHARES ACQUIRED ON EXERCISABLE/ EXERCISABLE/
NAME EXERCISE VALUE REALIZED UNEXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------
Michael J. Berthelot -- -- 19,998/100,002 34,997/70,004
Patrick K. Bolger -- -- 16,247/66,668 32,786/46,669
Chandler J. Moisen 8,334 $ 27,586 0/25,000 0/17,500
Valentina Doss 6,357 $ 26,690 0/15,000 0/8,750
-------------------------------------------------------------------------------------------------------
</TABLE>
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The following table sets forth information concerning long-term incentive plan
awards in the form of restricted stock awarded during fiscal 1995 to the chief
executive officer and the other executive officers of the Company.
LONG-TERM INCENTIVE PLAN AWARDS IN FISCAL 1995(1)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
PERFORMANCE
NUMBER OF OR OTHER
SHARES, UNITS PERIOD UNTIL
OR OTHER MATURATION
NAME RIGHTS(#) OR PAYOUT
<S> <C> <C>
-----------------------------------------------------------------------------------------------
Michael J. Berthelot 3,849 3 years
Patrick K. Bolger 2,566 3 years
Chandler J. Moisen 2,138 3 years
Valentina Doss 909 3 years
-----------------------------------------------------------------------------------------------
</TABLE>
(1) Restricted stock awards are calculated based upon a cash bonus pool, which
is itself based upon annual profit. The number of restricted shares awarded
is equal to shares that could be purchased at $13.25 (the closing price of
the stock on the date of the award) with 25% of the cash bonus pool. The
cash bonus is described on page 10.
REPORT OF THE COMPENSATION AND INCENTIVES COMMITTEE OF THE BOARD OF DIRECTORS
The Compensation and Incentives Committee of the Board of Directors (the
"Committee") is composed entirely of independent outside directors. The
Committee is responsible for establishing policies and implementing programs
relating to executive compensation. All decisions of the Committee relating to
compensation of the Company's executive officers are reviewed by the entire
Board of Directors, except for decisions relating to stock based awards, which
must be made solely by the Committee in order for the grants or awards to
satisfy Rule 16b-3 of the Securities Exchange Act of 1934.
The Committee's philosophy regarding executive compensation is that a
compensation program should (i) support the achievement of desired Company
performance; (ii) provide compensation that will attract and retain qualified
executives and reward performance; (iii) align the executive officers' interests
with shareholders' interests as well as the overall success of the Company by
placing a portion of pay at risk; and (iv) encourage management's stake in the
long-term performance and success of the Company.
For Fiscal Years 1993-1995, a form of Annual Incentive Plan was adopted
consistent with this philosophy. The compensation reflected in this proxy
statement is the result of that program and will be described here briefly. A
new plan has been adopted for Fiscal Years 1996-1998 which is also consistent
with this philosophy but is intended to more directly align the focus and
remuneration of both divisional and corporate management with that of the
Company's shareholders.
The methodology for setting base salary of the executive officers remains
unchanged and consists of (i) determining marketplace compensation by comparing
the corporation to groups of other corporations with similar characteristics and
(ii) evaluating each executive's performance as well as the performance of the
Company as a whole. Each year the perform-
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<PAGE> 15
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ance of executive officers and division presidents is evaluated by his or her
supervisor. The evaluation is based upon individualized performance objectives
designated at the beginning of the fiscal year and at the time of the last
performance evaluation.
The bonus portion of the executive officers' compensation program is an
important tool in providing incentive both for short-term and long-term
performance. Cash and restricted stock awards are paid upon achieving or
exceeding target levels of quantitative performance measures. Such performance
measures are tied directly to the Company's annual
business plan. Executive officers, including Mr. Berthelot, earn no bonus unless
100% of the business plan's profit goals are met. The business plan is prepared
and approved prior to the start of the fiscal year. Under the prior plan, a
portion of the bonus was also paid in unrestricted stock. The new plan has
eliminated unrestricted stock awards, but continues to pay a portion of the
bonus in restricted stock. The plan for executive officers and division
presidents measures performance factors against targets for before-tax-profits,
profit growth, return on investment, cash flow, meeting budgets and achievement
of individual performance objectives. The new plan has added productivity growth
as an additional factor for measuring performance. The enhancement paid for
meeting certain targets in consecutive years under the prior plan has been
discontinued in the new plan.
In addition to the restricted and unrestricted stock awards described above,
executive officers and division presidents receive incentive stock options.
Stock options are based upon marketplace compensation studies and are awarded
individually each year at an exercise price equal to the stock's fair market
value on date of grant. Stock options vest over a three-year period and have
never been repriced.
In order to directly align the focus and remuneration of senior managers with
that of the shareholders, the Committee and the Board of Directors decided to
decrease the proportionate share of bonuses earned for a single year's
performance and to increase the portion that can be earned only by achieving
long term increases in shareholder value. The new plan's purpose is to recognize
the achievement of above average results in the current fiscal year and to
reward the creation of increased value of the entity (as determined by the
markets and as shared with the shareholders) over the long term. This portion of
the cash bonus will be paid at the end of a three-year period based upon the
increase in the enterprise value of the company, or a division of the company,
as the case may be, which exceeds a compounded rate of 12% per annum. (The 12%
per annum hurdle rate was established to represent the overall return an
investor would seek at the beginning of the three-year measuring period.) It is
the purpose of the Committee and the Board in implementing this new feature of
the senior managers' incentive compensation program to encourage and reward long
term growth in the value of the Company.
Mr. Berthelot's compensation, including base compensation, cash bonus and stock
awards is determined by the same methodology as described above for all
executive officers. His performance is evaluated in an annual process by the
outside members of the Board of Directors.
WALTER BELLEVILLE
H. GARY CARLSON
THOMAS V. CHEMA
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<PAGE> 16
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COMPANY PERFORMANCE
The following graph shows a comparison of cumulative total returns for the
Company, Standard & Poor's 500 Index and a Company-constructed Peer Group Index
(consisting of public companies which manufacture products that compete with the
Company's products) for the last five fiscal years. Total returns are based on
market capitalization. Peer group indices use beginning of period market
capitalization weighting. Total return assumes reinvestment of dividends.
COMPARISON OF CUMULATIVE TOTAL RETURN*
<TABLE>
<CAPTION>
MEASUREMENT PERIOD TRANS-
(FISCAL YEAR COVERED) TECHNOLOGY S&P PEER GROUP
<S> <C> <C> <C>
1990 100.00 100.00 100.00
1991 77.42 114.41 101.41
1992 72.88 127.05 138.02
1993 109.77 146.39 145.32
1994 164.14 148.55 189.65
1995 123.06 171.60 205.00
</TABLE>
* ASSUMES INITIAL INVESTMENT OF $100.
Peer Group includes: Stant, ITW, Eaton Co., Park-Ohio Industries and Black &
Decker.
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<PAGE> 17
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COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and certain of its officers, and persons who own more than 10 percent
of a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "SEC"). Officers, directors and greater than 10 percent stockholders are
required by SEC regulation to furnish the Company with copies of all Section
16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that from April 1, 1994 to
March 31, 1995, all filing requirements applicable to its officers, directors
and greater than 10 percent beneficial owners were complied with except for
filings which were made late by Mr. Belleville (Form 4 filed December 14, 1994
to reflect purchase on October 17, 1992), Mr. Moisen (Form 4 filed September 14,
1994 to reflect exercise of options and sale of stock between August 11 and
August 24, 1994) and Mr. Argov (Form 3 filed March 16, 1995 to report stock
ownership as of date of appointment to the Board, March 3, 1995).
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
H. Gary Carlson, a current director who is not standing for re-election, has
provided consulting services to the Company during fiscal 1994 and fiscal 1995
through GATH Industries, Inc., a consulting company of which he is President and
a director. GATH Industries specializes in business formations and turnarounds.
In fiscal 1995, the Company paid $2,400 to GATH Industries for consulting
services rendered in connection with the Company's Electronics Division
("Electronics") and Electronic Connections and Assemblies Inc. subsidiary
("ECA"). In April 1995 Dr. Carlson entered into a letter of intent with the
Company which contemplates the Company's sale of assets relating to the
Electronics business, the ECA business and a weather instrument product line, to
a company controlled by Dr. Carlson. The aggregate purchase price for the three
businesses is contemplated to be approximately $16 million plus assumption of
certain liabilities, which aggregate approximately $2 million. Payment is
contemplated by $5 million in cash and the balance by a subordinated promissory
note. The transaction is expected to close on August 15, 1995, at which time,
Dr. Carlson will resign from the Board of Directors.
PROPOSAL 2 -- RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors unanimously recommends the ratification of its selection
of Deloitte & Touche to serve as independent accountants of the Company for the
current fiscal year, which ends March 31, 1996. Deloitte & Touche has served as
independent accountants for the Company continuously since 1967. The Board has
been advised that Deloitte & Touche is independent with respect to the Company
within the meaning of the Securities Act of 1933, as amended, and the applicable
published rules and regulations thereunder. A representative from Deloitte and
Touche is
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<PAGE> 18
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expected to attend the Meeting to make a statement should they desire to do so
and be available to respond to appropriate questions. Ratification of the
appointment requires the affirmative vote of a majority of the votes cast at the
Meeting. The Board of Directors unanimously recommends a vote FOR ratification.
PROPOSALS FOR SUBMISSION AT NEXT ANNUAL MEETING
If a stockholder desires to submit a proposal to fellow stockholders at the
Company's annual meeting next year and wishes to have it set forth in the
corresponding proxy statement and identified in the corresponding form of proxy
prepared by management, such stockholder must notify the Company at its
executive offices no later than April 11, 1996.
ANNUAL REPORTS
A copy of the Company's Annual Report for the fiscal year ended March 31, 1995
is being mailed to each stockholder of record together with this Proxy
Statement. On July 11, 1995, the Company filed with the SEC its Annual Report on
Form 10-K for the fiscal year ended March 31, 1995. This Report contains
detailed information concerning the Company and its operations, supplementary
financial information and certain schedules which are not included in the Annual
Report to Stockholders. A COPY OF THIS REPORT, WITHOUT EXHIBITS, WILL BE
FURNISHED TO STOCKHOLDERS WITHOUT CHARGE UPON REQUEST IN WRITING TO VALENTINA
DOSS AT TRANSTECHNOLOGY CORPORATION, 700 LIBERTY AVENUE, UNION, NEW JERSEY
07083. If requested, the Company will also provide such persons with copies of
any exhibit to the Annual Report on Form 10-K upon the payment of a fee limited
to the Company's reasonable expenses in furnishing such exhibits. Such Report is
not a part of the Company's soliciting material.
OTHER MATTERS
The Board of Directors does not know of any matter to be acted upon at the
Meeting other than the matters described herein. If any other matter properly
comes before the Meeting, the holders of the proxies will vote thereon in
accordance with their best judgment.
By Order of the Board of Directors
[SIG]
VALENTINA DOSS
Vice President, General Counsel and Secretary
Union, New Jersey
August 9, 1995
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16
<PAGE> 19
PROXY
TRANSTECHNOLOGY CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Michael J. Berthelot, Chandler J. Moisen and
Monica Aguirre, or any two of them, as Proxy, each with the power to appoint
his substitute, and hereby authorizes them to represent and to vote as
designated below, all the shares of common stock of TransTechnology Corporation
held of record by the undersigned on July 24, 1995, at the annual meeting of
shareholders to be held on September 21, 1995, or any adjournment thereof. This
proxy when properly executed will be voted in the manner directed herein by the
undersigned shareholder. If no direction is made, this proxy will be voted
FOR the election of all of the nominees and FOR the appointment of
Deloitte & Touche LLP. This proxy when properly executed will be voted in the
discretion of the Proxy upon such other business as may properly come before
the meeting.
1) ELECTION OF DIRECTORS
/ / FOR ALL NOMINEES listed below / / WITHHOLD AUTHORITY to vote
(except as written in the space below). for all nominees listed
below.
Gideon Argov, Walter Belleville, Michael J. Berthelot, Patrick K. Bolger,
Thomas V. Chema, James A. Lawrence
INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.
----------------------------------------------------------------
The undersigned hereby confer(s) upon the Proxy discretionary authority with
respect to the election of Directors in the event that any of the above
nominees is unable or unwilling to serve at the meeting.
2) Proposal to ratify the selection of Deloitte & Touche LLP as auditors for
the fiscal year ending March 31, 1996.
/ / FOR / / AGAINST / / ABSTAIN
3) In its discretion, the Proxy is authorized to vote upon such other business
as may properly come before the meeting.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY CARD IN THE
ENCLOSED PREPAID ENVELOPE
(Continued and to be signed on other side)
<PAGE> 20
(Continued from the other side)
PROXY - SOLICITED BY THE BOARD OF DIRECTORS
Please sign exactly as your name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in the full corporate name by the President or other authorized officer.
If a partnership, please sign in the partnership name by an authorized person.
------------------------------------------
Signature
------------------------------------------
Signature if held jointly
Dated: , 1995
------------------------------
Please mark, sign, date and return this proxy card promptly using the enclosed
envelope which requires no postage if mailed in the United States.
