o Preliminary Proxy Statement | ||
o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | ||
þ Definitive Proxy Statement | ||
o Definitive Additional Materials | ||
o Soliciting Material Pursuant to Section 240.14a-12 |
þ | No fee required. |
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which transaction applies: |
(2) | Aggregate number of securities to which transaction applies: |
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
(4) | Proposed maximum aggregate value of transaction: |
(5) | Total fee paid: |
o | Fee paid previously with preliminary materials. |
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
(1) | Amount Previously Paid: |
(2) | Form, Schedule or Registration Statement No.: |
(3) | Filing Party: |
(4) | Date Filed: |
1. To elect three Directors. | |
2. To ratify the selection of Deloitte & Touche LLP as our independent auditors for our fiscal year ending March 31, 2006. | |
3. To transact such other business as may properly come before the annual meeting or any adjournment of the annual meeting. |
BY ORDER OF THE BOARD OF DIRECTORS |
WILLIAM C. JOHNSON | |
President & Chief Executive Officer |
• | To elect three Directors. | |
• | To approve the selection of Deloitte & Touche LLP as our independent auditors for our fiscal year ending March 31, 2006 (“Fiscal Year 2006”). | |
• | To transact such other business as may properly come before the annual meeting or any adjournment of the annual meeting. |
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• | delivering to our corporate secretary a written notice of revocation prior to the annual meeting; | |
• | delivering to our corporate secretary a duly executed proxy bearing a later date; or | |
• | attending the annual meeting and filing a written notice of revocation with our corporate secretary and voting in person. |
• | each person who is known to us, based on reports filed with the Securities and Exchange Commission, to own beneficially more than 5% of our common stock; | |
• | each of our “named executive officers” as of that date (See “Executive Compensation” on page 10); | |
• | each of our Directors and Director nominees who beneficially owns shares of our common stock; and | |
• | all of our executive officers and Directors as a group. |
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Common Stock Beneficially Owned | ||||||||
Number of | Percentage of | |||||||
Name of Beneficial Owner | Shares | Class | ||||||
Employee Stock Ownership Plan of Graham Corporation | 100,936 | (3) | 5.8 | % | ||||
Dimensional Fund Advisors, Inc. | 91,768 | (4) | 5.3 | % | ||||
Van Den Berg Management | 146,580 | (5) | 8.5 | % | ||||
Helen H. Berkeley(1) | 122,307 | (6) | 7.0 | % | ||||
Jerald D. Bidlack(1) | 31,250 | (7) | 1.8 | % | ||||
William C. Denninger(1) | 4,250 | (8) | * | |||||
J. Ronald Hansen(2) | 12,920 | (9) | * | |||||
William C. Johnson(1)(2) | 18,000 | (10) | 1.0 | % | ||||
H. Russel Lemcke(1) | 38,000 | (11) | 2.2 | % | ||||
James R. Lines(2) | 14,314 | (12) | * | |||||
James J. Malvaso(1) | 4,250 | (13) | * | |||||
Stephen P. Northrup(2) | 25,555 | (14) | 1.5 | % | ||||
Cornelius S. Van Rees(1) | 21,050 | (15) | 1.2 | % | ||||
All executive officers and Directors as a group (10 persons) | 291,896 | (16) | 15.8 | % |
* | Less than 1%. | |
(1) | Director. | |
(2) | Executive officer. | |
(3) | The Employee Benefits Committee of our Board of Directors administers the Employee Stock Ownership Plan of Graham Corporation (the “ESOP”). The Board of Directors has appointed an unrelated corporate trustee for the ESOP. The Employee Benefits Committee instructs the ESOP trustee regarding investment of funds contributed to the ESOP. Each member of the Employee Benefits Committee disclaims beneficial ownership of the shares held in the ESOP. The ESOP trustee must vote all allocated shares held in the ESOP in accordance with the instructions of the participating employees. Unallocated shares held in the suspense account are voted by the ESOP trustee in a manner calculated to most accurately reflect the instructions the ESOP trustee has received from participants regarding the allocated stock, provided such instructions do not conflict with the ESOP trustee’s fiduciary obligations under ERISA. As of June 10, 2005, all 100,936 shares were allocated to participants under the ESOP and no shares were unallocated. | |
(4) | Dimensional Fund Advisors, Inc.’s address is 1299 Ocean Avenue, 11th Floor, Santa Monica, California 90401. Dimensional Fund Advisors, Inc., an investment advisor registered under Section 203 of the Investment Advisors Act of 1940, is deemed to have beneficial ownership of 91,768 shares of our stock as of December 31, 2004, all of which shares are held in the portfolios of four investment companies, each of which is registered under the Investment Company Act of 1940. Dimensional Fund Advisors, Inc. furnishes investment advice to each of the four investment companies but disclaims beneficial ownership of all of the shares held by the investment companies and reported in the table above. | |
(5) | Van Den Berg Management’s address is 805 Las Cimas Parkway, Suite 430, Austin, Texas 78746. | |
(6) | Includes 15,000 shares that Mrs. Berkeley may acquire within 60 days upon exercise of stock options. | |
(7) | Includes 12,000 shares that Mr. Bidlack may acquire within 60 days upon exercise of stock options. | |
(8) | Includes 4,250 shares that Mr. Denninger may acquire within 60 days upon exercise of stock options. | |
(9) | Includes 4,200 shares that Mr. Hansen may acquire within 60 days upon exercise of stock options and 720 shares held by the ESOP trustee and allocated to Mr. Hansen’s account, as to which Mr. Hansen has sole voting power but no dispositive power, except in limited circumstances. | |
(10) | Includes 18,000 shares that Mr. Johnson may acquire within 60 days upon exercise of stock options. | |
(11) | Includes 20,000 shares that Mr. Lemcke may acquire within 60 days upon exercise of stock options. | |
(12) | Includes 13,200 shares that Mr. Lines may acquire within 60 days upon exercise of stock options and 1,114 shares held by the ESOP trustee and allocated to Mr. Lines’s account, as to which Mr. Lines has sole voting power but no dispositive power, except in limited circumstances. |
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(13) | Includes 4,250 shares that Mr. Malvaso may acquire within 60 days upon exercise of stock options. |
(14) | Includes 16,200 shares that Mr. Northrup may acquire within 60 days upon exercise of stock options and 1,355 shares held by the ESOP trustee and allocated to Mr. Northrup’s account, as to which Mr. Northrup has sole voting power but no dispositive power, except in limited circumstances. |
(15) | Includes 12,000 shares that Mr. Van Rees may acquire within 60 days upon exercise of stock options. |
(16) | See footnotes 6 through 15 to this table. Includes 119,100 shares that members of the group may acquire within 60 days upon exercise of stock options and 3,189 shares allocated to the named executive officers under the ESOP, as to which the named executive officers may exercise voting power, but not dispositive power, except in limited circumstances. |
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Name and Background | Director Since | Term Expires | ||||||
William C. Denninger,age 54, has served as Senior Vice President-Finance and Chief Financial Officer of Barnes Group, Inc. in Bristol, Connecticut, since 2000. Before joining Barnes, and from 1993 to 2000, he served as Vice President-Finance and Chief Financial Officer of BTR, Inc. in Stamford, Connecticut. | 2003 | 2005 | ||||||
H. Russel Lemcke,age 65, has served as President of H. Russel Lemcke Group, Inc., which specializes in strategic business development, including mergers, acquisitions and joint ventures, since 1990. Mr. Lemcke serves as a board member of Sensus Metering Systems, Inc., in Raleigh, North Carolina. Sensus is a global manufacturer of utility metering products and systems. | 1996 | 2005 | ||||||
Cornelius S. Van Rees,age 76, was a partner in the New York City law firm of Thacher Proffitt & Wood until his retirement in 1994. Mr. Van Rees received his law degree in 1954 from Columbia University. He serves as Secretary of the Company. | 1969 | 2005 |
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Name and Background | Director Since | Term Expires | ||||||
Helen H. Berkeley,age 76, is a private investor. | 1998 | 2006 | ||||||
Jerald D. Bidlack,age 69, has served as President of Griffin Automation, Inc., a manufacturer of special automation machinery and systems located in West Seneca, New York, since 1992. He serves also as a trustee of Keuka College, which is located in Penn Yan, New York. | 1985 | 2007 | ||||||
William C. Johnson,age 42, is our President and Chief Executive Officer. Before joining us in November 2004, Mr. Johnson had served since October 1999 as Senior Vice President and General Manager of ESAB Welding and Cutting Equipment, a manufacturer of welding equipment and cutting machines. In this capacity, Mr. Johnson was responsible for operations comprising $100 million in annual sales. | 2004 | 2006 | ||||||
James J. Malvaso,age 55, has served as President and Chief Executive Officer of The Raymond Corporation, located in Greene, New York, since 1997. Previously, and from 1993 to 1996, he served as Chief Operating Officer and Vice President-Operations of Raymond. He serves also as a trustee of Lemoyne College, which is located in Syracuse, New York. | 2003 | 2007 |
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Long-Term | ||||||||||||||||||||||||
Annual Compensation | Compensation | |||||||||||||||||||||||
Other Annual | Securities | All Other | ||||||||||||||||||||||
Fiscal | Salary | Bonus | Compensation | Underlying | Compensation | |||||||||||||||||||
Name and Principal Position | Year | ($)(1) | ($)(2) | ($) | Options/SARs(#) | $(3)(4)(5)(6)(7)(8)(9) | ||||||||||||||||||
William C. Johnson | 2005 | 80,140 | (10) | –0– | –0– | 18,000 | 125,338 | |||||||||||||||||
President and | 2004 | — | — | — | — | — | ||||||||||||||||||
Chief Executive Officer | 2003 | — | — | — | — | — | ||||||||||||||||||
J. Ronald Hansen | 2005 | 146,931 | –0– | 31,816 | (11) | 3,000 | –0– | |||||||||||||||||
Vice President — Finance & | ||||||||||||||||||||||||
Administration and | 2004 | 146,931 | –0– | 23,387 | (11) | 3,000 | 86,475 | |||||||||||||||||
Chief Financial Officer | 2003 | 146,931 | –0– | –0– | 3,000 | 14,050 | ||||||||||||||||||
James R. Lines | 2005 | 137,966 | –0– | 12,109 | (11) | 3,000 | 14,762 | |||||||||||||||||
Vice President and | 2004 | 137,966 | –0– | 8,606 | (11) | 3,000 | 43,132 | |||||||||||||||||
General Manager | 2003 | 137,966 | –0– | –0– | 3,000 | 7,442 | ||||||||||||||||||
Stephen P. Northrup | 2005 | 137,966 | –0– | –0– | 3,000 | 41,476 | ||||||||||||||||||
Vice President and | 2004 | 137,966 | –0– | 25,558 | (11) | 3,000 | 86,960 | |||||||||||||||||
Chief Technology Officer | 2003 | 137,966 | –0– | –0– | 3,000 | 6,054 | ||||||||||||||||||
Alvaro Cadena | 2005 | 176,233 | –0– | 58,175 | (11) | –0– | 98,714 | |||||||||||||||||
Retired President | 2004 | 234,978 | –0– | –0– | 6,000 | 113,160 | ||||||||||||||||||
and Chief Executive Officer | 2003 | 234,978 | –0– | –0– | 6,000 | 14,050 | ||||||||||||||||||
Philip Marks | 2005 | 108,593 | –0– | 63,558 | (11) | 3,000 | 46,157 | |||||||||||||||||
Former Vice President — | 2004 | 120,922 | –0– | –0– | 3,000 | 4,010 | ||||||||||||||||||
Manufacturing | 2003 | 118,456 | –0– | –0– | 3,000 | 7,540 |
(1) | The figures shown include amounts (if any) deferred by the named executive officers pursuant to section 401(k) of the Internal Revenue Code as deferred contingent salary. Amounts deferred under section 401(k) of the Internal Revenue Code are deposited in the named executive officer’s 401(k) account for investment and payment according to the terms of our Incentive Savings Plan. |
(2) | Bonus amounts are deferred to the following fiscal year and are contingent upon attainment of predetermined performance goals. No bonus was paid to any named executive officer with respect to Fiscal Years 2003 through 2005. |
(3) | Includes premiums paid on insurance policies on each of the named executive officers as follows: Mr. Hansen — $8,032 for our fiscal year ended March 31, 2003 (“Fiscal Year 2003”); Mr. Lines — $4,417 for Fiscal Year 2003 and $2,160 for Fiscal Year 2005; Mr. Northrup — $6,054 for Fiscal Year 2003; Mr. Cadena — $14,050 for Fiscal Year 2003; and Mr. Marks — $7,540 for Fiscal Year 2003. |
(4) | Includes for Mr. Johnson $125,338 in relocation and related expenses in connection with his commencement of service as our President and Chief Executive Officer. |
(5) | Includes for Mr. Lines payment for published professional articles of $3,025 for Fiscal Year 2003 and $1,375 for our fiscal year ended March 31, 2004 (“Fiscal Year 2004”) and also payment in lieu of vacation of $2,653 for Fiscal Year 2005. |
(6) | Includes for Mr. Northrup a long-term service award of $5,306 for Fiscal Year 2004. |
(7) | Includes cash proceeds received in Fiscal Year 2004 upon termination of split-dollar life insurance policies maintained by us as follows: Mr. Hansen — $86,475; Mr. Lines — $41,757; Mr. Marks — $4,010; Mr. Northrup — $81,654; Mr. Cadena — $63,847. Also includes for Fiscal Year 2004 the cash surrender value of $49,313 for life insurance policies transferred by us to Mr. Cadena as part of our termination of our split-dollar insurance benefit. Our termination of our split-dollar life insurance program realized a tax benefit to us in Fiscal Year 2004 of approximately $130,000 and brings an annual net cost saving of approximately $48,000. |
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(8) | Includes for Mr. Cadena with respect to Fiscal Year 2005 payment in lieu of vacation of $39,314, a long- term service award of $13,556 and payment of $45,844 pursuant to a post-retirement consultation agreement between Mr. Cadena and us. |
(9) | Includes for Mr. Marks with respect to Fiscal Year 2005 payment in lieu of vacation of $22,805 and $23,352 paid to Mr. Marks following the conclusion of his service with us pursuant to the employment agreement between Mr. Marks and us. |
(10) | Mr. Johnson’s salary commenced November 29, 2004. |
(11) | Represents gain from sale of stock acquired by exercising stock options. |
Individual Grants | Potential Realizable | |||||||||||||||||||||||
Value at Assumed | ||||||||||||||||||||||||
Percent of | Annual Rates of | |||||||||||||||||||||||
Number of | Total | Stock Price | ||||||||||||||||||||||
Securities | Options/SARs | Exercise | Appreciation for | |||||||||||||||||||||
Underlying | Granted to | or Base | Option Term | |||||||||||||||||||||
Options/SARs | Employees in | Price | Expiration | |||||||||||||||||||||
Name | Granted (#)(1) | Fiscal Year (%) | ($/Share) | Date | 5% ($) | 10% ($) | ||||||||||||||||||
William C. Johnson | 18,000 | 60.0 | % | 13.00 | 12/2/14 | 147,161 | 372,936 | |||||||||||||||||
J. Ronald Hansen | 3,000 | 10.0 | % | 12.50 | 10/28/14 | 23,584 | 59,765 | |||||||||||||||||
James R. Lines | 3,000 | 10.0 | % | 12.50 | 10/28/14 | 23,584 | 59,765 | |||||||||||||||||
Stephen P. Northrup | 3,000 | 10.0 | % | 12.50 | 10/28/14 | 23,584 | 59,765 | |||||||||||||||||
Philip Marks | 3,000 | 10.0 | % | 12.50 | 10/28/14 | 23,584 | 59,765 |
(1) | All stock options are currently vested, non-qualified stock options. |
Shares | Number of Securities | |||||||||||||||||||||||
Acquired | Underlying Unexercised | Value of Unexercised In-the- | ||||||||||||||||||||||
on | Value | Options/SARs at Fiscal | Money Options/SARs at | |||||||||||||||||||||
Exercise | Realized | Year-End (#) | Fiscal Year-End ($)(1) | |||||||||||||||||||||
Name | (#) | ($) | Exercisable | Unexercisable | Exercisable | Unexercisable | ||||||||||||||||||
William C. Johnson | –0– | –0– | 18,000 | –0– | 76,500 | –0– | ||||||||||||||||||
J. Ronald Hansen | 9,000 | 31,816 | 4,200 | –0– | 14,250 | –0– | ||||||||||||||||||
James R. Lines | 3,000 | 12,109 | 13,200 | –0– | 122,000 | –0– | ||||||||||||||||||
Stephen P. Northrup | –0– | –0– | 16,200 | –0– | 147,450 | –0– | ||||||||||||||||||
Alvaro Cadena | 7,700 | 58,175 | 36,815 | –0– | 230,493 | –0– | ||||||||||||||||||
Philip Marks | 12,340 | 63,558 | 3,000 | –0– | 14,250 | –0– |
(1) | Based on the closing price of our common stock on March 31, 2005, which was $17.25 per share. |
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Years of Service | ||||||||||||||||
Remuneration ($) | 15 | 20 | 25 | 30/35 | ||||||||||||
100,000 | $ | 25,000 | $ | 33,333 | $ | 41,670 | $ | 50,000 | ||||||||
125,000 | $ | 31,250 | $ | 41,662 | $ | 52,088 | $ | 62,500 | ||||||||
150,000 | $ | 37,500 | $ | 49,995 | $ | 62,505 | $ | 75,000 | ||||||||
160,000 | $ | 40,000 | $ | 53,333 | $ | 67,667 | $ | 80,000 | ||||||||
175,000(1) | $ | 43,750 | $ | 58,328 | $ | 72,922 | $ | 87,500 | ||||||||
260,000(1) | $ | 65,000 | $ | 86,667 | $ | 108,334 | $ | 130,000 |
(1) | For the U.S. Retirement Income Plan (as defined below), with respect to Fiscal Year 2004, $205,000 was the maximum amount of compensation that could be used as the basis for determining benefits under applicable law; for Fiscal Year 2005 the amount was $210,000. For the Supplemental Plan (as defined below), with respect to Fiscal Year 2004 only base salary over $205,000 was used as the basis for determining benefits and for Fiscal Year 2005 only base salary over $210,000 was used as such basis. |
Change in Control Arrangements
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• | To provide a reasonable level of compensation sufficient to attract and retain executive personnel best suited by training, ability, and other relevant criteria for the management requirements of our company. | |
• | To balance base compensation (non-contingent) and incentive compensation (contingent upon performance) for the purpose of motivating executive personnel. | |
• | To determine the extent and method of aligning the financial interest of our executive personnel with the interest of our stockholders in the appreciation of their investment. |
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Compensation Committee: | |
H. Russel Lemcke, Chairman | |
Helen H. Berkeley | |
Jerald D. Bidlack | |
James J. Malvaso | |
Cornelius S. Van Rees |
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Audit Committee: | |
William C. Denninger, Chairman | |
Helen H. Berkeley | |
Jerald D. Bidlack | |
H. Russel Lemcke |
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Fiscal Year | Fiscal Year | |||||||
2005 | 2004 | |||||||
Audit Fees | $ | 74,580 | $ | 84,630 | ||||
Audit-Related Fees | 65,540 | 22,095 | ||||||
Tax Fees | 51,325 | 44,453 | ||||||
All Other Fees | 0 | 0 | ||||||
TOTAL | $ | 191,445 | $ | 151,178 | ||||
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By Order of the Board of Directors | |
WILLIAM C. JOHNSON | |
President & Chief Executive Officer |
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PROXY 2005
GRAHAM CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Jerald D. Bidlack and James J. Malvaso, or either of them, each with power of substitution, as proxies to attend the Annual Meeting of Stockholders of Graham Corporation to be held at the Holiday Inn-Airport, 911 Brooks Avenue, Rochester, New York 14624 on Thursday, July 28, 2005 at 11:00 a.m., and any adjournment thereof, and to vote in accordance with the following instructions the number of shares the undersigned would be entitled to vote if personally present at such meeting:
Address Change/Comments (Mark the corresponding box on the reverse side) | |||||
You can now access your Graham Corporation account online.
Access your Graham Corporation stockholder account online via Investor ServiceDirect®(ISD).
Mellon Investor Services LLC, Transfer Agent for Graham Corporation, now makes it easy and convenient to get current information on your stockholder account.
• | View account status | • | Make address changes | |||||||
• | View certificate history | • | Obtain a duplicate 1099 tax form | |||||||
• | View payment history for dividends | • | Establish/change your PIN |
Visit us on the web at http://www.melloninvestor.com
Call 1-877-978-7778 between 9am-7pm
Monday-Friday Eastern Time
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES AND FOR RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS. | Please o Mark Here for Address Change or Comments SEE REVERSE SIDE |
1. | Election of Directors | FOR nominee(s) listed except as marked to the contrary | WITHHOLD AUTHORITY for all nominees | |||||
01 02 03 | William C. Denninger to serve until 2008 H. Russel Lemcke to serve until 2008 Cornelius S. Van Rees to serve until 2008 | o | o | |||||
Withheld for the nominee you list below: (Write that nominee’s name in the space provided below.) | ||||||||
2. | Ratification of the appointment of Deloitte & Touche LLP as independent auditors for the fiscal year ending March 31, 2006. | FOR o | AGAINST o | ABSTAIN o |
3. | In their discretion, to vote upon all other matters as may be properly brought before the meeting. | |||||||
This Proxy, when properly executed, will be voted in the manner directed herein by the undersigned stockholder. If no direction is made, this Proxy will be votedFOR the election of the nominees andFOR ratification of the appointment of auditors. | ||||||||
o | To help our preparation for the meeting, please check here if you plan to attend. | |||||||
Please sign exactly as name(s) appears on this proxy and return it promptly whether you plan to attend the meeting or not. If you do attend, you may, of course, vote in person. The space below may be used for any questions or comments you may have. |
SIGNATURE _______________________________________ SIGNATURE _______________________________________ DATE ___________________
GRAHAM CORPORATION | CONFIDENTIAL VOTING INSTRUCTION |
This Instruction is solicited by the Employee Benefits Committee
of Graham Corporation
as a named fiduciary for the
EMPLOYEE STOCK OWNERSHIP PLAN OF GRAHAM CORPORATION (“Plan”)
For the Annual Meeting of Stockholders to be held on July 28, 2005
The undersigned Participant, Former Participant or Beneficiary of a deceased Former Participant in the Plan (the “Instructor”) hereby provides the voting instructions hereinafter specified to the Employee Benefits Committee of Graham Corporation (the “Committee”), which instructions shall be taken into account in directing the Trustee of the Plan to vote, in person, by limited or general power of attorney, or by proxy, the shares and fractional shares of common stock (the “Shares”) of Graham Corporation (the “Corporation”) which are held by the Trustee of the Plan, in its capacity as Trustee, as of June 10, 2005 (the “Record Date”) at the Annual Meeting of Stockholders of the Corporation (the “Annual Meeting”) to be held at the Holiday Inn-Airport, 911 Brooks Avenue, Rochester, New York 14624, on July 28, 2005 at 11:00 a.m., or at any adjournment thereof.
As to the nominees and proposals listed on the reverse side hereof and as more particularly described in the Corporation’s Proxy Statement dated June 28, 2005, the Committee will give voting directions to the Trustee of the Plan. Such directions will reflect the voting instructions filed by the Instructor on this Confidential Voting Instruction, in the manner described in the accompanying letter from the Committee dated June 28, 2005.
As to other matters which may properly come before the Annual Meeting, the Trustee will be instructed to vote upon such matters in its discretion, or cause such matters to be voted upon in the discretion of the individuals named in any proxies executed by it.
The instructions set forth on the reverse side hereof will be taken into account as described above in directing the Trustee of the Plan how to vote the Shares of the Corporation held by it as of the Record Date in its capacity as Trustee, provided this card is received by the Burke Group by July 21, 2005.
Please mark, sign and date this voting instruction card on the reverse side and return it in the enclosed envelope.
IF THIS VOTING INSTRUCTION IS SIGNED BUT NO DIRECTION IS GIVEN, THIS VOTING INSTRUCTION CARD WILL BE DEEMED TO INSTRUCT VOTES “FOR” THE ELECTION OF THE NOMINEES AND “FOR” PROPOSAL 2.
ESOP COMMON (as of 6/10/05) | PLEASE MARK YOUR CHOICE LIKE THIS: IN BLUE OR BLACK INK. |
The Board of Directors Recommends a Vote “For” the election of nominees and “For” proposal 2. | |||||||||||||||||||
1. | Election of Directors | FOR | WITHHOLD | 2. | Ratification of the appointment of Deloitte & Touche LLP as independent auditors for the period April 1, 2005 through March 31, 2006. | ||||||||||||||
For a three-year Term | |||||||||||||||||||
William C. Denninger | o | o | FOR | AGAINST | ABSTAIN* | ||||||||||||||
H. Russel Lemcke | o | o | o | o | o | ||||||||||||||
Cornelius S. Van Rees | o | o | |||||||||||||||||
3. | In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Annual Meeting or any adjournment thereof. |
The undersigned hereby instructs the Committee to direct the Trustee of the Plan to vote in accordance with the voting instructions indicated above and hereby acknowledges receipt of the letter from the Committee dated June 28, 2005, a Notice of Annual Meeting of Stockholders of Graham Corporation and a Proxy Statement for the Annual Meeting. | ||||||
Date | ||||||
Signature | ||||||
Signature | ||||||
Please sign exactly as your name appears on this instruction. Each owner of shares held jointly must sign this voting instruction. If signing as attorney, executor, administrator, trustee or guardian, please include your full title. Corporate proxies must be signed by an authorized officer. | ||||||
* | For purposes of the unallocated Shares held by the Employee Stock Ownership Plan, abstention is equivalent to not voting. |
Employee Benefits Committee
June 28, 2005
Dear Plan Accountholder:
The Employee Stock Ownership Plan of Graham Corporation (“ESOP”) has a related trust (the “ESOP Trust”) which owns common stock of Graham Corporation (“Graham”). GreatBanc Trust Company as trustee of the ESOP is a stockholder of Graham and may vote on matters presented for stockholder action at Graham’s 2005 Annual Meeting of Stockholders scheduled to be held on July 28, 2005 (“Annual Meeting”).
The ESOP Trust provides that in casting its vote at the 2005 Annual Meeting, the ESOP Trustee is to follow directions given by Graham’s Employee Benefits Committee (“Committee”). The Committee in turn follows instructions provided by participants, former participants and beneficiaries of deceased former participants with respect to the Graham common stock allocated to their accounts in the ESOP as of June 10, 2005.
The records for the ESOP indicate that you are among the individuals who may give voting instructions. You may give your instructions by completing and signing the enclosed Confidential Voting Instruction Card (“Instruction Card”) and returning it in the envelope provided to the Burke Group, which maintains the records for this plan. The Instruction Card lets you give instructions for each matter expected to be presented for stockholder action at the Annual Meeting. The Committee expects the Burke Group to tabulate the instructions given on a confidential basis and to provide the Committee with only the final results of the tabulation. The final results will be used in directing the ESOP Trustee.
The voting of the common stock held by the ESOP Trust is subject to legal requirements under the Employee Retirement Income Security Act of 1974, as amended. The Committee, in consultation with its legal advisors, considers these requirements in establishing voting instruction procedures and directing the ESOP Trustee how to vote. The remainder of this letter describes the voting procedures which the Committee expects to follow for the 2005 Annual Meeting.
How your voting instructions count depends on whether it was anticipated that the matter being voted upon would be presented for stockholder action at the Annual Meeting; if you had an interest in the ESOP Trust on the proper date; and how large your interest was, as follows:
Anticipated Proposals
If Graham Common Stock Was Allocated to Your Account Under the ESOP Trust as of June 10, 2005
In general, the ESOP Trustee will be directed to vote the number of shares of Graham common stock (if any) held by the ESOP Trust and allocated as of June 10, 2005 to your individual account under the ESOP according to the instructions specified on the reverse side of the Instruction Card. The Instruction Card shows the number of shares of Graham common stock allocated to your individual account under the ESOP Trust as of June 10, 2005. If you do not file the Instruction Card by July 21, 2005, you will be deemed to have instructed the ESOP Trustee to ABSTAIN as to all
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proposals.
Unanticipated Proposals
It is possible, although very unlikely, that proposals other than those specified on the Instruction Card will be presented for stockholder action at the 2005 Annual Meeting. If this should happen, the ESOP Trustee will be instructed to vote upon such matters in their discretion, or to cause such matters to be voted upon in the discretion of the individuals named in any proxies executed by them.
Your interest in the ESOP Trust offers you the opportunity to participate, as do Graham’s stockholders, in decisions that affect Graham’s future, and we encourage you to take advantage of it. To help you decide how to complete the Instruction Card, enclosed is a copy of the Proxy Statement that is being furnished to all holders of Graham common stock in connection with the 2005 Annual Meeting. Please complete, sign and return your Instruction Card today. Your instructions are important regardless of the size of your interest in the ESOP Trust.
If you have questions regarding the terms of the ESOP, or how to complete the Instruction Card, please call J. Ronald Hansen, Vice President-Finance & Administration at (585) 343-2216.
Sincerely,
EMPLOYEE BENEFITS COMMITTEE
OF GRAHAM CORPORATION
ca
Enclosures