[GRAPHIC OMITTED]
DENISON INTERNATIONAL PLC
2002 PROXY STATEMENT
Annual General Meeting to be held May 28, 2002 at 11:00 am at The Marriott
Courtyard Hotel, 866 Third Avenue, New York, NY 10022
Denison International plc
14249 Industrial Parkway
Marysville, Ohio 43040
937-644-4500
April 18, 2002
Dear Fellow Members and Shareholders:
It is our pleasure to invite you to attend the 2002 Annual General Meeting of
Denison International plc, to be held at 11:00 a.m. on May 28, 2002. The Meeting
will be held at The Marriott Courtyard Hotel, located at 866 Third Avenue, New
York, N Y, 10022.
The following are currently on the Meeting's agenda: (i) receipt of the 2001
accounts, (ii) re-election of Two (2) Directors, (iii) the approval of the
appointment of Ernst & Young LLP as independent auditors for fiscal year ending
December 31, 2002, and authorizing the directors to fix the auditors
remuneration;(iv) the approval authorizing the Company to enter into a
contingent purchase contract to purchase its ordinary shares; and (v) other such
business as may properly come before the meeting. Additional information
concerning these matters is included in the Notice of Annual Meeting and Proxy
Statement. I, along with other members of executive management, will review with
you Denison's operations during the past year and will be available to respond
to questions during the Meeting.
We look forward to seeing you at the meeting.
Sincerely,
/s/ J. Colin Keith
J. Colin Keith
Chairman
ii
TABLE OF CONTENTS
PAGE
----
NOTICE OF ANNUAL MEETING.................................................. iii
PROXY STATEMENT........................................................... 1
General Information....................................................... 1
Ownership of Common Stock by Certain Beneficial Owners.................... 2
Security Ownership of Directors and Officers.............................. 2
Board of Directors and Committees of the Board............................ 3
Re-Election of Directors.................................................. 5
Incumbent Directors to Continue in Office................................. 6
Executive Compensation.................................................... 7
Section 16(a) Beneficial Ownership Reporting Compliance................... 9
Stockholder Return Performance Presentation............................... 9
Approval of Independent Auditors.......................................... 9
Approval of Contingent Purchase Contract.................................. 10
Other Business............................................................ 10
Ownership of Outstanding Voting Shares.................................... 10
Incorporation by Reference................................................ 12
Audit Charter. ........................................................... E-1
Form of Proxy ........................................................ E-4
Contingent Purchase Contract for Re-Purchase of Ordinary Shares........... E-5
iii
----------------
NOTICE OF ANNUAL MEETING OF MEMBERS AND SHAREHOLDERS
ON
May 28, 2002
----------------
NOTICE IS HEREBY GIVEN that the 2002 Annual General Meeting of Members and
Shareholders of DENISON INTERNATIONAL PLC (the "Company") will be held at The
Marriott Courtyard Hotel, 866 Third Avenue, New York, NY 10022, on Tuesday, May
28, 2002 at 11:00 a.m., EDT (the "Meeting"), for the purpose of:
(1) Receiving the audited accounts for the year ended December 31, 2001
together with the directors' and auditors' reports;
(2) Re-electing Christopher H B Mills and Bruce A Smith to the Board of
Directors of the Company;
(3) Approving the appointment of auditors for the fiscal year ending December
31, 2002, and authorizing the directors to fix such auditors' remuneration;
(4) As special business, to consider and, if thought fit, passing the following
resolution as a special resolution:
"Resolved, that the terms of the draft contract proposed to be made
between the Company and ABN AMRO Securities LLC, its successors or
assigns, under which the Company may become obligated to purchase
certain of its issued ordinary shares of $US 0.01 each in substantially
the form as attached in Exhibit 3.00 (a copy of which is produced to
the meeting and signed for the purpose of identification by the
Chairman) be hereby approved and authorized for the purposes of section
165 of the Companies Act 1985, such approval to expire on the date 18
months from the date on which this resolution is passed"; and
(5) Transacting such other business as may properly come before the Meeting.
The Board of Directors has fixed the close of business on April 1, 2002, as
the record date for the determination of American Depository Receipt holders
entitled to vote at the Meeting. Not withstanding the foregoing, under the
Companies Act 1985,an "A" ordinary shareholder on the register at the date of
the Meeting is entitled to vote at the Meeting.
It is important that your shares be represented at the meeting regardless of
the number of shares that you own. To vote, simply complete and sign the Proxy
Card, which is being solicited by the Board of Directors of the Company, and
return it in the enclosed postage pre-paid envelope as soon as you can.
You are cordially invited to attend the Meeting. If you plan to attend the
Meeting, please use this Notice of Meeting as your admission ticket. You may, of
course, attend the Meeting without an admission ticket, upon proper
identification.
By Order of the Board of Directors,
Denison International plc
/S/ Paul G. Dumond
PAUL G. DUMOND
Company Secretary
April 18, 2002
1
PROXY STATEMENT
GENERAL INFORMATION
As used herein, references to the "Company" and "Denison" refer to Denison
International plc and its subsidiaries, unless the context indicates otherwise.
References to "shares" herein refer to the Ordinary Shares of Denison $0.01
par value per Share and Denison's American Depository Shares ("ADSs"), each of
which represents one Share. The ADSs are evidenced by American Depository
Receipts ("ADRs").
References to "Shareholders" herein refer to holders of ADR's.
References to "Members" herein refer to holders of the Company's "A" Ordinary
Shares, (pound)8.00 par value per share.
This Proxy Statement is furnished in connection with the solicitation of
proxies to be used at the Company's Annual Meeting of Members and Shareholders
to be held on May 28, 2002, and at any adjournment thereof (the "Meeting").
Denison's Annual Report to Shareholders, including financial statements,
accompanies this Notice and Proxy Statement, but is not incorporated as part of
the Proxy Statement and is not to be regarded as part of the proxy solicitation
material. These materials are being sent to stockholders on or about April 22,
2002.
SOLICITATION OF PROXIES
Proxies are solicited by the Board of Directors of Denison in order to provide
every Member and Shareholder an opportunity to vote on all matters scheduled to
come before the Meeting, whether or not the Member or Shareholder attends the
Meeting in person. When the Proxy Card is properly signed and returned, the
shares represented thereby will be voted by the proxy holders named on the card
in accordance with the Member's or Shareholder's directions. You are urged to
specify your choices by marking the appropriate boxes on the enclosed Proxy
Card. If the Proxy Card is signed and returned without specifying choices, the
shares will be voted as recommended by the Board of Directors. A Member or
Shareholder giving a proxy may revoke it at any time before it is voted by
filing with the Company Secretary an instrument revoking it, or by a duly
executed and deposited Proxy Card bearing a later date. If you attend the
Meeting, you may vote by ballot, thereby canceling any proxy vote previously
given.
If you wish to give a proxy to someone other than those designated on the
Proxy Card, you may do so by crossing out the names of the designated proxies
and by then inserting the name of another person(s). A copy of the signed Proxy
Card deposited with the Company should be presented at the Meeting by the
person(s) representing you.
Solicitation of proxies is made on behalf of the Board of Directors of
Denison, and the cost of preparing, assembling, and mailing the Notice of Annual
Meeting, Proxy Statement and Proxy Card will be paid by Denison. In addition to
the use of the mail, proxies may be solicited by Directors, Officers and regular
employees of Denison, without additional compensation, in person or by telephone
or telegraph. Denison will reimburse brokerage houses and other nominees for
expenses in forwarding proxy material to beneficial owners of ADR's.
MEMBER AND SHAREHOLDER VOTING
On April 1, 2002, there were 10,567,700 shares and 7,015 "A" Ordinary Shares
of Denison issued and outstanding and entitled to vote. Each share is entitled
to one vote.
Under the Companies Act 1985 two Members must be present in person or by proxy
at the Annual General Meeting in order to constitute a quorum for the purpose of
transacting business. Approval of the proposals presented at the meeting is
governed by Denison's Memorandum and Articles of Association and United Kingdom
law. A majority of the votes cast must approve the re-election of directors and
the appointment of the independent auditors. Holders of 75% of the votes cast
must approve the contingent contract to repurchase shares of the Company.
2
An abstention occurs when a Member or Shareholder is present either in person or
by proxy at the meeting but the Member or Shareholder does not vote. Brokers who
hold shares in street names for customers have the authority to vote only on
certain routine matters in the absence of instructions from the beneficial
owners. A broker non-vote occurs when the broker does not have the authority to
vote on a particular proposal. Abstentions and broker non-votes are not included
in the tabulations for re-election of the directors or approval of the auditors.
However, abstentions and broker non-votes are counted in the tabulation for the
votes on the proposal to repurchase shares of the Company, and will have the
effect of a negative vote.
OWNERSHIP OF COMMON STOCK BY CERTAIN BENEFICIAL OWNERS
Listed below are the only individuals or entity known to the Board of
Directors and Management to own more than 10% of the issued and outstanding
shares of Common Stock as of April 1, 2002:
(1)
NUMBER OF SHARES PERCENT
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- ------------------------------------ ------------------ --------
J. Colin Keith (2) 1,400,000 13.2%
Anders C. H. Brag (2) 1,350,000 12.8%
E. F. Gittes (2) 1,200,000 11.4%
(1) For purposes of this table, ownership is determined in accordance with the
beneficial ownership rules of the Securities Exchange Act of 1934, which deems
shares to be beneficially owned by any person who has, or shares, voting or
investment power with respect to the ordinary shares. Unless otherwise
indicated, the Company believes based on information furnished by such persons,
that the persons named in this table have sole voting and sole investment power
with respect to all shares shown as beneficially owned.
(2) Mr. Keith is Chairman of the Board of Directors of the Company; Mr. Brag
is Managing Director of the Company. Mr. Gittes retired from the Board in May,
1999.
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table sets forth information as of April 1, 2002, regarding
beneficial ownership of Shares of each Director, Denison's four most highly
compensated Officers (the "Named Officers") and the Directors and Officers as a
group.
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP(1)
AGGREGATE NUMBER PERCENT OF
OF SHARES OUTSTANDING
NAME BENEFICIALLY OWNED(1) SHARES
---- ----------------------- -----------
Keith, J. C (2) 1,400,000 13.2%
Brag, A. C. H. (2) 1,350,000 12.8%
Weir, D. L. (2) 65,000 .6%
Mills, C. B. H. (3) 74,070 .7%
Morton, R. James P. (3) 0
Smith, B. A. (2) 0
All Directors and Officers as a group (6
in all) 2,889,070 27.3%
3
(1) For purposes of this table, ownership is determined in accordance with
the beneficial ownership rules of the Securities Exchange Act of 1934,
which deems shares to be beneficially owned by any person who has, or
shares, voting or investment power with respect to the ordinary shares.
Unless otherwise indicated, the Company believes based on information
furnished by such persons, that the persons named in this table have sole
voting and sole investment power with respect to all shares shown as
beneficially owned.
(2) Mr. Keith is Chairman of the Board of Directors of the Company, Mr. Brag
is Managing Director of the Company, Mr. Weir is the President and Chief
Executive Officer of the Company and Mr. Smith is Chief Financial Officer
of the Company.
(3) Messrs. Mills and Morton are directors of the Company.
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board of Directors held 6 meetings during fiscal year 2001. The average
attendance for Denison's Directors at these meetings was 95%. All of the
Company's Directors attended at least 67% of the Board of Directors Meetings.
All directors of the Company are paid fees for serving on the Board of
Directors. The basic annual fee received by each director is 12,000 British
Pounds. All directors are also reimbursed for reasonable expenses incurred in
attending Board of Directors and Committee meetings.
The directors have power to provide benefits whether by payment of gratuities,
pensions or otherwise to (or to any person in respect of) any director or
ex-director and for the purpose of providing any such benefits to contribute to
any scheme or fund or to pay premiums.
The Board of Directors has standing Audit, Compensation and Nominating
Committees.
AUDIT COMMITTEE
The Audit Committee oversees Denison's financial reporting process on behalf
of the Board of Directors and recommends the independent accountants to conduct
the annual audit of the financial statements of Denison. The Committee maintains
a direct line of communication with Denison's auditors. The Audit Committee
currently consists of Messrs. Morton (who also acts as the Committee's
Chairman), Brag and Mills. The Committee held five meetings during fiscal year
2001.
The Board of Directors has determined that Messrs. Morton and Mills both meet
the requirements for independence as set forth under the listing standards of
the NASDAQ Stock Exchange. The Board of Directors has determined that Mr. Brag,
Managing Director of the Company and an employee of the Company's US subsidiary,
does not meet the requirements for independence. Despite Mr. Brag's failure to
meet the definition of independence , the Board of Directors believes that his
expertise in financial matters made his appointment to the Audit Committee
required in order to serve the best interests of the Company and its
shareholders. In appointing Mr. Brag to the Audit Committee the Board of
Directors considered the guidance as contained in the listing standards of the
NASDAQ Stock Exchange relating to non-independent committee members.
The functions of the audit committee are pursuant to our charter (see exhibit
1.00) and the rules and regulations of the Securities and Exchange Commission
("SEC") and the NASDAQ Stock Market, Inc. ("NASDAQ"). In compliance with these
regulations, the entire Board of Directors, in 2001, reviewed the composition
of the audit committee and:
(i) determined that each member satisfies the requirements to serve on
the Committee as defined by the SEC and NASDAQ,
(ii) determined that each member possessed the requisite financial
literacy, and
(iii) determined that at least one member possessed financial management
expertise.
4
AUDIT COMMITTEE REPORT
The following is the report of the Audit Committee with respect to the
Company's audited financial statements for the fiscal year ended December 31,
2001, which include the consolidated balance sheets of the Company as of
December 31, 2001 and 2000, and the related consolidated statements of
operations, stockholders' equity and cash flows for each of the three years in
the period ended December 31, 2001, and the notes thereto. The information
contained in this report shall not be deemed to be "soliciting material" or to
be "filed" with the Securities and Exchange Commission, nor shall such
information be incorporated by reference into any future filing under the
Securities Act of 1933, as amended, or the 1934 Securities Exchange Act, as
amended, except to the extent that the Company specifically incorporates it by
reference in such filing.
The Audit Committee, in addition to performing its customary duties contained
in its charter, this year reviewed the independence of independent accountants
and non-audit functions as performed by the independent accountants, as well as
issues relating to the independence of the audit committee members.
Specifically, the audit committee addressed the following matters:
o The committee reviewed quarterly reports on Form 10-Q for each quarter
in 2001 and reviewed and discussed the 2001 year end audited financial
statements with management,
o The committee engaged in private discussions with the independent
accountants, Ernst & Young LLP ("E&Y"), to discuss matters relevant to
the planning and implementation of the 2001 audit procedures,
o The committee engaged in private discussions with the independent
accountants to discuss the cooperation and adequacy of management, and
discussed matters required to be discussed under the Statement of
Auditing Standards No. 61 "Communications with Audit Committees" (SAS
61), relating to the audited 2000 financial statements,
o The committee discussed with the independent accountants matters
required to be discussed under SAS 61 relating to the audited 2001
financial statements,
o The committee discussed with the independent accountants their
independent status, including the implications of the SEC regulations
regarding the provision of non-audit services preformed by the
independent accountants, and determined that the provision of the
non-audit services was not inconsistent with E&Y's status as independent
accountants, and received from the independent accountants the
disclosures regarding their independence required by Independent
Standards Board's Standard No. 1,
o In reliance on the reviews and discussions referred to above, the
committee recommended to the Board of Directors (and the board approved)
that the audited financial statements be included in the Annual Report
on Form 10-K for the year ended December 31, 2001 for filing with the
SEC, and
o The committee reviewed the fees charged by E&Y for:
(i) performing the audit of the Company's financial statements,
(ii) designing and implementing any financial information systems, and
(iii) all other services performed during the year.
Fees for the audit of the Company's 2001 financial statements and fees billed
for all other services performed by E&Y during 2001 are as follows:
AUDIT FEES:
$376,583
FINANCIAL SYSTEMS DESIGN AND IMPLEMENTATION:
$0.00
5
FEES FOR ALL OTHER SERVICES (including audit related and tax services):
$194,387
THE AUDIT COMMITTEE
Mr. R. James P. Morton, Chairman
Mr. Anders C. H. Brag
Mr. Christopher H. B. Mills
COMPENSATION COMMITTEE
The Compensation Committee reviews and recommends actions to the Board of
Directors on such matters as the salary, bonus and benefits of the Chief
Executive Officer and approves the salary and other compensation of other
Officers. The Committee held two meetings during fiscal year 2001. The Committee
is comprised of three directors. Current members of the Committee are Messrs.
Mills (who also acts as the Committee's Chairman), Brag and Morton. Messrs.
Mills and Morton are deemed to be independent members of the Committee under the
listing standards of the NASDAQ Stock Exchange. Mr. Brag, Managing Director of
the Company and an employee of the Company's US subsidiary, abstains in voting
on any issues that may have a direct impact on his own compensation or benefits.
REPORT OF THE COMPENSATION COMMITTEE
The Company's employee compensation policy for officers is to offer a package
including a competitive salary, an incentive bonus based upon individual
performance goals, competitive benefits, and an efficient workplace environment.
The Company's Compensation Committee reviews and approves individual officer
salaries, bonus performance goals, bonus plan allotments, and stock option
grants under the Denison International Stock Option Plan.
Officers of the Company are paid salaries in line with their responsibilities.
Officers bonus plans are based on the financial performance of the Company in
addition to individual performance measurements, and are based on a percentage
of salary. The Compensation Committee establishes aggressive revenue and profit
goals as an incentive for superior individual and corporate performance.
Likewise, stock option grants to officers and other employees promote success by
aligning employee financial interests with long term shareholder value. Stock
option grants are based on various subjective factors primarily relating to the
responsibilities of the individual officers, and also to their expected future
contributions and prior option grants.
The Budget Reconciliation Act of 1993 amended the Internal Revenue Code to add
section 162(m) which bars a deduction to any publicly held corporation for
compensation paid to a "covered employee" in excess of $1 million per year. The
Compensation Committee does not believe that this law will have an impact on the
Company as the current level of compensation for each of the Company's executive
officers is well below the $1 million salary limitation.
THE COMPENSATION COMMITTEE
Mr. Christopher H. B. Mills, Chairman
Mr. Anders C. H. Brag
Mr. R. James P. Morton
NOMINATING COMMITTEE
The Nominating Committee reviews and recommends to the Board the size,
composition and committee structure of the Board, as well as nominees to the
Board of Directors and its Committees. The Committee met one time during fiscal
year 2001. Current members of the Committee are Messrs. Keith (who also acts as
the Committee's Chairman), Brag , and Weir.
PROPOSAL NO. 1
RE-ELECTION OF DIRECTORS
The Company's Board of Directors consists of six (6) Directors, whose
respective terms expire as outlined below.
6
Unless otherwise decided by the Company by ordinary resolution, the number of
directors shall be not less than three nor more than twelve. Directors may be
appointed by the Company by ordinary resolution. In addition, the Board of
Directors may appoint directors; any director so appointed retires from office
at the next annual general meeting, but is then eligible for re-appointment.
At each annual general meeting as nearly as possible (but not exceeding)
one-third of those directors subject to retirement by rotation are obliged to
retire by rotation, based principally upon length of time in office, and are
eligible for re-election. Any director appointed by the Board of Directors since
the previous annual general meeting is not subject to retirement by rotation. A
director may be removed by ordinary resolution of the Company in general meeting
or by all the other directors.
Unless otherwise specified by the Members and Shareholders, the shares
represented by the proxies will be voted for the re-election of Messrs.
Christopher H B Mills and Bruce A Smith, as Directors who retire by rotation.
Each nominee for Director has consented to be nominated as a Director and will
serve as a Director if re-elected. The names and biographical summaries of the
persons who have been nominated to stand for re-election at the Meeting and the
remaining four directors whose terms are continuing appear below.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE RE-ELECTION OF MESSRS.
MILLS AND SMITH.
CHRISTOPHER H. B. MILLS, age 49, has served as a director since 1993.
Since 1984 Mr. Mills has been Chief Executive of North Atlantic Smaller
Companies Investment Trust and American Opportunities Trust plc. Mr.
Mills is also Chairman of Stanelco plc and a director of a number of
publicly listed companies, including WH Energy and LESCO.
BRUCE A. SMITH, age 46, has been a director of the Company since 1999
and Chief Financial Officer since 1998. Prior to joining Denison, Mr.
Smith held several senior management positions with Yuasa, Inc.,
holding the positions of Vice President - Administration and Treasurer
/ CFO. From 1979 to 1991 Mr. Smith held various positions with Exide
Corporation, last serving as its Corporate Controller.
Although the Board of Directors and Management do not contemplate that any of
the nominees will be unable to serve, in the event that prior to the meeting,
any of the nominees becomes unable to serve because of special circumstances,
the shares of stock represented by the proxies may be voted for the election of
a nominee designated by the Board.
INCUMBENT DIRECTORS TO CONTINUE IN OFFICE
The following are the other Directors whose terms continue after this year's
Meeting, as indicated:
TERMS CONTINUING UNTIL MAY 2004
J. COLIN KEITH, age 57, has been the Chairman of the Board of Denison
since its inception in 1993. Mr. Keith also serves on the board of
Executive Air Support, Inc. and has also served as the Chairman of the
Board of Horace Small Apparel and served as its Chief Executive Officer
through April 2000. From 1987 to May 1997 Mr. Keith was a director of
Scholl plc.
R. JAMES P. MORTON, age 48, has been a director of the Company since
1998. Mr. Morton is an Investment Director of European American
Securities, Inc. From 1991 to 1995 Mr. Morton was the Managing Director
of Chelverton Investments and Chelverton Investment Management Limited.
From 1987 to 1991 Mr. Morton was the Director of Corporate Finance for
Samual Montagu, Inc. Mr. Morton is also a director of a number of other
companies and writes investment books for the Financial Times.
7
TERMS CONTINUING UNTIL MAY 2003
ANDERS C. H. BRAG, age 49, has been a director of the Company since
1993 and Managing Director since 1993. He currently serves as a
director for several private companies. Prior to 1990 Mr. Brag was a
General Partner of Hambro International Venture Fund.
DAVID L. WEIR, age 48, has served as President, Chief Executive Officer
and a Director of the Company since March 1997. Mr. Weir joined the
Company in May 1994 as the Chief Financial Officer, and in September
1994 he was appointed Chief Executive Officer of the Company's North
American Operations. Prior to joining Denison, Mr. Weir held senior
management positions, both in the USA and Europe with the hydraulic
braking division of Lucas Industries.
EXECUTIVE COMPENSATION
The following table sets forth certain information concerning the compensation
paid by the Company for services rendered during the fiscal years ended December
31, 2001, 2000 and 1999 to Denison's Chief Executive Officer and each of the
other Named Officers.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM
COMPENSATION
------------------------ ------------
AWARDS
------------
(A) (B) (C) (D) (E) (G) (I)
NAME AND (2) (3)
PRINCIPAL FISCAL ANNUAL OTHER UNDERLYING ALL OTHER
POSITION YEAR SALARY$ BONUS$ COMPENSATION OPTIONS COMPENSATION
- ------------- ------ ------- ------ ------------- ---------- -------------
J. Colin Keith 2001 130,000 0 17,400 0 0
Chairman 2000 130,000 0 17,400 0 0
1999 130,000 0 17,400 0 0
David L. Weir 2001 231,750 185,533 17,400 0 15,600
President & 2000 225,000 203,800 17,400 0 15,600
CEO (4) 1999 225,000 123,479 17,400 0 4,500
Anders C.H.Brag 2001 130,000 0 17,400 0 0
Managing 2000 130,000 0 17,400 0 0
Director 1999 130,000 0 17,400 0 0
Bruce A. Smith 2001 133,293 33,350 17,400 0 14,500
Chief Financial 2000 129,410 44,977 17,400 0 14,082
Officer 1999 126,254 6,306 10,100 13,000 3,788
(1) There are no other "Awards" to report and column (f) has been omitted
pursuant to SEC rules. There are no "Payouts" to report and column (H)
has been omitted pursuant to SEC rules.
(2) Directors are paid annual compensation for director duties at a rate
of (pound)12,000 (British Pounds). See the section "BOARD OF DIRECTORS
AND COMMITTEES OF THE BOARD". For purposes of this report all years'
compensation has been converted at a rate of $1.45 USD to one British
Pound.
(3) These are amounts contributed by Denison for fiscal 2001, 2000, and 1999 for
the Named Officers under the Savings and Profit Sharing Plan. For fiscal 2001,
these amounts were as follows: Savings Plan: $5,100 and $4,000 respectively
for Messrs. Weir and Smith. Profit Sharing Plan: $10,500 each for Messrs. Weir
and Smith.
8
(4) In May 2000, Denison Hydraulics, Inc., the Company's U.S. subsidiary,
and Mr. Weir agreed to extend a two-year agreement regarding Mr. Weir's
employment with the U.S. subsidiary, entered into in May 1998, under
the same terms and conditions. The extension is incorporated herein by
reference to Denison's Annual Report on Form 10-K, which was filed with
the SEC on or about March 31, 2002.
SAVINGS and PROFIT SHARING PLAN OF DENISON HYDRAULICS INC.
The Savings Plan is a savings and profit sharing plan established pursuant to
Sections 401(a) and 401(k) of the United States Internal Revenue Code. Under
this plan, Denison matches up to 3% of the base pay of each eligible employee,
including officers, to a Trustee for investment into one or more pre-established
investment funds as the participant may choose. Under the profit sharing plan
Denison contributes up to 7% of the base pay of each eligible employee,
including Officers, based on the attainment of certain Company goals, to a
trustee for investment into one or more pre-established investment funds as the
participant may choose.
STOCK OPTION PLAN
In 1994, the Company adopted the Denison International Stock Option Plan (the
"Option Plan") pursuant to which the Board (or a committee thereof) may grant to
certain key employees of the Company or its subsidiaries options to acquire
Ordinary Shares. The price at which Ordinary Shares may be acquired on exercise
of an option must not be less than the market value of the underlying shares on
the date on which the option is granted.
On July 24, 1997, the Company's Board of Directors and shareholders approved
an amendment to the Option Plan. Such amendment included an increase in the
number of Ordinary Shares reserved for issuance under the Option Plan to 850,000
Ordinary Shares.
As of the date hereof, options under the Option Plan for acquisition of
609,250 Ordinary Shares by senior executives of the Company or its subsidiaries
were outstanding. Exercise prices range from $11.563 to $19.53. All options
generally vest over a period of four years following the date of the grant and
lapse between five and ten years after the date of the grant. Options lapse on
dates from August 7, 2002 through January 30, 2012. As of the date hereof,
options under the Option Plan for the purchase of 285,000 Ordinary Shares were
held by all directors and officers of the Company as a group.
STOCK OPTIONS
No stock options were issued to any of the Named Officers in 2001.
STOCK OPTION EXERCISES AND FISCAL YEAR END HOLDINGS
(D) (E)
(A) (B) (C) NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES FISCAL YEAR END FISCAL YEAR END(/2/)
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE (#) REALIZED(/1/) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ ------------- ----------- ------------- ----------- -------------
J. Colin Keith......... 0 $ 0 63,750 11,250 $ 2,800 $ 0
David L. Weir.......... 0 $ 0 82,500 17,500 $ 16,800 $ 0
Anders C. H. Brag...... 0 $ 0 63,750 11,250 $ 2,800 $ 0
Bruce A. Smith......... 0 $ 0 15,500 9,500 $ 23,953 $ 23,953
- ------------
(1) Calculated as fair market value at exercise minus exercise price.
(2) Based on December 31, 2001 market closing price of $16.56 per share of
Common Stock. Amount represents the difference between the exercise price
of the options and the December 31, 2001 market closing price.
9
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
No persons affiliated with the Company were required to file reports under
section 16(a) for the fiscal year ended December 31, 2001.
STOCKHOLDER RETURN PERFORMANCE PRESENTATION
Set forth below for the five year period commencing December 31, 1996 and
ending December 31, 2001 is a line graph comparing the yearly change in the
cumulative total stockholder return on the Corporation's Common Stock against
the cumulative total return of the S&P Composite -- 500 Stock Index and the Peer
Group Index.
STOCKHOLDER RETURN PERFORMANCE TABLE
[OBJECT OMITTED]
COMPARATIVE ANALYSIS
1996 1997 1998 1999 2000 2001
------ ------ ------ ------- ------- -------
Denison International plc. ... 100 107.81 78.13 64.06 92.97 103.50
S&P 500....................... 100 133.43 172.16 208.05 189.92 167.62
Peer Group.................... 100 144.05 101.30 105.26 107.24 108.37
(1) Assumes that the value of the investment in Denison's Common Stock, and
each index, was $100 on December 31, 1996.
PROPOSAL NO. 2
APPROVAL OF APPOINTMENT OF INDEPENDENT AUDITORS
Unless otherwise specified by the Members and Shareholders, the shares of stock
represented by the proxies will be voted for the approval of the appointment of
Ernst & Young LLP, a firm of independent accountants, to audit and report upon
the financial statements of Denison for fiscal year 2002, and to authorize the
directors to fix their remuneration. In the opinion of the Board of Directors
and management, Ernst & Young LLP is well qualified to act in this capacity.
Services performed by Ernst & Young LLP in fiscal year 2001 included audits of
the financial statements of Denison and its subsidiaries and certain of the
pension and other employee benefit plans of the Company, limited reviews of
quarterly financial statements of the Company, tax related services and other
accounting and acquisition related matters. Denison has been advised by Ernst &
Young that the firm has no
10
financial interest, direct or indirect, in Denison, except its providing tax
counseling, acquisition, auditing and independent accounting services during the
period stated.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE APPROVAL OF
THE APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS.
PROPOSAL NO. 3
APPROVAL OF CONTINGENT CONTRACT TO AUTHORIZE THE COMPANY TO RE-PURCHASE
ORDINARY SHARES
Unless otherwise specified by the Members and Shareholders, the shares of
stock represented by the proxies will be voted for the approval and
authorization for the purpose of section 165 of the Companies Act 1985 of the
terms of the draft contract proposed to be made between the Company and ABN AMRO
Securities LLC, its successors or assigns, under which the Company may become
obliged to purchase certain of its ordinary shares of $0.01 each, such approval
and authority to expire on the date 18 months from the date on which this
resolution is passed. The text of the resolution is as follows:
RESOLVED, as special business, to consider and, if thought fit, pass
the following resolution as a special resolution:
"That the terms of the draft contract proposed to be made between the
Company and ABN AMRO Securities LLC, its successors or assigns, under
which the Company may become obligated to purchase certain of its
issued ordinary shares of $US 0.01 each in substantially the form as
attached in exhibit 3.00 (a copy of which is produced at the meeting
and signed for the purpose of identification by the Chairman) be hereby
approved and authorized for the purposes of section 165 of the
Companies Act 1985, such approval to expire on the date 18 months from
the date on which this resolution is passed".
Explanation
The Company proposes to enter into a contingent purchase contract whereby,
subject to the satisfaction of certain conditions, the Company would be obliged
to purchase up to 1,056,395 of its ordinary shares (representing approximately
10% of the ordinary shares issued and outstanding) following the purchase of
ADR's by ABN AMRO Securities LLC on the NASDAQ National Market in accordance
with all applicable US securities laws including Rule 10(b) -18 of the
Securities and Exchange Act of 1934 as amended and Regulation M under that act.
However, before the Company is permitted to enter into this contract, a draft of
the contract must be approved by way of a special resolution of shareholders. A
copy of the contingent purchase contract will be available for inspection at the
Company's registered office from 28 April 2002 until 28 May 2002 and at the
Meeting.
If approved, the authority contained in the contingent purchase contract to
repurchase the Company's shares will only be utilized when the directors believe
that such purchases are in the best interests of stockholders generally and will
result in an increase in earnings per share.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE APPROVAL OF THE
COMPANY TO ENTER INTO THIS CONTRACT AND TO BE AUTHORIZED TO REPURCHASE SHARES.
OTHER BUSINESS
The Board of Directors and Management does not know of any other matters
requiring Member or Shareholder action that may come before the meeting; but, if
any are properly presented, the individuals named in the enclosed form of proxy
will vote on those matters according to their best judgment.
OWNERSHIP OF OUTSTANDING VOTING SHARES
Set forth below is certain information concerning persons who are known by
Denison to have reported owning beneficially more than 5% of the Company's ADR's
as of the most recent practicable date.
11
TITLE OF CLASS: AMERICAN DEPOSITORY SHARES
NAME AND ADDRESS OF NUMBER PERCENT
BENEFICIAL OWNER OF SHARES OF CLASS
-------------------------------------------------------------------
J. Colin Keith (1) 1,400,000 13.2%
551 Madison Avenue
New York, NY 10022
Anders C.H. Brag (1) 1,350,000 12.8%
551 Madison Avenue
New York, NY 10022
E. F. Gittes 1,200,000 11.4%
551 Madison Avenue
New York, NY 10022
First Manhattan Co. (2) 1,054,913 9.9%
437 Madison Avenue
New York, NY 10022
First Pacific Advisors, Inc. (3) 855,900 8.1%
11400 West Olympic Blvd.
Suite 1200
Los Angeles, CA 90064
State Street Research 792,700 7.5%
& Management Company (4)
One Financial Center, 30th Floor
Boston, MA 02111-2690
Royce & Associates, Inc. (5) 653,000 6.2%
1414 Avenue of the Americas
New York, NY 10019
(1) Mr. Keith is Chairman of the Board of Directors of the Company, Mr. Brag is
Managing Director of the Company.
(2) First Manhattan Co. has filed with the Securities and Exchange Commission a
Schedule 13G/A dated February 14, 2002, which reports the beneficial
ownership of 1,054,913 American Depository shares by it and certain
affiliated entities and individuals. As reported in the Schedule 13G/A,
First Manhattan Co. and such affiliated entities and individuals have sole
voting power with respect to 66,000 shares and shared power to dispose or to
direct the disposition of 988,913 shares.
(3) First Pacific Advisors, Inc. has filed with the Securities and Exchange
Commission a Schedule 13G dated February 11, 2002, which reports the
beneficial ownership of 855,900 American Depository shares by it and certain
affiliated entities and individuals. As reported in the Schedule 13G, First
Pacific Advisors, Inc. and such affiliated entities and individuals have
sole voting power with respect to 630,900 shares and shared power to dispose
or to direct the disposition of 855,900 shares.
(4) State Street Research & Management Company has filed with the Securities and
Exchange Commission a Schedule 13G dated February 21, 2002, which reports
the beneficial ownership of 792,700 American Depository shares by it and
certain affiliated entities and individuals. As reported in the Schedule
13G, State Street Research & Management Company and such affiliated entities
and individuals have sole voting power with respect to 792,700 shares and
sole power to dispose or to direct the disposition of 792,700 shares.
(5) Royce & Associates, Inc. has filed with the Securities and Exchange
Commission a Schedule 13G dated February 7, 2002, which reports the
beneficial ownership of 653,000 American Depository shares by it and certain
affiliated entities and individuals. As reported in the Schedule 13G, Royce
& Associates, Inc. and such affiliated entities and individuals have sole
voting power with respect to 653,000 shares and sole power to dispose or to
direct the disposition of 653,000 shares.
12
INCORPORATION BY REFERENCE
The audited financial statements, disclosures about market risks and
Management's discussion and analysis required by Item 13 of Schedule 14A are
incorporated herein by reference to Denison's Annual Report on Form 10-K, which
was filed with the SEC on or about March 31, 2002. The Form 10-K will be
furnished without charge upon written request of any stockholder. Requests
should be directed to the Chief Financial Officer, Denison International plc,
14249 Industrial Parkway, Marysville, Ohio 43040.
By order of the Board of Directors.
Bruce A. Smith
Director & Chief Financial Officer
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EXHIBIT 1.00
DENISON INTERNATIONAL plc
AUDIT COMMITTEE CHARTER
Adopted May 8, 2000
(As Amended May 22, 2001)
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Page One
Organization
This charter governs the operations of the Audit Committee ("Committee") of the
board of directors of Denison International plc ("Company"). The Committee shall
review and reassess the charter at least annually and obtain the approval of the
board of directors. The Committee shall be appointed by the board of directors
and shall comprise, at a date not later than April 2001, at least three
directors, with at least two of whom shall be independent of management and the
Company. A director (i) who is a partner, controlling shareholder, or executive
officer of an organization that has a business relationship with the Company, or
(ii) who has a direct business relationship with the Company (e.g., a
consultant) may serve on the audit committee only if the Board determines in its
business judgment that the relationship does not interfere with the director's
exercise of independent judgment. In making a determination regarding the
independence of a director pursuant to this paragraph, the Board should
consider, among other things, the materiality of the relationship to the
Company, to the director, and, if applicable, to the organization with which the
director is affiliated. Members of the Committee shall be considered independent
if they have no relationship that may interfere with the exercise of their
independence from management and the Company. All committee members shall be
financially literate, or shall become financially literate within a reasonable
period of time after appointment to the committee, and at least one member shall
have accounting or related financial management expertise.
Statement of Policy
The Committee shall provide assistance to the board of directors in fulfilling
their oversight responsibility to the shareholders, potential shareholders, the
investment community, and others relating to the Company's financial statements
and the financial reporting process, the systems of internal accounting and
financial controls, the annual independent audit of the Company's financial
statements, and the legal compliance and ethics programs as established by
management and the board. In so doing, it is the responsibility of the Committee
to maintain free and open communication between the Committee, independent
auditors and management of the Company. In discharging its oversight role, the
Committee is empowered to investigate any matter brought to its attention with
full access to all books, records, facilities, and personnel of the Company and
the power to retain outside counsel, or other experts for this purpose.
Responsibilities and Processes
The primary responsibility of the Committee is to oversee the Company's
financial reporting process on behalf of the board and report the results of
their activities to the board. Management is responsible for preparing the
Company's financial statements, and the independent auditors are responsible for
auditing those financial statements. The Committee in carrying out its
responsibilities believes its policies and procedures should remain flexible, in
order to best react to changing conditions and circumstances. The
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Page Two
Committee should take the appropriate actions to set the overall corporate
"tone" for quality financial reporting, sound business risk practices, and
ethical behavior.
The following shall be the principal recurring processes of the Committee in
carrying out its oversight responsibilities. The processes are set forth as a
guide with the understanding that the Committee may supplement them as
appropriate.
o The Committee shall have a clear understanding with management and the
independent auditors that the independent auditors are ultimately
accountable to the board and the Committee, as representatives of the
Company's shareholders. The Committee shall have the ultimate authority and
responsibility to evaluate and, where appropriate, replace the independent
auditors. The Committee shall discuss with the auditors their independence
from management and the Company and the matters included in the written
disclosures required by the Independence Standards Board. Annually, the
Committee shall review and recommend to the board the selection of the
Company's independent auditors, subject to shareholders' approval.
o The Committee shall discuss with the independent auditors the overall scope
and plans for their audits including the adequacy of staffing and
compensation. Also, the Committee shall discuss with management and the
independent auditors the adequacy and effectiveness of the accounting and
financial controls, including the Company's system to monitor and manage
business risk, and legal and ethical compliance programs. Further, the
Committee shall meet separately with the independent auditors, with and
without management present, to discuss the results of their examinations.
o The Committee shall review the interim financial statements with management
and the independent auditors prior to the filing of the Company's Quarterly
Report on Form 10-Q. Also, the Committee shall discuss the results of the
quarterly review and any other matters required to be communicated to the
Committee by the independent auditors under generally accepted auditing
standards. The chair of the Committee may represent the entire committee
for the purposes of this review.
o The Committee shall review with management and the independent auditors the
financial statements to be included in the Company's Annual Report on Form
10-K, or the annual report to shareholders if distributed prior to the
filing of Form 10-K, including their judgment about the quality, not just
acceptability, of accounting principles, the reasonableness of significant
judgments, and the clarity of the disclosures in the financial statements.
Also, the Committee shall discuss the results of the annual audit and any
other matters required to be communicated to the Committee by the
independent auditors under generally accepted auditing standards.
R. James P. Morton, Chairman
Audit Committee
E-4
EXHIBIT 2.00
DENISON INTERNATIONAL plc
ANNUAL GENERAL MEETING OF MEMBERS AND SHAREHOLDERS
FORM OF PROXY
- --------------------------------------------------
(Name of ADR Holder)
- ---------------------------------------------------
(Number of ADR's held)
Issues presented for consideration at the Annual
General Meeting of Members and Shareholders to be held on May 28, 2002
VOTING RESULTS
Affirmative Negative Abstained
- ------------------------------------------------------------- --------------- --------------- ---------------
1) To re-appoint Christopher H. B. Mills as a director
- ------------------------------------------------------------- --------------- --------------- ---------------
2) To re-appoint Bruce A. Smith as a director
- ------------------------------------------------------------- --------------- --------------- ---------------
3) To re-appoint Ernst & Young LLP as auditors
- ------------------------------------------------------------- --------------- --------------- ---------------
4) Approve a resolution authorizing the Company to enter
into a contingent purchase contract to enable the Company
to buy back its own shares (s 165 Companies Act 1985)
- ------------------------------------------------------------- --------------- --------------- ---------------
- --------------------------------------------------
(Signed)
- ---------------------------------------------------
(Date)
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Draft
EXHIBIT 3.00
DATED o 2002
DENISON INTERNATIONAL plc
and
ABN AMRO SECURITIES LLC, its successors or assigns
---------------------------------------
CONTINGENT PURCHASE CONTRACT
FOR THE PURCHASE OF UP TO 1,056,770
SHARES OF US$0.01 EACH IN THE
CAPITAL OF DENISON INTERNATIONAL plc
----------------------------------------
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THIS AGREEMENT is made on [ ]
BETWEEN:
(1) DENISON INTERNATIONAL plc (registered number 2798239) whose registered
office is at Masters House, 107 Hammersmith Road, London W14 OQH (the
"Company"); and
(2) ABN AMRO SECURITIES LLC, its successors or assigns, whose US offices are
located at 55 E. 52nd Street, New York, NY 10055 (the "Vendor")
WHEREAS:
(A) The Company is a public company limited by shares having an authorized share
capital of (pound)57,000 divided into 7,125 "A" Ordinary Shares of (pound)8
each ("Ordinary Shares") and US$150,000 divided into 15,000,000 Ordinary
Shares of US$0.01 each ("$ Shares") of which 7,015 Ordinary Shares and
10,567,700 $ Shares have been issued fully paid or credited as fully paid.
(B) Pursuant to and in accordance with the terms of the Amended and Restated
Restricted Deposit Agreement dated 4th August 1997 between inter alia the
Company and Bankers Trust Company, a bank organized under the laws of the
State of New York (the "Deposit Agreement" and "Depositary" respectively),
the 10,567,700 issued $ Shares (such shares being referred to in the Deposit
Agreement as "Restricted American Depositary Shares ("ADS's")) are held by
the Depositary in the form of share warrants to bearer, the beneficial
ownership of which being evidenced by the issue by the Depositary of
American Depositary Receipts ("ADR's") on the basis of one ADR for every one
ADS held.
(C) Subject to the conditions in clause 1 below, the Company wishes to purchase,
and the Vendor wishes to sell up to 1,056,770 of such $ Shares on the terms
and conditions set out below.
(D) The Company is authorized to purchase its own shares pursuant to article 11
of the Company's articles of association.
(E) A copy of this agreement has been available for inspection by the members of
the Company at its registered office for not less than 15 days ending with
28th May, 2002 and was similarly available at the annual general meeting of
the Company held on that date at which the terms of this agreement were
authorized by special resolution of the Company in accordance with section
164 of the Companies Act 1985 (the "Act").
(F) The consideration for the purchase of any of the $ Shares is proposed to be
provided out of the distributable profits of the Company.
IT IS AGREED as follows:
1. Conditions Precedent
Each sale and purchase of any of the $ Shares is conditional on:
(a) the Company having notified the Vendor at any time prior to 31st
October, 2003 by one or more notices (in the form set out in Appendix 1)
that it wishes to purchase up to a specified number of $ Shares and the
price or the range of prices and a maximum price at or within which the
Vendor shall acquire the ADRs representing such shares; and
E-7
(b) following receipt by the Vendor of any notice pursuant to paragraph (a)
above, the Vendor having notified the Company at any time prior to 7th
November, 2003 by one or more notices (in the form set out in Appendix
2) ("Vendor's Notice") that it has acquired a specified number of ADRs
(the "Sale ADRs") in accordance with paragraph (a) above and that
pursuant to and in accordance with the relevant provisions of the
Deposit Agreement, such ADRs have been surrendered to the Depositary and
that the Vendor is the holder of share warrants to bearer in respect of
a specified number of $ Shares (the "Sale Shares").
2. Sale and Purchase
Subject to the satisfaction of the conditions in clause 1, the Vendor
shall sell, and the Company shall purchase, the Sale Shares at an
aggregate price, payable in cash in US dollars, equal to the aggregate
of (i) the consideration paid by the Vendor for the Sale ADRs and (ii)
a commission-equivalent markup of US [ ] per share and (iii) a
conversion fee of US [ ] per share (together, the "Purchase Price").
3. Warranties and Covenants
(1) The Vendor warrants that as at completion of each purchase of Sale
Shares (as referred to in clause 4 below) it will be the beneficial
owner of the number of Sale Shares specified in the relevant Vendor's
Notice and that such Sale Shares will be free from any lien, charge or
encumbrance.
(2) The Vendor covenants that all purchases of Sale ADRs by it hereunder
shall be made in accordance with all applicable US securities laws,
including but not limited to Rule 10b-18 under the US Securities
Exchange Act of 1934, as amended (the "Exchange Act") and Regulation M
under the Exchange Act.
(3) Each party warrants to the other that this Agreement has been duly
authorized, executed and delivered by such Party, and constitutes the
legal, valid and binding obligation of such Party, enforceable against
it in accordance with its terms.
4. Completion
(1) Completion of each sale and purchase of the Sale Shares shall be
effected on the business day next following receipt by the Company of
the relevant Vendor's Notice, at a place to be agreed between the
Company and the Vendor, by:
(a) the Vendor delivering to the Company the share warrants to bearer
representing the Sale Shares referred to in the Vendor's Notice;
and
(b) the Company paying to the Vendor the Purchase Price.
(2) As soon as is reasonably practicable after completion the Company shall
(if applicable) alter its register of members so as to show that the
relevant Sale Shares have been cancelled in accordance with section
160(4) of the Act.
5. Costs
Each of the Company and the Vendor shall bear all professional costs
and charges relating to this agreement respectively incurred by them
and the Company shall also pay all stamp duties falling due in respect
of the completion of the purchase of the Sale Shares in accordance with
this agreement.
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6. Service of Notices
Any notice to be served under this agreement shall be validly served if
delivered or if sent by first class post, recorded delivery post or
facsimile process if addressed to the Company at its US Executive
Offices located at 14249 Industrial Parkway, Marysville, Ohio 43040,
Attention: Chief Financial Officer (facsimile number 937-644-0827) or,
if addressed to the vendor to ABN AMRO Securities LLC at 55 E. 52nd
Street, New York, NY 10005, attention Michael C. Walters, Managing
Director (facsimile number 212-409-5059), with a copy to Ralph
Martinez, Director (facsimile number 404-364-5255). Any notice shall be
deemed to have been served:
(a) if delivered, at the time of delivery;
(b) if posted, on the third business day after it was put in the post; or
(c) if sent by facsimile process at the expiration of two hours after the
time of dispatch.
7. Termination
This agreement shall terminate on 7th November, 2003 (the "Termination
Date") as from which date neither of the parties will have any rights,
liabilities or obligations under this agreement save in respect of any
Vendor's Notice received or deemed received by the Company prior to the
Termination Date.
8. General
(1) The headings in this agreement are for convenience only and shall not
affect its construction.
(2) This agreement is governed by and shall be construed in accordance
with the laws of England and Wales.
AS WITNESS the hands of the duly authorized representatives of the parties on
the date, which appears first on page 1.
SIGNED by o
for and on behalf of
DENISON INTERNATIONAL plc
SIGNED by o
for and on behalf of
ABN AMRO SECURITIES LLC
E-9
APPENDIX 1
To: o
Pursuant to clause 1(a) of the Contingent Purchase Contract made between us and
dated May 28, 2002 (the "Contract"), we hereby notify you that:
1. We wish to purchase up to [ ] $ Shares as defined in, and on
the terms and subject to the conditions of, the Contract;
2. All purchases of $ Shares shall be made in accordance with all applicable US
securities laws, including but not limited to Regulation M and the safe
harbor afforded by Rule 10b-18 under the US Securities Exchange Act of 1934,
as amended; and
3. The maximum price which you may purchase ADRs representing $ Shares shall be
US$[ ] per ADR.
Dated:
Signed:.....................................
A duly authorized director
for and on behalf of
Denison International plc
E-10
APPENDIX 2
To: The Directors
Denison International plc
Masters House
107 Hammersmith Road
London W14 0QH
England
Pursuant to clause 1(b) of the Contingent Purchase Contract made between us and
dated May 28, 2002 (the "Contract"), we hereby notify you as follows:
1. We have acquired [ ] ADRs representing [ ] Sale
Shares, as defined in the Contract at a price or prices and on the dates
specified below.
Date(s) ADR(s) Price paid No. of ADRs Total purchase price
Purchased per ADR $ purchased
[ ] [ ] [ ] [ ]
2. Pursuant to and in accordance with the relevant provisions of the Deposit
Agreement (as so defined) we have surrendered the above-mentioned ADRs to
the Depositary and that we are the holder of a share warrant to bearer in
respect of [ ] $ Shares.
Dated:
Signed:....................................
A duly authorized signatory
for and on behalf of
ABN AMRO Securities LLC