-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, a3VjjaFMRJC0TjFSkNgG0jULh3Xv0nwhQsSSPGsZfPOfApZSucqoRaSuShWvuUpN +32QNl4rq2ioF2X5CDMnaw== 0000905729-95-000019.txt : 19950414 0000905729-95-000019.hdr.sgml : 19950414 ACCESSION NUMBER: 0000905729-95-000019 CONFORMED SUBMISSION TYPE: DEFN14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950403 FILED AS OF DATE: 19950403 SROS: AMEX SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: HASTINGS MANUFACTURING CO CENTRAL INDEX KEY: 0000046109 STANDARD INDUSTRIAL CLASSIFICATION: 3714 IRS NUMBER: 380633740 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEFN14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-03574 FILM NUMBER: 95526622 BUSINESS ADDRESS: STREET 1: 325 N HANOVER ST CITY: HASTINGS STATE: MI ZIP: 49058 BUSINESS PHONE: 6169452491 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HASTINGS MANUFACTURING CO CENTRAL INDEX KEY: 0000046109 STANDARD INDUSTRIAL CLASSIFICATION: 3714 IRS NUMBER: 380633740 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEFN14A BUSINESS ADDRESS: STREET 1: 325 N HANOVER ST CITY: HASTINGS STATE: MI ZIP: 49058 BUSINESS PHONE: 6169452491 DEFN14A 1 SCHEDULE 14A INFORMATION REQUIRED IN PROXY STATEMENT SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 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 ___ Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)(2)) HASTINGS MANUFACTURING COMPANY ________________________________________________________________________________ (Name of Registrant as Specified in Its Charter) ________________________________________________________________________________ (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): _X_ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2), or Item 22(a)(2) of Schedule 14A. ___ $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: ________________________________________________________________________________ (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 file fee is calculated and state how it was determined): ________________________________________________________________________________ (4) Proposed maximum aggregate value of transaction: ________________________________________________________________________________ (5) Total fee paid: ________________________________________________________________________________ ___ Fee paid previously with preliminary materials. ___ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. (1) Amount previously paid: ________________________________________________________________________________ (2) Form, Schedule or Registration Statement No.: ________________________________________________________________________________ (3) Filing party: ________________________________________________________________________________ (4) Date filed: ________________________________________________________________________________ HASTINGS MANUFACTURING COMPANY 325 North Hanover Hastings, Michigan 49058 Telephone No. (616) 945-2491 Facsimile No. (616) 945-4667 _______________________________________________________________________________ NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 2, 1995 ________________________________________________________________________________ The Annual Meeting of Shareholders of Hastings Manufacturing Company, a Michigan corporation ("Hastings"), will be held at its principal office located at 325 North Hanover, Hastings, Michigan, on Tuesday, the 2nd day of May, 1995, at 2:00 p.m., local time, for the following purposes: 1. To elect two (2) directors for three year terms expiring in 1998. 2. To transact such other business as may properly come before the meeting. Only shareholders of record at the close of business on March 6, 1995, are entitled to notice of and to vote at the Annual Meeting of Shareholders or any adjournments thereof. Your attention is directed to the enclosed Proxy Statement and Proxy. The annual report of Hastings for the year ended December 31, 1994, is also enclosed. ALL SHAREHOLDERS ARE URGED TO COMPLETE, DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY IN THE POSTAGE-PAID ENVELOPE. THIS WILL ASSURE YOUR REPRESENTATION AND A QUORUM FOR THE TRANSACTION OF BUSINESS AT THE MEETING. IF YOU ATTEND THE MEETING AND VOTE IN PERSON, THIS PROXY WILL NOT BE USED. By Order of the Board of Directors MONTY C. BENNETT Secretary April 3, 1995 HASTINGS MANUFACTURING COMPANY 325 North Hanover Hastings, Michigan 49058 Telephone No. (616) 945-2491 Facsimile No. (616) 945-4667 ANNUAL MEETING OF SHAREHOLDERS MAY 2, 1995 PROXY STATEMENT INTRODUCTION This Proxy Statement and the enclosed Proxy are being furnished to holders of Common Stock, $2 par value per share ("Common Stock"), of Hastings Manufacturing Company ("Hastings" or the "Company") in connection with the solicitation of proxies by the Board of Directors of Hastings for use at the Annual Meeting of Shareholders to be held at 2:00 p.m., local time, on May 2, 1995, at its principal office located at 325 North Hanover, Hastings, Michigan, and any adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders. If a Proxy in the enclosed form is properly executed, returned to Hastings, and not revoked, the shares of Common Stock represented by the Proxy will be voted in accordance with the wishes specified in the Proxy. If no choice is specified, the designated proxies will vote the shares represented by the Proxy for the election of the two director nominees named in this Proxy Statement. Hastings' management does not know of any other matters to be presented at the Annual Meeting of Shareholders. If other matters are presented, the shares represented by the Proxy will be voted in the discretion of the designated proxies, who will take into consideration the recommendations of Hastings' management. Any shareholder who executes and delivers a Proxy may revoke it at any time before it is voted at the Annual Meeting by giving notice in writing directed to the Secretary of Hastings at the address set forth above, by submitting a Proxy bearing a later date, or by attending the meeting and voting in person. This Proxy Statement is being mailed to shareholders of Hastings on or about April 3, 1995. VOTING RIGHTS The Board of Directors fixed the close of business on Monday, March 6, 1995, as the record date for the determination of the shareholders entitled to notice of and to vote at the Annual Meeting of Shareholders to be held May 2, 1995, and any adjournments thereof. On March 6, 1995, 388,383 shares of Hastings Common Stock were issued and outstanding. Each share of Common Stock, the only class of voting securities presently outstanding, entitles its holder to one vote in person or by Proxy on each matter presented for shareholder action. -2- PRINCIPAL HASTINGS SHAREHOLDERS Security Ownership of Certain Beneficial Owners. The following table shows certain information concerning the number of shares of Common Stock held by the only shareholders who are known to Hastings' management to be the beneficial owners of more than 5 percent of the outstanding shares of Common Stock of Hastings as of March 6, 1995.
Name and Address Amount of Nature of Percent of of Beneficial Beneficial Beneficial Outstanding Owner of Common Stock Ownership Ownership Shares Stephen I. Johnson 640 shares Sole voting and investment power .16% Chairman of the Board 117,345 shares(1) Shared voting and investment power 30.21% Hastings Mfg. Co. 325 North Hanover Hastings, MI 49058 Mark R. S. Johnson 25,626 shares Sole voting and investment power 6.59% Co-CEO/ -0- shares Shared voting and investment power --- President-Marketing Hastings Mfg. Co. 325 North Hanover Hastings, MI 49058 The Stephen I. Johnson -0- shares Sole voting and investment power --- Family Group (2) 177,547 shares Shared voting and investment power 45.68% c/o Stephen I. Johnson Hastings Mfg. Co. 325 North Hanover Hastings, MI 49058 Dimensional Fund 17,900 shares Sole voting and investment power 4.61% Advisors, Inc. (3) 11,300 shares Shared voting and investment power 2.91% 1299 Ocean Ave. Suite 650 Santa Monica, CA 90401 Amici Associates and 25,900 shares Sole voting and investment power 6.67% The Collectors' Fund (4) -0- shares Shared voting and investment power --- 100 Park Avenue Suite 1105 _______________________________________ (1) This number does not include 14,111 shares as to which Mr. Johnson is a co-trustee along with two other persons as to a testamentary trust established by his father. This number includes shares held by the Stephen I. Johnson Trust, the Isabel Sage Johnson Trust, the Anna M. Johnson Trust and the Aben E. Johnson Trust, each for which Mr. Johnson is a trustee, and shares held by SAMCO, Inc., of which Mr. Johnson is the majority shareholder. -3- (2) On October 26, 1982, the Stephen I. Johnson Family Group ("Family Group") filed a report on Schedule 13D (the "Schedule 13D") with the Securities and Exchange Commission and the American Stock Exchange in connection with a tender offer which terminated in January of 1983. Amendment No. 2 to the Schedule 13D was filed with the Securities and Exchange Commission on or about April 1, 1993, reaffirming the Family Group's mutual belief that it is in the best interests of Hastings and its shareholders that Hastings remain an independently owned corporation. The Family group consists primarily of Stephen I. Johnson and family members and close relatives of Stephen I. Johnson. The Schedule 13D, as amended, contains a Shareholder Letter of Intent signed by all Family Group members. The Shareholder Letter of Intent states that Family Group members believe it is in the best interests of Hastings, its shareholders, its employees and the local community that Hastings remain an independently owned corporation and further states that Family Group members intend to oppose any takeover attempt that would result in Hastings no longer remaining an independently owned corporation and which is not in the best interest of Hastings, its shareholders, its employees or the local community. Family Group members and trusts for which such persons have or share voting power hold an aggregate of approximately 177,547 shares representing approximately 45.68% of the outstanding shares of Hastings Common Stock. (3) Based on information set forth in a report on Schedule 13G filed with the SEC. Persons who are officers of Dimensional Fund Advisors, Inc. also serve as officers of DFA Investment Dimensions Group Inc. In their capacity as officers of the Fund, these persons vote 17,900 shares held in trust and 11,300 shares which are owned by the Fund. The 17,900 shares are owned by investment advisory clients of Dimensional Fund Advisors, Inc., no one of which to the knowledge of Dimensional Fund Advisors, Inc. owns more than 5% of the class. (4) Based on information set forth in a report on Schedule 13D filed with the Securities and Exchange Commission.
Security Ownership of Management. The following table shows the beneficial ownership of shares of Hastings Common Stock, held as of March 6, 1994, by each director and nominee for election as director, each of the named executive officers and by all directors and executive officers of the Company as a group:
Amount of Percent of Name of Beneficial Nature of Outstanding Beneficial Owner Ownership Beneficial Ownership Shares Stephen I. Johnson 640 shares Sole voting and investment power .16% 117,345 shares(1) Shared voting and investment power 30.21% Mark R. S. Johnson 25,626 shares Sole voting and investment power 6.59% -0- shares Shared voting and investment power -- Andrew F. Johnson 4,916 shares Sole voting and investment power 1.26% -0- shares Shared voting and investment -- -4- William R. Cook 800 shares Sole voting and investment power .21% -0- shares Shared voting and investment power -- Robert H. Wallin 500 shares Sole voting and investment power .13% 900 shares Shared voting and investment power .23% Richard L. Foster -0- shares Sole voting and investment power -- 100 shares Shared voting and investment power .03% Monty C. Bennett 500 shares Sole voting and investment power .12% -0- shares Shared voting and investment power -- Dale W. Koop 500 shares Sole voting and investment power .11% -0- shares Shared voting and investment power -- Neil A. Gardner -0- shares Sole voting and investment power -- 10 shares Shared voting and investment power -- Douglas A. DeCamp 1,000 shares Sole voting and investment power .26% -0- shares Shared voting and investment power -- All directors and 33,882 shares Sole voting and investment power 8.72% executive officers 171,850 shares Shared voting and investment power 44.25% as group ___________________________ (1) This number does not include 14,111 shares as to which Mr. Johnson is a co-trustee along with two other persons as to a testamentary trust established by his father. This number includes shares held by the Stephen I. Johnson Trust, the Isabel Sage Johnson Trust, the Anna M. Johnson Trust and the Aben E. Johnson Trust, each for which Mr. Johnson is a trustee, and shares held by SAMCO, of which Mr. Johnson is the majority shareholder.
DIRECTORS Stephen I. Johnson and Neil A. Gardner have been nominated by the Board of Directors to be elected directors at the Annual Meeting of Shareholders for three-year terms to serve until the Annual Meeting of Shareholders in 1998 or until their successors are elected and qualified. Eight other directors are serving terms that will expire in 1996 and 1997. It is the intent of the designated proxies to vote for the election of the two nominees named in the table below. Each of these persons is willing to be nominated and to serve if elected. If any nominee should become unable or unwilling to serve, which is not contemplated, the incumbent Board of Directors may or may not select a substitute nominee. If a substitute nominee is selected, the Proxy will be voted for the election of the substitute nominee. If a substitute nominee is not selected, the Proxy will be voted for the election of the remaining nominee. Management has no reason to believe that any of the nominees will not be available for election. Proxies will not be voted for more than two nominees. -5- A plurality of votes of the holders of shares of Common Stock present in person or by proxy at the Annual Meeting and voting on the election of directors is required to elect directors. For the purpose of counting votes on the election of directors, abstentions, broker non-votes and other shares not voted will not be counted as shares voted on the election, and the number of votes of which a plurality is required will be reduced by the number of shares not voted. YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR ALL NOMINEES AS DIRECTORS. The following table shows certain information concerning each director and nominee for director, supplied by them as of December 31, 1994: Nominees to be Elected for Three-Year Terms Expiring in 1998
Principal Occupation Director Name and Age or Employment Since Stephen I. Johnson (75) Chairman of the Board of Hastings 1948 (since 1994). He previously served as President of Hastings from 1955 to 1994. Neil A. Gardner (48) Vice President of Hastings City Bank, 1983 Hastings, Michigan, a financial institution (since 1976). Incumbent Directors Terms Expiring in 1996 Principal Occupation Director Name and Age or Employment Since Andrew F. Johnson (45) Co-CEO/ President - Operations 1977 of Hastings (since 1994). He pre- viously served as Executive Vice President - Operations of Hastings from 1986 to 1994. William R. Cook (53) President of Pidgas, Inc., Hastings, 1977 Michigan, an office supply retailer (since 1994). He previously served as President of Hastings Press, Inc., a commercial printer, from 1975 to 1994. Monty C. Bennett (57) Vice President-Employee Relations 1982 (since 1986) and Secretary of Hastings (since 1982). -6- Richard L. Foster (67) Retired. He previously served as 1984 Production Control Manager of Hastings from 1987-1988. Incumbent Directors Terms Expiring in 1997 Principal Occupation Director Name and Age or Employment Since Mark R. S. Johnson (47) Co-CEO/President-Marketing 1977 of Hastings (since 1994). He previously served as Executive Vice President-Marketing from 1986 to 1994. Robert H. Wallin (63) Vice President-Sales of Hastings 1977 (since 1980) Dale W. Koop (56) Vice President-Engineering of Hastings 1982 (since 1982) Douglas A. DeCamp (57) President\CEO of FHI, Inc., (formerly 1984 known as Flexfab, Inc.), a producer of aircraft hosing and fiberglass products (since 1984)
Except as otherwise noted, all of the above-named persons have been engaged in their present occupations or employment for more than five years. There are no family relationships (closer than first cousin) between any of the above-named persons, except that Mark R. S. Johnson and Andrew F. Johnson are sons of Stephen I. Johnson. The Hastings Board of Directors does not have a standing committee for nominating individuals for election as directors. The Hastings Board of Directors selects its nominees for election to the new Board of Directors at its first meeting each year in either January or February. The Hastings Board of Directors will consider nominees recommended by shareholders. Any such nominations should be in writing and state the name, age and address of the nominee, his or her educational and employment background, his or her present employment, and a full and complete statement as to the qualifications of the nominee to serve as a director. The Board of Directors will not consider any nomination which does not provide this information. If a shareholder intends to make a nomination for election at the Annual Meeting of Shareholders, he or she must deliver a notice to the Secretary of the Company setting forth the required information concerning the proposed nominee at least 120 days prior to the date of the notice of the meeting. The Hastings Board of Directors has a standing Audit Committee composed of William R. Cook (Chairman), Neil A. Gardner, Mark R. S. Johnson, Douglas A. DeCamp and Richard L. Foster. The function of the Audit Committee is to recommend independent auditors to the Board of -7- Directors for the annual audit of Hastings and its subsidiaries, and to discuss the results of the audit with the independent auditors. The Audit Committee is responsible for causing suitable examinations of the financial records and operations of Hastings and its subsidiaries to be performed by the internal auditor and for reviewing internal controls to insure the objectivity of Hastings' financial statements. During 1994, the Audit Committee met three times. The Compensation Committee of the Board of Directors was created to determine if director and officer compensation by Hastings is comparable to industry standards and to make appropriate recommendations to the Board of Directors. This committee met once during 1994. The members consist of the three outside directors, plus Mark R. S. Johnson and Andrew F. Johnson as advisors. In 1994, the outside directors were William R. Cook, Douglas A. DeCamp and Neil A. Gardner. During 1994, there were 7 meetings of the Board of Directors. All incumbent directors attended at least 75% of the aggregate number of meetings of the Board of Directors and meetings of Committees on which they served during the year, except for Mr. Stephen I. Johnson, who attended 15% of such meetings. EXECUTIVE COMPENSATION The Company's executive officers are appointed annually by and serve at the pleasure of the Board of Directors. In May of 1994, Stephen I. Johnson resigned from the position of President of Hastings, a position he held for over 35 years. The Board of Directors expressed great appreciation for his years of service and for his consistent commitment and important contributions to the growth, prosperity and integrity of Hastings. Stephen I. Johnson has since assumed the position of Chairman of the Board. To fill the vacant office of President, the Board of Directors appointed Mark R. S. Johnson as Co-CEO/ President-Marketing and Andrew F. Johnson as Co-CEO/President-Operations. The compensation paid for the three years ended December 31, 1994, by Hastings to its chief executive officers and the only other officer of Hastings whose annual salary and bonus exceeded $100,000 for the year ended December 31, 1994, is presented below. SUMMARY COMPENSATION TABLE
Long-Term Compensation Restricted Name and Principal Annual Compensation Stock All Other Position Year Salary Bonus Awards(1) Compensation(2) Stephen I. Johnson 1994 $218,516 $ -0- $ -0- $46,006 Chairman of the Board 1993 167,280 47,258 -0- 45,892 1992 167,280 -0- -0- 49,896 -8- Mark R.S. Johnson 1994 191,379 -0- -0- 9,266 Co-CEO 1993 156,000 45,084 -0- 9,612 President - Marketing 1992 154,350 -0- -0- 9,120 Andrew F. Johnson 1994 191,379 -0- -0- 10,956 Co-CEO 1993 156,000 45,084 -0- 11,328 President-Operations 1992 154,350 -0- -0- 9,120 (1) No shares of restricted stock vested in 1994 as the performance goals were not met. (2) Amounts reported in the Summary Compensation Table as restricted stock awards are calculated by multiplying the market price of the Company's unrestricted stock on the date of grant by the number of shares awarded. Recipients of restricted stock have rights as shareholders including the right to receive dividends paid with respect to the restricted stock. As of December 31, 1994, the number and value of the aggregate restricted stock holdings for the named executive officers are as follows: Name Number of Shares Value as of 12/31/94 Stephen I, Johnson 40 $1,000 Mark R. S. Johnson 40 1,000 Andrew F. Johnson 40 1,000 (3) All other compensation includes: (a) Company matching contributions under the Hastings Savings Plan; (b) Company profit-sharing contributions to the Hastings Savings Plan; and (c) amounts paid by Hastings for whole life insurance. The amounts included for each in 1994 are: Name (a) (b) (c) Stephen I. Johnson $2,217.60 $7,788.01 $36,000 Mark R. S. Johnson $1,478.41 $7,788.01 -0- Andrew F. Johnson $3,168.00 $7,788.01 -0- [/FN]
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION The Company's executive compensation policy is formulated and recommended to the Board of Directors by the Compensation Committee of the Board of Directors (the "Committee"). The Committee also administers the Company's compensation plans. The Committee evaluates annual salaries and incentive compensation plans for the executive officers and recommends the salaries and compensation to the Board of Directors. The Board of Directors makes the final decision on whether to adopt the Committee's recommendations. Compensation Policies For Executive Officers The Compensation Committee's executive compensation philosophy is intended to provide competitive levels of compensation, tie officers' compensation to the achievement of the Company's performance objectives, reward good corporate performance, recognize individual achievement, and allow the Company to attract and retain quality executive officers. The -9- Committee's compensation policy provides that a significant portion of the annual compensation of each executive officer must relate to, and be contingent upon, the performance of the Company. The Committee believes that this policy enhances shareholder value by rewarding executive officers for profitable growth of the Company. Compensation for executive officers, including the Co-Chief Executive Officers, is comprised of three primary components: base salary, an annual incentive bonus, and awards of restricted stock. Executive officers also receive various fringe benefits that are offered to other employees including health, pension and life insurance benefits. The Company's defined contribution 401(k) profit sharing plan provides benefits based upon a percentage of the applicable officer's salary and bonus, and therefore the amount of the officer's retirement benefits are also partially tied to the Company's profitability and performance. Base Salary The Company seeks to attract and retain executives by providing base salaries that are generally competitive with salaries paid for comparable positions with companies of similar general type and size in the marketplace. The Company obtains comparable salary information through various surveys. The skill and experience required by the position, job performance, accountability, length of service and current economic conditions also affect what an officer earns as a base salary. In general, the Company reviews the base salary of executive officers on an annual basis. Annual salary adjustments are determined by evaluating comparable salaries for executives at other companies, the job performance of the officer, and any increase in responsibilities of the officer. Annual Cash Incentive Bonus The Company's executive officers may receive an annual cash incentive bonus which is based on the Company's performance and profitability gains during the prior fiscal year. This performance is based upon a reporting framework that treats factory labor and overhead as a current expense instead of passing factory labor and overhead through inventory. The Company believes that this framework affords a more timely reflection and indicator of performance goals and trends. Restricted Stock Plan The Company also provides executive officers and certain other key employees of the Company with incentives to increase the long-term profitability of the Company by awarding restricted stock under a restricted stock plan that was established in 1990 (the "Restricted Stock Plan"). The Committee believes that the Restricted Stock Plan helps to align the interests of the Company's executive officers and key employees with those of the Company and its shareholders by encouraging and promoting stock ownership by management. The Committee believes that the Restricted Stock Plan will result in better long-term performance for the Company and its shareholders. The Company currently has no target ownership level for equity holdings by officers. -10- The Restricted Stock Plan is administered by a committee (the "RSP Committee"), consisting of three outside directors who are not eligible to participate in the Restricted Stock Plan. Every award of Common Stock under the Restricted Stock Plan is subject to two types of restrictions. The first restriction is based on a continuation of employment for five years (except in the case of retirement with prior approval, death or disability). If the recipient fails to meet this vesting criteria, the recipient forfeits the unvested portion of any restricted stock held by him or her. Second, the vesting of a portion of each award of restricted stock is also tied to achievement of certain performance goals established by the RSP Committee. The performance goals may be company-wide, subsidiary-wide, division-wide, or tailored to the individual recipient. The performance goals have generally been based on the per share annual net income of the Company. If the Company (or the individual, if applicable) meets or exceeds the performance goals for a particular year, then the recipient will become the owner of 20% of his or her restricted stock award. If the Company (or the individual, if applicable) fails to meet the performance goals, then the recipient will forfeit all interest in 20% of his or her restricted stock award. In other words, as long as the Company (or the individual, if applicable) meets the performance goals, then the recipient may keep the shares of stock awarded to him or her under the Plan. During 1994, all recommendations of the Compensation Committee were unanimously approved by the Board of Directors without modification. Respectfully submitted, William R. Cook Douglas A. DeCamp Neil A. Gardner -11- STOCK PERFORMANCE The following graph compares the cumulative total shareholder return on Hastings Common Stock to the AMEX Market Index and Peer Group Index. The AMEX Market Index is a broad equity market index published by the American Stock Exchange. The Peer Group Index is based upon the cumulative total shareholder return on the common stock issued by selected companies in the automotive parts and accessories industry identified below the graph. The returns of each member of the Peer Group are weighted according to the respective issuer stock market capitalization at the beginning of each period for which a return is indicated. The AMEX Market Index and the Peer Group Index both assume dividend reinvestment. Cumulative total return is measured by dividing (i) the sum of (A) the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and (B) the difference between the share price at the end and the beginning of the measurement period; (ii) by the share price at the beginning of the measurement period. COMPARISON OF FIVE YEAR CUMULATIVE TOTAL SHAREHOLDER RETURN [STOCK PERFORMANCE GRAPH] The table below shows dollar values for cumulative total shareholder return plotted in the graph above.
1989 1990 1991 1992 1993 1994 Hastings $100.00 114.97 114.28 104.88 102.96 73.65 AMEX Market Index $100.00 82.17 105.11 149.76 211.06 182.15 Peer Group Index $100.00 84.80 104.45 105.88 125.79 111.12 ____________________ (1) The Peer Group companies used to create the Index are as follows: Airsensors Inc; Amerigon Inc; Arvin Industries Inc; Bailey Corporation; Barnes Group Inc; Bestop Inc; Borg Warner Automotive; Breed Technologies Inc; Capco Automotive Products; Champion Parts Inc; Code-Alarm Inc; Collins Industries Inc; Dana Corporation; Defiance Inc; Deflecta-Shield Corporation; Desc S.A.; Detroit Diesel Corporation; Donaldson Co., Inc; Durakon Industries Inc; Eaton Corporation; Echlin Inc; Edelbrock Corp; Excel Industries Inc; Federal-Mogul Corporation; Gentex Corporation; Harvard Industries Inc; Hastings Manufacturing Company; Hayes Wheels International Inc; Hilite Industries Inc; Jason Inc; JPE Inc; Kysor Industrial Corporation; Larizza Industries Inc; Lifetime Products Inc; Lund International Holdings; Magna International Inc; Mascotech Inc; Masland Corporation; Memtec Ltd; Modine Manufacturing Co; Monro Muffler Brake Inc; Motorcar Parts & Accessories Inc; Orbital Engine Corporation Ltd; R&B Inc; Redlaw Industries Inc; Rotary Power International; RT Industries Inc; Safety Components International; Schawk Inc; Schwitzer Inc; Simpson Industries Inc; Smith AO Inc; Sparton Corporation; SPX Corporation; Standard Motor Products Inc; Standard Products Co; Stant Corporation; Superior Industries International; Top Source Technologies Inc; Truck Components Inc; TRW Inc; Universal Manufacturing Inc; Valley Forge Corporation; Wescast Industries Inc; Williams Controls Inc; Wynn's International Inc.
-12- COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION The following non-employee directors were members of the Compensation Committee during 1994: William R. Cook; Douglas A. DeCamp; Neil A. Gardner. COMPENSATION OF DIRECTORS All directors who are not full-time employees of Hastings are paid a fee of $500 for each regular or special meeting of the Board of Directors and $500 for each committee meeting attended by the director. Directors who are full-time employees do not receive additional compensation. INDEPENDENT AUDITORS The Board of Directors has selected the firm of BDO Seidman, Grand Rapids, Michigan, as independent auditors to audit the consolidated financial statements of Hastings and its subsidiaries for the fiscal year ending December 31, 1995. BDO Seidman has served as independent auditors for Hastings since August 18, 1971. A representative of BDO Seidman is expected to attend the Annual Meeting of Shareholders on May 2, 1995. The representative will have an opportunity to make a statement if he or she so desires and is expected to be available to respond to appropriate questions from shareholders. COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT Section 16(a) of the Securities Exchange Act of 1934 requires Hastings' directors and officers and individuals who beneficially own more than 10 percent of the outstanding shares of Hastings Common Stock to file reports with the Securities and Exchange Commission concerning their beneficial ownership and changes in their ownership of shares of Hastings Common Stock. Such persons are required by Securities and Exchange Commission regulations to furnish to Hastings copies of all Section 16(a) reports they file. Based on its review of the copies of such reports received by it, or written representations from certain reporting persons that no Forms 5 were required for those persons, Hastings believes that, from January 1 through December 31, 1994, all Section 16 reporting and filing requirements were fulfilled. SHAREHOLDER PROPOSALS Any proposal that a Hastings shareholder intends to present at the Annual Meeting of Shareholders to be held in 1996 must be received by Hastings at its principal office not later than December 3, 1995, to be considered for inclusion in its Proxy Statement and form of Proxy relating to that meeting. Proposals of shareholders should be made in accordance with Securities and Exchange Commission Rule 14a-8. -13- MISCELLANEOUS The cost of soliciting Proxies will be borne by Hastings. Solicitation of Proxies will be made initially by mail. Directors, officers and employees of Hastings may solicit, without additional compensation, Proxies in person or by telephone, telegram, or oral communication. Proxies may be solicited by nominees and other fiduciaries who may mail materials to or otherwise communicate with the beneficial owners of shares held by them. Hastings may reimburse persons holding stock in their names or those of the nominees for their reasonable expenses in sending material to beneficial owners. It is important that your shares be represented at the meeting. To assure your representation, please complete, date, sign, and return promptly your proxy in the enclosed postage prepaid envelope. BY ORDER OF THE BOARD OF DIRECTORS MONTY C. BENNETT, Secretary -14- HASTINGS MANUFACTURING COMPANY 325 North Hanover Hastings, Michigan 49058 Telephone No. (616) 945-2491 PROXY FOR ANNUAL SHAREHOLDER MEETING May 2, 1995 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned shareholder of Hastings Manufacturing Company, a Michigan corporation ("Hastings"), does hereby constitute and appoint Stephen I. Johnson and Monty C. Bennett, and either of them, attorneys, agents and proxies of the undersigned, with full power of substitution to either, for and in the name of the undersigned and with all the powers the undersigned would possess if personally present, to vote upon and act with respect to all the shares of Common Stock of Hastings, standing in the name of the undersigned at the close of business on March 6, 1995, at the Annual Meeting of Shareholders of Hastings to be held at the principal office of Hastings located at 325 North Hanover, Hastings, Michigan, on May 2, 1995, at 2:00 p.m., local time, and at any and all adjournments thereof, all according to the number of shares the undersigned would be entitled to vote if then and there personally present, as follows (the Board of Directors recommends a vote "FOR" the nominees listed below): 1. The election of the two (2) nominees for directors listed below: ___ VOTE FOR ALL nominees listed below ___ WITHHOLD AUTHORITY to vote for all except as marked to the nominees listed below contrary below) (INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through the nominee's name below.) Stephen I. Johnson Neil A. Gardner 2. To consider and act upon any other business which may properly come before the meeting or any adjournment or adjournments thereof. In the event any nominee is unable or unwilling to serve as a director at the time of the Annual Meeting of Shareholders, each Proxy may be voted for any substitute nominee designated by the present Board of Directors. The attorneys, agents, and proxies named herein shall have discretionary authority to vote on other matters, not presently known, which may come before the meeting, and shall together and individually have and exercise all of the powers of said attorneys, agents and proxies granted hereby. Receipt of the Notice of Annual Meeting of Shareholders and Proxy Statement dated April 3, 1995, is acknowledged. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE, THE SHARES SHALL BE VOTED FOR ELECTION OF ALL NOMINEES NAMED IN THIS PROXY AS DIRECTORS AND IN ACCORDANCE WITH THE JUDGMENT OF THE PROXIES WITH RESPECT TO ANY OTHER MATTERS WHICH MAY COME BEFORE THE MEETING. The undersigned hereby revokes any prior proxy given to vote such shares at said meeting or at any adjournment thereof. Dated:____________________, 1995 X_____________________________________ X_____________________________________ (Signature of Shareholder(s)) NOTE: Signatures should be identical to the names on the stock certificate. Joint owners should each sign personally. Persons signing as attorney, executor, administrator, trustee or guardian should give full title as such. If a corporation, please sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by authorized person. PLEASE FILL IN, DATE, SIGN AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE TO HASTINGS MANUFACTURING COMPANY, 325 NORTH HANOVER, HASTINGS, MICHIGAN 49058. NO POSTAGE NEED BE AFFIXED IF MAILED IN THE UNITED STATES. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. For our records we would like your telephone number, if you desire to disclose it. (____) __________________ Your telephone number, including area code. -2- -----END PRIVACY-ENHANCED MESSAGE-----