-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LGCvbzZSkog3am2/ST9fYuM9Pk/AcG/GgNbCVsSlaeZmbbRKJFVuJTmD4YRYDkIM oNK7wJCGNVtNhyvD+NtCFA== 0000950137-98-001421.txt : 19980423 0000950137-98-001421.hdr.sgml : 19980423 ACCESSION NUMBER: 0000950137-98-001421 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980405 FILED AS OF DATE: 19980402 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CTB INTERNATIONAL CORP CENTRAL INDEX KEY: 0001038005 STANDARD INDUSTRIAL CLASSIFICATION: 3532 IRS NUMBER: 351970751 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 000-22973 FILM NUMBER: 98586189 BUSINESS ADDRESS: STREET 1: STATE ROAD 15 NOETH STREET 2: P O BOX 2000 CITY: MILFORD STATE: IN ZIP: 46542 BUSINESS PHONE: 2196584191 MAIL ADDRESS: STREET 1: STATE ROAD 15 NORTH STREET 2: P O BOX 2000 CITY: MILFORD STATE: IN ZIP: 46542 DEF 14A 1 NOTICE & PROXY STATEMENT 1 SCHEDULE 14A (RULE 14a-101) INFORMATION REQUIRED IN PROXY STATEMENT SCHEDULE 14A INFORMATION PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. ) Filed by the registrant [X] Filed by a party other than the registrant [ ] Check the appropriate box: [ ] Preliminary proxy statement [ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) [X] Definitive proxy statement [ ] Definitive additional materials [ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12 CTB INTERNATIONAL - - - -------------------------------------------------------------------------------- (Name of Registrant as Specified in Its Charter) CTB INTERNATIONAL - - - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of filing fee (Check the appropriate box): [X] No fee required. [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. (1) Title of each class of securities to which transaction applies: - - - -------------------------------------------------------------------------------- (2) Aggregate number of securities to which transaction applies: - - - -------------------------------------------------------------------------------- (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): - - - -------------------------------------------------------------------------------- (4) Proposed maximum aggregate value of transaction: - - - -------------------------------------------------------------------------------- (5) Total fee paid: - - - -------------------------------------------------------------------------------- [ ] 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: - - - -------------------------------------------------------------------------------- 2 March 31, 1998 To the Stockholders of CTB International Corp.: You are cordially invited to attend the Annual Meeting of Stockholders of CTB International Corp (the "Company") to be held on Tuesday, May 5, 1998, at 11:00 a.m. E.S.T., at the CTB Conference Center, State Road 15 North, Milford, Indiana. At the meeting, Stockholders will vote on the election of seven persons to the Board of Directors and the ratification of the selection of Deloitte & Touche LLP as independent accountants for the coming year. Details can be found in the accompanying Notice and Proxy Statement. We hope you are planning to attend the Annual Meeting personally and we look forward to meeting with you. Please check the appropriate "attendance" box on your proxy card. However, because the vote of each Stockholder is of utmost importance, we kindly request that you complete, date and sign your proxy card and return it to us promptly in the enclosed envelope, whether or not you currently plan to attend the Annual Meeting. You may revoke your proxy at any time before it is voted by giving written notice to the Secretary of the Company, by filing a properly executed proxy bearing a later date, or by voting in person at the Annual Meeting. On behalf of the Board of Directors and management of CTB International Corp. I would like to extend our appreciation for your continued support and confidence. Truly yours, CTB INTERNATIONAL CORP. J. Christopher Chocola President and Chief Executive Officer 3 CTB INTERNATIONAL CORP. STATE ROAD 15 NORTH MILFORD, IN 46542-2000 219-658-4191 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO THE STOCKHOLDERS OF CTB INTERNATIONAL CORP: NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of CTB International Corp. (the "Company"), will be held at the CTB Conference Center, State Road 15 North, Milford, Indiana, on Tuesday, May 5, 1998, at 11:00 a.m. E.S.T. for the following purposes: 1. To elect directors for a term of one (1) year; 2. To ratify the selection by the Board of Directors of Deloitte & Touche LLP as independent auditors for the Company for the year ending December 31, 1998. 3. To transact any other business that may properly be brought before the meeting or any adjournment thereof. The Stockholders of record, as of the close of business on March 25, 1998, of the Company's common stock, are entitled to notice of, and to vote at, the Annual Meeting and all adjournments thereof. By Order of the Board of Directors, Michael J. Kissane Secretary March 31, 1998 Milford, Indiana YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWNED ON THE RECORD DATE. PLEASE COMPLETE, SIGN, DATE, AND RETURN PROMPTLY THE ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE PREPAID ENVELOPE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. 4 CTB INTERNATIONAL CORP. PROXY STATEMENT ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 5, 1998 The enclosed proxy accompanying this Proxy Statement is solicited by and on behalf of the Board of Directors of CTB International Corp. (the "Company") for use at the 1998 Annual Meeting of Stockholders to be held on May 5, 1998 at 11:00 a.m. at the Company's Conference Center in Milford, Indiana, or any adjournment thereof. This Proxy Statement and accompanying form of proxy were first mailed on or about April 3, 1998 to stockholders of record (the "Stockholders" or, individually, "Stockholder") as of March 25, 1998 (the "Record Date"). The only outstanding class of voting securities of the Company is its common stock, par value $0.01 per share (the "Common Stock"). There were 12,782,490 shares of the Company's Common Stock outstanding as of the close of business on the Record Date. Stockholders shall be entitled to cast one vote per share for election of Directors and one vote per share on all other matters. A Stockholder who gives a proxy may revoke it at any time prior to its exercise by filing with the Secretary of the Company a written revocation or a duly executed proxy bearing a later date. The proxy may also be revoked if the Stockholder attends the meeting and elects to vote in person. Proxies that are signed but unmarked will be voted as recommended by the Board of Directors. A majority of the outstanding shares of Common Stock, present in person or by proxy and entitled to vote, will constitute a quorum for the transaction of business at the Annual Meeting. PRINCIPAL STOCKHOLDERS The following table sets forth certain information with respect to the beneficial ownership of the Common Stock as of March 25, 1998, for (i) each person known by the Company to beneficially own more than 5% of the Common Stock, (ii) each of the Company's directors, (iii) the Company's Chief Executive Officer, (iv) each of the Company's four other most highly compensated executive officers for 1997, and (v) all current directors and executive officers as a group. Unless otherwise noted, the address of each of the Stockholders named below is the Company's principal executive office.
NUMBER PERCENT OF OF NAME OF BENEFICIAL OWNER SHARES SHARES ------------------------ ------ ------- American Securities Partners G.P. (Management) Corp.(1).............................................. 4,127,189 31.9% ASP/CTB G.P. Corp.(2)................................... 454,706 3.5% Michael G. Fisch(1)(2).................................. 4,581,895 35.4% Charles D. Klein(1)(2).................................. 4,581,895 35.4% Caryl M. Chocola(3)..................................... 1,541,301 11.9% J. Christopher Chocola.................................. 706,987 5.5% Don J. Steinhilber...................................... 45,659 0.4% Roger W. Townsend....................................... 31,901 0.2% Frank S. Hermance....................................... 1,000 -- Robert W. Martin........................................ 500 -- Larry D. Greene......................................... 300 -- David L. Horing......................................... -- -- Bruce H. Marshall....................................... -- -- All directors and executive officers as a group......... 6,998,278 54.1%
- - - ------------------------- (1) Shares of Common Stock shown as beneficially owned by American Securities Partners G.P. (Management) Corp. are owned of record by American Securities Partners, L.P., of which American Securities Associates, L.P., ("ASALP") is the sole general partner and possesses sole voting and investment power. 1 5 American Securities Partners G.P. (Management) Corp. is the sole general partner of ASALP and possesses sole voting and investment power. Messrs. Klein and Fisch as stockholders of American Securities Partners G.P. (Management) Corp., may be deemed to have beneficial ownership of the shares shown as beneficially owned by American Securities Partners G.P. (Management) Corp. Such persons disclaim beneficial ownership of such shares. (2) Shares of Common Stock shown as beneficially owned by ASP/CTB G.P. Corp. are owned of record by ASP/CTB L.P. of which ASP/CTB G.P. Corp. is the sole general partner and as to which it possesses sole voting and investment power. Messrs. Klein and Fisch, as stockholders of ASP/CTB G.P. Corp., may be deemed to have beneficial ownership of the shares shown as beneficially owned by ASP/CTB G.P. Corp. Such persons disclaim beneficial ownership of such shares. (3) Shares of Common Stock shown as beneficially owned by Caryl M. Chocola are owned of record by the "Caryl M. Chocola Michigan Trust", of which Caryl M. Chocola is the sole beneficiary. PROPOSAL NO. 1 -- ELECTION OF DIRECTORS The Company's Bylaws provide for a Board of seven (7) members. There are currently seven members of the Board of Directors. Directors are elected annually by a plurality of votes by the Stockholders present or represented at the annual meeting and entitled to vote. Each director holds office for a term of one year or until his/her successor is elected or qualified. The Board of Directors has nominated and recommends the election of the seven nominees listed below. All current directors are being renominated for election to another term as a director. The name, age, business background and tenure as a director of the Company of each nominee are set forth below. If, at the time of the meeting, any of such nominees should be unable to or decline to serve, the discretionary authority provided in the proxy will be exercised to vote for a substitute or substitutes chosen by the Board. The nominees for director have consented to serve, if elected, and the Company has no reason to believe that any substitute nominee or nominees will be required. Unless authority 2 6 to vote for a nominee is expressly withheld, the accompanying Proxy will be voted FOR the nominees named below.
PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE DIRECTOR NOMINEES DURING THE PAST FIVE YEARS AGE SINCE -------- -------------------------------------------- --- -------- Caryl M. Chocola............... President of K.C. Equine Systems Inc., a provider of 59 1976 fencing and horse feeder equipment since 1993. Director of the Company and the Predecessor Company since 1976. J. Christopher Chocola......... President of the Company since 1996 and CEO of the 36 1991(1) Company or its predecessor since March 1994. Executive Vice President of the Company from November 1993 to July 1996. General Manager of the Chore-Time division from October 1991 to November 1993. Michael G. Fisch............... Chairman of the Board of the Company since 1995. 35 1995(1)(3) President of American Securities Capital Partners, L.P., ("ASCP") since 1994 and a Managing Director of American Securities, L.P., since 1993. Chairman of the Board of Caribbean Restaurants Holdings, Inc., a Burger King franchisee, and is a director of Culligan Water Technologies, Inc. (NYSE), a water filtration equipment manufacturer, MVE Holdings, Inc., a manufacturer of cryogenic storage vessels, Caire, Inc., a medical supply company, and Ketema, Inc., a diversified industrial company. Larry D. Greene................ Senior Vice President of Tauber Enterprises, a 41 1997(2)(3) private investment company, since 1992. Executive Vice President and Chief Operating Officer of Sinai Health System, a health care company, from 1988 until 1992. Director of Complex Tooling & Moulding, Inc., an injection molder of plastic components. Frank S. Hermance.............. President and Chief Operating Officer of AMETEK, 49 1997(2)(3) Inc. (NYSE), a diversified industrial company, since November 1996, Executive Vice President and Chief Operating Officer from January 1996 until November 1996. President of Precision Instruments Group from 1994 until 1996, and Group Vice President from 1990 until 1994 of AMETEK, Inc. David L. Horing................ A Managing Director of ASCP since 1997 and a 35 1995(1)(2) Principal of ASCP from 1995 to 1997. Manager of The Dyson-Kissner-Moran Corporation, a private investment firm, from 1988 until 1995. Director of the general partner of Community Pacific Broadcasting Company, L.P., a radio broadcaster, and of Caribbean Restaurants Holdings, Inc. Charles D. Klein............... A financial advisor to the William Rosenwald family 59 1995 and a Managing Director of American Securities, L.P. and its affiliates since 1978. Director of AMETEK, Inc., Ketema, Inc., the general partner of Community Pacific Broadcasting Company, L.P., and Caribbean Restaurants Holdings, Inc.
- - - ------------------------- NOTES (1) Member of the Executive Committee (2) Member of the Audit Committee (3) Member of the Compensation Committee 3 7 INFORMATION ABOUT THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD Board of Directors: The Board of Directors held five regular meetings during the last year. The Board has three standing committees: the Executive Committee, the Audit Committee and the Compensation Committee. Each Director has attended at least 75% of all committee and Board meetings. (1) Executive Committee: The Executive Committee is responsible for meeting, when required, on short notice during intervals between meetings of the Board of Directors and has authority to exercise all of the powers of the Board of Directors in the management and direction of the affairs of the Company subject to specific directions of the Board of Directors and to the limitations of the Delaware General Corporation Law. The Executive Committee met one time during the last year. (2) Audit Committee: The Audit Committee is responsible for making recommendations to the Board of Directors regarding the selection of independent auditors to audit the Company's annual financial statements, conferring with the independent auditors and reviewing the scope and the fees of the annual audit, reviewing the Company's audited financial statements, accounting and financial procedures, monitoring the Company's internal controls procedures and approving the nature and scope of nonaudit services performed by the independent auditors. The Audit Committee met two times during the past year. (3) Compensation Committee: The Compensation Committee is responsible for reviewing and making recommendations to the Board of Directors on matters concerning compensation of management, executive officers and employees. The Compensation Committee met one time during the past year. Each director of the Company who is not an employee of the Company or an employee of American Securities, L.P. or its affiliates (hereafter collectively "American Securities") receives an annual fee of $10,000 plus a fee of $2,500 for each Board of Directors meeting attended and $2,500 for each committee meeting attended if not held concurrently with a meeting of the Board of Directors. Directors who are also employees of the Company or who are officers or employees of American Securities receive no remuneration for serving as directors. Messrs. Greene and Hermance, the only directors who were entitled to compensation in 1997, also were each granted an option to purchase 18,140 shares of the Company's Common Stock at a price equal to the fair market value of the shares at the time of the grant, and subject to vesting in seven (7) years with a five (5) year accelerated vesting schedule based on the Company achieving certain financial targets. J. Christopher Chocola is the son of Caryl M. Chocola. 4 8 EXECUTIVE COMPENSATION The following Summary Compensation Table sets forth, for 1996 and 1997, certain information with respect to the compensation of the Company's President and Chief Executive Officer and the four other most highly compensated executive officers who served in such capacities for 1997. SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION ANNUAL COMPENSATION AWARDS --------------------------------- ------------ OTHER SECURITIES ALL NAME AND ANNUAL UNDERLYING OTHER PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION OPTIONS COMPENSATION(2) ------------------ ---- ------ -------- ------------ ---------- --------------- ($) ($) ($) (#) ($) J. Christopher Chocola....... 1997 148,500 101,155 -- -- 10,795 President, Chief Executive 1996 144,200 123,170 -- 72,560 11,091 Officer and Director Bruce W. Marshall............ 1997 125,000 65,413 16,264(3) -- 9,368 President of CTB 1996 20,000 -- -- 72,560 -- International Roger W. Townsend............ 1997 116,700 79,894 -- -- 8,573 Executive Vice President 1996 113,300 96,766 -- 108,840 8,764 and General Manager -- Grain Systems of CTB, Inc. Don J. Steinhilber........... 1997 106,500 54,051 -- -- 7,733 Vice President, 1996 90,492 64,762 -- 72,560 6,940 Chief Financial Officer Robert W. Martin............. 1997 103,000 53,906 23,245(3) -- 8,198 Executive Vice President 1996 82,244 64,017 19,557(3) -- 6,267 of CTB, Inc.
- - - ------------------------- (1) Includes amounts paid pursuant to the Management Incentive Compensation Plan and includes a holiday bonus of 5% of base salary payable to all employees in December with 1,000 hours of service for the twelve months ended November 30. (2) Includes amounts (i) contributed under the Profit Sharing Plan that are determined based on the Company's results of operations, (ii) contributed as matching contributions under the 401(k) Plan and (iii) determined to be imputed income on group-term life insurance policies. At the beginning of each year, the Board of Directors determines the rate, if any, that the Company will contribute to the Profit Sharing Plan for that year based on the achievement of certain financial targets for that year. The Company is not required to make any contribution to the Profit Sharing Plan if minimum levels of financial performance are not met. The contributions are allocated among eligible employees in proportion to their total qualified compensation. The Profit Sharing Plan also provides for the making of cash-or-deferred contributions pursuant to Section 401(k) of the Internal Revenue Code. Each year, the Company has the discretion to elect to make a matching contribution with respect to each employee. In recent years, the Company has made contributions equal to 50% of the amount contributed by such employee up to a total matching contribution of 2% of base compensation. The Company maintains a group-term life insurance plan for substantially all salaried employees. The Company makes the premium payments on the group-term life insurance policies which vary according to age and insurance coverage. The amount included as compensation for each named executive officer represents the value of coverage 5 9 in excess of $50,000.00, in accordance with Internal Revenue Code Section 79, during the covered year. The 1997 amounts of other annual compensation follow:
CONTRIBUTIONS CONTRIBUTIONS TO THE TO THE GROUP-TERM NAME PROFIT SHARING PLAN 401(K) PLAN LIFE INSURANCE ---- ------------------- ------------- -------------- ($) ($) ($) J. Christopher Chocola......................... 7,507 2,970 318 Bruce H. Marshall.............................. 6,319 2,500 549 Roger W. Townsend.............................. 5,899 2,334 340 Don J. Steinhilber............................. 5,384 2,130 219 Robert W. Martin............................... 5,207 2,060 931
(3) For temporary commuting and living expenses. AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND YEAR-END SAR VALUES
NUMBER OF SECURITIES VALUE OF UNEXERCISED SHARES UNDERLYING UNEXERCISED IN-THE-MONEY ACQUIRED ON VALUE OPTIONS/SARS AT OPTIONS/SARS AT NAME EXERCISE REALIZED FISCAL YEAR-END FISCAL YEAR-END ---- ----------- -------- ---------------------------- ---------------------------- # # $ $ # $ EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE J. Christopher Chocola...... -- -- 29,024 43,536 389,592 584,388 Bruce H. Marshall........... -- -- 14,512 58,048 134,796 539,185 Roger W. Townsend........... -- -- 43,536 65,304 584,388 876,582 Don J. Steinhilber.......... -- -- 29,024 43,536 389,592 584,388 Robert W. Martin............ -- -- -- -- -- --
6 10 REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION POLICIES AND OBJECTIVES The Compensation Committee of the Board of Directors (referred to herein as the "Committee") is responsible for administering the compensation and benefit programs for the Company's employees, including the executive officers. The Committee annually reviews and evaluates cash compensation and stock option grant recommendations made by the President and Chief Executive Officer for the executive officers (other than for himself) along with the rationale for such recommendations. The Committee examines these recommendations in relation to the Company's overall objectives and makes compensation recommendations to the Board of Directors for final approval. The Committee also sends to the Board of Directors for approval its recommendations on compensation for the President and Chief Executive Officer, who does not participate in the Committee's decisions as to his compensation package. GENERAL The Company has developed and implemented compensation policies, plans and practices that seek to attract and retain qualified and talented employees and enhance the profitability of the Company. The Company is committed to maximizing stockholder value through performance and the Committee believes that superior performance by the Company's executive and management team is an essential element to reaching that goal. The policies, plans and practices are designed to help achieve this objective by relating compensation to both Company and individual performance. Based on these objectives, the compensation package of the executive officers consists of four primary elements: (1) base salary; (2) incentive bonuses; (3) stock options; and (4) participation in employee benefit plans. BASE SALARY A base salary is set for each executive officer at the beginning of each calendar year by the Board of Directors after receiving a recommendation from the Committee. The Committee recommends to the Board of Directors what it believes to be an appropriate base salary for each executive officer based on the Company's performance, the executive officer's performance, the Company's future objectives and challenges and the current competitive environment. Base salaries are intended to be relatively moderate, but competitive. INCENTIVE BONUSES The Company's policy is to base a significant portion of each executive officer's annual compensation on the financial performance of the Company. A significant portion of each executive officer's potential annual cash compensation, ranging from approximately 25% to 60%, is based upon the incentive bonus which is accrued during the year and paid following the conclusion of each year. The bonus is determined on the basis of a formula which compares actual performance against Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") targets which are established by the Board of Directors at the beginning of each year. The target bonus for each executive officer is determined by the Committee based upon the goals, objectives and responsibilities of each officer. The Committee may exercise some discretion in making bonus awards. STOCK OPTIONS Stock options are a key element in the Company's long-term compensation program. The primary purpose of stock options is to provide executive officers and other employees with a personal and financial interest in the success of the Company through stock ownership, thereby aligning the interests of such persons with those of the Company's Stockholders. The executive officers were previously granted stock options which have a seven year vesting period, but which also have accelerated vesting in increments over 5 years or 6 years 7 11 if the Company achieves certain financial targets. There were no stock option grants to any named executive officers in 1997. BENEFIT PLANS The executive officers also participate in the Company's Profit Sharing Plan and 401(k) Plan described in Note 2 under the Summary Compensation Table. All executive officers and employees who are at least 18 years of age and have at least 1,000 hours of service are eligible to participate in the Profit Sharing Plan. Participation in the 401(k) Plan is immediately available to all employees (other than temporary employees) 18 years of age. All contributions to the Profit Sharing and 401(k) Plans are allocated to various investment alternatives, at the employee's discretion, within an account maintained on behalf of each participating employee and, to the extent vested, are distributed to the employee upon retirement, death, disability or termination of service. COMPENSATION OF THE PRESIDENT AND CHIEF EXECUTIVE OFFICER The compensation for the Company's President and Chief Executive Officer, J. Christopher Chocola, is established by the Committee and approved by the Board of Directors. The Committee considers the Company's success in achieving its performance goals as well as the Committee's and Board's assessments of Mr. Chocola's individual performance. Over the years, Mr. Chocola has received modest increases in his cash compensation, notwithstanding the strong financial results of the Company. Mr. Chocola has been granted stock options which are tied to Company financial performance targets for accelerated vesting purposes, the same as those for certain other executive officers and other employees. Mr. Chocola's incentive bonus is also tied to the same financial goals for the Company as applied to the other executive officers and other employees eligible for such bonuses. Notwithstanding an increase in the Company's sales and net income of approximately 36% and 63%, respectively, for 1997, the salary paid to Mr. Chocola increased less than 3% while his potential bonus level, as a percentage of base salary, remained the same. The Committee believes that the executive compensation programs and practices described above are conservative and fair to the Company's Stockholders. The Committee further believes that these programs and practices serve the best interests of the Company and its Stockholders. Respectfully submitted, Michael G. Fisch Larry D. Greene Frank S. Hermance 8 12 PERFORMANCE GRAPH The following graph compares the cumulative total return of CTB International Corp., the S&P Small Cap 600 Index, and a composite Peer Group Index constructed by the Company and weighted by market capitalization, which includes the following companies, but from which the Company has been excluded: Cal-Maine Foods, Inc.; Gehl Company; Lindsay Manufacturing Co.; Pilgrim's Pride Corp.; RDO Equipment Co.; Sanderson Farms, Inc.; Thorn Apple Valley, Inc.; Valmont Industries, Inc.; and WLR Foods, Inc. The total return assumes $100 invested in the Company's common stock, the S&P Small Cap Index and Peer Group Index on August 21, 1997. It includes reinvestment of dividends and is based on the closing stock price on the last trading day of December for the Company, the S&P Small Cap Index and the Peer Group Index. The comparative performance of the Company's common stock against the indices as depicted in this graph is dependent on the price of stock at a particular measurement point in time. Since individual stocks are more volatile than broader stock indexes, the perceived comparative performance of the Company's common stock may vary based on the strength or weakness of the stock price at the new measurement point used in each future proxy statement graph. For this reason, the Company does not believe that this graph should be considered as the sole indicator of Company performance. 9 13 CERTAIN TRANSACTIONS Under the terms of an agreement with ASCP, the Company pays annual management fees of $300,000 plus expenses to ASCP. Additionally, other fees paid by the Company to ASCP during 1997 pursuant to separate agreements consist of $503,000 in connection with the acquisitions of Fancom Holding B.V. and the Grain Systems Division of Butler Manufacturing Company; and $350,000 in connection with the Company's initial public offering of its common stock (the "Offering"). In conjunction with the Offering, certain Stockholders (including American Securities Partners, L.P., ASP/CTB, LP, J. Christopher Chocola and Caryl Chocola) redeemed 15,000 shares of preferred stock and exchanged 9,069 shares of preferred stock for 647,786 shares of common stock. COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 Section 16(a) of the Securities Exchange Act of 1934 requires the Company's Directors and officers, and persons who own more than 10 percent of a registered class of the Company's equity securities, to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of Common Stock, and to furnish the Company with copies of all such reports they file. To the Company's knowledge, based solely on a review of the copies of such reports furnished to the Company and written representations that no other reports were required, during the year ended December 31, 1997, all Section 16(a) filing requirements applicable to its officers, Directors, and greater than 10 percent beneficial owners were complied with. PROPOSAL NO. 2 -- RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS Subject to ratifications by the Stockholders, the Board of Directors has selected Deloitte & Touche LLP as independent auditors for the Company for the year ending December 31,1998. The Company has been advised by such firm that neither it nor any of its associates has any material direct or indirect financial interest in the Company. Deloitte & Touche LLP were the independent auditors for the Company for the years ended December 31, 1997 and 1996. 10 14 Representatives of Deloitte & Touche LLP, are expected to be present at the Annual Meeting and to be available to respond to appropriate questions concerning the audit for the year ended December 31, 1997. OTHER MATTERS The Board of Directors knows of no other matters to be presented for consideration at the meeting by the Board of Directors or by Stockholders who have requested inclusion of proposals in the Proxy Statement. If any other matter shall properly come before the meeting, the persons named in the accompanying form of proxy intend to vote on such matters in accordance with their judgment. STOCKHOLDER PROPOSALS Any Stockholder proposals intended to be presented at the 1999 Annual Meeting must be received by the Company at its principal executive offices no later than November 15, 1998 in order to be considered for inclusion in the proxy materials. 10-K REPORT A COPY OF THE COMPANY'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FORM 10-K IS AVAILABLE, WITHOUT CHARGE, UPON WRITTEN REQUEST TO DON J. STEINHILBER, VICE PRESIDENT AND CHIEF FINANCIAL OFFICER, CTB INTERNATIONAL CORP., P.O. BOX 2000, MILFORD, INDIANA 46542-2000, U.S.A. MARCH 31, 1998 11 15 to come -----END PRIVACY-ENHANCED MESSAGE-----