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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-13894
TRANSPRO, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 34-1807383
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
100 Gando Drive, New Haven, Connecticut 06513
(Address of principal executive offices, including zip code)
(203) 401-6450
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12 (b) of the Act:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
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Common Stock, $.01 Par Value New York Stock Exchange
(together with associated Preferred Stock
purchase rights)
Securities registered pursuant to Section 12 (g) of the Act:
NONE
Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The aggregate market value of voting and non-voting common stock held by
non-affiliates of the Registrant at March 1, 2000 was $36,697,676. On that date,
there were 6,597,335 outstanding shares of the Registrant's common stock.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to stockholders for the fiscal year ended
December 31, 1999 are incorporated by reference into Part II hereof.
Portions of the Proxy Statement for the 2000 Annual Meeting of Stockholders
are incorporated by reference into Part III of this report.
Exhibit Index is on pages 17 through 19 of this report.
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TRANSPRO, INC.
INDEX TO ANNUAL REPORT
ON FORM 10-K
YEAR ENDED DECEMBER 31, 1999
PAGE
PART I
Item 1. Business 3
Item 2. Properties 12
Item 3. Legal Proceedings 13
Item 4. Submission of Matters to a Vote of Security Holders 13
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder 14
Matters
Item 6. Selected Financial Data 14
Item 7. Management's Discussion and Analysis of Financial Condition 14
and Results of Operations
Item 7A. Quantitative and Qualitative Disclosures about Market Risk 14
Item 8. Financial Statements and Supplementary Data 15
Item 9. Changes in and Disagreements with Accountants on Accounting 16
and Financial Disclosure
PART III
Item 10. Directors and Executive Officers of the Registrant 16
Item 11. Executive Compensation 16
Item 12. Security Ownership of Certain Beneficial Owners and Management 17
Item 13. Certain Relationships and Related Transactions 17
PART IV
Item 14. Exhibits, Financial Statement Schedule and Reports on Form 8-K 17
Signatures 20
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PART I
ITEM 1. BUSINESS
GENERAL DEVELOPMENT OF BUSINESS
On September 29, 1995, TransPro, Inc. (the "Company") completed a series of
transactions pursuant to which the Company's sole stockholder, Allen Telecom
Inc. ("Allen", formerly The Allen Group Inc.) contributed (the "Contribution")
to the Company substantially all of the assets and liabilities of Allen's
original equipment radiator and fabricated metal products business (the
"Automotive and Truck Products Business"), as well as Allen's 50% ownership
interest in GO/DAN Industries ("GDI"), then a 50/50 joint venture partnership
between affiliates of Allen and Handy & Harman that produces replacement
radiators and other heat transfer products for the automotive and truck
aftermarkets. Immediately thereafter, Allen caused GDI to redeem the outstanding
ownership interest in GDI not already owned by Allen (the "GDI Redemption");
thereby making GDI an indirect wholly owned partnership of the Company.
Effective April 1, 1999, GDI changed its organizational structure from a
partnership to a corporation.
In addition, Allen effected the distribution (the "Distribution") of 100% of
the outstanding shares of the Company's common stock to the holders of record of
Allen's common stock as of the close of business on September 29, 1995 (the
"Record Date"). The Distribution was made on the basis of one share of the
Company's common stock for every four shares of Allen's common stock outstanding
on the Record Date, which resulted in the distribution of an aggregate of
6,621,349 shares of TransPro common stock. As a result of the Contribution, the
Distribution, and the GDI Redemption, TransPro now owns the Automotive and Truck
Products Business and 100% of GDI, and is an independent publicly traded
company.
The Company operates in three business segments, Aftermarket Heating and
Cooling Systems, Original Equipment Manufacturer ("OEM") Heat Transfer Systems
and Specialty Metal Fabrication. The Company is comprised of five operating
divisions that supply products and services to the automotive and truck
aftermarkets and original equipment manufacturers of trucks, vans,
telecommunications equipment and other industrial products. The Aftermarket
Heating and Cooling Systems segment includes the Company's GO/DAN INDUSTRIES
division ("GDI"), a producer of replacement radiators and other heat transfer
products for the automotive and truck aftermarkets; the Company's EVAP, Inc.
("EVAP") division, a manufacturer and distributor of replacement automotive air
conditioning parts for the automotive aftermarket; and the Company's A/C Plus,
Inc. ("A/C Plus") division, a re-manufacturer of air conditioning compressors
primarily for import applications in the automotive aftermarket. The OEM Heat
Transfer Systems segment includes the Company's G&O Manufacturing Company
division ("G&O") which produces and supplies radiators, charge air coolers, and
engine cooling system components for OEMs of heavy duty trucks and industrial
and off-highway equipment. The Specialty Metal Fabrication segment includes the
Company's Crown divisions ("Crown") which install specialized interiors in
utility trucks and vans for major commercial fleets and designs, manufactures
and assembles fabricated metal parts for light truck, telecommunications and
other industrial customers.
The Company's origins date back to 1915 when G&O commenced operations in New
Haven, Connecticut as a manufacturer of radiators for custom built automobiles,
fire engines and original equipment radiators for Ford Motor Company ("Ford").
Allen acquired G&O in 1970 as part of its strategy to become a broad-based
automotive supplier. Crown commenced operations in 1947 and was acquired by
Allen in 1967 as part of the same business strategy. GDI was formed in 1990 when
Allen contributed a portion of its G&O division and other assets, which together
represented all of Allen's aftermarket radiator business, and Handy & Harman
contributed substantially all of the assets of its then wholly owned
subsidiaries, Daniel Radiator Corporation, Jackson Industries, Inc., Lexington
Tube Co., Inc. and US Auto Radiator Manufacturing Corporation, to form a 50/50
joint venture partnership. The Company added replacement automotive air
conditioning condensers to its aftermarket product line with the acquisition of
substantially all of the assets, and the assumption of certain liabilities, of
Rahn Industries effective August 1996. In December 1997, the Company acquired
substantially all of the assets and assumed certain liabilities of Vehicle
Management Systems Inc. ("VMS"), a small Canadian van upfitter, to extend its
geographic coverage for vehicle conversions into Canada. The Company added
replacement automotive air conditioning parts to its aftermarket product line
with the acquisition of
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the outstanding stock of EVAP in a purchase transaction effective August 1,
1998. The Company added re-manufactured automotive air conditioning compressors
to its aftermarket product line with the acquisition of the outstanding stock of
A/C Plus in a purchase transaction effective February 1, 1999.
The Company is concentrating on exploring strategic alternatives for our
Specialty Metal Fabrication business. As a result of the significant
improvements over the past three years at this business, we believe that now is
an opportune time to evaluate our options for this business and improve our
ability to fund the growth in the Aftermarket Heating and Cooling Systems
segment.
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DESCRIPTION OF BUSINESS
MARKETS
The automotive and heavy truck parts industries target two distinct markets,
the aftermarket and the OEM market. The products and services used to maintain
and repair automobiles, vans, light trucks and heavy trucks, as well as
accessories not supplied with such vehicles when manufactured, form the
respective automotive and heavy truck aftermarkets. The manufacture of
individual component parts for use in the original equipment manufacturing
process of automobiles, vans and light trucks forms the automotive OEM market
and the manufacture of individual components for use in the original equipment
manufacturing process of heavy trucks forms the heavy truck OEM market. The
Company believes that in recent years demand for replacement parts and supplies
in both the automotive and heavy truck aftermarkets has increased as both
individuals and commercial fleet operators are driving more and keeping their
vehicles longer. The Company sells its products and services principally to the
automotive and heavy truck aftermarkets, as well as the heavy truck OEM market.
The Company also sells its automotive products to OEM's of off-highway and
transportation equipment and other industrial customers. The Company also
manufactures fabricated enclosures and cabinetry for the OEM telecommunications
industry.
PRINCIPAL PRODUCTS AND SERVICES
The Company designs, manufactures and markets radiators, heater cores, air
conditioning parts (including condensers, compressors, accumulators and
evaporators) and other heat transfer products for the automotive aftermarket. In
addition, the Company manufactures and distributes radiators, automotive air
conditioning compressors and replacement parts and other specialty heat
exchangers for OEMs of heavy trucks and industrial and off-highway equipment and
the heavy truck aftermarket. The Company also manufactures and installs
specialized interiors for utility trucks and vehicles for major commercial
fleets and designs, manufactures and assembles fabricated metal products for
telecommunications and other industrial customers. A description of the
particular products manufactured and the services performed by the Company in
each of its market segments is set forth below.
AFTERMARKET HEATING AND COOLING SYSTEMS.
GDI
Through GDI, the Company provides one of the most extensive product ranges of
high-quality radiators, radiator cores, heater cores and air conditioning
condensers to the automotive and heavy truck aftermarkets. The Company's primary
radiator and heater manufacturing facility in Nuevo Laredo, Mexico is ISO-9002
certified, which is an internationally recognized verification system for
quality management. In addition to its standard models, the Company can produce
and deliver special orders of such products typically within 24 hours.
The purpose of a radiator is to cool the engine. A radiator acts as a heat
exchanger, removing heat from engine coolant as it passes through the radiator.
The construction of a radiator usually consists of: the radiator core, which
consists of coolant-carrying tubes and a large cooling area; a receiving (inlet)
tank; a dispensing (outlet) tank; and side columns. In operation, coolant is
pumped from the engine to the inlet tank where it spreads over the tops of the
tubes. As the engine coolant passes through the tubes, it loses its heat to the
air stream through the fins connected to the tubes. After passing through the
tubes, the reduced temperature coolant enters the outlet tank and is then
re-circulated through the engine.
Complete Radiators. The Company's lines of complete radiators are produced
for automobile and light and heavy truck applications and consist of more than
700 models, which are able to service approximately 90% of the automobiles in
the United States. The Company has established itself as an industry leader with
its well-recognized line of Ready-Rad(R) radiators. The Ready-Rad(R) Plus line
with adaptable fittings has become popular because of its ability to fit the
requirements of a broad line of vehicles, enabling distributors to service a
larger number of vehicles with lower inventory levels.
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The Company introduced its Ready Rad(R) Heatbuster ("Heatbuster") line of
complete radiators in 1994. This line of replacement radiators is specially
designed to provide approximately 20% more cooling capability than a standard
radiator. The Heatbuster line is an ideal replacement radiator for vehicles,
which are used, for towing, hauling, plowing, or off-highway purposes, and as a
result, it has been particularly popular in the growing light truck market of
the automotive fleet.
Radiator Cores. A radiator core is the largest and most expensive component
of a complete radiator. The Company's Ready-Core(R) line consists of 2,500
models of radiator cores for automobiles and light trucks. Given the wide range
of cores required by today's automobile and truck fleet, there are many times
when a specific core is not readily available. In these cases, the Company can
produce a new core, on demand, within several hours. The Company is able to
provide same day service to virtually the entire United States using its 12,
strategically positioned, regional manufacturing plants.
Industrial cores are heavy-duty units, which are constructed of extremely
durable components in order to meet the demands of the commercial marketplace.
The Company produces approximately 13,000 models of industrial cores, and these
products serve many different needs in a variety of markets. In general, an
industrial core is much larger than an automotive core and typically sells for
three to four times the price of an automotive core.
Heater Cores. The Company produces more than 350 different heater core models
for domestic and foreign cars and trucks, which cover the requirements for more
than 95% of today's automotive fleet. A heater core is part of a vehicle's
heater system through which heated coolant from the engine cooling system flows.
The warm air generated as the liquid flows through the heater core is then
propelled into the vehicle's passenger compartment by a fan.
The Company's Ready-Aire(R) line of heater cores is recognized as an industry
leader and its models utilize both cellular and tubular technology. Traditional
heater cores utilize folded metal cellular construction to transport coolant
through the unit, while the more modern models transport coolant through tubes.
The Company introduced its tubular CT Ready-Aire(R) line of heater cores in
1988, and its CT heater cores now account for approximately 20% of the Company's
total heater core sales.
Radiator Parts and Supplies. The Company sells radiator shop supplies and
consumable products used by its customers in the process of radiator repairs.
The Company's extensive line includes radiator parts, small hand tools and
equipment, solders and fluxes. The Company is one of the largest domestic
suppliers of stamped metal radiator parts, supplying these parts to regional
core manufacturers throughout the United States.
Air Conditioning Condensers. Automotive air conditioning condensers were
added to the GDI product line in 1996 through the acquisition of Rahn
Industries, Inc., an aftermarket manufacturer and supplier of automotive air
conditioning condensers. Air conditioning condensers are a component of a
vehicle's air conditioning system designed to convert the air conditioner
refrigerant from a high-pressure gas to a high-pressure liquid by passing it
through the air-cooled condenser. GDI distributes this product under the
Ready-Aire(R) brand and has fully integrated this product into its distribution
network. GDI catalogs more than 1,000 condenser part numbers.
EVAP AND A/C PLUS
Through EVAP and A/C Plus, the Company provides one of the most extensive
catalogs of replacement automotive air conditioning parts and compressors to the
automotive and truck aftermarkets.
Compressors. Through its A/C Plus division, the Company re-manufactures
replacement air conditioning compressors for import applications in the
automotive and truck aftermarkets. The Company also sells air conditioning
compressors for replacement in both domestic and import automotive and truck
aftermarkets. The compressor is designed to compress low-pressure vapor
refrigerant, which it draws from the evaporator into a high-pressure gas.
This gas is then pumped to the condenser.
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Accumulators. Accumulators act as a reservoir that prevents liquid
refrigerant from reaching the compressor. The accumulator uses a drying agent to
remove moisture from the system and a filter screen to trap any solid
contaminants.
Evaporators. Automotive air conditioning evaporators are designed to remove
heat from the passenger compartment. The core is generally located under the
dash or adjacent to the fire wall and functions as a heat exchanger by passing
low pressure liquid refrigerant through its passageways and forcing warm air
from the passenger compartment over the core. The refrigerant becomes a
low-pressure vapor and is then re-compressed by the compressor and
re-circulated.
Air Conditioning Parts and Supplies. The Company sells an extensive line of
other air conditioning parts and supplies through EVAP. These other component
parts include driers, hose and tube assemblies, blowers and fan clutches.
SPECIALTY METAL FABRICATION
The Company's Specialty Metal Fabrication segment, through its Crown
Divisions, is currently comprised of two interrelated operations. The principal
products produced and services performed by each of these operations are set
forth below. Prior to December 1997, the Specialty Metal Fabrication segment
also performed truck cab conversions for Ford.
Vehicle Conversions. The Company is one of the leaders in the installation of
vehicle conversions in utility trucks and vans for major commercial fleets such
as AT&T, Broadband, ADT, Airborne Express, General Electric and the regional
telephone companies. The Company's vehicle conversion installation facilities
are strategically located near each of the major production facilities for
utility trucks and vans of Ford, Chrysler and GM. The Company offers its
customers a full range of customizing options ranging from the installation of
ladder racks, specialized bins and shelves and other components for convenient
and safe storage, to decaling the outside of the vehicle. Each interior is
installed according to the customer's specifications, based upon various design
and equipment options offered by the Company. Much of the specialized equipment
installed by the Company in its conversion business is also manufactured by the
Company. During 1997 the Company, under a short-term contract with Ford, up-fit
approximately 10,000 Aerostar and Windstar mini vans for the US Postal Service.
The modifications were completed at the Company's Lorain, Ohio and St. Charles,
Missouri facilities. In December 1997, the Company acquired substantially all of
the assets of a small Canadian van up-fitter to provide a strategic location in
proximity to Ford's Missassauga, Ontario, Canada plant and greater access to the
Canadian market.
The Company enjoys a reputation in the industry for offering new and
innovative high quality products and on-time delivery. For example, the Company
introduced in the early 1990's its exclusive Slide-Down(TM) ladder rack, which
enables service technicians to easily load and unload heavy ladders from the top
of a vehicle with the reduced risk of back injury and strain. In 1997, the
Company introduced a new, easily removable storage system for mini-vans called
Slide-Lock(TM), which offers users the ability to switch back and forth between
a passenger van and a service van within minutes. In 1999, the Company
introduced the vehicle conversion system (patent pending) for law enforcement
vehicles. The Company is continually seeking to capitalize on its reputation by
marketing these innovations to the automotive companies as value-added factory
programs and options.
Fabricated Metal Products. Certain of the fabricated metal products
manufactured by the Company are used in its own vehicle conversion business. In
addition to vehicle conversion products, the Company also produces fabricated
metal components for telephone switching equipment, wireless communications
equipment, stationary rotary air compressors and heavy-duty battery boxes. The
Company designs, manufactures and assembles over 400 different fabricated metal
parts, including vehicle conversion parts and high tolerance cabinets for
telecommunications and other industrial customers such as, Lucent Technologies,
Alcatel and East Penn. During 1998, the Company opened a state-of-the-art metal
fabrication facility in Plano, Texas to service the rapidly growing
telecommunications industry in that area. The Plano, Texas facility is ISO-9002
certified. The Company's metal fabrication business is principally
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conducted out of its Wooster, Ohio, Thomaston, Georgia and Plano, Texas
manufacturing facilities. The Company focuses on the production of large,
complex parts that typically require greater engineering and more sophisticated
production techniques than traditional high volume, undifferentiated products.
The Company's Wooster, Ohio facility is currently ISO-9001 and QS-9000
certified.
Truck Cab Conversions. Prior to December 1997, the Company produced a
four-door pickup truck cab for Ford's F-Series Truck (the "Crew Cab") and
modified rear wheel fender assemblies to accommodate a dual rear wheel axle
("DRWs"). The Crew Cab was produced by the Company utilizing an assembly line
production process in which various stamped components were assembled using
certain welding techniques. In much the same fashion, the Company produced DRWs
in order to provide adequate space for the additional tire on each side of the
rear wheel axle assembly. Prior to December 1997, the Company was the exclusive
supplier of Crew Cabs and DRWs to Ford, and had provided such products to Ford
for 30 years and 20 years, respectively, excluding a brief period from 1980 to
1982 when Ford did not offer either option with its F-Series Pickup Trucks. Ford
moved the manufacture of Crew Cabs and DRWs in-house in late 1997. The Company's
Crew Cab and DRW production facility in Louisville, Kentucky was closed in
December 1997.
OEM HEAT TRANSFER SYSTEMS
Through its G&O Division, the Company designs, manufactures and markets
radiators and charge air coolers to OEMs of heavy duty trucks, buses, as well
as, industrial and off-highway equipment such as generator sets, construction
vehicles, railroad locomotives and military equipment. The Company's Jackson,
Mississippi production facility is ISO 9002 certified and expects to attain
QS-9000 quality certification in 2000.
Radiators. The Company custom designs, manufactures and sells approximately
400 different models of radiators, which are specifically designed and
engineered to meet customer specifications. The Company's radiators are
specifically engineered to withstand a variety of demanding customer
applications. The Company's radiators are sold under the widely-recognized
Ultra-Fused(R) brand name utilizing welded tube-to-header core construction and
are specifically engineered to meet customer specifications to withstand a
variety of demanding customer applications.
Charge Air Coolers. The Company offers its OEM customers approximately 200
different models of aluminum charge air coolers. A charge air cooler is a device
that is used to decrease the temperature of the turbo that is used by the engine
in its combustion process, which in turn improves the operating efficiency of
the engine and lowers its emission levels. The Company believes that the demand
for charge air coolers will continue to increase as the Company's customers face
increasing pressure to produce vehicles and equipment that are more fuel
efficient and less polluting. In 1999, the Company obtained a U.S. Patent
relating to its proprietary Ultra-Seal grommetted charge air cooler. This
product offers significant improvements in performance and reliability and
exceeds current industry guidelines for durability.
G&O's traditional heavy-duty on-highway (class 8) truck market has become
increasingly competitive and its share of this market has been reduced. The
Company believes there are opportunities to expand into the specialty vehicle
marketplace, which is not as well served as the traditional class 8 truck
market.
FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS, EXPORT SALES AND DOMESTIC AND
FOREIGN OPERATIONS
The Company operates under three business segments, Aftermarket Heating and
Cooling Systems, OEM Heat Transfer Systems and Specialty Metal Fabrication.
Applicable segment information appears in Note 3 of the Notes to Consolidated
Financial Statements contained in the Registrant's 1999 Annual Report to
Stockholders, certain portions of which are included in Item 8 of this Report.
All such information is incorporated herein by reference. Export sales from
North America were below 10% in each of the years reported. The Company has a
manufacturing facility in Mexico and acquired a vehicle conversion facility in
Canada in December 1997. During 1999 and 1998, the Company
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had $5.1 million and $4.8 million in sales in Mexico, respectively. Sales in
Canada aggregated $4.3 million and $1.4 million in 1999 and 1998, respectively.
CUSTOMERS
The Company sells its products and services to a wide variety and large
number of industrial and other commercial customers. The Company sells its
Aftermarket replacement radiators, air conditioning replacement parts and
supplies, and other heat transfer products to national retailers of aftermarket
automotive products, such as AutoZone, Pep Boys, warehouse distributors,
radiator shops, parts jobbers and, to a lesser extent, OEMs. The Company
supplies OEM heat transfer systems, including radiators, charge air coolers and
cooling modules, to OEMs of heavy duty trucks, such as PACCAR and Mack, and OEMs
of industrial and off-highway equipment, such as Cummins Power Generation, AM
General and Oshkosh Truck Corporation. Principal customers of the Company's
vehicle conversion products and services include operators of large commercial
fleets such as Sears, General Electric and Airborne Express. The Company sells
its fabricated metal components to telecommunications companies, such as Lucent
Technologies and Alcatel.
The Company's largest customer during 1999 and 1998 was AutoZone, in our
Aftermarket Heating and Cooling Systems segment. AutoZone accounted for
approximately 12% and 11% of net sales for 1999 and 1998, respectively. The
Company's largest customer during 1997 was Ford, in our Specialty Metal
Fabrication segment, which accounted for approximately 27% of the Company's 1997
net sales. The 1997 sales to Ford include Crew Cab and Dual Rear Wheel ("DRW")
components and up-fitted vans destined for the US Postal Service. In 1999, 1998
and 1997, the Company had no other customers who individually accounted for
greater than 10% of the Company's net sales.
SALES AND MARKETING
The Company maintains a separate sales and marketing department at each of
its principal operating units. By focusing its sales effort at the operating
unit level, the Company enables its sales staff to develop a thorough
understanding of such unit's technical and production capabilities and of the
overall market in which such unit operates. The Company has approximately 280
individuals involved in sales and marketing efforts.
GDI's sales and marketing efforts are under the direction of GDI's Executive
Vice President who oversees the Vice President of Marketing, the Vice President
of National Account Sales and the National Sales Manager. The National Sales
Manager is responsible for sales to radiator shops and traditional wholesale
distributors through the Company's branches and agencies. GDI also employs
several marketing specialists who report to the Vice President of Marketing and
develop, implement and monitor GDI's various marketing and advertising programs.
As part of its current marketing efforts, GDI is focusing on increasing its
sales to the fastest growing segments of the automotive aftermarket. The Vice
President of National Account Sales is responsible for sales to retailers and
auto parts warehouses. GDI also uses independent sales representatives to aid in
its outside sales efforts in these channels.
EVAP has an internal sales and marketing staff consisting of a Vice President
of Sales and Marketing with staff that serves its existing customer base and
seeks new customers. EVAP also utilizes independent sales representatives to aid
in its outside sales efforts.
At G&O, the Company has an in-house sales management staff that is
responsible for growing the business, servicing existing customers and
identifying new marketing opportunities. These individuals and in-house
engineering specialists, work in close consultation with the engineering staff
of G&O's customers in order to provide the technical expertise and advice needed
in the development stage of new customer products. In addition, G&O's engineers
work closely with truck engine OEMs, such as Cummins Engine and Detroit Diesel,
during the early stages of new product development and design. G&O has
historically focused on sales of its products to domestic OEMs of heavy-duty
trucks and industrial equipment. In recent years, G&O has expanded its focus to
include all highway and specialty vehicle applications.
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In the vehicle conversion portion of its business, the Company's Crown
Divisions employ direct salespersons dedicated to servicing the national fleet
and leasing companies, as well as, truck and van OEMs such as Ford, GM and
Chrysler as well as independent sales representatives who manage the sales
effort to the over 200 vehicle dealer/distributors nationwide. In 1997, the
Company expanded direct fleet coverage to develop its West Coast opportunities
and support distribution warehousing in Los Angeles, California and Dallas,
Texas. In addition, the Company employs several direct salespersons and utilizes
an independent sales representative force to service the telecommunications
industry and other industrial buyers of fabricated metal products and value
added assemblies.
COMPETITION
The Company faces significant competition within each of the markets in which
it operates. In its Aftermarket Heating and Cooling Systems product lines, the
Company believes that it is among the major manufacturers and that competition
is widely distributed. The Company competes with the national producers of heat
transfer products, such as Modine Manufacturing ("Modine"), the internal
operations of OEMs and, to a lesser extent, local and regional manufacturers.
The Company's primary competition in the air conditioning replacement parts
business includes the Four Seasons, a division of Standard Motor Products, as
well as numerous regional operators. The Company believes it can utilize its
established distribution system to expand its air conditioning parts business
nationally. The Company's principal methods of competition include product
design, performance, price, service, warranty, product availability and timely
delivery.
With respect to its OEM Heat Transfer Systems segment, the Company competes
with national producers of heat transfer products, such as Modine, Valeo Engine
Cooling Systems and Behr GmbH & Co. The Company principally competes for new
business both at the beginning of the development phase or offering of a new
model and upon the redesign of existing models used by its major customers. New
model development generally begins two to three years prior to the marketing of
the vehicle to the public. Once a producer has been designated to supply
components to a new program, an OEM will generally continue to purchase those
components from the designated producer for the life of the program.
Competition in the vehicle conversion business is widely distributed and the
Company competes with numerous regional operators. In the fabricated enclosure
market, the Company competes with numerous regional fabricators and competition
is widely distributed. The Company's principal methods of competition in this
market include product design, quality and timely delivery. Leadership in the
vehicle conversion business largely relies on close proximity to factory
assembly plants, maintenance of quality standards to retain authorized factory
ship through capability, and an ability to adapt capacity to meet seasonal
demands and satisfy customer delivery requirements.
INTELLECTUAL PROPERTY
The Company owns a number of foreign and US patents and trademarks. The
patents expire on various dates from 2009 to 2019. In general, the Company's
patents cover certain of its radiator, charge air cooler and air conditioning
accumulator manufacturing processes. The Company has entered into licensing and
other agreements with respect to certain patents, trademarks and manufacturing
processes it uses in the operation of its business. The Company believes that it
owns or has rights to all patents and other technology necessary for the
operation of its business. The Company does not consider any single patent or
trademark or group of patents or trademarks to be material to its business as a
whole.
RAW MATERIALS AND SUPPLIERS
The principal raw materials used by the Company in its Aftermarket Heating
and Cooling Systems and OEM Heat Transfer Systems product lines are copper and
brass. The principal raw material used in the Company's specialty metal
fabrication business is steel. Although copper, brass and steel and other
materials are available from a number of
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vendors, the Company has chosen to concentrate its sources with a limited number
of long-term suppliers. The Company believes this strategy results in purchasing
and operating economies. Outokumpu, a Swedish corporation, supplied the Company
with approximately 90% of its copper and brass requirements in 1999, 1998, and
1997. The Company believes its sources for raw steel materials are very reliable
and adequate for its needs. The Company has not experienced any significant
supply problems in its operations and does not anticipate any significant supply
problems in the foreseeable future.
The Company typically executes purchase orders for its anticipated copper and
brass requirements approximately three to six months prior to the actual
delivery date. The purchase price for such copper and brass is established at
the time orders are placed by the Company and not at the time of delivery.
Copper prices had been trending upward through mid-year 1997 at which time a
steady decline began which continued through the end of 1998. Prices began to
rise during the middle of 1999 and recently began to level off. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" - Item 7.
BACKLOG
The Company's backlog was approximately $10.3 million at December 31, 1999
compared with approximately $13.1 million at December 31, 1998. Backlog consists
of product orders for which a customer purchase order has been received and is
scheduled for shipment within 12 months. Since orders may be rescheduled or
canceled, backlog does not necessarily reflect future sales levels.
SEASONALITY
The Company expects the second and third quarters to be positively impacted,
and the first and fourth quarters to be negatively impacted, by the operating
results of the Aftermarket Heating and Cooling Systems segment, which typically
experiences higher sales during the summer months as the demand for replacement
radiators and air conditioning parts and supplies tend to increase and lower
sales during the winter months. Historically, the OEM Heat Transfer Systems and
Specialty Metal Fabrication segments have experienced a slight decrease in
revenues and operating income during the third and fourth quarters compared with
the first and second quarters, as third quarter results are affected by
scheduled plant shut-downs for vacations and model year changeovers, while
fourth quarter results are affected by scheduled plant shut-downs for the
holiday season. GDI's seasonal impact became more pronounced on TransPro as a
whole since 1998 with the end of the far less seasonal Crew Cab and DRW program
in December 1997. The Company will continue to seek opportunities to mitigate
the seasonality factor through its other segment operations.
RESEARCH AND DEVELOPMENT
Research and development expenses were approximately $0.2 million for each of
the years ended December 31, 1999, 1998 and 1997.
EMPLOYEES
At December 31, 1999, the Company had approximately 2,562 employees. Of these
employees, approximately 1,160 were covered by collective bargaining agreements.
The Company's collective bargaining agreements are independently negotiated at
each manufacturing facility and expire on a staggered basis. Locals affiliated
with the International Union of Electronic, Electrical, Technical, Salaried and
Machine Workers (AFL-CIO) and the United Paperworkers International Union
represent approximately 26% each, of the Company's unionized employees. In
addition, a local Mexican labor union represents approximately 44% of the
Company's unionized employees. The Company has successfully re-negotiated three
collective bargaining agreements over the last several years and feels labor
relations are good, although there can be no assurance that the Company will not
experience work stoppages in the future.
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ITEM 2. PROPERTIES
The Company maintains its corporate headquarters in New Haven, Connecticut
and conducts its operations through 16 principal manufacturing and assembly
facilities. The Company believes its property and equipment are in good
condition and suitable for its needs. The Company estimates that its plants
operate at between 40% and 95% of capacity on a six-day basis. The Company has
sufficient capacity to increase production with respect to its replacement
radiator and original equipment product lines, its air conditioning replacement
parts business, and its vehicle conversion and fabricated metal products
operations. The Company's principal manufacturing and assembly facilities are as
follows:
APPROXIMATE OWNED/
LOCATION SQUARE FOOTAGE LEASED PRODUCT LINE
- ------------------------------------ -------------- --------- -----------------------------------------------
New Haven, Connecticut 158,800 Owned(1) Corporate headquarters, GDI headquarters,
tubes for original equipment radiators.
Jackson, Mississippi 135,885 Owned Original equipment radiators.
Wooster, Ohio 216,000 Owned (1) Fabricated metal products, vehicle
conversion.
Lorain, Ohio 79,846 Owned Vehicle conversion.
Thomaston, Georgia 30,000 Owned Fabricated metal products.
Baltimore, Maryland 10,000 Leased Vehicle conversion.
Bridgeton (St. Louis), Missouri 16,900 Leased Vehicle conversion.
Plano, Texas 71,500 Leased Fabricated metal products.
Dallas, Texas 50,050 Leased Replacement radiators (radiator cores).
Nuevo Laredo, Mexico 109,055 Leased Replacement radiators (radiator cores).
Maquoketa, Iowa 38,000 Leased Parts and tooling for replacement radiators.
Los Angeles, California 32,900 Leased Air conditioning condensers.
Mississauga, Ontario Canada 14,616 Leased Vehicle conversion.
Arlington, Texas 82,350 Leased Air conditioning parts & supplies.
Arlington, Texas 18,000 Leased Air conditioning compressor re-manufacturing.
Warren, Michigan 21,500 Leased Vehicle conversion.
- -------------------------
(1) Subject to IRB financing arrangements.
In its Aftermarket Heating and Cooling Systems segment, the Company maintains
a nationwide network of manufacturing and distribution facilities which enables
the Company to provide its customers, generally, with same day delivery service.
In addition to the three manufacturing facilities for replacement radiators
described above, the Company also operates 12 fully equipped, regional
manufacturing facilities. These 12 facilities are all leased, average
approximately 11,000 square feet in size and are strategically located to
generally provide same-day service to virtually the entire United States. The
Company also has 47 local branch offices and 18 independent agencies and one
distribution center in Memphis, Tennessee that comprise its nationwide local
distribution network. All of the Company's local branch distribution facilities
are leased and are approximately 6,000 square feet in size.
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ENVIRONMENTAL MATTERS
As is the case with manufacturers of similar products, the Company uses
certain hazardous substances in its operations, including certain solvents,
lubricants, acids, paints and lead, and is subject to a variety of environmental
laws and regulations governing discharges to air and water, the handling,
storage and disposal of hazardous or solid waste materials and the remediation
of contamination associated with releases of hazardous substances. These laws
include the Resource Conservation and Recovery Act (as amended), the Clean Air
Act (as amended), the Clean Water Act of 1990 (as amended) and the Comprehensive
Environmental Response, Compensation and Liability Act (as amended). The Company
believes that, as a general matter, its policies, practices and procedures are
properly designed to reasonably prevent risk of environmental damage and
financial liability to the Company. During 1998, the Company was fined
approximately $0.1 million in connection with certain pre-treatment water
containment violations at its Jackson, Mississippi facility. The issues were
satisfactorily resolved. The Company believes it is reasonably possible that
environmental related liabilities might exist with respect to an industrial site
formerly occupied by the Company. Based upon environmental site assessments, the
Company believes that the cost of any potential remediation for which the
Company may ultimately be responsible will not have a material adverse effect on
the consolidated financial position, results of operation or liquidity of the
Company. The Company has an environmental policy that confirms its commitment to
compliance with existing environmental regulations and planning to reduce the
level of pollutants in the manufacturing process.
The Company currently does not anticipate any material adverse effect on its
consolidated results of operations, financial condition or competitive position
as a result of compliance with federal, state, local or foreign environmental
laws or regulations. However, risk of environmental liability and charges
associated with maintaining compliance with environmental laws is inherent in
the nature of the Company's business and there is no assurance that material
environmental liabilities and compliance charges will not arise. The Company has
assumed all environmental liabilities, if any, associated with the former Allen
Automotive and Truck Products Business and GDI.
ITEM 3. LEGAL PROCEEDINGS
Various legal actions are pending against or involve the Company with respect
to such matters as product liability, casualty and employment-related claims. In
the opinion of management, after review and consultation with counsel, the
aggregate liability, if any, that ultimately may be incurred in excess of
amounts already provided should not have a material adverse effect on the
consolidated financial position, results of operations, or liquidity of the
Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fourth
quarter of the year ended December 31, 1999.
EXECUTIVE OFFICERS OF THE REGISTRANT*
SERVED AS
OFFICER POSITION OR OFFICE WITH THE COMPANY & BUSINESS
NAME AGE SINCE EXPERIENCE DURING PAST FIVE (5) YEAR PERIOD
---- --- ----- -------------------------------------------
Henry P. McHale 61 July 1995 President, Chief Executive Officer and Director, since 1995; President
and Chief Executive Officer of GDI, 1992 through 1995. Prior thereto,
various executive positions with Ladish Corporation and Rockwell
Automotive.
Jeffrey L. Jackson 52 August 1995 Vice President Human Resources, since 1995; Vice President of Human
Resources of GDI, 1992 through 1995. Prior thereto, Managing Director
of Resources of IMCOR since 1990.
Timothy E. Coyne 45 October 1996 Vice President Finance, Treasurer, Secretary, Chief Financial Officer
since 1998 and Corporate Controller, since 1996; Vice President of
Finance and Administration and Treasurer of Keene Corporation 1990
through 1996.
Michael T. Hooper 54 February 1998 President of The Crown Divisions since 1996; Senior Vice President of
Findlex Corporation from 1993-1996; prior thereto various executive
positions with Rockwell International and CMW, Inc.
John F. Della Ventura 51 February 1998 President of G&O, since 1998; Group Controller-Engine Systems of
Echlin, Inc. (which was acquired by Dana Corporation) 1990 through
1998. Prior thereto Vice President Finance, G&O Manufacturing.
* All officers are elected by the Board of Directors.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock is traded on the New York Stock Exchange. The
number of stockholders of record of the Company's Common Stock as of the close
of business on March 1, 2000, was 1,207. Information regarding market prices and
dividends declared for the Company's Common Stock is shown below for 1999 and
1998. Market prices are closing prices quoted on the New York Stock Exchange,
the principal exchange market for the Company's Common Stock. The Company
currently expects that comparable dividends will continue to be paid in the
future, although there can be no assurance of this.
YEAR ENDED DECEMBER 31, 1999
----------------------------------------------------
1ST QTR 2ND QTR 3RD QTR 4TH QTR
------- ------- ------- -------
Market price of common stock
---High $ 6-1/4 $ 6-3/8 $ 7-15/16 $ 6-7/8
---Low 4-5/16 4-3/8 4-15/16 5
Dividends per share $ .05 $ .05 $ .05 $ .05
YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------
1ST QTR 2ND QTR 3RD QTR 4TH QTR
------- ------- ------- -------
Market price of common stock
---High $ 8-15/16 $ 8-3/4 $ 7-7/16 $ 6-1/4
---Low 7 7-7/16 5-5/16 4-3/8
Dividends per share $ .05 $ .05 $ .05 $ .05
ITEM 6. SELECTED FINANCIAL DATA
The information required by this Item is incorporated herein by reference to
"Financial Highlights" contained in the Registrant's 1999 Annual Report to
Stockholders, portions of which are filed as Exhibit 13 to this Report.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The information required by this Item is incorporated herein by reference to
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" contained in the Registrant's 1999 Annual Report to Stockholders,
portions of which are filed as Exhibit 13 to this Report.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has certain exposures to market risk related to changes in
interest rates, foreign currency exchange rates and commodities.
The Company's interest rate risk is most sensitive to changes in the U.S.
interest rates. The Company has an outstanding revolving credit agreement, under
which approximately $49.7 million was outstanding at December 31, 1999. The
revolving credit agreement bears interest at variable rates based on current
indices. The weighted average interest rate on this agreement during 1999 was
6.55%. Interest on the revolving credit agreement is based on, at the Company's
option, changes in either the Eurodollar loan rate or the Federal Funds
effective rate, plus an applicable margin based on certain Company ratios. The
Company also has Industrial Revenue Bonds ("IRB's"), which
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aggregated $13.0 million at December 31, 1999, and mature in 2010 and 2013. The
IRB's had a weighted average interest rate of 3.58% during 1999. Interest on the
IRB's is based on the short-term tax exempt bonds index.
The Company has sales and manufacturing facilities in Mexico and Canada. As a
result, changes in the foreign currency exchange rates and changes in the
economic conditions in these foreign markets could affect financial results. The
Company has accounted for transactions associated with these foreign operations
in accordance with the guidance established under Financial Accounting Standards
No. 52, "Foreign Currency Translation." Generally, assets and liabilities are
translated into U.S. dollars at the current rate of exchange, while revenues and
expenses are translated at the average rate for the year. Property, plant and
equipment and its associated depreciation and stockholders' equity are
translated at the historical rate. Operating income or loss for the Mexico
operation is included in the periodic results of operations of the Company. The
foreign currency exchange amounts associated with Canada are included in other
comprehensive income through the statement of changes in stockholders' equity.
The Company believes it has mitigated the risk associated with its foreign
operations through its management of inventory and other significant operating
assets.
Certain risks may arise in the various commodity markets in which the Company
participates. Commodity prices in the copper, brass and steel markets may be
subject to changes based on availability. The Company conducts its purchasing of
such commodities generally through three to six month purchase order
commitments. See "Raw Materials and Suppliers" in Part I of this Report for
additional information on commodity pricing.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item is incorporated herein by reference to
the Consolidated Statements of Income, Consolidated Statements of Comprehensive
Income, Consolidated Balance Sheets, Consolidated Statements of Cash Flows and
Consolidated Statements of Changes in Stockholders' Equity, the Notes to
Consolidated Financial Statements and the "Report of Independent Accountants"
contained in the Registrant's 1999 Annual Report to Stockholders, portions of
which are filed as Exhibit 13 to this Report.
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
There have been no disagreements between Registrant and its independent
accountants on accounting and financial disclosure during the year ended
December 31, 1999.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Portions of the information required by this item are included in Part I
hereof, on page 13 of this Report. Other information required by this item is
contained in the Company's 2000 Proxy Statement under the heading, "Proposal No.
1 - Election of Directors" and is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information contained in the Company's 2000 Proxy Statement under the
heading "EXECUTIVE COMPENSATION" is incorporated herein by reference.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information contained in the Company's 2000 Proxy Statement under the
headings "STOCK OWNERSHIP-Principal Stockholders and Directors and Officers" is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information contained in the Company's 2000 Proxy Statement, under the
heading "CERTAIN TRANSACTIONS" is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a)(1)Financial Statements of the Registrant
The Consolidated Financial Statements of the Registrant listed below,
together with the Report of Independent Accountants, dated February 14, 2000,
are incorporated herein by reference to the Registrant's 1999 Annual Report to
Stockholders, portions of which are filed as Exhibit 13 to this Report.
Consolidated Statements of Income for the Years Ended December 31,
1999, 1998 and 1997
Consolidated Statements of Comprehensive Income for the Years Ended
December 31, 1999, 1998 and 1997
Consolidated Balance Sheets at December 31, 1999 and 1998
Consolidated Statements of Cash Flows for the Years Ended December 31,
1999, 1998 and 1997
Consolidated Statements of Changes in Stockholders' Equity for the Years
Ended December 31, 1999, 1998 and 1997
Notes to Consolidated Financial Statements
Report of Independent Accountants
(a)(2)Financial Statement Schedules
The following additional information should be read in conjunction with the
Consolidated Financial Statements of the Registrant included in Item 8 of this
Report:
Schedule II - Valuation and Qualifying Accounts, on page 23 of this Report
Schedules other than the schedule listed above are omitted because they are
not applicable, or because the information is furnished elsewhere in the
Consolidated Financial Statements or the Notes thereto.
(a)(3) Exhibits
The information required by this Item relating to Exhibits to this Report is
included in the Exhibit Index in (c) below.
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(b) Reports on Form 8-K
On October 22, 1999, the Company filed a Current Report on Form 8-K
announcing its intention to evaluate strategic alternatives for its OEM Heat
Transfer Systems and Specialty Metal Fabrication segments.
(c) Exhibits -The following exhibits are filed as part of this report:
2.1 Agreement, dated June 15, 1995, between Allen Heat Transfer
Products, Inc., AHTP II, Inc., GO/DAN Industries and Handy &
Harman Radiator Corporation. (1)
3.1 (i) Restated Certificate of Incorporation of TransPro, Inc. (3)
3.1 (ii) By-laws of TransPro, Inc. (1)
4.1 Form of Rights Agreement between the Company and the First
National Bank of Boston, as Rights Agent (including form of
Certificate of Designations of Series A Junior Participating
Preferred Stock and form of Rights Certificate). (1)
4.2 Form of Revolving Credit Agreement between the Company and
Certain lending Institutions or Banks, BankBoston, N.A., as
Agent. (1)
The Company is a party to certain other long-term debt agreements
each of which does not exceed 10 percent of the total assets of
the Company and its subsidiaries on a consolidated basis. The
Company agrees to file such agreements upon request from the
Securities and Exchange Commission.
4.3 First Amendment to Revolving Credit Agreement between the
Company and Certain lending Institutions or Banks, BankBoston
N.A. as Agent. (4)
4.4 Waiver and Second Amendment to Revolving Credit Agreement
between the Company and Certain lending Institutions or Banks,
BankBoston, N.A., as Agent. (4)
4.5 Third Amendment to Revolving Credit Agreement between the
Company and Certain lending Institutions or Banks, BankBoston
N.A. as Agent, filed herewith.
10.1 TransPro, Inc. 1995 Stock Plan. (1)
10.2 Form of Stock Option Agreement under the 1995 Stock Option Plan
(1)
10.3 Form of TransPro, Inc. 1995 Non-employee Directors Stock Option
Plan. (1)
10.4 Form of Stock Option Agreement under the 1995 Non-employee
Directors Stock Option Plan. (1)
10.5 Form of Contribution Agreement between Allen and the Company.
(1)
10.6 Form of Instrument of Assumption of the Company. (1)
10.7 Form of Indemnification Agreement. (1)
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10.8 Form of Employment Agreement between the Company and Henry P.
McHale. (1)
10.9 Amendment No. 1 to Employment Agreement between the Company and
Henry P. McHale. (1)
10.10 Form of Employment Agreement between the Company and John C.
Martin, III. (1)
10.11 Form of Key Employee Severance Policy. (1)
10.12 Letter Agreement, dated December 15, 1992 between Jeffrey J.
Jackson and GO/DAN Industries. (1)
10.13 Letter Agreement dated September 24, 1996 between Timothy E.
Coyne and TransPro, Inc. (2)
10.14 Settlement and Release Agreement dated February 3, 1999 between
the Company and John C. Martin, III, filed herewith.
13 Portions of the 1999 Annual Report to Stockholders incorporated
by reference herein.
21.1 Subsidiaries of the Company, filed herewith.
22 Report of Independent Accountants on Financial Statement
Schedule, filed herewith.
23 Consent of PricewaterhouseCoopers LLP, filed herewith.
24 Powers of Attorney (included on signature page), filed herewith.
27 (i-viii) Financial Data Schedule, filed herewith.
----------------------
(1) Incorporated by reference to the Company's Registration Statement on Form
S-1 (File No. 33-96770).
(2) Incorporated by reference to the Company's 1996 Form 10-K (File No.
1-13894).
(3) Incorporated by reference to the Company's Form 10-Q for the quarter ended
September 30, 1998(File No. 1-13894).
(4) Incorporated by reference to the Company's Form 10-Q/A for the quarter
ended March 31, 1999(File No. 1-13894).
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SIGNATURES
PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.
TransPro, Inc.
By /s/ HENRY P. MCHALE
----------------------------------------------
Henry P. McHale
President, Chief Executive Officer and Director
Date: March 15, 2000
POWER OF ATTORNEY
Each of the undersigned hereby appoints Barry R. Banducci and Henry P.
McHale, and each of them severally, his or her true and lawful attorneys to
execute on behalf of the undersigned any and all amendments to this annual
report on Form 10-K and to file the same, with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange
Commission. Each such attorney will have the power to act hereunder with or
without the others. Each of the undersigned hereby ratifies and confirms all
such attorneys, or any of them may lawfully do or cause to be done by virtue
thereof.
---------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
/s/ HENRY P. MCHALE March 15, 2000
- ------------------------------------
Henry P. McHale, President, Chief
Executive Officer and Director
/s/ WILLIAM J. ABRAHAM, JR. March 15, 2000
- ------------------------------------
William J. Abraham, Jr., Director
/s/ BARRY R. BANDUCCI March 15, 2000
- ------------------------------------
Barry R. Banducci, Director
/s/ PHILIP WM. COLBURN March 15, 2000
- ------------------------------------
Philip Wm. Colburn, Director
/s/ PAUL R. LEDERER March 15, 2000
- ------------------------------------
Paul R. Lederer, Director
/s/ SHARON M. OSTER March 15, 2000
- ------------------------------------
Sharon M. Oster, Director
/s/ F. ALAN SMITH March 15, 2000
- ------------------------------------
F. Alan Smith, Director
/s/ TIMOTHY E. COYNE March 15, 2000
- ------------------------------------
Timothy E. Coyne
Vice President Finance, Treasurer,
Secretary, Corporate Controller
and Chief Financial Officer
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SCHEDULE II
TRANSPRO, INC.
VALUATION AND QUALIFYING ACCOUNTS
PERIOD BALANCE AT CHARGED TO CHARGED TO DEDUCTIONS BALANCE AT
BEGINNING OF COSTS AND OTHER END OF
(DOLLARS IN THOUSANDS) PERIOD EXPENSES ACCOUNTS (1) PERIOD
Year Ended December 31, 1999
Allowance for doubtful accounts $ 2,390 $ 268 $ (238) $ (292) $ 2,128
Allowance for obsolete inventory 5,605 875 (232) (1,525) 4,723
Allowance for tax loss valuation - - 189 - 189
Year Ended December 31, 1998
Allowance for doubtful accounts 3,441 1,394 250 (2,695) 2,390
Allowance for obsolete inventory 5,003 1,629 800 (1,827) 5,605
Year Ended December 31, 1997
Allowance for doubtful accounts 3,378 1,790 - (1,727) 3,441
Allowance for obsolete inventory 4,942 1,299 - (1,238) 5,003
(1) Amounts adjusted in doubtful accounts and inventory were related to
acquisition reserves and charged to goodwill. Amounts for tax valuation
allowance were charged to deferred taxes.
22