SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant / /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2
KSW, Inc.
(Name of Registrant as Specified in Its Charter)
JAMES OLIVIERO, ASSISTANT SECRETARY
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box);
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
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:
NOTES:
<PAGE>
KSW, INC.
37-16 23RD STREET
LONG ISLAND CITY, NEW YORK 11101
----------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 5, 1997
-----------------------
Dear Fellow Stockholder:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of KSW,
Inc., a Delaware corporation (the "Company"), will be held on May 5, 1997 at
2:00 p.m., at the Crowne Plaza Hotel at LaGuardia Airport, Flushing, New York,
for the following purposes:
1. To elect one Class II director, to serve for a term of three years
until his successor shall have been duly elected and qualified ("Proposal 1");
2. To ratify the appointment of Marden Harrison & Kreuter as
independent auditors of the Company for the year 1997 ("Proposal 2"); and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof ("Proposal 3").
Stockholders of record at the close of business on March 14, 1997 will
be entitled to vote at the meeting.
All Stockholders are cordially invited to attend the meeting in
person. However, to assure your representation at the meeting, you are urged to
SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE PROVIDED, in order
that as many shares as possible may be represented at the meeting. Any
stockholder attending the meeting may vote in person even if he or she has
returned a proxy card.
Sincerely,
James Oliviero
Assistant Secretary
Long Island City, New York
Dated: April 1, 1997
<PAGE>
KSW, INC.
37-16 23RD STREET
LONG ISLAND CITY, NEW YORK 11101
(718) 361-6500
-----------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
MAY 5, 1997
-----------------------
GENERAL INFORMATION
SOLICITATION OF PROXIES. The accompanying proxy is solicited by and on behalf of
the Board of Directors of KSW, Inc., a Delaware corporation (the "Company"), for
use at the Annual Meeting of Stockholders (the "Meeting") to be held at the
Crowne Plaza Hotel at LaGuardia Airport, Flushing, New York, on May 5, 1997, at
2:00 p.m., New York time, and at any and all adjournments thereof.
The costs of solicitation will be borne by the Company. This proxy statement and
the accompanying proxy are being sent to the stockholders of the Company on or
about April 5, 1997. The annual report of the Company for the year 1996 (which
includes the Management's Discussion and Analysis of Financial Condition and
Results of Operations from the Company's Annual Report on Form 10-K) is enclosed
herewith.
VOTING RIGHTS. Pursuant to the By-Laws, the Board of Directors has fixed the
time and date for the determination of stockholders entitled to notice of and to
vote at the meeting as of the close of business on March 14, 1997. Accordingly,
only stockholders of record on such date and at such time will be entitled to
vote at the meeting, notwithstanding any transfer of any stock on the books of
the Company thereafter.
At the close of business on March 14, 1997, the Company had outstanding
5,542,978 shares of Common Stock, $.01 par value per share (the "KSWI Common
Stock"), each of which entitled the holder to one vote. There were no issued
shares held by the Company in its treasury. The affirmative plurality of the
shares represented in person or by proxy at the meeting is required for the
election of directors. For all other matters, the affirmative vote of the
holders of a majority of the stock present in person or represented by proxy at
the meeting and entitled to vote on the subject matter and which has actually
been voted is required for approval. Proxies marked as abstaining (including
proxies containing broker non-votes) on any matter to be acted upon by
stockholders will be treated as present at the meeting for purposes of
determining a quorum but will not be counted as votes cast on such matters.
A proxy may be revoked by the stockholder at any time prior to its being voted.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivery to the Secretary of the Company
of a written notice of revocation or a duly executed proxy bearing a later date
or by attending the meeting and voting in person.
If a proxy is properly signed and is not revoked by the stockholder, the shares
it represents will be voted at the meeting in accordance with the instructions
of the stockholder. If the proxy is signed and returned without specifying
choices, the shares will be voted in favor of the election as directors of the
nominees listed on the following pages and in favor of Proposal 2. Votes are
tabulated at the annual meeting by inspectors of election.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS. Proposals of stockholders of the
Company that are intended to be presented by such stockholders at the Company's
1998 Annual Meeting of Stockholders must be received by the Company no later
than January 27, 1998 in order that they may be considered for inclusion in the
proxy statement and form of proxy relating to that meeting.
STOCK OWNERSHIP
The following table sets forth information as of April 1, 1997
relating to the beneficial ownership of KSWI Common Stock by (i) those persons
known to the Company to beneficially own more than 5% of the Company's Common
Stock, (ii) each of the Company's directors, proposed directors and executive
officers and (iii) all of the Company's directors, proposed directors and
executive officers as a group.
NAME AND ADDRESS OF NUMBER OF PERCENTAGE
BENEFICIAL OWNER SHARES OWNERSHIP
Susan Barnes 647,913(1) 11.6%
541 Loring
Los Angeles, CA 90024
Floyd Warkol 1,647,913(2) 29.7%
Meadow Lane
Purchase, NY 10577
Allen & Company 385,000 6.8%
711 Fifth Avenue
New York, NY 10022
Burton Reyer 405,000 7.3%
17 Foxwood Road
Kings Point, NY 11024
Robert Brussel 25,000 .45%
365 Woodmere Blvd.
Woodmere, NY 11598
All executive officers 2,112,913 38%
and directors as a group
As used in this table, "beneficial ownership" means the sole or shared
power to vote, or to direct the voting of a security, or the sole or shared
investment power with respect to a security (i.e., the power to dispose, or
direct the disposition, of a security). Accordingly, they may include shares
owned by or for, among others, the wife, minor children or certain other
relatives of such individual, as well as other shares as to which the individual
has the right to acquire within 60 days after such date.
(1) Includes shares owned by affiliates of Ms. Barnes.
(2) Includes Susan Barnes' shares over which Mr. Warkol has an irrevocable
proxy. Also includes 78,000 shares owned by Mr. Warkol's wife in trust for their
minor daughter, and 78,000 shares owned by Mr. Warkol's son as to which Mr.
Warkol disclaims beneficial ownership.
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEE
The Certificate of Incorporation of the Company provides that KSWI's business
shall be managed by a Board of Directors of not less than three and not more
than twelve, with the exact number to be fixed by the Board of Directors from
time to time. The Board of Directors of KSWI is divided into three classes:
Class I, Class II and Class III, with each class being as nearly equal in number
as possible. The directors in each class serve terms of three years each and
until their successors are elected and qualified.
The Board of Directors has unanimously nominated Robert Brussel for election as
Class I directors of KSWI.. Mr. Brussel is currently a director of KSWI,
appointed in January 1994. The nominee has consented to being named in this
Proxy Statement and to serve if elected. If the nominee becomes unable to accept
nomination or election, the persons named in the proxy may vote for a substitute
nominee selected by the Board of Directors. KSWI's management, however, has no
present reason to believe that any nominee listed below will be unable to serve
as director, if elected.
The By-Laws of KSWI permit nominations of candidates for election to the Board
of Directors to be made by the Board of Directors or by any stockholder entitled
to vote for the election of directors. Nominations made by stockholders (other
than by the Board of Directors) must be made in writing and delivered or mailed
to KSWI not less than 60 days prior to the date of a stockholders' meeting. Such
notice must include the same information, to the extent known to the notifying
stockholder, as that required to be stated by KSWI in its Proxy Statement with
respect to the nominees of the Board of Directors. Any nominations which are not
made in this manner or any votes cast at the Meeting for any candidate not duly
nominated may be disregarded by the chairman of the Meeting.
If a quorum is present and voting, the two nominees receiving the highest number
of votes will be elected to the Board of Directors. Abstentions and broker
non-votes are not counted in the election of directors.
NOMINEES
The following table sets forth certain information concerning the nominee for
election as Class II director of KSWI and the continuing Class I and Class III
directors of KSWI.
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR POSITION, DIRECTOR
NAME AGE OTHER DIRECTORSHIPS SINCE
- -------------------------------------- --------- ---------------------------------------- ------------
NOMINEE AS CLASS II DIRECTOR
TO SERVE UNTIL 2000
<S> <C> <C> <C>
Robert Brussel (1).................. 54 Chief Financial Officer and Director 1994
CONTINUING CLASS III DIRECTORS
TO SERVE UNTIL 1998
Floyd Warkol........................ 49 Chairman of the Board of Directors, 1994
President and Chief Executive Officer
Burton Reyer........................ 62 Executive Vice President, 1994
Secretary and Director
CONTINUING CLASS I DIRECTORS
TO SERVE UNTIL 1999
Armand P. D'Amato................... 53 Director 1995
Daniel Spiegel...................... 72 Director 1996
(1) Robert Brussel owns 25,000 shares of Common Stock and has options to acquire 25,000 shares of Common Stock.
</TABLE>
There is no family relationship between any director or executive officer of the
Company.
Mr. Robert Brussel has been principally employed as Chief Financial
Officer and Director of KSWI and Chief Financial Officer of its subsidiary KSW
Mechanical Inc. since January 1994. From June 1988 to January 1994, he was
principally employed as Chief Financial Officer of Kerby Saunders-Warkol, Inc.
Mr. Floyd Warkol has been principally employed as Chairman of the
Board since December 15, 1995 as President and Chief Executive Officer of KSWI
and as Chairman and Chief Executive Officer of its subsidiary KSW Mechanical,
Inc. since January 1994. From February 1987 to January 1994, he was principally
employed as Chief Executive Officer of Kerby Saunders-Warkol, Inc.
Mr. Burton Reyer has been principally employed as Executive Vice
President and Secretary of KSWI since December 15, 1995 and as Vice President
and Director of KSWI and as President and Chief Operating Officer of its
subsidiary KSW Mechanical Inc. since January 1994. From December 1987 to January
1994, he was principally employed as Chief Operating Officer of Kerby
Saunders-Warkol, Inc.
Mr. Armand P. D'Amato was elected a director on June 27, 1996. He is
an attorney and since 1994 has been President of the Lloyd Group, Inc., a
consulting firm located in Long Island, New York. From 1976 to 1993, he was a
partner at the law firm of Forchelli, Schwartz, Minco and Carlino.
Mr. Daniel Spiegel was elected a director on June 27, 1996. He had
been principally employed as Senior Vice President of Tishman Realty &
Construction Company, Inc. from 1970 until March 1995. He is presently a
consultant to various construction related companies.
<PAGE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors held a total of four meetings in 1996, with
each director present at all meetings. The Board of Directors has a Compensation
Committee and an Audit Committee comprised of non-employee directors. The
functions of the Compensation Committee include: study and analysis of and
recommendations to the Board concerning salaries, incentives and other forms of
compensation for directors, officers and other employees of the Company; and
administrative oversight of various incentive compensation and benefit plans.
The functions of the Audit Committee include: reviewing with independent
auditors the plan and results of the auditing engagement; reviewing the scope
and results of the Company's procedures for internal auditing; reviewing the
independence of the auditors; considering the range of audit and non-audit
services; and reviewing the adequacy of the Company's system of internal
accounting controls.
There were meetings of the Audit Committee and of the Compensation
Committee on November 4, 1996.
COMPENSATION OF DIRECTORS
No fees were paid for attendance at Board Committee meetings. During
1996, the Company paid its non-employee Directors each an annual fee of $12,000.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM COMPENSATION
AWARDS PAYOUTS
SECURITIES
NAME AND PRINCIPAL FISCAL OTHER ANNUAL RESTRICTED UNDERLYING LTIP ALL OTHER
POSITION YEAR SALARY BONUS COMPENSATION STOCK OPTIONS/SARS PAYOUTS COMPENSATION
- ------------------ ---- ------ ----- ------------ -------------- ------------ ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Floyd Warkol......... 1996 $550,000 $0 ------ ------ ------ ------ ------
President and Chief 1995 $525,000 $250,000 ------ ------ ------ ------- ------
Executive Officer
Burton Reyer......... 1996 $300,000 $0 ------ ------ ------ ------ ------
Vice President 1995 $287,500 $125,000 ------ ------ ------ ------ ------
Robert Brussel 1996 $135,000 $32,500 ------ ------ ------ ------ ------
Chief Financial
Officer 1995 $125,000 $30,000 ------ ------ ------ ------ ------
James Oliviero 1996 $150,000 $32,500 ------ ------ ------ ------ ------
Director of 1995 $125,000 $25,000 ------ ------ ------ ------ ------
Investor Relations
</TABLE>
<PAGE>
EMPLOYMENT AGREEMENTS
The Company and KSW Mechanical Inc. entered into a three-year
employment contract and a non-competition agreement with Mr. Warkol as of
January 1, 1994. The employment contract provides for base annual compensation
of $500,000, increasing by $25,000 per annum. Mr. Warkol is also entitled to
medical insurance, (disability insurance with payments equal to 60% of base
compensation,) a $1 million policy of life insurance payable as directed by the
employee (at a cost of $5,775 per year), $10,000 per year in club dues, and a
car and chauffeur, and bonuses if, and when, declared by a two-thirds vote of
the Company's Board of Directors. Mr. Warkol is entitled to terminate his
employment for "good reason," i.e., a substantial change in the nature or status
of his responsibilities or the person to whom he reports, in which event he is
entitled to receive full pay and benefits for the remainder of the term of the
contract. The Company is not entitled to discharge Mr. Warkol for disability
until he has been disabled for 180 consecutive days. Mr. Warkol's estate is
entitled to two-months pay in the event of his death. Mr. Warkol has agreed that
he will not compete in the mechanical contracting business in the New York City
metropolitan area for the term of his employment contract and for two years
thereafter.
The Company and KSW Inc. Mechanical entered into a three-year
employment contract and a non-competition agreement with Mr. Reyer as of January
1, 1994. The employment contract provides for base annual compensation of
$275,000, increasing by $12,500 per annum. Mr. Reyer is entitled to medical
insurance, disability insurance with payments equal to 60% of base compensation,
a $500,000 policy of life insurance payable as directed by the employee, $5,000
per year in club dues and bonuses if, and when, declared by a two-thirds vote of
the Company's Board of Directors. Mr. Reyer is entitled to terminate his
employment for good reason, i.e., a substantial change in the nature or status
of his responsibilities or the person to whom he reports, in which event he is
entitled to receive full pay and benefits for the remainder of the term of the
contract. The Company is not entitled to discharge Mr. Reyer for disability
until he has been disabled for 180 consecutive days. Mr. Reyer's estate is
entitled to two-months pay in the event of his death.
In December 1995, Mr. Warkol and Mr. Reyer agreed to extend their
executive employment agreements for an additional two years, under similar terms
and conditions. Messrs. Warkol and Reyer received salary increases of $25,000 in
each of the two years.
<PAGE>
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN 1996
Individuals Grants Potential Realizable Value
at Assumed Annual Rates of
Stock Price Appreciation Grant Date
For Option Term Value
Number of Percent of Total
Securities Options/SARs
underlying Granted to Exercise of
option/SARs Employees in Base Price Expiration Grant Date
Name Granted (#) Fiscal Year ($/Sh) Date 5% ($) 10% ($) Present Value($)
- ---------------------- ----------- ----------- ------ ---- ------ ------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Floyd Warkol
President and Chief
Executive Officer.... 0 0% $0 N/A 0 0 N/A
Burton Reyer
Vice President....... 0 0% $0 N/A 0 0 N/A
Robert Brussel
Chief Financial
Officer.............. 0 0% $0 N/A 0 0 N/A
James Oliviero
Assistant Secretary,
Director of Investor
Relations............ 0 0% $0 N/A 0 0 N/A
</TABLE>
The Company has not grant any stock appreciation rights ("SARs") since
inception.
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN 1996
AND OPTION/SAR VALUES AT DECEMBER 31, 1996
Number of Securities Value of Unexercised in-
Underlying Unexercised the-Money
Options/SARs at Fiscal Options/SARs at Fiscal
Shares Acquired Year-End (#) Year-End ($)
Name on Exercise (#) Value Realized ($) Exercisable Unexercisable
- ---- --------------- ------------------ ----------- -------------
<S> <C> <C> <C> <C>
Floyd Warkol 0 0 100,000/200,000 37,500/75,000
Burton Reyer 0 0 50,000/100,000 18,750/37,500
Robert Brussel 0 0 8,333/16,667 3,125/6,250
James Oliviero 0 0 6,667/13,333 2,500/5,000
</TABLE>
CERTAIN RELATED PARTY TRANSACTIONS
Susan Barnes, the owner of approximately 12% of KSWI's outstanding shares of
Common Stock, has granted to Mr. Warkol an irrevocable proxy to vote all of the
shares of KSWI Common Stock which were distributed to her, empowering Mr.
Warkol, as President of KSWI, to vote these shares to elect members of the
Company's Board of Directors and to vote in favor of or against any other
matters that come before the stockholders of the Company.
Floyd Warkol, President of the Company and a foundation he controls jointly are
the landlord on the Company's lease in Bronx, New York. The lease payments on
such property were $103,000 for 1996.
<PAGE>
INDEMNIFICATION
Pursuant to a Distribution Agreement and an Indemnification Agreement,
the Company indemnifies and holds Helionetics, Inc., a California corporation
("Helionetics"), its affiliates, successors and assigns and the officers,
directors, partners, employees, agents and representatives of any of them,
harmless from and against any and all assumed or contingent liabilities relating
to or arising in connection with the business of the Company as conducted on the
effective date of Distribution by Helionetics of its KSWI Common Stock to
Helionetics shareholders. If such indemnity is unavailable for any reason the
Company has agreed to contribute in respect of any such loss, claim, damage or
liability on an equitable basis.
The Distribution Agreement and an Indemnification Agreement further
provide that effective upon the Distribution, Helionetics will indemnify and
hold KSWI, its affiliates, successors and assigns and the officers, directors,
partners, employees, agents and representatives of any of them, harmless from
and against any and all liabilities arising under the Securities Act relating to
distribution of the KSWI Common Stock without registration under such act.
The Certificate of Incorporation provides that a director or officer
of the Company may be indemnified by the Company to the full extent permitted by
the Delaware General Corporation Law or any other applicable law.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
AND COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities and Exchange Act of 1934 (the
"Exchange Act") requires the Company's executive officers and directors, and
persons who own more than ten percent of a registered class of the Company's
equity securities to file reports of ownership and changes in ownership with the
Securities and Exchange Commission and the National Association of Securities
Dealers, Inc. Executive officers, directors and greater than ten percent
stockholders are required by SEC regulation to furnish the Company with copies
of all Section 16(a) forms they file. Based solely on its review of the copies
of such forms received by it, or written representation from certain reporting
persons, the Company believes that all executive officers and directors of the
Company complied with all applicable filing requirements.
Susan Barnes, a beneficial owner of more than 10% of issued and
outstanding KSWI Common Stock, has failed to file on a timely basis, reports
required by Section 16(a) of the Securities Exchange Act, as amended, for the
year ended December 31, 1996. On January 2, 1996, Susan Barnes sold 111,163
shares of her common stock to another party. On January 31, 1996, she sold
59,500 shares of her common stock to Allen & Company and 25,500 shares of her
common stock to an Allen & Company Managing Director, Paul A. Gould. On May 6,
1996, Susan Barnes sold 98,882 shares of her common stock purportedly under Rule
144. On December 18, 1996, Susan Barnes sold 625,000 shares of KSW, Inc. stock
in a private transaction in order to satisfy a judgment against Helionetics.
480,000 shares of this stock were purchased by Floyd Warkol and 145,000 shares
were purchased by Burton Reyer. Ms. Barnes has failed to file a Form 4 or a Form
5 to report these transactions.
REPORT OF THE COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION
The following report submitted by the Compensation Committee of the
Board of Directors (the "Compensation Committee"), provides information
regarding policies and practices concerning compensation of the Chief Executive
Officer and other executive officers.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Company's Compensation Committee has the responsibility for
setting the compensation paid to the Chief Executive Officer and for final
approval of the compensation paid to the other executive officers of the Company
and its subsidiary, approving or disapproving the recommendation of the Chief
Executive Officer as to such compensation. The Compensation Committee, which is
comprised of the two non-employee Directors of the Company, determines the
amount of shares and exercise prices for any stock option grants under the
Company's 1995 Stock Option Plan, and the amount of the Company's matching
contribution percentage under the Company's Retirement Savings 401(k) Plan. The
Compensation Committee is responsible for recommending to the Board the overall
Compensation plans which govern the compensation of the key executive officers,
including the Chief Executive Officer of the Company. Executives are provided
with a combination of one or more of the following types of compensation:
salary, annual bonus and grants of stock options.
SALARY: All executive officers are provided with a fixed annual salary
that is reviewed on an annual basis by the Compensation Committee and the Chief
Executive Officer. Salary and increases in salary are determined partially by
comparison of the executive's salary to salaries for similar positions at
comparable companies, the executive's annual performance review, the value of
contributions made by the executive and the executive's and the Company's
performance in relation to goals established at the beginning of the period.
In addition to considering the above factors when setting compensation
increases, the Compensation Committee also considers the overall financial
health of the Company.
ANNUAL BONUS: The Company also attempts to motivate its executives to
make contributions of outstanding value by providing them the opportunity to
earn an annual bonus. These bonuses, if paid, can represent a significant
portion of the executive's compensation.
Together the Chief Executive Officer and the Compensation Committee
determine the total pool of bonus dollars which can be allocated. Each executive
can earn a percentage of the bonus dollars based on the achievement of Company
and their organization's goals: For all executives, except Mr. Warkol, the
executive's achievements in relation to established goals are evaluated by the
Chief Executive Officer. Mr. Warkol's performance is evaluated by the
Compensation Committee. Like other executives, the decision to grant Mr. Warkol
a bonus is based on the performance of the Company and Mr. Warkol's
contributions to the Company in the past fiscal year. The salaries and bonuses
paid to executive officers during 1996 are described in the Summary Compensation
Table (above).
STOCK OPTION AND OTHER EQUITY PLAN; COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The Committee endorses the view that the value of compensation paid to
its executive officers, and the Chief Executive Officer in particular, should be
closely linked to increases in the value of the Common Stock. Accordingly, the
Committee supports option awards under the Company's 1995 Stock Option Plan.
The compensation paid to executive officers is not determined by
reference to any formulas but is determined by the Compensation Committee's
evaluation of the particular officer's ability to influence the long-term growth
and profitability of the Company. The Committee also considers the Company's
performance against certain of its competitors, its general performance against
internal goals established by management, and the executive's relative
contribution thereto. No stock options were granted in 1996.
This report is submitted by the members of the Compensation Committee.
Daniel Spiegel and Armand P. D'Amato are members of the Committee.
<PAGE>
PERFORMANCE TABLE
The following performance table is being provided from February 1,
1996, the date that the Company's Common Stock began publicly trading on the
NASDAQ Electronic Bulletin Board.
QUARTER HIGH LOW
- ------- ---
First $2.75 $2.00
Second 3.18 1.75
Third 2.12 1.50
Fourth 1.87 1.50
PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has selected Marden Harrison & Kreuter,
certified public accountants, as the Company's independent auditors for the
fiscal year ending December 31, 1997, subject to ratification of such
appointment by the stockholders. In the event of a negative vote on
ratification, the Board of Directors will reconsider its selection.
Marden Harrison & Kreuter conducted the audit of the financial
statements of KSW, Inc. and its subsidiary for the fiscal year ended December
31, 1996.
It is expected that a representative of Marden Harrison & Kreuter will
be present at the Annual Meeting of Stockholders.
The Board unanimously recommends a vote "FOR" the ratification of the
appointment of Marden, Harrison & Kreuter as the Company's independent auditors
for the 1997 fiscal year.
PROPOSAL NO. 3
OTHER MATTERS
The Company knows of no other matter so be submitted at the meeting.
If any other matters properly come before the meeting, it is the intention of
the persons named in the enclosed form of Proxy to vote the shares they
represented as the Board of Directors may recommend.
STOCKHOLDERS PROPOSALS
The Company's By-Laws provide that a stockholder of the Company who
intends to nominate persons for election as Directors or introduce other
proposals from the floor of an Annual Meeting of Stockholders follow certain
notice and disclosure requirements.
The By-Laws provision requires a stockholder introducing a proposal at
an Annual Meeting to notify the Company of such intention not less than 60 days
prior to the date of the Annual Meeting. If the Company has given less than 75
days public notice of the date of the Annual Meeting, the stockholder must give
such notice so that it is received by the Company not later than 10 days after
the public notice is given or the Proxy Statement is mailed. The stockholder's
notice must give the information specified in the By-Laws, including information
about the stockholder making the proposal, the number of shares such stockholder
owns and any interest such stockholder may have in the subject of the proposal.
If such stockholder will be nominating persons for election as Directors,
certain information specified in the By-Laws must also be given about the
nominee and the nominee's interest in the Company.
ANNUAL REPORT
UPON WRITTEN REQUEST OF ANY STOCKHOLDER, A COPY OF KSWI'S ANNUAL
REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED DECEMBER 31, 1996, INCLUDING A
LIST OF THE EXHIBITS THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 13a-1 UNDER THE SECURITIES & EXCHANGE ACT
OF 1934, MAY BE OBTAINED, WITHOUT CHARGE, FROM JAMES OLIVIERO, ASSISTANT
SECRETARY, KSW, INC., 37-16 23RD STREET, LONG ISLAND CITY, NEW YORK 11101. EACH
REQUEST MUST SET FORTH A GOOD FAITH REPRESENTATION THAT, AS OF THE RECORD DATE,
THE PERSON MAKING THE REQUEST WAS A BENEFICIAL OWNER OF KSWI'S COMMON STOCK
ENTITLED TO VOTE AT THE MEETING.
BY ORDER OF THE BOARD OF
DIRECTORS
JAMES OLIVIERO
ASSISTANT SECRETARY
PLEASE REMEMBER TO MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED POSTAGE-PAID ENVELOPE SO THAT YOUR IMPORTANT VOTE WILL BE COUNTED AT
THE ANNUAL MEETING.
<PAGE>
PROXY
KSW, INC.
ANNUAL MEETING OF STOCKHOLDERS, MAY 5, 1997
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints __________________________________, or
a majority of those present and acting, or if only one is present, then that
one, proxies, with full power of substitution, to vote all shares of KSW, INC.
which the undersigned is entitled to vote at the Company's Annual Meeting to be
held at the Crown Plaza Hotel at LaGuardia Airport, Flushing, New York, on May
5, 1997, at 2:00 p.m., New York time, and at any adjournment thereof, hereby
ratifying all that said proxies or their substitutes may do by virtue hereof,
and the undersigned authorizes and instructs said proxies to vote as follows:
1. ELECTION OF DIRECTOR: To elect a nominee as a class II directors below for
a three-year term.
/ / FOR the nominee listed below except as WITHHOLD AUTHORITY
marked to the contrary below) / / to vote for the nominee
listed blow
Nominee for Director for term expiring in 2000.
Robert Brussel
2. APPOINTMENT OF INDEPENDENT AUDITORS: Check the appropriate box to indicate
the manner in which you direct the proxies to vote your shares:
/ / FOR the ratification of the appointment of Marden, Harrison & Kreuter
/ / AGAINST the ratification of the appointment of Marden, Harrison & Kreuter
/ / ABSTAIN
3. In their discretion, upon any other matters which may properly come before
the meeting or any adjournments thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE NOMINEE LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2.
<PAGE>
Receipt of the Notice of Annual Meeting and Proxy Statement of the
Company preceding or accompanying the same is hereby acknowledged.
Dated , 1997
(Signature of Stockholder)
(Signature of Stockholder)
Your signature should appear the same as
your name appears hereon. If signing as
attorney, executor, administrator,
trustee or guardian, please indicate the
capacity in which signing. When signing
as joint tenants, all parties to the
joint tenancy must sign. When the proxy
is given by a corporation it should be
signed by and authorized officer.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY USING THE
ENCLOSED ENVELOPE.
