SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to /section/240.14a-11(c) or
/section/240.14a-12
AVIATION SALES COMPANY
(Name of Registrant as Specified in Its Charter)
(Name of Persons(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
AVIATION SALES COMPANY
6905 N.W. 25TH STREET
MIAMI, FLORIDA 33122
(305) 592-4055
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------------
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Stockholders of
Aviation Sales Company, a Delaware corporation (the "Company"), will be held on
November 19, 1999 at 10:00 a.m., local time, at the Doral Golf Resort and Spa,
4400 N.W. 87th Avenue, Miami, Florida, for the following purposes, all of which
are set forth more completely in the accompanying proxy statement:
(1) To elect three persons to the Board of Directors, one to serve until
the 2000 Annual Meeting of Stockholders, one to serve until the 2001
Annual Meeting of Stockholders and one to serve until the 2002 Annual
Meeting of Stockholders, or until election and qualification of their
respective successors;
(2) To approve an amendment to the Company's 1996 Stock Option Plan to
increase the number of shares of common stock for which options may be
granted under such plan from the greater of 650,000 shares of common
stock or 8% of the number of shares of common stock then outstanding to
the greater of 2,250,000 shares of common stock or 15% of the number of
shares of common stock then outstanding;
(3) To ratify the selection of the Company's independent auditors for the
1999 fiscal year; and
(4) To transact such other business as may properly come before the
meeting.
Pursuant to the Company's Bylaws, the Board of Directors has fixed the
close of business on September 24, 1999 as the record date for the determination
of stockholders entitled to notice of and to vote at the Annual Meeting.
A FORM OF PROXY IS ENCLOSED. IT IS IMPORTANT THAT PROXIES BE RETURNED
PROMPTLY. THEREFORE, WHETHER OR NOT YOU PLAN TO BE PRESENT IN PERSON AT THE
ANNUAL MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE
ENCLOSED ENVELOPE, WHICH DOES NOT REQUIRE POSTAGE IF MAILED IN THE UNITED
STATES.
BY ORDER OF THE BOARD OF DIRECTORS
Dale S. Baker, Chairman of the Board
Miami, Florida
October 15, 1999
<PAGE>
AVIATION SALES COMPANY
6905 N.W. 25TH STREET
MIAMI, FLORIDA 33122
(305) 592-4055
----------------
PROXY STATEMENT
----------------
The enclosed proxy is solicited by the Board of Directors (the "Board")
of Aviation Sales Company, a Delaware corporation (the "Company"), for use at
the 1999 Annual Meeting of Stockholders ("Annual Meeting") to be held on
November 19, 1999 at 10:00 a.m., local time, at the Doral Golf Resort and Spa,
4400 N.W. 87th Avenue, Miami, Florida. The approximate date on which this
statement and the enclosed proxy will be sent to stockholders will be October
15, 1999. The form of proxy provides a space for you to withhold your vote for
any proposal. You are urged to indicate your vote on each matter in the space
provided. If signed but no space is marked, it will be voted by the persons
therein named at the meeting: (i) for the election of three directors, one to
serve until the 2000 annual meeting of stockholders, one to serve until the 2001
annual meeting of stockholders and one to serve until the 2002 annual meeting of
stockholders, or until their respective successors are elected and qualified,
(ii) for the approval of an amendment to the Company's 1996 Stock Option Plan as
provided herein, (iii) for the ratification of the selection of the Company's
independent auditors for the 1999 fiscal year, and (iv) in their discretion,
upon such other business as may properly come before the meeting.
Whether or not you plan to attend the Annual Meeting, please fill in,
sign and return your proxy card to the transfer agent in the enclosed envelope,
which requires no postage if mailed in the United States.
The cost of the Board's proxy solicitation will be borne by the
Company. In addition to solicitation by mail, directors, officers and employees
of the Company may solicit proxies personally and by telephone and telegraph,
all without extra compensation.
At the close of business on September 24, 1999 (the "Record Date"), the
Company had outstanding 15,011,925 shares of common stock, $.001 par value per
share ("Common Stock"). Each share of Common Stock entitles the holder thereof
on the Record Date to one vote on each matter submitted to a vote of
stockholders at the Annual Meeting. Only stockholders of record at the close of
business on the Record Date are entitled to notice of and to vote at the Annual
Meeting. In the event that there are not sufficient votes for approval of any of
the matters to be voted upon at the Annual Meeting, the Annual Meeting may be
adjourned in order to permit further solicitation of proxies. The quorum
necessary to conduct business at the Annual Meeting consists of a majority of
the outstanding shares of Common Stock.
Shares represented by proxies which are marked "abstain" or which are
marked to deny discretionary authority will only be counted for determining the
presence of a quorum. Votes withheld in connection with the election of one or
more of the nominees for director will not be counted as votes cast for such
individuals. In addition, where brokers are prohibited from exercising
discretionary authority for beneficial owners who have not provided voting
instructions (commonly referred to as "broker non-votes"), those shares will not
be included in the vote totals.
A list of the stockholders entitled to vote at the Annual Meeting will
be available at the Company's principal executive office located at 6905 N.W.
25th Street, Miami, Florida 33122 for a period of ten (10) days prior to the
Annual Meeting for examination by any stockholder.
A STOCKHOLDER WHO SUBMITS A PROXY ON THE ACCOMPANYING FORM HAS THE
POWER TO REVOKE IT AT ANY TIME PRIOR TO ITS USE BY DELIVERING A WRITTEN NOTICE
TO THE CORPORATE SECRETARY OF THE COMPANY, BY EXECUTING A LATER-DATED PROXY OR
BY ATTENDING THE MEETING AND VOTING IN PERSON. UNLESS AUTHORITY IS WITHHELD,
PROXIES WHICH ARE PROPERLY EXECUTED WILL BE VOTED FOR THE PURPOSES SET FORTH
THEREON.
<PAGE>
BOARD OF DIRECTORS
The Articles of Incorporation and Bylaws of the Company presently
provide for a Board of Directors divided into three classes, as equal in size as
possible, with staggered terms of three years. At the date of this Proxy
Statement, the current members of the Board and the expiration of their terms as
Directors were as follows:
<TABLE>
<CAPTION>
TERM
NAME AGE POSITIONS EXPIRES
- ----------------------------- ----- --------------------------------------- --------
<S> <C> <C> <C>
Dale S. Baker .............. 41 Chairman of the Board and President 1999
Harold M. Woody ............ 54 Director and Executive Vice President 1999
of the Company and President of the
Company's leasing operations
Robert Alpert .............. 50 Director 2001
Sam Humphreys .............. 39 Director 2000
Philip B. Schwartz ......... 45 Director and Corporate Secretary 1999
</TABLE>
Kazutami Okui, who previously served as a director of the Company, resigned
from his director position on February 8, 1999. George F. Baker, III and
Jeffrey N. Greenblatt, each of whom previously served as a director of the
Company, resigned from their respective director positions on June 25, 1999.
BUSINESS EXPERIENCE
DALE S. BAKER has been the President of the Company and its
predecessors since February 1992. Prior to joining Aviation Sales, Mr. Baker was
Senior Vice President and Manager of GE Capital's Corporate Investment Finance
Group. Mr. Baker has been a director since June 1996.
HAROLD M. WOODY has been the Executive Vice President of the Company
and its predecessors since February 1992 and the President of the Company's
leasing operations since March 1997. Mr. Woody has been a director since June
1996.
ROBERT ALPERT is a private investor. In addition to his investment in
the Company, Mr. Alpert has invested significantly in business ventures in the
steel, environmental, waste and oil service industries. Mr. Alpert has been a
director since June 1996.
SAM HUMPHREYS is a Managing Director of Main Street Merchant Partners,
a merchant banking firm, and has been a partner in that firm and its predecessor
since January 1996. Since March 1997, Mr. Humphreys has also been the Chairman
of PalEx, Inc., the largest manufacturer of pallets in the United States. From
April 1993 until March 1997, Mr. Humphreys held various executive positions with
U.S. Delivery Systems, Inc., a provider of same-day local delivery services, and
Envirofil, Inc., an environmental services company. Mr. Humphreys has been a
director since June 1996.
PHILIP B. SCHWARTZ is a shareholder in the Florida law firm of Akerman,
Senterfitt & Eidson, P.A., practicing in the firm's Miami office. Prior to
joining Akerman Senterfitt in September 1995, Mr. Schwartz was a partner with
Broad and Cassel, Miami, Florida, for five years. Mr. Schwartz is a member of
The Florida Bar and the American Bar Association and a former Chair of the
Business Law Section of The Florida Bar. Akerman Senterfitt performs legal
services for the Company. Mr. Schwartz has been a director since June 1998 and
Corporate Secretary since March 1999.
2
<PAGE>
NOMINEES TO THE BOARD
At the Annual Meeting, three directors will be elected to serve. The
Board has nominated the following persons for election to the Board:
DALE S. BAKER. Mr. Baker has been nominated to serve until the 2002
Annual Meeting of Stockholders. For biographical information regarding Mr.
Baker, see "Board of Directors" above.
HAROLD M. WOODY. Mr. Woody has been nominated to serve until the 2000
Annual Meeting of Stockholders. For biographical information regarding Mr.
Woody, see "Board of Directors" above.
PHILIP B. SCHWARTZ. Mr. Schwartz has been nominated to serve until the
2001 Annual Meeting of Stockholders. For biographical information regarding Mr.
Schwartz, see "Board of Directors" above.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board has the responsibility for establishing broad corporate
policies and for the overall performance of the Company. Standing committees of
the Board are the executive committee, the audit committee and the compensation
committee. The Board of Directors has no nominating committee or any committee
performing such function.
The executive committee is authorized to act between meetings of the
Board of Directors and to exercise in full the powers of the Board, subject to
such limitations as are imposed by law. The members of the executive committee
are Dale S. Baker, Harold M. Woody, Robert Alpert and Sam Humphreys. The
executive committee held no meetings during the fiscal year ended December 31,
1998.
The audit committee maintains communications between the Board and the
Company's independent auditors, monitors performance of the independent
auditors, reviews audit scope and results, reviews the organization and
performance of the Company's internal systems of audit and financial controls,
and recommends the retention or, where appropriate, the replacement of
independent auditors. The members of the audit committee are Philip B. Schwartz
and Sam Humphreys. The audit committee did not meet during the fiscal year ended
December 31, 1998.
The compensation committee reviews and approves compensation policies
and practices for all elected corporate executive officers and fixes the total
compensation of the Chief Executive Officer. The compensation committee also
administers the Company's 1996 Stock Option Plan and the 1996 Director Stock
Option Plan. The members of the compensation committee are Robert Alpert and Sam
Humphreys. The compensation committee held one meeting and acted five times by
written consent during the fiscal year ended December 31, 1998.
The Board of Directors will consider director candidates recommended by
stockholders. Any stockholder wishing to submit a recommendation to the Board of
Directors with respect to the 2000 Annual Meeting of Stockholders should send a
signed letter of recommendation to Aviation Sales Company, 6905 N.W. 25th
Street, Miami, Florida 33122, Attention: Corporate Secretary. To be considered,
recommendation letters must be received prior to March 31, 2000, must state the
reasons for the recommendations and contain the full name and address of each
proposed nominee, as well as a brief biographical history setting forth past and
present directorships, employment and occupations. The recommendation letter
must also include a statement indicating that such nominee has consented to
being named in the proxy statement and to serve if elected.
The Board of Directors of the Company held a total of eight meetings
and acted three times by written consent in lieu of a meeting during the fiscal
year ended December 31, 1998. Each of the directors attended at least 75% of the
aggregate number of meetings of the Board of Directors.
3
<PAGE>
COMPENSATION OF DIRECTORS
Each director who is not an employee of the Company receives an annual
retainer fee at the rate of $12,000 per year for serving in such capacity. In
addition, each director who is not an employee of the Company receives $1,000
for each meeting of the Board of Directors attended and $1,000 for each
committee meeting attended.
All directors receive on an annual basis mandatory stock option grants
under the 1996 Director Stock Option Plan for serving on the Board. Five-year
options to purchase 5,000 shares of Common Stock are automatically granted to
each director on July 1 of each year, at an option exercise price equal to the
closing price of the Common Stock on such date. All such options are immediately
exercisable on the date of grant. Existing directors, upon the organization of
the Company, were granted five-year options to purchase 10,000 shares of Common
Stock at an option exercise price equal to the initial public offering price.
Additionally, directors appointed to the Board after the organization of the
Company are granted options to purchase 10,000 shares of Common Stock at the
time they are appointed to the Board, at an option exercise price equal to the
closing price of the Common Stock on the date of their appointment to the Board.
EXECUTIVE OFFICERS
The following list reflects the Company's executive officers, as of
this date, the capacity in which they serve the Company, and when they assumed
office:
<TABLE>
<CAPTION>
EXECUTIVE
NAME AGE POSITIONS OFFICER SINCE
- -------------------------- ----- ---------------------------------------------- ---------------
<S> <C> <C> <C>
Dale S. Baker . 41 President February 1992
Harold M. Woody . 54 Executive Vice President of the Company February 1992
and President of the Company's leasing
operations
William H. Alderman . 37 Senior Vice President, Corporate Development September 1996
James D. Innella . 40 Senior Vice President of the Company December 1994
and President of the Company's redistribution
operations
Benito Quevedo . 45 Senior Vice President of the Company July 1998
and President of the Company's maintenance
and repair operations
Garlan Braithwaite . 65 Vice President, Finance and Treasurer February 1999
Gary Eakins . 45 Vice President and Chief Legal Officer July 1998
Richard Hutchinson . 41 Chief Information Officer July 1998
Michael A. Saso . 46 Senior Vice President, Purchasing of the December 1994
Company's redistribution operations
Laura DeCespedes . 42 Vice President, Human Resources January 1999
</TABLE>
4
<PAGE>
BUSINESS EXPERIENCE
DALE S. BAKER. See the biographical information contained in "Board of
Directors" above.
HAROLD M. WOODY. See the biographical information contained in "Board
of Directors" above.
WILLIAM H. ALDERMAN has been the Senior Vice President, Corporate
Development since September 1996. Prior to joining the Company, from May 1995 to
September 1996, Mr. Alderman was a Managing Director and principal of the
financial advisory firm of International Aviation Management Group. Prior to
joining International Aviation Management Group, Mr. Alderman was Vice President
of Structured Finance of GE Capital Aviation Services.
JAMES D. INNELLA was Vice President and Chief Operating Officer of the
Company from December 1994 until July 1998, when he became Senior Vice President
of the Company and President of the Company's redistribution operations. Prior
thereto, for more than five years, Mr. Innella served in various capacities with
the Aviation Sales business unit of Aviall, Inc. and with Ryder Airlines
Services.
BENITO QUEVEDO has been the Senior Vice President of the Company and
President of the Company's maintenance and repair operations since July 1998.
Prior to joining the Company, Mr. Quevedo was the principal shareholder and
President of Caribe Aviation and Aircraft Interior Design.
GARLAN BRAITHWAITE has been the Vice President, Finance of the Company
since February 1999. From July 1998 to February 1999, Mr. Braithwaite was a
consultant to the Company, and from August 1997 to July 1998, Mr. Braithwaite
was the Senior Vice President and Chief Financial Officer of Whitehall
Corporation. From 1990 through 1997, Mr. Braithwaite was the President of Dragon
Investment Corp., which made investments in small service businesses.
GARY EAKINS has been the Vice President and Chief Legal Officer of the
Company since July 1998. Prior thereto, for more than five years, Mr. Eakins
served as Vice President, Secretary and General Counsel of Southern Air
Transport. Southern Air Transport filed for bankruptcy on October 1, 1998.
RICHARD HUTCHINSON has been with the Company since January 1997 and has
been Chief Information Officer of the Company since July 1998. From March 1995
to December 1996, Mr. Hutchinson was Senior Business Analyst, IT Manager,
Project Leader and Technical Consultant for Racal Data Group, an international
source of computer networking systems and services. From September 1994 to March
1995, Mr. Hutchinson served as a consultant on various projects. From January
1991 to September 1994, Mr. Hutchinson served as Director of Information
Services for Burt Hill Kosar Rittelmann Associates.
MICHAEL A. SASO has been Senior Vice President, Purchasing of the
Company's redistribution operations since December 1994. From 1986 until
December 1994, Mr. Saso served as Vice President, Purchasing for the Aviation
Sales business unit of Aviall, Inc.
LAURA DECESPEDES has been Vice President, Human Resources of the
Company since January 1999. Prior to joining the Company, from September 1997 to
December 1998, Ms. DeCespedes was the Vice President of Human Resources for
Productivity Point International. From June 1995 to September 1997, Ms.
DeCespedes was Director of Field Human Resources for Sensormatic Electronics
Corp.
FAMILY RELATIONSHIPS
There are no family relationships between or among any of the directors
and executive officers.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information about the compensation paid
or accrued during 1998, 1997 and 1996 to the Company's Chief Executive Officer
and to each of the four other most highly compensated executive officers of the
Company whose aggregate direct compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
------------------------------ OTHER ALL
SALARY BONUS ANNUAL OTHER
NAME AND PRINCIPAL POSITION YEAR ($) ($) COMPENSATION COMPENSATION
- ------------------------------ ------ --------- --------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Dale S. Baker 1998 263,797 197,848 (1) --
President and 1997 258,670 212,627 (1) --
Chief Executive Officer 1996 248,416 124,208 (1) --
Harold M. Woody 1998 236,029 177,021 -- --
Executive Vice President and 1997 231,442 116,385 -- --
President of the Company's 1996 222,267 111,134 -- --
leasing operations
Michael A. Saso 1998 186,888 140,166 -- --
Senior Vice President, 1997 186,889 153,613 -- --
Purchasing of the Company's 1996 135,975 67,988 -- --
redistribution operations
Joseph E. Civiletto(2) 1998 175,000 131,250 -- --
1997 141,588 116,385 -- --
1996 135,975 67,988 -- --
James D. Innella 1998 225,000 168,750 -- --
Senior Vice President and 1997 153,735 126,370 -- --
President of the Company's 1996 141,997 70,959 -- --
redistribution operations
</TABLE>
- ----------------
(1) Mr. Baker also receives $5,000 per year for life insurance premiums. See
"Employment Agreements" below.
(2) Mr. Civiletto resigned from his position as Vice President and Chief
Financial Officer of the Company in February 1999.
No long-term compensation awards were made to management during the
three years ended December 31, 1998.
6
<PAGE>
OPTION GRANTS DURING LAST FISCAL YEAR
The following table sets forth information concerning options to
purchase shares of Common Stock granted during the fiscal year ended December
31, 1998 to those persons named in the Summary Compensation Table.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
% OF TOTAL APPRECIATION
NUMBER OF OPTIONS GRANTED FOR OPTION TERM(1)
SHARES UNDERLYING TO EMPLOYEES EXERCISE PRICE EXPIRATION ----------------------
NAME OPTIONS GRANTED IN FISCAL YEAR ($/SHARE) DATE 5%($) 10%($)
- ----------------------------- ------------------- ---------------- ---------------- ----------- --------- ------------
<S> <C> <C> <C> <C> <C> <C>
Dale S. Baker ............... 25,000 5.6 24.50 09/15/08 385,250 976,167
5,000 1.1 37.00 07/01/08 116,346 294,842
Harold M. Woody ............. 15,000 3.4 24.50 09/15/08 231,150 585,700
5,000 1.1 37.00 07/01/08 116,346 294,842
Michael A. Saso ............. 15,000 3.4 24.50 09/15/08 231,150 585,700
Joseph E. Civiletto ......... 15,000 3.4 31.05 05/06/99 35,513 72,191
15,000 3.4 24.50 05/06/99 28,022 56,963
James D. Innella ............ 25,000 5.6 35.25 06/12/08 554,213 1,404,485
15,000 3.4 24.50 09/15/08 231,150 585,700
</TABLE>
- ----------------
(1) These amounts represent assumed rates of appreciation in the price of
common stock during the term of the options in accordance with rates
specified in applicable federal securities regulations. Actual gains, if
any, on stock option exercises will depend on the future price of common
stock and overall stock market conditions. There is no representation that
the rates of appreciation reflected in the table will be achieved.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
The following table sets forth information concerning the exercise of
stock options to purchase Common Stock during the 1998 fiscal year and the value
of unexercised stock options to purchase Common Stock at the end of the 1998
fiscal year for the persons named in the Summary Compensation Table.
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
NUMBER OF VALUE OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END($)
SHARES ACQUIRED REALIZED ---------------------------- ---------------------------
NAME ON EXERCISE ($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE*
- ----------------------------- ----------------- --------- ---------------------------- ---------------------------
<S> <C> <C> <C> <C>
Dale S. Baker ............... -- -- 38,250/16,750 602,381/270,094
Harold M. Woody ............. -- -- 34,950/10,050 549,169/162,056
Michael A. Saso ............. -- -- 14,999/10,001 234,359/161,266
Joseph E. Civiletto ......... -- -- 31,666/18,334 495,115/260,385
James D. Innella ............ -- -- 38,332/26,668 541,024/250,851
</TABLE>
- ----------------
* Computed based upon the difference between the closing price of common stock
at December 31, 1998 and the exercise price. No value has been assigned to
options which are not in-the-money.
7
<PAGE>
EMPLOYMENT AGREEMENTS
On January 1, 1999, the Company entered into an employment agreement
with Dale S. Baker. The employment agreement provides for an annual base salary
of $550,000 (to be increased annually by a cost of living adjustment). In
addition, the Company agreed to provide Mr. Baker with all employee benefits
available under benefit plans established by the Company, and to pay Mr. Baker
an additional sum of $5,000 per year for insurance premiums to maintain a whole
life insurance policy. The employment agreement requires Mr. Baker to use his
best efforts to perform the duties of President and Chief Executive Officer. The
agreement provides for a term expiring on January 1, 2002.
The employment agreement further provides for an option grant to
purchase 350,000 shares of common stock (granted outside of any plan) at $40.625
per share, with one-third of the options granted vesting on January 1, 2000,
one-third of the options granted vesting on January 1, 2001, and one-third of
the options granted vesting on January 1, 2002. The employment agreement also
provides for Mr. Baker's participation in the Company's 1999 EBITDA Plan which
allows him to earn an incentive bonus of between 50% and 125% of his base
salary.
Mr. Woody has an employment agreement with the Company under which he
is entitled to an annual base salary of $212,500 (to be increased annually by a
cost of living adjustment), and all employee benefits available under benefit
plans established by the Company. This employment agreement provides for an
initial term expiring on December 31, 1999. Thereafter, the respective agreement
shall run for successive one-year periods unless the Company terminates the
agreement upon six months' prior written notice, or Mr. Woody terminates the
agreement upon three months' prior written notice.
On January 1, 1999, the Company entered into employment agreements with
James D. Innella and Benito Quevedo to serve as Senior Vice Presidents and as
President of the Company's redistribution operations and maintenance and repair
operations, respectively, under which they are each entitled to an annual base
salary of $350,000 (to be increased annually by a cost of living adjustment),
and all employee benefits available under benefit plans established by the
Company. Mr. Innella's and Mr. Quevedo's agreements provide for a term expiring
on January 1, 2003 and January 1, 2002, respectively.
The employment agreements with Messrs. Innella and Quevedo further
provide for option grants to each to purchase 175,000 shares of common stock
(granted outside of any plan) at $40.625 per share, with one-third of the
options granted vesting on January 1, 2000, one-third of the options granted
vesting on January 1, 2001, and one-third of the options granted vesting on
January 1, 2002. The employment agreements also provide for Messrs. Innella's
and Quevedo's participation in the Company's 1999 EBITDA Plan, which provides
each with the opportunity to earn an incentive bonus of between 50% and 125% of
his base salary.
Mr. Saso has an employment agreement with the Company under which he
serves as Senior Vice President, Purchasing of the Company's redistribution
operations and is entitled to an annual base salary of $185,000 (to be increased
annually by a cost of living adjustment), and all employee benefits available
under benefit plans established by the Company. The agreement provides for an
initial term expiring on May 31, 2001, running for successive one-year terms
thereafter, unless the Company terminates the agreement upon six months' prior
written notice, or Mr. Saso terminates the agreement upon three months' prior
written notice.
The employment agreements with Messrs. Woody and Saso also provide for
their participation in the Company's 1997 EBITDA Incentive Compensation Plan,
which provides that each of them has the opportunity to earn an incentive bonus
of between 20% and 250% of their base salary.
Further, each of the Company's employment agreements provides for
certain benefits in the event of a change of control.
8
<PAGE>
Section 162(m) of the Internal Revenue Code generally disallows an
income tax deduction to public companies for compensation over $1.0 million paid
in a year to any one of the chief executive officer or the four most highly
compensated other executive officers, to the extent that this compensation is
not "performance based" within the meaning of Section 162(m). As a result of
this limitation, the Company cannot provide assurance that all of the
compensation paid to the Company's executive officers in the future will be
deductible.
STOCK OPTION PLANS
The Company's Board of Directors and shareholders adopted two stock
option plans (the "Plans"). Pursuant to the 1996 Director Stock Option Plan (the
"Director Plan"), options to acquire a maximum of the greater of 150,000 shares
or 2% of the number of shares of Common Stock then outstanding may be granted to
directors of the Company. Pursuant to the 1996 Stock Option Plan (the "1996
Plan"), options to acquire a maximum of the greater of 650,000 shares of Common
Stock or 8% of the number of shares of Common Stock then outstanding may be
granted to executive officers, employees (including employees who are
directors), independent contractors and consultants of the Company. See Proposal
2. Options to purchase 915,515 shares at exercise prices ranging from $19.00 per
share to $37.44 per share are currently outstanding under the 1996 Stock Option
Plan, 359,974 of which are immediately exercisable. Options to purchase 140,000
shares are currently outstanding under the Director Plan, 123,332 of which are
immediately exercisable.
The compensation committee administers both the Director Plan and the
1996 Plan. The compensation committee determines which persons will receive
options and the number of options to be granted to such persons. The Director
Plan also provides for annual mandatory grants of options to directors. See
"Compensation of Directors." The compensation committee also interpret the
provisions of the Plans and makes all other determinations that it deems
necessary or advisable for the administration of the Plans.
Pursuant to the Plans, the Company may grant Incentive Stock Options
("ISOs") as defined in Section 422(b) of the Internal Revenue Code of 1986, as
amended, (the "Code"), and Non-Qualified Stock Options ("NQSOs"), not intended
to qualify under Section 422(b) of the Code. The price at which the Company's
Common Stock may be purchased upon the exercise of options granted under the
Plans will be required to be at least equal to the per share fair market value
of the Common Stock on the date the particular options are granted. Options
granted under the Plans may have maximum terms of not more than 10 years and are
not transferable, except by will or the laws of descent and distribution. None
of the ISOs under the Plans may be granted to an individual owning more than 10%
of the total combined voting power of all classes of stock issued by the Company
unless the purchase price of the Common Stock under such option is at least 110%
of the fair market value of the shares issuable on exercise of the option
determined as of the date the option is granted, and such option is not
exercisable more than five years after the grant date.
Generally, options granted under the Plans may remain outstanding and
may be exercised at any time up to three months after the person to whom such
options were granted is no longer employed or retained by the Company or serving
on the Company's Board of Directors.
Pursuant to the Plans, unless otherwise determined by the compensation
committee, one-third of the options granted to an individual are exercisable
upon grant, one-third are exercisable on the first anniversary of such grant and
the final one-third are exercisable on the second anniversary of such grant.
However, options granted under the Plans shall become immediately exercisable if
the holder of such options is terminated by the Company or is no longer a
director of the Company, as the case may be, subsequent to certain events which
are deemed to be a "change in control" of the Company. A "change in control" of
the Company generally is deemed to occur when (a) any person becomes the
beneficial owner of or acquires voting control with respect to more than 20% of
the Common Stock (or 35% if such person was a holder of Common Stock on July 2,
1996, the effective date of the Company's initial public offering); (b) a change
occurs in the composition of a majority of the
9
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Company's Board of Directors during a two-year period, provided that a change
with respect to a member of the Company's Board of Directors shall be deemed
not to have occurred if the appointment of a member of the Company's Board of
Directors is approved by a vote of at least 75% of the individuals who
constitute the then existing Board of Directors; or (c) the Company's
stockholders approve the sale of all or substantially all of the Company's
assets.
ISOs granted under the Plans are subject to the restriction that the
aggregate fair market value (determined as of the date of grant) of options
which first become exercisable in any calendar year cannot exceed $100,000.
The Plans provide for appropriate adjustments in the number and type of
shares covered by the Plans and options granted thereunder in the event of any
reorganization, merger, recapitalization or certain other transactions involving
the Company.
10
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PERFORMANCE GRAPH
The following graph compares the total return on the Company's Common
Stock with the cumulative total return on the Standard & Poor's ("S&P") 500
Index, the S&P Midcap 400 Index, the S&P SmallCap 600 Index, the Dow Jones
Equity Market Index and two peer group indices selected by the Company, for the
period between the Company's initial public offering on June 27, 1996 and
December 31, 1998.
The peer group previously selected by the Company was comprised of the
following companies: AAR Corp., Aviall, Inc., Banner Aerospace, Inc., Kellstrom
Industries, Inc., Triumph Group, Inc. and United Corps, Ltd. (the "Old Peer
Group"). The members of the new peer group selected by the Company are the
following companies: AAR Corp., Aviall, Inc., B.F. Goodrich Company, Kellstrom
Industries, Inc. and Triumph Group, Inc. (the "New Peer Group"). The members of
the New Peer Group were selected to reflect the Company's 1998 acquisition of
maintenance, repair and overhaul operations.
These indices relate only to stock prices during the period covered by
the graph; they do not purport to afford direct comparison of the business or
financial performance of the companies comprising such indices with the Company
nor with each other.
Aviation Sales Co (AVS)
CUMULATIVE TOTAL RETURN
------------------------------------
6/27/96 12/96 12/97 12/98
AVIATION SALES COMPANY 100.00 107.89 198.03 213.82
NEW PEER GROUP 100.00 114.90 131.57 119.55
OLD PEER GROUP 100.00 124.92 164.34 152.88
S & P 500 100.00 112.11 149.51 192.24
S & P MIDCAP 400 100.00 107.51 142.18 162.70
S & P SMALLCAP 600 100.00 104.80 131.62 135.21
DOW JONES EQUITY MARKET 100.00 112.53 149.64 192.10
11
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BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The compensation committee of the Board of Directors (the "Compensation
Committee") is responsible for making recommendations to the Board of Directors
concerning executive compensation, including base salaries, bonuses and the
bases for their award, stock option plans and other benefits. Each of the
members of the Compensation Committee is an independent outside director of the
Company.
In determining compensation for the Company's Chief Executive Officer
and senior executive officers, the Compensation Committee has generally
considered the overall performance of the Company during the prior fiscal year,
the individual executive officer's contribution to the achieving of operating
goals and business objectives and levels of compensation of companies similar in
size and development to the Company.
It is the Compensation Committee's view that the Chief Executive
Officer and the senior executives' interests should complement those of
stockholders. Accordingly, a substantial portion of the Chief Executive Officer
and the senior executives' compensation above a base salary is intended to be
provided through bonuses tied to certain indicators of Company performance and
through the grant of stock options, thus creating incentives for the Chief
Executive Officer and executives to achieve long-term Company objectives and
increase stockholder value.
COMPENSATION COMMITTEE
Robert Alpert
Sam Humphreys
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the past fiscal year, none of the Company's present or former
officers or employees, nor any of the former officers of the Company's
subsidiaries, served as a member of the compensation committee of the Company's
Board of Directors. During the past fiscal year, none of the Company's directors
or executive officers served as a member of the compensation committee or
similar committee of another entity, one of whose executive officers served on
the Company's Board, served as a director of another entity, one of whose
executive officers served on the Company's Board, or served as a member of the
compensation committee or similar committee of any other entity, one of whose
executive officers served as a director of the Company.
COMPLIANCE WITH SECTION 16(A)
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3(d) under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), during the Company's fiscal year
ended December 31, 1998 and any Forms 5 and amendments thereto furnished to the
Company with respect to its most recent fiscal year, and any written
representations referred to in subparagraph (b)(2)(i) of Item 405 of Regulation
S-K, except as set forth below, no person who at any time during the fiscal year
ended December 31, 1998 was a director, officer or, to the knowledge of the
Company, a beneficial owner of more than 10% of any class of equity securities
of the Company registered pursuant to Section 12 of the Exchange Act failed to
file on a timely basis, as disclosed in Forms 3, 4 and 5, reports required by
Section 16(a) of the Exchange Act during the fiscal year ended December 31,
1998. The Company has been advised that (i) Benito Quevedo was late in filing a
Form 3 and four Form 4s, (ii) each of Gary Eakins, Richard Hutchinson, Garlan
Braithwaite and Philip B. Schwartz was late in filing a Form 3, and (iii)
William H. Alderman was late in filing a Form 5.
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VOTING SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
As of the Record Date, the Company has 15,011,925 shares of Common
Stock outstanding. Additionally, the Company has outstanding stock options to
purchase an aggregate of 1,948,375 shares (including options outstanding under
the Plans), of which 676,166 are presently exercisable.
The following table sets forth, as of the Record Date, certain
information regarding the Common Stock, owned of record or beneficially by (i)
each person who owns beneficially more than 5% of the outstanding Common Stock;
(ii) each of the Company's directors and named executive officers; and (iii) all
directors and executive officers as a group. The address for each beneficial
owner is c/o the Company, 6905 N.W. 25th Street, Miami, Florida.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)
--------------------------
NAME NUMBER APPROXIMATE
- -------------------------------------------------------------------------- ----------- ------------
<S> <C> <C>
Robert Alpert(2)(3) ...................................................... 2,462,000 16.4%
George F. Baker, III(4) .................................................. 1,055,776 7.0%
Richard B. Nye(5) ........................................................ 973,774 6.5%
Dale S. Baker(6) ......................................................... 356,667 2.4%
Harold M. Woody(7) ....................................................... 245,000 1.6%
Sam Humphreys(8) ......................................................... 25,000 *
Philip B. Schwartz(9) .................................................... 21,400 *
Michael A. Saso(10) ...................................................... 55,000 *
James D. Innella(11) ..................................................... 53,685 *
All directors and executive officers as a group (13 persons)(12) ......... 3,414,449 22.3%
</TABLE>
- ----------------
* Less than one percent
(1) Unless otherwise indicated, each person named in the table has the sole
voting and investment power with respect to the shares beneficially owned.
(2) Shares are primarily owned of record by corporate entities controlled by
Mr. Alpert.
(3) Includes vested options to purchase 25,000 shares at prices ranging from
$19.00 to $39.50 per share.
(4) George F. Baker, III may be deemed to indirectly own 675,995 shares of
Common Stock directly owned by Cambridge Capital Fund, L.P. ("Cambridge
Capital") of which Mr. Baker is a managing general partner and 297,779
shares of Common Stock directly owned by Baker Nye, L.P. ("Baker Nye") of
which Mr. Baker is a managing general partner. Also includes vested
options to purchase 82,002 shares at prices ranging from $12.52 to $37.97
per share.
(5) Richard B. Nye may be deemed to indirectly own 675,995 shares of Common
Stock directly owned by Cambridge Capital of which Mr. Nye is a managing
general partner and 297,779 shares of Common Stock directly owned by Baker
Nye of which Mr. Nye is a managing general partner.
(6) Includes vested options to purchase 51,667 shares at prices ranging from
$19.00 to $39.50 per share.
(7) Includes vested options to purchase 45,000 shares at prices ranging from
$19.00 to $39.50 per share.
(8) Vested options to purchase 25,000 shares at prices ranging from $19.00 to
$39.50 per share.
(9) Includes vested options to purchase 20,000 shares at prices ranging from
$37.00 to $39.50 per share.
(10) Includes vested options to purchase 20,000 shares at prices ranging from
$24.50 to $25.25 per share.
(11) Includes vested options to purchase 43,333 shares at prices ranging from
$19.00 to $35.25 per share.
(12) Includes vested options to purchase 333,758 shares at prices ranging from
$19.00 to $39.50 per share.
CERTAIN TRANSACTIONS
As of December 2, 1994, the Company entered into a 20-year lease with
Aviation Properties, a Delaware general partnership ("Aviation Properties"),
pursuant to which the Company leases its corporate headquarters and warehouse in
Miami, Florida (the "Miami Property"). The Company makes annual payments under
such lease in the amount of approximately $892,990. The sole partners
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<PAGE>
of Aviation Properties are (a) AVAC Corporation ("AVAC") and (b) JT Aviation
Partners ("J/T"). The sole stockholder and president of AVAC is Robert Alpert,
a principal stockholder and director of the Company.
In connection with Aviation Properties' purchase of the Miami Property,
the Company and Aviation Properties entered into a loan agreement (the "Loan
Agreement") whereby the Company made a $2,465,519 loan to Aviation Properties,
which loan bears interest at 8% per annum, with principal and interest due in a
single payment on December 2, 2004.
As of December 2, 1994, the Company entered into a six-year lease with
Aviation Properties of Texas, a Delaware general partnership ("AVTEX"), pursuant
to which the Company leased a warehouse in Pearland, Texas. The Company made
annual payments under such lease in the amount of $114,468. The sole partners of
AVTEX were AVAC and J/T. In March 1998, Aviation Sales Distribution Services
Company ("ASDS"), a wholly-owned subsidiary of the Company, acquired the
Pearland Property from AVTEX in exchange for (i) ASDS's cancellation of all
outstanding principal balance and unpaid accrued interest on a promissory note
of AVTEX held by ASDS in the principal amount of $434,244 and (ii) ASDS's
assumption of indebtedness in the principal amount of $1,128,855 which was
secured by a deed of trust in favor of a third party.
In July 1998, the Company entered into an approximately 19 month lease
for the 30,000 square foot office and manufacturing facility in Miami, Florida
used by its subsidiary Caribe Aviation, Inc. (the "Caribe Facility Lease"). The
lessor under the Caribe Facility Lease is Ben Quevedo, No. 1, Ltd., a limited
partnership controlled by Benito Quevedo (the "Quevedo Partnership"), an
executive officer of the Company. The Company makes monthly payments to the
lessor under the Caribe Facility Lease of approximately $21,515 in rent and
$2,500 in pass through operating costs.
The Company believes the terms of the Loan Agreement, the terms of the
leases with Aviation Properties, AVTEX and the Quevedo Partnership and the terms
of the purchase of the Pearland Property are no less favorable than could be
obtained from an unaffiliated third party.
Mr. Schwartz is a shareholder in Akerman, Senterfitt & Eidson, P.A.,
which has in the past and continues to perform legal services for the Company.
The fees paid by the Company to Akerman, Senterfitt & Eidson, P.A. for legal
services rendered are no greater than those that would be charged to the Company
by an unrelated third party law firm.
PROPOSAL 1. ELECTION OF DIRECTORS
At the Annual Meeting, three directors will be elected to serve on the
Company's Board of Directors. One director, Harold W. Woody, will be elected to
serve until the 2000 Annual Meeting of Stockholders; a second director, Philip
B. Schwartz, will be elected to serve until the 2001 Annual Meeting of
Stockholders, and a third director, Dale S. Baker will be elected to serve until
the 2002 Annual Meeting of Stockholders (or until their respective successors
are elected and qualified). It is intended that proxies will be voted for each
of these nominees. Brief biographies of each of the nominees for director are
set forth under "Board of Directors" above.
The affirmative vote of stockholders holding a majority of the
Company's issued and outstanding shares of Common Stock in attendance at the
meeting, either in person or by proxy, is required to approve this proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THOSE PERSONS
NOMINATED FOR ELECTION TO THE BOARD OF DIRECTORS.
PROPOSAL 2. APPROVAL OF AMENDMENT TO THE 1996 STOCK OPTION PLAN
The Board of Directors recommends that the 1996 Plan be amended to
increase the aggregate number of shares of Common Stock subject to issuance
under the plan to the greater of 2,250,000
14
<PAGE>
shares or 15% of the Company's outstanding shares. The additional shares will
be used for the purposes set forth in the 1996 Plan; that is to enable the
recruitment and retention of executive personnel, key employees, consultants
and advisors upon whose judgment, initiative and effort the Company is largely
dependent and to provide additional incentive by permitting such individuals to
participate in the ownership of the Company. See "Stock Option Plans" above for
a description of the terms of the 1996 Plan. If the stockholders fail to
approve such increase in the number of shares of Common Stock subject to
issuance under the 1996 Plan, there will be no effect on either the outstanding
options or the Company's ability to issue up to an aggregate of the greater of
650,000 shares or 8% of the Company's outstanding shares. The proposed text of
the amendment to the 1996 Plan is attached hereto as APPENDIX A.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THIS PROPOSAL.
PROPOSAL 3. RATIFICATION OF AUDITORS
The Board of Directors has approved the Company's engagement of the
firm of Arthur Andersen LLP as the Company's independent auditors. Arthur
Andersen LLP has served as the Company's independent auditors since the
organization of the Company, and is familiar with the Company's business and
management. The Board of Directors believes that Arthur Andersen LLP has the
personnel, professional qualifications and independence necessary to act as the
Company's independent auditors.
Representatives of Arthur Andersen LLP are expected to appear at the
Annual Meeting to make a statement, if they wish to do so, and to be available
to answer appropriate questions from stockholders at that time.
Although stockholder approval of the Company's auditors is not
required, the Board of Directors is submitting such appointment to a vote of the
Company's stockholders. Approval of this proposal will require the affirmative
vote of a majority of the Company's issued and outstanding shares of Common
Stock in attendance at the meeting, voting in person or by proxy. In the event
this proposal is not approved, management will reconsider its selection of
Arthur Andersen LLP as independent auditors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THIS PROPOSAL.
15
<PAGE>
OTHER MATTERS
The Board of Directors is not aware of any other business that may come
before the meeting. However, if additional matters properly come before the
meeting, proxies will be voted at the discretion of the proxy-holders.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 2000 Annual
Meeting of Stockholders of the Company must be received by the Company not later
than March 31, 2000 at its principal executive offices, 6905 N.W. 25th Street,
Miami, Florida 33122, Attention: Corporate Secretary, for inclusion in the proxy
statement and proxy relating to the 2000 Annual Meeting of Stockholders.
ADDITIONAL INFORMATION
In June 1999, the Company delivered its Annual Report to its
stockholders. The Company will furnish without charge to any stockholder
submitting a written request, the Company's 1998 Annual Report, as well as the
Company's 1998 Annual Report on Form 10-K, as amended, as filed with the
Securities and Exchange Commission, including the financial statements and
schedules thereto. Such written requests should be directed to the Company,
Attention: Corporate Secretary, at the address set forth above.
BY ORDER OF THE BOARD OF DIRECTORS
Dale S. Baker, Chairman of the Board
October 15, 1999
Miami, Florida
16
<PAGE>
APPENDIX A
AMENDMENT NO. 1 TO THE
AVIATION SALES COMPANY 1996 STOCK OPTION PLAN
WHEREAS, Aviation Sales Company, a Delaware corporation (the "Company")
adopted and approved the Company's 1996 Stock Option Plan (the "Plan");
WHEREAS, the Plan provides for the total number of shares of Common
Stock of the Company, $.001 par value per share, that may be subject to options
granted under the Plan to be the greater of 650,000 shares or 8% of the number
of shares of the Company's common stock which are then outstanding;
WHEREAS, the Company reserved the right in the Plan to amend it; and
WHEREAS, the Company wishes to amend the Plan.
NOW, THEREFORE, the Plan is hereby amended and modified effective
November 19, 1999 as follows:
1. The first paragraph of Section 2 of the Plan is amended to read as
follows:
"The total number of shares of Common Stock of the Company, $.001
par value per share, that may be subject to Options granted under
the Plan shall be the greater of 2,250,000 shares or 15% of the
number of shares of the Company's Common Stock which are then
outstanding, in the aggregate, subject to adjustment as provided in
Paragraph 8 hereunder. The Company shall at all times while the
Plan is in force reserve such number of shares of Common Stock as
will be sufficient to satisfy the requirement of outstanding
Options granted under the Plan, except as otherwise provided below.
In the event any Option granted under the Plan shall expire or
terminate for any reason without having been exercised in full or
shall cease for any reason to be exercisable in whole or in part,
the unpurchased shares subject thereto shall again be available for
the granting of Options under the Plan. "
IN WITNESS WHEREOF, the Company has caused this Amendment No. 1 to the
Plan to be duly executed on its behalf, effective as specified herein.
Aviation Sales Company
Date:____________________________ By:_________________________________
Dale S. Baker, President
A-1
<PAGE>
AVIATION SALES COMPANY
6905 N.W. 25TH STREET
MIAMI, FLORIDA 33122
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Dale S. Baker and Philip B. Schwartz,
and each of them, with full power of substitution, proxies of the undersigned,
to attend and vote all the shares of Common Stock, $0.001 par value per share,
of Aviation Sales Company, a Delaware corporation (the "Company") which the
undersigned would be entitled to vote at the Annual Meeting of Stockholders to
be held at the Doral Golf Resort and Spa, 4400 N.W. 87th Avenue, Miami, Florida,
at 10:00 a.m., local time, on November 19, 1999, or any adjournment thereof,
according to the number of votes the undersigned would be entitled to vote if
personally present upon the matters referred to in this proxy.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE PROPOSALS.
1. PROPOSAL 1--Election of Directors.
To elect the following persons as Directors of the Company:
Dale S. Baker Harold M. Woody Philip B. Schwartz
[ ] FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY
except as indicated to vote for all nominees
(INSTRUCTION: To withhold authority for an individual nominee, strike a line
through that nominee's name in the list above.)
2. PROPOSAL 2--To approve an amendment of the 1996 Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. PROPOSAL 3--To ratify the appointment of Arthur Andersen LLP as Independent
Auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. PROPOSAL 4--To transact such other business as may properly come before the
meeting.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
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 proposals as set forth herein.
The undersigned acknowledges receipt of Notice of Annual Meeting of
Stockholders dated October 15, 1999, and the accompanying Proxy Statement.
Date:_____________, 1999.
_________________________
Signature
_________________________
Name(s) (typed or printed)
_________________________
Address(es)
Please sign exactly as name
appears on this Proxy. When
shares are held by joint
tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or
guardian, please give full title
as such. If a corporation,
please sign in full corporate
name by the President or other
authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED.
