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Section 240.14a-101 Schedule 14A.
Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
AUTOBOND ACCEPTANCE CORPORATION
.................................................................
(Name of Registrant as Specified In Its Charter)
.................................................................
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction
applies:
............................................................
(2) Aggregate number of securities to which transaction
applies:
.......................................................
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the amount
on which the filing fee is calculated and state how it was
determined):
.......................................................
(4) Proposed maximum aggregate value of transaction:
.......................................................
(5) Total fee paid:
.......................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
.......................................................
(2) Form, Schedule or Registration Statement No.:
.......................................................
(3) Filing Party:
.......................................................
(4) Date Filed:
.......................................................
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AUTOBOND ACCEPTANCE CORPORATION
100 CONGRESS AVENUE
AUSTIN, TX 78701
(512) 435-7000
--------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, MAY 11, 1999
------------------
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders
of AUTOBOND ACCEPTANCE CORPORATION (the "Company"), which will be held at the
offices of the Company at 100 Congress Avenue, Austin, Texas 78701 on Tuesday,
May 11, 1999, at 10:00 a.m. local time. The meeting is to be held for the
following purposes:
1. To elect six directors, each for a term of one year or until their
respective successors are elected and qualified; and
2. To ratify the appointment by the Board of Directors of Deloitte &
Touche L.L.P. as independent accountants for the 1999 calendar year; and
3. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
These items are fully discussed in the following pages, which will be
made part of this Notice. Only shareholders of record on the books of the
Company at the close of business on April 20, 1999 will be entitled to vote at
the meeting. The transfer books of the Company will not be closed. A list of
shareholders entitled to vote will be available for inspection at the offices of
the Company at 100 Congress Avenue, Austin, Texas 78701, for 10 days prior to
the Annual Meeting.
Shareholders are requested to sign, date and return the enclosed proxy
as soon as possible. A return envelope which requires no postage if mailed in
the United States is enclosed for your convenience. Shareholders who execute
proxies retain the right to revoke them at any time prior to the voting thereof
by filing written notice of such revocation with the Secretary of the Company,
by submission of a duly executed proxy bearing a later date or by voting in
person at the Annual Meeting of Shareholders. Attendance at the Annual Meeting
will not in and of itself constitute revocation of a proxy. Any written notice
revoking a proxy should be sent to Secretary, AutoBond Acceptance Corporation,
100 Congress Avenue, Austin, Texas 78701.
By Order of the Board of Directors
John S. Winsauer
Secretary
Austin, Texas
April 26, 1999
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AUTOBOND ACCEPTANCE CORPORATION
100 CONGRESS AVENUE
AUSTIN, TX 78701
(512) 435-7000
--------------------
PROXY STATEMENT
--------------------
1999 ANNUAL MEETING OF SHAREHOLDERS
The enclosed Proxy is solicited by the Board of Directors of AutoBond
Acceptance Corporation (the "Company") for use in voting at the Annual Meeting
of Shareholders to be held at the offices of the Company at 100 Congress Avenue,
Austin, Texas 78701, on May 11, 1999, at 10:00 a.m. local time, and at any
postponement or adjournment thereof, for the purposes set forth in the attached
notice.
The principal executive offices of the Company are located at 100
Congress Avenue, Austin, Texas 78701. The approximate date on which this Proxy
Statement and the accompanying form of Proxy will first be sent or given to the
Company's shareholders is April 26, 1999.
PROXIES AND REVOCABILITY OF PROXIES
The persons named in the enclosed form of Proxy will vote the shares
for which they are appointed in accordance with the directions of the
shareholders appointing them. In the absence of such directions, such shares
will be voted FOR proposals l and 2 listed below and, in the best judgment of
the persons named in the enclosed proxy, will be voted on any other matters that
may come before the meeting. Any shareholder who executes a proxy has the power
to revoke the same at any time before it is voted by filing written notice of
such revocation with the Secretary of the Company, by submission of a duly
executed proxy bearing a later date or by voting in person at the Annual Meeting
of Shareholders. Attendance at the Annual Meeting will not in and of itself
constitute revocation of a proxy. Any written notice revoking a Proxy should be
sent to Secretary, AutoBond Acceptance Corporation, 100 Congress Avenue, Austin,
Texas 78701. A return envelope which requires no postage if mailed in the United
States is enclosed for your convenience.
VOTING SECURITIES AND RECORD DATE
Only holders of shares ("Shares") of Common Stock, no par value per
share ("Common Stock"), of record at the close of business on April 20, 1999 are
entitled to vote at the meeting. On the record date there were outstanding
6,531,311 Shares. Each outstanding Share is entitled to one vote upon all
matters to be acted upon at the meeting. The holders of a majority of the issued
and outstanding Shares, present in person or represented by proxy, shall
constitute a quorum.
The affirmative vote of a majority of the votes cast by all
shareholders entitled to vote thereon is required to elect each of the directors
(Proposal No. 1). The affirmative vote of a majority of the votes cast by all
shareholders entitled to vote thereon is required to ratify the appointment by
the Board of Directors of the independent auditors (Proposal No. 2). The
affirmative vote of a majority of the votes cast by all shareholders entitled to
vote thereon is required to act upon any other matter as may properly come
before the meeting or any adjournment thereof. Both abstentions and proxy
holders with authority to vote on at least one matter scheduled to come before
the meeting are counted as "present" for the purposes of determining whether
there is a quorum for the meeting. Abstentions have the effect of a negative
vote on proposals requiring the approval of a majority of the Common Stock.
BENEFICIAL OWNERSHIP OF COMMON SHARES
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock as of April 23, 1999 by (i)
each person who is known by the Company to own beneficially more than 5% of its
outstanding Common Stock, (ii) each director and nominee for director, (iii)
each named executive officer, and (iv) all executive officers and directors as a
group.
<PAGE>
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<TABLE>
<CAPTION>
COMMON STOCK
------------------------------------------------------
AMOUNT OF PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OWNED
------------------------------------ -------------------- ----------
<S> <C> <C>
William O. Winsauer..................................................... 3,690,062(1) 56.50%
AutoBond Acceptance Corporation
100 Congress Avenue
Austin, Texas 78701
John S. Winsauer........................................................ 1,240,688(3) 19.00%
AutoBond Acceptance Corporation
100 Congress Avenue
Austin, Texas 78701
Adrian Katz............................................................. 632,083(3) 8.94%
AutoBond Acceptance Corporation
100 Congress Avenue
Austin, Texas 78701
Thomas I. Blinten....................................................... 38,900(4) *
58 Tomac Avenue
Old Greenwich, Connecticut 06870
Stuart A. Jones......................................................... 7,000(5) *
Stuart A. Jones Finance and Investments
200 Expressway Tower
6116 North Central Expressway
Dallas, Texas 75206
Robert A. Shuey III..................................................... 2,000(6) *
Institutional Equities
8214 Westchester, Suite 500
Dallas, Texas 75225
Manuel A. Gonzalez...................................................... 86,833(7) *
AutoBond Acceptance Corporation
100 Congress Avenue
Austin, Texas 78701
Jeremy Blatt............................................................ 40,000(8) *
AutoBond Acceptance Corporation
100 Congress Avenue
Austin, Texas 78701
Total (all executive officers and directors as a group)......... 5,689,233 87.11%
========= ======
Dynex Capital, Inc...................................................... 673,100(9) 10.30%
10900 Nuckols Road, Third Floor
Glen Allen, Virginia 23060
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
* Less than 1%.
(1) Includes 40,000 shares that Mr. William O. Winsauer has the right to acquire
pursuant to the exercise of options.
(2) Includes 20,000 shares that Mr. John S. Winsauer has the right to acquire
pursuant to the exercise of options.
(3) Includes 68,333 shares that Mr. Katz has the right to acquire pursuant to
the exercise of options.
(4) Includes 3,000 shares that Mr. Blinten has the right to acquire pursuant to
the exercise of options.
(5) Includes 3,000 shares that Mr. Jones has the right to acquire pursuant to
the exercise of options.
(6) Includes 3,000 shares that Mr. Shuey has the right to acquire pursuant to
the exercise of options.
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(7) Includes 86,333 shares that Mr. Gonzalez has the right to acquire pursuant
to the exercise of options.
(8) Includes 40,000 shares that Mr. Blatt has the right to acquire pursuant to
the exercise of options.
(9) Includes 500,000 shares deemed beneficially owned pursuant to the right to
acquire such shares upon the conversion of the Company's $3,000,000 12%
Convertible Senior Notes due 2003 (which right expires on May 31, 1999).
Excludes 5,475,500 shares issuable upon exercise of options granted under
the Option Agreement (as defined below) to Dynex Holding, Inc., which option
expired in February 1999. See "Change in Control Arrangements" below.
CHANGE IN CONTROL ARRANGEMENTS
On June 9, 1998, William O. Winsauer, Adrian Katz and John S. Winsauer
(collectively, the "Shareholders") entered into a Stock Option Agreement (the
"Option Agreement") with Dynex Holding, Inc. ("Dynex Holding"), an affiliate of
Dynex Capital, Inc. ("Dynex") wherein the Shareholders granted to Dynex Holding
an option (the "Option") to purchase all of the shares of the Company's common
stock owned by the Shareholders (approximately 85% of the Company's current
outstanding common stock) at a price of $6.00 per share, payable in Dynex
preferred stock. On January 26, 1999, Dynex notified Company that "[Dynex
Holding] intends to acquire 5,474,500 shares of Common Stock of AutoBond which
will represent all securities of AutoBond owned by [Dynex Holding] subsequent to
the acquisition." Concurrently, Dynex Holding filed a Notification and Report
Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the
"Hart-Scott filing"). The Hart-Scott filing contained a description of the Stock
Option and included an affidavit wherein the President of Dynex swore to the
Federal Trade Commission that "[Dynex Holding] intends, in good faith, to make
the acquisition referred to in the attached notice." Notwithstanding such stated
intention, in February 1999, Dynex breached its obligations to fund under the
Credit Agreement, dated June 9, 1998 (the "Credit Agreement"), among Dynex, the
Company and AutoBond Master Funding Corporation V. Such breach and purported
termination of fundings by Dynex under the Credit Agreement constituted an
expiration of Dynex Holding's option under the Option Agreement.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
At the meeting, six (6) Directors will be elected by the shareholders
to serve until the next annual meeting or until their successors are elected and
qualified. The accompanying form of Proxy will be voted for the election as
Directors of the six persons named below, unless the Proxy contains instructions
to withhold a vote. Proxies cannot be voted for a greater number of persons than
the number of nominees named in the Proxy Statement. Although the Company's
by-laws currently fix the number of directors at seven, the Company has
determined not to nominate an additional director. Management has no reason to
believe that any of the nominees set forth below will not be a candidate or will
be unable to serve. However, in the event that any of the nominees should become
unable or unwilling to serve as a Director, the Proxy will be voted for the
election of such person or persons as shall be designated by the Directors.
WILLIAM O. WINSAUER, director nominee.
Mr. Winsauer, age 39, has been Chairman of the Board of Directors and
Chief Executive Officer of the Company since its formation in 1993. Mr. Winsauer
has been involved in arranging and developing various sources of financing for
subprime finance contracts since 1989. Mr. Winsauer was the founder of AutoBond,
Inc. ("ABI") in 1989 and served full time as its President and sole shareholder
from 1989 through 1993, and remains its President and sole shareholder to date.
ABI has no material current operations other than to manage its and Mr.
Winsauer's investments in securitizations sponsored by Mr. Winsauer. In the late
1980s, Mr. Winsauer began selling whole loan packages of contracts originated by
the Gillman Companies, a large dealership group based in Houston, Texas and
worked with his brother, John S. Winsauer, in certain of the transactions placed
through The Westcap Corporation in 1991 and 1992. Mr. Winsauer was among the
first individuals to be involved in the structuring and marketing of
securitization transactions involving subprime automobile contracts.
ADRIAN KATZ, director nominee.
Mr. Katz, age 34, joined the Company in November 1995 and was elected
Vice Chairman of the Board of Directors and appointed Chief Operating Officer in
December 1995. Mr. Katz also has served as the Company's Chief Financial Officer
since May 1998. From February 1995 to November 1995, he was employed as a
managing director
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at Smith Barney, Inc. (a broker/dealer), where he was responsible for
structuring asset-backed, commercial and residential mortgage-backed securities.
From 1989 through 1994, Mr. Katz was employed by Prudential Securities
Incorporated (a broker/dealer), where he was appointed a managing director in
1992 and where he served as a co-head of the Mortgage and Asset Capital Division
with corresponding sales, trading, banking and research management
responsibilities. From 1985 to 1989, Mr. Katz worked for The First Boston
Corporation, developing software and managing the structuring of new
securitizations. Mr. Katz has been involved in the sale and financing through
securitization of consumer assets since 1985.
JOHN S. WINSAUER, director nominee.
Mr. Winsauer, age 36, has served as Secretary and a Director of the
Company since October 1995. In addition, Mr. Winsauer has been a shareholder of
the Company since June 1993. Mr. Winsauer's primary responsibilities have
included the development and implementation of the Company's computer and
communications systems and, since January 1997, the supervision of the Company's
marketing efforts with automobile dealers. From January 1993 until August 1996,
Mr. Winsauer was employed by Amherst Securities Group Inc. (a broker/dealer
previously known as USArbour Financial) as a Senior Vice President, prior to
which he served as a Senior Vice President of The Westcap Corporation (a
broker/dealer) from April 1989 to January 1993. From June 1989 through August
1992, in his position as Senior Vice President with The Westcap Corporation, Mr.
Winsauer participated in the successful marketing of whole-loan packages of
finance contracts placed by the Gillman Companies.
STUART A. JONES, director nominee.
From March 1986 to the present, Mr. Jones, age 44, has been
self-employed as head of Stuart A. Jones Finance and Investments, Dallas, Texas,
a privately-owned consultancy specializing in investment banking and real estate
financing. From August 1988 to February 1989, Mr. Jones served as Deputy
Director for the Assets, Operations and Liquidations Division, Federal Saving &
Loan Insurance Corporation, Washington, D.C. From January 1990 to January 1994,
Mr. Jones also served as Counsel to the Brock Group, Ltd., Washington, D.C., an
international trade and investment strategies consulting firm, where he
represented clients in various real estate, energy and environmental matters.
Mr. Jones is a member of the Texas Bar Association. Mr. Jones has been a
Director of the Company since 1996.
THOMAS I. BLINTEN, director nominee.
Currently chairman and chief executive officer of Caesar Petroleum
Systems, LLC, a software provider and president of WORLDO.com, LLC, an internet
content provider. From November 1995 to September 1997, Mr. Blinten, age 41, was
a managing director and executive management committee member of Nomura Capital
Services, Inc., New York, New York, a majority-owned subsidiary of Nomura
Securities Company, responsible for interest rate swap and OTC derivative sales
and trading. From March 1993 to November 1995, Mr. Blinten was a Principal and
management committee member of General Re Financial Products, a wholly-owned
subsidiary of General Re Corporation. From July 1990 through March 1993 he was a
Manager in the Derivative Products department for Kemper Securities, Inc.
Mr. Blinten has been a Director of the Company since 1996.
ROBERT A. SHUEY III, director nominee.
Mr. Shuey, 44, is currently associated with Institutional Equities, an
investment banking firm in Dallas, Texas. In September 1997, Mr. Shuey founded
Tejas Securities Group, Inc., a securities broker/dealer headquartered in
Dallas, Texas, and served as a managing director and Chief Executive Officer
until August 1998. Mr. Shuey was appointed as a director to replace Manuel
Gonzalez in March 1998. From June 1996 to September 1997, Mr. Shuey was a Vice
President, investment banking, at National Securities (a broker/dealer), and
prior to that was associated with various securities broker/dealers. See
"Certain Relationships and Related Transactions".
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE
ELECTION OF THE ABOVE NAMED NOMINEES. PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY IN THEIR PROXIES A
CONTRARY CHOICE.
4
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MANAGEMENT
Set forth below is certain information as of April 23, 1999 for (i) the
members of the present Board of Directors and (ii) the principal officers of the
Company. Directors serve for annual terms. Officers are elected by the Board of
Directors and serve at the discretion of the Board.
<TABLE>
<CAPTION>
NAME AND POSITION AGE FIRST ELECTED DIRECTOR
----------------- --- ----------------------
<S> <C> <C>
William O. Winsauer(1).................................................. 39 1993
Chairman of the Board of Directors and Chief Executive Officer
Adrian Katz............................................................. 34 1995
Vice Chairman of the Board of Directors, Chief Operating Officer
and Chief Financial Officer
John S. Winsauer(1)..................................................... 36 1995
Director and Secretary
Stuart A. Jones......................................................... 43 1996
Director
Robert A. Shuey III..................................................... 44 1998
Director
Thomas I. Blinten....................................................... 41 1996
Director
Manuel A. Gonzalez...................................................... 48 _____ (2)
President
Robert R. Giese......................................................... 59 _____
Vice President, Collections
Brian K. O'Neil......................................................... 28 _____
Vice President, Principal Accounting Officer
Jeremy Blatt............................................................ 35 _____
Vice President, Technology
</TABLE>
- ------------
(1) Messrs. William and John Winsauer are brothers.
(2) Mr. Gonzalez served as a director of the Company from 11/96 until 1/98.
Biographical information concerning the director nominees is set forth
above under the caption "Proposal No. 1 - Election of Directors." Biographical
information concerning the remaining principal officers is set forth below.
MANUEL A. GONZALEZ, President
Effective February 1, 1998, Mr. Gonzalez was appointed President of the
Company. From November 1996 to January 1998, Mr. Gonzalez was an outside
director of the Company. From September 1993 to December 1994. Mr. Gonzalez, age
48, was Executive Vice President of the Company and ABI. From January 1995 to
January 1998, Mr. Gonzalez was Dealer Principal/Owner of NorthPoint Pontiac
Buick GMC, an automobile dealership located in Kingwood, Texas. From March 1991
to January 1995, Mr. Gonzalez was President of Equifirst Financial Services,
Inc., a consulting firm specializing in the automobile dealership industry. From
1988 through 1990, Mr. Gonzalez was Chief Financial Officer for the Gillman
Companies, prior to which he served as a Vice President at First City Bank,
Texas, where he managed the banking relationships of a large number of
automobile dealers.
5
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ROBERT R. GIESE, Vice President, Collections
Mr. Giese joined the Company in April 1994 as Vice
President--Collections. From 1984 to April 1994, he served as Vice President in
Retail Credit Administration with First Interstate Bank of Texas, with
responsibility for controlling the performance of the consumer loan portfolio in
Texas. Mr. Giese has more than 30 years experience in sales, finance and
banking, including management experience coordinating credit underwriting,
collections, asset disposal, centralized loss recovery and loan workout
functions. His experience in sales, credit and collections supports the Company
in its management of delinquency and loss performance.
BRIAN K. O'NEIL, Vice President, Principal Accounting Officer
Mr. O'Neil joined the Company in August 1995 as an Assistant Controller
and became the Company's Principal Accounting Officer in August 1998. From March
1994 to August 1995, Mr. O'Neil worked in the technical support department of
Unilink, Inc., a software manufacturer where he handled various customer support
problems and aided in designing software applications. Mr. O'Neil received a
bachelor's degree in accounting from the University of Texas at Austin in 1993
and is a certified public accountant.
JEREMY BLATT, Vice President, Technology
Mr. Blatt joined the Company as Vice President, Technology in January
1997 and is responsible for the formulation and implementation of software
systems relating to finance contract servicing. Prior to joining the Company,
Mr. Blatt served in technology/operations from July 1996 to October 1996 with
the Clinton Group (a broker/dealer), from June 1995 to July 1996 with Smith
Barney Inc. (a broker/dealer) and from April 1993 to May 1995 with Lehman
Brothers (a broker/dealer). Mr. Blatt is a certified volunteer medical
technician.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The following is a summary of certain transactions to which the Company
was or is a party and in which certain officers, directors or shareholders of
the Company had or have a direct or indirect material interest.
Historically, the Company and ABI, which is wholly-owned by William O.
Winsauer, have provided services for each other on a regular basis. In this
regard, the Company had net advances due from ABI as described below, which
funds were utilized by ABI prior to 1996 to cover expenses incurred in
connection with the management of ABI's investments in securitization trusts.
The Company and ABI entered into a management agreement dated as of January 1,
1996 (the "ABI Management Agreement") which provides for repayment of the
advances made to William O. Winsauer and John S. Winsauer mentioned in the
preceding paragraph, the reimbursement of expenses incurred on behalf of ABI and
for an annual fee payable by ABI to the Company for services rendered by it or
the Company's employees on behalf of ABI. The ABI Management Agreement states
that the Company shall provide the following management services for ABI on an
ongoing basis: (i) day-to-day management of ABI's portfolio of partnership
interests in the securitization trusts sponsored by ABI between 1992 and 1994,
including various monitoring and reporting functions; (ii) certain cash
management services, including the advancing of funds to pay ABI's ordinary
business expenses and (iii) advice as to regulatory compliance. The ABI
Management Agreement also provides that the Company will perform certain
accounting functions on behalf of ABI including (i) maintenance of financial
books and records, (ii) monitoring of cash management functions, (iii)
preparation of financial statements and tax returns and (iv) providing advice in
connection with retention of independent accountants. As compensation for
services rendered thereunder, the ABI Management Agreement provides that ABI
shall pay the Company an annual fee of $50,000, payable quarterly. In addition,
the ABI Management Agreement provides for the quarterly reimbursement of
advances made by the Company of out-of-pocket costs and expenses on behalf of
ABI. Amounts due to the Company under the ABI Management Agreement and certain
other advances for expenses as described above amounted to $204,325 at December
31, 1998. As of July 1, 1998, the Company no longer provides management
services, administrative services or accounting services for ABI.
In connection with the issuance of 1,000,000 shares of the Company's
15% Series A Cumulative Preferred Stock (the "Preferred Stock") on February 20,
1998, Tejas Securities Group, Inc. ("Tejas") acted as the underwriters'
representative. The Chief Executive Officer and Managing Director of Tejas at
the time of such issuance was Robert A. Shuey III, who was appointed as an
outside director of the Company in March 1998 and is a director-nominee. The
underwriters collectively received $900,000 as compensation for such offering
(including the subsequent exercise of
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the overallotment option), of which Tejas received $180,000. In connection with
the Preferred Stock offering, the Company also paid Tejas a non-accountable
expense allowance of 2% of the amount of such offering. To the extent that
Tejas' expenses were ultimately less than the non-accountable expense allowance,
the excess constituted additional compensation to Tejas. In addition, the
Company sold to Tejas, for $100, a representative's warrant (the
"Representative's Warrant") to purchase up to 100,000 shares of the Company's
Common Stock at an exercise price of $7.75 per share. The Representative's
Warrant is exercisable for a period of four years commencing February 20, 1999
and may not be sold, transferred, pledged or hypothecated for a period of one
year from the date of the Preferred Stock offering, except to the officers or
partners of Tejas and dealers participating in the offering and their respective
partners and officers. The Representative's Warrant includes a net exercise
provision permitting the holder, upon consent of the Company, to pay the
exercise price by cancellation of a number of shares with a fair market value
equal to the exercise price of such Representative's Warrant.
On March 30, 1999, the Company and Stuart A. Jones, an outside director
of the Company, entered into a fee agreement (the "Fee Agreement") wherein Mr.
Jones agreed, on a non-exclusive, best efforts basis, to work toward (i) selling
the Company's existing portfolio of finance contracts, (ii) arranging a
warehouse line of credit to fund existing finance contracts and to facilitate
the resumption of origination operations, and (iii) arranging for new equity
capital to be contributed to the Company or a new venture including the Company
or for an outright sale of the Company. In return, the Company agreed to pay Mr.
Jones certain fees, in cash, in the following amounts: (i) 1% of the gross
amount of sale of all or any portion of finance contracts held by the Company as
of March 30, 1999 or originated by the Company thereafter; (ii) 1.5% of the
dollar amount of any new warehouse line of credit if $20,000,000 or less, or 1%
of the dollar amount of any new warehouse line of credit in excess of
$20,000,000; and (iii) 4% of (a) the dollar amount of any new equity contributed
to the Company or a new venture involving the Company, or (b) the gross sale
price of the Company. The Company also agreed to pay Mr. Jones a monthly
retainer equal to $10,000 on each of May 1, 1999, April 1, 1999 and June 1,
1999. Any fees payable under the Fee Agreement will first be reduced by the
amount of any previously paid retainer fees. The Fee Agreement was approved by
the disinterested directors in accordance with Company policy.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers and persons who own more
than 10% of the Company's Common Stock or other equity securities to file with
the Securities and Exchange Commission (the "SEC") initial reports of ownership
and reports of changes in ownership of Common Stock and other equity securities
of the Company on Forms 3, 4 and 5. Officers, directors and 10% shareholders are
required by SEC regulations to furnish the Company with copies of all Forms 3, 4
and 5 they file.
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3 under the Exchange Act during
its most recent fiscal year and Form 5 and amendments thereto furnished to the
Company with respect to its most recent fiscal year, the Company believes that
the following directors and officers failed to file in a timely manner one or
more of their reports required under Section 16(a):
Stuart A. Jones, an outside director of the Company, filed a Form 5
on April 23, 1999 disclosing transactions that occurred on June 1,
1998 and July 20, 1998.
Other than as noted above, the Company believes that during such fiscal year no
other director, officer, beneficial owner of more than ten percent of any class
of equity securities of the Company failed to file on a timely basis, as
disclosed in the above Forms, reports required by Section 16(a) of the Exchange
Act during the most recent fiscal year or prior fiscal years.
COMMITTEES AND MEETINGS OF THE BOARD
During the year ended December 31, 1998, the Board held 4 regular
meetings. The Board has an Audit Committee and a Compensation Committee. During
1998, each of the Audit Committee and the Compensation Committee consisted of
Messrs. Jones, Gonzalez and Blinten. During 1998, the Audit Committee met 2
times. The Audit Committee reviews and reports to the Board with respect to
various auditing and accounting matters, including the nomination of the
Company's independent public accountants, the scope of audit procedures, general
accounting policy matters, the Company's Internal audit function, and the
performance of the Company's independent public accountants. No meetings of the
Compensation Committee were held in 1998. The Compensation Committee is
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responsible for the review and approval of the annual corporate compensation
guidelines, management bonuses, executive officer compensation, and the
potential levels of awards under the Company's 1998 Stock Option Plan (the
"Plan") for the ensuing year. During 1998, all of the directors attended 100% of
the meetings of the Board and committees of which they are members, except for
Robert A. Shuey, who did not attend one of the Company's board meetings.
DIRECTORS' COMPENSATION
Currently, each director who is not employed by the Company receives an
annual retainer of $5,000 plus $500 for each meeting of the Board or any
committee he attends (and reimbursement of out-of-pocket expenses), as well as
for periodic consultations. In addition, each non-employee director received
options under the Company's 1996 Stock Option Plan to purchase 3,000 shares of
the Company's Common Stock.
EXECUTIVE COMPENSATION
The following table sets forth, for the years ended December 31, 1998,
1997 and 1996, the annual and long-term compensation for the Company's highest
paid employees ("named executives"). These were the only employees whose annual
compensation exceeded $100,000 for the fiscal year ended December 31, 1998.
8
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<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------- --------------- -------------- -------------- ------------------ --------------
OTHER
ANNUAL SECURITIES ALL OTHER
NAME AND COMPENS- UNDERLYING COMPENS-
PRINCIPAL POSITION YEAR BASE SALARY BONUS ATION OPTIONS (#) ATION
- ------------------------------------------ ---------------- ----------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
William O. Winsauer.......... 1998 $240,000 $ 18,105 $ 0 0 $0
Chairman of the Board and 1997 240,000 0 16,500 0 0
Chief Executive Officer 1996 160,000(1) 0 0 40,000 0
Adrian Katz.................. 1998 $200,000 $ 0 $ 0 145,000 $0
Vice Chairman of the 1997 150,000 0 0 0 0
Board, Chief Operating 1996 150,186 0 0 20,000 0
Officer and Chief Financial
Officer
John S. Winsauer............. 1998 $120,000 $ 52,850 $ 0 0 $0
Director, Vice President 1997 120,000 27,525 0 0 0
and Secretary 1996 120,000 0 0 0 0
Manuel A. Gonzalez........... 1998 $200,000 $112,500 $17,723 100,000 $0
President 1997 0 0 0 0 0
1996 0 0 0 3,000 0
Jeremy Blatt................. 1998 $100,000 $ 0 $ 5,417 30,000 $0
Vice President, Technology 1997 97,708(2) 0 0 10,000 0
</TABLE>
- ---------
(1) Amount reflects actual payments; on an annualized basis, Mr. William O.
Winsauer's 1996 base salary would have been $240,000.
(2) Amount reflects actual payments; on an annualized basis, Mr. Blatt's 1997
base salary would have been $100,000.
---------------------
Under the Company's compensation structure for fiscal 1999, the highest
paid officers with salaries in excess of $100,000 will be as follows (annual
salary in parentheses): William O. Winsauer ($240,000); Adrian Katz ($200,000);
Manuel A. Gonzalez ($200,000); John S. Winsauer ($120,000); and Jeremy Blatt
($100,000).
9
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<PAGE>
STOCK OPTIONS
<TABLE>
<CAPTION>
STOCK OPTION GRANTS 1998
INDIVIDUAL GRANTS
-------------------------------------------------------------------
% OF TOTAL
NUMBER OF OPTIONS
SECURITIES GRANTED TO
UNDERLYING EMPLOYEES GRANT DATE
OPTIONS IN FISCAL EXERCISE EXPIRATION FAIR
NAME GRANTED YEAR PRICE ($/SH)(1) DATE VALUE ($/SH)
---------------------------------------------------- -------------- ----------------
<S> <C> <C> <C> <C> <C>
Adrian Katz........................... 145,000 52.73% 7.3125 3/31/2008 3.44
Manuel A. Gonzalez.................... 100,000 36.36% 3.75 1/9/2008 1.76
Jeremy Blatt.......................... 10,000 10.91% 3.75 1/9/2008 1.76
10,000 8 6/12/2008 3.76
10,000 4.50 12/7/2008 2.12
</TABLE>
- ---------
(1) The options were granted under the Company's 1996 Stock Option plan, except
for those granted to Mr. Blatt, which were made under the 1998 Stock Option
Plan. The exercise price is the fair market value of the underlying stock on
the date the options were granted. The options vest 1/3 per year at the end
of each of the three years following the date of the grant.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
Messrs. William Winsauer and Katz have entered into employment
agreements with the Company on substantially the following terms:
William O. Winsauer. Mr. Winsauer entered into an employment agreement
with the Company dated May 1, 1996. Under the terms of this agreement, Mr.
Winsauer has agreed to serve as Chief Executive Officer of the Company for a
period of five years and, during such time, to devote his full business time and
attention to the business of the Company. The agreement provides for
compensation of Mr. Winsauer at a base salary of $240,000 per annum, which may
be increased or decreased from time to time in the sole discretion of the Board,
but in no event less than $240,000 per annum. The agreement entitles Mr.
Winsauer to receive the benefits of any cash incentive compensation as may be
granted by the Board to employees, and to participate in any executive bonus or
incentive plan established by the Board from time to time.
The agreement provides Mr. Winsauer with additional benefits including
(i) the right to participate in the Company's medical benefit plan, (ii)
entitlement to benefits under the Company's executive disability insurance
coverage, (iii) a monthly automobile allowance of $1,500 plus fees, maintenance
and insurance, (iv) six weeks paid vacation and (v) all other benefits granted
to full-time executive employees of the Company.
The agreement automatically terminates upon (i) the death of Mr.
Winsauer, (ii) disability of Mr. Winsauer which continues for a period of six
months, following the expiration of such six months, (iii) the termination of
Mr. Winsauer "for cause" (which termination requires the vote of a majority of
the Board) or (iv) the occurrence of the five-year expiration date; provided,
however, that the agreement may be extended for successive one-year intervals
unless either party elects to terminate the agreement in a prior written notice.
Mr. Winsauer may terminate his employment under the agreement for good reason as
set forth below. In the event of Mr. Winsauer's termination for cause, the
agreement provides that the Company shall pay Mr. Winsauer his base salary
through the date of termination and the vested portion of any incentive
compensation plan to which Mr. Winsauer may be entitled.
Mr. Winsauer may terminate his employment under the agreement for "good
reason," including: (i) removal of, or failure to re-elect, Mr. Winsauer as
Chief Executive Officer; (ii) change in scope of responsibilities; (iii)
reduction in salary; (iv) relocation of the Company outside Austin, Texas; (v)
breach by the Company of the agreement; (vi)
10
<PAGE>
<PAGE>
certain changes to the Company's compensation plans; (vii) failure to provide
adequate insurance and pension benefits; (viii) failure to obtain similar
agreement from any successor or parent of the Company; or (ix) termination of
Mr. Winsauer other than by the procedures specified in the agreement.
Other than following a change in control, or upon termination of Mr.
Winsauer in breach of the agreement or termination by Mr. Winsauer for good
reason, the Company must pay Mr. Winsauer: (i) his base salary through the date
of termination; (ii) a severance payment equal to the base salary multiplied by
the number of remaining years under the agreement; and (iii) in the case of
breach by the Company of the agreement, all other damages to which Mr. Winsauer
may be entitled as a result of such breach, including lost benefits under
retirement and incentive plans.
In the event of Mr. Winsauer's termination following a change in
control, the Company is required to pay Mr. Winsauer an amount equal to three
times the sum of (i) his base salary, (ii) his annual management incentive
compensation and (iii) his planned level of annual perquisites. The agreement
also provides for indemnification of Mr. Winsauer for any costs or liability
incurred by Mr. Winsauer in connection with his employment.
Adrian Katz. Mr. Katz entered into an employment agreement with the
Company dated November 15, 1995 and subsequently amended on March 31, 1998 (the
"Agreement"). Under the terms of this Agreement, Mr. Katz has agreed to serve as
Vice Chairman and Chief Operating Officer of the Company through the period
ending November 15, 2000 and, during such time, to devote his full business time
and attention to the business of the Company. The Agreement grants Mr. Katz a
base salary of $200,000 (effective April 1, 1998) per annum, which amount may be
increased from time to time at the sole discretion of the Board. The Agreement
terminates upon the death of Mr. Katz. In the event of any disability of Mr.
Katz which continues for a period of six months, the agreement may be terminated
by the Company at the expiration of such six-month period. The Agreement
automatically terminates upon the discharge of Mr. Katz for cause.
Since May 1998, Mr. Katz has agreed to serve as Chief Financial
Officer. Mr. Katz has agreed not to disclose certain confidential proprietary
information of the Company to unauthorized parties, except as required by law,
and to hold such information for the benefit of the Company. The Agreement
contains standard non-competition covenants whereby Mr. Katz has agreed not to
conduct or solicit business with any competitors or clients of the Company
within certain restricted geographic areas for a period of two years following
the termination of his employment. The restriction also applies to the
solicitation of any current or recent employees of the Company. The restricted
areas include any territory within a 40-mile radius of an automobile dealership
with which the Company has done business during the term of the agreement.
Pursuant to the terms of the Agreement, Mr. Katz received 568,750 shares of the
Company's Common Stock on January 1, 1996, equal to 10% of the Company's
outstanding shares of Common Stock following the issuance of such shares to Mr.
Katz.
Pursuant to the amendment to the Agreement, Katz received 145,000 share
options (at a strike price of $75/16 per share) under the Company's 1996 Stock
Option Plan and will receive 35,000 share options under the 1998 Stock Option
Plan.
Manuel A. Gonzalez. Pursuant to a Consulting and Employment Agreement,
dated as of January 1, 1998 between the Company and Manuel A. Gonzalez, Mr.
Gonzalez agreed to serve as a consultant to the Company until February 1, 1998,
whereupon Mr. Gonzalez agreed to become President of the Company for a period of
three years and, during such time, to devote his full business time and
attention to the business of the Company. The agreement provides for
compensation of Mr. Gonzalez at a base salary of $200,000 per annum, with a one
time signing bonus of $100,000 and additional performance bonuses of up to
$25,000 per quarter, as approved by the Chairman and the Compensation Committee.
In addition, Mr. Gonzalez received options under the 1996 Stock Option Plan to
purchase 100,000 shares of the Company's Common Stock (at an exercise price of
$3.75/share), along with an agreement to grant additional options to purchase
50,000 of the Company's common stock on December 1, 1998 under the 1998 Stock
Option Plan. The agreement entitles Mr. Gonzalez to participate in all employee
benefit plans and arrangements of the Company in the same manner as other
executive officers and to reimbursement for all reasonable expenses for
entertainment and the like incurred by him in the interest of the business of
the Company.
The Agreement automatically terminates upon (i) the death of Mr.
Gonzalez, (ii) the disability of Mr. Gonzalez, which continues for a period of
six months, (iii) "for cause," (iv) at Mr. Gonzalez's option, or (v) at the
Company's option. Upon such termination, the Company is obligated to pay Mr.
Gonzalez his accrued base pay through the date
11
<PAGE>
<PAGE>
of such termination, unless terminated by the Company without cause, whereupon
Mr. Gonzalez would be entitled to his base pay for the remainder of the year in
which such termination occurred.
Pursuant to a separate Severance Agreement, dated as of February 1,
1998, upon the occurrence of a "change in control" the Company must pay Mr.
Gonzalez a lump sum payment equal to the sum of the base pay plus any incentive
pay for that year, plus the Company will arrange to provide, for a period of
twelve months following the termination date, such employee benefits as are
substantially similar to those that Mr. Gonzalez was receiving or entitled to
receive immediately prior to such termination date. Mr. Gonzalez generally is
not required to mitigate payments made under the Severance Agreement.
As with Mr. Katz, Mr. Gonzalez has agreed not to disclose certain
confidential proprietary information of the Company and has agreed to certain
noncompetition covenants whereby he has agreed not to conduct or solicit
business with any competitors of the Company within the State of Texas for a one
year period following the termination of his employment.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
Three of the Company's executive officers, Messrs. William and John
Winsauer and Adrian Katz, participated in the Board's deliberations regarding
executive compensation.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation of the Company's executive officers, including the Chief
Executive Officer, for 1996 was determined by the Board of Directors prior to
the Company's initial public offering, in consultation with the Company's
underwriters. Factors considered were the relative infancy of the Company, its
size and compensation packages made to executives at comparable competitors,
with a view towards fixing cash compensation at prudent, conservative levels.
Approximately 100,000 share options under the Plan were granted to executive
officers upon completion of the Company's initial public offering, as part of he
overall grants of up to 300,000 share options to employees generally. In light
of the large shareholdings of the Company's top three executives, it was
determined to be unnecessary to grant additional incentives-based cash
compensation for these officers.
Fiscal 1998 compensation arrangements were adopted and ratified by
Messrs. Gonzalez, Blinten and Jones, as members of the Compensation Committee.
PERFORMANCE GRAPH
Trading of the Company's Common Stock commenced November 8, 1996 on a
when issued basis. The following graph compares total shareholder returns of the
Company's Common Stock from December 31, 1996 through March 31, 1998 to the CBOE
Russell 2000 Index ("Russell 2000") and to a peer group composite ("Peer
Composite"). The Peer Composite is composed of six publicly traded
companies--AmeriCredit Corp., Arcadia Financial, Ltd., Credit Acceptance Corp.,
First Investors Financial Services, General Acceptance Corp., and Onyx
Acceptance Corp. (the "Peer Companies"). The Peer Companies have been selected
on an industry and line-of business basis.
The graph assumes that the value of the investment in the Company's
Common Stock and in the Russell 2000 and Composite indices was $100 at December
31, 1997 and that all dividends were reinvested. The Company's Common Stock
price on December 31, 1997 (on which the graph is based), was $3.75.
12
<PAGE>
<PAGE>
COMPARISON OF CUMULATIVE TOTAL RETURN AMONG AUTOBOND ACCEPTANCE CORPORATION,
CBOE RUSSELL 2000 AND PEER COMPOSITE
(12/31/97 TO 3/31/99)
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
12/31/97 3/31/99
-------- -------
<S> <C> <C>
AutoBond 100 56.52
Russell 2000 100 90.99
Composite 100 80.47
</TABLE>
Closing price of the Company's Shares on April 19, 1999: $1.50/share.
PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Deloitte & Touche L.L.P. ("Deloitte") has been designated by the Board
of Directors, subject to ratification by the Company's shareholders, to make an
examination of the consolidated balance sheet of the Company as of December 31,
1999 and the related consolidated statement of income and cash flows for the
fiscal year ending December 31, 1999, and for such other purposes incidental
thereto as may be required.
The Company expects that a representative of Deloitte will be present
at the meeting and will be available to respond to appropriate questions from
shareholders. The representative from Deloitte will have an opportunity to make
a statement at the meeting if he so desires.
In their report on the financial statements for the fiscal year ended
December 31, 1998, Deloitte indicated that such statements were prepared
assuming that the Company would continue as a going concern. Deloitte noted that
"the termination of the Company's primary source of funding for its acquisition
of finance contracts, the ability of a lender to accelerate a debt obligation,
the possibility of certain trustees removing the [C]ompany as servicer on
certain transactions, and litigation brought against the [C]ompany by a
preferred stock holder raise substantial doubt about its ability to continue as
a going concern."
13
<PAGE>
<PAGE>
As previously reported by the Company in May 1998, after the Company's
Annual Meeting of Shareholders on May 12, 1998, the Company was notified by its
independent auditors, Coopers & Lybrand LLP ("Coopers"), that Coopers would no
longer serve as the Company's independent public auditors. Thereafter, the
Company's Audit Committee approved Cooper's decision. Coopers' report on the
Company's financial statements included in the Company's 1997 Annual Report on
Form 10-K contained statements emphasizing that the Company's most significant
warehouse facility, which expired on March 31, 1998, had been extended to April
30, 1998 and that the Company was in negotiations with other parties for
additional warehouse and securitization facilities.
There were no disagreements between the Company and Coopers as to
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure with respect to the 1997 audit or any interim period
thereafter. With respect to the 1996 audit, the Company and Coopers did disagree
over the treatment of premiums paid by the Company to procure physical damage
and deficiency balance insurance for certain finance contracts included in
securitization trusts. The additional credit enhancement provided by such
insurance allowed the Company's subsidiary to issue related debt secured by
excess spread cash flows from the trusts, and the Company believed that the
appropriate accounting treatment was to capitalize at least part of the premiums
paid over the expected life of the debt. Coopers disagreed and required the
current expensing of all such premiums. The disagreement was discussed by the
Company's board of directors with Coopers and was resolved to Coopers'
satisfaction, and such premiums have been expensed in the period incurred. The
Company has authorized Coopers to respond fully to the inquiries of Deloitte as
to the nature of any disagreement. During 1996 and prior to the Company's
initial public offering in November 1996, Coopers did advise the Company as to
the Company's need to improve the internal accounting controls necessary to
develop reliable financial statements. In its 1996 and 1997 Reports to
Management, Coopers also advised the Company of certain matters involving the
internal control structure and its operation that Coopers considered to be
"reportable conditions" (defined in accordance with Statement of Auditing
Standards No. 60 ("SAS 60") as "matters coming to the auditor's attention that,
in his judgment, should be communicated . . . because they represent significant
deficiencies in the design or operation of internal control, which could
adversely affect the organization's ability to record, process, summarize, and
report financial data consistent with the assertion of management in the
financial statements."). However, none of the reportable conditions were
believed by Coopers to be material weaknesses under SAS 60, which "is a
reportable condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk
that errors or irregularities in amounts that would be material in relation to
the financial statements being audited may occur and not be detected within a
timely period by employees in the normal course of performing their assigned
functions."
On July 15, 1998, the Company engaged Deloitte as its independent
auditors. The decision to engage Deloitte was made following consideration by
the Board of Directors. Prior to such engagement, neither the Company nor anyone
on its behalf consulted Deloitte regarding: (i) the application of accounting
principles to a specific transaction, either completed or proposed, or the type
of audit opinion that might be rendered on the Company's financial statements;
or (ii) any matter that was either the subject of a disagreement or a reportable
event.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE
RATIFICATION OF DELOITTE & TOUCHE AS THE COMPANY'S INDEPENDENT AUDITORS. PROXIES
SOLICITED BY THE BOARD OF DIRECTORS WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY
IN THEIR PROXIES A CONTRARY CHOICE.
OTHER MATTERS
The management of the Company does not know of any matters other than
those stated in the Proxy Statement which are to be presented for action at the
meeting. If any other matters should properly come before the meeting, it is
intended that proxies in the accompanying form will be voted any such matters in
accordance with the judgment of the persons voting such proxies. Discretionary
authority to vote on such matters is conferred by such proxies upon the persons
voting them.
The Company will bear the cost of preparing, assembling and mailing the
Proxy, Proxy Statement and other material which may be sent to its shareholders
in connection with this solicitation. In addition the solicitation of proxies by
use of the mails, officers and regular employees of the Company may solicit the
return of proxies. The Company may reimburse persons holding stock in their
names or in the names of other nominees for their expenses in sending proxies
and proxy materials to principals. Proxies may be solicited by mail, personal
interview, telephone and facsimile.
14
<PAGE>
<PAGE>
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON BEING SOLICITED
BY THIS PROXY STATEMENT, THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF THE
ANNUAL REPORT OF THE COMPANY ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1998
(AS FILED WITH THE SEC) INCLUDING THE FINANCIAL STATEMENTS AND THE FINANCIAL
STATEMENT SCHEDULES THERETO. ALL SUCH REQUESTS SHOULD BE DIRECTED TO JOHN S.
WINSAUER, SECRETARY, AUTOBOND ACCEPTANCE CORPORATION, 100 CONGRESS AVENUE,
AUSTIN, TEXAS 78701.
SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
All proposals of shareholders intended to be included in the proxy
statement to be presented at the next Annual Meeting of Shareholders must be
received at the Company's executive office in Austin, Texas, no later than
December 28, 1999.
By Order of the Board of Directors
John S. Winsauer
Secretary
Dated: April 26, 1999
15
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<PAGE>
APPENDIX 1
AUTOBOND ACCEPTANCE CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY FOR THE ANNUAL MEETING OF SHAREHOLDERS
MAY 11, 1999
The undersigned hereby constitutes and appoints William O. Winsauer, John
S. Winsauer and Adrian Katz, and each of them, his true and lawful agents and
proxies, with full power of substitution in each, to represent the undersigned
at the Annual Meeting of Shareholders of AUTOBOND ACCEPTANCE CORPORATION (the
'Company') at 100 Congress Avenue, Austin, Texas and at any adjournments
thereof, on all matters coming before said meeting.
1. Election of six (6) directors. Nominees for directors are William O.
Winsauer, Adrian Katz, John S. Winsauer, Robert A. Shuey III, Stuart A.
Jones and Thomas I. Blinten.
2. Ratification of the appointment by the Board of Directors of Deloitte &
Touche L.L.P. as independent auditors.
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE BOXES, SEE
REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO VOTE IN ACCORDANCE
WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS. THE PROXIES CANNOT VOTE YOUR
SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
<PAGE>
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF SHAREHOLDERS
AUTOBOND ACCEPTANCE CORPORATION
MAY 11, 1999
Please Detach and Mail in the Envelope Provided
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
1. ELECTION OF FOR WITHHOLD
DIRECTORS [ ] [ ]
Nominees: William O. Winsauer
Adrian Katz
John S. Winsauer
Robert A. Shuey III
Stuart A. Jones
Thomas I. Blinten
____________________________________________
The Board of Directors recommends a vote FOR
the nominees and FOR proposal 2.
FOR AGAINST ABSTAIN
2. Ratification of Deloitte & Touche L.L.P. [ ] [ ] [ ]
Please check
here if you plan [ ]
to attend the
meeting.
Signature_____________________ Signature_____________________ Dated:_______ 1999
Note: Please date this proxy and sign exactly as your name appears on this
proxy. If 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 president or
other authorized officer. If a partnership, please sign in partnership by
authorized person.
