SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 ss.240.14a-11(c) or ss.240.14a-12
SONOMAWEST HOLDINGS INC
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
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(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 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: N/A
(2) Aggregate number of securities to which transaction applies: N/A
(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): N/A
(4) Proposed maximum aggregate value of transaction: N/A
(5) Total fee paid: N/A
[ ] 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: N/A
(2) Form, Schedule or Registration Statement No.: N/A
(3) Filing Party: N/A
(4) Date Filed: N/A
<PAGE>
SONOMAWEST
HOLDINGS INC
1448 Industrial Avenue o Sebastopol, CA 95472-4848
Ph: 707 824-2548 o Fax: 707 824-2545
www.sonomawestholdings.com
--------------------------
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS AND PROXY STATEMENT
November 9, 2000
---------------------------
To the Shareholders of SonomaWest Holdings, Inc.:
Notice is hereby given that the Annual Meeting of the Shareholders of
SonomaWest Holdings, Inc. (the "Company") will be held on Thursday, November 9,
2000 at 10:00 a.m., in the Russian Hill Room at the Crowne Plaza Union Square
located at 480 Sutter Street, San Francisco, California for the following
purposes:
1. To elect four directors to serve until the 2001 Annual Meeting of
Shareholders or until their respective successors are elected and
qualified.
2. To vote upon a shareholder proposal that the Company declare and pay a
cash dividend.
3. To approve the appointment of Arthur Andersen LLP as independent
auditors for the fiscal year ending June 30, 2001.
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only shareholders of record at the close of business on September 13, 2000
are entitled to notice of and to vote at the meeting and at any continuation or
adjournment thereof.
All shareholders are cordially invited to attend the meeting in person.
However, to ensure your representation at the meeting, we urge you to mark,
sign, date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any shareholder attending
the meeting may vote in person even if such shareholder has returned a proxy.
By Order of the Board of Directors,
Roger S. Mertz
SECRETARY
Sebastopol, California
October 11, 2000
<PAGE>
SONOMAWEST
HOLDINGS INC
1448 Industrial Avenue o Sebastopol, CA 95472-4848
Ph: 707 824-2548 o Fax: 707 824-2545
www.sonomawestholdings.com
--------------------------
PROXY STATEMENT
For Annual Meeting of Shareholders
November 9, 2000, at 10:00 a.m.
INFORMATION CONCERNING VOTING AND SOLICITATION
GENERAL
This Proxy Statement is furnished by the Board of Directors of SonomaWest
Holdings, Inc. (the "Company") to solicit Shareholder Proxies to be voted at the
Annual Meeting of Shareholders to be held on Thursday, November 9, 2000, at
10:00 a.m., local time, or at any adjournment or postponement thereof, for the
purposes set forth herein and in the accompanying Notice of Annual Meeting of
Shareholders. The Annual Meeting will be held in the Russian Hill Room at the
Crowne Plaza Union Square located at 480 Sutter Street, San Francisco,
California.
The mailing of these proxy solicitation materials and the Company's Annual
Report to Shareholders for the year ended June 30, 2000 commenced on or about
October 12, 2000.
VOTING
The Board of Directors has fixed the close of business on September 13,
2000 as the Record Date for the determination of Shareholders entitled to
receive notice of, and to vote at, the Annual Meeting or any adjournment
thereof. At the Record Date, 1,522,350 shares of the Company's common stock were
issued and outstanding, and no shares of any other class of stock were
outstanding.
Each Shareholder on the Record Date will be entitled to one vote for each
share held on all matters to be voted upon at the Annual Meeting, except for the
election of Directors. In the election of Directors, however, Shareholders have
cumulative voting rights, which means that each Shareholder is entitled to a
number of votes equal to the number of his or her shares multiplied by the
number of Directors to be elected (four). A Shareholder may cast all of his or
her votes for a single candidate, or may distribute votes among as many
candidates as he or she may see fit. No Shareholder may cumulate votes for a
candidate, however, unless the name(s) of the candidate(s) have been placed in
nomination prior to the voting and the Shareholder has given notice at the
Meeting, prior to the voting, of the intention to cumulate votes. If one
Shareholder has already given such a notice, all Shareholders may cumulate their
votes for candidates in nomination without further notice.
The inspector of election appointed for the meeting will tabulate all votes
and will separately tabulate affirmative and negative votes, abstentions and
broker non-votes. Abstentions will have the same effect as negative votes.
Broker non-votes are counted towards a quorum, but are not counted for any
purpose in determining whether a matter has been approved. All properly executed
proxies that are not revoked will be voted at the meeting in accordance with the
instructions contained therein.
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REVOCABILITY OF PROXIES
Any person giving a proxy in the form accompanying this statement has the
power to revoke such proxy at any time before it is voted. The proxy may be
revoked by filing with the Secretary of the Company at the Company's principal
executive office a written notice of revocation or a duly executed proxy bearing
a later date, or by filing written notice of revocation with the secretary of
the meeting prior to the voting of the proxy, or by attending the meeting and
voting in person.
SOLICITATION
The Company will bear the entire cost of solicitation, including
preparation, assembly, printing, and mailing of this Proxy Statement, the Proxy
card, and any additional material furnished to Shareholders. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries, and
custodians holding shares in their names which are beneficially owned by others
to forward to such beneficial owners. In addition, the Company may reimburse
such persons for their costs of forwarding the solicitation material to such
beneficial owners. Original solicitation of proxies by mail may be supplemented
by telephone, telegram, or personal solicitation by directors, officers, or
employees of the Company. No additional compensation will be paid for any such
services. Except as described above, the Company does not intend to solicit
proxies other than by mail.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Proposals of Shareholders that are intended to be presented at the
Company's 2001 Annual Meeting of Shareholders must be received by the Company no
later than June 14, 2001 in order to be included in the proxy statement and
proxy relating to that meeting.
PROPOSAL 1
ELECTION OF DIRECTORS
At the Annual Meeting, four Directors are to be elected by the Shareholders
to serve until the next Annual Meeting or until the election and qualification
of their successors. The Board's proxy holders (named on the enclosed Proxy
card) intend to vote all shares for which Proxies are granted to elect the four
nominees selected by the Company's Board of Directors and intend to vote such
shares cumulatively if necessary to elect some or all of such nominees.
If any of the Board's nominees refuses or is unable to serve as a Director
(which is not now anticipated), the Board's proxy holders intend to nominate and
vote for such other person(s) as they believe will best serve the interests of
the Company. Any Shareholder may nominate a candidate for Director from the
floor at the Meeting. Such nominee must consent to serve, if elected, prior to
voting on his or her name. The Board of Directors has no reason to believe that
any substitute nominee or nominees will be required.
The four nominees for Director who receive the most affirmative votes will
be elected Directors. Votes withheld shall have no effect on the election
result, though applicable securities laws and regulations may require that the
number of such votes subsequently be disclosed to the Company's Shareholders
under certain circumstances.
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MANAGEMENT RECOMMENDS A VOTE "FOR" EACH OF THE NOMINEES
FOR DIRECTOR NAMED BELOW
NOMINEES
The table below indicates the respective nominee's position with the
Company, age, and year in which he first became a Director.
DIRECTOR
NAME, POSITION AND BACKGROUND AGE SINCE
GARY L. HESS, President, Chief Executive and Financial Officer 48 1996
and Director. Mr. Hess was elected President and Chief Executive
Officer of the Company on May 1, 1996 and Chief Financial Officer
on June 14, 1999. Prior thereto he was a Senior Vice President of
Dole Food Company, Inc. (fresh and processed fruit) (1993-1996);
President of Cadace Enterprises, Inc. (water conservation
products) and The Marketing Partnership 1992-1993; and Director
of Marketing, E. & J. Gallo Winery (wine and distilled spirits)
(1987-1992).
ROGER S. MERTZ, Director. Mr. Mertz is an attorney-at-law. He is 56 1993
a partner of the California law firm of Allen Matkins Leck Gamble
& Mallory LLP. Prior to October 1999, Mr. Mertz was a member of
the San Francisco, California law firm of Severson & Werson.
FREDRIC SELINGER, Director. Mr. Selinger is Senior Managing 61 1999
Director of Corporate Finance of Sutter Securities, Incorporated
(private investment banking and consulting). Prior to March 1995,
Mr. Selinger was Managing Director of Jackson Square Capital
Corp. (private investment banking and consulting).
CRAIG R. STAPLETON, Director. Mr. Stapleton is President of Marsh 56 1995
& McLennan Real Estate Advisors, Inc. (real estate management).
Mr. Stapleton is a director of Allegheny Properties, Inc. (real
estate investments); a director of T.B. Woods, Incorporated
(industrial power transmission products); and a director of
Cornerstone Properties (real estate investments).
BOARD COMMITTEES AND MEETINGS
The Board of Directors met eight times during the fiscal year ending June
30, 2000. The Company's Board of Directors has authorized two standing
committees.
COMPENSATION AND RETIREMENT SAVINGS COMMITTEE. The functions of the
Compensation and Retirement Savings Committee are to develop and recommend to
the full Board compensation arrangements, including bonuses, stock options, and
stock appreciation rights, for Executive Officers and other key employees; to
advise the chief executive officer on policy matters concerning officers'
compensation; to direct the management of the Company's Retirement, Savings and
Profit Sharing Plan; and to administer the 1996 Stock Option Plan, as amended.
The members of the committee are Messrs. Stapleton (Chairman), Mertz and
Selinger. The Compensation and Retirement Savings Committee held one meeting
during the fiscal year.
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<PAGE>
AUDIT COMMITTEE. The function of the Audit Committee is to recommend to the
full Board the accounting firm to be retained as the Company's independent
auditors and the price to be paid to the firm, and to consult with the auditors
regarding the plan of audit, the results of the audit and the audit report, and
the adequacy of internal accounting controls. The members of the committee are
Messrs. Mertz (Chairman), Selinger and Stapleton. The Audit Committee held one
meeting during the fiscal year.
On April 24, 2000, the Board adopted an Audit Committee Charter that
complies with the new standards set forth in Securities and Exchange Commission
regulations and the Nasdaq Stock Market's independent director and audit
committee listing standards. These changes required, in part, that all companies
listed on Nasdaq certify by June 14, 2000 that they have adopted a formal
written audit committee charter and will review and assess the adequacy of the
charter on an annual basis. The Audit Committee Charter is attached to this
Proxy Statement as Appendix A. The new standards also require that the Company's
Audit Committee meet certain structural and membership requirements by June 14,
2001, which it intends to timely comply with before next June.
The full Board acts as the nominating committee for the Directors of the
Company.
COMPENSATION OF DIRECTORS
EMPLOYEE DIRECTOR COMPENSATION. Directors who are also employees of the
Company are not specifically compensated for duties as directors. See "Executive
Compensation."
NON-EMPLOYEE DIRECTOR COMPENSATION. Directors who are not employees of the
Company receive $1,200 per quarter for serving as Directors, $600 for each Board
or committee meeting attended, and $400 for each telephone call Board meeting
($200 if less than 30 minutes). Directors' fees paid by the Company during
fiscal year 2000 totaled $17,700.00. In connection with their consulting
services to the Company, on April 24, 2000, Messrs. Mertz, Selinger and
Stapleton received a fully vested non-qualified stock option to purchase 5,000
shares of the Company's Common Stock at $5.00 per share.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
For the fiscal year ended June 30, 2000, the Compensation Committee
consisted of Messrs. Stapleton, Mertz and Selinger, none of whom is an employee
of the Company. The San Francisco law firm of Allen Matkins Leck Gamble &
Mallory LLP, of which Mr. Mertz is a partner, served as the Company's legal
counsel during fiscal year 2000. Sutter Securities, Incorporated, of which Mr.
Selinger is Senior Managing Director of Corporate Finance, served as a financial
advisor and rendered a fairness opinion to the Company in connection with its
July 1999 sale of assets to Tree Top, Inc. for which it received a fee of
$50,000.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following tables, based in part upon information supplied by officers,
directors and principal Shareholders, set forth certain information known to the
Company with respect to beneficial ownership of the Company's Common Stock as of
September 13, 2000, by (i) each beneficial owner of more than 5% of the
Company's Common Stock, (ii) the Company's Chief Executive Officer and each of
the four other most highly compensated executive officers whose aggregate
compensation exceeded $100,000 for the fiscal year ended June 30, 2000,
(collectively, the "Named Executive Officers"), (iii) each director of the
Company, and (iv) all directors and executive officers of the Company as a
group. Except as otherwise indicated, each person has sole voting and investment
power with respect to all shares shown as beneficially owned, subject to
community property laws where applicable. Voting power is the power to vote or
direct the voting of securities, and investment power is the power to dispose of
or direct the disposition of securities.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
SHARES OF COMMON STOCK
BENEFICIALLY OWNED (a)
-----------------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER PERCENT
------------------------------------ ------ -------
Craig R. Stapleton 431,716(b) 28.3%
281 Lake Avenue
Greenwich, CT 06830
(a) Security ownership information for beneficial owners is taken from
statements filed with the Securities and Exchange Commission pursuant to
Sections 13(d), 13(g) and 16(a) and information made known to the company.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of common stock subject
to options that are currently exercisable or exercisable within 60 days of
September 13, 2000 are deemed to be outstanding for the purpose of
computing the percentage ownership of the person holding those options, but
are not treated as outstanding for the purpose of computing the percentage
ownership of any other person. The percentage of beneficial ownership is
based on 1,522,350 shares of common stock outstanding as of September 13,
2000.
(b) Includes 279,866 shares owned directly by Mr. Stapleton or trusts for the
benefit of Mr. Stapleton, 5,000 shares issuable upon the exercise of stock
options, 61,950 shares as trustee of a trust for the benefit of his
children and certain other relatives and to which Mr. Stapleton disclaims
any beneficial interest, and 84,900 shares owned by Mr. Stapleton's wife
and children to which Mr. Stapleton disclaims any beneficial interest.
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<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The table below presents the security ownership of the Company's
Directors, Named Executive Officers, and all directors and executive officers as
a group as of September 13, 2000.
SHARES BENEFICIALLY OWNED (a)
-------------------------
NAME OF BENEFICIAL OWNER NUMBER PERCENT
------------------------ ------ -------
William Burgess 4,000 *
Gary L. Hess 115,017(b) 7.1%
Roger S. Mertz 55,266(c) 3.6%
Fredric Selinger 7,000(d) *
Craig R. Stapleton 431,716(e) 28.3%
All directors and executive officers as a
group (5 persons) 612,999 37.7%
----------
* Does not exceed 1% of the referenced class of securities.
(a) Shares listed in this column include all shares held by the named
individuals and all directors and executive officers as a group in their
own names and in street name and also includes all shares allocated to the
accounts of the named individuals and all directors and executive officers
as a group under the Company's Employee Stock Purchase Plan. Security
ownership information for beneficial owners is taken from statements filed
with the Securities and Exchange Commission pursuant to Sections 13(d),
13(g) and 16(a) and information made known to the company. Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission and generally includes voting or investment power with
respect to securities. Shares of common stock subject to options that are
currently exercisable or exercisable within 60 days of September 13, 2000
are deemed to be outstanding for the purpose of computing the percentage
ownership of the person holding those options, but are not treated as
outstanding for the purpose of computing the percentage ownership of any
other person. The percentage of beneficial ownership is based on 1,522,350
shares of common stock outstanding as of September 13, 2000.
(b) Includes 25,543 shares owned directly and 89,474 shares issuable upon the
exercise of stock options.
(c) Includes 44,266 shares owned directly, 5,000 shares issuable upon the
exercise of stock options, and 6,000 shares held by Mr. Mertz as trustee
and to which Mr. Mertz disclaims any beneficial interest.
(d) Includes 2,000 shares owned directly and 5,000 shares of issuable upon the
exercise of stock options.
(e) Includes 279,866 shares owned directly by Mr. Stapleton or trusts for the
benefit of Mr. Stapleton, 5,000 shares issuable upon the exercise of stock
options, 61,950 shares as trustee of a trust for the benefit of his
children and certain other relatives and to which Mr. Stapleton disclaims
any beneficial interest, and 84,900 shares owned by Mr. Stapleton's wife
and children to which Mr. Stapleton disclaims any beneficial interest.
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<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION OF NAMED EXECUTIVES
The Summary Compensation Table shows certain compensation information for
the Chief Executive Officer and each of the four other most highly compensated
executive officers whose aggregate compensation exceeded $100,000 for the fiscal
year ended June 30, 2000, (collectively, the "Named Executive Officers").
Compensation data is shown for the fiscal years ended June 30, 2000, 1999 and
1998. This information includes the dollar value of base salaries, bonus awards,
the number of SARs granted, and certain other compensation, if any, whether paid
or deferred.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE(a)
================================================================================================================================
Long Term
Compensation All Other
Annual Compensation Awards Compensation
Name and Principal Position Year Salary($) Bonus($) Options/SARS (#) ($)
--------------------------- ---- --------- -------- ------------------- -----------
<S> <C> <C> <C> <C> <C>
Gary L. Hess(b) 2000 176,016 17,600 -0- 21,724(c)
President and Chief Executive Officer 1999 178,670 -0- -0- 19,268(d)
1998 160,000 80,000 -0- 18,178(e)
William Burgess(f) 2000 104,846 -0- -0- 5,778(g)
Vice President
</TABLE>
----------
(a) Amounts shown include cash and non-cash compensation earned with respect to
the year shown above.
(b) Mr. Hess was appointed President and Chief Executive Officer on May 1,
1996, and Chief Financial Officer on June 14, 1999.
(c) The Company contributed $14,084 with respect to the 401(k) plan, $428 for a
life insurance benefit, $12 for a group term life insurance payment, and a
$7,200 car allowance.
(d) The Company contributed $11,640 with respect to the 401(k) plan, $428 for a
life insurance benefit, and a $7,200 car allowance.
(e) The Company contributed $10,764 with respect to the 401(k) plan, $214 for a
life insurance benefit, and a $7,200 car allowance.
(f) Mr. Burgess was appointed Vice President on September 15, 1998 and resigned
effective July 31, 2000.
(g) The Company contributed $5,763 with respect to the Company's 401(k) plan,
and $15 for a life insurance payment.
INCENTIVE AND REMUNERATION PLANS
STOCK APPRECIATION RIGHTS PLAN
In 1985, the Shareholders of the Company approved the adoption of a Stock
Appreciation Rights Plan (the "SAR Plan"). The SAR Plan was adopted to reward
participants for past services and to encourage them to remain in the Company's
service by offering participants an opportunity to participate in any
appreciation in the market value of the Company's common stock. There were no
participants in the SAR Plan in fiscal year ended June 30, 2000.
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<PAGE>
EMPLOYEE BONUS PLAN
The Company maintains an Employee Bonus Plan as an incentive to key
employees of the Company. The bonus an employee receives is dependent on
individual performance and level of responsibility as well as the achievement by
the Company of a threshold level of return on shareholders' equity. In fiscal
year ended June 30, 2000, $39,091 in bonuses were earned under the bonus plan.
STOCK PARTICIPATION AND OPTION PLANS
1994 EMPLOYEE STOCK PURCHASE PLAN
In 1994, the Shareholders approved the adoption of the 1994 Employee Stock
Purchase Plan (the "Stock Purchase Plan"). All employees, including executive
officers, may purchase shares of the Company's common stock at a discount of 15%
from the market price of the shares. The maximum aggregate number of shares to
be offered under the Stock Purchase Plan is 100,000 shares of the Company's
common stock. In fiscal year ended June 30, 2000, 2,910 shares were issued under
the Stock Purchase Plan. As of June 30, 2000, approximately 62,000 shares of the
Company's common stock had been issued under the Stock Purchase Plan.
1996 STOCK OPTION PLAN, AS AMENDED
The Company's 1996 Stock Option Plan, (the "Option Plan") which was
approved by the Shareholders at the 1996 Annual Meeting, is intended to advance
the interests of the Company by inducing persons of outstanding ability and
potential to join and remain with the Company by enabling them to acquire
proprietary interest in the Company. The Option Plan was adopted for the
principal purpose of assisting the Company in recruiting a new President and
Chief Executive Officer of the Company. An amendment to the Option Plan
increasing the number of shares available for issuance under the Option Plan to
275,000 was approved by the Shareholders at the 1999 Annual Meeting. A total
31,600 options were granted under the Option Plan in fiscal year 2000. As of
September 13, 2000, options to purchase 147,374 shares have been issued under
the Option Plan.
GENERAL. The Option Plan provides for the granting of two types of options:
"incentive stock options" and "non-qualified stock options." The incentive stock
options only are intended to qualify as "incentive stock options" as defined in
Section 422 of the Internal Revenue Code of 1986, as amended. The Option Plan is
not qualified under Section 401(a) of the Internal Revenue Code nor is it
subject to the provisions of ERISA. Options may be granted under the Option Plan
to all key employees and to non-employee consultants of the Company; provided,
however, that incentive stock options may only be granted to employees and not
to any non-employee consultants.
ADMINISTRATION. Administration of the Option Plan is by the Company's
Compensation and Retirement Savings Committee which has the power, subject to
the terms of the Option Plan, to grant options, determine the option price and
term of each option, and the persons to whom and the time or times at which
options shall be granted.
OPTION TERMS. The maximum term of each option is ten years. Options granted
under the Option Plan generally terminate three months after the optionee ceases
to be employed by the Company, a parent or subsidiary, except if termination is
due to the employee's permanent and total disability, in which event the option
may be exercised within a year of termination. In the event of the employee's
death, the employee's estate has 12 months to exercise the option.
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CHANGES IN STOCK AND EFFECT OF CERTAIN CORPORATE EVENTS. If there is any
change in the Common Stock subject to the Option Plan or subject to any option
granted under the Option Plan, whether through merger, consolidation,
reorganization, recapitalization, dividend or otherwise, the Option Plan
provides that an appropriate adjustment be made by the Committee to the
aggregate number of shares subject to the Option Plan and the number of shares
and the price per share of stock subject to the outstanding options. In the
event of dissolution, liquidation or specified types of merger of the Company,
the options granted under the Option Plan terminate unless the surviving entity
assumes the outstanding options or substitutes similar options.
AMENDMENT AND TERMINATION. The Board of Directors may amend or terminate
the Option Plan at any time, except that any amendment which would (i)
materially increase the benefits accruing to participants, or (ii) materially
modify the eligibility requirements will only be effective if approved by the
Company's shareholders within 12 months before or after adoption. Unless
terminated earlier, the Option Plan will terminate on March 15, 2006.
FEDERAL INCOME TAX CONSEQUENCES. Incentive stock options granted under the
Plan are intended to be eligible for the favorable income tax treatment accorded
incentive stock options under Section 422 of the Internal Revenue Code.
Non-qualified stock options granted under the Option Plan are subject to federal
income tax treatment pursuant to rules governing options that are not incentive
stock options.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information with respect to the stock
options granted from July 1, 1999 to June 30, 2000 to the Named Executive
Officers under the Option Plan. No additional options were granted to the Named
Executive Officers after June 30, 2000 and prior to the date of this Proxy
Statement.
Name Options Granted Dollar Value ($)
---- --------------- ----------------
Gary L. Hess -0- -0-
William Burgess -0- -0-
EMPLOYMENT CONTRACTS
The Company entered into an Employment Agreement with Mr. Hess dated March
14, 1996, pursuant to which Mr. Hess is employed by the Company as its
President, Chief Executive and Financial Officer. Under the agreement, Mr. Hess
is entitled to an annual base salary, which is subject to annual review, a
discretionary incentive bonus, and other requirements as may be agreed.
Additionally, Mr. Hess was granted an option to purchase 89,474 shares of the
Company's Common Stock at $5.00 per share, the fair market value of a share of
the Company's Common Stock on May 1, 1996. The options were granted pursuant to
the Company's 1996 Stock Option Plan. Under the agreement, Mr. Hess serves at
will. In addition, Mr. Hess is entitled to the reimbursement of relocation
expenses, temporary living expense, an automobile allowance and certain other
fringe benefits. On June 20, 1999, the Company and Mr. Hess amended the
Employment Agreement such that in the event of termination of his employment by
the Company prior to June 17, 2002, for any reason other than cause or other
than upon resignation, Mr. Hess is entitled to continued salary at the salary
provided above for that number of months which remain between the date of
termination and June 17, 2002, but not less than six.
CONSULTING AGREEMENT BETWEEN MR. HESS AND TREE TOP, INC.
As part of the Company's asset sale of its apple product lines to Tree Top,
Inc., Mr. Hess entered into a three-year consulting and non-competition
agreement with Tree Top as of June 17, 1999. The
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<PAGE>
consulting agreement provides for payments to Mr. Hess in the amount of $833 per
month in return for consulting and advisory services concerning the product
lines sold to Tree Top. It is estimated that Mr. Hess' consulting services will
average 5 hours per month, and in no event will exceed 10 hours per month.
During the term of the agreement, Mr. Hess has agreed not to directly or
indirectly own, manage, control, participate in, perform services for or
otherwise carry on a business competitive with the apple product lines anywhere
in the world.
COMPENSATION AND RETIREMENT SAVINGS COMMITTEE REPORT
This report is provided by the Compensation and Retirement Savings
Committee of the Board of Directors (the "Committee") to assist shareholders in
understanding the Committee's objectives and procedures in establishing the
compensation of the Company's Chief Executive Officer and other executive
officers. The Committee, made up of non-employee Directors, is responsible for
establishing and administering the Company's executive compensation program.
The Company's executive compensation program is designed to motivate,
reward, and retain the management talent needed to achieve its business
objectives and maintain its competitiveness during the Company's strategic
reorientation to a real estate investment and management business. It does this
by utilizing competitive base salaries that recognize a philosophy of career
continuity and by rewarding exceptional performance and accomplishments that
contribute to the Company's success.
COMPENSATION PHILOSOPHY AND OBJECTIVE
The philosophical basis of the compensation program is to pay for
performance and the level of responsibility of an individual's position. The
Committee finds greatest value in executives who possess the ability to
implement the Company's business plans as well as to react to unanticipated
external factors that can have a significant impact on corporate performance.
Compensation decisions for all executives, including the Named Executive
Officers, are based on the same criteria. These include quantitative factors
that reflect improvements in the Company's short and long-term financial
performance, as well as qualitative factors which reflect the strength of the
Company over the long term, such as demonstrated leadership skills and the
ability to deal quickly and effectively with difficulties which sometimes arise.
The Committee believes that compensation of the Company's key executives
should:
1. Link rewards to business results and shareholder returns;
2. Encourage creation of shareholder value and achievement of strategic
objectives;
3. Maintain an appropriate balance between base salary and short-and long-term
incentive opportunity;
4. Attract and retain, on a long-term basis, highly qualified executive
personnel; and
5. Provide total compensation opportunity that is competitive with that
provided by competitors in the food processing industry, taking into
account relative company size and performance as well as individual
responsibilities and performance.
KEY ELEMENTS OF EXECUTIVE COMPENSATION
The Company's executive compensation program consists of three elements: Base
Salary, Short-Term Incentives and Long-Term Incentives. Payout of short-term
incentives depends on corporate performance. Payout of the long-term incentives
depends on performance of the Company's stock.
-10-
<PAGE>
BASE SALARY. A competitive base salary is crucial to support the philosophy
of management development and career orientation of executives. Salaries are
targeted to pay level with the Company's competitors and companies having
similar capitalization, revenues, etc. Executive salaries are reviewed annually.
Assessment of an individual's relative performance is made annually based on a
number of quantitative factors such as stock price, earnings and revenues, as
well as qualitative factors which include initiative, business judgment,
technical expertise, and management skills.
SHORT-TERM INCENTIVE. Short-term awards to executives are made in cash to
recognize contributions to the Company's business during the past year. The
Company maintains an Employee Bonus Plan as an incentive for certain key
employees of the Company. The bonus an executive receives is dependent on
individual performance and level of responsibility.
LONG-TERM INCENTIVE. Long-term incentive awards provided by
shareholder-approved compensation programs are designed to develop and maintain
strong management through share appreciation awards. The Company's 1985 Stock
Appreciation Rights Plan creates incentives for executives and other key
employees by providing them with an opportunity to indirectly participate in the
appreciation in the market value of the Company's common stock. The 1994
Employee Stock Purchase Plan permits all employees, including executive
officers, to purchase shares of the Company's common stock at a discount of 85%
of the market value on the first or last business day of the quarterly offering
period, whichever is lower. The 1996 Stock Option Plan, as amended, provides for
the granting to employees of incentive stock options, which promotes the
long-term interests of the Company's Shareholders.
2000 CHIEF EXECUTIVE OFFICER COMPENSATION
For the fiscal year ending June 30, 2000, Mr. Hess' base salary was
$176,016. He also earned a discretionary bonus in the amount of $17,600. Mr.
Hess received a total of $14,084 as a contribution to the Company's 401(k) plan
and Profit Sharing Plan. The Committee believes Mr. Hess' total compensation
package is appropriate for Mr. Hess' level of responsibility and is well within
competitive practice. The Committee also believes the compensation is
appropriate to the Company's financial performance during the year.
Compensation Committee:
Craig R. Stapleton, Chairman
Roger S. Mertz
Fredric Selinger
-11-
<PAGE>
SHARE INVESTMENT PERFORMANCE
The following graph compares the total return performance of the Company
for the periods indicated with the performance of the NASDAQ Market Index, the
Russell 2000 Index and the performance of two Peer Indices comprised of
companies having the same Standard Industrial Classification ("SIC") number as
the Company. The Company's shares are traded over-the-counter on the NASDAQ
National Market under the symbol "SWHI".
After selling its industrial dried fruit ingredients and organic packaged
foods divisions, the Company's sole line of business is its real estate
management and rental operations. Consequently, its SIC group and peer group
have changed. When a company selects a different peer index, Securities and
Exchange Commission rules require that the company compare its total return with
both the newly selected index and the index used in the immediately preceding
year. The Old Peer Group Index includes the publicly traded stocks of Ampal
American Israel Corp., Chiquita Brands International Inc., H.J. Heinz Co.,
Odwalla Inc., Seneca Foods Corp. Class B, J.M. Smucker Co. Class A, Unimark
Group, Inc., and SonomaWest Holdings, Inc. The New Peer Group Index includes the
publicly traded stocks of Crescent Operating Inc., Focal Corp., Monmouth Capital
Corp., Omega Worldwide, Inc., Regency Equities Corp., Sarnia Corp., and
SonomaWest Holdings, Inc. Three of the companies in the New Peer Group have
market capitalizations greater than the Company and three have market
capitalizations less than the Company. The Company is also comparing itself
against the Russell 2000 Index, which is a more suitable broad equity market
index comparison. The NASDAQ Index includes only shares of companies traded on
the NASDAQ National Market System or over-the-counter, which have been publicly
traded continuously since June 30, 1992. The Russell 2000 Index is comprised of
the publicly traded stocks of the 2,000 smallest companies included in the
Russell 3,000 Index, which includes the publicly traded stocks of the 3,000
largest companies. The total return indices reflect reinvested dividends and are
weighted on a market capitalization basis at the time of each reported data
point.
-12-
<PAGE>
PERFORMANCE GRAPH
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG SONOMA WEST HOLDINGS, INC.,
THE NASDAQ STOCK MARKET (U.S.) INDEX, THE RUSSELL 2000 INDEX,
AN OLD PEER GROUP AND A NEW PEER GROUP
[LINE CHART OMITTED]
Year (June 30) 1995 1996 1997 1998 1999 2000
-------------- ---- ---- ---- ---- ---- ----
SonomaWest Holdings, Inc. 100 102 95 156 190 120
Nasdaq Stock Market (U.S.) 100 128 156 206 296 437
Russell 2000 100 124 144 168 170 176
Old Peer Group Index 100 106 158 194 176 160
New Peer Group Index 100 110 103 146 71 39
-13-
<PAGE>
PROPOSAL 2
SHAREHOLDER REQUEST THAT THE COMPANY
DECLARE AND PAY A CASH DIVIDEND
BACKGROUND
Since the Company acquired certain of the assets and liabilities of Made in
Nature, Inc., on June 11, 1998, SonomaWest has operated in three business
segments: industrial dried fruit ingredients, organic packaged goods, and real
estate. In July 1999, the Company commenced execution of its strategic plan to
increase the return on its investments and increase shareholder value by exiting
seasonal businesses with low returns and high capital requirements. By selling
or discontinuing all of the Company's business segments in industrial dried
fruit ingredients and organic packaged foods, execution of the strategic plan
has provided financial resources to support the Company's real estate and other
business opportunities.
SHAREHOLDER PROPOSAL
The following proposal has been presented by Ms. Marta Biggers, 15111 N.
Hayden Road, Suite 160-343, Scottsdale, Arizona 85260, who is the owner of
40,000 shares of the Company's common stock:
"PROPOSAL
The shareholders are being requested to consider and approve the
declaration and payment of a cash dividend to shareholders of record with
entitlement to vote at the 2000 Annual Shareholders Meeting.
HISTORY
During 1994 and 1995 VacuDry Company paid dividends to shareholders of
$.05 and $.15 per share respectively.
VacuDry Company, on January 26, 1990 entered into an agreement in
which various assets of the VacuDry apple sauce and apple juice lines were
sold to Krouse Foods, Inc. The cash proceeds realized from the sale were
$5,058,000; the pretax gain was $1,631,000.
On April 23, 1990 VacuDry Company paid dividends amounting to
$2,502,000.
RECENT EVENTS
Financial information at December 31, 1999 reported the company
holding cash balances of $8,646,000 and $7,962,000 at March 31, 2000. The
sale of certain assets of Made In Nature on May 26, 2000 resulted in a
further cash receipt of $1,100,000.
The shareholders are asked to approve the following resolution:
RESOLVED, that the Company, declare and pay a cash dividend to those
shareholders of record at the date of the entitlement to vote at the Annual
Meeting."
-14-
<PAGE>
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors unanimously recommends a vote AGAINST the
shareholder's proposal that the Company declare and pay a cash dividend to the
Shareholders of record for the following reasons:
o The Board of Directors is already considering alternative plans to
distribute excess cash to the Shareholders.
o The exact method and manner of how to distribute excess cash to
Shareholders requires a complex analysis of how much cash the Company
has available and of the most tax advantaged strategy on how to
distribute any excess cash.
o A cash dividend, like the one proposed by Shareholder Biggers, is the
most tax disadvantaged form of distribution to Shareholders. The Board
is considering other options such as a repurchase of shares or a
liquidating distribution, which may provide better tax benefits to the
Shareholders.
o The Board and management have not yet fully quantified the costs
involved in leasing and developing the Company's remaining real
property assets, paying its mandatory debt repayments, funding the net
losses of its continuing business operations, or implementing its
contemplated investment programs. Until those costs are finalized, the
amount of excess cash is uncertain.
o The Shareholder proposal to pay a dividend does not take into
consideration the complex decisions about the Company that the Board
is currently evaluating.
Overall, the Board of Directors feels that declaring a dividend is not in
the best interests of the Shareholders.
The affirmative vote of the holders of a majority of the shares of common
stock voting in person or by proxy is required to approve this proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" THE SHAREHOLDER
PROPOSAL THAT THE COMPANY DECLARE AND PAY A CASH DIVIDEND.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers, directors, and persons who own more than ten percent of a
registered class of the Company's equity securities to file reports of ownership
and changes in ownership with the Securities and Exchange Commission. Executive
officers, directors and greater than ten-percent shareholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that, during fiscal year ended
June 30, 2000 all filing requirements applicable to its executive officers,
directors, and greater than ten-percent beneficial owners were complied with
except that Mr. Stapleton filed late ten Forms 4 and Mr. Hess filed late one
Form 4.
-15-
<PAGE>
PROPOSAL 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board has selected Arthur Andersen LLP, independent auditors, to audit
the financial statements of the Company for the fiscal year ending June 30,
2001. Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting and will have the opportunity to make a statement if they so
desire. The representatives also are expected to be available to respond to
appropriate questions from shareholders.
The affirmative vote of the holders of a majority of the shares of common
stock voting in person or by proxy on this proposal is required to ratify the
appointment of the independent auditors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS.
OTHER MATTERS
The Board of Directors presently knows of no other matter that may come
before the Annual Meeting. If any other matters should properly come before the
Meeting, however, the Board's proxy holders intend to vote on such matters in
accordance with their best judgment.
By Order of the Board of Directors
Roger S. Mertz
SECRETARY
Dated: October 11, 2000
-16-
<PAGE>
APPENDIX A
SONOMA WEST HOLDINGS INC.
CHARTER OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
I. AUDIT COMMITTEE PURPOSE
The Audit Committee is appointed by the Board of Directors to assist the
Board in fulfilling its oversight responsibilities. The Audit Committee's
primary duties and responsibilities are to:
o Monitor the integrity of the Company's financial reporting
process and systems of internal controls regarding finance,
accounting, and legal compliance.
o Monitor the independence and performance of the Company's
independent auditors and internal auditing department.
o Provide an avenue of communication among the independent
auditors, management, the internal auditing department, and the
Board of Directors.
The Audit Committee has the authority to conduct any investigation
appropriate to fulfilling its responsibilities, and it has direct access to
the independent auditors as well as anyone in the organization. The Audit
Committee has the ability to retain, at the Company's expense, special
legal, accounting, or other consultants or experts it deems necessary in
the performance of its duties.
II. AUDIT COMMITTEE COMPOSITION AND MEETINGS
Audit Committee members shall meeting the requirements of the Nasdaq
Marketplace Rules. The Audit Committee shall be comprised of three or more
directors as determined by the Board, each of whom shall be independent
nonexecutive directors, free from any relationship that would interfere
with the exercise of his or her independent judgment. All members of the
Committee shall have a basic understanding of finance and accounting and be
able to read and understand fundamental financial statements, and at least
one member of the Committee shall have accounting or related financial
management expertise.
Audit Committee members shall be appointed by the Board on recommendation
of the Nominating Committee. If an audit committee Chair is not designated
or present, the members of the Committee may designate a Chair by majority
vote of the Committee membership.
The Committee shall meet at least two times annually, or more frequently as
circumstances dictate. The Audit Committee Chair shall prepare and/or
approve an agenda in advance of each meeting. The Committee should meet
privately in executive session at least annually with management, the
director of the internal auditing department, the independent auditors, and
as a committee to discuss any matters that the Committee or each of these
groups believe should be discussed. In addition, the Committee, or at least
its Chair, should communicate with management and the independent auditors
quarterly to review the Company's financial statements and significant
findings based upon the auditors' limited review procedures.
<PAGE>
III. AUDIT COMMITTEE RESPONSIBILITIES AND DUTIES
REVIEW PROCEDURES
1. Review and reassess the adequacy of this Charter at least annually.
Submit the charter to the Board of Directors for approval and have the
document published at least every three years in accordance with SEC
regulations.
2. Review the Company's annual audited financial statements prior to
filing or distribution. Review should include discussion with
management and independent auditors of significant issues regarding
accounting principles, practices, and judgments.
3. In consultation with the management, the independent auditors, and the
internal auditors, consider the integrity of the Company's financial
reporting processes and controls. Discuss significant financial risk
exposures and the steps management has taken to monitor, control, and
report such exposures. Review significant findings prepared by the
independent auditors and the internal auditing department together
with management's responses.
4. Review with financial management and the independent auditors the
company's quarterly financial results prior to the release of earnings
and/or the company's quarterly financial statements prior to filing or
distribution. Discuss any significant changes to the company's
accounting principles and any items required to be communicated by the
independent auditors in accordance with SAS 61 (see item 9). The Chair
of the Committee may represent the entire Audit Committee for purposes
of this review.
INDEPENDENT AUDITORS
1. The independent auditors are ultimately accountable to the Audit
Committee and the Board of Directors. The Audit Committee shall review
the independence and performance of the auditors and annually
recommend to the Board of Directors the appointment of the independent
auditors or approve any discharge of auditors when circumstances
warrant.
2. Approve the fees and other significant compensation to be paid to the
independent auditors.
3. On an annual basis, the Committee should review and discuss with the
independent auditors all significant relationships they have with the
Company that could impair the auditors' independence.
4. Review the independent auditors audit plan - discuss scope, staffing,
locations, reliance upon management, and internal audit and general
audit approach.
5. Prior to releasing the year-end earnings, discuss the results of the
audit with the independent auditors. Discuss certain matters required
to be communicated to audit committees in accordance with AICPA SAS
61.
6. Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in
its financial reporting.
Appendix A
-2-
<PAGE>
INTERNAL AUDIT DEPARTMENT AND LEGAL COMPLIANCE
1. Review the budget, plan, changes in plan, activities, organizational
structure, and qualifications of the internal audit department, as
needed.
2. Review the appointment, performance, and replacement of the senior
internal audit executive.
3. Review significant reports prepared by the internal audit department
together with management's response and follow-up to these reports.
4. On at least an annual basis, review with the Company's counsel, any
legal matters that could have a significant impact on the
organization's financial statements, the Company's compliance with
applicable laws and regulations, and inquiries received from
regulators or governmental agencies.
OTHER AUDIT COMMITTEE RESPONSIBILITIES
1. Annually prepare a report to shareholders as required by the
Securities and Exchange Commission. The report should be included in
the Company's annual proxy statement.
2. Perform any other activities consistent with this Charter, the
Company's by-laws, and governing law, as the Committee or the Board
deems necessary or appropriate.
3. Maintain minutes of meetings and periodically report to the Board of
Directors on significant results of the foregoing activities.
OTHER OPTIONAL CHARTER DISCLOSURES
1. Review financial and accounting personnel succession planning within
the Company.
2. Annually review policies and procedures as well as audit results
associated with directors' and officers expense accounts and
perquisites. Annually review a summary of director and officers'
related party transactions and potential conflicts of interest.
Appendix A
-3-
<PAGE>
EXAMPLE OF AUDIT COMMITTEE MEETING AGENDA FOR YEAR
As noted previously, it is important to review the completeness of the audit
committee charter as well as the agenda established for each meeting. The
following is an example of topics that could be covered in each audit committee
meeting. This example assumes a June year-end company that scheduled four audit
committee meetings in connection with quarterly earning releases.
<TABLE>
<CAPTION>
-----------------------------------------
Scheduled Meetings
-----------------------------------------
CHARTER STEP October January April July
------------ ----------- --------- --------- ---------
<S> <C> <C> <C> <C>
I. AUDIT COMMITTEE PURPOSE
Conduct special investigations * * * *
----------- --------- --------- ---------
II. AUDIT COMMITTEE COMPOSITION AND MEETINGS
----------- --------- --------- ---------
Assess independence and financial literacy of audit committee X
----------- --------- --------- ---------
Establish number of meetings X
----------- --------- --------- ---------
Audit Committee Chair to establish meeting agenda X X X X
----------- --------- --------- ---------
Enhance financial literacy - update on current financial events X X X X
----------- --------- --------- ---------
Executive session with auditors, internal audit, management, committee X X X X
----------- --------- --------- ---------
II. AUDIT COMMITTEE RESPONSIBILITIES AND DUTIES
----------- --------- --------- ---------
Review charter, publish in proxy X
----------- --------- --------- ---------
Review annual financial statements - discuss with management, auditors
X
----------- --------- --------- ---------
Consider internal controls and financial risks X X
----------- --------- --------- ---------
Review quarterly results and findings X X X X
----------- --------- --------- ---------
Recommend appointment of auditors X
----------- --------- --------- ---------
Approve audit fees X
----------- --------- --------- ---------
Discuss auditor independence X
----------- --------- --------- ---------
Review auditor plan X
----------- --------- --------- ---------
Discuss year-end results, SAS 61 report X
----------- --------- --------- ---------
Discuss quality of accounting principles * * * X
----------- --------- --------- ---------
Review internal audit plan X
----------- --------- --------- ---------
Review appointment, performance of internal audit executive X
----------- --------- --------- ---------
Review significant internal audit reports * * * *
----------- --------- --------- ---------
Review legal matters with counsel * X
----------- --------- --------- ---------
Prepare report to shareholders X
----------- --------- --------- ---------
Perform other activities as appropriate * * * *
----------- --------- --------- ---------
Maintain minutes and report to Board X X X X
----------- --------- --------- ---------
Review financial personnel succession planning X
----------- --------- --------- ---------
Review director and officer expenses and related party transactions X
----------- --------- --------- ---------
</TABLE>
X = Recommended Timing * = As Needed
<PAGE>
SONOMA WEST HOLDINGS, INC.
1448 Industrial Avenue
Sebastopol, California 95472-4848
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. The
undersigned hereby appoints Gary L. Hess and Roger S. Mertz, or either of them,
with full power of substitution, as Proxies of the undersigned to attend the
Annual Meeting of Shareholders of SonomaWest Holdings, Inc. to be held on
Thursday, November 9, 2000, and any adjournment thereof, and to vote the number
of shares the undersigned would be entitled to vote if personally present as
indicated below.
1. Election of four directors to serve until the 2001 Annual Meeting of
Shareholders or until their respective successors are elected and
qualified.
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY
(except as marked to the to vote for all nominees
contrary below) listed below
(Instructions: To withhold authority to vote for any individual nominee
strike a line through the nominee's name in the list below.)
Gary L. Hess; Roger S. Mertz; Fredric Selinger; Craig R. Stapleton
2. Shareholder proposal that the Company declare and pay a cash dividend.
[ ] FOR the proposal [ ] AGAINST the proposal
3. Approval of appointment of Arthur Andersen LLP as independent auditors for
the fiscal year ending June 30, 2001.
[ ] FOR the appointment [ ] AGAINST the appointment
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
The undersigned hereby acknowledge receipt of (a) Notice of Annual Meeting
of Shareholders to be held November 9, 2000, (b) the accompanying Proxy
Statement, and (c) the Annual Report of the Company for the fiscal year ended
June 30, 2000.
This Proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, the Proxy will
be voted FOR proposals one and three and AGAINST proposal two.
Please sign exactly as signature appears on this proxy card. Executors,
administrators, traders, guardians, attorneys-in-fact, etc. should give their
full titles. If signer is a corporation, please give full corporate name and
have a duly authorized officer sign, stating title. If a partnership, please
sign in partnership name by authorized person. If stock is registered in two
names, both should sign.
Dated: ______________________, 2000 _____________________________
Signature
_____________________________
Signature
