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
(Amendment No. )
Filed by the Registrant /_/
Filed by a Party other than the Registrant /_/
Check the appropriate box:
/_/ Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Aramex International Limited
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rule 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:
_____________________________________________________________________________
/_/ 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
<PAGE>
ARAMEX INTERNATIONAL LIMITED
2 BADR SHAKER ALSAYYAB STREET
UM UTHAYNA, AMMAN, JORDAN
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 17, 1998
To the Holders of the Common Stock of ARAMEX INTERNATIONAL LIMITED:
PLEASE TAKE NOTICE that the Annual General Meeting of Shareholders of
Aramex International Limited (the 'Company') will be held at 10:00 a.m. (local
time), on September 17, 1998, at the Company's corporate headquarters located at
2 Badr Shaker Alsayyab Street, Um Uthayna, Amman, Jordan for the following
purposes:
1. To elect two Class 2 Directors to serve until the 2001 annual general
meeting of shareholders or until their respective successors are duly
elected and qualified;
2. To ratify the appointment of Arthur Andersen LLP of Bahrain as the
independent public accountants of the Company for the fiscal year ending
December 31, 1998; and
3. To transact such other business as may properly come before the meeting
or any postponement or adjournment thereof.
4. To receive the financial statements of the Company for the fiscal year
ending December 31, 1997.
Only holders of the Common Stock of the Company at the close of business on
August 14, 1998 will be entitled to notice of and to vote at this meeting and
any adjournment or postponement thereof.
This proxy statement and the accompanying form of proxy, together with the
Company's 1997 Annual Report to Shareholders, are being mailed to shareholders
on or about August 19, 1998.
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING, PLEASE COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
CARD PROMPTLY. THIS WILL INSURE THAT YOUR SHARES ARE VOTED IN ACCORDANCE WITH
YOUR WISHES. YOUR COOPERATION IS APPRECIATED SINCE A MAJORITY OF THE OUTSTANDING
SHARES ENTITLED TO VOTE MUST BE REPRESENTED, EITHER IN PERSON OR BY PROXY, TO
CONSTITUTE A QUORUM FOR THE PURPOSES OF CONDUCTING BUSINESS AT THE MEETING.
By Order of the Board of Directors,
William S. Kingson Fadi Ghandour
Chairman of the Board Deputy Chairman, Chief Executive Officer,
President and Assistant Secretary
August 19, 1998
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
GENERAL INFORMATION........................................................................................... 1
Solicitation and Voting of Proxies; Revocation; Record Date.......................................... 1
MATTERS SUBMITTED TO SHAREHOLDERS............................................................................. 2
ELECTION OF DIRECTORS (Item 1 on Proxy Card)......................................................... 2
Nominees Standing for Election.............................................................. 2
Recommendation.............................................................................. 2
RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS (Item 2 on Proxy Card)................... 3
Recommendation.............................................................................. 3
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, DIRECTOR NOMINEES,
DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES...................................................... 3
DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES OF THE COMPANY................................................ 5
THE BOARD OF DIRECTORS AND ITS COMMITTEES..................................................................... 6
DIRECTOR, EXECUTIVE OFFICER AND KEY EMPLOYEE COMPENSATION..................................................... 6
Employment Agreements....................................................................... 7
Stock Options............................................................................... 8
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................................................................ 8
SHAREHOLDER PROPOSALS......................................................................................... 10
OTHER BUSINESS................................................................................................ 10
</TABLE>
<PAGE>
ARAMEX INTERNATIONAL LIMITED
2 BADR SHAKER ALSAYYAB STREET
UM UTHAYNA, AMMAN, JORDAN
------------------------------
PROXY STATEMENT
FOR
ANNUAL GENERAL MEETING OF SHAREHOLDERS
SEPTEMBER 17, 1998
------------------------------
This proxy statement and the accompanying form of proxy are furnished in
connection with the solicitation of proxies by the Board of Directors of Aramex
International Limited, a Bermuda corporation (the 'Company') to be voted at its
Annual General Meeting of Shareholders which will be held at 10:00 a.m. (local
time), on September 17, 1998 at the Company's corporate headquarters located at
2 Badr Shaker Alsayyab Street, Um Uthayna, Amman, Jordan, and at any
postponements or adjournments thereof (the 'Annual Meeting').
At the Annual Meeting, the Company's shareholders will be asked (i) to
elect Messrs. William S. Kingson and Ayed Al-Jeaid to serve as Class 2 Directors
until the 2002 annual general meeting of shareholders or until their respective
successors are duly elected and qualified, (ii) to ratify the appointment of
Arthur Andersen LLP of Bahrain as the Company's independent public accountants
for the fiscal year ending December 31, 1998, and (iii) to take such other
action as may properly come before the Annual Meeting or any adjournments
thereof.
This proxy statement and the accompanying form of proxy, together with the
Company's 1997 Annual Report to Shareholders, are being mailed to shareholders
on or about August 19, 1998.
GENERAL INFORMATION
SOLICITATION AND VOTING OF PROXIES; REVOCATION; RECORD DATE
Shares represented by each properly executed and returned proxy card will
be voted (unless earlier revoked) in accordance with the instructions indicated.
If no instructions are indicated on the proxy card, all shares represented by
valid proxies received pursuant to this solicitation (and not revoked before
they are voted) will be voted 'FOR' the election of the nominees for director
named below, 'FOR' the ratification of the Company's independent public
accountants and by the proxies in their discretion on any other matters to come
before the Annual Meeting.
A shareholder may revoke a proxy at any time before it is exercised by
filing with the Secretary of the Company a written revocation or a duly executed
proxy bearing a later date or by voting in person at the meeting. Any written
notice revoking the proxy should be sent to the attention of the Assistant
Secretary, Aramex International Limited, 2 Badr Shaker Alsayyab Street, Um
Uthayna, Amman, Jordan, (phone) 5538761, (fax) 5537451 and from the United
States, (phone) 011-962-6-5538761, (fax) 011-962-6-5537451.
Proxies may be solicited by mail, and may also be made by personal
interview, telephone and facsimile transmission, and by directors, officers and
employees of the Company (without special compensation). The expenses for the
preparation of proxy materials and the solicitation of proxies for the Annual
Meeting will be paid by the Company. The Company has retained Continental Stock
<PAGE>
Transfer and Trust Company to assist in the solicitation. In accordance with the
regulations of the Securities and Exchange Commission, the Company will
reimburse, upon request, banks, brokers and other institutions, nominees and
fiduciaries for their expenses incurred in sending proxies and proxy materials
to the beneficial owners of the Company's Common Stock. Expenses for the
solicitation are estimated at approximately $2,500.
Only holders of record of the Company's Common Stock, $.01 par value per
share ('Common Stock'), at the close of business on August 14, 1998 (the 'Record
Date') are entitled to notice of and to vote at the Annual Meeting. As of the
Record Date, there were outstanding 4,929,688 shares of Common Stock. Each share
is entitled to one vote. In order to conduct business at the Annual Meeting, a
quorum must be present; that is a majority of the total number of shares of
Common Stock outstanding as of the Record Date must be represented, either in
person or by proxy.
MATTERS SUBMITTED TO SHAREHOLDERS
ELECTION OF DIRECTORS
(ITEM 1 ON PROXY CARD)
Pursuant to the Company's Bye-laws, the Board of Directors is divided into
three classes and at the Annual Meeting, the shareholders shall elect a
staggered Board of Directors with the terms of the three classes elected to
expire per class over next three succeeding annual general meetings.
At the Annual Meeting, the Company's shareholders will be asked to elect
Messrs. William S. Kingson and Ayed Al-Jeaid to serve as Class 2 Directors until
the 2001 annual general meeting of shareholders or until their respective
successors are duly elected and qualified.
NOMINEES STANDING FOR ELECTION
The following nominees are standing for election to serve as Class 2
Directors to serve until the 2001 annual general meeting of shareholders or
until their respective successors are duly elected and qualified:
William S. Kingson, 58, has been Chairman of the Board and a Class 2
Director of the Company since its incorporation in 1996 and Chairman of the
Board and Director of the Company's predecessor entities since 1982. Mr. Kingson
is also President of New York-based DHX Group Ltd. and Co-Chairman and President
of the Pointe Group.
Ayed Al-Jeaid, 43, has been a Class 2 Director of the Company since April
1997. Mr. Al-Jeaid is Chief Executive Officer of Makshaff Services, Ltd., a
holding company for various aviation and media interests in Saudi Arabia and
worldwide.
Proxies are solicited in favor of the nominees and it is intended that the
proxies will be voted for the nominees unless otherwise specified. Should a
nominee become unable to serve for any reason, unless the shareholders by
resolution provides for a lesser number of directors, the persons named in the
enclosed proxy will vote for the election of a substitute nominee. The Board of
Directors has no reason to believe that the nominees will be unable to serve.
RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION
OF THE DIRECTOR NOMINEES. Assuming the presence of a quorum, the affirmative
vote of a majority of the votes cast by the holders of the shares of Common
Stock present and entitled to vote on this item at the Annual Meeting is
required to elect the nominees. In determining whether this item has received
the requisite number of affirmative votes, abstentions will not be counted and
will have no effect on the result of the
2
<PAGE>
vote, although abstentions will count toward the presence of a quorum. Brokers
who hold shares in street name have the authority to vote on certain routine
matters on which they have not received instruction from the beneficial holders
of such shares. Brokers holding shares in street name, who do not receive
instruction, are entitled to vote on the election of directors, and such broker
votes will count toward the presence of a quorum.
RATIFICATION OF SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
(ITEM 2 ON PROXY CARD)
The Audit Committee has recommended to the Board of Directors of the
Company the selection of Arthur Andersen LLP of Bahrain as independent public
accountants of the Company for the fiscal year ending December 31, 1998.
A representative of Arthur Andersen LLP of Bahrain will be present at the
meeting. The representative will be given the opportunity to make a statement at
the meeting and will be available to respond to appropriate questions.
RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS RATIFY THE
SELECTION OF ARTHUR ANDERSEN LLP OF BAHRAIN TO BE THE INDEPENDENT PUBLIC
ACCOUNTANTS OF THE COMPANY FOR THE FISCAL YEAR ENDING DECEMBER 31, 1998.
Assuming the presence of a quorum, the affirmative vote of a majority of the
votes cast by the holders of the shares of Common Stock present and entitled to
vote on this item at the Annual Meeting is required to ratify the selection. In
determining whether this item has received the requisite number of affirmative
votes, abstentions will not be counted and will have no effect on the result of
the vote, although abstentions will count toward the presence of a quorum.
Brokers who hold shares in street name have the authority to vote on certain
routine matters on which they have not received instruction from the beneficial
holders of such shares. Brokers holding shares in street name, who do not
receive instruction, are entitled to vote on the ratification of the independent
public accountants, and such broker votes will count toward the presence of a
quorum.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS, DIRECTOR NOMINEES,
DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES
The following table sets forth information, to the best of the Company's
knowledge, with respect to the Company's Common Stock, (i) the ownership of
Common Stock by each director of the Company, (ii) the ownership of Common Stock
by all persons who beneficially own 5% or more of the Company's Common Stock,
together with the address of such persons and (iii) the ownership of Common
Stock by all current directors, executive officers and key employees of the
Company as a group. Except as otherwise provided in the footnotes to the table,
the beneficial owners (defined below) have sole voting and investment power as
to all securities. The percentage of shares outstanding is based on the
Company's shares of Common Stock outstanding as of the Record Date.
As used in the table below 'beneficial ownership' means the sole or shared
power to vote or direct the voting or to dispose or direct the disposition of
any security. A person is deemed to have 'beneficial ownership' of any security
that such person has a right to acquire within 60 days of the date of this proxy
statement. Any security that any person named above has the right to acquire
within 60 days is deemed to be outstanding for purposes of calculating the
ownership of such person but is not deemed to be outstanding for purposes of
calculating the ownership percentage of any other person.
3
<PAGE>
Unless otherwise noted, each person listed has the sole power to vote, or direct
the voting of, and power to dispose, or direct the disposition of, all such
shares.
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES TOTAL VOTING
NAME BENEFICIALLY OWNED SHARES
<S> <C> <C>
William S. Kingson* 1,341,500(1) 26.7%
Chairman of the Board and Director
Fadi Ghandour* 1,342,500(2) 26.7%
Deputy Chairman, Chief Executive Officer,
President, Assistant Secretary and Director
Rula Ghandour* 1,342,500(3) 26.7%
Director
Roy Liljebeck 0 --
Director
Ayed Al-Jeaid 0 --
Director
Airborne Freight Corporation* 304,688 6.2%
3101 Western Avenue
Seattle, Washington 98121
All directors, executive officers and key employees 2,720,550(2) 53.0%
as a group (13 persons)(1)(2)(3)
</TABLE>
* Persons designated have entered into a Shareholders Agreement which
provides for certain restrictions on transfer and other rights as
described below in 'Certain Relationships and Related Transactions.'
(1) Includes shares issuable upon currently exercisable incentive stock
options to purchase 100,000 shares of Common Stock at an exercise price
of $7.70, which expire 50 percent in January 2002 and 50 percent in
July 2002. Mr. Kingson's address is c/o Suite 451, 866 United Nations
Plaza, New York, New York 10017.
(2) Includes shares issuable upon currently exercisable nonqualified stock
options to purchase 100,000 shares of Common Stock at an exercise price
of $7.00, which expire 50 percent in January 2007 and 50 percent in
July 2007. In addition, of the reported shares, the amount reported
includes 618,750 shares of Common Stock owned directly by Ms. Rula
Ghandour. Ms. Ghandour is the spouse of Mr. Ghandour, and as such, the
shares held directly by Ms. Ghandour may be deemed beneficially owned
by Mr. Ghandour. Mr. Ghandour's address is in care of the Company at 2
Badr Shaker Alsayyab Street, Um Uthayna, Amman, Jordan.
(3) Of the reported shares, the amount reported includes 623,750 shares of
Common Stock owned directly by Mr. Fadi Ghandour, as well as
nonqualified stock options to purchase 100,000 shares of Common Stock
held directly by Mr. Ghandour. Mr. Ghandour is the spouse of Ms.
Ghandour, and as such, the shares and options held directly by Mr.
Ghandour may be deemed beneficially owned by Ms. Ghandour. Ms.
Ghandour's address is in care of the Company at 2 Badr Shaker Alsayyab
Street, Um Uthayna, Amman, Jordan.
4
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS AND
KEY EMPLOYEES OF THE COMPANY
William S. Kingson, 58, has been Chairman of the Board and a Class 2
Director of the Company since its incorporation in 1996 and Chairman of the
Board and Director of the Company's predecessor entities since 1982. Mr. Kingson
is also President of New York-based DHX Group Ltd. and Co-Chairman and President
of the Pointe Group.
Fadi Ghandour, 39, has been Deputy Chairman, Chief Executive Officer,
President, Assistant Secretary and a Class 3 Director of the Company since its
incorporation in 1996 and Chief Executive Officer, President and Director of the
Company's predecessor entities since 1982.
Rula Ghandour, 39, has been a Class 1 Director of the Company since its
incorporation in 1996 and a Director of the Company's predecessor entities since
1982. Ms. Ghandour has been a principal and manager of Silsal, a Jordan-based
pottery company, for over five years.
Roy Liljebeck, 60, has been a Class 1 Director of the Company since April
1997. Mr. Liljebeck is Executive Vice President and Chief Financial Officer of
Airborne Freight Corporation, having held various management positions with that
organization since he joined in 1967.
Ayed Al-Jeaid, 43, has been a Class 2 Director of the Company since April
1997. Mr. Al-Jeaid is Chief Executive Officer of Makshaff Services, Ltd., a
holding company for various aviation and media interests in Saudi Arabia and
worldwide.
Hazem Malhas, 38, has been Chief Operating Officer since December 1996. Mr.
Malhas served as Vice President and Chief Operating Officer--Express Division of
the Company and its predecessor entities from 1993 until December 1996. Mr.
Malhas joined the Company in 1986. From 1987 to 1993 he served as Vice
President-Operation and Planning, and from 1986 to 1987 he held various
management positions for the Company's Jordan operations.
Safwan Tannir, 49, has been Senior Vice President--Gulf and Indian
Subcontinent since December 1996. Ms. Tannir served as Vice President and Chief
Operating Officer-Freight Division of the Company and its predecessor entities
from 1986 until December 1996.
Camille Tam Nasrallah, 52, has been Vice President--Corporate Affairs of
the Company and its predecessor entities since 1988.
Emad Shishtawi, 40, has been the Vice President--Finance since December
1996. Mr. Shishtawi served as Accounting and Finance Manager of the Company and
its predecessor entities since 1984.
Basem Malhas, 36, has been the Vice President--Information Technolocy since
December 1997. Mr. Malhas served as General Manager of Information from 1992
until 1997 and Jr. Manager from 1989 until 1992.
Iyad Kamal, 30, has been the Quality Assistant Manager since 1995. Mr.
Kamal served as the OEC Coordinator stationed in Jordan from 1992 to 1995.
Bashar Obeid, 26, has been the Group Financial Controller since January
1998. Mr. Obeid started his career with the Company in 1993 as an Acccountant
and was later promoted to Financial Controller.
Yousef Ghandour, 49, has served as Managing Director of the Company's
Middle East Direct/Shop the World Catalog Centers ('MED') responsible for the
MED's implementation and growth strategy since 1994.
5
<PAGE>
Except for Mr. Fadi Ghandour and Ms. Rula Ghandour, who are husband and
wife, and Mr. Yousef Ghandour, who is Mr. Fadi Ghandour's uncle, there are no
family relationships, among directors and executive officers of the Company.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors is composed of five members: Messrs. William S.
Kingson, Fadi Ghandour, Roy Liljebeck and Ayed Al-Jeaid and Ms. Rula Ghandour.
The following are the current members and functions of the standing
committees of the Board of Directors:
Executive Committee. The Executive Committee is authorized and empowered to
exercise all the powers of the Board of Directors between meetings of the Board
of Directors. In addition, the Executive Committee shall have such other
responsibilities as the Board of Directors may assign from time to time. The
Executive Committee is composed of Messrs. Kingson (Chairman) and Ghandour.
Audit Committee. The Audit Committee is authorized to engage the Company's
independent public accountants and review with such public accountants (i) the
scope and timing of their audit services and any other services they are asked
to perform, (ii) their report on the Company's financial statements following
completion of their audit and (iii) the Company's policies and procedures with
respect to internal accounting and financial controls. In addition, the Audit
Committee shall have such other responsibilities as the Board of Directors may
assign from time to time. The Audit Committee is composed of Messrs. Kingson
(Chairman), Ghandour, Liljebeck and Al-Jeaid.
Executive Compensation Committee. The Executive Compensation Committee is
authorized and empowered to approve appointments and promotions of executive
officers of the Company and fix salaries for such officers; provided that all
actions of the Compensation Committee must be ratified by the full Board of
Directors within six months of the subject action. In addition, the Executive
Compensation Committee shall have such other responsibilities as the Board of
Directors may assign from time to time. The Executive Compensation Committee is
composed of Messrs. Kingson (Chairman), Ghandour, Liljebeck and Al-Jeaid.
DIRECTOR, EXECUTIVE OFFICER AND KEY EMPLOYEE COMPENSATION
Directors of the Company currently do not receive any additional
remuneration for services rendered as members of the Board of Directors. All
directors are reimbursed for reasonable expenses incurred in connection with
their services rendered as directors.
During 1997, Mr. Kingson, Chairman of the Board, received no annual
compensation and Mr. Fadi Ghandour, Deputy Chairman, Chief Executive Officer and
President of the Company received annual compensation of $115,000. The aggregate
compensation paid or accrued by the Company and its subsidiaries to all
directors, officers and key employees of the Company who held office at any time
during the fiscal year ended December 31, 1997 (13 persons) was $626,500. No
executive officers are entitled to any pension, retirement or similar benefits
from the Company.
In addition, certain directors and executive officers of the Company earn
compensation through entities which provide services to the Company (See
'Certain Relationships and Related Transactions').
6
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION
COMPENSATION ---------------------
------------ SECURITIES UNDERLYING
NAME AND PRINCIPAL POSITION SALARY OPTIONS
- --------------------------- ------------ ---------------------
<S> <C> <C>
Fadi Ghandour
President, Deputy Chairman, Chief Executive Officer and Assistant
Secretary.................................................................. $115,000 100,000
All Directors, Officers and Key Employees as a Group (13 persons)............ $626,500 300,000
</TABLE>
OPTION GRANTS DURING THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
NUMBER OF % OF TOTAL OF STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM
OPTIONS EMPLOYEES IN EXPIRATION ---------------------------------
NAME GRANTED FISCAL YEAR EXERCISE PRICE DATE 5% 10%
- --------------------------- ---------- ------------ -------------- ---------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
William S. Kingson......... 100,000 33.33% $ 7.70 01/13/02 $123,396 $ 357,357
Fadi Ghandour.............. 100,000 33.33% $ 7.00 01/13/07 $440,223 $ 1,115,618
</TABLE>
AGGREGATED OPTION EXERCISES IN THE FISCAL YEAR ENDED DECEMBER 31, 1997
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SHARES OF COMMON
STOCK VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT DECEMBER 31,
DECEMBER 31, 1997 1997(1)
---------------------------- ----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
William S. Kingson........................................ 100,000 0 $ 730,000 $0.00
Fadi Ghandour............................................. 100,000 0 $ 800,000 $0.00
</TABLE>
- ------------------
(1) Represents the fair market value of the shares of Common Stock underlying
the options as of December 31, 1997, less the exercise price of the options.
EMPLOYMENT AGREEMENTS
In January 1997, the Company and Mr. Kingson entered into a two-year
employment agreement providing for his employment as the Company's Chairman of
the Board at an initial salary of $85,000. At the same time, Mr. Ghandour
entered into a two-year employment agreement providing for his employment as the
Company's President and Chief Executive Officer at a base salary of $115,000.
Each of the employment agreements provide that in the event of termination: (i)
as a result of a major event (defined to include, but not limited to, a change
of control whereby 'any person' (other than persons who beneficially own more
than 30% of the capital stock of the Company on a fully diluted and as converted
basis on the date thereof) becomes the 'beneficial owner' (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of 30% or more of the
Company's outstanding capital stock on a fully diluted and on a converted basis
at such time, the liquidation, dissolution or sale of all or substantially all
of the Company's assets), without cause or by Mr. Kingson or Mr. Ghandour for
good reason (defined to include, but not limited to, a reduction in base salary,
a relocation of the Company's principal executive offices and any material
breach by the Company of any material provision in such employment agreements),
or by Mr. Kingson or Mr. Ghandour for cause,
7
<PAGE>
Mr. Kingson or Mr. Ghandour, as the case may be, will receive a lump sum
severance allowance in an amount equal to 3.0 times his then annual salary; (ii)
as a result of the disability or incapacity of Mr. Kingson or Mr. Ghandour, Mr.
Kingson or Mr. Ghandour, as the case may be, will be entitled to receive 60% of
his salary during the two years following the termination notice; and (iii) as a
result of the death of Mr. Kingson or Mr. Ghandour, Mr. Kingson of Mr. Ghandour
(or their respective estates), as the case may be, will be entitled to receive a
lump sum payment equal to his then annual base salary. Each agreement includes a
one-year non-compete covenant commencing on the termination of employment.
STOCK OPTIONS
On December 19, 1996, the Board of Directors of the Company established the
Aramex International Limited Stock Option Plan (the 'Plan') for employees and
consultants of the Company and its subsidiaries and for nonemployee members of
the Board of Directors of the Company. The Plan permits the granting of both
incentive stock options and nonqualified stock options. A total of 400,000
shares of Common Stock were authorized for issuance under the Plan.
The Plan is administered by a committee of nonemployee members of the Board
of Directors (the 'Committee'). Subject to the terms of the Plan, the Committee
has the sole discretion to determine the persons to whom options will be granted
and the terms and conditions of such options. However, the option price can not
be less than 100% of the fair market value of the Company's Common Stock on the
date of the grant. In the case of an incentive stock option recipient possessing
more than 10% of the total combined voting power of all classes of stock of the
Company or any of its subsidiaries, the option price shall not be less than 10%
of the fair market value of the Company's Common Stock on the date of the grant.
No options were granted in 1996.
On January 13, 1997, Mr. Fadi Ghandour was granted nonqualified options to
purchase 100,000 shares of Common Stock at an option price of $7.00 per share.
The options are exercisable for a period of ten years from the date of vesting.
Fifty percent of these options vested on January 13, 1997 and the other fifty
percent vested on July 13, 1997. On January 13, 1997, Mr. William S. Kingson was
granted incentive stock options to purchase 100,000 shares of Common Stock at an
option price of $7.70 per share. The options are exercisable for a period of
five years from the date of vesting. Fifty percent of these options vested on
January 13, 1997 and the other fifty percent vested on July 13, 1997. Also on
January 13, 1997, stock options to purchase an aggregate of 100,000 shares of
Common Stock at an exercise price equal to $7.00 per share were granted to 139
persons, including the Company's executive officers (other than Messrs. Kingson
and Ghandour), employees and consultants. These options will vest over a
five-year period on the basis of one-quarter each year following the first
anniversary of the grant of such options. (Of these options, options to purchase
25,000 shares of Common Stock were granted to executive officers of the Company,
excluding Messrs. Kingson and Ghandour.)
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As part of the 1996 corporate reorganization (the 'Reorganization') that
resulted in the Company becoming the successor to Aramex Hong Kong, on December
13, 1996 the Company subscribed for 100 Ordinary Shares of Aramex Hong Kong and
each share of Aramex Hong Kong outstanding prior to such subscription was
converted by a special resolution of the shareholders of Aramex Hong Kong into
non-voting deferred shares (the 'Deferred Shares'). The Deferred Shares do not
carry voting rights (other than with respect to resolutions affecting their
class rights) and are effectively subordinated to the Ordinary Shares (all of
which are held by the Company) in respect of all dividends, distributions and
liquidation rights until such as the holders of Ordinary Shares have
8
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received $100 billion. Messrs. Kingson and Ghandour, Ms. Ghandour and Airborne
Freight Corporation in their capacity as Shareholders and Aramex Hong Kong
retain a nominal interest in Aramex Hong Kong through their ownership of the
Deferred Shares.
On October 21, 1996, Aramex Hong Kong sold 195 shares of Common Stock to
the Airborne Freight Corporation ('Airborne') for an aggregate purchase price of
$2,000,000 (the 'Airborne Stock Purchase'). After the Reorganization became
effective, such shares were converted into 304,688 shares of Common Stock of the
Company. In connection with the Airborne Stock Purchase, Mr. William S. Kingson,
Mr. Fadi Ghandour, Ms. Rula Ghandour and Airborne entered into a Shareholders
Agreement, as amended on December 11, 1996 and December 12, 1996, which, among
other things, provides that in the event the Company transfers any shares of
Common Stock to certain listed competitors to Airborne or any other company
primarily engaged in air, freight or in express shipments, Airborne has the
right to sell all of its shares of Common Stock to the Company on the same terms
and conditions as the sale to such other company. In the event that Messrs.
Kingson and Ghandour and/or Ms. Rula Ghandour transfer any shares of Common
Stock to certain listed competitors to Airborne or any other company primarily
engaged in the transportation of air freight or air express shipments, it shall
be a condition of such transfer that Airborne shall be offered the right to sell
to such competitor all of its shares of Common Stock on the same terms and
conditions as the sale by Messrs. Kingson and Ghandour and/or Ms. Rula Ghandour.
'Transfer' is defined to mean the direct or indirect, through intermediaries or
otherwise, sale, transfer, distribution, assignment, bequest, pledge,
hypothecation, encumbrance, grant of security interest in, or grant, issuance,
sale or conveyance of any option, warrant or right to acquire, grant of a proxy
to vote, or other disposition of shares of Common Stock of the Company and is
defined to exclude a sale on the open market or the Transfer of shares by the
Company in connection with a strategic acquisition or similar transaction where
the Company (directly or through one or more subsidiaries) is the acquiring
party. In connection with the Airborne Stock Purchase, Airborne was granted
certain 'piggyback' registration rights relating to their shares of Common
Stock. In addition, under the terms of the Airborne Stock Purchase, Airborne
shall be entitled to appoint one director to the Company's Board of Directors.
On April 23, 1997, Mr. Roy Liljebeck was designated by Airborne to be its Board
designee.
MED was organized under the laws of the Isle of Jersey in 1996. Of the 100
shares of MED currently outstanding, the Company owns 80 shares (5 of which
shares were acquired in connection with the Company's initial public offering
from Mr. Hazem Malhas, the Company's Chief Operating Officer, for nominal
consideration) and Mr. Yousef Ghandour owns 20 shares. Mr. Yousef Ghandour is
Mr. Fadi Ghandour's uncle.
The Company leases the premises currently occupied by the Company's London
operations from Mr. Ali Ghandour, the father of Mr. Fadi Ghandour, at an annual
rental of $88,000. The lease renews annually. The Company believes that the
terms of the lease are at least as favorable to the Company as those available
from unaffiliated third parties.
The Company leases the premises currently occupied by the Company's
corporate offices in Amman, Jordan, from ARAM, an investment company controlled
by the Ghandour family at an annual rental of $106,000, effective January 1,
1998. The lease renews annually. The Company believes the terms and the lease
are at least as favorable to the Company as those available from unaffiliated
third parties. The Company is considering the familiarization of this facility.
In 1997, Mr. Fadi Ghandour personally guaranteed bank overdrafts in Jordan
in the aggregate amount of $205,000.
Ms. Asmahan Abboud, the sister of Fadi Ghandour, is, with her husband, a
50% shareholder in two of the Company's Lebanese subsidiaries. In addition, Ms.
Abboud and her husband own 25% of the outstanding capital stock and the
Company's Lebanese MED subsidiary. Ms. Abboud's interest in
9
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the capital and retained earnings of the Company's Lebanese subsidiaries was
$170,364 for 1997 and $227,828 for 1996. Ms. Abboud and her husband's aggregate
salary from those operations was $96,512 for 1997 and $96,512 for 1996. Ms.
Abboud and her husband received withdrawals from these operations of $80,400 in
1997 and $51,155 in 1996.
The Company has entered into nominee shareholder agreements with Mr. Fadi
Ghandour and Ms. Raghida Ghandour, the sister of Mr. Ghandour, the owners of 78%
an 22% of the share capital of Arab American International Express Company
(Aramex) Limited, the entity through which the Company conducts its Jordanian
operations. Mr. Ghandour and Ms. Ghandour have held their shares in Arab
American International Express Company (Aramex) Limited as nominees for the
Company since inception of its operations on April 3, 1982. However, in January
1995, the Company formalized the arrangement with Mr. Ghandour and Ms. Ghandour
pursuant to nominee shareholder agreements which have been subsequently amended
in connection with the Reorganization. Pursuant to such agreements, Mr. and Ms.
Ghandour confirmed that they are holding their respective shares in the name of
the Company and that they will abide by any written instructions given by the
Company concerning the shares. The Company agreed that they will reimburse and
indemnify Mr. and Ms. Ghandour for all expenses incurred in acquiring and
holding the shares. Arab American International Express Company (Aramex) Limited
has been included in the consolidated financial statements of the Company as a
wholly-owned subsidiary for all periods presented herein.
Except for Mr. Fadi Ghandour and Ms. Rula Ghandour, who are husband and
wife, and Mr. Yousef Ghandour, who is Mr. Ghandour's uncle, there are no family
relationships, among directors and executive officers of the Company.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1998 Annual Meeting
of Shareholders must be received by the Company at the address appearing on the
first page of this proxy statement by June 30, 1998 in order to be considered
for inclusion in the Company's proxy statement and form of proxy relating to
that meeting.
OTHER BUSINESS
The Board of Directors of the Company is not aware of any other matters to
come before the Annual Meeting. If any other matter should come before the
meeting, the persons named in the enclosed proxy intend to vote the proxy
according to their best judgment.
10
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ARAMEX INTERNATIONAL LIMITED
PROXY SOLICITED BY THE BOARD DIRECTORS
The undersigned, hereby appoints William S. Kingson, Chairman of the Board of
Directors of Aramex International Limited, a Bermuda corporation (the
'Company'), and Fadi Ghandour, Deputy Chairman, Chief Executive Officer and
President of the Company, and each of them, as proxies for the undersigned, each
with full power of substitution, for and in the name of the undersigned to act
for the undersigned and to vote, as designated below, all of the shares of
common stock, $.01 par value per share, of the Company that the undersigned is
entitled to vote at the 1998 Annual General Meeting of Shareholders of the
Company, to be held on September 17, 1998, at 10:00 a.m. (local time), at the
Company's corporate headquarters located at 2 Badr Shaker Alsayyab Street, Um
Uthayna, Amman, Jordan, and at any adjournments or postponements thereof, in
accordance with the directions as follows with respect to the following matters:
ITEM 1. Approve election of Class 2 Director Nominees: William S. Kingson
and Ayed Al-Jeaid.
ITEM 2. Ratify appointment of Arthur Andersen LLP of Bahrain as the
independent public accountants of the Company for the fiscal year
ending December 31, 1998.
ITEM 3. Such other matters as may properly come before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2: Please mark
your votes as in this example /x/.
1. ELECTION OF CLASS 2 DIRECTORS:
William S. Kingson / / FOR / / AGAINST / / ABSTAIN
Ayed Al-Jeaid / / FOR / / AGAINST / / ABSTAIN
- --------------------------------------------------------------------------------
<PAGE>
2. To ratify the appointment of Arthur Andersen LLP of Bahrain as the
independent public accountants of the Company for the fiscal year ending
December 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the meeting.
This proxy will be voted as
directed. Unless otherwise
directed, this Proxy will be voted
for Proposals 1 and 2.
Dated: ______________________, 1998
___________________________________
Shareholder sign here
___________________________________
Co-owner sign here
NOTE: Please sign exactly as the
name appears on this card. When
shares are held by joint tenants,
both should sign. When signing as
attorney, executor, administrator,
trustee or guardian, please give
full title as such. If a
corporation, please sign in full
corporate name by president or
other authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN
YOUR PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE SO THAT YOUR VOTE WILL BE
COUNTED.
