SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
JLM INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
[LOGO]
JLM INDUSTRIES, INC.
8675 Hidden River Parkway
Tampa, FL 33637
July 8, 1999
Dear Stockholder:
You are cordially invited to attend the 1999 Annual Meeting (the
"Meeting") of stockholders of JLM Industries, Inc. (the "Company"). The Meeting
will be held August 12, 1999, at 11:00 a.m., Eastern Standard Time, at The
Radisson Hotel, located at 10221 Princess Palm Avenue, Tampa, Florida, 33610.
The Notice of the Meeting and the Proxy Statement on the following
pages cover the formal business of the Meeting, which includes the election of
Directors, a proposal to ratify the appointment of the Company's independent
certified public accountants and a proposal to amend the Company's Non-Employee
Directors' Stock Option Plan.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. WE ASK
THAT YOU PROMPTLY SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED, EVEN IF YOU PLAN TO ATTEND THE MEETING. RETURNING YOUR PROXY TO US
WILL NOT PREVENT YOU FROM VOTING IN PERSON AT THE MEETING IF YOU ARE PRESENT AND
CHOOSE TO DO SO.
If your shares are held in street name by a brokerage firm, your broker
will supply you with a Proxy to be returned to the brokerage firm. It is
important that you return the form to the brokerage firm as quickly as possible
so that the brokerage firm may vote your shares. You may not vote your shares in
person at the Meeting unless you obtain a power of attorney or legal Proxy from
your broker authorizing you to vote the shares and you present this power of
attorney or Proxy at the Meeting.
On behalf of the Board of Directors and management of the Company, I
want to thank you for your support and confidence in us and I look forward to
greeting you personally at the Meeting.
Sincerely,
/s/ JOHN L. MACDONALD
-------------------------------
John L. Macdonald
Chairman of the Board and Chief
Executive Officer
<PAGE>
JLM INDUSTRIES, INC.
8675 Hidden River Parkway
Tampa, FL 33637
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON THURSDAY, AUGUST 12, 1999
Notice is hereby given that the Annual Meeting of Stockholders of JLM
Industries, Inc. (the "Company"), a Delaware corporation, will be held at The
Radisson Hotel, 10221 Princess Palm Avenue, Tampa, Florida 33610, on August 12,
1999, at 11:00 a.m., Eastern Standard Time (the "Meeting") for the following
purposes:
1. To elect Directors to serve until the next Annual Meeting of
Stockholders in 2000;
2. To ratify the appointment of Deloitte & Touche LLP as the
Company's independent auditors for fiscal year 1999;
3. To approve an amendment to the Company's Non-Employee
Directors' Stock Option Plan; and
4. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
Your attention is directed to the Proxy Statement accompanying this
Notice for a more complete description of the matters to be acted upon at the
Meeting. Stockholders of record at the close of business on July 7, 1999 are
entitled to receive notice of and to vote at the Meeting and any adjournment
thereof.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. WHETHER
OR NOT YOU EXPECT TO ATTEND, PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED TO ENSURE THE PRESENCE OF A QUORUM. You may
revoke your Proxy and vote in person at the Meeting, if you desire. If your
shares are held in street name by a brokerage firm, your broker will supply you
with a Proxy to be returned to the brokerage firm. It is important that you
return the form to the brokerage firm as quickly as possible so that the
brokerage firm may vote your shares. You may not vote your shares in person at
the Meeting if your shares are held in street name by a brokerage firm unless
you obtain a power of attorney or legal Proxy from your broker authorizing you
to vote the shares and you present this power of attorney or Proxy at the
Meeting.
Please note that attendance at the Meeting will be limited to
stockholders of the Company as of the record date (or their duly authorized
representatives). If your shares are held by a bank or broker, please bring to
the Meeting your bank or broker statement evidencing your beneficial ownership
of Company stock as of the record date, July 7, 1999.
By Order of the Board of Directors,
/s/ MICHAEL J. MOLINA
-------------------------------
Michael J. Molina
Vice President and Secretary
Tampa, Florida
July 8, 1999
<PAGE>
JLM INDUSTRIES, INC.
8675 Hidden River Parkway
Tampa, FL 33637
PROXY STATEMENT
1999 ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished by the Board of Directors and
management of JLM Industries, Inc., (the "Company) in connection with the
solicitation of proxies to be voted at the Company's 1999 Annual Meeting of
Stockholders, which will be held at 11:00 a.m. Eastern Standard Time on
Thursday, August 12, 1999, at The Radisson Hotel, 10221 Princess Palm Avenue,
Tampa, Florida 33610 (the "Meeting). The Meeting is the Company's second Annual
Meeting of Stockholders since the completion of its initial public offering of
Common Stock on July 24, 1997 (the "Offering").
Any Proxy delivered pursuant to this solicitation may be revoked, at
the option of the person executing the Proxy, at any time before it is
exercised, by delivering a signed revocation to the Company, by submitting a
later-dated Proxy or by attending the Meeting in person and casting a ballot. If
proxies are signed and returned without voting instructions, the shares
represented by the proxies will be voted as recommended by the Board of
Directors.
The cost of soliciting proxies will be borne by the Company. In
addition to the use of the mails, proxies may be solicited personally or by
telephone by regular employees of the Company. The Company does not expect to
pay any compensation for the solicitation of proxies, but may reimburse brokers
and other persons holding stock in their names, or in the names of nominees, for
their expense in sending Proxy materials to the actual beneficial owner and
obtaining their proxies.
The approximate date on which this Proxy Statement and enclosed form of
Proxy has been first mailed to shareholders is July 15, 1999.
The Company has common stock with a par value $.01 per share (the
"Common Stock") that is the only outstanding voting security of the Company.
Employees of the Company will tabulate all votes and will serve as inspectors of
elections.
The close of business on Monday, July 7, 1999 has been designated as
the record date for the determination of stockholders entitled to receive notice
of and to vote at the Meeting. As of July 7, 1999, 6,657,255 shares of the
Company's Common were issued and outstanding, each of which is entitled to one
vote. Each stockholder will be entitled to one vote for each share of Common
Stock registered in his or her name on the books of the Company as of the close
of business on Monday, July 7, 1999, on all matters that come before the
Meeting.
<PAGE>
1. ELECTION OF DIRECTORS - ITEM ONE ON YOUR PROXY CARD
There are currently seven seats on the Board of Directors of the
Company, with no vacancies. Directors are elected to their positions until the
next Annual Meeting of Stockholders, and until their respective successors are
elected and qualified or until their earlier resignation, removal from office or
death. The Board of Directors recommends that seven of the current Directors be
re-elected at the Meeting to hold office until the Company's next Annual Meeting
of Stockholders in 2000, and until their successors shall be duly elected and
qualified or until their earlier resignation, removal from office or death.
The Board of Directors has nominated the following seven persons to
stand for re-election at the 1999 Annual Meeting of Stockholders:
John L. Macdonald
Frank A. Musto
Walter M. Tarpley
Sean D. Macdonald
Jerry L. Weinstein
Thomas F. Kennedy
Charles N. Neivert
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
RE-ELECTION OF MESSRS. J. MACDONALD, MUSTO, TARPLEY, S. MACDONALD, WEINSTEIN,
KENNEDY AND NEIVERT AS DIRECTORS, TO SERVE TERMS AS DESCRIBED ABOVE. For further
information on such nominees see "MANAGEMENT - DIRECTORS AND EXECUTIVE OFFICERS"
and "SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS."
The nominees that receive a majority of the votes cast by the shares
entitled to vote at the Meeting shall be elected. Abstentions will be counted
toward the number of shares represented at the Meeting. Broker non-votes will be
disregarded. Stockholders may not vote cumulatively in the election of
Directors.
The proposed nominees for election as Directors are willing to be
elected as such. In the unanticipated event any of the nominees should be unable
to serve, Proxies may be voted for such other person or persons for the office
of Director as the Board of Directors may select.
<PAGE>
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the names and ages of the Directors,
nominees for Directors and executive officers of the Company and the positions
they hold with the Company. Executive officers serve at the pleasure of the
Board of Directors.
<TABLE>
<CAPTION>
DIRECTOR
DIRECTORS AND EXECUTIVE OFFICERS AGE POSITIONS SINCE
-------------------------------- --- --------- --------
<S> <C> <C> <C>
John L. Macdonald 56 President, Chief Executive Officer
& Director 1986
Thaddeus J. Lelek 50 Vice President
Wilfred J. Kimball 60 Vice President
Frank A. Musto 42 Vice President, Chief Financial Officer
& Director 1997
Walter M. Tarpley 54 Vice President & Director 1999
John T. White 68 Vice President & General Counsel
Michael J. Molina 47 Vice President - Tax and Audit
& Secretary
Linda L. Sato 38 Vice President & Treasurer
Sean D. Macdonald 28 Vice President & Director 1999
Jerry L. Weinstein 63 Director 1997
Thomas F. Kennedy 56 Director 1999
Charles N. Neivert 41 Director 1999
</TABLE>
JOHN L. MACDONALD founded the Company in April 1986, and has served as
the President, Chief Executive Officer and a director of the Company throughout
its history. Mr. Macdonald also co-founded Gill and Duffus Chemical, Inc., in
1978 and served as its President and Chief Executive Officer until the
conclusion of a leveraged buyout in 1983, in which Gill and Duffus Chemical,
Inc., merged with the Steuber Company, Inc. Mr. Macdonald received a B.A. from
Colorado College and has more than 29 years experience in the chemical industry.
THADDEUS J. LELEK has been with the Company since its formation in
1986, serving in a variety of senior marketing positions. In 1986, he was
elected Vice President of JLM Marketing. Mr. Lelek has more than 28 years of
experience in the chemical industry. Mr. Lelek is principally responsible for
formulating and implementing the Company's marketing strategies and programs for
North American sales. From 1983 to 1986, Mr. Lelek was also responsible for
marketing in North America for Steuber Company, Inc., and from 1980 to 1983, Mr.
Lelek headed up the national sales effort for distribution for Gill and Duffus
Chemicals, Inc. Mr. Lelek was also employed in various capacities, including
National Sales Manager for certain products, for Gulf Oil Chemicals, Inc., from
1970 to 1979. Mr. Lelek graduated with a B.S. in Chemical Engineering from
Worchester Polytechnic Institute.
WILFRED J. KIMBALL was hired as Vice President of JLM Chemicals and
Vice President of the Company following the acquisition by the Company in 1995
of the Blue Island Plant from BTL Specialty Resins Corp. ("BTL Corporation").
Mr. Kimball is primarily responsible for the operation of the Company's Blue
Island Plant. In addition, he is responsible for the operations of JLM Terminals
and the day-to-day direction of certain of the Company's sales force and support
staff. From 1990 to 1995, Mr. Kimball was President of BTL Corporation and in
this capacity was primarily responsible for the Blue Island Plant. From 1985 to
1990, Mr. Kimball served in various executive capacities with BTL Corporation,
including Vice President of Manufacturing and Engineering, and President of
Plyophen Chemicals, a division of BTL Corporation. Prior to 1985, Mr. Kimball
served for 22 years in various capacities with Union Carbide Canada LTD. Mr.
Kimball received a B.S. in Chemical Engineering from the University of
Brunswick.
FRANK A. MUSTO has been with the Company since its formation in 1986.
Mr. Musto was elected Vice President and Chief Financial Officer in 1994. Mr.
Musto is principally responsible for the Company's banking relationships,
current cash management systems, and investment of excess funds. Prior to
joining the Company, from 1979 to 1981, and from 1983 to 1985, Mr. Musto was the
Marine Accountant, Controller and Treasurer for the Steuber Company, Inc. From
1981 to 1982,
<PAGE>
Mr. Musto was the controller for Amerpol International, New York City, a custom
house broker, freight forwarder, and agent for the government-controlled fishing
fleet in Poland. Mr. Musto graduated from Bernard M. Baruch College with a
B.B.A. in Accounting.
WALTER M. TARPLEY started with the Company in January 1999 as President
of the Company's North American Division and Vice President of JLM Industries,
Inc. Prior to joining the Company, Mr. Tarpley served as Vice President and
General Manager of Ashland Chemical Company's Industrial Chemicals & Solvents
Division, the United States' largest distributor of performance chemicals and
additives. Mr. Tarpley served 26 years with Unocal Chemicals in various General
Management positions and joined Ashland in 1993 in a merger of these firms. Upon
joining Ashland, Mr. Tarpley was named Business Director for the IC&S Divisions
Coatings, Adhesives and Inks business. In this capacity, Mr. Tarpley also
managed the Divisions' International Group and Technical Services Laboratories.
Mr. Tarpley received a B.S. in Marine Biology from the University of Miami. Mr.
Tarpley was elected to the Board of Directors on July 2, 1999 to fill the
vacancy created by the resignation of Mr. Lelek.
JOHN T. WHITE has served as Vice President and General Counsel of the
Company since 1990. Mr. White is the Company's chief legal officer and is
principally responsible for the legal affairs of the Company and its
consolidated subsidiaries. From 1987 to 1989, Mr. White was Senior Vice
President for Paribas Corporation, a North American investment banking firm.
From 1970 to 1987, Mr. White was partner with the New York City law firm of
Wender, Murase and White. From 1962 to 1970, Mr. White was a partner in the
international law firm of Baker & McKenzie, resident in the firm's New York City
office. Mr. White received a bachelor's degree from Harvard College, a Juris
Doctorate from Columbia University and an L.L.M. from New York University.
MICHAEL J. MOLINA joined the Company in 1986 as Controller. In 1995, he
was promoted to his current position as Vice President - Tax and Audit. Mr.
Molina is primarily responsible for taxes, audits and management information
systems. From 1992 to 1995, Mr. Molina served as Vice President of
Administration. Mr. Molina received a B.A. from Johns Hopkins University and an
M.B.A. from Pace University.
LINDA L. SATO has been employed by the Company since 1986 when she was
hired as the Company's Assistant Controller. In 1994, she was appointed Vice
President and Controller. In 1996, Ms. Sato was promoted to Vice President and
Treasurer. Ms. Sato graduated from the University of Connecticut with a B.A. in
Accounting.
SEAN D. MACDONALD joined the Company in May 1994 and worked as a sales
representative in the Company's Southwest region until January 1997. In January
1997, Mr. Macdonald was relocated to the Company's Dutch subsidiary, JLM
Industries (Europe) B.V. in the olefins trading group. In November 1997, Mr.
Macdonald was appointed Managing Director of JLM Industries (Europe) B.V. in
order to facilitate the integration of the Tolson acquisition. Mr. Macdonald was
transferred to the Company's Singapore operation, JLM Chemicals (Asia) Pte. Ltd.
in November 1998. In April 1999, Mr. Macdonald was appointed Vice President
International and transferred to the Company's headquarters in Tampa. Mr.
Macdonald received a B.A. in political science and a minor in international
marketing from the University of Tampa. Mr. Macdonald was elected to the Board
of Directors on July 2, 1999 to fill the vacancy created by the resignation of
Mr. Kimball.
JERRY L. WEINSTEIN served as Vice President of Owens Corning -
Specialty & Foam Products Division since 1994. From 1980 until 1994, Mr.
Weinstein was President and Chief Executive Officer of UC Industries, Inc., an
independent manufacturer of plastic products for the building materials
industry.
THOMAS F. KENNEDY joined the Board of Directors of the Company in
January 1999. Prior to joining the Board, Mr. Kennedy served as President and
Chief Executive Officer of Hoechst Celanese ("Hoechst") from January 1996 until
his retirement in March 1998. Mr. Kennedy joined Hoechst in 1966 and held
various sales and marketing positions with the company including Vice President
and General Manager of the Filter Products Division of Celanese Fibers
Operations. Mr. Kennedy became Executive Vice President of Celanese Chemical
Company in 1986 and President of Hoechst Celanese Chemical Group in 1989, which
included responsibility for overseeing the Textile Fibers, Technical Fibers
Polyester Resins and Films and Specialty Chemicals groups.
Charles N. Neivert was elected to the Board of Directors on July 2,
1999 to fill the vacancy created by the resignation of Mr. Kahn. In 1992, Mr.
Neivert Co-founded and is currently the Chief Operating Officer of New Vernon
Associates, which is an investment advisory boutique focusing on select global
chemical, life science and pharmaceutical companies. From 1987 to 1992, Mr.
Neivert was the Vice President and Senior Sector Analyst of Anantha Raman &
Company, Inc., a leading equity research boutique. From 1980 until 1986, Mr.
Neivert worked with Data Resources, Inc. as a Manager and Economist wherein he
developed, designed and marketed new computer-based forecasting and cost models
for the chemical industry. Mr. Neivert is a candidate for his M.B.A. at Rutgers
University and received his B.A. from the University of Pennsylvania in
Economics and Chemistry.
<PAGE>
Sean D. Macdonald is the son of the Company's President and Chief
Executive Officer, John L. Macdonald. None of the other executive officers or
directors are related to one another. Executive officers are elected by and
serve at the discretion of the Board of Directors.
MEETINGS OF THE BOARD OF DIRECTORS AND STANDING COMMITTEES
The Board of Directors held two formal meetings during 1998. Each of
the incumbent Directors attended at least 75% of the aggregate of all meetings
of the Board and all committees of which he was a member. All other actions
during such year were accomplished through unanimous written consents without a
meeting of the Directors.
The Board of Directors has a standing Audit Committee and Compensation
Committee; it does not have a Nominating Committee. The Board of Directors
functions as a Nominating Committee, and the Board will consider written
recommendations from stockholders for positions on the Board of Directors in
accordance with the procedures set forth in the Amended and Restated Articles of
Incorporation of the Company. See "Stockholder Proposals For Presentation at the
2000 Annual Meeting" for further information.
The Audit Committee held one meeting prior to the Meeting. Until July
2, 1999, the Audit Committee consisted of Messrs. Kimball, Kahn and Weinstein.
On July 2, 1999, Messrs. Kimball and Kahn resigned as Directors and as members
of the Audit Committee and the Board of Directors appointed Messrs. Neivert and
Tarpley as their replacement. The Audit Committee recommends the appointment of
the independent public accountants of the Company, discusses and reviews the
scope and fees of the prospective annual audit, and reviews the results thereof
with the independent public accountants, reviews and approves non-audit services
of the independent public accountants, reviews compliance with existing major
accounting and financial policies of the Company, reviews the adequacy of the
financial organization of the Company, reviews management's procedures and
policies relative to the adequacy of the Company's internal accounting controls
and compliance with federal and state laws relating to accounting practices, and
reviews and approves (with the concurrence of the majority of the disinterested
Directors of the Company) transactions, if any, with affiliated parties.
The Compensation Committee held one meeting in 1998. Until July 2,
1999, the Compensation Committee consisted of Directors, Messrs. Kahn, Weinstein
and Kennedy. On July 2, 1999, Mr. Kahn resigned as a Director and as a member of
the Compensation Committee and the Board of Directors appointed Mr. Neivert to
fill the vacancy on the Compensation Committee. The Compensation Committee's
principal function is to make recommendations to the Board of Directors with
respect to the compensation and benefits to be paid to officers and perform
other duties prescribed by the Board with respect to employee stock plans and
benefit programs.
See "CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS" for
additional information on certain members of management.
COMPENSATION OF DIRECTORS
Base Compensation. In fiscal 1998, non-employee directors received an
annual retainer fee of $10,000 plus $2,500 for each committee meeting physically
attended or held by telephone and whether or not coinciding with a Board
meeting. In addition, all directors were entitled to receive reimbursement of
reasonable out-of-pocket expenses incurred in connection with meetings of the
Board of Directors or committees thereof; no additional per meeting fees were
paid.
Options. Pursuant to the Non-Employee Directors' Stock Option Plan, as
amended in January 1999, each non-employee director receives an automatic grant
of options to purchase 5,000 shares of Common Stock upon their initial
appointment to the Board of Directors and 2,500 shares of Common Stock upon
their reelection to the Board of Directors. In general, each option granted
under the plan vests in full on the date of the next annual meeting following
the date of grant, has a five year term and permits the holder to purchase
shares at their fair market value on the date of grant. The Board of Directors
may also make discretionary grants of options under the plan.
Prior to the amendment to the plan, Messrs. Kahn and Weinstein were
each granted an option to purchase 1,000 shares of Common Stock upon their
initial appointment to the Board and an option to purchase 1,000 shares of
common stock following the 1998 Annual Meeting of Stockholders. In connection
with the amendment to the plan in January 1999 and in order to make the prior
grants to Messrs. Kahn and Weinstein consistent with terms of the amended plan,
Messrs. Kahn and Weinstein were each granted an option to purchase 1,500 shares
of Common Stock and an option to purchase 4,000 shares of Common Stock. Also, in
January 1999, Mr. Kennedy, upon his initial appointment to the Board of
Directors, was granted an option to purchase 5,000 shares of Common Stock.
<PAGE>
For additional information regarding the Non-Employee Directors' Stock
Option Plan and the amendment to the plan previously approved by the Board of
Directors and being submitted to the stockholders of the Company pursuant to
this proxy statement, see Proposal to Approve the Amendment of the Non-employee
Directors' Stock Option Plan - Item Three on Your Proxy Card
Indemnification. The Company indemnifies its directors and officers to
the fullest extent permitted by law so that they will serve free from undue
concern that they will not be indemnified. Each of the Company's directors and
executive officers have entered into indemnification agreements with the
Company.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, officers and holders of more than 10% of the Company's
Common Stock to file with the Securities and Exchange Commission initial reports
of ownership and reports of changes in ownership of Common Stock and any other
equity securities of the Company. The Company did not become subject to such
requirements until the Offering. To the Company's knowledge, based solely upon a
review of the forms, reports, and certificates furnished to the Company by such
persons during the most recently completed fiscal year, all such reports were
filed on a timely basis except for Forms 3 to report the election of Mr. Kennedy
as a Director and Mr. S. Macdonald for his election as Vice President were each
filed late.
SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of July 7, 1999, for (i)
each person known by the Company to own beneficially more than 5% of the
outstanding Common Stock, (ii) each Director and Nominee for Director of the
Company, (iii) each of the Named Executive Officers and (iv) all Executive
Officers and Directors as a group.
NUMBER PERCENT
BENEFICIALLY OF
NAME OF BENEFICIAL OWNER OWNED (1) CLASS
------------------------ ------------ -------
John L. Macdonald 4,305,614 (2) 64.7
Maxwell Stolzberg, as Trustee of an
Irrevocable Trust 4,096,608 (2) 61.5
Thaddeus J. Lelek 23,900 (3) *
Wilfred J. Kimball 12,520 (3) *
Frank A. Musto 23,150 (3) *
Walter M. Tarpley 37,200 (3) *
Sean D. Macdonald 10,233 (3) *
John T. White 6,000 (4) *
Jerry L. Weinstein 7,500 (5) *
Thomas F. Kennedy - *
Charles N. Neivert - *
Brinson Partners 473,600 (6) 7.1
All Directors, Nominees, for Directors and
Executive Officers As a Group (11 persons) 4,433,617 66.6
*Less than one percent ownership
(1) Beneficial ownership of shares, as determined in accordance with applicable
Securities and Exchange Commission rules, includes shares to which a person
has or shares voting power and/or investment power and any shares as of a
given date which such persons has the right to acquire within 60 days after
such date. Except as otherwise indicated, all shares are held of record
with sole voting and investment power.
(2) Of the shares shown for Mr. Macdonald and Mr. Stolzberg, as Trustee,
4,096,608 shares are held of record by an Irrevocable Trust of which Mr.
Stolzberg is Trustee and Mr. Macdonald is the grantor and sole beneficiary.
Under terms of the Irrevocable Trust, Mr. Stolzberg, as Trustee, has the
full and exclusive right and power to vote and dispose of all shares of the
Common Stock held by the Irrevocable Trust. However, as a result of Mr.
Macdonald's right to terminate the Irrevocable Trust by providing written
notice at certain specified times and acquire beneficial ownership of the
shares of Common Stock held by the Irrevocable Trust, Mr. Macdonald and the
Trustee may be deemed to share voting and
<PAGE>
investment control with respect to the shares of Common Stock held by the
Irrevocable Trust. For Mr. Macdonald, the number of shares include 167,040
shares of Common Stock held by two irrevocable trusts created for the
benefit of Mr. Macdonald's children for which Mr. Macdonald disclaims
beneficial ownership. Additionally, Mr. Macdonald's shares include 41,666
shares deemed to be beneficially owned by Mr. Macdonald by virtue of
certain stock options that are currently exercisable. The address for Mr.
Macdonald is 8675 Hidden River Parkway, Tampa, Florida 33637 and the
address of Mr. Stolzberg is 460 Park Avenue, New York, New York 10022.
(3) For each of Messrs. Lelek, Kimball and Musto, the number of shares shown
includes 10,000 shares deemed to be beneficially owned by each such officer
by virtue of certain stock options that are currently exercisable. For Mr.
Lelek, Kimball and Musto, the number also includes 12,900, 1,720 and 12,900
shares, respectively, related to the vesting of restricted shares.
Additionally, the number includes for Mr. Lelek, Kimball and Musto 1,000,
800 and 250 shares, respectively, that each owns personally. The shares for
Mr. Tarpley represent 37,200 shares relate to the vesting of restricted
stock. The shares for Sean Macdonald represent 6,900 shares owned
personally and 3,333 stock options that are currently exercisable.
(4) The number of shares shown includes 5,000 shares deemed to be beneficially
owned by Mr. White by virtue of certain stock options that are currently
exercisable. Additionally, the number includes 1,000 shares that Mr. White
owns personally.
(5) For Mr. Weinstein, the number of shares shown reflects 7,500 shares deemed
to be beneficially owned by him by virtue of certain stock options that are
currently exercisable or will become exercisable in 60 days.
(6) This information is derived from a Schedule 13G/A dated February 17, 1999
filed jointly by Brinson Partners, Inc. ("BPI") and UBS AG ("UBS"). BPI and
UBS may be deemed the beneficial owners with respect to all of the shares
shown, with shared voting and dispositive power as to all such shares. The
address of BPI is 209 South LaSalle Street, Chicago, Illinois 60604-1295
and the address of UBS is Bahnhofstrasse 45, 8021, Zurich, Switzerland.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth all compensation awarded to, earned by,
or paid for services rendered to the Company in all capacities during the years
ended December 31, 1996, 1997 and 1998 for each of the named executive officers
(as defined under applicable Securities and Exchange Commission Rules) of the
Company (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------ ------------------------------------------
RESTRICTED
NAME STOCK ALL OTHER
AND SALARY BONUS AWARDS COMPENSATION
POSITION YEAR ($) ($) ($)(2) OPTIONS (#) ($)(1)
-------- ---- -------- -------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
John L. Macdonald 1998 $410,769 $180,000 - - $23,271
President & CEO 1997 401,541 200,000 - 125,000 17,056
1996 168,486 250,000 - - 9,486
Thaddeus J. Lelek 1998 138,634 22,500 - - 13,588
Vice President 1997 129,803 12,500 150,000 30,000 3,588
1996 108,333 10,000 - - -
Wilfred J. Kimball 1998 136,437 20,000 - - 12,694
Vice President 1997 136,437 22,000 20,000 30,000 15,266
1996 135,483 15,000 - - 39,141
Frank A. Musto 1998 128,365 25,000 - - 12,400
Vice President & CFO 1997 121,274 27,000 150,000 30,000 15,841
1996 91,683 26,000 - - 9,500
John T. White 1998 123,759 11,000 - 5,000 16,861
Vice President & 1997 114,462 27,500 - 15,000 11,888
General Counsel 1996 113,866 27,500 - - -
</TABLE>
<PAGE>
(1) Amounts in 1998, for Mr. Macdonald consists of $10,000 contributed to the
Company's Defined Contribution Plan, $6,580 for a car allowance and $5,185
which is the dollar value, on a term loan, of the benefit to Mr. Macdonald
of the $248,941 premium paid by the Company during 1998 for a split-dollar
life insurance plan covering Mr. Macdonald and his wife. Under the terms of
the split dollar life insurance agreement, the Company has the right to
recover all of the premiums paid by the Company under the agreement. Amount
in 1998 for Mr. Lelek consists of the amounts contributed by the Company to
the Company's Defined Contribution Plan $10,000 and $3,558 for car
allowance. Amount for Mr. White in 1998, consists of a car allowance of
$8,359 and $8,502 that was contributed by the Company to the Company's
Defined Contribution Plan. Amount for Mr. Kimball in 1998 consists of
$3,000 car allowance and $9,694 contributed by the Company to the Company's
Deferred Plan. Amount for Mr. Musto in 1998 consists of $2,400 of car
allowance and $10,000 contributed by the Company to the Company's Defined
Contribution Plan.
(2) The aggregate restricted stock holdings and value of such holdings at
December 31, 1998 for Mr. Lelek were 13,950 shares and $71,494,
respectively, for Mr. Kimball were 1,860 shares and $3,953, respectively,
and for Mr. Musto were 13,950 shares and $71,494, respectively. The shares
of restricted stock are subject to a substantial risk of forfeiture that
lapses as to one-quarter of the shares each January 1st, commencing on
January 1, 1998. Dividends on all restricted shares issued to the named
executive officers are paid at the same rate as paid to all stockholders.
The Company currently intends to retain all future earnings for the
development of its business and does not anticipate paying cash dividends
for the foreseeable future.
STOCK OPTION GRANTS
The following table summarizes certain information concerning stock
options granted during fiscal year 1998 to the Named Executive Officers:
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES OF
INDIVIDUAL GRANTS STOCK PRICE APPRECIATION
FOR OPTION TERM
- ---------------------------------------------------------------------- --------------------------
% OF TOTAL
OPTIONS
GRANTED TO EXERCISE
EMPLOYEES IN OR BASE
OPTIONS FISCAL PRICE EXPIRATION
NAME GRANTED(#) YEAR ($/SHARE) DATE 5% ($) 10% ($)
---- ---------- ------------ --------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
John T. White 5,000 83% 10.5 10/31/08 14,505 32,052
</TABLE>
No other Named Executive Officer received stock options during 1998.
<PAGE>
The following table provides information regarding the exercise of
stock options during fiscal year 1998 and stock options held as of the end of
fiscal year 1998 by the Named Executive Officers:
AGGREGATED OPTION EXERCISE
AND YEAR END OPTIONS VALUE TABLE
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS
AT FISCAL YEAR END AT FISCAL YEAR END (1)
----------------------------- -----------------------------
SHARES
ACQUIRED
ON VALUE
NAME EXERCISE REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
John L. Macdonald 0 $0 41,667 83,333 $0 $0
Thaddeus J. Lelek 0 0 10,000 20,000 0 0
Wilfred J. Kimball 0 0 10,000 20,000 0 0
Frank A. Musto 0 0 10,000 20,000 0 0
John T. White 0 0 5,000 20,000 0 0
<FN>
(1) THIS REPRESENTS THE AMOUNT BY WHICH THE FAIR MARKET VALUE OF THE
COMPANY'S COMMON STOCK OF $5.125 PER SHARE AS OF DECEMBER 31, 1998
EXCEEDED THE EXERCISE PRICE OF THE OPTIONS HELD BY THE NAMED EXECUTIVE
OFFICERS.
</FN>
</TABLE>
THE INFORMATION CONTAINED IN THE FOLLOWING SECTIONS ENTITLED "REPORT OF
THE COMPENSATION COMMITTEE" AND "PERFORMANCE GRAPH" ARE NOT DEEMED TO BE
"SOLICITING MATERIAL" OR TO BE "FILED" WITH THE COMMISSION OR SUBJECT TO
REGULATION A UNDER THE SECURITIES ACT OF 1933, OR TO THE LIABILITIES OF SECTION
18 OF THE SECURITIES EXCHANGE ACT OF 1934.
REPORT OF THE COMPENSATION COMMITTEE
The following report was prepared as of the date of this Proxy
statement by Directors Neivert, Weinstein and Kennedy, as the members of the
Company's Compensation Committee that was formed after the Company's July 24,
1997, Offering. Mr. Kahn was a member of the compensation committee until his
resignation from the Board of Directors on July 2, 1999 at which time Mr.
Neivert was appointed to fill the vacancy.
The duties of the Compensation Committee (the "Committee") include the
review of compensation levels of the Company's executive officers, the
evaluation of the performance of the executive officers and the administration
of any stock-based compensation plans except the Non-Employee Directors' Stock
Plan.
GENERAL POLICIES
The Company's executive compensation system, which is set by the
Compensation Committee, is intended to attract, retain and motivate high quality
executives with market and performance based compensation packages that reward
the achievement of specific financial goals and the enhancement of stockholder
value. The Committee believes that linking executive compensation to corporate
performance through a more significant emphasis on performance bonuses results
in a better alignment of compensation with corporate goals and stockholder
interests.
In evaluating the performance of executive officers, the Compensation
Committee's approach is to consult with the Chief Executive Officer, except when
evaluating his performance, in which case the Compensation Committee's approach
is to meet and deliberate independently without the Chief Executive Officer
being present. The Compensation Committee will review with the Board of
Directors in detail all aspects of compensation for the executive officers. The
Compensation Committee has access to independent compensation data and may, from
time to time in the future, consult with an outside compensation consultant.
The key elements of the Company's executive officers' compensation in
fiscal 1998 consisted principally of (1) base salary, (2) potential bonuses
based on overall Company performance for the Company's Chief Executive Officer,
Chief Financial Officer and all of the executive officers, and based in part on
overall Company performance and in part on specific performance criteria keyed
to areas of responsibility for each of the non-executive officers and (3) the
award of stock options
<PAGE>
and restricted stock under the 1997 Long-Term Incentive Plan that is designed to
give certain of the officers and other employees the opportunity to be awarded
long-term, stock-based incentives.
The Compensation Committee's policies with respect to each of these
elements are discussed below, including the basis for the compensation awarded
in fiscal 1998 to John L. Macdonald, the Company's Chief Executive Officer and
President. In addition, although the elements of compensation described below
are considered separately, the Compensation Committee takes into account the
full compensation package afforded by the Company to the individual.
BASE SALARY
Each officer's base salary is reviewed annually. The specific base
salaries are based upon the Chief Executive Officer's subjective determination
of appropriate salary levels, taking into consideration the scope of
responsibility, experience, Company and individual performance, as well as pay
practices of other companies relating to executives with similar responsibility.
The Chief Executive Officer then makes recommendations to the Compensation
Committee, which is responsible for approving or disapproving those
recommendations.
In determining the base salary of the Chief Executive Officer,
consideration was given to a comparison of base salaries of persons with
comparable positions and responsibilities in peer companies and an assessment of
the individual performance of the Chief Executive Officer. The base salary for
the Chief Executive Officer remained constant in 1998 compared to his base
salary for 1997. The increase shown on the Summary Compensation Table related to
a change in the payment method for his base salary from a biweekly to a
bimonthly pay schedule.
ANNUAL BONUS PROGRAM
The Compensation Committee believes that an executives' performance is
most appropriately measured based on progress toward achieving operating goals
that are formulated to promote advancement of key aspects of the Company's
business. The annual bonus plan for the Chief Executive Officer and President is
usually measured based on 1) the Company's ability to achieve growth in
operating income from year to year, 2) an increase in annual volumes
distributed, 3) increase in sales dollars, 4) increase in net margins and 5)
performance compared to the Company's peer group. All of these goals were either
met or exceeded except for item 1) above. The Company's incentive compensation
for executive officers other than the CEO and President is somewhat
discretionary under the Company's annual bonus program, but through objective
overall performance criteria established under the program, bonuses are expected
to be paid based on current year's performance. Performance, under the 1998
annual bonus plan for all executive officers, is measured by increased volume of
product sold, increase in market share, sales performance, and earnings
performance compared to that of the performance of the Company's peer group.
Under the bonus program in fiscal 1998 for these executive officers who held
these positions during fiscal 1997, determinations as to payment of bonuses were
made annually by the CEO and approved by the Compensation Committee. The bonus
for each of these officers was based on a pool of 5 percent of the Company's
annual net income of which 30 percent is allocated to the executive officers.
Under the bonus program, the amount of the base bonus is adjusted downward if
and to the extent the goals are not achieved and is increased if and to the
extent the goals are exceeded.
LONG-TERM COMPENSATION
The Compensation Committee awards stock options under the 1997
Long-Term Incentive Plan to executive officers, other members of management and
key individual contributors. Generally, the Chief Executive Officer will
recommend the number of options to be granted and will present this number along
with appropriate supporting data to the Compensation Committee for its review
and approval. Options are granted at fair market value on the date of grant and
therefore any value that ultimately accrues to employees under such options is
based entirely on the Company's performance, as perceived by investors who
establish the price for the Company's stock. These options generally vest 33% a
year beginning after the first year and have a 10-year duration.
Stock option grants are designed to retain key employees, by ensuring
that each has a continuing stake in the long-term success of the Company, and to
provide an incentive for employees to improve the return to stockholders. In
fiscal 1998, the Compensation Committee awarded 5,000 stock options to John T.
White, Vice President and General Counsel, and 1,000 to all other employees. The
grants were based on the employees respective responsibilities, their relative
positions in the Company and their respective contributions to the Company's
financial performance.
<PAGE>
OTHER
The Committee believes that linking executive compensation to corporate
performance through a more significant emphasis on performance bonuses results
in a better alignment of compensation with corporate goals and stockholder
interest. As performance goals are met or exceeded, resulting in increased value
to stockholders, executives are rewarded commensurately. The Committee believes
that compensation levels during fiscal 1998 adequately reflect the Company's
compensation goals and policies.
No member of the Compensation Committee is a former or current officer
of the Company.
COMPENSATION COMMITTEE:
Charles N. Neivert
Jerry L. Weinstein
Thomas F. Kennedy
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total return on the
Company's Common Stock for the period from July 24, 1997 (the date of the
Company's Initial Public Offering), to December 31, 1998, with the cumulative
total return on the Center for Research in Security Prices ("CRSP") Index for
the S&P 500 (U.S. Companies) and the CRSP Index for a Peer Group (1) for the
same period. The graph assumes the investment of $100 on July 24, 1997 and the
reinvestment of any dividends.
COMPARISON OF CUMULATIVE TOTAL RETURN
[GRAPH OMITTED]
- -------------------- --------------- ------------------- --------------------
JULY 24, 1997 DECEMBER 31, 1997 DECEMBER 31, 1998
- -------------------- --------------- ------------------- --------------------
JLM INDUSTRIES, INC. $100.00 $102.50 $ 51.30
S&P 500 INDEX $100.00 $104.37 $134.10
PEER GROUP (1) $100.00 $ 93.98 $ 70.70
- -------------------- --------------- ------------------- --------------------
(1) The Peer Group comprises publicly traded companies that are engaged in
principally or in significant part in the marketing, distribution and or
manufacturing of certain commodity chemicals, principally acetone and
phenol. The returns of each company have been weighted according to their
respective stock market capitalization for purposes of arriving at a Peer
Group average. The members of the Peer Group are Aceto Corporation, Georgia
Gulf Corporation, Great Lakes Chemical Corporation, Hanna M.A. Company and
Methanex Corporation. In 1997, the Company included Rexene Corporation as
part of its peer group. However in 1998, Rexene Corporation was acquired by
a third-party and there is no longer any data available concerning Rexene
Corporation's stock market capitalization. Therefore, the Company has
replaced Rexene Corporation with Methanex Corporation for the above
performance graph in 1998.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The current members of the Company's Compensation Committee are Messrs.
Weinstein, Kennedy and Neivert. Messrs. Kennedy and Neivert were appointed to
the Committee at the time they joined the Board of Directors. Neither Messrs.
Kahn, Weinstein, Kennedy nor Neivert were, at any time, been an officer or
employee of the Company.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
The Company's Spanish distributor is Chemical Trading, S.L. ("CTSL"),
which is owned 100.0% by Eduardo Delgadillo, a stockholder of the Company. The
Company and CTSL have an arrangement pursuant to which the Company pays CTSL's
operating expenses. The Company treats the difference between such payments and
the amount of commissions and other amounts due to CTSL as a loan. Under such
arrangement CTSL was indebted to the Company for approximately $905,000 as of
December 31, 1998. Such indebtedness is carried on an open account basis.
Effective October 1, 1998, $500,000 owed by CTSL was repaid without interest
through the sale to the Company at fair market value of 90,909 shares of
<PAGE>
common stock owned by CTSL owner. As of December 31, 1998, Mr. Delgadillo was
the beneficial owner of 1.8% of the Company's outstanding Common Stock.
In 1997, the Company entered into an agreement for sale and purchase of
common stock held by the majority stockholder of the Company and an unrelated
third party to purchase for a total purchase price of approximately $1.25
million all of the issued and outstanding shares of Aurora Chemicals, Inc.
("Aurora"), a Texas corporation. Under the terms of the agreement, the Company
purchased from the Company's majority stockholder his ownership interest in
Aurora for a $1.0 million promissory note that matures on June 1, 2002 and bears
interest at a rate of 10.0% per annum. The other shareholder received
consideration of $250,000 for the purchase of his ownership interest of which
$150,000 was paid at closing in cash and the remaining $100,000 was to be paid
by a three year promissory note which bore interest at the prime rate and was
payable in three equal annual installments. During 1998, the Company discounted
the promissory note and paid the entire outstanding balance to the shareholder.
In 1997, the Company entered into an agreement for sale and purchase of
common stock with the majority stockholder of the Company to purchase for a
total purchase price of $500,000 all of the issued and outstanding shares of
Phoenix Tank Car Corporation ("Phoenix"), a Connecticut corporation. Under the
terms of the agreement, the Company purchased this ownership interest in Phoenix
for $500,000, of which $250,000 was offset against advances owed to the Company
by the Company's majority stockholder and $250,000 paid by means of a promissory
note that matures on June 1, 2002 and bears interest at a rate of 10.0% per
annum.
The Company believes that each of the certain transactions described
above were on terms no less favorable to the Company than those which could have
been obtained in arm's length transactions with unaffiliated third parties.
However, except as indicated above, the Company did not obtain independent
objective information to support its belief in this respect.
2. RATIFICATION OF APPOINTMENT OF INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS - ITEM TWO ON YOUR PROXY CARD
The Company has engaged the firm of Deloitte & Touche LLP, independent
public accountants, to report upon the consolidated financial statements
included in the Annual Report submitted herewith. A representative from said
firm will be in attendance at the Meeting, will have the opportunity to make a
statement, if desired, and will be available to respond to any questions from
those in attendance. The Company has appointed Deloitte & Touche LLP to report
upon its 1999 consolidated financial statements, subject to ratification of such
appointment by the stockholders at the Meeting. Stockholder ratification of the
Company's independent certified public accountants is not required by the
Company's Bylaws or otherwise. The Board of Directors has elected to seek such
ratification as a matter of good corporate practice and unanimously recommends
that you vote "FOR" such ratification. If the Stockholders do not ratify this
appointment, other certified public accountants will be considered by the Board
of Directors upon recommendation of the Audit Committee.
The affirmative vote of the holders of a majority of the shares
represented, in person or by Proxy, and entitled to vote at the Meeting will be
required to ratify the appointment of Deloitte & Touche LLP. Abstentions will be
counted toward the number of shares represented at the Meeting. Broker non-votes
will be disregarded.
3. PROPOSAL TO APPROVE THE AMENDMENT OF THE NON-EMPLOYEE DIRECTORS' STOCK
OPTION PLAN - ITEM THREE ON YOUR PROXY CARD
In order to be in a position to continue to effectively attract and
retain members of the Board of Directors who are not employees of the Company or
its subsidiaries (the "Non-Employee Directors"), the Board of Directors adopted
the JLM Industries, Inc. Non-Employee Directors' Stock Option Plan (the "Plan")
in 1997.
THE AMENDMENT
As originally adopted, the Plan covered 25,000 shares of Common Stock
and provided for the automatic grant of an option to purchase 1,000 shares of
Common Stock upon the initial election and each reelection of a Non-Employee
Director. In January 1999, the Board of Directors approved, subject to
stockholder ratification at the 1999 Annual Meeting of Stockholders of certain
portions of the amendment, an amendment to the Plan to (1) increase the number
of shares of Common Stock covered by the Plan to 75,000 from 25,000, (2) to
increase the number of shares of Common Stock covered by an option received by a
Non-Employee Director upon initial election and reelection and (3) to provide
for discretionary grants of options under the Plan.
<PAGE>
The Board recommends that you vote "FOR" the amendment to the Plan. The
amendment will be approved if the votes cast "FOR" the amendment by holders
entitled to vote exceed the votes cast opposing the amendment.
Summary of the Non-Employee Directors' Stock Option Plan
Under the Plan, as amended (the "Amended Plan"), Non-Employee Directors
will be eligible to receive nonqualified stock options. No other individual is
eligible to receive options under the Amended Plan. In addition to receiving
options under the Amended Plan, Non-Employee Directors will continue to be
compensated for their services as directors. For a description of such
compensation, see "Compensation of Directors."
An aggregate of 75,000 shares of Common Stock have been reserved for
issuance under the Amended Plan. The Amended Plan is administered by the full
Board of Directors or by a committee of two or more members of the Board, as may
be designated as such by the Board.
All Non-Employee Directors are eligible to receive options under the
Amended Plan. Each Non-Employee Director will automatically be granted an option
for 5,000 shares of the Company's Common Stock upon his or her appointment to
the Board. In addition, each year, as of the date of the Company's Annual
Meeting of Stockholders, each Non-Employee Director who is then reelected or who
is continuing as a member of the Board following the Annual Meeting shall
receive an option for 2,500 shares of Common Stock. Prior to its amendment, the
Plan provided for option grants covering 1,000 shares upon initial election and
each reelection of each of the Non-Employee Directors. There is no limit as to
the number of options that may be granted any one eligible individual.
Discretionary grants of options to Non-Employee Directors may also be made from
time to time. The Company will not receive any consideration for the granting of
the options under the plan, other than the services rendered to the Company by
the Non-Employee Director in that capacity.
The per share exercise price of each of the options automatically
granted under the Amended Plan may not be less than the fair market value of the
Common Stock on the date of grant. On June 30, 1999, the reported last sale
price of the Common Stock on the Nasdaq National Market System was $5.25.
Options automatically granted under the Amended Plan will become, in
general, fully vested one year from the date of the grant, and will be
exercisable for up to five years after the date of the grant. Discretionary
options granted under the plan will have such exercise price, vesting schedule
and other terms and conditions as shall be determined by the Board of Directors
at the time of each respective grant.
If exercised, an option must be exercised within the exercise period by
payment of the option price in cash, by check or by other means prescribed by
the Amended Plan.
Should a Non-Employee Director be removed for dishonesty or violation
of his fiduciary duty, voluntarily resign under, or followed by, circumstances
which would constitute a violation of his fiduciary duty or commit an act of
dishonesty not discovered by the Company prior to the cessation of his term of
office, then any option held by such Non-Employee Director shall terminate and
become void. If a person shall cease to be a Non-Employee Director for any other
reasons, including death, then such person, at any time prior to the expiration
of the option may exercise the option with respect to any shares exercisable but
unexercised as of that date. Notwithstanding the foregoing general rules,
options may be issued for shorter periods of time and the Board of Directors may
permit the earlier exercise of outstanding options.
An individual may not transfer any option granted under the Amended
Plan, although, in some circumstances after the individual's death, the
individual's personal representative may exercise the option and, in certain
other circumstances, options can be exchanged for new options.
The aggregate number of shares covered by the Amended Plan, as well as
the number of shares covered by outstanding options (and the per share purchase
price thereof) are subject to automatic adjustment, without further action of
the Board of Directors or the stockholders, in the event of a stock dividend, a
stock split or certain other recapitalizations with respect to the Company's
Common Stock.
The Board of Directors may amend the Amended Plan (or suspend or
discontinue it) without further stockholder approval. No amendment may adversely
affect any then outstanding option.
The Amended Plan will continue for 10 years, unless the Board of
Directors votes to terminate the Amended Plan at some earlier time.
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
Because all options under the plan will be nonqualified stock options
and because the Company does not anticipate that any such options will have a
readily ascertainable fair market value when issued, the recipient of such an
option should not recognize any taxable income or loss for federal income tax
purposes at the time the option is granted. The exercise of the nonqualified
stock option will, however, result in the immediate recognition of taxable
income by its holder at ordinary income rates based on the difference between
the purchase price for shares covered by the option and the fair market value of
the shares received at the time of exercise. The Company will receive a
corresponding income tax deduction at the same time. Additional gain or loss,
determined under general rules of taxation, may be realized upon the sale of the
shares.
The specific application and impact of the tax rules may vary depending
on the personal situation of individual directors.
NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN - NEW PLAN BENEFITS TABLE
The following table provides information regarding the number of
options to be granted and the value of such options under the plan:
JLM INDUSTRIES, INC.
NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
NUMBER
NAME AND POSITION DOLLAR VALUE OF UNITS
----------------- ------------ --------
John L. Macdonald,
President and Chief Executive Officer * *
Thaddeus J. Lelek,
Vice President * *
Wilfred J. Kimball,
Vice President * *
Frank A. Musto,
Vice President & Chief Financial Officer * *
John T. White,
Vice President & General Counsel
Executive Group * *
Non-Executive Director Group (1) (2)
Non-Executive Officer Employee Group * *
- -----------------------
* Not eligible for participation.
(1) Cannot be determined
(2) The grant of options under the Plan will generally occur
automatically, in the amount of 5,000 options upon the Director's
initial appointment to the Board, and 2,500 options each year
thereafter upon each reelection of a Director. The Board of
Directors has discretion to make additional grants under the plan,
but the Company cannot determine the nature or amount of any
discretionary awards that will be made in the future. Roger C.
Kahn and Jerry L Weinstein have each been granted options to
purchase 7,500 shares of Common Stock and Thomas F. Kennedy has
been granted an option to purchase 5,000 shares of Common Stock.
<PAGE>
OTHER BUSINESS
Management of the Company does not know of any other business that may
be presented at the Meeting. If any matter not described herein should be
presented for stockholder action at the Meeting, the persons named in the
enclosed Proxy will vote the shares represented thereby in accordance with their
best judgment.
STOCKHOLDER PROPOSALS FOR
PRESENTATION AT THE 2000 ANNUAL MEETING
The Board of Directors requests that any stockholder proposals intended
for presentation at the 2000 Annual Meeting be submitted to Michael J. Molina,
Secretary, in writing no later than March 10, 2000, for consideration for
inclusion in the Company's Proxy materials for such meeting.
The Company's By-laws and Restated Certificate of Incorporation require
certain advance notice to the Company of any nominations by stockholders of
persons to stand for election as directors at stockholders' meetings. Notice of
director nominations must be timely given in writing to the Secretary of the
Company prior to the meeting at which the directors are to be elected. To be
timely, notice must be received at the principal executive offices of the
Company not less than 60 nor more than 90 days prior to the meeting of
stockholders; provided, however, that in the event that less than 70 days'
notice or prior public disclosure of the date of the meeting is given or made to
the stockholders, notice by the stockholder in order to be timely must be so
received not later than the close of business on the tenth day following the day
on which such notice of the date of the annual meeting was mailed or public
disclosure of the date of the annual meeting was made, whichever first occurs.
A stockholder's notice with respect to a director nomination must be
set forth (i) certain information about the nominee, (ii) the consent of the
nominee to serve as a director, if elected, (iii) the name and record address of
the nominating stockholder, (iv) the class or series and number of shares of the
Company which are beneficially owned by such stockholder, (v) a description of
all arrangements or understandings between such stockholder and each proposed
nominee and any other person pursuant to which the nominations are to be made,
(vi) a representation that such stockholder intends to appear in person or by
Proxy at the meeting to nominate the persons named and (vii) certain other
information.
The complete provisions governing these requirements are available to
any stockholder without charge upon request from the Secretary of the Company.
By Order of the Board of Directors,
/s/ MICHAEL J. MOLINA
-------------------------------
Michael J. Molina
Secretary
Tampa, Florida
July 8, 1999
<PAGE>
APPENDIX A
JLM INDUSTRIES, INC.
NON-EMPLOYEE DIRECTORS' STOCK OPTION
PLAN
(As Amended by the First Amendment Adopted January 1999)
ARTICLE 1
GENERAL
1.1 PURPOSE. The purpose of the JLM Industries, Inc. Non-Employee
Directors' Stock Option Plan is to secure for JLM Industries, Inc. and its
stockholders the benefits of the incentive inherent in increased common stock
ownership by the members of the Board of Directors of the Company who are not
employees of the Company or any of its Subsidiaries.
1.2 MAXIMUM NUMBER OF SHARES. The maximum number of shares of Common Stock
that may be offered under the Plan is 75,000, subject to adjustment as provided
in Section 3.1 below. The Common Stock to be issued may be either authorized and
unissued shares or issued shares acquired by the Company or its Subsidiaries. In
the event that Options granted under the Plan shall terminate or expire without
being exercised in whole or in part, new Options may be granted covering the
shares not purchased under such lapsed Options.
1.3 DEFINITIONS. The following words and terms as used herein shall have
that meaning set forth therefor in this Section 1.3 unless a different meaning
is clearly required by the context. Whenever appropriate, words used in the
singular shall be deemed to include the plural and vice versa, and the masculine
gender shall be deemed to include the feminine gender.
1.3.1 "BOARD" or "BOARD OF DIRECTORS" shall mean the Board of
Directors of the Company.
1.3.2 "COMMITTEE" is defined in Section 1.4.
1.3.3 "COMMON STOCK" shall mean the common stock of the Company.
1.3.4 "COMPANY" shall mean JLM Industries, Inc., a Delaware
corporation, and any successor.
1.3.5 "EFFECTIVE DATE" is defined in Section 3.10.
1.3.6 "FAIR MARKET VALUE" of the shares of Common Stock shall mean the
closing price on the date in question (or, if no shares are traded on such
day, on the next preceding day on which shares were traded), of the Common
Stock on the principal securities exchange in the United
<PAGE>
States on which such stock is listed, or if such stock is not listed on a
securities exchange in the United States, the closing price on such day in
the over-the-counter market as reported by the National Association of
Security Dealers Automated Quotation System (NASDAQ), or NASDAQ's
successor, or if not reported on NASDAQ, the fair market value of such
stock as determined by the Committee in good faith and based on all
relevant factors.
1.3.7 "NSO" shall mean a nonqualified stock option granted in
accordance with the provisions of Article 2 of this Plan.
1.3.8 "NON-EMPLOYEE DIRECTOR" shall mean a member of the Board of
Directors of the Company who is not an employee of the Company or any
Subsidiary.
1.3.9 "OPTION" shall mean an NSO.
1.3.10 "OPTIONEE" shall mean a Non-Employee Director to whom an Option
is granted under the Plan.
1.3.11 "PLAN" shall mean the JLM Industries, Inc. Non-Employee
Directors' Stock Option Plan, as set forth herein and as amended from time
to time.
1.3.12 "SUBSIDIARY" shall mean any corporation that at the time
qualifies as a subsidiary of the Company under the definition of
"subsidiary corporation" contained in Section 424(f) of the Internal
Revenue Code of 1986, as amended.
1.4 ADMINISTRATION. The Plan shall be administered by a Committee
comprised of members of the Board (the "Committee"). The Committee shall have
all the powers vested in it by the terms of the Plan, such powers to include
authority (within the limitations described herein) to prescribe the form of the
agreement embodying awards of nonqualified stock options made under the Plan.
The Committee shall, subject to the provisions of the Plan, grant Options and
have the power to construe the Plan, to determine all questions arising
thereunder and to adopt and amend such rules and regulations for the
administration of the Plan as it may deem desirable. Any decision of the
Committee in the administration of the Plan, as described herein, shall be final
and conclusive. The Committee may act only by a majority of its members in
office, except that the members thereof may authorize any one or more of their
number or the Secretary or any other officer of the Company to execute and
deliver documents on behalf of the Committee. No member of the Committee shall
be liable for anything done or omitted to be done by such member or by any other
member of the Committee in connection with the Plan, except for such member's
own willful misconduct or as expressly provided by statute.
1.5 ELIGIBILITY REQUIREMENTS. Each Non-Employee Director shall be eligible
to receive Options in accordance with Article 2 below. The adoption of this Plan
shall not be deemed to give any director any right to or be granted options to
purchase Common Stock of the Company, except to the extent and upon such terms
and conditions as set forth in this Plan.
<PAGE>
ARTICLE 2
TERMS AND CONDITIONS OF OPTIONS
2.1 GRANT. Options granted under the Plan shall be evidenced by an
agreement in such form as the Board shall prescribe from time to time in
accordance with the Plan and shall comply with the terms and conditions set
forth under this Article 2. The date of the Annual Meeting of Stockholders or
the date of a Directors' initial appointment to the Board, whichever is
applicable, shall be the date of grant of the Options.
2.2 NONQUALIFIED STOCK OPTIONS. An Option granted under the Plan shall be
an NSO which is intended to be an option that does not qualify as an "incentive
stock option" under Section 422 of the Code.
2.3 AUTOMATIC GRANTS.
2.3.1 Each Non-Employee Director shall be granted an Option for 5,000
shares of Common Stock upon his or her initial appointment to the Board.
In addition, each year, as of the date of the Annual Meeting of
Stockholders of the Company, each Non-Employee Director who is then
reelected or who is continuing as a member of the Board after the
adjournment of the Annual Meeting shall be granted an Option for 2,500
shares of Common Stock.
2.3.2 The Option exercise price for each such automatic grant shall be
the Fair Market Value of the Common Stock on the date of the grant of the
Option.
2.3.3 One hundred percent (100%) of the total number of shares of
Common Stock covered by an automatic grant Option shall become exercisable
beginning with the date which is one (1) year after the date of the grant
of the Option and shall be exercisable by the Non-Employee Director for a
period of five (5) years from the date of grant. Not less than one hundred
(100) shares may be exercised at any one time unless the number exercised
is the total number at the time exercisable under the Option.
2.3.4 Notwithstanding the foregoing, no automatic grant Option or any
part of an automatic grant Option shall be exercisable (a) before the
Non-Employee Director has served one term-year as a member of the Board
(as used herein, the term "term-year" means that period from one Annual
Meeting to the subsequent Annual Meeting), (b) after the expiration of
five (5) years from the date the Option was granted, and (c) unless
written notice of the exercise is delivered to the Company specifying the
number of shares to be purchased and payment in full is made for the
shares of Common Stock being acquired thereunder at the time of exercise.
2.4 METHOD OF EXERCISE. An Option may be exercised by a Non-Employee
Director during such time as may be permitted by the Option and the Plan by
providing written notice to the Board and tendering the purchase price in
accordance with the provisions of Section 2.5, and complying with any other
exercise requirements contained in the Option or promulgated from time to time
by the Board.
<PAGE>
2.5 METHOD OF PAYMENT. Each Option shall state the method of payment of
the Option price upon the exercise of the Option. The method of payment stated
in the Option shall include payment (a) in United States dollars in cash or by
check, bank draft or money order payable to the order of the Company, (b) in the
discretion of and in the manner determined by the Board, by the delivery of
shares of Common Stock already owned by the Optionee, (c) by any other legally
permissible means acceptable to the Board at the time of the grant of the Option
(including cashless exercise as permitted under the Federal Reserve Board's
Regulation T, subject to applicable legal restrictions), or (d) in the
discretion of the Board, through a combination of (a), (b) and (c) of this
Section 2.5. If the option price is paid in whole or in part through the
delivery of shares of Common Stock, the decision of the Board with respect to
the Fair Market Value of such shares shall be final and conclusive.
2.6 DISCRETIONARY GRANTS. The Committee may also make discretionary grants
of Options to Non-Employee Directors. The number of shares of Common Stock
underlying such discretionary Options and the exercise price, vesting and other
terms and conditions of such Options shall be determined by the Committee at the
time such Options are granted.
2.7 DEATH OR OTHER TERMINATION OF POSITION AS A DIRECTOR. Subject to the
provisions on exercise contained in this Section 2, in the Option or as
promulgated by the Board:
2.7.1 In the event that a Non-Employee Director (a) is removed as a
director for dishonesty or violation of his or her fiduciary duty to the
Company, (b) voluntarily resigns under or followed by such circumstances
as would constitute a violation of his or her fiduciary duty to the
Company, or (c) commits an act of dishonesty not discovered by the Company
prior to the cessation of his or her services as a Non-Employee Director
but that would have resulted in his or her removal if discovered prior to
such date, then forthwith from the happening of any such event, any Option
then held by him or her shall terminate and become void to the extent that
it then remains unexercised.
2.7.2 If a person shall cease to be a Non-Employee Director for any
reason other than one or more of the reasons set forth in section 2.7.1,
such person, or in the case of death, the executors, administrators or
distributees, as the case may be, may, at any time prior to the date of
the expiration of the Option, exercise the Option with respect to any
shares of Common Stock as to which such person has not exercised the
Option on the date the person ceased to be such a Non-Employee Director.
2.7.3 In the event any Option is exercised by the executors,
administrators, legatees or distributees of the estate of a deceased
Optionee, the Company shall be under no obligation to issue Common Stock
thereunder unless and until the Company is satisfied that the person or
persons exercising the Option are the duly appointed legal representatives
of the deceased Optionee's estate or the proper legatees or distributees
thereof.
2.8 TRANSFERABILITY OF OPTIONS. The Option shall not be transferable by
the Optionee otherwise than by will or the laws of descent and distribution, and
shall be exercisable during his lifetime only by him.
2.9 DELIVERY OF CERTIFICATES REPRESENTING SHARES. As soon as practicable
after the exercise of an Option, the Company shall deliver, or cause to be
delivered, to the Non-Employee Director exercising the Option, a certificate or
certificates representing the shares of Common Stock purchased
<PAGE>
upon the exercise. Certificates representing shares of Common Stock to be
delivered to a Non-Employee Director shall be registered in the name of such
director.
2.10 RIGHTS AS A STOCKHOLDER. A Non-Employee Director shall have no rights
as a stockholder with respect to any shares of Common Stock covered by his or
her Option until the date on which he or she becomes a record owner of the
shares purchased upon the exercise of the Option (the "record ownership date").
No adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property), distributions, or other rights for which
the record date is prior to the record ownership date.
ARTICLE 3
MISCELLANEOUS
3.1 STOCK ADJUSTMENTS.
3.1.1 In the event of any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split or other division or
consolidation of shares or the payment of a stock dividend (but only on
Common Stock) or any other increase or decrease in the number of such
shares effected without any receipt of consideration by the Company, then,
in any such event, the number of shares of Common Stock that remain
available under the Plan, the number of shares of Common Stock covered by
each outstanding Option, and the purchase price per share of Common Stock
covered by each outstanding Option shall be proportionately and
appropriately adjusted for any such increase or decrease.
3.1.2 Subject to any required action by the stockholders, if any
change occurs in the shares of Common Stock by reason of any
recapitalization, reorganization, merger, consolidation, split-up,
combination or exchange of shares, or of any similar change affecting the
shares of Common Stock, then, in any such event, the number and type of
shares covered by each outstanding Option, and the purchase price per
share of Common Stock covered by each outstanding Option, shall be
proportionately and appropriately adjusted for any such change. A
dissolution or liquidation of the Company shall cause each outstanding
Option to terminate.
3.1.3 In the event of a change in the Common Stock as presently
constituted that is limited to a change of all of its authorized shares
with par value into the same number of shares with a different par value
or without par value, the shares resulting from any change shall be deemed
to be shares of Common Stock within the meaning of the Plan.
3.1.4 To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by, and in the
discretion of, the Committee, whose determination in that respect shall be
final, binding and conclusive. Except as hereinabove expressly provided in
this Section 3.1, a Non-Employee Director shall have no rights by reason
of any division or consolidation of shares of stock of any class or the
payment of any stock dividend or any other increase or decrease in the
number of shares of stock of any class or by reason of any dissolution,
liquidation, merger or consolidation, or spin-off of assets or stock of
another corporation; and any issuance by the Company of shares of stock of
any class, securities convertible into shares of stock of any class, or
warrants or options for shares of stock of any class shall not affect, and
no adjustment
<PAGE>
by reason thereof shall be made with respect to, the number or price of
shares of Common Stock subject to the Option.
3.1.5 The existence of the Plan and the grant of any Option pursuant
to the Plan shall not affect in any way the right or power of the Company
to make adjustments, reclassifications, reorganizations or changes of its
capital or business structure or to merge or to consolidate, or to
dissolve, to liquidate, to sell, or to transfer all or any part of its
business or assets.
3.2 LISTING AND REGISTRATION OF COMMON STOCK. Each Option shall be subject
to the requirement that if at any time the Board of Directors shall determine,
in its discretion, that the listing, registration or qualification of the shares
of Common Stock covered thereby upon any securities exchange or under any state
or federal laws, or the consent or approval of any governmental regulatory body,
is necessary or desirable as a condition of, or in connection with, the granting
of such Option or the issuance or purchase of shares thereunder, such Option may
not be exercised unless and until such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Board. Notwithstanding anything in the Plan to the
contrary, if the provisions of this Section become operative, and if, as a
result thereof, the exercise of an Option is delayed, then and in that event,
the term of the Option shall not be affected. Notwithstanding the foregoing, or
any other provisions in the Plan, the company shall have no obligation under the
Plan to cause any share of Common Stock to be registered or qualified under any
federal or state law, or listed on any stock exchange or admitted to any
national market system.
3.3 NO IMPLIED RIGHTS TO DIRECTORS. Except as expressly provided for in
the Plan, no Non-Employee Director or other person shall have any claim or right
to be granted an Option under the Plan. Neither the Plan nor any action taken
hereunder shall be construed as giving any Non-Employee Director any right to
be retained in the service of the Company.
3.4 TERM OF THE PLAN. The Plan shall terminate upon the earlier of the
dates or events to occur: (a) upon the adoption of a resolution of the Board
terminating the Plan; or (b) ten years from the Effective Date.
3.5 AMENDMENT OF THE PLAN; TERMINATION. The Board may, insofar as
permitted by law, from time to time, with respect to any shares of Common Stock
at the time not subject to Options, suspend, discontinue or terminate the Plan
or revise or amend it in any respect whatsoever.
3.6 APPLICATION OF FUNDS. The proceeds received by the Company from the
sale of Common Stock pursuant to Options will be used for general corporate
purposes.
3.7 NO OBLIGATION TO EXERCISE. The granting of any Option under the Plan
shall impose no obligation upon any Optionee to exercise such Option.
3.8 NO IMPLIED RIGHTS TO DIRECTORS. Except as expressly provided for in
the Plan, no Non-Employee Director or other person shall have any claim or right
to be granted an Option under the Plan. Neither the Plan, nor any action taken
hereunder, shall be construed as giving any Non-Employee Director any right to
be retained as a Director or in any other capacity.
3.9 WITHHOLDING. Whenever the Company proposes or is required to issue or
transfer shares of Common Stock under the Plan, the Company shall have the right
to require the Optionee
<PAGE>
to remit to the Company an amount sufficient to satisfy any federal, state or
local withholding tax liability prior to the delivery of any certificate or
certificates for such shares. Whenever under the Plan payments are to be made in
cash, such payments shall be made net of an amount sufficient to satisfy any
federal, state or local withholding tax liability.
3.10 CONDITIONS PRECEDENT TO EFFECTIVENESS. The Plan shall become
effective upon the satisfaction of all the following conditions, with the
Effective Date of the Plan being the date that the last such condition is
satisfied:
3.10.1 the adoption of the Plan by the Board of Directors; and
3.10.2 the closing of the initial public offering of the Company's
Common Stock.
<PAGE>
JLM INDUSTRIES, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON AUGUST 12, 1999
The undersigned, a stockholder of JLM INDUSTRIES, INC. (the "Company"),
does hereby appoint Frank A. Musto and John T. White and each of them acting
individually, as the attorneys and proxies of the undersigned, with power of
substitution, for and on behalf of the undersigned, to attend the Annual Meeting
of Stockholders of the Company to be held at The Radisson Hotel, 10221 Princess
Palm Avenue, Tampa, Florida 33610 at 11:00 a.m., Eastern Standard Time, on
August 12, 1999 and any adjournment or adjournments thereof (the "Annual
Meeting"), to represent the undersigned at the Annual Meeting, and there to vote
all the shares of Common Stock of the Company which the undersigned is entitled
to vote at the Annual Meeting, in any manner and with the same effect as if the
undersigned were personally present at the Annual Meeting, all as described in
the Company's Proxy Statement dated July 8, 1998 relating to the Annual Meeting,
and the undersigned hereby authorizes and instructs the above named proxies to
vote as follows:
The Board of Directors recommends voting FOR the following proposals:
1. ELECTION OF DIRECTORS.
Nominees for Directors: John L. Macdonald, Frank A. Musto, Walter M.
Tarpley, Sean D. Macdonald, Jerry L. Weinstein, Thomas F. Kennedy
and Charles N. Neivert.
[ ] FOR the nominees listed above (except as marked to the contrary).
[ ] AUTHORITY WITHHELD to vote for the nominees listed above.
(Instruction: To withhold authority to vote for any individual
nominee, strike a line through the nominee's name in the list
above).
2. PROPOSAL TO RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE
COMPANY'S INDEPENDENT AUDITORS FOR FISCAL YEAR 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. PROPOSAL TO AMEND THE NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. OTHER MATTERS. Unless a line is stricken through this sentence, the
proxies herein named may in their discretion vote the shares
represented by this Proxy upon such other matters as may properly
come before the Annual Meeting.
The shares represented by this Proxy will be voted only if this Proxy
is properly executed and timely returned. In that event, such shares will be
voted in the manner directed herein. IF NO DIRECTION IS MADE, THE SHARES WILL BE
VOTED FOR THE NOMINEES FOR DIRECTOR, FOR THE PROPOSAL TO RATIFY DELOITTE &
TOUCHE LLP AS THE COMPANY'S INDEPENDENT AUDITORS, FOR THE AMENDMENT TO THE
NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN AND FOR OTHER MATTERS THAT MAY
PROPERLY COME BEFORE THE ANNUAL MEETING.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
The undersigned acknowledges receipt of (1) the Company's 1998 Annual
Report to Stockholders and (2) the Company's Notice of Annual Meeting and Proxy
Statement dated July 8, 1999 relating to the Annual Meeting. The undersigned
does hereby revoke any proxy previously given with respect to the shares
represented by this Proxy.
Dated:______________________________, 1999
__________________________________________
Signature
__________________________________________
Signature if held jointly
NOTE: Your signature should appear as your
name appears hereon. As to shares held in
joint names, each joint owner should sign.
If the signer is a corporation, please
sign full corporate name by a duly
authorized officer. If a partnership,
please sign in partnership name by an
authorized person. If signing as attorney,
executor, administrator, trustee,
guardian, or in other representative
capacity, please give full title as such.
PLEASE MARK, SIGN AND DATE THIS PROXY CARD AND PROMPTLY RETURN IT
USING THE ENCLOSED ENVELOPE.
