<PAGE> 1
HOLT'S CIGAR HOLDINGS, INC.
[LOGO] NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD AUGUST 17, 1999
PLEASE TAKE NOTICE that the Annual Meeting of Stockholders of Holt's
Cigar Holdings, Inc. ("Holt's Cigar") will be held at the Radisson Hotel
Philadelphia Northeast, U.S. Route 1 at Old Lincoln Highway, Trevose, PA 19053
on the 17th day of August, 1999, at 10:00 A.M., local time, to consider and act
upon:
1. Elect two Class II Directors of Holt's Cigar to serve until the 2002
Annual Meeting of Stockholders;
2. The approval of the selection of PricewaterhouseCoopers LLP as
Holt's Cigar's independent accountants for the fiscal year ending March 31,
2000;
3. The approval of the increase by 100,000 of the shares of the common
stock of Holt's Cigar which are subject to the 1997 Employee Stock Option Plan;
and
4. Such other business as may properly be brought before the Annual
Meeting or any adjournment or postponement thereof.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE
AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE.
Only stockholders of record at the close of business on June 28, 1999
are entitled to notice of, and to vote at, the Annual Meeting. A list of
stockholders of Holt's Cigar as of the close of business on June 28, 1999 will
be available for inspection during normal business hours from August 2, 1999
through August 16, 1999 at 12270 Townsend Road, Philadelphia, Pennsylvania
19154, starting at 10:00 A.M., local time.
/s/ MICHAEL PITKOW
--------------------------------
Secretary
Dated: June 29, 1999
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HOLT'S CIGAR HOLDINGS, INC.
12270 TOWNSEND ROAD
PHILADELPHIA, PENNSYLVANIA 19154
PROXY STATEMENT
This Proxy Statement is furnished to the stockholders of Holt's Cigar
Holdings, Inc. ("Holt's Cigar" or the "Company") in connection with the
solicitation by the Board of Directors of proxies for the Annual Meeting of
Stockholders to be held on August 17, 1999 at 10:00 A.M., local time, at the
Radisson Hotel Philadelphia Northeast, U.S. Route 1 at Old Lincoln Highway,
Trevose, PA 19053, and at any postponements or adjournments thereof for the
purposes set forth in the accompanying notice of meeting.
GENERAL
This solicitation is being made on behalf of the Board of Directors of
Holt's Cigar. The initial distribution of proxy materials is expected to be made
on or about July 19, 1999. Any proxy received in the accompanying form may be
revoked by the person executing it at any time before the authority thereby
granted is exercised. Proxies received by the Board of Directors in such form
will be voted at the meeting or any adjournment thereof as specified therein by
the person giving the proxy; if no specification is made, the shares represented
by such proxy will be voted (i) for the election of directors as described in
this Proxy Statement; (ii) for approval of the selection of
PricewaterhouseCoopers LLP as independent accountants for Holt's Cigar for the
fiscal year ending March 31, 2000; (iii) for the approval of the increase by
100,000 of the number of shares of the common stock of Holt's Cigar which are
subject to the 1997 Employee Stock Option Plan. For voting purposes (as opposed
to for purposes of establishing a quorum) abstentions and broker non-votes will
not be counted in determining whether the directors standing for election have
been elected or whether the other matters to be voted on have been approved.
Proposals by Stockholders for Holt's Cigar's 2000 Annual Meeting of Stockholders
must be received by Holt's Cigar before February 1, 2000.
Management knows of no other matters which may be brought before the
Annual Meeting or any adjournment thereof other than those described in the
accompanying notice of meeting and routine matters incidental to the conduct of
the meeting. However, if any other matter should come before the meeting or any
adjournment thereof, it is the intention of the persons named in the
accompanying form of proxy or their substitutes to vote the proxy in accordance
with their judgment on such matters.
The cost of solicitation of proxies by the Board of Directors will be
borne by Holt's Cigar. Such solicitation will be made by mail, and in addition
may be made by officers and employees of Holt's Cigar personally or by
telephone, facsimile or telegram. Proxies and proxy materials will also be
distributed through brokers, custodians and other similar parties.
Each holder of a share of Common Stock, par value $0.001 per share, of
Holt's Cigar (the "Common Stock") will be entitled to one vote for each share
held of record by such person at the close of business on June 28, 1999 (the
"Record Date"), which is the record date fixed by the Board of Directors for the
determination of stockholders entitled to notice of, and to vote at, the Annual
Meeting or any adjournment thereof. As of such date, Holt's Cigar had
outstanding 6,123,145 shares of Holt's Cigar's $.001 par value common stock the
("Common Stock") (of which 126,967 are shares of treasury stock). Of the
outstanding shares, 2,780,910 shares of Common Stock representing 45.4% of the
outstanding shares of Common Stock are owned by Robert G. Levin, President,
Chairman of the Board and Chief Executive Officer of Holt's Cigar, and 1,493,102
shares of Common Stock, representing 24.4% of the outstanding shares of Common
Stock are owned by the Fuente Investment Partnership, a Florida General
Partnership whose partnership interests of which are beneficially owned by
Carlos A. Fuente, Sr., Carlos P. Fuente, Jr., and Cynthia Fuente Suarez. Carlos
P. Fuente, Jr. and Cynthia Fuente Suarez are the children of Carlos A. Fuente,
Sr. The Fuente Investment Partnership and Robert G. Levin have entered into an
agreement which provides that Mr. Levin will vote all of his shares of Common
Stock for the election of two directors nominated by the Fuente Investment
Partnership (currently Carlos A. Fuente, Sr. and Carlos P. Fuente, Jr.) and the
Fuente Investment Partnership will vote all of its shares of Common Stock for
the remainder of the directors to be nominated by Mr. Levin. Collectively, and
pursuant to that Agreement, Mr. Levin has informed Holt's Cigar that he will
vote for the election of the nominees for election to the Board of Directors
identified herein and for the ratification of PricewaterhouseCoopers, LLP as
Holt's Cigar's independent accountants. The affirmative vote of Mr. Levin, and
pursuant to the voting agreement, the shares held by Fuente Investment
Partnership, would be sufficient, without the concurring vote of any other
stockholder of Holt's Cigar, to elect the directors proposed by the Board of
Directors. The affirmative vote of Mr. Levin and the Fuente Investment
Partnership would be sufficient, without the concurring vote of any other
stockholder of Holt's Cigar, to appoint PricewaterhouseCoopers LLP as Holt's
Cigar's independent accountants for the fiscal year ending March 31, 2000.
The Common Stock trades on the NASDAQ National Market under the symbol
HOLT.
As used herein, the term "Company" refers to Holt's Cigar Holdings,
Inc. and its subsidiaries, including Holt's Cigar Co., Inc. ("HCC"), Ashton
Distributors, Inc. ("Distributors"), Holt's Company ("HC"), Ashton Pipe Company,
Inc. ("AP") and Holt's Mail Order, Inc. ("HMO").
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ELECTION OF DIRECTORS
At the 1999 Annual Meeting of Stockholders, the two Class II Directors
(out of a total of six directors) are to be elected. The Board of Directors
proposes the nominees listed below for re-election as Class II Directors to
serve until the 2002 Annual Meeting of Stockholders or until their successors
are duly elected and qualified. Both nominees have served as directors since
September 1997. The directors must be elected by a plurality of the votes cast
in person or by proxy by stockholders entitled to vote at the meeting. If for
any reason any nominee or nominees become unavailable for election, the proxy
holders will vote for such substitute nominee or nominees as may be designated
by the Board of Directors.
INFORMATION CONCERNING DIRECTOR NOMINEES
<TABLE>
<CAPTION>
AGE, DATE SINCE
WHICH HAS CONTINUOUSLY PRINCIPAL OCCUPATION AND ALSO SERVES AS A DIRECTOR
SERVED AS A DIRECTOR, AND BUSINESS EXPERIENCE OF THE FOLLOWING
NAME COMMITTEE MEMBERSHIPS DURING PAST FIVE YEARS CORPORATIONS
---- --------------------- ---------------------- ------------
<S> <C> <C> <C>
Carlos P. Fuente, Jr. (1).... 45, September 1997; Director President and Chief
Operating Officer
Fuente Cigar Ltd.
Marvin B. Sharfstein......... 55, September 1997; V.P. of Corporate Proscape Technologies,
Director, Compensation Development & Director Inc.
and Audit Committees of Cabot Medical Corp.
(1983-1996); President
MBS Capital Corp. (1996)
</TABLE>
The following directors will continue to serve after the 1999 Annual Meeting:
<TABLE>
<CAPTION>
AGE, DATE SINCE
WHICH HAS CONTINUOUSLY PRINCIPAL OCCUPATION AND ALSO SERVES AS A DIRECTOR
SERVED AS A DIRECTOR, BUSINESS EXPERIENCE OF THE FOLLOWING
NAME AND COMMITTEE MEMBERSHIPS DURING PAST FIVE YEARS CORPORATIONS
---- ------------------------- ---------------------- ------------
<S> <C> <C> <C>
Robert G. Levin.............. 52, Chairman of Board, Chairman, Chief
Chief Executive Officer & Executive Officer and
President (1972) President, Holt's Cigar
Company Inc., Ashton
Distributors, Inc. and
Ashton Holdings, Inc.
Carlos A. Fuente, Sr.(1)..... 64, September 1997; Director Chairman of the Board
and Chief Executive
Officer of Fuente Cigar
Ltd.
Harvey W. Grossman........... 61, September 1997; Certified Public Proscape Technologies,
Director, Audit and Accountant and partner Inc.
Compensation Committees in Cogen Sklar LLP
Michael Pitkow............... 50, September 1997; Chief 1985-95 owner of Pitkow
Operating Officer (1995), Associates, media
Executive Vice President service; 1983-85 general
and Director (1997) manager of Cable AdNet
</TABLE>
(1) Carlos A. Fuente, Sr. is the father of Carlos P. Fuente, Jr.
The Board of Directors held four meetings during the fiscal
year ending March 31, 1999. The Company has the following Committees of the
Board of Directors: Audit and Compensation. Committee Memberships of the Board
of Directors are indicated in the above table. Directors as a whole attended
approximately 95.8% of the aggregate of all Board and Committee meetings (of
committees of which they were members). No Director attended less that 75% of
the aggregate of all Board and Committee meetings.
Members of the Board of Directors who are not employees of the
Company received $1,000 for each Board and Committee meeting attended since
Holt's Cigar initial public offering of Common Stock on November 24, 1997.
Non-employee Directors of Holt's Cigar participate in the Company's stock option
plan for non-employee Directors.
The Audit Committee, whose Chairman is Mr. Sharfstein, reviews
audit reports and the scope of audit by the Company's
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independent accountants and related matters pertaining to the preparation and
examination of the Company's financial statements. From time to time such
Committee makes recommendations to the Board of Directors with respect to the
foregoing matters as well as with respect to the appointment of the Company's
independent accountants. The Audit Committee held two meetings during the fiscal
year ended March 31, 1999 and recommended to the Board of Directors the
selection of PricewaterhouseCoopers LLP as the Company's independent accountants
for the fiscal year ending March 31, 2000 (See "Selection of Independent
Accountants").
The Board of Directors, whose Chairman is Mr. Levin,
recommended the election of the director-nominees proposed in this Proxy
Statement for election by the stockholders. The Board of Directors, excluding
those members whose seats are to be filled by the election of the Annual
Meeting, reviews incumbent directors and the qualifications of candidates
suggested from all sources, including Board members, management and
stockholders. Stockholders desiring to recommend candidates for election as
directors at the Company's 2000 Annual Meeting of Stockholders should submit
names and appropriate biographical information to the Secretary of the Company
before February 1, 2000
For information about the Compensation Committee, see
Compensation Committee Report on Executive Compensation.
PROPOSAL TO AMEND THE COMPANY'S 1997 EMPLOYEE STOCK OPTION PLAN
The Board of Directors believes the Company's 1997 Employee Stock Option
Plan (the "Plan") is an effective means of attracting, motivating and retaining
key personnel of the Company, and that the authorization of additional shares
for the grant of options under the Plan will facilitate the achievement of the
Plan's purpose.
In order to provide the Compensation Committee with the ability to issue
grants during fiscal 2000 to key personnel and to have available shares in order
to attract further key personnel, on November 3, 1998, the Board of Directors
amended the Plan, subject to shareholder approval, to increase the aggregate
maximum number of shares for which options may be granted under the Plan by
100,000 from 318,362 to 418,362. As of June 1, 1999, options have been granted
under the Plan to purchase 259,433 shares.
1. SUMMARY OF THE PLAN
The key features of the Plan are as follows:
(a) Eligibility. All officers and other key employees of the Company
and any of its subsidiaries are eligible to receive options under the Plan.
(b) Grant. The Plan allows the Board of Directors to grant options as
it, in its sole discretion, may determine. Options may be in the form of
Incentive Stock Options or Non-Qualified Stock options. The Board of Directors
has delegated all of its responsibilities in connection with the administration
granting of options to the Compensation Committee, currently composed of Messrs.
Sharfstein and Grossman.
(c) Shares covered by the Plan. The maximum number of shares of the
Company's common stock reserved for issuance under the Plan (the "Plan Shares"),
as amended, is 418,362 (increased from the 318,362 share maximum prior to this
amendment), subject to adjustment on the occurrence of a stock dividend, stock
split, recapitalization or certain other capital adjustments. If an option
granted under the Plan expires or terminates without having been fully exercised
for any reason, the Plan Shares underlying such portion of the unexercised
option may again be the subject of one or more awards granted pursuant to the
Plan. Prior to the date of this Proxy, option grants have been made to the
following persons or groups with the underlying share amounts immediately
following each person or group) Robert J. Levin, Chairman, President and Chief
Executive Officer (53,060); Michael Pitkow, Executive Vice President and Chief
Operating Officer (26,530); Jerry L. Cox, Chief Financial Officer and Treasurer
(26,530); all current executive officers as a group (106,120); all other
employees as a group (153,313).
(d) Administration. The Plan is administered by the Compensation
Committee formed of the Board of Directors, which is currently composed of
Marvin B. Sharfstein and Harvey W. Grossman. Each member of the Committee is a
non-employee director as such term in defined in Rule 16b-3 under the Securities
Exchange Act of 1934, as amended, and an "outside director" within the meaning
of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code").
Subject to the provisions of the Plan, the Committee is authorized to determine
the participants to whom, and the times at which, awards under the Plan shall be
granted. Furthermore, the Committee determines the type of award to be granted
and the number of shares underlying options comprising each such award. The
Committee is authorized to determine other terms and conditions of awards which
are not inconsistent with the Plan. Any awards granted pursuant to the Plan will
be evidenced by an award document setting forth the terms of the award.
Interpretation and construction by the Committee of any provision of the Plan or
of any award document is final, binding and conclusive. The members of the
Committee serve at the pleasure of the Board of Directors and may be replaced at
any time by action of the Board.
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(e) Term of the Plan. No award may be granted under the Plan after
September 30, 2006.
(f) Option Provisions.
(i) Exercise Price of Options under the Plan. The Committee
determines for each option grant, the exercise price for the shares covered
thereby (the "Option Shares"). The exercise price cannot be less than the fair
market value of the Option Shares at the time of the grant. If an Incentive
Stock Option is granted to an optionee who then owns, directly or indirectly by
attribution under Section 424(d) of the Code, shares of the Company's stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company, the exercise price for the Option Shares must be at least
110% of the fair market value of such shares on the date the option is granted.
(ii) Payment. Payment for shares of common stock purchased
upon the exercise of options may be made by cash or such other method of payment
as the Committee may approve.
(iii) Term of Options. The right of an optionee to exercise
any part of an option granted pursuant to the Plan terminates on the first to
occur of the following:
(A) Ten years after the date of grant or
expiration of the option term specified in
the option document as determined by the
Committee;
(B) Expiration of one year from the date the
optionee's employment or service with the
Company terminates as a result of the
optionee's death or disability;
(C) Upon the termination of the optionee's
employment or service with the Company other
than as a result of the optionee's death or
disability, although the Committee may elect
to grant such optionee a period, not to
exceed ninety days from the date of such
optionee's termination of employment or
service with the Company, in which to
exercise any options; or
(D) The effective date of certain sales,
mergers, reorganizations or other organic
changes to the existence or capital stock of
the Company, or immediately upon a
liquidation or dissolution of the Company.
(iv) Transferability of Options. Options granted under the
Plan are not transferable by the optionee except by will or laws of descent and
distribution or to the optionee's spouse or lineal descendants, or trusts or
partnerships for their sole benefit.
(v) Amendment of Option Documents. The Committee may amend the
provisions of option documents issued to an optionee, subject to the optionee's
consent if the amendment is not favorable to the optionee.
(g) Amendments of the Plan. The Board of Directors or the Committee
may, in their discretion, amend, modify or terminate the Plan at any time and
from time to time, but may not, without obtaining shareholder approval within
twelve months before or after such action, change the class of individuals
eligible to receive an Incentive Stock Option or increase the maximum number of
Plan Shares (other than as a result of an adjustment in the event of a stock
dividend, stock split, recapitalization or certain other capital adjustments),
or make another change or amendment as to which shareholder approval is required
in order to satisfy the conditions set forth in Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended. No amendment or modification to the
Plan shall adversely affect any outstanding option, without the consent of the
optionee.
2. FEDERAL INCOME TAX MATTERS
The following discussion is intended to point out the general
principles of current federal income tax law applicable to the options and
restricted stock.
(a) Incentive Stock Options.
Incentive Stock Options granted under the Plan are intended to qualify
for the favorable federal income tax treatment currently accorded "Incentive
Stock Options" as defined under Section 422 of the Code.
Under the Code, generally no federal income tax is imposed at the time
an Incentive Stock Option is granted or exercised. While ordinarily no income is
required to be recognized at the time an Incentive Stock Option is exercised, it
should be noted that, for purposes of the alternative minimum tax, an Incentive
Stock Option is treated as a Non-Qualified Stock Option. Accordingly, the excess
of the fair market value of the shares of stock subject to the Incentive Stock
Option, determined at the time of exercise, over the exercise price
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constitutes ordinary income for purposes of the alternative minimum tax. If an
optionee disposes of stock acquired pursuant to the exercise of an Incentive
Stock Option within the same taxable year as the exercise of such option, then
the amount of ordinary income recognized for alternative minimum tax purposes is
the lesser of (i) the excess of the fair market value of the shares over the
exercise price at the time the option is exercised, and (ii) the excess of the
amount realized on the sale of such stock by the optionee over the exercise
price. Accordingly, the exercise of an Incentive Stock Option by an optionee may
cause the optionee to incur some alternative minimum tax. For purposes of the
alternative minimum tax, the basis of stock acquired through the exercise of an
Incentive Stock Option is equal to the fair market value taken into account in
determining the amount of ordinary income recognized for alternative minimum tax
purposes.
If the shares of stock acquired upon the exercise of an Incentive Stock
Option are not disposed of (i) within two years after the date of the grant of
the Incentive Stock Option, or (ii) within one year after the exercise of the
Incentive Stock Option, then, generally, any gain realized upon the sale or
other disposition of such shares will be treated as long-term capital gain.
These holding periods are not applicable to Incentive Stock Options exercised
after the death of an optionee by his estate or a person who acquired the right
to exercise such Incentive Stock Option by reason of the death of the Optionee.
The optionee's tax basis, in shares of stock acquired upon the exercise
of an Incentive Stock Option, in the event that the entire exercise price is
paid in cash, is equal to the exercise price paid. In a case where the optionee
pays all or a portion of the exercise price in the form of shares of stock of
the Company already owned by him or her, in general, (i) the optionee will not
recognize any gain (or loss) with respect to the already-owned shares, but the
amount of the gain, if any, which is not so recognized will be excluded from the
optionee's bases in the new shares received, and (ii) the new shares received
will have a holding period that includes the holding period of the already-owned
shares. In the event the already-owned shares used to acquire new shares were
acquired pursuant to the exercise of an Incentive Stock Option, the optionee
will be treated as having made a Disqualifying Disposition (as defined below) of
the already-owned shares if the holding period requirements have not been
satisfied.
In the event an optionee sells or otherwise disposes of shares of stock
acquired upon the exercise of an Incentive Stock Option before the expiration of
two years after the grant of the Incentive Stock Option or before the expiration
of one year after the exercise of the Incentive Stock Option (a "Disqualifying
Disposition"), the lesser of (i) the excess of the fair market value of the
shares of stock at the time the Incentive Stock Option was exercised over the
exercise price of such shares, and (ii) the excess of the amount realized upon
such Disqualifying Disposition over the exercise price, is treated as ordinary
income at the time of the sale or other disposition. Any gain upon a
Disqualifying Disposition which is not treated as ordinary income will be
treated as long-term capital gain if the shares of stock have been held for a
period of more than one year prior to such disposition. The Company generally is
entitled to a tax deduction equal to the amount of ordinary income, if any,
recognized by the optionee upon a Disqualifying Disposition.
(b) Non-Qualified Stock Options.
Non-qualified Stock Options granted under the Plan will not qualify for
the favorable federal income tax treatment accorded Incentive Stock Options.
Generally, an optionee should not recognize any income for federal income tax
purposes at the time of the grant of a Non-Qualified Stock Option under the
Plan. Upon the exercise of a Non-Qualified Stock Option, the excess of the fair
market value of the shares of stock acquired pursuant to such exercise,
determined at the time of the exercise, over the exercise price, constitutes
ordinary income to the optionee. The Company generally is entitled to a
corresponding income tax deduction for the taxable year in which the optionee is
required to recognize such ordinary income.
Optionees who are subject to the short-swing profits rules of Section
16(b) of the Securities Exchange Act of 1934, as amended ("Section 16(b)"),
unless they elect within 30 days of exercising a Non-Qualified Stock Option to
be taxed as of the time of such exercise (on the basis of the fair market value
of the stock at the time of such exercise), are permitted to defer the
recognition of gain from the exercise until the earlier of (i) the expiration of
the six-month period described in such sales, or (ii) the first day on which the
sale of such stock at a profit will not subject such optionee to suit under
Section 16(b).
(c) Restricted Stock.
Generally, a participant who receives a grant of restricted stock will
recognize ordinary income with respect to such stock in the year or years in
which such stock ceases to be subject to forfeiture. The amount of ordinary
income recognized will be equal to the fair market value of the restricted stock
on the date it ceases to be subject to forfeiture. Notwithstanding the general
rule, a participant who receives restricted stock which is subject to forfeiture
may elect, within 30 days of the issuance of such stock, to include in his or
her taxable income for the year of issuance an amount equal to the fair market
value of such restricted stock at the date of such issuance. If a participant
makes this election, no additional ordinary income is required to be recognized
at the time the risk of forfeiture for such restricted stock lapses. However, in
the event that such participant actually forfeits the stock, such participant
may not deduct the amount previously included in income pursuant to the
election. Any dividends paid to a participant on restricted stock prior to the
lapse of the risk of forfeiture will be treated as ordinary income.
The Company will be entitled to a deduction with respect to a
restricted stock award in the year in which ordinary income is recognized by the
participant on account of such award. Such deduction will be equal to the amount
of ordinary income recognized by the
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participant with respect to such restricted stock.
(d) Relevance of Distinction Between Capital Gains and Ordinary Income.
Currently, the maximum rate of tax imposed on ordinary income is 39.6%
and the maximum marginal rate of tax imposed on long-term capital gains is 28%.
In addition to this difference in tax rates, the distinction between capital
gains and ordinary income is relevant for a number of reasons, including the
fact that capital losses only are deductible against capital gains and a limited
amount ($3,000) of ordinary income.
The above description is a partial summary of material provisions of
the 1993 Stock Incentive Plan and is qualified in its entirety by reference to
the 1993 Stock Incentive Plan, a copy of which will be sent without charge prior
to the Meeting to any shareholder requesting it from the Secretary of the
Company.
The affirmative vote of the holders of a majority of the Company's
Common Stock present at the meeting in person or by proxy is required to approve
the amendment to the Plan adopted by the Board as described above. THE BOARD OF
DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL OF THE ADOPTION OF
THE AMENDMENT TO THE 1993 STOCK INCENTIVE PLAN.
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of June 4, 1999, certain information with
respect to the beneficial ownership of the Common Stock by (i) each director of
the Company, (ii) each person who is known by the Company to beneficially own 5%
or more of the outstanding shares of Common Stock, (iii) the Company's executive
officers earning more than $100,000 in total compensation during the fiscal year
ended March 31, 1999, and (iv) all of the Company's executive officers and
directors as a group.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER (1) OWNED OWNED
---------------------------------------- ----- -----
<S> <C> <C>
Robert G. Levin (2,3).......................................................... 2,843,970 46.0%
Fuente Investment Partnership (2,4,5).......................................... 1,493,102 24.4
Carlos A. Fuente, Sr. (2,4,5,6)................................................ 1,524,938 24.8
Carlos P. Fuente, Jr. (2,4,5,6)................................................ 1,524,938 24.8
Marvin B. Sharfstein (6)....................................................... 254,582 4.0
Michael Pitkow (3,6)........................................................... 242,485 3.8
Jerry L. Cox (3).............................................................. 27,590 0.4
Harvey W. Grossman (6)......................................................... 31,836 0.5
Palisades Capital Management LLC............................................... 491,200 8.0
All directors and executive officers as a group (7 persons)
(3,6)...................................................................... 4,287,169 70.0%
</TABLE>
(1) Unless otherwise noted, the Company believes that all persons named in the
above table have sole voting and investment power with respect to the
shares beneficially owned. The address for Messrs. Levin, Pitkow, Cox,
Grossman and Sharfstein is 12270 Townsend Road, Philadelphia, Pennsylvania
19154, the address for the Fuente Investment partnership and Messrs. Fuente
is c/o Fuente Cigar Ltd., Zona Franca, Santiago, Dominican Republic. The
address for Palisades Capital Management LLC, is 1 Bridge Plaza, Suite 695,
Fort Lee, New Jersey 07024.
(2) The Fuente Investment Partnership and Robert G. Levin have entered into an
agreement which provides that Mr. Levin will vote all of his shares of
Common Stock for the election of two directors nominated by the Fuente
Investment Partnership (currently Carlos A. Fuente, Sr. and Carlos P.
Fuente, Jr.) and the Fuente Investment Partnership will vote all of its
shares of Common Stock for the remainder of the directors to be nominated
by Mr. Levin.
(3) Represents shares of Common Stock which may be acquired upon the exercise
of options granted by the Company to Messrs. Levin, Pitkow and Cox pursuant
to the 1997 Employee Stock Option Plan. Mr. Levin has received options to
purchase 53,060 shares of Common Stock of which options to purchase 17,686
shares of Common Stock have vested. Mr. Pitkow has received options to
purchase 26,530 shares of Common Stock of which options to purchase 8,843
shares of Common Stock have vested. Mr. Cox has received options to
purchase 26,530 shares of Common Stock of which options to purchase 8,843
shares of Common Stock have vested. The totals shown for all directors and
officers as a group do not include shares which may be purchased pursuant
to the options described in this footnote. If all these options were
exercised in full, all directors and officers as a group would beneficially
own an additional 106,120 shares of Common Stock, and collectively would
beneficially own shares representing 70.5% of all outstanding shares.
(4) The Fuente Investment Partnership is a Florida general partnership, the
partnership interests are beneficially owned by Carlos A. Fuente,
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Sr., Carlos P. Fuente, Jr., and Cynthia Fuente Suarez. Carlos P. Fuente,
Jr. and Cynthia Fuente Suarez are the children of Carlos A. Fuente, Sr.
(5) Carlos A. Fuente, Sr. and Carlos P. Fuente, Jr. are deemed the beneficial
owners of the shares of Common Stock owned by the Fuente Investment
Partnership. Also includes options to purchase 31,836 shares of Common
Stock each granted pursuant to the Non-Management Director Stock Plan.
(6) Represents shares of Common Stock which may be acquired upon the exercise
of options granted by the Company. Each of Mr. Fuente, Sr., Fuente Jr.,
Sharfstein and Grossman have received options to purchase 31,836 shares of
Common Stock each granted pursuant to the Non-Management Director Stock
Plan. In 1996, Messrs. Pitkow and Sharfstein received options to purchase
213,302 shares of Common Stock each. The totals shown for all directors and
officers as a group do not include shares which may be purchased pursuant
to the options described in this footnote. If all these options were
exercised in full, all directors and officers as a group would beneficially
own an additional 553,948 shares of Common Stock, and collectively would
beneficially own shares representing 72.5% of all outstanding shares.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers and directors, and person who own more than ten
percent of its Common Stock, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and NASDAQ. Such persons
are required by regulation to furnish the Company with copies of all Section
16(a) forms they file. Based upon its involvement in the preparation of certain
of such forms, a review of the copies of other such forms received by it and the
written representations from certain reporting entities that no Form 5 was
required for each such entity, the Company believes that with respect to the
fiscal year ended March 31, 1999 all such Section 16(a) filing requirements were
satisfied.
CERTAIN TRANSACTIONS
Relationships with Fuente Cigar Ltd. and Related Parties. In the fiscal years
ended March 31, 1998 and 1999, the Company purchased approximately $9.3 million
and $11.0 million, respectively, of premium cigars from Fuente Cigar Ltd.
("Fuente Cigar"), representing approximately 64.2% and 70.0% respectively, of
premium cigar purchases for such periods. At March 31, 1999, approximately
$860,000 was due to Fuente Cigar for premium cigars sold to the Company. Two of
the principal executive officers of Fuente Cigar, Carlos A. Fuente, Sr. and
Carlos P. Fuente, Jr., are directors of the Company and a related family
partnership owns approximately 24.4% of the shares of the outstanding Common
Stock of the Company. Robert G. Levin, Chairman of the Board, Chief Executive
Officer and President of the Company and an affiliate of Fuente Cigar had
previously entered into a consulting agreement whereby such affiliate paid Mr.
Levin the sum of $50,000 per year for consulting services. This agreement has
been terminated. The Company has entered into two agreements with Fuente Cigar,
a Private Label Manufacturing Agreement ("PLMA") and an Exclusive
Distributorship Agreement.
Private Label Manufacturing Agreement. The Company entered into the
PLMA with Fuente Cigar in April 1997 whereby Fuente Cigar agreed to
sell the Company a minimum of 5 million premium cigars per year for
an initial term of ten years and the Company agreed to use its best
reasonable efforts to purchase at least 5 million premium cigars
during each year of the term of the PLMA. In addition, Fuente Cigar
has agreed to use its best reasonable efforts to sell to the
Company premium cigars in excess of the 5 million per year. The
premium cigars supplied by Fuente Cigar pursuant to the PLMA
include the Company's proprietary Ashton and Holt's brand premium
cigars, as well as other premium cigars manufactured by Fuente
Cigar under its trademarks, and comprise those brands in such
amounts, sizes and shapes as determined by Fuente Cigar. Fuente
Cigar supplied the Company with 3.3 million premium cigars in the
fiscal year ended March 31, 1997, 4.6 million premium cigars in the
fiscal year ended March 31, 1998 and 6.0 million premium cigars for
the fiscal year ended March 31, 1999. The purchase price for
premium cigars delivered under the PLMA is set by Fuente Cigar at
the market price in effect from time to time. The PLMA specifies
that while the Company owns the trademark to the name Ashton,
Fuente Cigar owns the formula used to blend the tobacco contained
in the Ashton cigars. The PLMA permits noncompliance with the
obligations of Fuente Cigar to sell 5 million premium cigars per
year for various reasons, including but not limited to, a shortage
of labor or the inability to secure materials and supplies at
reasonable prices. The PLMA provides that it is to be interpreted
and enforced under Florida law. However, the agreement specifically
prohibits any actions for specific performance and damages in the
event of a breach of the PLMA by Fuente Cigar. In the event that a
competitor of Fuente Cigar were to acquire control of the Company,
Fuente Cigar may, after the expiration of an eight month period
commencing on the date of such change in control, give notice of
the termination of the PLMA effective one year from the date of
such notice. If Fuente Cigar does not give such notice, the PLMA
will automatically be renewed for successive one year terms
provided neither party gives notice of termination.
Exclusive Distributorship Agreement. In September 1997, the
Company and Fuente Cigar entered into an exclusive distributorship
agreement whereby Fuente Cigar agreed to develop with the Company
up to three new premium cigar brands to be manufactured by Fuente
Cigar, and to be exclusively distributed by the Company on a
worldwide basis. Cigars manufactured for the Company under this
agreement will be applied to the annual minimum requirement under
the PLMA. The initial term of this agreement expires on August 31,
2007. The Company is obligated to use its best reasonable efforts
to
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<PAGE> 9
promote these new brands. Under the terms of this agreement,
Fuente Cigar manufactured and the Company launched the brand
"Premium Dominicana" during the summer of 1998. Fuente Cigar
supplied the Company with 628,000 Premium Dominicana cigars during
the fiscal year ended March 31, 1999.
Shareholders' Agreement. The Fuente Investment Partnership and Robert G. Levin
have entered into an agreement which provides that Mr. Levin will vote all of
his shares of Common Stock for the election of two directors nominated by the
Fuente Investment Partnership (currently Carlos A. Fuente, Sr. and Carlos P.
Fuente, Jr.) and the Fuente Investment Partnership will vote all of its shares
of Common Stock for the remainder of the directors to be nominated by Mr. Levin
including Messrs. Grossman and Pitkow. This agreement also requires unanimous
approval by the Company's Board of Directors prior to the issuance of any
preferred stock. In addition, the agreement grants each party a right of first
refusal on sales of Common Stock by the other party and provides for each party
to participate on a percentage basis in any transaction involving the sale of
Common Stock. This agreement also provides for the Fuente Investment Partnership
to have the right to acquire all of the shares of Common Stock, upon the death
of permanent disability of Mr. Levin, and for Mr. Levin to have the right to
purchase all of the shares of Common Stock owned by the Fuente Investment
Partnership upon the death or permanent disability of the last of Carlos A
Fuente, Sr., Carlos P. Fuente, Jr. and Cynthia Fuente Suarez.
Philadelphia Retail Store Lease. The Company currently leases from Robert G.
Levin the entire two-story building comprising approximately 4,700 square feet
in which the Company's Center City Philadelphia retail store is located. The
Company's retail store occupies 3,000 square feet on the street level, and the
Company sublets approximately 1,700 square feet on the second floor to an
unrelated third party. The Company paid approximately $75,000 and $75,000 to Mr.
Levin under this lease in the fiscal years ended March 31, 1998 and 1999,
respectively. The Company and Mr. Levin recently negotiated an extension of the
term of this lease through May 31, 2009. The rent payable to Mr. Levin prior to
the extension was $6,250 per month, or $75,000 per year, which was increased to
the current market rental of $10,000 per month, or $120,000 per year.
Loan to Shareholder. In May, 1999, the Company loaned Mr. Levin the sum of
$700,000 secured by a pledge of the Company's Common Stock owned by Mr. Levin
and equal in current market value to 150% of the outstanding principal balance
of this loan from time to time. This loan is for a term of five years, and is
payable interest only, at an annual rate of 6.00% in semi-annual installments.
All of the foregoing transactions between the Company and the foregoing
persons and entities were on substantially the same terms and conditions as if
such transactions would have been entered into with unrelated third parties. The
Company has a policy that any future transactions between it and any of its
officers, directors, principal stockholders or the affiliates of the foregoing
persons be on terms no less favorable to the Company that could reasonably be
obtained in arm's length transactions with the independent third parties, and
that any such transactions also be approved by a majority of the Company's
directors who are disinterested in the transaction.
The information given in this Proxy Statement with respect to the five
year business experience of each director, beneficial ownership of stock,
interlocks and the respective interests of persons in transactions to which the
Company or any of its subsidiaries was a party (other that as appears from the
records of the Company), is based upon statements furnished to the Company by
its directors and officers.
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Compensation
Committee") comprises Messrs. Sharfstein and Grossman, neither of whom are
officers or employees of the Company. The Compensation Committee's duties
include the design, implementation and administration of the Company's
compensation and benefits policies and practices for executive officers and key
managerial employees. In accordance with the rules established by the Securities
and Exchange Commission (the "SEC"), the Company is required to provide certain
data and information in regard to the compensation provided to the Company's
Chief Executive Officer and certain other highly compensated executive officers.
The Compensation Committee has prepared the following report for inclusion in
this Proxy Statement.
Compensation Policies. The Company's executive compensation program is designed
to attract, retain and motivate the management talent necessary to achieve the
Company's business objectives and to maximize long-term profitability and
shareholder value. The program is designed to accomplish this objective through
plans that (i) motivate senior management; (ii) align senior management's
interests with those of the Company's shareholders by linking compensation to
the enhancement of long-term shareholder value; and (iii) provide an appropriate
level of base compensation for senior management.
Elements of Compensation. The key elements of the Company's compensation program
consist of fixed compensation in the form of base salary, and variable
compensation in the form of annual incentive compensation and stock option
awards. While these elements of compensation are considered independently, the
Compensation Committee also takes into account the full compensation package
offered by the Company to each executive, including pension benefits, insurance
and other benefits, as well as the compensation described below. Base Salary.
Base salaries for executive officers are determined based upon the Compensation
Committee's evaluation of the responsibilities of the position held, the
relevant experience of such individual, and by reference to the historical
levels of salaries paid by the Company.
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<PAGE> 10
Adjustments to each executive's base salary are based upon a periodic evaluation
of the performance of the Company and each executive officer, as well as the
financial results of the Company's business operations. The Compensation
Committee takes into account the effect of corporate transactions that have been
consummated during the relevant year and, where appropriate, also considers
non-financial performances measures. These may include increases in market
share, improvements in relations with customers, suppliers and employees, and
implementation of management plans and directives.
Annual Incentive Compensation Awards. The variable compensation payable annually
to executive officers (including the Chief Executive Officer) consists of two
parts, an annual or more periodic cash incentive award, and awards of stock
options under the Company's 1997 Employee Stock Option Plan. Cash incentive
awards are designed to provide an additional incentive for senior management to
perform their responsibilities, and represent a more immediate reward for
excellence in the execution of their responsibilities, as evidenced by the
financial performance of the Company.
Stock Option Awards. The other principal component of executives' compensation
is stock options, which are intended as a tool to attract, provide incentive to,
and retain those executives and other key employees who have made the greatest
contribution to the business of the Company, and who can have the greatest
effect on the long-term profitability of the Company. The exercise price of each
option granted under the Company's 1997 Employee Stock Option Plan (the "Stock
Option Plan") is the average closing price of the Common Stock on the five
trading days prior to the date of each grant, except for certain employees who
commenced their employment between November 24, 1997 (the date of the Company's
initial public offering of Common Stock) through July 1, 1998, who received
options with exercise prices equal to the initial public offering price of
$11.00 per share, which exercise price was above the then trading range of the
Common Stock. The Compensation Committee believes that these stock options more
closely align the grantees interests with those of its stockholders, and focus
management on increasing profitability and long-term shareholder value. Messrs.
Levin, Pitkow and Cox were the only persons who received awards under this plan
during the fiscal year ended March 31, 1999. Mr. Levin was granted options to
purchase 53,060 shares of common stock at an exercise price of $7.49 per share,
Mr. Pitkow was granted options to purchase 26,530 shares of common stock at an
exercise price of $6.81 per share, and Mr. Cox was granted options to purchase
26,530 shares of common stock at an exercise price of $11.00 per share.
Deductibility of Compensation. The Compensation Committee has not adopted any
formal policy with respect to Section 162(m) of the Internal Revenue Code of
1986, as amended, which prohibits the deductibility of certain compensation paid
in excess of $1,000,000. While the Compensation Committee will continue to give
due consideration to the deductibility of compensation payments to the Company's
executive officers, the Compensation Committee will make its decisions based
upon an overall determination of what the Committee believes to be in the best
interests of the Company and its stockholders, and deductibility will be only
one among a number of factors to be considered by the Compensation Committee in
determining compensation matters.
Compensation of the Chief Executive Officer. Prior to the Company's initial
public offering of its Common Stock, the Company entered into a five year
employment agreement with Robert G. Levin, Chairman of the Board, President and
Chief Executive Officer of the Company, effective as of October 1, 1997 which
established a minimum base salary of $400,000, and which provides for annual
review by the Company with respect to increases. In addition to the increase in
salary as set forth in Mr. Levin's employment agreement, 53,060 options were
granted to Mr. Levin at an exercise price of $7.49 per share during the fiscal
year ended March 31, 1999. In addition to a cash incentive of $25,000, the
Compensation Committee recommended to the Board of Directors, and the Board of
Directors approved a $700,000 loan to Mr. Levin as described above in "Certain
Transactions".
EXECUTIVE OFFICERS AND EXECUTIVE COMPENSATION
The Executive Officers of the Company are as follows:
Robert G. Levin is the Chairman of the Board, Chief Executive Officer and
President of the Company. Mr. Levin has been engaged in the business of
the Company since 1972, and has been Chairman of the Board, Chief
Executive Officer and President since 1980.
Michael Pitkow joined the Company in October 1995 as Chief Operating
Officer and Executive Vice President and has been a Director of the
Company since September 1997. From 1985 through October 1995, Mr. Pitkow
was the owner of Pitkow Associates, a media service and marketing
communications company. From 1983 to 1985, Mr. Pitkow was general manager
of Cable AdNet, then Philadelphia's largest cable advertising
interconnect company.
Jerry L. Cox was appointed Chief Financial Officer of the Company
effective as of June 2, 1998. Prior to joining the Company, Mr. Cox was
the sole officer, director and shareholder of J. Lloyd Company, Inc., a
financial and general management consulting firm established in 1990.
During a ten month period in 1996, Mr. Cox served as Vice President of
Finance for Domestic Operations for National Media Corporation, an
infomercial company. From June 1997 through his appointment with the
Company, and in connection with services performed by J. Lloyd Company,
Inc., Mr. Cox served as acting Chief Financial Officer of Innovative Tech
Systems, Inc., a publicly traded facilities management software company.
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<PAGE> 11
The following table sets forth the annual and long-term compensation for
the Company's Chief Executive Officer and Executive Vice President, the
only executive officers of the Company whose total compensation exceeded
$100,000 in the last three fiscal years of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
SECURITIES
FISCAL SALARY BONUS OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR ($) ($) COMPENSATION OPTIONS/SARS COMPENSATION
- --------------------------- ---- --- --- ------------- ------------ ------------
($) (#) ($)(1)(2)
--- --- ---------
<S> <C> <C> <C> <C> <C> <C>
Robert G. Levin 1999 $442,308 $25,000 $27,379 53,060 $4,750
Chairman, CEO & President 1998 $421,286 $44,281 $4,750
1997 $335,973 $4,750
Michael Pitkow 1999 $195,769 $30,000 $ 2,732 26,530
COO & Exec. VP 1998 $154,780 $10,000 213,302
1997 $111,039 $ 5,000
Jerry L. Cox 1999 $ 84,000 $ 6,500 $ 2,917 26,530 $ 915
CFO, Treasurer
</TABLE>
(1) Pursuant to the Securities and Exchange Commission rules on executive
compensation disclosure, 'All Other Compensation' does not include
perquisites because the aggregate amount of such compensation for each of
the persons listed did not exceed the lesser of (i) $50,000 or (ii) ten
percent of the combined salary and bonus for such person in Fiscal 1997.
(2) Represents the Company's matching contribution pursuant to its 401(k)
defined contribution plan.
EMPLOYMENT AGREEMENTS
The Company has employment agreements with Messrs. Levin, Pitkow and Cox. Mr.
Levin's employment agreement, effective as of October 1, 1997, provides for a
minimum base salary of $400,000, to be reviewed at least annually and to be
adjusted based upon his performance, and has a term of five years. This
agreement is automatically renewed each year to maintain a five-year term if
neither party gives a notice of termination. Mr. Pitkow's employment agreement,
effective as of October 1, 1997, provides for a minimum base salary of $150,000
per year, to be reviewed at least annually, and expires on March 31, 2000. Mr.
Cox's employment agreement, effective as of June 2, 1998, provides for a minimum
base salary of $104,000, to be reviewed annually. This employment agreement
expires on March 31, 2000.
STOCK PERFORMANCE GRAPHS
The following graph compares the percentage change in the Company's
Common Stock to the cumulative total return of the Standard & Poor's 500 Stock
Index and the Company's peer group for the Company's fiscal year ended March 31,
1999, assuming an investment of $100 on April 1, 1998.
[GRAPHIC]
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In the printed version of the document, a line graph
appears which depicts the following plot points:
<TABLE>
<CAPTION>
11/97 3/98 3/99
----- ---- ----
<S> <C> <C> <C>
Holt's Cigar Holdings $100.00 $71.59 $37.38
S & P 500 $100.00 $121.27 $143.66
Peer Group $100.00 $56.81 $29.84
</TABLE>
The performance of the Company's Common Stock reflected above is not
necessarily indicative of future performance of the Common Stock. The total
return on investment (change in year-end stock price plus reinvested dividends,
if any) for the period shown for the Company, the Standard & Poor's 500 Stock
Index and the Company's peer group is based upon the stock price or composite
index on March 31, 1999.
OTHER MATTERS
Selection of Independent Accountants. The Board of Directors has proposed, and
recommends the appointment of PricewaterhouseCoopers LLP as the independent
accountants of the Company for the current fiscal year, ending March 31, 2000.
The Board of Directors expects that a representative of PricewaterhouseCoopers
LLP will be present at the Annual Meeting with the opportunity to make a
statement if he desires to do so and will be available to respond to appropriate
questions.
Report on Form 10-K. The Company filed its annual report on Form 10-K for the
fiscal year ended March 31, 1999 with the Securities and Exchange Commission on
June 29, 1998. A copy of the report, including any financial statements and
schedules and a list describing any exhibits not contained therein, may be
obtained without charge by any stockholder. Written requests for copies of this
report should be directed to Investor Relations, Holt's Cigar Holdings, Inc.,
12270 Townsend Road, Philadelphia, PA 19154.
/s/ Michael Pitkow,
-------------------------------
Secretary
Philadelphia, Pennsylvania
June 29, 1999
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<PAGE> 13
HOLT'S CIGAR HOLDINGS, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS AUGUST 17, 1998
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Robert G. Levin and Michael
Pitkow, and each or either of them, proxies of the undersigned, with full power
of substitution, to vote all of the shares of Common Stock of Holt's Cigar
Holdings, Inc., (the "Company") which the undersigned may be entitled to vote at
the Annual Meeting of Stockholders of the Company to be held at the Radisson
Hotel Philadelphia Northeast, U.S. Route 1 at Old Lincoln Highway, Trevose, PA
19053 on August 17, 1999, at 10:00 a.m., local time, and at any adjournment
thereof as follows:
1. For the election of two directors, to serve until their successors are duly
elected, as described in the accompanying Proxy Statement.
FOR all nominees listed / / WITHHOLD authority to vote for / /
(except as marked to all nominees listed below.
the contrary below).
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A
LINE THROUGH THAT NOMINEE'S NAME.
Carlos P. Fuente, Jr. Marvin B. Sharfstein
2. PROPOSAL TO RATIFY appointment of PricewaterhouseCoopers LLP as the Company's
independent accountants for the fiscal year ending March 31, 2000.
/ / FOR / / AGAINST / / ABSTAIN
3. PROPOSAL TO APPROVE the increase in the number of shares of the Company's
common stock subject to the Company's 1997 Employee Stock Option Plan by
100,000.
/ / FOR / / AGAINST / / ABSTAIN
The Board of Directors recommends a vote FOR the election of the nominees listed
above and FOR proposals 2 and 3.
(CONTINUED ON REVERSE SIDE)
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<PAGE> 14
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the meeting and any adjournment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED. IF A CHOICE IS NOT SPECIFIED, THE PROXY
WILL BE VOTED FOR THE ELECTION OF THE NOMINEES FOR DIRECTOR AND FOR PROPOSAL 2.
DATED: _____________________ , 1999
Signature
Signature if held jointly
Note: This proxy should be dated and signed by the
stockholder exactly as his name appears hereon. When shares
are held by joint tenants, both should sign. When signing
as an 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.
PLEASE, MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
PRE-PAID ENVELOPE.
14
