<PAGE>
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:
[_] CONFIDENTIAL, FOR USE OF THE
[_] Preliminary Proxy Statement COMMISSION ONLY (AS PERMITTED BY
RULE 14A-7(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
APEX MORTGAGE CAPITAL, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
N/A
(NAME OF PERSON(S) FILING PROXY STATEMENT IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] ($125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transactions:
(5) Total fee paid:
[_] Fee paid previously by written preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
[LOGO OF APEX MORTGAGE CAPITAL, INC.]
NOTICE OF
ANNUAL MEETING
OF SHAREHOLDERS
AND
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
JULY 1, 1998
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Holders of Shares of Common Stock of Apex Mortgage Capital, Inc.:
The 1998 Annual Meeting of Shareholders of Apex Mortgage Capital, Inc. will
be held on July 1, 1998 at the offices of Apex Mortgage Capital, Inc. at 865
South Figueroa Street, Los Angeles, California 90017 on the 18th floor in the
La Brea Room at 9:00 a.m. Pacific Time, for the following purposes:
. To ratify the appointment of Deloitte & Touche LLP, independent public
accountants, as auditors for the current year; and
. To take action on other business that may properly come before the meeting.
To assure your representation at the meeting, please mark, sign and date your
proxy card and return it in the envelope provided after reading the accompanying
proxy statement.
Michael E. Cahill
Secretary
Los Angeles, California
April 30, 1998
YOUR VOTE IS IMPORTANT.
PLEASE PROMPTLY DATE, SIGN AND RETURN
YOUR PROXY IN THE ENCLOSED ENVELOPE.
<PAGE>
April 30, 1998
PROXY STATEMENT
----------------
GENERAL INFORMATION
This proxy statement and accompanying proxy card are being mailed to
shareholders beginning on or about May 15, 1998 in connection with the
solicitation of proxy cards by the Board of Directors of Apex Mortgage
Capital, Inc. (hereinafter referred to as the "Company") for use at the 1998
Annual Meeting of Shareholders. The principal office of the Company is located
at 865 South Figueroa Street, Los Angeles, California 90017.
Holders of record of Company common stock at the close of business on April
30, 1998 are entitled to notice of and to vote at the meeting. At the close of
business on April 24, 1998 there were 6,453,000 shares of common stock
outstanding, each of which entitles its holder to one vote.
THE BOARD OF DIRECTORS SOLICITS AND RECOMMENDS YOUR EXECUTION OF THE
ENCLOSED PROXY CARD. You may revoke your proxy card at any time prior to it
being used at the meeting by submission of a later proxy, giving notice in
writing to the Secretary of the Company or voting in person.
Shares for which a properly signed proxy card are received will be
represented at the Annual Meeting and will be voted as instructed on the proxy
card. Shareholders are urged to specify their choices by marking an "X" in the
appropriate box on the proxy card. If no choices are specified, the shares
represented will be voted as recommended by your Board of Directors. Shares
represented by improperly marked proxy cards will be treated as abstentions
for voting purposes. "Votes cast" is defined to include both for and against
votes but excludes abstentions and broker non-votes.
The presence in person or by proxy of the holders of record of fifty percent
(50%) of shares entitled to be voted will constitute a quorum at the Annual
Meeting. For the purpose of determining a quorum, all shares represented at
the meeting are counted without regard to abstentions or broker non-votes.
The enclosed proxy is solicited by the Board of Directors of the Company.
The cost of the solicitation will be borne by the Company. Proxy solicitations
will be made by mail, and may also be made by personal interview, telephone,
facsimile transmission and telegram on behalf of the Company by directors and
officers of the Company. Banks, brokerage houses, nominees and other
fiduciaries will be requested to forward the proxy soliciting materials to the
beneficial owners and obtain authorization for the execution of proxies. The
Company may reimburse brokers, banks and other fiduciaries for postage and
reasonable expenses incurred by them in the forwarding of proxy material to
beneficial owners of stock. The Company does not expect to engage an outside
firm to solicit proxies.
1
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows shares of stock beneficially owned as of April 24,
1998 by all Directors, Executive Officers and all Directors and Officers as a
group. At April 24, 1998, as far as known to the Company, no person owned 5%
or more of the Company's outstanding voting securities.
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
CLASS SHARES VOTING
NAME OF OF BENEFICIALLY SECURITIES
BENEFICIAL OWNER STOCK OWNED OUTSTANDING(1)
---------------- ------ ------------ --------------
<S> <C> <C> <C>
Peter G. Allen........................... Common 0 0.00%
John C. Argue............................ Common 1,500 0.02%
Philip A. Barach......................... Common 20,200 0.31%
Michael E. Cahill........................ Common 0 0.00%
Joseph J. Galligan....................... Common 0 0.00%
John A. Gavin............................ Common 0 0.00%
Carl C. Gregory, III..................... Common 0 0.00%
Jeffrey E. Gundlach...................... Common 15,000 0.23%
Daniel K. Osborne........................ Common 15,000 0.23%
Marc I. Stern............................ Common 16,666 0.26%
All Directors and Officers as a Group.... Common 68,366 1.06%
</TABLE>
- --------
(1)Based on 6,453,000 shares of common stock issued and outstanding as of
April 24, 1998.
DIRECTORS AND EXECUTIVE OFFICERS
PETER G. ALLEN, 39, has been an unaffiliated director of the Company since
December 1997. Mr. Allen is an investment banker who now works as an
independent investor and advisor. Previously, he worked at Morgan Stanley &
Co. Incorporated for 15 years where he was the Managing Director responsible
for the firm's investment banking operations in the southwestern United
States. During his tenure at Morgan Stanley, Mr. Allen advised a number of
companies in a wide variety of strategic and financial transactions. Mr. Allen
was also the Managing Partner at Chartwell Partners from January 1997 through
July 1997. Mr. Allen received his B.A. degree in economics, summa cum laude,
at Yale University in 1980 and his M.B.A. degree at Stanford University in
1984.
JOHN C. ARGUE, 66, has been an unaffiliated director of the Company since
December 1997. Mr. Argue is Of Counsel to the law firm of Argue Pearson
Harbison & Myers. Mr. Argue is also a Director of Avery Dennison Corporation,
CalMat Company and Nationwide Health Properties Inc. He is an advisory
director of LAACO Ltd. Mr. Argue is also a director of the TCW Galileo Family
of Funds, the TCW Convertible Securities Fund, Inc. and a trustee of the
TCW/DW Family of Funds. He is Chairman of the Rio Hondo Foundation.
PHILIP A. BARACH, 45, is President, Chief Executive Officer and has been an
affiliated director of the Company since October 1997. Mr. Barach is also a
Group Managing Director and Chief Investment Officer of Investment Grade Fixed
Income of The TCW Group, Inc. ("TCW") and its subsidiaries and affiliates
("TCW Group") and TCW Investment Management Company (the "Manager"). Mr.
Barach is a member of the TCW Group's Mortgage Backed Securities Group (the
"MBS Group"). Mr. Barach joined TCW in 1987 after being employed by Sun Life
Insurance Company, where he was Senior Vice President and Chief of
Investments. Previously, Mr. Barach served as head of Fixed Income Investments
for the State of California Retirement System. Mr. Barach attended the Hebrew
University of Jerusalem, where he received a B.A. degree in International
Relations and an M.B.A. degree in Finance.
JOHN A. GAVIN, 67, has been an unaffiliated director of the Company since
December 1997. Mr. Gavin is founder and chairman of Gamma Services Corporation
and a principal of Gavin, Dailey and Partners, both international capital and
consulting firms. Since 1995, he has been affiliated with Hicks, Muse, Tate &
Furst
2
<PAGE>
(Latin America) as Managing Director. Mr. Gavin is a member of the board of
directors of Atlantic Richfield Company (ARCO), Dresser Industries,
Pinkerton's, Inc., International Wire Group, Fedco, Inc., and KAP Resources.
Mr. Gavin is also a trustee of Hotchkis & Wiley Funds. From 1981 to 1986, Mr.
Gavin was the United States Ambassador to Mexico. Mr. Gavin graduated from
Stanford University with a degree in Economic History of Latin America.
CARL C. GREGORY, III, 53, has been an unaffiliated director of the Company
since December 1997. Mr. Gregory has been Managing Partner of American Western
Partners since 1995. He was Chairman, Chief Executive Officer and a Director
of MIP Properties, Inc. from 1991 through 1995. Prior to 1991, Mr. Gregory was
President of American Western Realty Corporation. Mr. Gregory has been
Chairman of the Board of Directors of West Capital Financial Services Corp.
since 1996, a Director of Pacific Gulf Properties, Inc. since 1997 and a
Director of House of Fabrics since 1996. Mr. Gregory received a B.A. degree in
Accounting from Southern Methodist University and an M.B.A. degree in Finance
from the University of Southern California.
JEFFREY E. GUNDLACH, 38, is Chief Investment Officer, Vice Chairman and has
been an affiliated director of the Company since October 1997. Mr. Gundlach is
a Group Managing Director of the TCW Group and the Manager. Mr. Gundlach has
been with the TCW Group since 1985. Previously, Mr. Gundlach was employed by
Transamerica Corporation's Property/Casualty Insurance division, where he was
a Senior Loss Reserve Analyst responsible for investment discount and funding
strategies. Mr. Gundlach is also a member of the TCW Group's MBS Group. Mr.
Gundlach is a graduate of Dartmouth College, holding B.A. degrees in
Mathematics and Philosophy (summa cum laude). He also attended Yale University
as a Ph.D. candidate in Mathematics.
MARC I. STERN, 54, is Chairman and has been an affiliated director of the
Company since September 1997. Mr. Stern is Vice Chairman of the Board of
Directors of the Manager and TCW Asset Management Company and a Director of
TCW, Trust Company of the West and TCW Funds Management, Inc. ("TFMI"). Mr.
Stern is also President of TCW and TFMI and Executive Vice President and Group
Managing Director of Trust Company of the West. Mr. Stern is responsible for
the TCW Group's international operations and is Chairman of TCW Americas
Development, Inc., TCW Asia Limited and TCW London International, Limited. Mr.
Stern joined the TCW Group in 1990. Previously, Mr. Stern was President of
Broad, Inc., Managing Director and Chief Administrative Officer of the Henley
Group, Inc. and Senior Vice President of Allied-Signal, Inc. and related
entities. Prior to holding such positions, Mr. Stern was associated with the
law firm of Debevoise & Plimpton. Mr. Stern is also Director of Qualcomm, Inc.
and the Los Angeles Music Center Opera, and a member of the Board of Trustees
of The Salk Institute and Dickinson College. Mr. Stern is a member of the
State Bars of New York and New Hampshire. Mr. Stern received a B.A. degree in
Political Science from Dickinson College, an M.A. degree in Political Science
from the Columbia University School of Public Law and Government, and a J.D.
degree from the Columbia University School of Law.
BIOGRAPHICAL INFORMATION REGARDING EACH EXECUTIVE OFFICER WHO IS NOT A
DIRECTOR IS SET FORTH BELOW:
DANIEL K. OSBORNE, 33, has been Executive Vice President, Chief Operating
Officer and Chief Financial Officer of the Company since September 1997. Mr.
Osborne is also a Senior Vice President of the TCW Group and the Manager. Mr.
Osborne joined the TCW Group in 1994 as part of the MBS Group, managing fixed
income mutual funds. Prior to joining TCW, from 1992 to 1994, Mr. Osborne was
a Vice President of ASR Investments Corporation ("ASR"), a publicly held REIT
investing in Mortgage Assets. At ASR, Mr. Osborne was responsible for
asset/liability management and the supervision and preparation of public
reporting. Prior to his employment with ASR, Mr. Osborne was a Certified
Public Accountant with Deloitte & Touche LLP specializing in REITs, mortgage
securities and publicly held companies. He holds a B.S. degree in Accounting
from Arizona State University.
JOSEPH J. GALLIGAN, 39, has been Senior Vice President of the Company since
September 1997. Prior to joining the TCW Group in 1991, Mr. Galligan was a
Vice President at Smith Barney in the Mortgage-Backed Specialist Group. Prior
to that, he spent five years at First Boston as Vice President in the same
area. In addition, Mr. Galligan spent over three years at Scudder Stevens &
Clark as a Portfolio Manager/Trader. He holds a
3
<PAGE>
B.S. degree in Economics with a concentration in Finance from the Wharton
School of Business at the University of Pennsylvania. Mr. Galligan is a
Chartered Financial Analyst.
MICHAEL E. CAHILL, 47, has been Secretary of the Company since September
1997. Mr. Cahill is a Managing Director and General Counsel of the Manager,
TCW and certain of its Affiliates. Prior to joining the TCW Group in 1991, Mr.
Cahill was Senior Vice President and General Counsel of Act III
Communications. Previously, he was in private corporate law practice with
O'Melveny & Myers and, prior to that, with Shenas, Robbins, Shenas & Shaw in
San Diego. He is a member of the State Bar of California and of the Province
of Ontario and is admitted to various courts, including the U.S. Supreme
Court. Mr. Cahill holds B.A. degrees in Mathematics and Philosophy from
Bishops University, Quebec, an LL.M. degree from Harvard University and an
LL.B. degree from Osgoode Hall Law School, York University, Toronto.
PHILIP K. HOLL, 48, has been Assistant Secretary of the Company since
December 1997. Mr. Holl joined the TCW Group in 1994 and is Vice President and
Associate General Counsel of Trust Company of the West, TCW Asset Management
Company and TCW Funds Management, Inc. Prior to joining the TCW Group, Mr.
Holl was General Counsel and Secretary to The Reserve Group of Mutual Funds
(New York). Mr. Holl received a B.A. in Economics from Rutgers College, a J.D.
from the Rutgers University School of Law (Camden) and a LL.M. from the New
York University School of Law.
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 and executive officers, and holders of more than 10% of the
Company's Common Stock, to file with the Securities and Exchange Commission
(the "SEC") initial reports of ownership and reports of changes in ownership
of Common Stock and other equity securities of the Company. Such officers,
directors and 10% stockholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file. Based solely on its
review of such forms that it received, or written representations from
reporting persons that no Form 5's were required for such persons, the Company
believes that, during fiscal 1997, all Section 16(a) filing requirements were
satisfied on a timely basis.
EXECUTIVE COMPENSATION
The Company has not paid, and does not intend to pay, any annual
compensation to the Company's executive officers for their services as
executive officers. However, the Company may from time to time, at the
discretion of the compensation committee of the Board of Directors, grant
options to purchase shares of the Company's common stock to the executive
officers and directors pursuant to the Company's Stock Option Plan.
4
<PAGE>
STOCK OPTIONS GRANTED AND OUTSTANDING
The following table represents the total number of stock options granted to
executive officers of the Company during the year ended December 31, 1997.
STOCK OPTIONS GRANTED DURING YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
AT ASSUMED ANNUAL
RATES OF STOCK
NUMBER OF PERCENT OF PRICE
SECURITIES TOTAL APPRECIATION FOR
UNDERLYING OPTIONS EXERCISE OPTION TERM(3)
OPTIONS GRANTED TO PRICE(2) EXPIRATION -----------------
NAME GRANTED(1) EMPLOYEES ($/SHARE) DATE 5% ($) 10% ($)
- ---- ---------- ---------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Philip A. Barach........ 40,000 25.8% $15.00 12/3/07 $377,337 $956,247
Jeffrey E. Gundlach..... 40,000 25.8% 15.00 12/3/07 377,337 956,247
Daniel K. Osborne....... 35,000 22.6% 15.00 12/3/07 330,170 836,715
Joseph J. Galligan...... 25,000 16.1% 15.00 12/3/07 235,835 597,653
Michael E. Cahill....... 15,000 9.7% 15.00 12/3/07 141,501 358,593
</TABLE>
- --------
(1) The options granted are exercisable starting 14 months after the date of
grant.
(2) The exercise price and tax withholding obligations incurred upon exercise
of the options may be paid by the option holder by delivering already
owned shares of Company Common Stock, including those which are issuable
upon exercise of the options.
(3) The dollar amounts under these columns are the result of calculations at
5% and 10% compounded annual rates set by the Commission, and therefore
are not intended to forecast future appreciation, if any, in the price of
common stock.
STOCK OPTIONS EXERCISED DURING LAST FISCAL YEAR
The following table represents the total number of stock options exercised
by executive officers of the Company during the year ended December 31, 1997,
and the value of unexercised options held by executive officers of the Company
as of December 31, 1997.
AGGREGATED OPTION EXERCISES IN 1997 AND
DECEMBER 31, 1997 OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
DECEMBER 31, DECEMBER 31,
1997 (#) 1997 ($)
SHARES ------------- -------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
- ---- -------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Philip A. Barach........ None Exercised 0 0/40,000 0/0(1)
Jeffrey E. Gundlach..... None Exercised 0 0/40,000 0/0(1)
Daniel K. Osborne....... None Exercised 0 0/35,000 0/0(1)
Joseph J. Galligan...... None Exercised 0 0/25,000 0/0(1)
Michael E. Cahill....... None Exercised 0 0/15,000 0/0(1)
</TABLE>
- --------
(1) The Company's common stock as of December 31, 1997 traded at a value less
than the options' exercise price; the reported options are therefore not
in-the-money options.
5
<PAGE>
COMPENSATION OF DIRECTORS
The Company pays an annual director's fee to each unaffiliated director of
$10,000, a fee of $1,250 for each meeting of the Board of Directors attended by
each unaffiliated director and reimbursement of costs and expenses of all
directors for attending such meetings. Affiliated directors are not separately
compensated by the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Board of Directors has established a Compensation Committee comprised
entirely of unaffiliated directors. Messrs. Allen, Argue, Gavin and Gregory
serve on the Compensation Committee. The Compensation Committee is responsible
for administering the Company's Stock Option Plan. No interlocking relationship
exists between the Company's Board of Directors or officers responsible for
compensation decisions and the board of directors or compensation committee of
any other company, nor has any such interlocking relationship existed in the
past.
TOTAL RETURN COMPARISON
The following graph presents a total return comparison of the Company's
common stock since the commencement of the Company's operations on December 4,
1997 through December 31, 1997, to the S&P Composite 500 Stock Index and the
Bloomberg Mortgage REIT Index. The total return reflects stock appreciation and
the value of dividends for the Company's common stock and for each of the
comparative indices. The information herein has been obtained from sources
believed to be reliable, but neither its accuracy nor its completeness is
guaranteed. The graph assumes that the value of the investment in the Company's
common stock and each index was $100 on December 4, 1997, the commencement of
the Company's operations, and that all dividends were reinvested. The total
return performance shown on the graph is not necessarily indicative of future
total return performance.
TOTAL RETURN COMPARISON SINCE COMMENCEMENT
OF TRADING DECEMBER 4, 1997
THROUGH DECEMBER 31, 1997
<TABLE>
<CAPTION>
12/4/97 12/31/97
------- --------
<S> <C> <C>
Apex Mortgage Capital, Inc................................ $100 $93.60
S&P Composite 500 Index................................... $100 $99.80
Bloomberg Mortgage REIT Index............................. $100 $89.00
</TABLE>
6
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In addition to being Chairman and a director of the Company, Mr. Stern is
Chairman and a director of TCW Investment Management Company (the "Manager").
Mr. Barach, in addition to being President, Chief Executive Officer and a
director of the Company is also a Group Managing Director of the Manager.
Mr. Gundlach, the Vice Chairman and Chief Investment Officer of the Company,
is also a Group Managing Director of the Manager. Mr. Osborne, in addition to
being Executive Vice President, Chief Operating Officer and Chief Financial
Officer of the Company, is also a Senior Vice President of the Manager. Mr.
Cahill, Secretary of the Company, is also General Counsel, Secretary and a
Managing Director of the Manager.
The Manager will receive annual base management compensation based on the
Average Net Invested Capital of the Company, payable monthly in arrears, equal
to 3/4 of 1% of Average Net Invested Capital. The term "Average Net Invested
Capital" means for any period (i) the arithmetic average of the sum of the
gross proceeds of the offerings of its equity securities by the Company, after
deducting any underwriting discounts and commissions and other expenses and
costs relating to such offerings, plus the Company's retained earnings (taking
into account any losses incurred) and any non-cash charges or reserves,
including depreciation, mark-to-market adjustments and unrealized credit loss,
computed by taking the average of such values at the end of each month during
such period, plus (ii) any unsecured debt approved by the unaffiliated
directors to be included in Average Net Invested Capital. For the period
December 9, 1997 to December 31, 1997 the Manager received a management fee of
$43,000 from the Company.
The Manager shall also be entitled to receive as incentive compensation for
each fiscal quarter, an amount equal to 30% of the Net Income of the Company,
before incentive compensation, in excess of the amount that would produce an
annualized Return on Equity equal to the Ten-Year U.S. Treasury Rate plus 1%.
The incentive compensation calculation and payment will be made quarterly in
arrears. The term "Return on Equity" is calculated for any quarter by dividing
the Company's Net Income for the quarter by its Average Net Worth for the
quarter. For purposes of calculating the incentive compensation payable, the
definition "Return on Equity" is not related to the actual distributions
received by stockholders or to an individual investor's actual return on
investment. For such calculations, the "Net Income" of the Company means the
taxable income of the Company (including net capital gains, if any) before the
Manager's incentive compensation, net operating loss deductions arising from
losses in prior periods and deductions permitted by the Internal Revenue Code
of 1986, as amended, in calculating taxable income for a REIT plus the effects
of adjustments, if any, necessary to record hedging and interest transactions
in accordance with generally accepted accounting principles. A deduction for
all of the Company's interest expenses for borrowed funds is taken into
account in calculating Net Income. "Average Net Worth" for any period means
the arithmetic average of the sum of the gross proceeds from any offering of
its equity securities by the Company, before deducting any underwriting
discounts and commissions and other expenses and costs relating to the
offerings, plus the Company's retained earnings (without taking into account
any losses incurred in prior periods) computed by taking the average of such
values at the end of each month during such period. For the period December 9,
1997 to December 31, 1997, no incentive compensation was paid to the Manager.
APPOINTMENT OF AUDITORS
Deloitte & Touche LLP, independent public accountants, have been appointed
as auditors by the Board of Directors of the Company to examine the books and
accounts of the Company for the year ending December 31, 1998. A
representative of Deloitte & Touche LLP is expected to attend the Annual
Meeting. This representative will have the opportunity to make a statement and
will be available to respond to appropriate questions raised at the meeting.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS ITEM.
7
<PAGE>
OTHER BUSINESS
Management does not intend to present and does not know that others will
present any other items of business at the Annual Meeting. However, if any
other matters properly come before the meeting, the appointed Proxies will
vote in their discretion.
ANNUAL REPORT
This proxy statement is accompanied by the mailing of the Annual Report to
Shareholders for the fiscal year ended December 31, 1997, which contains
financial and other information about the activities of the Company.
THE COMPANY WILL FURNISH TO A SHAREHOLDER, WITHOUT CHARGE, A COPY OF ITS
MOST RECENT ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION (FORM 10-
K) UPON RECEIPT OF A WRITTEN REQUEST TO MR. DANIEL K. OSBORNE, CHIEF FINANCIAL
OFFICER, APEX MORTGAGE CAPITAL, INC., 865 SOUTH FIGUEROA STREET, LOS ANGELES,
CALIFORNIA 90017.
PROPOSALS OF SECURITY HOLDERS
Notice is hereby given that any shareholder proposal intended to be
presented at the Annual Meeting of Shareholders on July 1, 1998 must be
received at the Company's principal office on or before May 25, 1998. Notice
is hereby given that any shareholder proposal intended to be presented at the
Annual Meeting of Shareholders in 1999 must be received at the Company's
principal office on or before March 28, 1999.
By Order of the Board of Directors
/s/ Michael E. Cahill
Michael E. Cahill
Secretary
Los Angeles, California
April 30, 1998
8
<PAGE>
PROXY APEX MORTGAGE CAPITAL, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
IN CONJUNCTION WITH THE 1998 ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints PHILIP A. BARACH and MARC I. STERN proxies
with power to act without the other and with full power of substitution, and
hereby authorizes them to represent and vote the shares of Common Stock of Apex
Mortgage Capital, Inc. held of record by the undersigned on April 30, 1998, as
directed on the reverse side and, in their discretion, on all other matters
which may properly come before the 1998 Annual Meeting of Shareholders to be
held on July 1, 1998, and at any adjournment or postponement thereof, as if the
undersigned were present and voting at the meeting.
Whether or not you expect to attend the meeting, you are urged to execute
and return this proxy, which may be revoked at any time prior to its use.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NO.1
Unless contrary instructions are given on the reverse, this Proxy shall be
voted according to the recommendations of the Board of Directors.
PROPOSAL NO. 1:
APPOINTMENT OF INDEPENDENT ACCOUNTANTS FOR [_] AGAINST [_] ABSTAIN [_]
(The Board of Directors recommends a vote FOR.)
I/WE PLAN TO ATTEND THE MEETING [_]
The undersigned acknowledges receipt
of the Notice of Annual Meeting of
Shareholders and of the Proxy
Statement.
Date:______________________, 1998
Signature(s) ________________________
Print Name(s):_______________________
Please print name(s) exactly as
it/they appear of record in
connection with those shares over
which you have voting authority.
Joint owners should each sign
personally. Where applicable,
indicate your official position or
representation capacity.
