<PAGE>
[LOGO]
B.H. (BARNEY) ADAMS
CHAIRMAN OF THE BOARD,
CHIEF EXECUTIVE OFFICER
AND PRESIDENT
April 5, 2000
Dear Adams Golf Stockholder:
I am pleased to invite you to Adams Golf's Annual Meeting of Stockholders.
The meeting will be held at 10:00 a.m. on Wednesday, May 3, 2000 at the Plano
Centre, 2000 East Spring Creek Parkway, Plano, Texas.
At the meeting, you and the other stockholders will be asked to (1) re-elect
two directors to the Adams Golf Board; (2) approve an increase in the number
of shares available for issuance under the Adams Golf 1998 Stock Incentive
Plan; and (3) ratify the appointment of KPMG LLP as our independent auditors
for the current fiscal year. You will also have the opportunity to hear what
has happened in our business in the past year and to ask questions. You will
find other detailed information about Adams Golf and its operations,
including its audited financial statements, in the enclosed Annual Report.
We hope you can join us on May 3rd. Whether or not you can attend, please
read the enclosed Proxy Statement. When you have done so, please MARK your
votes on the enclosed proxy, SIGN AND DATE THE PROXY, and RETURN it to us in
the enclosed envelope. Your vote is important, so please return your proxy
promptly.
Yours truly,
/s/ B.H. (Barney) Adams
B.H. (Barney) Adams
<PAGE>
[LOGO]
ADAMS GOLF, INC.
300 DELAWARE AVENUE, SUITE 572
WILMINGTON, DELAWARE 19801
April 5, 2000
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 3, 2000
Adams Golf will hold its Annual Meeting of Stockholders at the Plano Centre,
2000 East Spring Creek Parkway, Plano, Texas on Wednesday, May 3, 2000 at
10:00 a.m.
We are holding this meeting:
- to re-elect two Class II directors to serve until the 2003 Annual
Meeting of Stockholders;
- to approve an increase in the number of shares available for issuance
under Adams Golf's 1998 Stock Incentive Plan;
- to ratify the appointment of KPMG LLP as our independent auditors for
the year ending December 31, 2000; and
- to transact any other business that properly comes before the meeting.
Your Board of Directors has selected March 31, 2000 as the record date for
determining stockholders entitled to vote at the meeting. A list of
stockholders on that date will be available for inspection at Adams Golf,
2801 East Plano Parkway, Plano, Texas, for at least ten days before the
meeting.
This Notice of Annual Meeting, Proxy Statement, proxy and Adams Golf's 1999
Annual Report to Stockholders are being distributed on or about April 5, 2000.
By Order of the Board of Directors,
/s/ Richard H. Murtland
- ----------------------------
Richard H. Murtland
SECRETARY
<PAGE>
[LOGO]
ADAMS GOLF, INC.
PROXY STATEMENT
FOR MEETING TO BE HELD
MAY 3, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
GENERAL INFORMATION........................................................................................... 1
ITEM 1. ELECTION OF DIRECTORS................................................................................. 3
Nominees for Election to a Three-Year Term Ending with the 2003 Annual
Meeting............................................................................................... 3
Directors Continuing in Office Until the 2002 Annual Meeting of Stockholders............................. 4
Directors Continuing in Office Until the 2001 Annual Meeting of Stockholders............................. 4
Compensation of Directors................................................................................ 4
Committees of the Board of Directors; Meetings........................................................... 5
STOCK OWNERSHIP............................................................................................... 6
Beneficial Ownership of Certain Stockholders, Directors and Executive Officers........................... 6
Section 16(a) Beneficial Ownership Reporting Compliance.................................................. 7
MANAGEMENT.................................................................................................... 7
Executive Officers....................................................................................... 7
Compensation of Executive Officers....................................................................... 7
Employment Contracts and Change in Control Arrangements.................................................. 9
Compensation Committee Interlocks and Insider Participation.............................................. 10
Certain Transactions..................................................................................... 10
COMPENSATION COMMITTEE REPORT ON EXECUTIVE
COMPENSATION............................................................................................... 11
Compensation Policy...................................................................................... 11
1999 Company Performance................................................................................. 12
1999 Executive Compensation.............................................................................. 12
1999 Chief Executive Compensation........................................................................ 12
Company Policy on Qualifying Compensation................................................................ 13
PERFORMANCE GRAPH............................................................................................. 14
ITEM 2. APPROVAL OF PROPOSAL TO INCREASE THE NUMBER OF
SHARES AVAILABLE FOR ISSUANCE UNDER ADAMS GOLF'S 1998
STOCK INCENTIVE PLAN....................................................................................... 15
ITEM 3. RATIFICATION OF KPMG AS INDEPENDENT AUDITORS.......................................................... 19
ANNUAL MEETING ADVANCE NOTICE REQUIREMENTS.................................................................... 20
PLEASE SEE THE LAST PAGE OF THIS PROXY STATEMENT FOR DIRECTIONS TO THE ANNUAL MEETING.
</TABLE>
<PAGE>
GENERAL INFORMATION
1. WHO IS SOLICITING MY PROXY?
We, the Board of Directors of Adams Golf, are sending you this Proxy
Statement in connection with our solicitation of proxies for use at
Adams Golf's 2000 Annual Meeting of Stockholders. Certain directors,
officers and employees of Adams Golf also may solicit proxies on our
behalf by mail, phone, fax or in person.
2. WHO IS PAYING FOR THIS SOLICITATION?
Adams Golf will pay for the solicitation of proxies. Adams Golf will
also reimburse banks, brokers, custodians, nominees and fiduciaries for
their reasonable charges and expenses in forwarding our proxy materials
to the beneficial owners of Adams Golf common stock.
3. WHAT AM I VOTING ON?
Three items: (1) the re-election of Richard H. Murtland and John S.
Simpson to the Board of Directors; (2) the approval of a proposal to
increase the number of shares available under our 1998 Stock Incentive
Plan; and (3) the ratification of KPMG LLP as our independent auditors
for the current fiscal year.
4. WHO CAN VOTE?
Only those who owned common stock at the close of business on March 31,
2000, the record date for the Annual Meeting, can vote. If you owned
common stock on the record date, you have one vote per share for each
matter presented at the Annual Meeting.
5. HOW DO I VOTE?
You may vote your shares either in person or by proxy. To vote by
proxy, you should mark, date, sign and mail the enclosed proxy in the
enclosed prepaid envelope. Giving a proxy will not affect your right to
vote your shares if you attend the Annual Meeting and want to vote in
person - by voting you automatically revoke your proxy. You also may
revoke your proxy at any time before the voting by giving the secretary
of Adams Golf written notice of your revocation or by submitting a
later-dated proxy. If you execute, date and return your proxy but do
not mark your voting preference, the individuals named as proxies will
vote your shares FOR the election of both nominees for director, FOR an
increase in the number of shares available under Adams Golf's 1998
Stock Incentive Plan, and FOR ratification of KPMG as our independent
auditors.
6. WHAT CONSTITUTES A QUORUM?
Voting can take place at the Annual Meeting only if stockholders owning
a majority of the voting power of the common stock (that is a majority
of the total number of votes entitled to be cast) are present in person
or represented by effective proxies. On the record date, we had
22,480,071 voting shares of common stock outstanding. Both abstentions
and broker non-votes are counted as present for purposes of
establishing the quorum necessary for the meeting to proceed. A broker
non-vote results from a situation in which a broker holding
1
<PAGE>
your shares in "street" or "nominee" name indicates to us on a proxy
that it lacks discretionary authority to vote your shares.
7. WHAT VOTE OF THE STOCKHOLDERS WILL RESULT IN THE MATTERS BEING PASSED?
ELECTION OF DIRECTORS. Directors need the affirmative vote of holders
of a plurality of the voting power present to be elected. At this
year's meeting, the two nominees receiving the greatest number of votes
will be deemed to have received a plurality of the voting power
present. Neither abstentions nor broker non-votes will have any effect
on the election of directors.
APPROVAL OF PROPOSAL TO INCREASE THE NUMBER OF SHARES AVAILABLE FOR
ISSUANCE UNDER THE 1998 STOCK INCENTIVE PLAN. To approve this item,
stock-holders holding a majority of the shares represented in person,
or by proxy, at the meeting must affirmatively vote to approve the
matter. In this case, abstentions have the same effect as a vote
"against" the proposal, while broker non-votes have no effect at all.
RATIFICATION OF KPMG. Stockholders holding a majority of the shares
represented in person, or by proxy, at the upcoming Annual Meeting must
affirmatively vote to ratify KPMG as our independent auditors for the
current fiscal year. Abstentions continue to have the same effect as
votes "against" the proposal and broker non-votes continue to have no
effect at all.
8. HOW DOES THE BOARD RECOMMEND THAT WE VOTE ON THE MATTERS PROPOSED?
The Board of Directors of Adams Golf unanimously recommends that
stockholders vote FOR each of the proposals submitted at the upcoming
Annual Meeting.
9. WILL THERE BE OTHER MATTERS PROPOSED AT THE 2000 ANNUAL MEETING?
Adams Golf's Bylaws limit the matters presented at the upcoming Annual
Meeting to those in the notice of the meeting, those otherwise properly
presented by the Board of Directors and those presented by stockholders
so long as the stockholder gave the secretary written notice of the
matter on or before February 3, 2000. We do not expect any other matter
to come before the meeting. If any other matter is presented at the
Annual Meeting, your signed proxy gives the individuals named as
proxies authority to vote your shares in their discretion.
10. WHEN ARE 2001 STOCKHOLDER PROPOSALS DUE IF THEY ARE TO BE INCLUDED IN
THE COMPANY'S PROXY MATERIALS?
To be considered for presentation at Adams Golf's 2001 Annual Meeting
of Stockholders and included in the Company's proxy statement, a
stockholder proposal must be received at Adams Golf's offices no later
than December 8, 2000. To curtail controversy as to the date on which a
proposal was received by us, we suggest that proponents submit their
proposals by certified mail, return receipt requested.
2
<PAGE>
ITEM 1.
ELECTION OF DIRECTORS
The Board of Directors of Adams Golf has currently set the number of
directors constituting the whole board at seven. As established by our
Amended and Restated Certificate of Incorporation, these directors are
divided into three classes serving staggered three-year terms. At the
upcoming Annual Meeting, you and the other stockholders will elect two
individuals to serve as Class II directors whose term expires at the 2003
Annual Meeting. Both Mr. Murtland and Mr. Simpson are now members of the
Board of Directors. Roland E. Casati, previously a Class II director of Adams
Golf, retired from the Board in December 1999 and therefore will not be a
nominee for election.
The individuals named as proxies will vote the enclosed proxy for
the election of both nominees unless you direct them to withhold your votes.
If either nominee becomes unable to serve as a director before the meeting
(or decides not to serve), the individuals named as proxies may vote for a
substitute or we may reduce the number of members of the Board.
We recommend a vote FOR both nominees.
Below are the names and ages of the nominees for Class II director,
the Class I and Class III directors, the years they became directors, their
principal occupations or employment for at least the past five years, and
certain of their other directorships, if any.
NOMINEES FOR ELECTION TO A THREE-YEAR TERM ENDING WITH THE 2003 ANNUAL MEETING
CLASS II DIRECTORS
- - RICHARD H. MURTLAND -- AGE 59, A DIRECTOR SINCE APRIL 1996. Corporate
Secretary and Treasurer since August 1995. Vice President-Research and
Development of Adams Golf since April 1998; Vice President-Operations of
Adams Golf from May 1994 to April 1998; Project Manager of ARCO
International Oil and Gas Company from June 1976 to March 1994.
- - JOHN S. SIMPSON -- AGE 48, A DIRECTOR SINCE JULY 1998. Principal, John
Simpson Associates since January 1997; Senior Vice President, International
Management Group (UK) Inc. from June 1978 until December 1996.
Under the terms of an agreement between Adams Golf and Nick Faldo, the
Company has agreed that, for so long as royalties remain payable to Mr.
Faldo, it will cause a designee of Mr. Faldo to be nominated for, and
elected to, the Board. Mr. Simpson is currently Mr. Faldo's designee to the
Board.
3
<PAGE>
DIRECTORS CONTINUING IN OFFICE UNTIL THE 2002 ANNUAL MEETING OF STOCKHOLDERS
CLASS I DIRECTORS
- - ROBERT F. MACNALLY -- AGE 67, A DIRECTOR SINCE MAY 1999. Retired-Chairman
of the Board of Tommy Armour Golf Company from 1995 until 1997; President
and CEO of Tommy Armour Golf Company from 1979 to 1995. Also a director of
C.O. Tools, Inc.
- - STEPHEN R. PATCHIN -- AGE 41, A DIRECTOR SINCE OCTOBER 1993. President and
Chief Executive Officer of Royal Oil and Gas Corp. since June 1985;
President and Chief Executive Officer of Royal Holding Company, Inc. since
February 1990.
DIRECTORS CONTINUING IN OFFICE UNTIL THE 2001 ANNUAL MEETING OF STOCKHOLDERS
CLASS III DIRECTORS
- - B.H. (BARNEY) ADAMS -- AGE 61, A DIRECTOR SINCE 1987. Founder of Adams Golf
and our Chairman of the Board, Chief Executive Officer and President.
- - PAUL F. BROWN, JR. -- AGE 53, A DIRECTOR SINCE AUGUST 1995. Vice President,
Finance and Chief Financial Officer of Royal Holding Company, Inc. since
1990.
- - MARK R. MULVOY -- AGE 58, A DIRECTOR SINCE APRIL 1998. Retired-Managing
Editor of SPORTS ILLUSTRATED magazine from 1984 through 1996; Publisher of
SPORTS ILLUSTRATED magazine from 1990 to 1992. Also a director of Tosco
Corporation.
COMPENSATION OF DIRECTORS
Each non-employee director who serves as a member of the Board of
Directors for at least one month of each quarter receives a director fee of
$5,000 plus $1,000 per meeting attended in person or by telephone (whether of
the full Board or a committee thereof). In addition, each non-employee director
serving as a chairperson of any committee of the Board receives an additional
$1,000 per quarter provided such person serves in such capacity for at least one
month during that quarter. During the year ended December 31, 1999, we paid our
directors an aggregate of $139,000 in director fees. We also provided our
non-employee directors with Travel/Accidental Death and Dismemberment coverage
in the amount of $250,000.
Our directors are also entitled to participate in our 1998 Stock
Incentive Plan or our 1999 Non-Employee Director Plan, depending on their
status. During the year ended December 31, 1999, we issued the following stock
options to our directors:
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES EXERCISE
UNDERLYING PRICE EXPIRATION VALUE OF OPTIONS
NAME OPTIONS GRANTED PER SHARE DATE AT FISCAL YEAR END
- -------------------------------- --------------- ----------- ----------- ------------------
<S> <C> <C> <C> <C>
MARK R. MULVOY 10,000(1) $4.75 2/3/04 $0(2)
</TABLE>
- -----------
(1) Options granted February 3, 1999 and vest in four equal installments
beginning on the first anniversary of the grant date and continuing on
successive anniversaries thereafter.
(2) The option maintained an exercise price in excess of the fair market
value of the underlying common stock at 12/31/99.
4
<PAGE>
COMMITTEES OF THE BOARD OF DIRECTORS; MEETINGS
Adams Golf has two standing committees; namely, the Audit Committee
and the Compensation Committee.
THE AUDIT COMMITTEE
- Meets periodically with our independent auditors to review the
general scope of audit coverage, including consideration of our
accounting practices and procedures, our system of internal
accounting controls and financial reporting.
- Makes recommendations to the Board of Directors with respect to
the appointment of our independent auditors.
During the fiscal year ended December 31, 1999, the members of the
Audit Committee were Paul F. Brown, Jr., Finis F. Conner (until
February 4, 1999) and Robert F. MacNally. The Audit Committee met
twice in 1999.
THE COMPENSATION COMMITTEE
- Recommends to the Board of Directors annual salaries for senior
management.
- Recommends to the Board of Directors the administration and grant
of awards under Adams Golf's 1998 Stock Incentive Plan, 1999
Stock Option Plan for Outside Consultants, and Management
Incentive Plan.
During the fiscal year ended December 31, 1999, the members of the
Compensation Committee were Roland E. Casati, Mark R. Mulvoy and
Stephen R. Patchin. Mr. Casati retired from the Board of Directors in
December 1999. The Compensation Committee met twice in 1999.
ENTIRE BOARD
During the year ended December 31, 1999, the entire Board of Directors
of Adams Golf met five times. During fiscal 1999, each director
attended at least 75% of the total of all meetings of the Board of
Directors and any committee on which he served with exception of Mr.
Casati, who attended three of the seven meetings held.
5
<PAGE>
STOCK OWNERSHIP
BENEFICIAL OWNERSHIP OF CERTAIN STOCKHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS
This table shows, as of March 31, 2000, the beneficial ownership of
Adams Golf common stock by (1) each person known to us to be the beneficial
owner of more than 5% of our common stock; (2) each director; (3) each
executive officer named in the Summary Compensation Table on page 8; and (4)
all directors and executive officers as a group.
Except as noted, each person has sole voting and investment power over the
shares shown in this table.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
COMMON STOCK BENEFICIALLY OWNED (1)
------------------------------------------------------
NUMBER OF SHARES RIGHT TO PERCENT
NAME OF BENEFICIAL OWNERS BENEFICIALLY OWNED ACQUIRE (2) OF CLASS (3)
------------------------------------------------ ------------------ --------------- ---------------
<S> <C> <C> <C>
BENEFICIAL OWNERS OF 5% OR MORE
OF THE COMPANY'S COMMON STOCK
Royal Holding Company, Inc. (4)........... 6,374,511 0 28.4%
Finis F. Conner (5)....................... 1,554,221 0 6.9
Roland E. Casati (6)...................... 1,838,600 0 8.2
DIRECTORS AND NAMED EXECUTIVE OFFICERS
B.H. Adams................................ 3,205,219 0 14.3
Richard H. Murtland....................... 250,464 7,500 1.1
Paul F. Brown, Jr. (7).................... 6,379,511 0 28.4
Mark R. Mulvoy............................ 1,000 2,500 *
Stephen R. Patchin (7).................... 6,374,511 0 28.4
John S. Simpson (8)....................... 135,000 0 *
Robert F. MacNally........................ 100 0 *
Darl P. Hatfield.......................... 7,000 67,500 *
Oliver G. Brewer III...................... 10,000 27,500 *
ALL EXECUTIVE OFFICERS AND DIRECTORS AS A
GROUP (9 PERSONS)......................... 9,988,294 105,000 44.4
</TABLE>
- -------------------------------------
* Less than one percent.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities.
(2) Shares of common stock subject to options that are presently
exercisable or exercisable within 60 days of March 31, 2000 are deemed
to be beneficially owned by the person holding such options for the
purpose of computing the beneficial ownership of such person, but are
not treated as outstanding for the purpose of computing the beneficial
ownership of any other person.
(3) Applicable percentage of ownership is based on 22,480,071 voting shares
of common stock outstanding on March 31, 2000.
(4) The address for Royal Holding Company, Inc. is 300 Delaware Avenue,
Suite 306, Wilmington, Delaware 19801.
(5) The shares of common stock beneficially owned by Mr. Conner are held
directly by the Conner Family Trust DTD 2/23/91 (the "Trust") of which
Mr. Conner is co-trustee and co-beneficiary. Mr. Conner's and the
Trust's address is P.O. Box S-3115, Carmel, California 93921. Mr.
Conner served as a director until February 4, 1999.
(6) The address for Mr. Casati is Continental Offices Ltd., 2700 River
Road, Suite 211, Des Plaines, IL 60018. Mr. Casati served as a director
until December 30, 1999.
(7) Includes 6,374,511 shares of common stock owned directly by Royal
Holding Company, Inc. Messrs. Patchin and Brown are the (1) Chief
Executive Officer and President and (2) Chief Financial Officer and
Vice President-Finance, respectively, of Royal Holding Company, Inc.
and by virtue of these positions may be deemed to share the power to
vote or direct the vote of, and to share the power to dispose or direct
the disposition of, these shares of common stock. Each of Messrs.
Patchin and Brown disclaim beneficial ownership of the shares of common
stock held by Royal.
(8) Includes 49,000 shares of common stock owned directly by trusts of
which Mr. Simpson serves as a co-trustee.
6
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under U.S. securities laws, directors, certain executive officers
and persons holding more than 10% of Adams Golf's common stock must report
their initial ownership of the common stock, and any changes in that
ownership, to the Securities and Exchange Commission. The Securities and
Exchange Commission has designated specific due dates for these reports.
Based solely on our review of copies of the reports filed with the Securities
and Exchange Commission and written representations of our directors and
executive officers, we believe all persons subject to reporting filed the
required reports on time in 1999.
MANAGEMENT
EXECUTIVE OFFICERS
Below are the names and ages of the Executive Officers of Adams Golf
and a brief description of their prior experience and qualifications.
- B.H. (Barney) Adams -- PLEASE SEE BIOGRAPHY OF MR. ADAMS ON
PAGE 4.
- Richard H. Murtland -- PLEASE SEE BIOGRAPHY OF MR. MURTLAND ON
PAGE 3.
- Darl P. Hatfield -- Age 53, Senior Vice President - Finance
and Administration and Chief Financial Officer since May 1998.
From June 1968 to April 1998, Mr. Hatfield was employed by
KPMG. Mr. Hatfield was a partner with KPMG from July 1977 to
April 1998.
- Oliver G. Brewer III -- Age 36, Senior Vice President - Sales
and Marketing since September 1998. Vice President of Sales
and Marketing, Mead Containerboard, a division of the Mead
Corporation from July 1997 through August 1998; Regional Vice
President-Asia Pacific, Union Camp Business Development
Corporation from December 1994 through July 1997.
COMPENSATION OF EXECUTIVE OFFICERS
The following table shows for the fiscal years ended December 31,
1997, 1998 and 1999, compensation awarded or paid to, or earned by, our Chief
Executive Officer and our other executive officers whose salary plus bonus
exceeded $100,000 for any of the fiscal years indicated.
7
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPEN-
SATION
ANNUAL COMPENSATION AWARDS
------------------------------------------------ ------------
SECURITIES
UNDERLYING
OTHER ANNUAL OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITIONS YEAR SALARY BONUS COMPENSATION (#) COMPENSATION (1)
- -------------------------------- -------- ------------- --------------- ----------------- ------------ -----------------
<S> <C> <C> <C> <C> <C> <C>
B.H. ADAMS................... 1999 $ 240,000 $ 0 -- 0 $ 4,766
Chairman of the Board, 1998 240,000 120,000 -- 0 1,313
President 1997 162,940 10,015,000(2) $2,541,688 (3) 0 4,185
and Chief Executive Officer
RICHARD H. MURTLAND.......... 1999 150,000 11,250 -- 30,000 2,979
Vice President-Research 1998 125,000 62,500 -- 0 795
and Development, Secretary 1997 72,548 40,000 -- 0 0
and Treasurer
DARL P. HATFIELD............. 1999 180,000 13,500 -- 30,000 3,740
Senior Vice President- 1998 100,000(4) 45,000 -- 90,000 636
Finance and Administration,
and Chief Financial Officer
OLIVER G. BREWER III ....... 1999 150,000 11,250 -- 30,000 455
Senior Vice President- 1998 39,343(5) -- -- 80,000 26,898(6)
Sales and Marketing
</TABLE>
- -----------
(1) In each case, except as noted, represents group life insurance premiums
paid on behalf of such officer.
(2) Represents (a) $15,000 cash bonus and (b) value of 2,000,000 shares of
common stock granted effective on December 31, 1997 having a fair
market value, as determined by the Board of Directors, of $5.00 per
share on the date of grant.
(3) Represents reimbursement of federal income tax and Medicare tax
liabilities associated with the shares of restricted stock granted to
Mr. Adams during that year.
(4) Mr. Hatfield became employed by Adams Golf in May 1998.
(5) Mr. Brewer became employed by Adams Golf in September 1998.
(6) Includes $26,443 in relocation reimbursement paid to Mr. Brewer and
$455 in group life insurance premiums paid on Mr. Brewer's behalf.
OPTION GRANTS IN 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------------------------------------
% OF TOTAL
NUMBER OF OPTIONS
SECURITIES GRANTED TO EXERCISE
UNDERLYING EMPLOYEES PRICE EXPIRATION GRANT DATE
NAME OPTIONS GRANTED (1) IN FISCAL YEAR PER SHARE DATE PRESENT VALUE (2)
- ------------------------- -------------------- --------------- ----------- ------------ -------------------
<S> <C> <C> <C> <C> <C>
B.H. ADAMS 0 0 0 - 0
RICHARD H. MURTLAND 30,000 6.2% $ 4.00 3/02/04 $31,500
DARL P. HATFIELD 30,000 6.2 4.00 3/02/04 31,500
OLIVER G. BREWER III 30,000 6.2 4.00 3/02/04 31,500
</TABLE>
- -----------
(1) The Board of Directors granted all options noted on March 2, 1999. The
options are non-transferrable. The options vest in four equal
installments beginning on the first anniversary of the grant date and
continuing on successive anniversaries thereafter.
(2) We calculated this amount using the Black-Scholes option pricing model,
a complex mathematical formula that uses six different market-related
factors to estimate the value of stock options. The factors are stock
price at date of grant, option exercise price, option term, risk-free
rate of return, stock volatility and dividend yield. The Black-Scholes
8
<PAGE>
model generates an estimate of the value of the right to purchase a
share of stock at a fixed price over a fixed period. Using this
valuation methodology, the options granted in 1999 have a value of
$1.05 per option share. The actual value, if any, an executive realizes
will depend on whether the stock price at exercise is greater than the
grant price, as well as the executive's continued employment through
the vesting period and the 5-year option term. The following
assumptions were used to calculate the Black-Scholes value:
<TABLE>
<C> <C>
Stock price at date of grant.......$4.00 Option term.....................Five years
Option exercise price..............$4.00 Risk-free rate of return................6%
Dividend yield.....................0% Volatility............................8.3%
</TABLE>
SECURITIES UNDERLYING UNEXERCISED OPTIONS AT FISCAL YEAR END (1)
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED
OPTIONS AT FISCAL YEAR END(#)
---------------------------------
NAME EXERCISABLE UNEXERCISABLE
- -------------------------------------- ---------------- ----------------
<S> <C> <C>
B.H. ADAMS 0 0
RICHARD H. MURTLAND 0 30,000
DARL P. HATFIELD 60,000 60,000
OLIVER G. BREWER III 20,000 90,000
</TABLE>
- -----------
(1) In each case, the options referenced maintained an exercise price in
excess of the fair market value of the common stock underlying the
options at December 31, 1999.
EMPLOYMENT CONTRACTS AND CHANGE IN CONTROL ARRANGEMENTS
At the time of his employment, Adams Golf and Mr. Darl P. Hatfield
(our Senior Vice President-Finance and Administration and Chief Financial
Officer) executed a letter agreement defining certain matters related to Mr.
Hatfield's employment. The agreement provides that Mr. Hatfield is entitled
to a minimum base salary of $150,000 annually and may receive bonuses of up
to 80% of this salary based on achieving certain revenue and/or department
goals to be defined by us. In addition, the agreement provides that, upon Mr.
Hatfield's termination without cause following certain change of control
events, Mr. Hatfield's stock options will become fully vested and Mr.
Hatfield will be paid an amount equal to one year of his base salary. The
agreement with Mr. Hatfield is of an unspecified term.
We have not entered into an employment contract with any of our
other executive officers.
Our Board of Directors can, among other things, provide for
accelerated vesting of the shares of common stock subject to outstanding
options held by an executive officer or director, including the persons
designated as named executive officers in connection with certain changes of
control of Adams Golf.
9
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1999, the Compensation Committee consisted of Messrs. Casati,
Mulvoy and Patchin. Mr. Casati retired from the Board of Directors in
December 1999.
CERTAIN TRANSACTIONS
We entered into an agreement with professional golfer, Nick Faldo on
May 1, 1998 that provides that Mr. Faldo will exclusively endorse our golf
clubs and undertake certain other promotional and research and development
activities. Under the agreement, we have licensed the worldwide rights to the
Nick Faldo trademark for use in connection with the distribution of our golf
clubs, head covers, golf bags, travel covers, golf towels and umbrellas that
we design or manufacture.
In addition to the 900,000 shares of common stock previously granted
to Mr. Faldo, our agreement provides that we are to pay royalties to Mr.
Faldo throughout the term of such agreement. For the year ended December 31,
1999, we paid Mr. Faldo the minimum royalty under the agreement of $1.5
million. We have also agreed that through the year 2008, we will support the
"Faldo Junior Series" in the United Kingdom by making an annual contribution
to the sponsoring organization of not less than $45,000 for each year the
tournament is played under that name.
The agreement with Mr. Faldo further provides that, so long as
royalties remain payable thereunder, we will cause a designee of Mr. Faldo to
be nominated for, and elected to, the Board of Directors. Mr. Faldo has
currently designated John S. Simpson under this arrangement.
The agreement with Mr. Faldo extends through Mr. Faldo's lifetime;
however, we maintain the right to terminate the agreement earlier if Mr.
Faldo (a) is unable to perform the duties required for a period of 12
consecutive months, (b) retires or becomes officially ineligible to compete
on the PGA and/or Senior PGA tour, or (c) has engaged in illegal or immoral
conduct resulting in a felony conviction, or has otherwise conducted himself
in a manner not in keeping with the standards of professional conduct set
forth in the agreement. In the event of the death of Mr. Faldo prior to May
1, 2030, we may, at our option, continue the terms of the agreement until May
1, 2030, in which case, Mr. Faldo's heirs or estate shall be entitled to any
royalties due.
On April 30, 1999, we purchased substantially all of the assets and
assumed certain liabilities of Dimensions in Sport, Ltd., a distributor of
golf equipment in the United Kingdom ("DIS"). Specifically, we paid the net
book value of equipment and inventory (approximately $400,000) and assumed
going forward obligations under certain leases. DIS was controlled by Mr.
Faldo.
10
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
COMPENSATION POLICY
The Compensation Committee of the Board of Directors establishes and
administers our executive compensation programs. The full Board of Directors
of Adams Golf reviews the Committee's recommendations and approves the
salaries of all elected officers, including the named executive officers who
appear in the Summary Compensation Table on page 8. The Committee reviews
salary recommendations for executive officers and is responsible for all
other elements of executive compensation, including annual and long-term
incentive awards.
Our goal is to attract, retain and reward a highly competent and
productive employee group. To do so, both the Compensation Committee and the
Board of Directors, as a whole, have determined that it is in the best
interest of the Company to provide a total compensation package that competes
favorably with those offered within the sports equipment industry, general
industry and geographic areas in which Adams Golf operates. In the latter
half of 1998, we commissioned an independent human resources consultant to
conduct a compensation analysis. Based on this analysis, we compare Adams
Golf to a self-selected group of companies which have been chosen based on
similar sales volume and business characteristics. There are currently 1,400
companies in this comparison group, which is subject to occasional change.
Because we believe that we compete with a much larger group of companies for
qualified executives, the group of comparable companies for compensation
purposes is intentionally broader than the "Peer Group" noted in our
Performance Graph on page 14.
Our current compensation package consists of three basic components:
base salary, bonus awards under the 1999 Management Incentive Plan, and stock
option grants under our Stock Incentive Plan. The base salaries and the stock
option grants for 1999 were targeted at the 50th percentile while the
Management Incentive Plan was targeted at the 75th percentile of the
companies surveyed. Executive officer salary adjustments are determined by a
subjective evaluation of the individual's performance, our financial and
operational performance, and the results of our assessment of comparable
companies. Although we do not utilize any formal mathematical formulae or
objective thresholds (except in the case of awards under our Management
Incentive Plan) particular attention is given to the operating results of
Adams Golf. We believe that specific formulae restrict flexibility and are
too rigid at this stage of our development.
BASE SALARY. The base salary policy provides for compensation at
competitive levels. Increases in executive base salary are awarded for
individual and overall company performance and generally reflect established
merit increase guidelines applicable to all salaried employees.
1999 MANAGEMENT INCENTIVE PLAN. The 1999 Management Incentive Plan
provides the potential for quarterly and year-end incentives. The plan was
designed to create an incentive for key employees, including the Chief
Executive Officer, other named officers, and management employees who are in
a position to contribute to, and therefore influence, Adams Golf's annual
financial performance. The plan does not permit awards unless the Company's
revenue and earnings exceed 90% of the Company's target objectives as
established by the Board of
11
<PAGE>
Directors. In 1999, 50% of the second quarter target bonus was paid based
upon the 90% achievement of the targeted financial goals for that quarter. No
other bonus awards were paid during the year.
STOCK INCENTIVE PLAN. The purpose of our stock incentive plan is to
further align employees' interests with our long-term performance and
therefore, the long-term interests of the stockholders. Options were granted
to employees who were in the position to influence business results. Because
the exercise prices provided in the options represent the fair market value
of the common stock when granted, the options have no value unless the common
stock appreciates in the future. The options typically vest in 25% increments
on the first, second, third and fourth anniversaries of the date of grant.
1999 COMPANY PERFORMANCE
In 1999 Adams Golf's diluted loss per common share was $0.47,
compared to 1998 diluted income per common share of $.61. Net revenues
decreased to $54.0 million in 1999 compared to $84.6 million in 1998. The net
loss for 1999 was $10.6 million as compared to net income in 1998 of $12.5
million.
During 1999, the Company introduced a number of new products and
made progress in certain strategic areas, including the reconfiguration of
Adams Golf's sales department, the realignment and expansion of the
Company's advertising and marketing department, and the establishment of a
subsidiary in the United Kingdom. However, the Company's financial
performance in 1999 was below expected levels in the opinion of the
Committee.
1999 EXECUTIVE COMPENSATION
Base salary adjustments and stock option grant awards were given to
Richard H. Murtland, Vice President-Research and Development, Secretary and
Treasurer, Darl P. Hatfield, Senior Vice President-Finance and Administration
and Chief Financial Officer, and Oliver G. Brewer III, Senior Vice
President-Sales and Marketing. These adjustments were made in the first
quarter of 1999 based on company and individual performance for the year
ended December 31, 1998. However, these executive officers did not receive
salary increases or stock option grant awards for 1999 performance, which
would have been implemented during the first quarter of 2000. Bonus awards
were issued under the 1999 Management Incentive Plan in the amounts of
$11,250 for Mr. Murtland, $13,500 for Mr. Hatfield and $11,250 for Mr.
Brewer, and were determined by individual and company performance.
Specifically, these awards were made at 50% of the second quarter target
bonus based on the 90% achievement of the targeted company financial goals
for that quarter as approved by the Board of Directors.
1999 CHIEF EXECUTIVE COMPENSATION
The compensation of Chairman, Chief Executive Officer and President,
B.H. Adams consists of the same basic components as for other executive
officers. In determining the base salary, we considered Chief Executive
Officer pay of the survey group previously described and the Company's
financial and operating performance. Mr. Adams received a base salary of
$240,000 in 1999, which was not increased from 1998 despite the Company's
favorable 1998
12
<PAGE>
financial performance. Furthermore, as a result of the Company's
disappointing financial performance in 1999, Mr. Adams did not receive a base
salary increase, which would have been effective January 1, 2000. With
respect to bonuses and stock options, the Committee agreed with Mr. Adams'
recommendation that he not be awarded any bonuses or stock option grants
related to the Company's 1999 performance. However, we note that Mr. Adams
continues to lead the Company's research and development efforts which,
during 1999, resulted in the market introduction of the SC Series-TM- drivers
and the Faldo Series Wedges-TM-, as well as the Tight Lies-R- Tour and Tight
Lies-R-(2) fairway woods.
COMPANY POLICY ON QUALIFYING COMPENSATION
We have reviewed the applicability of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), which disallows a tax
deduction for compensation to an executive officer in excess of $1.0 million
per year. We do not anticipate that compensation subject to this threshold
will be paid to any executive officer in the foreseeable future.
We intend to periodically review the potential consequences of
Section 162(m) and may in the future structure the performance-based portion
of our executive officer compensation to comply with certain exemptions
provided in Section 162(m).
The foregoing report on executive compensation is provided by the
following non-employee directors, who constituted the Compensation Committee
during 1999:
ROLAND E. CASATI* MARK R. MULVOY STEPHEN R. PATCHIN
- -----------
* Mr. Casati retired from the Board of Directors in December 1999.
13
<PAGE>
PERFORMANCE GRAPH
The following performance graph compares the performance of the Adams
Golf common stock to the Standard & Poor's Small Cap 600 index and an industry
peer group, selected in good faith, for the period from July 10, 1998, the first
day of trading for the Company's shares, through December 31, 1999. The graph
assumes that the value of the investment in the Company's common stock and each
index was $100.00 at July 10, 1998, and that all dividends were reinvested. The
Company has paid no dividends. Performance data is provided for the last trading
day closest to year end for each 1998 and 1999.
[CHART]
<TABLE>
<CAPTION>
JULY 10, DECEMBER DECEMBER
COMPANY 1998 1998 1999
- -------------------------------------- ------------- -------------- --------
<S> <C> <C> <C>
Adams Golf, Inc. 100 26 10
Peer Group (1) 100 51 86
S&P Small Cap 600 100 93 105
</TABLE>
- ----------------
(1) Peer Group consists of: Callaway Golf Company, TearDrop Golf Company,
Aldila, Inc. and Coastcast Corp.
14
<PAGE>
ITEM 2.
APPROVAL OF PROPOSAL TO INCREASE THE NUMBER
OF SHARES AVAILABLE FOR ISSUANCE
UNDER ADAMS GOLF'S 1998 STOCK
INCENTIVE PLAN.
PURPOSE; ELIGIBILITY; AWARDS. In February 1998, we adopted the 1998
Stock Incentive Plan. The stated purpose of this Plan is to provide
incentives and awards for participating employees and consultants:
- to support the execution of our business strategies and the
achievement of our goals; and
- to associate the interests of such persons with those of our
stockholders.
As of March 31, 2000, approximately 250 persons were eligible to participate
in the Plan; however, we have historically not awarded stock options to all
of our employees. The Compen-sation Committee is responsible for
administering the Plan. In determining the eligibility of any person, as well
as in determining the number of shares to be covered by an award and the type
of award to be made, the Committee may consider the position, relationship,
responsibilities and importance of the person to the Company and such other
factors as the Committee deems relevant. In furtherance of this purpose, the
Plan authorizes the granting of the following types of awards:
- - incentive stock options;
- - restricted and performance shares;
- - dividend or equivalent rights;
- - nonqualified stock options;
- - restricted and performance share units;
- - other awards that are valued by
reference to, or are otherwise
based on, our common stock.
- - stock appreciation rights;
- - performance stock awards;
AMENDMENT TO THE PLAN. As of March 31, 2000, we had granted options
to purchase 894,530 shares and had made a stock grant of 900,000 shares of
the 1,800,000 shares of common stock authorized under the Plan. Thus, at
March 31, 2000, 5,470 shares were available for grant under the Plan.
Consequently, on February 15, 2000, our Board of Directors determined that it
would be in our best interest, and in the best interest of our stockholders
and the participants in the Plan to, pending stockholder approval, increase
the number of shares issuable upon exercise of options granted under the Plan
by 900,000 shares of common stock. Approval of this amendment is required by
the rules of the Nasdaq Stock Market. By amending the Plan to provide for the
granting of options to purchase additional shares, we will continue the
purposes of the Plan stated in the introductory paragraph of this item.
Without such amendment, our ability to utilize stock options as a form of
incentive compensation would be substantially limited.
NEW PLAN BENEFITS. Because the amendment proposed to be made to the
Plan does not, in and of itself, affect the number or dollar value of the
benefits to be received by participants thereunder, it is not possible to
determine the dollar value or the number of shares that will be received
under the Plan as so amended. However, for illustrative purposes only, the
following chart provides information concerning options granted to certain
persons and groups over the course of 1999.
15
<PAGE>
1998 STOCK INCENTIVE PLAN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES UNDERLYING
OPTIONS GRANTED
GROUP EXERCISE PRICE(S) DURING 1999
- ------------------------------------------------------------ -------------------------- -----------------------------
<S> <C> <C>
B.H. Adams............................................. - -
Richard H. Murtland.................................... $4.00 30,000
Darl P. Hatfield....................................... $4.00 30,000
Oliver G. Brewer III................................... $4.00 30,000
Executive Group........................................ $4.00 90,000
Non-Executive Officer Employee Group................... $2.31 to $4.00 484,250
</TABLE>
MATERIAL PROVISIONS. As indicated, the Plan is administered by the
Compensation Committee which, during 1999, was comprised of Messrs. Casati,
Mulvoy and Patchin. The Compensation Committee has discretion to select the
persons to whom awards will be granted, to determine the type, size and terms
and conditions applicable to each award and the authority to interpret,
construe and implement the provisions of the Plan. Each award under the Plan
is evidenced by an Award Agreement executed with the participant.
Under the Plan, we may grant, in addition to other awards, incentive
or nonqualified stock options. The exercise price of an option granted under
the Plan must be at least equal to the fair market value of the common stock
on the date of the grant, and in the case of a grant of an incentive stock
option to any participant who owns stock representing more than 10% of the
common stock, the exercise price shall at least equal 110% of the fair market
value of the shares at the time the incentive stock option is granted. In
addition, no incentive stock option is exercisable more than 10 years from
the date of grant (5 years if such option is granted to a participant who
owns in excess of 10% of the common stock) and the aggregate fair market
value, determined on the date of grant, of the common stock as to which such
incentive stock options are exercisable for the first time by any participant
in the Plan shall be limited to $100,000 per calendar year. As of March 31,
2000, we had granted only stock options or restricted stock under the Plan.
If a participant terminates his or her service for reasons other
than retirement, permanent and total disability or death, the participant may
exercise, no later than the date of termination, only those stock options
vested as of the date of termination. Upon retirement, a participant's
options immediately vest and such participant may exercise nonqualified stock
options within one year of retirement and incentive stock options within
three months of such retirement. In order to retire under the Plan, a
participant must have attained the age of 62 and have had 10 years of
continuous employment with us. In the case of termination as a result of
permanent and total disability, a participant's options will immediately vest
and such participant will have one year from termination to exercise any
outstanding options. If a participant who was granted stock options dies
while employed by us, or during the period which options may be exercised
following termination of employment due to retirement or permanent and total
disability, all stock options granted under the Plan immediately vest and
must be exercised by the participant's estate no later than the termination
date of such option. Except to the extent permitted by the Internal Revenue
Code and the rules and regulations promulgated under Section 16 of the
Securities Exchange Act of 1934 (i) no award under the Plan is assignable or
transferable except by will, by the laws of descent and distribution or
pursuant to a qualified domestic relations order
16
<PAGE>
and (ii) during the lifetime of a participant, the award will be exercisable
only by such participant or such participant's guardian, legal representative
or assignee pursuant to a qualified domestic relations order.
The Plan provides that, in the event of a "change of control" (as
defined below), the following may, in the sole discretion of the Compensation
Committee, occur with respect to any awards outstanding as of the date of
such event:
- automatic maximization of performance standards, lapse of all
restrictions and acceleration of any time periods relating to
the exercise, realization or vesting of such awards so that
such awards may be immediately exercised, realized or vested
in full on or before the relevant date fixed in the applicable
Award Agreement;
- performance shares or performance units shall be paid entirely
in cash;
- upon the exercise of a stock option during the 60-day period
from and after the date of the change of control, the
participant exercising the option may in lieu of the receipt
of common stock upon exercise, elect by written notice to the
Company to receive an amount in cash equal to the excess of
the aggregate Value (as defined below) of the shares of common
stock covered by the option or portion thereof surrendered,
determined on the date the option is exercised, over the
aggregate exercise price of the option (the "Aggregate
Spread"). "Value," as more fully defined in the Plan, means
the higher of (i) the highest fair market value during the
60-day period after the date of a change of control and (ii)
if the change of control is the result of a transaction
described in the first or third paragraphs under the
definition of a change of control, the highest price per share
of the common stock paid in such transaction.
- if a participant's employment or engagement terminates for any
reason other than retirement or death following a change of
control, any options held by such participant may be exercised
by such participant until the earlier of three months after
the termination of employment or engagement or the expiration
date of such options; and
- all awards become non-cancellable.
For purposes of the Plan, "change of control" is defined, in general, to mean
the occurrence of any of the following events: (i) the acquisition, other
than from us, by an individual, entity or group (other than Royal Holding or
B. H. Adams) of beneficial ownership of thirty percent (30%) or more of the
then outstanding shares of common stock; (ii) the ceasing, for any reason, of
individuals who, as of January 1, 1998, constitute the Board of Directors to
constitute at least a majority of the Board; (iii) approval by the
stockholders of the Company of certain reorganizations, mergers or
consolidations of the Company; (iv) the complete liquidation of the Company;
or (v) the dissolution of the Company or the sale or other disposition of all
or substantially all of the assets of the Company.
TERMINATION. The Plan terminates on February 25, 2008.
17
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES - ISO. The federal income tax
consequences, in general, of the grant and exercise of an incentive stock
option under our Plan are as follows:
- In general, an employee will not recognize taxable income upon
the grant or exercise of an incentive stock option and we will
not be entitled to any business expense deduction with respect
to the grant or exercise of an incentive stock option.
- After the date of exercise, if the employee holds the shares
for at least one year, and until at least two years after the
date of grant, the difference, if any, between the sales price
of the shares and the exercise price of the option will be
treated as long-term capital gain or loss upon subsequent
disposition of the shares.
- If the employee disposes of the shares prior to satisfying the
holding period requirements, the employee will recognize
ordinary income at the time of the disposition, generally in
an amount equal to the excess of the fair market value of the
shares at the time the option was exercised over the exercise
price of the option. Generally, we will be allowed a business
expense deduction to the extent an employee recognizes
ordinary income. The balance of the gain realized, if any,
will be short-term or long-term capital gain, depending upon
whether the shares have been held for at least one year after
the date of exercise.
FEDERAL INCOME TAX CONSEQUENCES - NQSO. The federal income tax
consequences, in general, of the grant and exercise of a nonqualified stock
option under our Plan are as follows:
- In general, a recipient who receives a nonqualified stock
option will recognize no income at the time of the grant of
the option.
- Upon exercise of a nonqualified stock option, a recipient will
recognize ordinary income in an amount equal to the excess of
the fair market value of the shares on the date of exercise
over the exercise price of the option. Generally, we will be
entitled to a business expense deduction in the amount and at
the time the recipient recognizes ordinary income.
- The basis in shares acquired upon exercise of a nonqualified
stock option will equal the fair market value of such shares
at the time of exercise, and the holding period of the shares,
for capital gain purposes, will begin on the date of exercise.
We recommend a vote FOR the proposal to increase the number of
shares issuable under the 1998 Stock Incentive Plan.
18
<PAGE>
ITEM 3.
RATIFICATION OF KPMG AS INDEPENDENT AUDITORS
Our Board of Directors, upon recommendation of the Audit Committee,
has appointed KPMG as independent auditors to examine our consolidated
financial statements for the fiscal year ending December 31, 2000 and to
render other professional services as required.
We are submitting the appointment of KPMG to stockholders to obtain
your ratification. KPMG has served as our independent auditors since 1997.
Representatives of KPMG will be present at the meeting, will have the
opportunity to make a statement if they desire to do so, and are expected to
be available to respond to questions.
We recommend a vote FOR the ratification of KPMG as our independent
auditors for the current fiscal year.
19
<PAGE>
ANNUAL MEETING ADVANCE NOTICE REQUIREMENTS
Our Bylaws provide that stockholder proposals and director
nominations by stockholders may be made in compliance with certain advance
notice, informational and other applicable requirements. With respect to
stockholder proposals (concerning matters other than the nomination of
directors), the individual submitting the proposal must file a written notice
with the secretary of Adams Golf at 2801 E. Plano Parkway, Plano, Texas 75074
setting forth certain information about the stockholder and all persons
acting in concert with him or her, including the following information:
- a brief description of the business desired to be brought
before the meeting and the reasons for conducting such
business at the annual meeting;
- the names and addresses of the supporting stockholders;
- the class and number of shares of our stock that are
beneficially owned by such persons; and
- any material interest of such persons in the matter presented.
The notice must be delivered to the secretary (1) at least 90 days before any
scheduled meeting or (2) if less than 100 days notice or prior public
disclosure of the meeting is given, by the close of business on the 10th day
following the giving of notice or the date public disclosure was made,
whichever is earlier.
A stockholder may recommend a nominee to become a director of Adams
Golf by giving the secretary (at the address set forth above) a written
notice setting forth certain information, including:
- the name, age, business and residence address of the person
intended to be nominated;
- a representation that the nominating stockholder is in fact a
holder of record of Adams Golf common stock entitled to vote
at the meeting and that he or she intends to be present at the
meeting to nominate the person specified;
- a description of all arrangements between the nominating
stockholder, the nominee and other persons concerning the
nomination;
- any other information about the nominee that must be disclosed
in proxy solicitations under Rule 14(a) of the Securities
Exchange Act of 1934; and
- the nominee's written consent to serve, if elected.
Such nominations must be made pursuant to the same advance notice
requirements for stockholder proposals set forth in the preceding paragraph.
Adams Golf's annual meetings are traditionally held on the first Wednesday of
May of each year. Accordingly, our 2001 annual meeting of stockholders is
currently scheduled for May 2, 2001. Copies of our Bylaws are available upon
written request made to the secretary of Adams Golf at the above address. The
requirements described above do not supersede the requirements or conditions
established by the Securities and Exchange Commission for stockholder
proposals to be included in Adams Golf's proxy materials for a meeting of
stockholders. The Chairman of the meeting may refuse to bring before a
meeting any business not brought in compliance with applicable law and our
Bylaws.
20
<PAGE>
[LOGO]
[MAP]
Directions to Adams Golf's Annual Meeting of Stockholders
FROM DFW AIRPORT - Proceed to North exit from terminal. After the tollbooth,
stay left to enter Hwy 121 North. Stay right on Hwy 121 for a short distance
to Hwy 635 East exit. Follow Hwy 635 eastward to Hwy I-75 North. Keep far
left on Hwy 635 for the I-75 exit ramp. Follow I-75 North approximately 10
miles to the Spring Creek Parkway exit. Turn right on Spring Creek Parkway.
FROM LOVE FIELD - Exit Love Field and turn left on Mockingbird Lane. Proceed
to North Dallas Tollway, go left (North) to the Hwy 635 exit. Follow Hwy 635
eastward to Hwy I-75 North. Keep far left on Hwy 635 for the I-75 exit ramp.
Follow I-75 North approximately 10 miles to the Spring Creek Parkway exit.
Turn right on Spring Creek Parkway.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY.
<PAGE>
ADAMS GOLF, INC.
PROXY/VOTING INSTRUCTION CARD
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ADAMS GOLF, INC.
FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 3, 2000
The undersigned appoint B.H. Adam , Richard H. Murtland and Darl P.
Hatfield, and each of them, with full power of substitution in each, the
proxies of the undersigned, to repre ent the underigned and vote all hare of
Adams Golf, Inc. Common Stock which the under igned may be entitled to vote
at the Annual Meeting o Stockholder to be held on May 3, 2000, and at any
adjournment or po tponement thereto , a indicated on the reverse side.
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder. I no direction is given, this proxy
will be voted FOR proposals 1, 2 and 3.
Comments / Change of Address : ____________
- --------------------------------------
- --------------------------------------
- --------------------------------------
If you have written in the above space, ADAMS GOLF, INC.
please mark the comment notification box P.O. BOX 11207
on the reverse side. NEW YORK, N.Y. 10203-0207
(Continued, and to be signed and dated on the reverse side.)
<PAGE>
PLEASE DETACH HERE
YOU MUST DETACH THIS PORTION OF THE PROXY CARD
BEFORE RETURNING IT IN THE ENCLOSED ENVELOPE
DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote "FOR" Items 1, 2 and 3.
1. Election of FOR all nominees / / WITHHOLD AUTHORITY / / *EXCEPTIONS / /
Directors listed below to vote for
all nominees
listed below
Nominees: Richard H. Murtland and John S. Simpson
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK
THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.)
Exceptions ____________________________________________________________________
2. Directors' Proposal - Approve 3. Directors' Proposal - Ratify
the increase in the number of the appointment of KPMG LLP as
shares available for issuance our independent auditors for
under our 1998 Stock Incentive 2000.
Plan.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
/ / / / / / / / / / / /
In their discretion, the proxies I have included comments, I plan to attend
are authorized to vote upon such or have included a change the Annual
other matters as may properly of address. / / Meeting. / /
come before the meeting or any
adjournment thereof.
I do not wish to receive an Annual Report
for this account, at this address. / /
Please sign exactly as name or names appear
on this proxy. When signing as attorney,
executor, administrator, trustee, custodian,
guardian or corporate officer, give full
title. If more than one trustee, all should
sign.
Dated:________________________________, 2000
____________________________________________
Signature of Stockholder
____________________________________________
MARK, SIGN, DATE AND RETURN THE Votes must be indicated
PROXY CARD PROMPTLY USING THE (x) in Black or Blue ink. /X/
ENCLOSED ENVELOPE.
