UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Soliciting Material Pursuant to
[_] Confidential, For Use of the SS.240.14a-11(c) or SS.240.14a-12
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
INSILCO HOLDING CO.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(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 transaction:
- - --------------------------------------------------------------------------------
5) Total fee paid:
- - --------------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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SEC 1913 (3-99)
<PAGE>
INSILCO HOLDING CO.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD
MAY 18, 2000
AND
PROXY STATEMENT
================================================================================
IMPORTANT
PLEASE MARK, SIGN AND DATE YOUR PROXY
AND PROMPTLY RETURN IT IN THE ENCLOSED ENVELOPE
<PAGE>
INSILCO HOLDING CO.
425 METRO PLACE NORTH
DUBLIN, OHIO 43017
(614) 792-0468
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 18, 2000
April 18, 2000
To the Stockholders of Insilco Holding Co.:
NOTICE is hereby given that the Annual Meeting of Stockholders of
Insilco Holding Co., a Delaware corporation (the "Company") will be held at the
Corporate Headquarters of Insilco Holding Co. at 425 Metro Place North, Dublin,
Ohio, 43017 on May 18, 2000, at 10:00 a.m., local time, for the following
purposes:
1. To elect six directors, each for a one-year term expiring at the
Annual Meeting of Stockholders in 2001.
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Owners of Common Stock of the Company of record at the close of
business on April 12, 2000, will be entitled to vote at the meeting.
Whether or not you plan to attend the meeting, please date, sign and
mail the enclosed proxy in the envelope provided.
A copy of the Annual Report on Form 10-K of the Company for the fiscal
year ended December 31, 1999, is enclosed. Thank you for your cooperation.
By Order of the Board of Directors
David A. Kauer
President and Chief Executive Officer
<PAGE>
INSILCO HOLDING CO.
425 METRO PLACE NORTH
DUBLIN, OHIO 43017
(614) 792-0468
April 18, 2000
PROXY STATEMENT FOR
2000 ANNUAL MEETING OF STOCKHOLDERS
INTRODUCTION
This Proxy Statement is furnished to the stockholders of Insilco Holding
Co., a Delaware corporation (the "Company"), in connection with the solicitation
by the Board of Directors of the Company of proxies to be used at the Annual
Meeting of Stockholders (the "Annual Meeting") to be held at the Corporate
Headquarters of Insilco Holding Co. at 425 Metro Place North Dublin, Ohio,
43017, on May 18, 2000, at 10:00 a.m., local time, and at any adjournment or
postponement thereof. The Proxy Statement and the enclosed proxy are being
mailed to the stockholders on or about the date set forth above.
All shares represented by properly executed proxies received by the Board
of Directors pursuant to this solicitation will be voted in accordance with the
stockholder's directions specified on the proxy or, in the absence of specific
instructions to the contrary, will be voted in accordance with the Board of
Director's unanimous recommendations, which are FOR the election of Randall E.
Curran, William F. Dawson, Jr., Thompson Dean, John F. Fort III, David Y. Howe,
and David A. Kauer as directors of the Company; and, at the discretion of the
persons acting under the proxy, to transact such other business as may properly
come before the meeting or any adjournment thereof.
A proxy may be revoked, without affecting any vote previously taken, by
written notice mailed to the Company (attention Chief Executive Officer or
Corporate Secretary) or delivered in person at the meeting, by filing a duly
executed, later dated proxy, or by attending the meeting and voting in person.
A majority of the outstanding shares of the Company will constitute a
quorum at the meeting. Abstentions and broker non-votes are counted for purposes
of determining the presence or absence of a quorum for the transaction of
business. The election of each director nominee requires the favorable vote of a
plurality of all votes cast by the holders of Common Stock at a meeting at which
a quorum is present. Only shares that are voted for a particular nominee will be
counted towards such nominee's achievement of a plurality. Abstentions and
broker non-votes are not counted toward such nominee's achievement of a
plurality and, thus, will have no effect. Each other matter to be submitted to
the stockholders at this meeting requires the affirmative vote of the majority
of shares present in person or represented by proxy at the meeting and entitled
to vote. Therefore, on all matters other than the election of directors,
abstentions and broker non-votes will have the same effect as votes cast against
the proposal.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
VOTING RIGHTS
Only stockholders of record at the close of business on April 12, 2000,
are entitled to notice of and to vote at the Annual Meeting and any adjournment
or postponement thereof. At April 12, 2000, the Company had 1,458,401
outstanding shares of Common Stock, $.001 par value (the "Common Stock"). Each
stockholder is entitled to one vote for each share held. There are no cumulative
voting rights in the election of directors. See also, "Information Concerning
Directors, Executive Officers and Principal Stockholders."
ELECTION OF DIRECTORS
Management has nominated Randall E. Curran, William F. Dawson, Jr.,
Thompson Dean, John F. Fort III, David Y. Howe, and David A. Kauer for election
as directors of the Company, each to serve for a term of one year and until his
successor is duly elected and qualified. The shares represented by the enclosed
proxy, if returned duly executed and unless instructions to the contrary are
indicated thereon, will be voted FOR the nominees. If for any reason a nominee
should not be a candidate for election at the time of the meeting (which
management does not expect), the proxies may be voted for a substitute nominee
in the discretion of those named as proxies. The election of each nominee
requires the favorable vote of a plurality of all votes cast by the holders of
Common Stock. Keith Palumbo, former director, resigned effective March 14, 2000.
As a result of Mr. Palumbo's resignation, there will be a vacancy on the Board
of Directors.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
ELECTION OF EACH NOMINEE FOR DIRECTOR.
The following table sets forth the name, age and business experience of
the nominees for election as directors of the Company. Each director has held
the occupation indicated for more than the past five years unless otherwise
indicated.
NAME AND BUSINESS EXPERIENCE AGE
---------------------------- ---
RANDALL E. CURRAN 44
Mr. Curran has been a Director, Chairman of the Board, President and
Chief Executive Officer of Thermadyne LLC since May 1998. Mr. Curran has
also served as a Director of Thermadyne Holdings Corporation, a publicly
traded company, since February 1994 and was elected Chairman of the Board
and Chief Executive Officer of Thermadyne Holdings Corporation in
February 1995, having previously served as President of Thermadyne
Holdings since August 1994 and as Executive Vice President and Chief
Operating Officer of Thermadyne Holdings Corporation since February 1994.
He also serves as President of Thermadyne Industries, Inc., a position he
has held since 1992. From 1986 to 1992, Mr. Curran was Chief Financial
Officer of Thermadyne Holdings Corporation and/or its predecessors. Prior
to 1986, Mr. Curran held various executive positions with Cooper
Industries, Inc. a publicly traded company.
WILLIAM F. DAWSON, JR. 35
Mr. Dawson has been a Managing Director of DLJMB Inc. since January 2000.
Prior to that and since August 1997, he was a Principal of DLJMB Inc.
From December 1995 to August 1997, he was a Senior Vice President in
DLJ's High Yield Capital Markets Group. Prior thereto, Mr. Dawson was a
Vice President in the Leveraged Finance Group within DLJ's Investment
Banking Group. Mr. Dawson serves as a director of Von Hoffman Press,
Inc., Haights Cross Communication, Inc, Merrill Corporation, WRC Media,
Inc. and Thermadyne Holdings Corporation, a publicly traded company.
THOMPSON DEAN 41
Mr. Dean has been the Managing Partner of DLJMB Inc. since November 1996.
Prior thereto, Mr. Dean was a Managing Director of DLJMB Inc. (and its
predecessor). Mr. Dean serves as a director of Commvault Inc., Von
Hoffman Press, Inc., Manufacturers' Services Limited, Phase Metrics,
Inc., a publicly traded company, and Arcade Holding Corporation.
JOHN F. FORT III 58
Mr. Fort retired as Chairman of the Board of the Directors of Tyco
International, Inc. a position he held from 1982 to December 1992. Mr.
Fort also served as Chief Executive Officer of Tyco International, Inc.
from 1982 to June 1992. Mr. Fort serves as a director of the following
publicly traded companies: Tyco International, Inc., Thermadyne Holdings
Corp., and Roper Industries.
DAVID Y. HOWE 35
Mr. Howe has been a Vice President of Citicorp Venture Capital, Ltd.
since 1993. Mr. Howe serves as a director of Trianon Industries, Inc.,
American Italian Pasta Company, IPC Communications, Inc., Formica Corp.,
Interface Solutions, Inc., C&H Sugar Company, Sterling Holding Co., Bob's
Stores, Inc. and PenTab Industries, Inc.
2
<PAGE>
DAVID A. KAUER 44
Mr. Kauer has been President and Chief Executive Officer of the Company
since June 1999. Prior to that, he served as Vice President and Chief
Financial Officer of the Company from May 1998 to June 1999, as Vice
President and Treasurer of the Company from April 1997 to May 1998, and
as Treasurer from September 1993 to April 1997. From October 1989 to
September 1993, he served as Controller and Treasurer of Johnson Yokogawa
Corporation (a joint venture of Yokogawa Electric Corporation and Johnson
Controls, Inc.)
Messrs. Howe, Dawson and Dean were first elected to the Board of Directors
effective August 17, 1998. Mr. Curran became a director on October 21, 1998, and
Mr. Fort became a director on January 26, 1999. Each has served as a director
continuously since his election. In June 1999, Mr. Kauer was elected to the
Company's Board of Directors to fill a vacancy on the Board.
INFORMATION CONCERNING THE DIRECTORS,
EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS
SECURITY OWNERSHIP OF DIRECTORS, OFFICERS, AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information with respect to the
beneficial ownership of Company Common Stock as of March 17, 2000, by: (i) any
person or group known by the Company to beneficially own more than five percent
of the outstanding shares of Company Common Stock; (ii) each of the Company's
directors and named executive officers; and (iii) all directors and executive
officers as a group.(1)
<TABLE><CAPTION>
SHARES
BENEFICIALLY PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED (2) OF CLASS
- - -------------------------------------------------------------- ------------ ----------
<S> <C> <C>
DLJ Merchant Banking Partners II, L.P. and
related investors(3)(4).................................. 1,043,584 71.5%
399 Venture Partners, Inc. and related investors(5)........... 266,666 18.3%
Thompson Dean(6).............................................. -- --
William F. Dawson, Jr.(6)..................................... -- --
David Y. Howe(7).............................................. -- --
Randall E. Curran............................................. -- --
John F. Fort III.............................................. 1,200 *
David A. Kauer................................................ 27 *
Michael R. Elia............................................... 200 *
All directors and executive officers
as a group (7 persons)(6)(7)............................. 1,427 *
- - -------------
</TABLE>
* Represents less than 1%.
(1) On August 17, 1998, a series of transactions involving the Company was
completed. These transactions included, among other things, the formation
by the Company (then a wholly owned subsidiary of Insilco) of a wholly
owned subsidiary ("ReorgSub"), followed by the merger of ReorgSub with and
into Insilco (the "Reorganization Merger"), pursuant to which each
stockholder of Insilco had his or her shares of Insilco Corporation
converted into the same number of shares of the Company and the right to
receive $0.01 per share in cash, and the Company became the parent of
Insilco.
Promptly following the Reorganization Merger, a second merger took place
pursuant to which Silkworm Acquisition Corporation ("Silkworm"), an
affiliate of Donaldson, Lufkin & Jenrette Merchant Banking Partners, II,
L.P. ("DLJMB"), merged with and into the Company (the "Merger," and
together with the Reorganization Merger, the "Mergers") and each share of
the Company's Common Stock was converted into the right to receive $43.47
in cash and 0.03378 of a share of the Company's Common Stock. Thus, as a
result of the Mergers, each stockholder of Insilco, in respect of each of
his or her shares, received $43.48 in cash and retained 0.03378 of a share
of the Company's Common Stock. Concurrently with the consummation of the
Mergers, the DLJMB Funds purchased 1,400,000 shares of the Company 15%
Senior Exchangeable Preferred
3
<PAGE>
Stock due 2012 (the "PIK Preferred Stock"), and warrants to purchase
65,603 shares of the Company's Common Stock at an exercise price of $0.001
per share (the "DLJMB Warrants").
Following the Mergers, (i) Insilco's existing stockholders retained, in
the aggregate, approximately 10.1% (9.4% on a fully diluted basis) of the
outstanding shares of the Company's Common Stock; (ii) the DLJMB Funds
held approximately 69.0% (69.8% on a fully diluted basis) of the
outstanding shares of the Company's Common Stock; (iii) 399 Venture
Partners Inc., an affiliate of Citibank, N.A. ("CVC"), purchased shares of
Silkworm which in the Merger were converted into approximately 19.3%
(17.8% on a fully diluted basis) of the outstanding shares of the
Company's Common Stock; and (iv) management of the Company purchased
approximately 1.7% (1.5% on a fully diluted basis) of the outstanding
shares of the Company's Common Stock.
Immediately prior to the effectiveness of the Reorganization Merger, each
outstanding option to acquire shares of the common stock of Insilco
granted to employees and directors, whether or not vested (the "Options")
was canceled and in lieu thereof, each holder of an Option received a cash
payment in an amount equal to (x) the excess, if any, of $45.00 over the
exercise price of the Option multiplied by (y) the number of shares
subject to the Option, less applicable withholding taxes (the "Option Cash
Payments"). Certain holders of such Options elected to utilize amounts
otherwise receivable by them to purchase equity or equity units of the
Company.
(2) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission, which generally attribute beneficial
ownership of securities to persons who possess sole or shared voting power
and/or investment power with respect to those securities.
(3) Includes 65,603 shares of the Company's Common Stock issued following
exercise on March 12, 1999 of the DLJMB Warrants issued in connection with
the PIK Preferred Stock. Also includes 22,425 shares of the Company's
Common Stock issued following exercise on March 12, 1999 of warrants,
which were issued as part of the Company's Units purchased by the DLJ
Mezzanine Investors (as defined herein).
(4) Consists of shares held directly by the following investors related to
DLJMB: DLJ Offshore Partners II, C.V. ("Offshore"), a Netherlands Antilles
limited partnership, DLJ Diversified Partners, L.P. ("Diversified"), a
Delaware limited partnership, DLJMB Funding II, Inc. ("Funding"), a
Delaware corporation, DLJ Merchant Banking Partners II-A, L.P.
("DLJMBPIIA"), a Delaware limited partnership, DLJ Diversified Partners-A.
L.P. ("Diversified A"), a Delaware limited partnership, DLJ Millennium
Partners, L.P. ("Millennium"), a Delaware limited partnership, DLJ
Millennium Partners-A, L.P. ("Millennium A"), a Delaware limited
partnership, DLJ EAB Partners, L.P. ("EAB"), a Delaware limited
partnership, UK Investment Plan 1997 Partners ("UK Partners"), a Delaware
partnership, DLJ First ESC L.P. ("DLJ First ESC"), a Delaware limited
partnership, and DLJ ESC II, L.P. ("DLJESCII"), a Delaware limited
partnership. See "Board of Director Interlocks and Insider
Participation"). The address of each of DLJMB, Diversified, Funding,
DLJMBPIIA, Diversified A, Millennium, Millennium A, DLJ First ESC, DLJ ESC
II and EAB is 277 Park Avenue, New York, New York 10172. The address of
Offshore is John B. Gorsiraweg 14, Willemstad, Curacao, Netherlands
Antilles. The address of UK Partners is 2121 Avenue of the Stars, Fox
Plaza, Suite 3000, Los Angeles, California 90067.
(5) The address of 399 Venture Partners, Inc. is 399 Park Avenue, New York,
New York, 10022-4614.
(6) Messrs. Dean and Dawson are officers of DLJMB Inc., an affiliate of DLJMB
and the Initial Purchaser. The business address of Messrs. Dean and Dawson
is DLJMB Inc., 277 Park Avenue, New York, New York 10172. Share data shown
for such individuals exclude shares shown as held by the DLJMB Funds, as
to which such individuals disclaim beneficial ownership.
(7) Mr. Howe is an officer of Citicorp Venture Capital, Ltd., an affiliate of
399 Venture Partners, Inc. The business address of Mr. Howe is 399 Park
Avenue, New York, NY 10022-4614. Share data shown for Mr. Howe excludes
shares shown as held by 399 Venture Partners, Inc., as to which Mr. Howe
disclaims beneficial ownership.
4
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company had four (4) regular meetings and
two (2) special meetings during 1999. Each of the directors attended 75% or more
of the total number of the Board of Directors meetings held during 1999. The
Board of Directors has no standing Audit or Compensation Committees.
DIRECTOR COMPENSATION
During fiscal 1999, Messrs. Fort and Curran received compensation for
their services as directors. Mr. Fort received compensation of $10,000 for two
board meetings he attended as a director, and $50,000 for two meetings he
attended as the Chairman of the Board. On October 20, 1999, Mr. Fort also
received a stock option grant of 5,000 shares. Mr. Curran received compensation
of $12,000 for the four meetings he attended as a director. On October 20, 1999,
Mr. Curran also received a stock option grant of 1,112 shares. Messrs. Fort and
Curran also received reimbursement for reasonable and customary travel expenses.
EXECUTIVE OFFICERS
Set forth below is the name, age and office of each "executive officer" of
the Company (as defined by the Securities and Exchange Commission).
David A. Kauer, age 44 President and Chief Executive Officer
Michael R. Elia, age 41 Senior Vice President, Chief Financial
Officer, Treasurer, and Secretary
Executive officers are elected annually to serve for a year or until their
successors are elected. During the past five years, Mr. Kauer has had the
business experience set forth above under "Directors," while the other executive
officer has had the business experience described below. Unless otherwise
stated, positions are with the Company.
MICHAEL R. ELIA
Mr. Elia has been the Senior Vice President, Chief Financial Officer,
Treasurer, and Secretary (since June 1999) and Vice President and Controller
(August 1998 to June 1999). He served as Chief Financial Officer of Jordan
Telecommunication Products from February 1997 to August 1998, and as Director of
Strategic Planning Fieldcrest Cannon, Inc. from 1994 to 1997. From 1983 through
1993, he held senior financial positions with Insilco's Technologies Group.
Prior to joining Insilco, he was with Ernst & Young LLP.
5
<PAGE>
EXECUTIVE COMPENSATION
The aggregate remuneration of the Chief Executive Officer and the four
other most highly compensated executive officers of the Company whose salary and
bonus exceeded $100,000 for the fiscal year ended December 31, 1999, is set
forth in the following table:
SUMMARY COMPENSATION TABLE
<TABLE><CAPTION>
Long-Term Compensation
-------------------------------
Annual Compensation Awards
--------------------- -------------------------------
Securities
Name and Principal Other Annual Underlying All Other
Position Year Salary ($) Bonus ($) Compensation ($) Options (#) Compensation ($)
=================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Robert L. Smialek(1) 1999 $275,000 -- -- -- $2,610,952(6)
President and CEO 1998 550,000 -- -- -- 13,519(7)
1997 550,000 300,000 -- -- 9,901(8)
David A. Kauer(2) 1999 255,000 122,000 -- 20,000 3,342(9)
President and CEO 1998 196,667 40,000 -- -- 93,830(10)
1997 164,000 80,000 -- 10,000 3,369(11)
Kenneth H. Koch(1) 1999 90,000 -- -- -- 395,702(12)
Vice President, General 1998 173,500 27,500 -- -- 393,254(13)
Counsel and Secretary 1997 162,833 75,000 -- 10,000 3,314(14)
Leslie G. Jacobs(1) 1999 88,000 -- -- -- 385,698(15)
Vice President, Human 1998 174,167 13,500 13,500(5) -- 388,921(16)
Resources and Assistant 1997 165,000 70,000 -- 10,000 4,031(17)
Secretary
Michael R. Elia(3) 1999 185,000 29,500 29,500(5) 10,000 2,905(18)
Senior Vice President , 1998 70,288 44,875(4) 14,875(5) -- 99,294(19)
Chief Financial Officer, 1997 -- -- -- --
Treasurer and Secretary
- - --------------
</TABLE>
(1) Messrs. Smialek, Koch, and Jacobs resigned from the Company in June 1999.
(2) Mr. Kauer was named President and Chief Executive Officer of the Company
in June 1999.
(3) Mr. Elia joined the Company August 1, 1998, and was named Senior Vice
President, Chief Financial Officer, Treasurer and Secretary in June 1999.
(4) Includes $30,000 sign-on bonus.
(5) Portion of bonus deferred to purchase equity units.
(6) Includes employer contributions under the Company's Employee Thrift Plan
401(k) (the "Thrift Plan") ($2,400), severance payout for stock repurchase
($769,275), nonqualified stock repurchase ($999,990), severance salary
($700,000), severance bonus ($75,000), medical reimbursements of ($782),
insurance premiums paid by the Company ($4,275) and payment in lieu of
vacation ($59,230).
(7) Includes Thrift Plan contributions ($2,400), insurance premiums paid by
the Company ($7,643) and medical reimbursements ($3,476).
(8) Includes Thrift Plan contributions ($2,250) and insurance premiums paid by
the Company ($7,501).
6
<PAGE>
(9) Includes Thrift Plan contributions ($2,400) and insurance premiums paid by
the Company ($942).
(10) Includes monies received from the Value Appreciation Agreement ($90,300),
Thrift Plan contributions ($2,400) and insurance premiums paid by the
Company ($1,130).
(11) Includes Thrift Plan contributions ($2,400) and insurance premiums paid by
the Company ($969).
(12) Includes severance payout for stock repurchase ($2,565), nonqualified
stock repurchase ($299,970), insurance premium paid by the Company ($767),
Thrift Plan contributions ($2,400), and severance salary ($90,000).
(13) Includes monies received from the Value Appreciation Agreement ($390,000),
Thrift Plan contributions ($2,400) and insurance premiums paid by the
Company ($854).
(14) Includes Thrift Plan contributions ($2,400) and insurance premiums paid by
the Company ($791).
(15) Includes nonqualified stock repurchase ($99,990), severance salary
($164,000), return of prior year deferred bonus ($13,500), life insurance
paid by the Company ($1,561), Thrift Plan contributions ($2,400),
severance bonus ($92,400), and pay in lieu of vacation ($11,847).
(16) Includes monies received from the Value Appreciation Agreement ($384,800),
Thrift Plan contributions ($2,400) and insurance premiums paid by the
Company ($1,721).
(17) Includes Thrift Plan contributions ($2,400) and insurance premiums paid by
the Company ($1,631).
(18) Includes Thrift Plan contributions of ($2,400) and insurance premiums paid
by the Company ($505).
(19) Includes moving expenses ($98,728), Thrift Plan contributions ($319) and
insurance premiums paid by the Company ($247).
7
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides certain information regarding stock options
granted during 1999 to each of the executive officers named in the Summary
Compensation Table.
<TABLE><CAPTION>
Individual Grants
----------------------------------------------------- (f)
(c) Potential Realizable Value
% of Total At Assumed Annual Rates Of
Options Stock Price Appreciation For
(b) Granted To (d) (e) Option Term(1)
(a) Options Employees In Exercise Expiration
Name Granted (#) Fiscal Year Price ($/Sh) Date 5%($) 10%($)
---- ----------- ----------- ------------ ---- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Robert L. Smialek
David A. Kauer 20,000(2) -- $293,122
Kenneth H. Koch
Leslie G. Jacobs
Michael R. Elia 10,000(3) -- 146,561
</TABLE>
(1) The amounts under the columns labeled "5%($)" and "10%($)" are included by
the Company pursuant to certain rules promulgated by the Securities and
Exchange Commission and are not intended to forecast future appreciation,
if any, in the price of the Company's Common Stock. Such amounts are based
on the assumption that the option holders will hold the options granted
for their full term. The actual value of the options will vary in
accordance with the market price of the Company's Common Stock.
(2) On January 1, 1999, an option to purchase 10,000 shares of Common Stock
was granted to Mr. Kauer at an exercise price equal to $45.00. These
options vest and become exercisable through financial criteria, or if
those criteria are not met, the options vest on the earlier of a
liquidation event, as defined by the plan, or the eighth anniversary of
the grant date and terminate on December 31, 2008. On July 22, 1999, an
option to purchase 10,000 shares of Common Stock was granted to Mr. Kauer
at an exercise price equal to $45.00. These options vest and become
exercisable through financial criteria, or if those criteria are not met,
the options vest on the earlier of a liquidation event, as defined by the
plan, or the eighth anniversary of the grant date and terminate on July
21, 2009.
(3) On January 1, 1999, an option to purchase 5,000 shares of Common Stock was
granted to Mr. Elia at an exercise price equal to $45.00. These options
vest and become exercisable through financial criteria, or if those
criteria are not met, the options vest on the earlier of a liquidation
event, as defined by the plan, or the eighth anniversary of the grant date
and terminate on December 31, 2008. On July 22, 1999, an option to
purchase 5,000 shares of Common Stock was granted to Mr. Elia at an
exercise price equal to $45.00. These options vest and become exercisable
through financial criteria, or if those criteria are not met, the options
vest on the earlier of a liquidation event, as defined by the plan, or the
eighth anniversary of the grant date and terminate on July 21, 2009.
8
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table provides certain information regarding the number and
the value of stock options exercised during 1999 and the value of stock options
held by the named executive officers at fiscal year end.
<TABLE><CAPTION>
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT FISCAL
YEAR-END (#) YEAR-END ($)(1)
-------------------------------- ---------------------------------
SHARES
ACQUIRED ON VALUE
EXERCISE REALIZED
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - ------------------ ------------- ------------- --------------- --------------- ------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Robert L. Smialek
David A. Kauer 20,000
Kenneth R. Koch
Leslie G. Jacobs
Michael R. Elia 10,000
</TABLE>
(1) Represents the total gain which would have been realized if all in-the-money
options held at fiscal year end had been exercised, determined by
multiplying the number of shares underlying the options by the difference
between the per share option exercise price and per share fair market
value at year end. An option is in-the- money if the fair market value of
the underlying shares exceeds the exercise price of the option.
RETIREMENT PLAN AND SUPPLEMENTAL ARRANGEMENTS
The Company's Retirement Plan for Salaried Employees (the "Retirement
Plan") provides retirement benefits for salaried employees, including officers.
The Company compensates employees for the loss of benefits which otherwise would
result because of the limitations the Internal Revenue Code places on pensions
that may be paid under tax-qualified retirement plans such as the Retirement
Plan. The unfunded supplemental retirement payments are accounted for as
operating expenses when earned.
The following table shows the estimated annual retirement allowances
payable after retirement at normal retirement age to persons in the following
specified remuneration and years-of-service classifications (before any
deductions for joint or survivorship payments) without regard to any statutory
limitations imposed by the Internal Revenue Code. Normal retirement allowances,
beginning at age 65, equal (i) 50% of final average compensation minus (ii) 50%
of the retiree's primary social security benefit, pro-rated if total service is
less than 25 years or, in certain cases, is less than 35 years. Five years of
service is required for vesting.
9
<PAGE>
<TABLE><CAPTION>
FINAL YEARS OF SERVICE
AVERAGE
EARNINGS(1) 15 20 25 30 35
===============================================================================================
<S> <C> <C> <C> <C> <C>
$125,000 $ 33,385 $ 44,514 $ 55,642 $ 55,642 $ 55,642
150,000 40,885 54,514 68,142 68,142 68,142
175,000 48,385 64,514 80,642 80,642 80,642
200,000 55,885 74,514 93,142 93,142 93,142
250,000 70,885 94,514 118,142 118,142 118,142
300,000 85,885 114,514 143,142 143,142 143,142
350,000 100,885 134,514 168,142 168,142 168,142
400,000 115,885 154,514 193,142 193,142 193,142
450,000 130,885 174,514 218,142 218,142 218,142
500,000 145,885 194,514 243,142 243,142 243,142
550,000 160,885 214,514 268,142 268,142 268,142
600,000 175,885 234,514 293,142 293,142 293,142
650,000 190,885 254,514 318,142 318,142 318,142
</TABLE>
(1) The higher of: (i) the average annual compensation for any five
consecutive calendar years during the final 10 years of employment; or
(ii) the average annual compensation for the last 60 months of employment.
Compensation consists of salary (including voluntary salary deferrals) and
bonus. Supplemental payments are based on average earnings in excess of
$160,000.
At December 31, 1999, Messrs. Smialek, Koch, Kauer, Jacobs and Elia were
credited, under the Retirement Plan and various supplemental arrangements, with
approximately 5.7, 5.2, 5.3, 8.9, and 10.7 years of service, respectively, for
purposes of determining their pensions. Messrs. Smialek, Koch, and Jacobs
resigned from the Company in June 1999.
EMPLOYMENT AND SEVERANCE BENEFIT AGREEMENTS
The following is a description of the employment agreements with certain
of Insilco's executive officers at the end of the 1999 fiscal year.
In December 1996, the Company entered into a Value Appreciation Agreement
with Messrs. Jacobs, Koch, Kauer and certain other officers. The Value
Appreciation Agreement provided that the executives would be entitled to receive
a commission from the Company in certain circumstances following a transaction
giving rise to a change in control. Upon consummation of the Mergers, a
commission on the sale of $2.6 million was paid and the Value Appreciation
Agreement was terminated.
In December 1996, the Company entered into Income Protection Agreements
with Messrs. Jacobs, Koch, Kauer and certain other officers. The Income
Protection Agreements provide that in the event of termination of an executive's
employment by the Company without cause, or, in certain circumstances, by the
executive, the executive will be entitled to receive certain severance benefits.
The benefits payable to the executive in the event of a termination of
employment covered by the Income Protection Agreement are as follows: (i) one
year's base salary; (ii) a bonus equal to the bonus paid to executive in 1996 or
the target bonus for the year in which employment is terminated; (iii) continued
participation in the Company's benefit plans for the duration of the severance
period; (iv) continuation of any rights to indemnification from the Company; and
(v) certain outplacement services. The Income Protection Agreements have
three-year terms and automatically renew for subsequent one-year terms, unless
terminated by either party.
The following is a description of the severance agreements signed by
Messrs. Smialek, Jacobs and Koch upon their resignations in June 1999.
Mr. Smialek's severance agreement included the following items: a) salary
($700,000); b) bonus ($75,000); c) stock investment repurchase ($769,275); d)
nonqualified stock repurchase ($999,990); and e) pay in lieu of vacation
($59,230). These items were paid in 1999.
10
<PAGE>
Mr. Jacobs' severance agreement provided the following items: a) salary
($176,000); b) bonus ($92,400); c) return of prior year deferred bonus
($13,500); d) nonqualified stock repurchase ($99,990); and e) pay in lieu of
vacation ($11,847). These items were payable in 1999 and 2000.
Mr. Koch's severance agreement provided the following items: a) salary
($180,000); b) bonus ($94,500); c) stock investment repurchase ($2,565); d)
nonqualified stock repurchase ($299,970); and e) pay in lieu of vacation
($7,269). These items were payable in 1999 and 2000.
THE FOLLOWING COMPENSATION COMMITTEE REPORT AND PERFORMANCE GRAPH WILL NOT BE
DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING BY
REFERENCE THIS PROXY STATEMENT INTO ANY OF THE COMPANY'S FILINGS UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED, EXCEPT TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS
INFORMATION BY REFERENCE, AND WILL NOT OTHERWISE BE DEEMED FILED UNDER SUCH
ACTS.
BOARD COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
OVERVIEW
The Board of Directors, with the advice of the Chief Executive Officer,
reviews and evaluates individual executive officers and determines the
compensation for each executive officer. In general, the Board's philosophy is
to attract, motivate and retain qualified key executives, reward individual
performance, relate compensation to Company goals and objectives and enhance
stockholder value. The Company's compensation program includes competitive base
salaries, annual bonus opportunities, competitive benefits and long-term awards
under the Insilco Holding Co. Stock Option Plan (the "Plan").
COMPENSATION OF CHIEF EXECUTIVE OFFICER
Mr. Kauer became the Company's President and Chief Executive Officer in
June 1999. In 1999, Mr. Kauer's base salary was $300,000. Determination of Mr.
Kauer's salary was primarily based on Mr. Kauer's background and experience, and
the compensation levels of executives in similar positions in comparable
businesses. Mr. Kauer received a bonus of $122,000 in 1999. This bonus was based
primarily on the Company achieving certain specific financial performance goals.
Mr. Kauer also received stock options to purchase 20,000 shares of common stock
in 1999. This award was primarily based on Mr. Kauer's performance.
Robert L. Smialek became the Company's Chief Executive Officer effective
May 1, 1993, and held that position until his resignation in June 1999. Mr.
Smialek's base salary was $550,000, of which he received $275,000 in 1999 for
his employment until his resignation. Determination of Mr. Smialek's base salary
was primarily based on Mr. Smialek's background and experience, and compensation
levels of executives in similar positions in comparable businesses. Mr. Smialek
received a severance package upon his resignation, please see further discussion
of the severance under the Employment and Severance Benefit Agreements section.
COMPENSATION OF EXECUTIVE OFFICERS
The Company's compensation program for its executive officers is based on
the following objectives:
o Total compensation of the executive officers should be linked to
the financial performance of the Company and enhancement of
stockholder value.
o The compensation paid to the executive officers of the Company
should be competitive with executive compensation levels of
similar companies so that the Company can attract, motivate and
retain qualified key executives.
o The compensation program should reward outstanding individual
performance and contributions to the Company as well as
experience.
Compensation for executive officers in 1999 consisted of base salary,
bonuses and related stock option and incentives related to the Merger. Base
salaries and bonuses were paid to executive officers (excluding the Chief
11
<PAGE>
Executive Officer) based upon each such executive officer's individual
performance, duties, responsibilities, experience and tenure, general economic
conditions, the recent financial performance of the Company, and other factors.
Bonuses paid to the executive officers were determined in accordance with a
bonus plan that required 70% of the bonus to be determined on the basis of the
Company's achieving certain specified financial performance goals, and 30% on
the basis of the Board of Directors' and the Chief Executive Officer's
evaluation of the performance of each executive officer. In addition, the Chief
Executive Officer has the discretion to make performance-related individual
awards.
The Insilco Holding Co Stock Option Plan was adopted in 1998, and stock
options were awarded under the plan to executive officers in 1999. (See summary
compensation tables). The future determination of such awards will be based on:
(a) the executive's contributions, performance and perceived ability to impact
overall business results and (b) the levels of options awarded to executives in
similar positions and at similar salary levels as compared to surveys published
by compensation consulting firms.
IMPACT OF 1993 TAX ACT CHANGES
The Budget Reconciliation Act of 1993 (the "Act") amended the Internal
Revenue Code to add Section 162(m) that bars a deduction to any publicly held
corporation for compensation paid to a "covered employee" in excess of
$1,000,000 per year (the "Dollar Limitation"). A covered employee of the Company
is any employee who appears in the Summary Compensation Table who is also
employed by the Company on December 31. The Dollar Limitation applies to tax
years beginning after 1993.
The legislation potentially impacts three components of the Company's
executive compensation package. These include base salaries, bonuses, and awards
under the Plan. The Company does not believe that the legislation as amended
will have any effect on the deductibility of compensation payable in 1999 to any
of its executive officers.
The Company believes that the Plan currently qualifies for the exemption
provided for performance based compensation and awards under the Plan will not
be subject to the Dollar Limitation.
BOARD OF DIRECTORS:
Randall E. Curran
William F. Dawson, Jr.
Thompson Dean
John F. Fort III
David Y. Howe
David A. Kauer
12
<PAGE>
PERFORMANCE GRAPHS
As a result of the Mergers on August 17, 1998, the holders of Insilco
Common Stock received $43.48 in cash and 0.03378 of a share of Company Common
Stock for each share of Insilco Common Stock.
The following Performance Graph compares the performance of the Company
with that of the Standard & Poor's 500 Index and the Russell 2000 Index. The
comparison of cumulative total return to stockholders assumes that $100 was
invested in the Common Stock of the Company and in the Standard & Poor's 500
Index and the Russell 2000 Index on August 17, 1998, the date of the Mergers and
that all dividends were reinvested.
COMPARISON OF 16 MONTH CUMULATIVE TOTAL RETURN
AMONG INSILCO CORPORATION, THE S&P 500 INDEX
AND THE RUSSELL 2000 INDEX
[PERFORMANCE GRAPH]
<TABLE><CAPTION>
08/17/98 12/31/98 12/31/99
-------- -------- --------
<S> <C> <C> <C>
INSILCO CORPORATION 100 49 57
S&P 500 INDEX 100 113 136
RUSSELL 2000 INDEX 100 104 125
</TABLE>
13
<PAGE>
The following Performance Graph compares the performance of Insilco with
that of the Standard & Poor's 500 Index and the Russell 2000 Index through the
date of the Merger, August 17, 1998. The comparison of cumulative total return
to shareholders assumes that $100 was invested in the Common Stock of Insilco on
September 15, 1993 (the effective date of the registration of the Insilco's
Common Stock under the Securities Exchange Act of 1934, as amended), and in the
Standard & Poor's 500 Index and the Russell 2000 Index on August 31, 1993, and
that all dividends were reinvested.
COMPARISON OF 60 MONTH CUMULATIVE TOTAL RETURN
AMONG INSILCO CORPORATION, THE S&P 500 INDEX
AND THE RUSSELL 2000 INDEX
[PERFORMANCE GRAPH]
<TABLE><CAPTION>
08/30/93 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
INSILCO CORPORATION 100 113 207 266 321 275 367
S&P 500 INDEX 100 101 99 133 160 209 234
RUSSELL 2000 INDEX 100 105 102 128 147 178 164
</TABLE>
14
<PAGE>
BOARD OF DIRECTOR INTERLOCKS AND INSIDER PARTICIPATION
The DLJMB Funds own approximately 71.5% of the outstanding shares of the
Company's Common Stock. Messrs. Dean and Dawson are officers of DLJMB and
directors of Insilco and the Company. Neither the Company nor Insilco is aware
of any transaction or of any currently proposed transaction, in which DLJ has
any material direct or indirect interest as a result of its ownership position
in a party to the transaction other than Insilco, except as follows:
Donaldson Lufkin & Jenrette Securities Corporation ("DLJSC") received
customary fees in connection with the distribution, as part of the financing of
the Merger, by Silkworm of units (which were converted into units of the Company
(the "Company Units") in the Merger), each unit consisting of $1,000 principal
amount at maturity of 14% Senior Discount Notes due 2008 (the "Old Notes"),
received customary fees in connection with the arranging of the syndication of
the new credit facility, received customary fees in connection with the
distribution of the Company's Units and received an advisory fee in connection
with the Mergers. In connection with the sale of the Company's Units, the
Company granted registration rights to DLJSC in connection with its
market-making activities and agreed to indemnify DLJSC against certain
liabilities, including liabilities under the Securities Act of 1933. In
addition, DLJ Capital Funding is an agent and lender under the new credit
facility. DLJ Capital Funding and DLJSC have and will receive customary fees in
connection with the provision of the new credit facility. Further, DLJ Capital
Funding, Inc., an affiliate of DLJSC, acted as syndication agent in connection
with the new credit facility for which it received certain customary fees and
expenses and DLJ Bridge Finance Inc., an affiliate of DLJSC, purchased the
bridge notes, for which it received customary fees and expenses. DLJSC has, from
time to time, provided investment banking and other financial advisory services
to Insilco in the past for which it has received customary compensation, and
will provide such services and financial advisory services to Insilco in the
future. DLJSC acted as purchaser in connection with the initial sale of the Old
Notes and received an underwriting discount of approximately $3.6 million in
connection therewith. In addition, DLJSC received a merger advisory fee of $3.5
million in cash from the Company after the consummation of the Merger. The
aggregate fees received by DLJ entities for its various services in 1999 were
approximately $0.9 million.
DLJ Investment Partners, L.P., DLJ ESC II, L.P. and DLJ Investment
Funding, Inc. (the "DLJ Mezzanine Investors"), each of which is an affiliate of
DLJMB, purchased and aggregate of approximately 50% of the Company Units and are
entitled to certain registration rights in connection therewith.
In connection with the Mergers, DLJMB and the Company entered into an
agreement with respect to registration and certain other rights.
Prior to the Mergers, Water Street Corporate Recovery Fund I, L.P. ("Water
Street"), an affiliate of Goldman, Sachs & Co. ("Goldman Sachs"), beneficially
owned approximately 45% (62% prior to the Share Repurchase) of Insilco's common
stock. Neither the Company nor Insilco is aware of any transaction or of any
currently proposed transaction in which Goldman Sachs has any material direct or
indirect interest as a result of its ownership position in a party to the
transaction other than the Company, except as follows:
Goldman Sachs advised Insilco in connection with the Mergers and received
a fee of $2.0 million payable on the consummation of the Mergers. In the
Mergers, Water Street received approximately $81.0 million and retained 62,962
shares of the Company. The Company entered into a Registration Rights Agreement
with Water Street in which Water Street has certain registration rights with
respect to such 62,962 shares.
Currently, none of the directors of the Company, with the exception of Mr.
Kauer, are employees of the Company. Mr. Kauer serves as the Company's President
and Chief Executive Officer.
Pursuant to their severance agreements signed in June 1999, the Company
has paid Messrs. Smialek, Jacobs and Koch the amounts detailed below:
Mr. Smialek's severance agreement included the following items: a) salary
($700,000); b) bonus ($75,000); c) stock investment repurchase ($769,275); d)
nonqualified stock repurchase ($999,990); and e) pay in lieu of vacation
($59,230). These items were paid in 1999.
15
<PAGE>
Mr. Jacobs' severance agreement provided the following items: a) salary
($176,000); b) bonus ($92,400); c) return of prior year deferred bonus
($13,500); d) nonqualified stock repurchase ($99,990); and e) pay in lieu of
vacation ($11,847). These items were payable in 1999 and 2000.
Mr. Koch's severance agreement provided the following items: a) salary
($180,000); b) bonus ($94,500); c) stock investment repurchase ($2,565); d)
nonqualified stock repurchase ($299,970); and e) pay in lieu of vacation
($7,269). These items were payable in 1999 and 2000.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
KPMG Peat Marwick LLP served as the Company's independent accountants and
audited the Company's financial statements for the year ending December 31,
1999. It is expected that a representative of KPMG Peat Marwick LLP will be
present at the Annual Meeting, will have the opportunity to make a statement if
he desires to do so, and will be available to respond to appropriate questions.
ANNUAL REPORT
The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1999, containing financial statements for such year and the signed
opinion of KPMG Peat Marwick LLP, independent certified public accountants, with
respect to such financial statements, has been simultaneously sent to
stockholders with this Proxy Statement. The Annual Report is not to be regarded
as proxy soliciting material, and management does not intend to ask, suggest or
solicit any action from the stockholders with respect to such report.
A copy of the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1999, is available without charge to stockholders on request
to:
Insilco Holding Co.
Attn: Corporate Secretary
425 Metro Place North
Dublin, Ohio 43017
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and greater than 10% stockholders, to file
reports of ownership and changes in ownership of the Company's securities with
the Securities and Exchange Commission ("SEC"). Copies of the reports are
required by SEC regulation to be furnished to the Company. Based on its review
of such reports and written representations from reporting persons, the Company
believes that all reporting persons complied with all filing requirements during
fiscal 1999.
COST OF SOLICITATION OF PROXIES
The cost of this solicitation will be paid by the Company. In addition to
the solicitation of proxies by mail, the directors, officers and employees of
the Company may solicit proxies personally or by telephone. The Company may
request persons holding shares in their names for others to forward soliciting
materials to their principals to obtain authorization for the execution of
proxies, and the Company may reimburse such persons for their expenses in doing
so.
STOCKHOLDER PROPOSALS
Each year the Board of Directors submits its nominations for election of
directors at the Annual Meeting of Stockholders. Other proposals may be
submitted by the Board of Directors or the stockholders for inclusion in the
Proxy Statement for action at the Annual Meeting of Stockholders. Any proposal
submitted by a stockholder for inclusion in the Proxy Statement for the 2001
Annual Meeting of Stockholders which is expected to be held in May 2001 must be
received by the Company (addressed to the attention of the Corporate Secretary)
on or before April 4, 2001 (?). To be submitted at the meeting, any such
proposal must be a proper subject for stockholder action under the laws of the
state of Delaware.
16
<PAGE>
OTHER MATTERS
The only business which management intends to present at the meeting
consists of the matters set forth in this statement. Management knows of no
other matters to be brought before the meeting by any other person or group. If
any other matter should properly come before the meeting, the proxy holders will
vote thereon in their discretion. All proxies received duly executed will be
voted. You are requested to sign and date the enclosed proxy and mail it
promptly in the enclosed envelope. If you later desire to vote in person, you
may revoke your proxy, either by written notice to the Company or in person at
the meeting, without affecting any vote previously taken.
BY ORDER OF THE BOARD OF DIRECTORS
DAVID A. KAUER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
17
<PAGE>
COMMON STOCK
PROXY - INSILCO HOLDING CO.
The undersigned stockholder of Insilco Holding Co. (the "Company") hereby
appoints David A. Kauer and Robert J. Tannous, or either one of them, as
attorneys and proxies with full power of substitution to vote all shares of
Common Stock of the Company which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of the Company to be held at the Corporate
Headquarters of Insilco Holding Co. at 425 Metro Place North, Dublin, Ohio
43017, on May 18, 2000, at 10:00 a.m., local time, and at any adjournments or
postponements thereof as follows:
1. THE ELECTION OF DIRECTORS.
|_| FOR all nominees listed below (except as marked to the contrary)
|_| WITHHOLD AUTHORITY to vote for all nominees listed below
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME BELOW.)
Randall E. Curran o William F. Dawson, Jr. o Thompson Dean
John F. Fort III o David Y. Howe o David A. Kauer
2. IN THEIR DISCRETION TO VOTE UPON SUCH OTHER MATTERS AS MAY PROPERLY COME
BEFORE THE MEETING.
THIS PROXY, WHEN EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE
UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1 AND 2.
The undersigned hereby acknowledges receipt of the Notice of the Annual
Meeting of Stockholders, dated April 18, 2000, and the Proxy Statement furnished
therewith. Any proxy heretofore given to vote said shares hereby is revoked.
PLEASE SIGN AND DATE THIS PROXY BELOW AND RETURN IN THE ENCLOSED ENVELOPE.
Dated: , 2000
--------------------------
---------------------------------------
(Signature)
---------------------------------------
(Signature)
Signature(s) must agree with the name(s)
printed on this Proxy. If shares are
registered in two names, both
stockholders should sign this Proxy.
When signing as attorney, executor,
administrator, trustee or guardian,
please give your full title.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
