HOWARD B. WOLF, INC.
3710 Rawlins Street
Dallas, Texas 75219-4238
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 21, 1999
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of Howard B. Wolf,
Inc. (the "Company"), a Texas corporation, for use at the Annual
Meeting of Shareholders of the Company to be held in Dallas, Texas on
September 21, 1999 and at any adjournments thereof for the purposes
set forth in the accompanying Notice of Annual Meeting of
Shareholders.
The Company's Annual Report for the year ended May 31, 1999,
which contains the Company's financial statements, is enclosed with
this Proxy Statement and the accompanying Proxy, all of which are
first being sent or given to the shareholders of the Company on August
27, 1999. The Annual Report is not to be regarded as proxy
solicitation material.
REVOCATION OF PROXY
The giving of a proxy does not preclude the right to vote in
person should the person giving the proxy so desire, and the person
giving the proxy has the power to revoke it at any time before it has
been exercised by executing a new proxy or filing a written request to
revoke with the Secretary of the Company.
QUORUM AND VOTING
In accordance with the Bylaws of the Company, the presence, in
person or by proxy, of the holders of a majority of the outstanding
shares of Common Stock entitled to vote is necessary to constitute a
quorum at the meeting. If a quorum is not present or represented at
the meeting the shareholders entitled to vote thereat, present in
person or represented by proxy, have the power to adjourn the meeting
from time to time, without notice other than the announcement at the
meeting, until a quorum is present or represented. At any such
adjournment meeting at which a quorum is present or represented, any
business may be transacted at the meeting as originally notified.
On each matter submitted to a vote of the shareholders at the
annual meeting or any adjournment thereof, each shareholder shall be
entitled to one vote in person or by proxy for each share of Common
Stock owned of record as of the close of business of August 6, 1999.
SOLICITATION OF PROXIES
The enclosed proxy is solicited by and on behalf of the Board of
Directors of the Company. The expense of solicitation of the proxies
for the 1999 Annual Meeting, including the cost of mailing, will be
borne by the Company.
<PAGE>
In addition to the use of the mails, the Company may request
persons holding stock in their name or custody, or in the name of
nominees, to send proxy materials to their principals and request
authority for the execution of the proxies, and the Company will
reimburse such person for their expense in so doing.
To the extent necessary in order to assure sufficient
representation at the 1999 Annual Meeting, officers and regular
employees of the Company and others regularly retained by the Company,
at no additional compensation, will request the return of the proxies
personally, by telephone or telegram. The extent to which this will be
necessary depends entirely on how promptly proxies are received and
shareholders are urged to send their proxies without delay. In
addition, the Company may make arrangements with brokers, nominees,
fiduciaries and other custodians to reimburse them for their charges
and expenses in forwarding proxy materials to the beneficial owners of
the Company's stock. Management has no knowledge or information that
any other person will specially engage any persons to solicit proxies.
VOTING RIGHTS, ACTION TO BE TAKEN UNDER PROXY
AND PRINCIPAL SHAREHOLDERS
The proxy which is enclosed with this Proxy Statement and Notice
of Annual Meeting, contains a space where each shareholder may
indicate whether the shareholder chooses to vote his or her shares in
favor of, against or withhold his or her vote in, the election of each
of the six persons nominated for election as director. If the proxy is
returned to the Company and the shareholder specifies how the proxy is
to be voted, it will be voted in accordance with this instruction. If
the proxy is returned to the Company and no indication is given as to
how the proxy is to be voted, the proxy will be voted in the favor of
the election of as directors of the six persons nominated. A proxy may
be revoked at any time before it is exercised either by furnishing the
Secretary of the Company written notice of revocation, by properly
executing and submitting a subsequently dated proxy or by attending
the meeting and voting in person. There are no matters to be acted
upon which give rise to rights of appraisal or similar rights of
dissenting shareholders under applicable state law.
The close of business on August 6, 1999 has been fixed as the
record date for the determination of shareholders of the Company
entitled to notice of and to vote at the 1999 annual meeting of
shareholders. On that date there were outstanding and entitled to vote
at the meeting 1,056,191 shares of the Company's common stock, $0.33
1/3 par value (the "Common Stock"), constituting all of the
outstanding voting securities of the Company. Each share of Common
Stock is entitled to one vote. As of that date, to the knowledge of
the management of the Company the table below shows the total number
of shares and percent beneficially owned by shareholders owning more
than five percent of the Company's common stock.
<PAGE>
Amount
Name and Address and Nature of
of Beneficial Beneficial Percent
Title of Class Owner Ownership of Class
-------------- ----- --------- --------
Common Stock Howard B. Wolf(1) 254,729 (Direct) 24.1
3710 Rawlins Street
Dallas, Texas 75219-4238
Common Stock Robert D. Wolf 161,289 (Direct) 15.3
3710 Rawlins Street
Dallas, Texas 75219-4238
(1) Mr. Wolf disclaims any beneficial interest in 40,600 shares that
are held of record by him as trustee for certain private charitable
foundations created by him. In addition, Lois C. Wolf (wife of Howard
B. Wolf) owns 42,665 shares over which she has sole voting and
investment powers. (See also footnote (3) below).
As of August 6, 1999 the following table shows the number of
shares beneficially owned by each of the directors and by all
directors and officers of the Company as a group.
Amount and Nature
Name of of Beneficial Percent
Beneficial Owner Ownership (1) of Class
---------------- ------------- --------
Creed L. Ford III 1,000 (Direct) .1
Eugene K. Friesen 36,580 (Direct) 3.5
Joel Held - -
Juan M. Villamizar - -
Howard B. Wolf (2)(3) 254,729 (Direct) 24.1
Robert D. Wolf (2)(4) 161,289 (Direct) 15.3
All officers and directors as
a group (6 persons)(2)(3)(4) 453,598 42.9
(1) The persons listed have the sole power to vote and dispose of
the shares owned of record by them except as noted below.
(2) Howard B. Wolf is the father of Robert D. Wolf. Each of such
persons wholly disclaims any beneficial ownership of shares owned
by the other.
(3) Lois C. Wolf (wife of Howard B. Wolf) owns 42,665 shares over
which she has sole voting and investment powers. In addition to
the 254,729 shares 40,600 shares are owned by an "affiliate" of
Mr. Wolf as that term is defined in the General Rules and
Regulations under the Securities Exchange Act of 1934, and are
held of record by Mr.Wolf as trustee for certain private
charitable foundations created by him. Mr. Wolf disclaims any
beneficial interest in the shares.
(4) Includes 1,000 shares held as trustee for his daughter (see
also footnote (2) above).
<PAGE>
The Company does not know of any arrangement or pledge of its
securities by persons now considered in control of the Company that
might result in a change in control of the Company.
NOMINEES AND ELECTION OF DIRECTORS
In accordance with the Bylaws of the Company, action will be
taken at the 1999 Annual Meeting to elect six Directors to hold
office until the annual meeting of shareholders in 2000 or until their
successors have been duly elected and qualified. The Company
recommends that the shareholders elect each of the following six
persons who are management's nominees, to serve as Directors of the
Company, all for whom are presently held, the principal occupation or
employment of the nominee, the period during which the nominee has
served as a Director of the Company and other directorships of
publicly held companies served by the nominees. Each of the nominees
named has been engaged in the principal occupation or employment
indicated during the past five years.
Nominee and Served as
Principle Director Other
Occupation Age Since Directorships
---------- --- ----- -------------
Creed L. Ford III (2) 46 1992 Brinker International, Inc.
Chairman & Chief Operator of Restaurants
Executive Officer 1993/1996
Fired Up, Inc. None
1997/1999
Eugene K. Friesen (1) 67 1975 None
Senior Vice President
& Treasurer
Howard B. Wolf, Inc.
Joel Held (2) 60 1984 None
Attorney at Law
Arter & Hadden
Juan M. Villamizar 46 1985 None
Purchasing Executive
Howard B. Wolf, Inc.
April 1981/March 1999
Consultant
April 1999/August 1999
Howard B. Wolf (1) 80 1952 None
Chairman of the Board
Howard B. Wolf, Inc.
Robert D. Wolf (1) 46 1981 None
President
Howard B. Wolf, Inc.
(1) Member of Executive Committee
(2) Member of Audit Committee
<PAGE>
Employees of the Company who are also Directors do not receive
any fee or remuneration for services as members of the Board of
Directors or of any Committee of the Board of Directors. Non-
management Directors receive per annum a retainer fee of $9,600 and
reimbursement of medical expenses up to $1,620.
During the 1999 fiscal year the Board of Directors held six
meetings. All members attended at least seventy five percent of the
total number of meetings. The Executive Committee (which has the
authority to act on most matters in the business and affairs of the
Company requiring Board action) held six meetings during the year
which were attended by all members.
The Board of Directors does not have a standing compensation or
nominating committee or a committee that performs similar functions.
Audit Committee members appointed by the Board of Directors on
September 15, 1998, consisting of Joel Held, Chairman, and Creed L.
Ford III, held two meetings during the 1999 fiscal year, which were
attended by all members. The Audit Committee considered the comments
of the independent auditors and reviewed the scope of the annual
audit.
If any nominee for election as a director named herein becomes
unable or unwilling to accept election, the proxy holders will vote
for the election in is stead of such other person as the Company's
Board of Directors recommends. Management has no reason to believe
that any of the nominees will be unable or unwilling to serve if
elected to office, and each nominee has expressed to management his
intention to serve the entire term for which election is sought. To
be elected as a director, each nominee must receive the favorable vote
of the majority of the shares of Common Stock present in person or by
proxy at the Annual Meeting.
<PAGE>
EXECUTIVE COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT AND OTHERS
The following tables set forth compensation paid to or for the
benefit of the executive officers (3) named below in 1999, 1998 and
1997.
SUMMARY COMPENSATION TABLE
<TABLE>
Long Term Compensation
__________________________
Annual Compensation Awards Payouts
____________________ _________________ _______
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other All
Annual Restricted Other
Name and Compen- Stock LTIP Compen-
Principal Fiscal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)(1)
- -------- ---- ------- ------ ------ ---- ---- ---- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert D. 1999 156,667 - 12,915 - - - 54,808
Wolf, 1998 170,000 3,269 18,102 - - - -
President 1997 170,000 62,889 17,750 - - - -
Howard B. 1999 130,000 - 15,333 - - - 43,846
Wolf, 1998 150,000 2,885 15,600 - - - -
Chairman 1997 150,000 55,871 15,600 - - - 23,016(2)
Eugene K. 1999 105,000 - 10,650 - - - 38,365
Friesen, 1998 105,000 2,019 10,650 - - - -
Senior Vice 1997 105,000 42,684 10,650 - - - -
President
& Treasurer
</TABLE>
(1) Consists of severance pay, vacation and continuing bonus
consistent with all employees as indicated in the Plan of
Liquidation and Dissolution as adopted by the shareholders on May
6, 1999
(2) Consists of a premium paid for a life insurance policy insuring
the life of Howard B. Wolf and payable to a beneficiary designated
by him.
Except as mentioned herein, and as previously discussed elsewhere
in this section, there are no presently outstanding contracts or
arrangements for present or future cash compensation by the Company to
any of its officers or directors,
The Company provides automobiles or allowances to certain of its
officers and executives for use in the performance of their duties.
Personal use of the automobiles, if any, is estimated to be
insignificant.
<PAGE>
The Company maintained memberships in several private clubs which
were used for sales and business related meetings by certain of its
officers and executives. In those cases where such clubs were used
for personal use, the Company was reimbursed by the individual for any
personal charges incurred.
BOARD REPORT ON EXECUTIVE COMPENSATION
The objectives of the Company's executive compensation policies
were to provide its executives with a competitive package and link
compensation to the achievement of Company business objectives and the
enhancement of shareholder. Due to the adoption of the Plan to
liquidate and dissolve the Company by the shareholders on May 6, 1999
the Board will no longer review executive compensation.
STOCK PERFORMANCE GRAPH
The adoption of the Plan of Liquidation and Dissolution by the
shareholders on May 6, 1999 has made the line graph comparing the
yearly percentage change in the cumulative shareholder return on the
Company's Common stock meaningless. Accordingly no graph is
presented.
PLAN OF LIQUIDATION AND DISSOLUTION
On May 6, 1999 the shareholders voted to adopt the Plan of
Liquidation and Dissolution as recommended by the Board of Directors
(see Proxy Statement dated and mailed April 15, 1999 to all
shareholders of record April 9, 1999 for text and details of the Plan
of Liquidation and Dissolution (the "Plan"). The shareholders voted
72.4 percent "FOR" the adoption and .3 percent "AGAINST" the adoption
of the plan.
On May 6, 1999 the Company adopted the liquidation basis of
accounting and initiated the liquidation and dissolution processes as
provided in the Plan.
<PAGE>
Based on the following estimates management believes that its
cash receipts and disbursements during the liquidating period (fiscal
years ending May 31, 2000, 2001 and 2002) will approximate $1,523,000
and $1,012,000, respectively, making cash available for shareholder
distribution of $4,283,000, or $4.06 per common share .
Beginning cash balance - June 1, 1999 $3,772,000
Cash receipts:
Collection of receivables 675,000
Investment income 110,000
Tax refund 677,000
Miscellaneous receipts 70,000
---------
Total cash receipts 1,532,000
---------
Total cash available 5,304,000
Cash disbursements:
Office operations and expenses 142,000
Professional fees 80,000
Salaries 300,000
Shareholder/SEC/AMEX/ costs 40,000
Taxes and reserves 438,000
---------
Total cash requirements 1,000,000
---------
Cash available for shareholder distribution $4,304,000
=========
(approximately $4.08 per share)
SAFE HARBOR
The Company wishes to take advantage of the "safe harbor" provisions
of the Private Securities Litigation Reform Act of 1995 with respect
to statements that may be deemed to be forward looking statements
under the Act. Such forward looking statements may include, but are
not limited to, statements regarding the liquidation of the Company's
assets. The Company cautions that numerous factors could cause actual
results to differ materially from any forward looking statements made
by the Company, including the Company's ability to collect accounts
receivable, collect amounts to be received when assets are sold and
payment of any contingent liabilities heretofore unknown.
RELATIONSHIP WITH INDEPENDENT AUDITORS OR ANY RELATED PARTIES
Lane Gorman Trubitt, L.L.P. was the independent auditor for the
Company for the fiscal year ended May 31, 1999. The firm has
performed the annual audit for the Company for more than five years.
The appointment of Lane Gorman Trubitt, L.L.P. was recommended by the
audit committee.
A representative of Lane Gorman Trubitt, L.L.P. is expected to be
present at the annual meeting of shareholders. The representative
will have the opportunity to make a statement if so desired and will
be available to respond to appropriate questions.
<PAGE>
Services performed by Lane Gorman Trubitt, L.L.P. included the
examination and report on the current financial statements, services
related to filings with the Securities and Exchange Commission,
meeting with the Audit Committee and tax review services. All
services were approved prior to the rendering of such services, and
the Board of Directors deemed such services to have no effect on the
independence of such firm.
The independent auditor for the Company for the current fiscal
year will be selected by the Board of Directors at their annual
meeting, which will be held immediately following the annual meeting
of shareholders.
There were no other relationships or related transactions with
management or any related party.
SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
In the event the Company is not liquidated and dissolved by the
date for its 2000 Annual Meeting of Shareholders, the meeting is
planned to be held September 19, 2000. A Proxy Statement and Notice
of such meeting will be mailed to all shareholders of record
approximately one month prior to that date. Any shareholder who
desires to present proposals at said annual meeting and to have such
proposals set forth in the Proxy Statement must submit the proposals
in writing to be received by the Company at its corporate office not
later than May 5, 2000. All shareholders proposals must comply with
Rule 14a-8 promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934.
GENERAL
As of the date of this statement, the Board of Directors has no
knowledge of any business which will be presented for consideration at
the meeting other than the election of Directors. With respect to any
other business which may properly come before the meeting or any
adjournment thereof, it is intended that proxies will be voted in
accordance with the judgment of the person or persons voting them.
Copies of the Annual Report on Form 10-K to the Securities and
Exchange Commission are available to shareholders upon written request
to the Treasurer, Howard B. Wolf, Inc., 3710 Rawlins Street, Suite
970, Dallas, Texas 55219-4238.
By Order of the Board of Directors
HOWARD B. WOLF,
Chairman of the Board
Dallas, Texas
August 27, 1999
