<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
STAR SERVICES GROUP, INC.
- --------------------------------------------------------------------------------
(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)(1) 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
STAR SERVICES GROUP, INC.
2075 NORTH POWERLINE ROAD
POMPANO BEACH, FLORIDA 33069
April 28, 2000
Dear Shareholders:
It has been an exciting year at Star Services Group, Inc. We have worked
very hard to meet the goals we have outlined throughout the year. We are looking
forward to the rest of the year 2000.
You are cordially invited to attend the 2000 Annual Meeting of Shareholders
of Star Services Group, Inc. which will be held at our corporate headquarters at
2075 North Powerline Road, Pompano Beach, Florida, on Friday, May 12, 2000 at
9:00 a.m., local time.
At the meeting you will be asked to elect our Board of Directors. The
accompanying Notice of Annual Meeting of Shareholders and Proxy Statement
describe in more detail the matters to be presented at the meeting. In addition,
we will be pleased to report on the affairs of the company and provide a
discussion period for questions and comments of general interest to
shareholders.
We look forward to greeting personally those shareholders who are able to
be present at the meeting. Whether or not you plan to be with us at the meeting,
it is important that your shares be represented. Accordingly, we request that
you sign and date the enclosed proxy and mail it in the envelope provided at
your earliest convenience. If you attend the meeting, you may withdraw your
proxy and vote your shares in person.
Thank you for your cooperation.
Very truly yours,
/s/ JACK R. CASAGRANDE
Jack R. Casagrande
Chairman of the Board
and Chief Executive Officer
<PAGE> 3
STAR SERVICES GROUP, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 12, 2000
To the shareholders of Star Services Group, Inc.:
NOTICE IS HEREBY GIVEN that the 2000 Annual Meeting of Shareholders of Star
Services Group, Inc., a Florida corporation (the "Company"), will be held on
Friday, May 12, 2000 at 9:00 a.m., local time, at the corporate headquarters of
the Company at 2075 North Powerline Road, Pompano Beach, Florida 33069, for the
following purposes:
1. To elect seven members of the Board of Directors to hold office
until the Company's 2001 annual meeting of shareholders or until
their successors are duly elected and qualified; and
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on April 18, 2000 as
the record date for determining those shareholders entitled to notice of, and to
vote at, the Annual Meeting and any adjournments thereof. Only shareholders of
record at the close of business on that date will be entitled to notice of, and
to vote at, the Annual Meeting.
All shareholders are cordially invited to attend the Annual Meeting in
person. Shareholders who are unable to attend the Annual Meeting in person are
requested to complete and date the enclosed form of proxy and return it promptly
in the envelope provided. No postage is required if mailed in the United States.
Any shareholder attending the meeting may vote in person even if he or she
returned a proxy. However, if a shareholder's shares are held of record by a
broker, bank or other nominee and the shareholder wishes to vote at the meeting,
the shareholder must obtain from the record holder a proxy issued in his or her
name.
By order of the Board of Directors,
Angelo Marzano
Secretary
Pompano Beach, Florida
April 28, 2000
<PAGE> 4
STAR SERVICES GROUP, INC.
2075 NORTH POWERLINE ROAD
POMPANO BEACH, FLORIDA 33069
---------------------
PROXY STATEMENT
2000 ANNUAL MEETING OF SHAREHOLDERS
---------------------
INTRODUCTION
DATE, TIME AND PLACE OF ANNUAL MEETING
The Company's Board of Directors is furnishing this Proxy Statement to
solicit proxies for use at the 2000 Annual Meeting of Shareholders to be held on
Friday, May 12, 2000, at 9:00 a.m., local time, at the corporate headquarters of
the Company at 2075 North Powerline Road, Pompano Beach, Florida 33069, and at
any adjournments thereof.
RECORD DATE AND MAILING DATE
The close of business on April 18, 2000 is the record date for the
determination of shareholders entitled to notice of, and to vote at, the Annual
Meeting. We intend to mail this proxy statement and the accompanying proxy card
on or about April 28, 2000 to all shareholders entitled to vote at the meeting.
NUMBER OF SHARES OUTSTANDING
As of the close of business on the Record Date, 8,100,000 shares of Common
Stock were issued and outstanding. Each such share is entitled to one vote on
all matters to be presented at the Annual Meeting.
VOTING AT THE ANNUAL MEETING
PROCEDURES FOR VOTING BY PROXY
If you properly sign, return and do not revoke your proxy, the persons
named as proxies will vote your shares according to the instructions you have
specified on the proxy card. If you sign and return your proxy card but do not
specify how the persons appointed as proxies are to vote your shares, your proxy
will be voted FOR the election of the nominated directors and in accordance with
the best judgment of the persons appointed as proxies as to all other matters
properly brought before the meeting. You can revoke your proxy by delivering to
the Secretary of the Company, at the Company's address as listed above, either a
written revocation of your proxy or a duly executed proxy bearing a later date
or by attending the meeting and voting in person.
REQUIREMENTS FOR SHAREHOLDER APPROVAL
A quorum will be present if a majority of the outstanding shares of Common
Stock are present in person or by valid proxy. We will count abstentions and
broker non-votes, which are described below, in determining whether a quorum
exists. To be elected, a director must receive a plurality of the votes cast by
the shares entitled to vote, provided a quorum is present. If any nominee for
election to the Board of Directors named in this Proxy Statement becomes
unavailable for election for any reason, the proxy will be voted for a
substitute nominee selected by the Board of Directors. To approve any other
matter presented for shareholder approval, the number of shares voted in favor
of the proposal must exceed the number of shares voted against the proposal,
provided a quorum is present.
<PAGE> 5
EFFECT OF ABSTENTIONS
A shareholder who is present in person or by proxy at the Annual Meeting
and who abstains from voting on any or all proposals will be included in the
number of shareholders present at the Annual Meeting for the purpose of
determining the presence of a quorum. Abstentions do not count as votes in favor
of or against a given matter.
EFFECT OF BROKER NON-VOTES
Brokers who hold shares for the accounts of their clients may vote these
shares either as directed by their clients or in their own discretion if
permitted by the exchange or other organization of which they are members.
Proxies that brokers do not vote on one or more proposals but that they do vote
on others are referred to as "broker non-votes" with respect to the proposal(s)
not voted upon. Broker non-votes are included in determining the presence of a
quorum. A broker non-vote, however, does not count as a vote in favor of or
against a particular proposal for which the broker has no discretionary voting
authority.
SOLICITATION OF PROXIES
The Company will pay the cost of proxy solicitation. Our directors,
officers and employees may, without additional compensation, solicit proxies by
personal interview, telephone, fax or otherwise. We will direct brokerage firms
or other custodians, nominees or fiduciaries to forward our soliciting material
to the beneficial owners of common stock held of record by these institutions
and will reimburse them for the reasonable out-of-pocket expenses they incur in
connection with this process.
2
<PAGE> 6
STOCK OWNERSHIP
The following table sets forth certain information with respect to the
beneficial ownership of the Company's common stock as of March 31, 2000, by (i)
each person known to the Company to own beneficially more than 5% of its
outstanding Common Stock, (ii) each of our directors, (iii) each of our
executive officers, and (iv) all of our directors and officers as a group.
Unless otherwise indicated, the address of each of the beneficial owners
identified is c/o Star Services Group, Inc., 2075 North Powerline Road, Pompano
Beach, Florida 33069. Unless otherwise indicated, each person in the table has
sole voting and investment power as to the shares shown.
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY
OWNED(1)
-------------------
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES PERCENT
------------------------------------ --------- -------
<S> <C> <C>
Charles D. Green(2)......................................... 1,112,500 13.88%
Frank P. Marzano(3)......................................... 1,112,500 13.88%
Patrick F. Marzano(4)....................................... 1,112,500 13.88%
Jack R. Casagrande(5)....................................... 645,000 7.96%
Rick Casagrande(6).......................................... 447,500 5.52%
Angelo Marzano(7)........................................... 300,000 3.70%
Samuel G. Weiss(8).......................................... 22,500 *
Thomas Roberts(9)........................................... 10,000 *
Phillip Foreman(10)......................................... 5,000 *
All directors and executive officers as a group (9
persons)(11).............................................. 4,767,500 58.85%
</TABLE>
- ---------------
* Less than 1%
(1) Percentage ownership based on 8,100,000 shares of common stock outstanding
as of March 31, 2000.
(2) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Green within 60 days of March 31, 2000.
(3) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Marzano within 60 days of March 31, 2000.
(4) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Marzano within 60 days of March 31, 2000.
(5) Includes 25,000 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Casagrande within 60 days of March 31,
2000.
(6) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Casagrande within 60 days of March 31,
2000.
(7) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Marzano within 60 days of March 31, 2000.
(8) Includes 12,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Weiss within 60 days of March 31, 2000.
(9) Includes 7,500 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Roberts within 60 days of March 31, 2000.
(10) Includes 5,000 shares of common stock subject to options either currently
exercisable or exercisable by Mr. Foreman within 60 days of March 31, 2000.
(11) Includes the information in the notes herein.
To our knowledge, based solely on a review of copies of filings furnished
to us and written or oral representations that no other reports were required,
we believe that all of our directors and executive officers complied during 1999
with the reporting requirements of Section 16(a) of the Securities Exchange Act
of 1934.
3
<PAGE> 7
PROPOSAL NO. 1 -- ELECTION OF DIRECTORS
Each of the current members of the Board of Directors has been nominated to
be reelected as a director at the Annual Meeting. Each of the nominees will
serve for a term expiring at the 2001 annual meeting of shareholders, or until
his successor has been duly elected and qualified. As of the date of this Proxy
Statement, the Board has no reason to believe that any of the persons named
below will be unable or unwilling to serve as a nominee or as a director if
elected. However, if any of them should become unavailable to serve as director,
the Board may designate a substitute nominee. In that case, the persons named as
proxies will vote for the substitute nominees designated by the Board. Certain
information concerning the nominees is set forth below.
<TABLE>
<CAPTION>
NAME AGE POSITION(S) HELD WITH THE COMPANY
---- --- -------------------------------------------------
<S> <C> <C>
Jack R. Casagrande........................... 55 Chairman of the Board, Chief Executive Officer
and Director
Patrick F. Marzano........................... 52 President, Chief Financial Officer and
Director(1)
Phillip Foreman.............................. 39 Chief Operating Officer and Director
Thomas R. Roberts............................ 50 Vice President, Environmental Compliance and
Director
Frank P. Marzano............................. 27 Director
Rick Casagrande.............................. 50 Director
Samuel G. Weiss.............................. 51 Director
</TABLE>
- ---------------
(1) Mr. Marzano assumed the title of Chief Financial Officer in April 2000
following the resignation of our former Chief Financial Officer, Richard
Loss.
Jack R. Casagrande has been the Chairman, Chief Executive Officer and a
director of the Company since inception. In 1971, Mr. Casagrande founded
Industrial Waste Services, Inc. ("IWS") in Miami-Dade County, Florida and, by
1984, the company had grown to be the largest waste hauling operation in the
county and the second largest in the State of Florida. In 1984, IWS was
purchased by Attwoods, plc and Mr. Casagrande became head of U.S. operations.
During his tenure its revenues grew from $24 million in 1984 to over $300
million by the end of 1993. Attwoods had become the fourth largest waste
services company in the United States prior to its acquisition by
Browning-Ferris Industries ("BFI") in December 1994. Since that time, Mr.
Casagrande has served as a business consultant to, and a director of, several
private companies. Jack R. Casagrande is the brother of Rick Casagrande.
Patrick F. Marzano is the founder, President, Chief Financial Officer and
a director of the Company. Mr. Marzano graduated from St. John's University in
Queens, New York in 1969 with a Bachelors of Science degree in Accounting. From
1969 to 1971, Mr. Marzano worked as a staff accountant at Price Waterhouse in
New York City. In 1971, Mr. Marzano left Price Waterhouse and started his own
accounting firm. Mr. Marzano has been a certified public accountant and a
partner in Geller, Marzano & Company CPA's PC for the last twenty-seven years.
He also has been involved as a CEO and partner/shareholder for over twenty years
in several waste companies in New York and Florida. Patrick F. Marzano is the
uncle of Angelo Marzano and the father of Frank P. Marzano.
Phillip Foreman has been the Chief Operating Officer and a director of the
Company since July 1999. From 1988 until 1993, Mr. Foreman served as the
Regional Manager for Attwoods Florida operations and then became the CEO for
Attwoods U.S. solid waste operations. As a result of the acquisition of Attwoods
by BFI, Mr. Foreman became the Divisional Vice President for BFI's Florida Gulf
Atlantic Division, where he oversaw operations generating $230 million in annual
revenues. In 1996 Mr. Foreman left BFI and has since acted as a consultant to a
number of entities in the waste industry including a consolidation group in New
Jersey. Most recently, from November 1998 to July 1999 he served as the Director
of Operations for Atlas Environmental, Inc.
Thomas R. Roberts has been Vice President, Environmental Compliance and a
director of the Company since 1998. From 1995 to 1998, Mr. Roberts served as
Vice President of Atlas Environmental, Inc.,
4
<PAGE> 8
including Atlas's 11 solely owned facilities. Mr. Roberts is the President of
the Florida Recyclers Coalition, Inc. and serves as an instructor for the
University of Florida Center for Training, Research and Education for
Environmental Occupations (TREEO Center), co-sponsored by State of Florida
Department of Environmental Protection and the Florida Sunshine Chapter of the
Solid Waste Association of North America (SWANA). Mr. Roberts received the
"Distinguished Service Award 1998" from SWANA for his coordination of Florida's
C&D Operators Training Course. Mr. Roberts has served and serves on several
Florida Department of Environmental Protection and local counties' C&D-related
Task Forces and Technical Advisory Councils. Mr. Roberts has appeared as a
speaker on C&D topics at the International WasteExpo, Florida Environmental
Expo, Recycle Florida Today, FDEP's Future of Recycling Advisory Group,
Florida's Organic Recyclers Association and FDEP's C&D Landfill Task Force.
Frank P. Marzano, a director of the Company since inception, graduated
from Pennsylvania State University in 1994 with a Bachelor of Science degree in
Accounting. Mr. Marzano is a Certified Public Accountant and worked at KPMG Peat
Marwick in New York City until 1996. In 1996, Mr. Marzano joined Geller, Marzano
& Company CPAs PC in Port Washington, New York. While working at Geller Marzano,
Mr. Marzano received his Masters in Taxation from Long Island University in
January 1998. Mr. Marzano is managing partner of Geller Marzano. Frank P.
Marzano is the son of Patrick F. Marzano and the cousin of Angelo Marzano.
Rick Casagrande, a director of the Company since inception, graduated from
Christ The King High School in Middle Village, New York in 1967. In 1971 he was
one of the co-founders of Industrial Waste Services in Miami-Dade County,
Florida. He has held various executive positions in several solid waste
management companies including American Transfer Services, Inc. He is currently
President of Total Care of Long Island. Rick Casagrande is the brother of Jack
R. Casagrande.
Samuel G. Weiss, a director of the Company since its inception, is an
attorney admitted to practice in the State of New York since 1974. He is
currently a member of the firm of Weiss & Federici, LLP in Port Washington, New
York of which he became a member in 1999. From 1988 through 1999, Mr. Weiss was
a private practitioner in Port Washington, New York. Mr. Weiss received his B.A.
degree from New York University in 1971. Mr. Weiss received his Juris Doctor
from New York University in 1974 and his LLM in taxation from New York
University in 1977. Mr. Weiss is General Counsel and a Director of Strategic
Capital Resources, Inc.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF ALL NOMINEES
NAMED ABOVE.
5
<PAGE> 9
MANAGEMENT
Our executive officers are elected annually by the Board of Directors to
serve at the discretion of the Board of Directors. Jack R. Casagrande, Partick
F. Marzano, Phillip Foreman and Thomas R. Roberts serve both on our Board of
Directors and as executive officers. "Proposal 1 - Election of Directors" above
discusses their business experience. In April 2000, Richard Loss, who served as
our Chief Financial Officer since July 1999, resigned and Mr. Patrick F. Marzano
assumed the title of Chief Financial Officer.
The other executive officers of the Company are:
<TABLE>
<CAPTION>
NAME AGE POSITION(S) HELD WITH THE COMPANY
---- --- ----------------------------------------
<S> <C> <C>
Charles D. Green..................... 64 Secretary
Angelo Marzano....................... 25 Treasurer and Assistant Secretary
</TABLE>
Charles D. Green. Mr. Green has served as Secretary of Star Services since
inception. He served two years in the United States Army as a maintenance
specialist for heavy equipment. In 1997, he formed American Refuse, Inc., a
waste hauling company, and in 1986 he and a partner started Southeastern
Reclamation, Inc., a recycling and hauling company. Mr. Green is currently a
Vice President of Delta Recycling Corp. and Eastern Recycling.
Angelo Marzano. Mr. Marzano has served as Treasurer and Assistant
Secretary of Star Services since inception. He graduated from Pennsylvania State
University in 1997, with a Bachelor of Science Degree in Business Logistics.
Throughout his college education, he maintained a position in several waste
companies. Upon graduation, Mr. Marzano began working at Delta Recycling Corp.
Mr. Marzano is responsible for developing the internal controls and procedures
for Delta Recycling Corp. Mr. Marzano is certified as a construction and
demolition landfill and materials recovery facility operator. Angelo Marzano is
the nephew of Patrick Marzano and the cousin of Frank P. Marzano.
BOARD AND COMMITTEE ACTIVITY; STRUCTURE AND COMPENSATION
During 1999, the Board of Directors had two meetings. Each of the directors
attended all of the meetings of the Board of Directors.
The Company's operations are managed under the supervision of the Board of
Directors, which has the ultimate responsibility for the establishment and
implementation of the Company's general operating philosophy, objectives, goals
and policies.
The Board of Directors has established three standing committees: the
Executive Committee, the Compensation Committee and the Audit Committee. The
Executive Committee is charged with making major management decisions and
recommending policy directions to the Board of Directors as a whole. The
Executive Committee is currently composed of Jack R. Casagrande, Phillip Foreman
and Patrick F. Marzano. The Compensation Committee is charged with recommending
to the Board the compensation for the Company's executives and administering the
Company's stock option and benefit plans. The Compensation Committee is
currently composed of Patrick F. Marzano, Jack R. Casagrande, Rick Casagrande
and Samuel Weiss. The Audit Committee is charged with recommending to the Board
the appointment of independent auditors of the Company, as well as discussing
and reviewing with the independent auditors the scope of the annual audit and
results thereof. The Audit Committee is currently composed of Patrick F.
Marzano, Rick Casagrande and Samuel Weiss.
COMPENSATION OF DIRECTORS
Directors who are officers or employees of the Company do not currently
receive any compensation for attending meetings of the Board of Directors. Each
independent director receives a fee of $1,500 for attending each board meeting
and each committee meeting (unless held on the same day as the full Board
meeting), in addition to reimbursement of reasonable expenses.
6
<PAGE> 10
EMPLOYMENT AGREEMENTS
We have entered into an employment agreement with Thomas Roberts. The
agreement has a two-year term expiring on March 2001 and provides for a salary
of approximately $104,000 and $115,000, respectively, for the first and second
years of the term. The agreement contains standard confidentiality and
non-solicitation provisions.
We have entered into an employment agreement with Michael Adams. The
agreement has a three-year term expiring on January 9, 2003 and provides a
salary of approximately $80,000 plus a reasonable bonus for each of the three
years. The agreement contains standard confidentiality and non-solicitation
provisions.
STOCK OPTION PLAN
The 1999 Stock Option Plan (the "1999 Plan") was adopted by the Board of
Directors effective as of February 3, 1999, and was approved by the shareholders
in February 1999. The 1999 Plan is intended to provide employees, consultants
and directors with additional incentives by increasing their proprietary
interests in Star Services. Under the 1999 Plan, we may grant options with
respect to 2,000,000 shares of our Common Stock. As of March 31, 2000 the
Company had options to purchase 759,000 shares of Common Stock outstanding, at a
weighted average exercise price of $.30 per share.
The Compensation Committee of the Board of Directors currently administers
the Stock Option Plan. The Compensation Committee determines the employees,
consultants and directors to whom options are granted, the type, size, and term
of the options, the grant date, the expiration date, the vesting schedule and
other terms and conditions of the options.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Management Agreement
In November 1999, we entered into an agreement to provide operational and
administrative management services to J.R. Capital Corp. ("J.R. Capital"), a
company owned by our Chairman Jack R. Casagrande. J.R. Capital owns and operates
several material recovery facilities in Florida. The agreement is for a
five-year period ending October 2004. Under the terms of the agreement, we
provide administrative and managerial functions, maintain books and records and
provide other services to J.R. Capital. In addition, we have agreed to permit
J.R. Capital to dispose of waste at a rate equal to the lesser of fair market
value or the same rate which we charge on an internal basis. In return, we
receive an annual management fee of $1,537,293, receivable in monthly
installments of $128,108. The full provisions of the agreement were deferred by
the parties until January 1, 2000. As a result, for the year ended December 31,
1999, related party management fee income totaled $20,258.
In addition, both parties allow each other to utilize any of each other's
facilities for a price equal to 90% of the fair market value for such services
charged to non-affiliate third parties. The agreement may be terminated by J.R.
Capital upon 30 days written notice and by us upon 90 days written notice.
Related Party Accounts
During 1999, we derived $290,425 of revenue for disposal fees and trucking
services provided to J.R. Capital. During 1999, we incurred $1,035,548 of costs
for disposal fees at J.R. Capital's material recovery facilities.
As of March 31, 2000, accounts payable includes net payables to J.R.
Capital of $538,014. Accounts receivable includes net receivables from J.R.
Capital of $38,160. Such payables and receivables are satisfied in the ordinary
course of business.
7
<PAGE> 11
Delta Tall Pines Corp., our wholly-owned subsidiary has entered into a
lease with Tidal Wave Investment Corporation, Inc. ("TWI") for a MRF in Palm
Beach County. The lease has a term of four years commencing June 1, 1999.
Payments under the lease are appropriately $20,000 per month. Messrs. Patrick F.
Marzano and Jack R. Casagrande have a minority interest in TWI. We believe that
the terms of the lease are no less favorable than would be available to an
independent third party.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth all compensation awarded to, earned by or
paid for services rendered to the Company in all capacities during the year
ended December 31, 1999 by the Company's Chief Executive Officer (the "Named
Executive Officer"). None of our other executive officers earned compensation in
excess of $100,000 during 1999.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION(1) ------------------
------------------------- SECURITIES ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS UNDERLYING OPTIONS COMPENSATION
--------------------------- ---- ------- -------- ------------------ ------------
<S> <C> <C> <C> <C> <C>
Jack R. Casagrande...................... 1999 $39,000 -- 100,000 --
Chairman and Chief Executive Officer
</TABLE>
- ---------------
(1) The Company commenced operations in February 1999.
STOCK OPTION GRANTS
The following table provides information on options granted for the fiscal
year ended December 31, 1999 and subsequent to that date to Named Executive
Officer of the Company. No options were exercised during that period.
OPTION GRANTS IN FISCAL YEAR 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF ANNUAL RATES OF STOCK
SECURITIES PRICE APPRECIATION
UNDERLYING % OF TOTAL GRANTED EXERCISE FOR OPTION TERM(3)
DATE OF OPTIONS TO EMPLOYEES IN PRICE EXPIRATION ----------------------
NAME GRANT GRANTED FISCAL YEAR ($/SHARE)(1) DATE(2) 5%($) 10%($)
---- ------- ---------- ------------------ ------------ ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Jack R. Casagrande............... 2/4/99 100,000 13.18% 0.30 2/4/04 $8,228.45 $18,315.30
</TABLE>
- ---------------
(1) Prior to June 7, 1999, there was no public market for our common stock. The
exercise price of each of these options granted prior to that date is equal
to the fair market value of our common stock on the date of grant as
determined by our board of directors.
(2) Each of the options granted has a term of five years, vesting 25% on the
first anniversary of the option grant date and 25% on each succeeding
anniversary of the grant date thereafter until fully vested.
(3) Potential realizable value is based on the assumption that the common stock
price appreciates at the annual rate shown, compounded annually, from the
date of grant until the end of the option term. The amounts have been
calculated based on the requirements promulgated by the Securities and
Exchange Commission. The actual value, if any, the Named Executive Officer
may realize will depend on the excess of the stock price over the exercise
price on the date the option is exercised, if the executive were to sell the
shares on the date of exercise, so there is no assurance that the value
realized will be equal to or near the potential realizable value as
calculated in this table.
8
<PAGE> 12
STOCK OPTION EXERCISES AND FISCAL YEAR-END VALUE TABLE
The following table sets forth certain information concerning unexercised
stock options held by our Named Executive Officer as of December 31, 1999. No
stock options were exercised by the Named Executive Officer during 1999. No
stock appreciation rights have been granted or outstanding.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
SHARES OPTIONS AT DECEMBER 31, 1999 DECEMBER 31, 1999
ACQUIRED ON VALUE ---------------------------- ----------------------------
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jack R. Casagrande... -- $ -- 25,000 75,000 $117,500(2) $352,500(2)
</TABLE>
- ---------------
(1) The closing price of the Common Stock as reported on the OTC Bulletin Board
on December 31, 1999 was $5.00.
(2) Values are calculated by multiplying (i) the difference between $5.00 and
the option exercise price of $0.30 by (ii) the number of shares of common
stock underlying the option.
9
<PAGE> 13
PERFORMANCE GRAPH
The Securities and Exchange Commission requires us to present a graph
comparing the cumulative total shareholder return on our common stock with the
cumulative total shareholder return of (i) a broad equity market index and (ii)
a published industry index or peer group. Although such a graph would normally
be for a five-year period, our common stock has been listed on the OTC Bulletin
Board only since July 7, 1999 and, as a result, the following graph reflects
only the period during which our common stock has been listed on that market.
The graph below compares our common stock with (i) the Standard & Poor's
500 Stock Index (the "S&P 500 Index") and (ii) the Standard & Poor's Waste
Management Index (the "Waste Management Index"). The total return for each of
the common stock, the S&P 500 Index and the Waste Management Index assumes the
reinvestment of dividends, although we have not declared any dividends on our
common stock. This graph assumes an initial investment of $100 on July 7, 1999
in the stocks comprising the S&P 500 Index and the stocks comprising the Waste
Management Index and an initial investment of $100 in our common stock. The
stock price performance on the following graph is historical and not necessarily
indicative of future stock price performance.
COMPARISON OF CUMULATIVE TOTAL RETURN AMONG
STAR SERVICES GROUP, INC., S&P 500 STOCK INDEX AND S&P WASTE MANAGEMENT INDEX
FROM JULY 7, 1999 TO DECEMBER 31, 1999
<TABLE>
<CAPTION>
STAR SERVICES GROUP, INC. S&P 500 S&P WASTE MANAGEMENT
------------------------- ------- --------------------
<S> <C> <C> <C>
7/7/99 100.00 100.00 100.00
9/99 97.50 93.76 42.11
12/99 100.00 107.71 36.69
</TABLE>
10
<PAGE> 14
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Company's independent public accountants for the year ended December
31, 1999 was the firm of Horton and Company LLC.
OTHER MATTERS
The Board knows of no other business to be brought before the Annual
Meeting. The Annual Report to Shareholders for the fiscal year ended December
31, 1999 is included with this Proxy Statement and is being provided to each
shareholder entitled to vote at the Annual Meeting. If any other business should
properly come before the Annual Meeting, the persons named in the accompanying
proxy will vote proxies in their discretion, unless they are directed by a proxy
to do otherwise.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the Company's 2001 Annual
Meeting of Shareholders pursuant to the provisions of Rule 14a-8 of the
Securities and Exchange Commission promulgated under the Securities Exchange Act
of 1934, as amended, must be received by the Company at its executive offices by
December 20, 2000 for inclusion in the Company's proxy statement and form of
proxy relating to such meeting.
11
<PAGE> 15
STAR SERVICES GROUP, INC.
2075 NORTH POWERLINE ROAD
POMPANO BEACH, FLORIDA 33069
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS
The undersigned holder of Common Stock of Star Services Group, Inc., a
Florida corporation (the "Company"), hereby appoints Jack R. Casagrande and
Patrick F. Marzano, and each of them, as proxies for the undersigned, each with
full power of substitution, for and in the name of the undersigned to act for
the undersigned and to vote, as designated on the reverse side of this proxy
card, all of the shares of stock of the Company that the undersigned is entitled
to vote at the Company's 2000 Annual Meeting of Shareholders, to be held on
Friday, May 12, 2000, at 9:00 a.m., local time, at the Company's corporate
headquarters at 2075 North Powerline Road, Pompano Beach, Florida 33069, and at
any adjournments or postponements thereof.
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED [X] PLEASE MARK YOUR VOTES AS
IN THIS EXAMPLE.
1. Election of Directors.
[ ] Vote for all Nominees Listed Below (except as written below)
------------------------------------------------------------------------------
[ ] Vote Withheld from all Nominees
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ELECTION OF ALL
THE DIRECTOR NOMINEES LISTED IN PROPOSAL (1).
NOMINEES:
Jack R. Casagrande, Patrick F. Marzano, Phillip Foreman, Thomas R. Roberts,
Frank P. Marzano, Rick Casagrande, Samuel G. Weiss
(Instruction: To withhold authority for an individual nominee, write that
nominee's name on the line provided below.)
------------------------------------------------------------------------------
2. In their discretion, upon such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED "FOR" THE ELECTION OF ALL DIRECTOR NOMINEES LISTED HEREIN.
PLEASE MARK, SIGN AND DATE THIS PROXY CARD AND PROMPTLY RETURN IT IN THE
ENVELOPE PROVIDED. NO POSTAGE NECESSARY IF MAILED WITHIN THE UNITED STATES.
The undersigned hereby acknowledges receipt of (i) the Notice of Annual
Meeting, (ii) the Proxy Statement, and (iii) the Company's 1999 Annual Report to
Shareholders.
----------------------------------
DATE
----------------------------------
SIGNATURE
----------------------------------
SIGNATURE (If held jointly)
Note: Please sign exactly as your
name appears hereon and mail it
promptly even though you may plan
to attend the meeting. When shares
are held by joint tenants, both
should sign. When signing as
attorney, executor, administrator,
trustee or guardian, please give
full title as such. If a
corporation, please sign in full
corporate name by president or
other authorized officer. If
partnership, please sign in the
partnership name by authorized
person.
