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:
Preliminary proxy statement
X Definitive proxy statement
Definitive additional materials
Soliciting material pursuant to Rule 14a-11(c) or
Rule 14a-12
CV REIT, INC.
___________________________________________________________________
(Name of Registrant as Specified in Its Charter)
CV REIT, INC.
___________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (check the appropriate box):
X $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1),
or 14a-6(j)(2).
$500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
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:
__________________________________________________
(4) Proposed maximum aggregate value of transaction:
__________________________________________________
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:
__________________________________________________
CV REIT, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of CV Reit, Inc.
The annual meeting of stockholders of CV Reit, Inc. will be
held in the Omni Hotel, 1601 Belvedere Rd., West Palm Beach,
Florida, on May 30, 1996, at 10:30 a.m., for the following
purposes:
1. To elect five directors;
2. To approve the appointment of BDO Seidman as
auditors of the Company for 1996; and
3. To transact such other business as may
properly be brought before the meeting.
The Board of Directors has fixed the close of business on
April 24, 1996 as the record date for the determination of
stockholders entitled to notice of and to vote at the meeting.
By Order of the Board of Directors
By ALYCE DRAKULICH
Alyce Drakulich, Secretary
April 29, 1996
If you do not expect to be present at the meeting, please date and
sign the enclosed proxy and return it promptly in the enclosed
envelope.
CV REIT, INC.
100 Century Boulevard
West Palm Beach, Florida 33417
PROXY STATEMENT
This statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of CV Reit, Inc. (the
"Company") to be voted at the annual meeting of stockholders of the
Company referred to in the foregoing Notice. Shares represented by
duly executed proxies received by the Company will be voted in
accordance with the instructions contained therein and, in the
absence of specific instructions, will be voted for the election as
directors of the persons who have been nominated by the Board of
Directors; for the reappointment of the Company's existing
auditors; and in accordance with the judgment of the person or
persons voting the proxies on any other matter that may properly be
brought before the meeting. The execution of a proxy will in no
way affect a stockholder's right to attend the Annual Meeting and
to vote in person. Any proxy executed and returned by a
stockholder may be revoked at any time thereafter either by writing
the Secretary of the Company at the above address or by attending
the Annual Meeting and revoking the proxy in person, except as to
any matter or matters upon which, prior to such revocation, a vote
shall have been cast pursuant to the authority conferred by such
proxy.
This Proxy Statement and the accompanying proxy are being sent on
or about April 29, 1996, to stockholders entitled to vote at the
Annual Meeting of Stockholders. The entire cost of soliciting
proxies hereunder will be borne by the Company and will be made
through the use of the mails. The Company will, upon request,
reimburse brokerage houses and persons holding shares in their
names or in the names of their nominees for their reasonable
expenses in sending soliciting material to their principals.
The Company has outstanding 7,966,621 shares of Common Stock which
are entitled to vote at the meeting, each share being entitled to
one vote. Only stockholders of record at the close of business on
April 24, 1996, will be entitled to vote at the meeting. There was
no other class of voting securities outstanding at that date.
PRINCIPAL STOCKHOLDERS
As of March 1, 1996, the following persons were known by the
Company to own beneficially (as defined under applicable rules of
the Securities and Exchange Commission) more than 5% of its
outstanding Common Stock:
Amount and
Nature of
Title Beneficial Percent
Name and Address of Class Ownership(1) of Class
- ---------------- ------------ ------------ --------
H. Irwin Levy............. Common Stock 801,422(2) 10.1%
100 Century Boulevard
West Palm Beach, FL 33417
Alan J. Evans and Robert
J. Cartagena, Trustees.. Common Stock 662,767(3) 8.3%
100 Century Boulevard
West Palm Beach, FL 33417
__________
(1) Unless otherwise indicated, each stockholder listed has
the sole power to vote and direct disposition of the
shares of the Company shown as beneficially owned by such
stockholder.
(2) Includes 97,293 shares owned by a corporation controlled
by Mr. Levy. Excludes 100,000 shares owned by Mr.
Levy's wife. Mr. Levy disclaims beneficial ownership of
the excluded shares.
(3) Includes 655,759 shares owned by a family trust
established by Mr. Evans's wife, of which Messrs. Evans
and Cartagena are Trustees. Also includes 5,000 shares
owned by Mr. Evans, individually, and 2,008 shares owned
by Mr. Cartagena, individually.
SECURITY OWNERSHIP OF MANAGEMENT
As of March 1, 1996, all directors and nominees, and all directors,
nominees and executive officers of the Company as a group,
beneficially owned (as defined under the applicable rules of the
Securities and Exchange Commission) shares of the Company as
follows:
Amount and
Nature of
Title Beneficial Percent
Name and Address of Class Ownership(1) of Class
- ---------------- ------------ ------------ --------
Mac Gache................. Common Stock 240,731(2) 3.0%
100 Century Boulevard
West Palm Beach, FL 33417
Allyn L. Levy............. Common Stock 20,000(3) (5)
100 Century Boulevard
West Palm Beach, FL 33417
Alvin Wilensky............ Common Stock 14,221(4) (5)
100 Century Boulevard
West Palm Beach, FL 33417
Alan L. Shulman........... Common Stock 10,680 (5)
100 Century Boulevard
West Palm Beach, FL 33417
Stanley Brenner........... Common Stock 2,500 (5)
100 Century Boulevard
West Palm Beach, FL 33417
All Directors, Nominees
and Executive Officers
as a Group (7 persons).... Common Stock 288,184 3.6%
__________
(1) See Note (1) on page 2.
(2) Owned by Mr. Gache's wife. Excludes 69,660 shares held by a
trust, with an independent trustee, of which Mr. Gache is the
income beneficiary. Mr. Gache disclaims beneficial ownership
of the shares held by the trust.
(3) Held by a revocable trust, of which Mr. Levy is the trustee and
income beneficiary.
(4) Includes 5,470 shares jointly owned with Mr. Wilensky's wife.
Excludes 3,358 shares solely owned by Mr. Wilensky's wife.
Mr. Wilensky disclaims beneficial ownership of the excluded
shares.
(5) Less than 1%.
DIRECTORS AND EXECUTIVE OFFICERS
At the meeting, five directors are to be elected to hold office
until the next annual meeting and until their respective successors
have been elected and qualified. It is the intention of the
persons named in the enclosed form of proxy to vote for the
election as directors of the persons named in the table below. All
of the persons listed below currently serve as directors and were
elected as directors by the Company's stockholders at the annual
meeting in 1995.
The following are the persons nominated to be directors of the
Company, their respective ages, the year in which each was elected
a director and, where applicable, the office of the Company held by
the director. Each director elected will hold office until the
next annual meeting of stockholders, expected to be held in April
1997, and until their respective successors have been duly elected
and qualified:
Director
Director's Name Age Since
--------------- --- --------
Stanley Brenner...................................... 70 1988
Mac Gache............................................ 91 (1)
Allyn L. Levy........................................ 68 1993
Alan L. Shulman, Chairman of the Board............... 63 1985
Alvin Wilensky, President and Chief
Executive Officer................................. 74 1981
__________
(1) Mr. Gache previously served as a director from 1968 until
February 1975 and was re-elected to the Board in 1979.
Mr. Brenner was a partner of Laventhol & Horvath, certified public
accountants, for more than five years until his retirement in 1990.
Since April 1991, Mr. Brenner has served as a consultant to the
Company principally in connection with the Company's loans to
Hilcoast Development Corp. ("Hilcoast").
Mr. Gache has been a private investor for more than five years.
Mr. Levy served as Chairman and Chief Executive Officer of Patriot
Bancorportion of Boston, Massachusetts, and its predecessor, Harbor
National Bank of Boston, from 1975 until 1986. Since 1986, Mr.
Levy has been a private investor. He is also a director of Waban,
Inc. Mr. Levy is not related to H. Irwin Levy.
Mr. Shulman was a general partner of Unitel Associates, Ltd., a
Florida limited partnership engaged in the ownership and operation
of Holiday Inn motel properties, for more than twenty years until
its dissolution in 1987. He is also a director of Island National
Bank and a private investor. A company controlled by Mr. Shulman
leases, operates and manages the Company's Days Inn Motel in West
Palm Beach, Florida.
Mr. Wilensky was Vice President-Finance of the Company for more
than five years prior to assuming his present position in July
1981.
The Board of Directors of the Company met six times during the year
ended December 31, 1995. All directors attended all meetings,
except for Mr. Levy who was absent from one meeting.
The Audit Committee, consisting of Messrs. Shulman and Brenner, met
one time during the past year. The Audit Committee is responsible
for overseeing the financial reporting process and the effectiveness of
internal controls of the Company and for recommendations to
the full Board of Directors, including the designation of
independent certified public accountants on an annual basis.
The Asset Review Committee, consisting of Messrs. Brenner, Levy and
Wilensky, met four times during the past year. The Asset Review
Committee's functions include reviewing all material loans made by
the Company to third parties and the Company's real estate
portfolio and making recommendations to management and the full
Board of Directors with respect to such matters.
The Investment Committee, consisting of Messrs. Brenner, Levy and
Shulman, did not meet during the past year. The Investment
Committee's functions include the approval of all investments of
the Company not otherwise approved by the full Board of Directors.
The Board of Directors has no standing nomination or compensation
committees or other committees performing similar functions.
The following are the executive officers of the Company, their
respective ages, the year in which each was first elected an
officer and the office of the Company held by each. Each executive
officer will hold office until the next annual meeting of the Board
of Directors or until their respective successors have been duly
elected and qualified:
Officer
Officer's Name Age Office Since
- -------------- --- ------ -------
Alvin Wilensky... 74 President and Chief Executive Officer 1981
Elaine Kahant.... 33 Vice President and Treasurer 1992
Alyce Drakulich.. 57 Secretary 1981
Ms. Kahant was employed by the Company as Controller from March
1989 until assuming her present office.
Ms. Drakulich was employed by the Company as administrative
assistant to Mr. Wilensky from March 1979 until assuming her
present office.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Executive Compensation
The following table sets forth the annual and long-term
compensation for the Company's Chief Executive Officer as well as
the total compensation paid to such individual for the Company's
two previous fiscal years. The only compensation paid by the
Company to its executive officers is base salary and annual
bonuses. The Company's Chief Executive Officer was the only
officer whose compensation exceeded $100,000 in 1995.
Summary Compensation Table
Annual Compensation
-------------------------------
Name and Principal Position Year Salary($) Bonus($)(1)
- --------------------------- ---- --------- -----------
Alvin Wilensky 1993 130,499 10,000
President and Chief 1994 136,000 5,000
Executive Officer 1995 141,500 5,000
__________
(1) Paid in March of the subsequent year.
Board Compensation Report
Since the Board does not have a Compensation Committee, the entire
Board has provided the following Compensation Report:
Executive Compensation Policy - The Board's overall compensation
philosophy is to attract and retain quality talent, which is
critical to both the short-term and long-term success of this
Company, and to create a mutuality of interest between executive
officers and stockholders through compensation structures that
share the rewards and risks of strategic decision making.
The Board annually examines market compensation levels and trends
observed in the labor market. Market information is used as a
frame of reference for annual salary adjustments and starting
salary offers. The Chief Executive Officer's salary is determined
by the Chairman of the Board who consults with the entire Board at
his discretion. Other executive salary decisions are determined in
an annual review based upon recommendations of the Chief Executive
Officer and approved by the Chairman of the Board. This annual
review considers the decision-making responsibilities of each
position and the experience, work performance, and team-building
skills of position incumbents. The Company does not have any stock
option, SAR, restricted stock or long-term incentive plans.
Base Compensation - The Board's approach to base compensation is to
offer competitive salaries in accordance with market practices
prevalent in the Company's geographical area. Increases in base
compensation of the Chief Executive Officer are based on the
Board's evaluation of the performance of the Chief Executive
Officer with respect to specific matters assigned to him by the
Board, and take into account the performance of the Company.
Bonus Compensation - The Board rewards its executive officers with
annual bonuses based on performance on specific projects or
transactions, taking into account the overall performance of the
Company. The Chief Executive Officer's input is considered when
establishing bonuses for other executive officers.
For executive officers other than the Chief Executive Officer, a
balance is made between overall corporate performance and
performance of the specific areas of the Company under a
participant's direct control. This balance supports the
accomplishment of overall objectives and rewards individual
contributions and tasks assigned to the Company employees.
Chief Executive Officer Compensation - As indicated in the
discussion above, the Company's total compensation program is
partially based upon the performance of the Company.
Mr. Wilensky has been the Company's President since 1981. During
1995, 1994 and 1993, the Company reported Funds From Operations of
$8.7 million, $8.4 million and $7.3 million, respectively. The
base salary of the Company's Chief Executive Officer (which appears
in the summary compensation table) increased four percent in 1995
and 1994 and five percent in 1993, partially as a result of the
improved performance of the Company.
Mr. Wilensky's bonuses were based on his overall contribution to
the performance of the Company.
Respectfully submitted,
Alan L. Shulman, Chairman
Alvin Wilensky
Stanley Brenner
Mac Gache
Allyn L. Levy
Board Compensation
Outside directors of the Company are paid $1,500 for attending each
Board of Directors meeting and $500 for attending each committee
meeting. Alan Shulman was elected Chairman of the Board in October
1992. Since that time, the Company has been paying Mr. Shulman,
$5,000 per month as Chairman. Stanley Brenner, one of the Company's
outside directors, is also a consultant to the Company and is
compensated for those services on an hourly basis.
Stock Performance Graph
The following graph sets forth the cumulative total shareholder
return (assuming reinvestment of dividends) to CV Reit, Inc.'s
stockholders during the five year period ended December 31, 1995,
as well as an overall stock market index (S&P 500 Index) and CV
Reit's peer group index (Mortgage REIT Industry Index):
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
Years Ended December 31,
1990 1991 1992 1993 1994 1995
------ ------ ------ ------ ------ ------
CV Reit, Inc. 100.00 168.53 309.35 431.62 469.05 658.59
S&P 500 Index 100.00 130.55 140.56 154.60 156.63 216.26
Mortgage REIT
Index 100.00 131.83 134.36 163.91 116.51 190.29
Total returns assume $100 invested on December 31, 1990 in the
Company's Common Stock, the S&P 500 Index and the Mortgage REIT
Industry Index with reinvestment of dividends.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company has no Compensation Committee. The Chief Executive
Officer's salary is determined by the Chairman of the Board who
consults with the entire Board at his discretion. Other executive
salary decisions are determined in an annual review based upon
recommendations of the Chief Executive Officer and approved by the
Chairman of the Board. During 1995, the Board consisted of Alvin
Wilensky, the Company's Chief Executive Officer and four outside
directors - Alan L. Shulman, Chairman, Stanley Brenner, Mac Gache
and Allyn L. Levy.
On November 7, 1988, the Company entered into a lease with Century
Inn Operating Corp., a company controlled by Alan L. Shulman, the
current Chairman of the Board of the Company, for the operation and
management of its Days Inn motel in West Palm Beach, Florida. The
lease, as amended, provided for annual rent through the expiration
of the lease term, on August 31, 1999, equal to a minimum of
$300,000, plus 30% of gross room revenues in excess of $1.2
million. In February 1995, the Company and the lessee agreed to
adjust the annual rent to a minimum of $330,000, plus 30% of gross
room revenues in excess of $1.3 million. In connection therewith,
the Company agreed to make certain capital improvements to the
motel, which amounted to approximately $400,000. The lease also
provides for the Company to be paid 50% of certain amounts received
by the lessee from the concessionaire who operates the food and
beverage facilities at the motel. During the year ended December
31, 1995, the Company recognized rent income of $472,000 under the
lease.
During 1995, the Company paid Mr. Shulman $5,000 per month in
connection with his services as Chairman of the Board.
TRANSACTIONS WITH OTHERS
During December 1981 and January 1982, the Company sold each of its
recreation facilities at the Century Villages in West Palm Beach,
Deerfield Beach and Boca Raton in separate transactions to
different purchasers, including H. Irwin Levy, for sales prices
based upon independent appraisals provided by Landauer Associates.
The Company sold the recreation facilities at Boca Raton to Mr.
Levy for $18 million, subject to a lease with Development, which
lease has since been acquired by a corporation owned by Mr. Levy.
(The annual net rental to Mr. Levy on that lease is $2,162,000.)
Mr. Levy paid $410,000 in cash, assumed an existing first mortgage
to an unrelated party in the principal sum of $3,415,000 (which
amount has been repaid in full), and issued 4-year and 30-year non-recourse
promissory notes to the Company in the principal amounts
of $1,640,000 and $12,535,000, respectively. The 4-year note was
non-interest bearing and has been paid in full. The 30-year note
bears interest at 13.25% per annum and, at December 31, 1995, the
outstanding balance on this note was $11.4 million. During the
year ended December 31, 1995, the Company realized $1.5 million in
interest income on this note.
Since 1990, companies owned by H. Irwin Levy and certain members of
his family have leased, managed and operated the recreation
facilities at the Century Villages in West Palm Beach, Deerfield
Beach and Boca Raton, which are collateral for certain notes held
by the Company with an outstanding balance of $43.2 million at
December 31, 1995. During 1995, the Company leased approximately
3,000 square feet of office space to those companies on a month-to-month
basis for $2,500 per month, plus an allocation of utility expenses.
Effective July 31, 1992, the Company and Hilcoast entered into a
consulting and advisory agreement under which Hilcoast provides
certain investment advisory, consulting and administrative services
to the Company, excluding matters related to Hilcoast's loans from
the Company. The agreement, which originally expired in July 31,
1994, has been extended to July 31, 1996, and provides for the
payment of $10,000 per month to Hilcoast, plus reimbursement for
all out-of-pocket expenses. The agreement may be terminated by
Hilcoast upon 180 days notice and by the Company upon 30 days
notice. Mr. Levy is a principal stockholder, Chairman of the Board
and Chief Executive Officer of Hilcoast. During 1995, the Company
leased approximately 3,800 square feet of office space to Hilcoast
on a month-to-month basis, at a monthly rental of approximately
$3,400 until July 1995 at which time Hilcoast substantially vacated
this space.
APPROVAL OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has appointed BDO Seidman as
independent auditors for the Company for the year ending December
31, 1996, subject to the approval of stockholders.
A representative of BDO Seidman is expected to be present at the
stockholders' meeting, will have the opportunity to make a
statement if he desires to do so, and will be available to respond
to appropriate questions.
STOCKHOLDERS' PROPOSALS
Proposals of stockholders to be presented at the annual meeting to
be held in 1997 must be received for inclusion in the Company's
proxy statement and form of proxy by January 1, 1997.
GENERAL
The Board of Directors does not know of any matters other than the
election of directors and the approval of the appointment of
auditors that will be presented for consideration at the meeting.
However, if other matters properly come before the meeting, it is
the intention of the persons named in the enclosed proxy to vote
thereon in accordance with their judgment. In the event that any
nominee is unable to serve as a director at the date of the
meeting, the enclosed form of proxy will be voted for any nominee
who shall be designated by the Board of Directors to fill such
vacancy.
Under Delaware law and the Company's Certificate of Incorporation
and By-Laws, if a quorum is present, directors are elected by a
plurality of the votes of the shares present in person or
represented by proxy at the meeting and entitled to vote on the
election of directors. A majority of the outstanding shares
entitled to vote, present in person or represented by proxy,
constitutes a quorum. Shares represented by proxies or ballots
withholding votes from one or more directors and any "broker non-votes",
if the broker's proxy is voted for at least one proposal,
will be counted only for purposes of determining a quorum.
Dated: West Palm Beach, Florida
April 29, 1996
C A R D
PROXY
CV REIT, INC.
The undersigned hereby appoints ALVIN WILENSKY AND ALYCE
DRAKULICH, and each of them, the attorneys and proxies of the
undersigned, with power of substitution, to vote on behalf of the
undersigned all the shares of stock of CV REIT, INC. which the
undersigned is entitled to vote at the Annual meeting of
Stockholders of CV REIT, INC. to be held in the Omni Hotel, 1601
Belvedere Road, West Palm Beach, Florida on May 30, 1996 at 10:30
a.m. and at all adjournments thereof, hereby revoking any proxy
heretofore given with respect to such stock, and the undersigned
authorizes and instructs said proxies to vote as follows:
1. Election of directors
___
/__/ FOR the election of the nominees listed below
(except as marked to the contrary below):
Stanley Brenner, Mac Gache, Allyn L. Levy,
Alan L. Shulman, Alvin Wilensky
___
/__/ WITHHOLD AUTHORITY to vote for all the nominees
listed above.
______________________________________________________________
2. Approve the appointment of BDO Seidman as auditors for the
Company for fiscal 1996.
___ ___ ___
/__/ FOR /__/ AGAINST /__/ ABSTAIN
3. In their discretion, upon such other business as may be properly
brought before the meeting.
(Please date and sign on the other side)
F R O N T
If this Proxy is properly executed and returned, the shares
represented hereby will be voted. If not otherwise specified, this
Proxy will be voted FOR the persons nominated as directors, and FOR
proposal number 2.
PLEASE DATE AND SIGN EXACTLY AS YOUR NAME OR NAMES APPEAR
BELOW.
Dated: ________________________, 1996
_____________________________________
_____________________________________
(Signature of Stockholders)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
B A C K
