Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant :
Filed by a party other than the Registrant 9
Check the appropriate box:
9 Preliminary proxy statement
: Definitive proxy statement
9 Definitive additional materials
9 Soliciting material pursuant to Rule 14a-11(c) or
Rule 14a-12
Collins Industries, Inc.
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
: $125 per Exchange Act Rule 0-11(c) (1) (ii), 14a-6(i) (1),
or 14a-6(i) (2).
9 $500 per each party to the controversy prusuant to Exchange
Act Rule 14a-6(i) (3).
9 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:
9 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: Wire transferred $125 on 1/19/99
for the filing fee to Mellon Bank, Pittsburgh, Pennsylvania,
ABA #043000261, SEC Account #9108739.
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed: January 19, 1999
COLLINS INDUSTRIES, INC.
15 Compound Drive
Hutchinson, Kansas 67502-4349
(316) 663-5551
January 21, 1999
Dear Stockholder,
You are cordially invited to attend the Annual Meeting of
Stockholders of Collins Industries, Inc. which will be held at
10:00 a.m., local time, on Friday, February 26, 1999, at the
NationsBank Auditorium, 100 North Broadway, Wichita, Kansas
67202.
We plan to review the status and future opportunities for the
Company and the industries we serve. The principal business
matters to be considered at the meeting will be the election of
two directors and the ratification of auditors for the fiscal
year ending October 31, 1999.
Attached you also will find the Notice of the Annual Meeting of
Stockholders and your proxy for the meeting. It is important that
your shares be represented at the meeting, and we hope you will
be able to attend the meeting in person. Whether or not you plan
to attend the meeting, please be sure to complete and sign the
enclosed proxy and return it to us in the envelope provided as
soon as possible so that your shares may be voted in accordance
with your wishes. Your prompt response will save the Company the
cost of further solicitation of unreturned proxies.
We look forward to seeing you on February 26.
Sincerely yours,
Don L. Collins
Chairman of the Board
COLLINS INDUSTRIES, INC.
15 Compound Drive
Hutchinson, Kansas 67502
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On February 26, 1999
NOTICE IS HEREBY GIVEN THAT the annual meeting of Stockholders
(the "Annual Meeting") of Collins Industries, Inc. a Missouri
corporation (the "Company"), will be held at the NationsBank
Auditorium, 100 North Broadway, Wichita, Kansas, on Friday,
February 26, 1999, at 10:00 a.m., local time, for the purpose of
considering and voting upon the following matters:
1. The election of two directors to serve their respective
terms and until their successors shall be elected and shall
qualify;
2. Ratification of the appointment of Arthur Andersen LLP,
as independent public accountants for the Company for the
fiscal year ending October 31, 1999; and
3. The transaction of such other business as may properly
come before the meeting and any adjournments thereof.
All of the above matters are more fully described in the
accompanying Proxy Statement, into which this notice is
incorporated by reference.
The Board of Directors has fixed the close of business on
December 31, 1998, as the date of record for determining
stockholders entitled to receive notice of and to vote at the
Annual Meeting and any adjournments thereof. The stock transfer
books of the Company will remain open between the record date and
the date of the meeting.
IN ORDER THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING,
PLEASE FILL OUT, DATE, SIGN AND RETURN THE ENCLOSED PROXY
PROMPTLY OR PLAN TO ATTEND THE ANNUAL MEETING IN PERSON. A
RETURN-ADDRESSED ENVELOPE, WHICH REQUIRES NO POSTAGE, IS ENCLOSED. IF
YOU LATER DESIRE TO REVOKE OR CHANGE YOUR PROXY FOR ANY REASON,
YOU MAY DO SO AT ANY TIME BEFORE THE VOTING, BY DELIVERING TO THE
COMPANY A WRITTEN NOTICE OF REVOCATION OR A DULY EXECUTED PROXY
BEARING A LATER DATE OR BY ATTENDING THE ANNUAL MEETING AND
VOTING IN PERSON.
By order of the Board of Directors
Dated: January 21, 1999
Lewis W. Ediger
Secretary
COLLINS INDUSTRIES, INC.
15 Compound Drive
Hutchinson, Kansas 67502
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To be held on February 26, 1999
GENERAL INFORMATION
INTRODUCTION. This Proxy Statement is furnished in connection
with the solicitation by and on behalf of the Board of Directors
of Collins Industries, Inc. ("the Company") of proxies for use at
the annual meeting of Stockholders to be held on Friday, February
26, 1999 at 10:00 a.m., local time, at the NationsBank Auditorium,
100 North Broadway, Wichita, Kansas 67202 and at any
adjournment thereof (the "Annual Meeting"), and, together with
the enclosed Form of Proxy and Annual Report to Stockholders for
the fiscal year ended October 31, 1998 (the "Annual Report"), is
being mailed to the Stockholders on or about January 21, 1999.
The address of the principal executive offices of the Company is
15 Compound Drive, Hutchinson, Kansas 67502. Except for items
specifically incorporated by reference herein, the Annual Report
does not form any part of this Proxy Statement.
REVOCABILITY OF PROXIES. Each proxy that is properly executed and
returned in time for use at the Annual Meeting will be voted at
the Annual Meeting, and any adjournments thereof, in accordance
with the choices specified. Any proxy given pursuant to this
solicitation may be revoked by the person giving it at any time
before the voting by delivering to the Company a written notice
of revocation or a duly executed proxy bearing a later date or by
attending the Annual Meeting and voting in person.
COST OF SOLICITATION. The entire cost of solicitation of proxies
will be borne by the Company. Solicitation will be made by mail.
Additional solicitation may be made by officers and employees of
the Company by means of a follow-up letter, personal interview,
telephone or telegram. Such persons will receive no additional
compensation for such services. Proxy cards and materials also
will be distributed to beneficial owners through brokers,
custodians, nominees and similar parties, and the Company intends
to reimburse such parties for reasonable expenses incurred by
them in connection with such distribution.
QUORUM AND VOTING. The authorized capital stock of the Company
consists of 17,000,000 shares of Common Stock, $. 10 par value
per share (the "Common Stock") and 3,000,000 shares of Capital
Stock, other than Common Stock, $ .10 par value per share (the
"Capital Stock"). As of the close of business on December 31,
1998 (the "Record Date"), there were 7,406,481 shares of Common
Stock outstanding and no shares of Capital Stock outstanding. All
of the issued and outstanding shares of Common Stock of record as
of the Record Date are entitled to vote at the Annual Meeting.
Only stockholders of record of the 7,406,481 shares of Common
Stock, outstanding as of the Record Date, will be entitled to
vote. Each share of Common Stock is entitled to one vote on all
matters, except in the election of directors where the
stockholders have cumulative voting rights as described under
"Election of Directors." The presence, in person or by proxy, of
the holders of record of a majority of the outstanding shares of
Common Stock entitled to vote is necessary to constitute a quorum
at the Annual Meeting. Abstentions and broker non-votes are
tabulated as if no votes were cast for the matters indicated.
MATTERS TO BE ACTED UPON AT THE MEETING
As indicated in the Notice of Annual Meeting of Stockholders, at
the Annual Meeting, two directors will be elected, and the
Stockholders will be asked to ratify the appointment of auditors
for the fiscal year ending October 31, 1999.
Proposal 1:
ELECTION OF DIRECTORS
The Board of Directors is presently comprised of seven directors
serving staggered three-year terms. In August 1998, the Board of
Directors increased the number of directors serving on the Board
of Directors from six to seven and elected a Director whose term
will expire in 2001.
Each Stockholder has cumulative voting rights in electing
directors, which means the number of shares owned may be
multiplied by the number of directors to be elected and the
cumulative total voted for one (1) candidate or otherwise
distributed among any number of candidates. Cumulative voting
rights may be exercised in the same manner as other voting
rights; that is, by proxy or in person. The two (2) candidates
receiving the highest number of votes shall be elected. The two
(2) persons named in the enclosed proxy, or their substitutes,
will vote signed and returned proxies for the nominees listed
below and, unless otherwise indicated on the proxy, cumulative
votes will be divided equally between the nominees. The proxies
cannot be voted for a greater number of persons than the number
of nominees named below. Each of the nominees has been designated
as such by the Board of Directors for the terms specified by
their names, and has agreed to serve if elected. Each of the
nominees is currently serving as a director, and information
about each nominee is set forth under "Management."
The Board of Directors has no reason to believe that the nominee
will become unavailable for election. However, if for any reason,
the nominee is not available for election, another person or
persons may be nominated by the Board of Directors and voted for
in the discretion of the persons named in the enclosed proxy.
Vacancies on the Board of Directors occurring after the election
will be filled by Board appointment to serve until the next
election of such position by the Stockholders.
THE BOARD OF DIRECTORS RECOMMENDS ELECTION OF THE NOMINEE
Don L. Collins 3-year term
Don S. Peters 3-year term
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of December 31,
1998, with respect to (i) each person who is known by the Company
to own beneficially in excess of 5% of the outstanding Common
Stock, (ii) each director of the Company, (iii) each named
executive officer and (iv) all directors and executive officers
of the Company as a group. Each person listed below exercises
sole voting power and sole investment power unless otherwise
indicated by footnote. As of December 31, 1998, there were
7,406,481 shares of Common Stock of the Company issued and
outstanding.
Shares
Beneficially Percentage
Name and Address Owned Owned
Collins Industries Tax Deferred 433,839(1) 5.86%
Savings Plan and Trust
c/o Bank of Kansas, Trustee
P.O. Box 1707
Hutchinson, KS 67504-1707
Don L. Collins 1,223,271(2) 16.18%
157 East New England Avenue,
Suite 364
Winter Park, FL 32789
Donald Lynn Collins 498,097(3) 6.56%
15 Compound Drive
Hutchinson, KS 67502
Lewis W. Ediger 341,461(4) 4.58%
15 Compound Drive
Hutchinson, KS 67502
Arch G. Gothard, III 198,125(5) 2.66%
15 Compound Drive
Hutchinson, KS 67502
Robert E. Lind 178,471(6) 2.40%
15 Compound Drive
Hutchinson, KS 67502
Don S. Peters 137,750(7) 1.83%
15 Compound Drive
Hutchinson, KS 67502
William R. Patterson 10,000 *
15 Compound Drive
Hutchinson, KS 67502
Terry L. Clark 58,700(8) *
15 Compound Drive
Hutchinson, KS 67502
Larry W. Sayre 55,000(9) *
15 Compound Drive
Hutchinson, KS 67502
All executive officers and 2,827,247(10) 34.92%
directors as a group
(12 persons)
* Less than 1%.
(1) As of December 31, 1998, based on information received from
the trustee of the Plan.
(2) Does not include 7,559 shares owned by Sharon Collins, the
wife of Mr. Collins, as to which Mr. Collins disclaims beneficial
ownership. Includes (i) 155,800 shares deemed beneficially owned
pursuant to options exercisable within 60 days and (ii) 64,922
shares owned by Collins Capital Corporation, of which Mr. Collins
is an officer, for which Mr. Collins shares voting and investment
power.
(3) Includes (i) 182,600 shares deemed beneficially owned
pursuant to options exercisable within 60 days and (ii) 64,922
shares owned by Collins Capital Corporation, of which Mr. Collins
is an officer, for which Mr. Collins shares voting and investment
power.
(4) Includes 50,000 shares deemed beneficially owned pursuant to
options exercisable within 60 days. Also includes 14,128 shares
for which Mr. Ediger shares voting and investment power.
(5) Includes 55,000 shares deemed beneficially owned pursuant to
options exercisable within 60 days. Mr. Gothard has shared
investment power with respect to 13,650 shares.
(6) Includes 35,000 shares deemed beneficially owned pursuant to
options exercisable within 60 days.
(7) Includes 119,000 shares deemed beneficially owned pursuant
to options exercisable within 60 days. Mr. Peters has shared
investment power with respect to 52,250 shares.
(8) Includes 30,800 shares deemed beneficially owned pursuant to
options exercisable within 60 days.
(9) Includes 25,000 shares deemed beneficially owned pursuant to
options exercisable within 60 days.
(10) Includes 690,300 shares deemed beneficially owned pursuant
to options exercisable within 60 days.
MANAGEMENT
Directors and Executive Officers
The following table sets forth certain information with
respect to the directors and executive offices of the Company.
Name Age Position Within The Company
Don L. Collins (1) 67 Chairman, Director
Donald Lynn Collins (3) 46 President, Chief Executive Officer,
Director
Lewis W. Ediger (2) 67 Secretary, Vice-President, Director
Robert E. Lind (3) 74 Director
Don S. Peters (1) 69 Director
Arch G. Gothard, II (2) 53 Director
William R. Patterson(3) 57 Director
Terry L. Clark 47 Executive Vice-President Operations
Larry W. Sayre 50 Vice-President Finance and
Chief Financial Officer
Rodney T. Nash 53 Vice-President Engineering
Jack W.Cowden 51 Vice-President Human Resources
Kent E. Tyler 32 Vice-President Marketing
(1) Term as director expries in 1999.
(2) Term as director expires in 2000.
(3) Term as director expires in 2001.
Don L. Collins, founder of the Company, has served as
Chairman of the Board since its inception in 1971 and served as
Chief Executive Officer until 1998. He is Chairman of the
Board's Executive Committee.
Donald Lynn Collins joined the Company in 1980 after being
associated with Arthur Andersen & Company, an international
accounting firm. Mr. Collins has served as Chief Executive
Officer of the Company since 1998 and as President since 1990.
He served as the Chief Operating Officer from 1988 until 1998.
He is a member of the Board's Policy Committee, Nominating
Committee, Executive Committee, Compensation Committee, Finance
Committee and Audit Committee. He is the son of Don L. Collins.
Lewis W. Ediger, a director and Vice-President of the
Company since 1972, and Secretary since 1991, is a member of the
Board's Policy Committee and Executive Committee and is chairman
of the Nominating Committee.
Robert E. Lind, a director of the Company since 1972, was
employed by the Company as its purchasing manager from 1972 until
his retirement in 1980. He is a member of the Board's
Compensation Committee.
Don S. Peters, a director of the Company since 1983, founded
and was chairman of Peters, Gamm, West and Vincent, Inc. an
investment advisory firm in Wichita, Kansas, from 1983 to
December 1991. He has been a financial consultant with Central
Plains Advisors, Inc. since December 1991. He is a member of the
Board's Audit Committee and is chairman of the Board's
Compensation and Policy Committees.
Arch G. Gothard, III, a director of the Company since 1987,
has been president of First Kansas Group, an investment firm in
Junction City, Kansas, since January 1988. He was chief financial
officer, treasurer and director of Communications Services, Inc.
from 1985 to 1989. He is a member of the Board's Nominating
Committee and is chairman of the Board's Audit Committee and
Finance Committee. Mr. Gothard also serves as a director of
Golden Pharmaceuticals, Inc.
William R. Patterson became a director in 1998. Since August
1998 he has been a principal at Stonecreek Management, LLC. From
October 1996 to August 1998, he was Executive Vice President of
Premium Standard Forms, Inc., where he served as a consultant and
as acting Chief Financial Officer from January 1996 to October
1996. From September 1976 through December 1995 he was a partner
in Arthur Andersen LLP. Mr. Patterson also serves as a director
of American Italian Pasta Company and Paul Meuller Company.
Terry L. Clark joined the Company in July 1993 as President
of Mobile-Tech Corporation and was promoted to Vice-President
Operations of the Company in July, 1994, and to Executive Vice-
President Operations of the Company in November 1996. Mr. Clark
was President of Quest Communications, Inc. from February 1990 to
March 1992 and was Chief Financial Officer and Chief Operating
Officer of Ascom Autelca, Inc. from November 1988 to February
1990, two companies serving the telecommunications industry.
Larry W. Sayre joined the Company in August 1993 as Vice-
President Finance and Chief Financial Officer. He has served as
Treasurer of the Company since 1995. Mr. Sayre is a certified
public accountant and previously served in the consulting
division of Grant Thornton, a national accounting firm.
Rodney T. Nash joined the Company in 1979 as Engineering
Manager and was named Vice-President Engineering of the Company
in November 1986. Prior to joining the Company, he held
engineering positions with Hesston Corporation and Butler
Manufacturing.
Jack W. Cowden joined the Company in 1989 and was named Vice-
President, Human Resources in February 1990. Mr. Cowden has over
20 years Human Resources experience. Prior to joining the
Company, he was director of employee relations with a division of
Emerson Electric and Cessna Aircraft, respectively.
Kent E. Tyler joined the Company in December 1997 as Vice-
President Marketing. Prior to joining the Company, he was Vice-
President of Ackerman McQueen, a full-service national marketing
and advertising agency.
All executive officers serve at the discretion of the Board of
Directors.
Settlement of Securities and Exchange Commission Investigation
On November 3, 1994, the Securities and Exchange Commission
(the "Commission") instituted public administrative proceedings
against the Company, Donald Lynn Collins and other
representatives of the Company, pursuant to Section 21C of the
Securities Exchange Act of 1934 (the "Exchange Act") and Section
8A of the Securities Act of 1933 (the "Securities Act")
concerning alleged violations of the anti-fraud, record-keeping
and internal controls provisions of the Exchange Act and the
Securities Act. Simultaneously with the institution of the
proceedings, the Commission accepted an offer of settlement from
each respondent in which, without admitting or denying the
findings of the Commission, each respondent agreed to the
issuance of an order directing the respondent to cease and desist
from committing and/or causing violations of certain provisions
of the Exchange Act and, as to the Company and Donald Lynn
Collins, the Securities Act.
Section 16(a) - Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires executive
officers and directors of the Company, and persons who
beneficially own more than ten percent (10%) of the Common Stock
(collectively referred to herein as "Reporting Persons"), to file
initial reports of ownership and reports of changes in ownership
with the Commission. Reporting Persons are required by Commission
regulations to furnish the Company with copies of all Section
16(a) forms they file.
Based solely upon a review of copies of Forms 3, 4 and 5 and
amendments thereto furnished to the Company during its most
recent fiscal year, the Company believes that all of these forms
required to be filed by Reporting Persons were timely filed
pursuant to Section 16(a) of the Exchange Act.
COMMITTEES OF THE BOARD
The Board of Directors has established standing Audit,
Compensation and Nominating Committees. The principal
responsibilities of each such committee are described below. The
members of each such committee are identified in the director
biographies set forth under "Management."
The Audit Committee, consisting of two non-employee
directors and one employee director, met once during Fiscal 1998.
Each year it recommends the appointment of a firm of independent
public accountants to examine the accounting records of the
Company and its subsidiaries for the coming year. In making this
recommendation, it reviews the nature of both audit-related and
non-audit-related services rendered or to be rendered to the
Company and its subsidiaries by the independent public
accountants. The Audit Committee meets with representatives of
the Company's independent public accountants and reviews with
them audit scope, procedures and results, including any problems
identified by the independent public accountants regarding
internal accounting controls, and their recommendations. It also
meets with the Company's chief financial officer to review
reports on the functioning of financial controls and internal
auditing and assesses internal controls within the Company and
its subsidiaries based upon the activities of the internal
auditing staff. The Audit Committee evaluates the performance of
that staff. The Audit Committee also is prepared to meet with the
Company's independent public accountants or chief financial
officer at their request to review any special situation arising
in relation to any of the foregoing subjects.
The Compensation Committee, consisting of two non-employee
directors and one employee director, met once during Fiscal 1998.
The Compensation Committee establishes the compensation policies
of the Company and makes salary recommendations to the Board of
Directors for all elected officers. It also recommends bonuses
for officers and other senior executives.
The Nominating Committee, consisting of three directors, met
twice during Fiscal 1998. It recommends to the Board of Directors
nominees for director to be proposed for election by the
stockholders and also reviews the qualifications of, and
recommends to the Board of Directors, candidates to fill Board
of Director vacancies as they may occur during the year. The
Nominating Committee considers suggestions from many sources,
including stockholders, regarding possible candidates for
director. Such suggestions, together with appropriate biographical
information, should be submitted to the Secretary of the Company
for consideration by the Nominating Committee by October 31, 1999
for the next annual stockholders meeting. Guidelines regarding
the qualifications of candidates for directors, insofar as they
apply to non-employees, generally favor individuals who have
managed relatively large, complex business, educational, or
other organizations or who, in a professional or business'
capacity, are accustomed to dealing with complex business or
financial problems.
Actions taken by any committee of the Board of Directors are
reported to the Board of Directors, usually at its next meeting.
There were twelve Board of Directors meetings during Fiscal 1998.
In Fiscal 1998, each director attended more than 75% of (i) the
total number of meetings of the Board of Directors and (ii) the
total number of meetings held by all committees of the Board on
which he served.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding
compensation paid during each of the Company's last three fiscal
years to the Company's Chief Executive Officer and the other
named executive officers.
ANNUAL COMPENSATION
Name and Other Annual
Principle Position Year Salary($) Bonus($) Compensation($)
(a) (b) (c) (d) (e)
Don L. Collins 1998 360,000 140,000 --
Chairman 1997 357,702 91,786 --
1996 328,579 215,792 93,750(1)
Donald Lynn Collins 1998 295,000 180,000 --
President, Chief 1997 285,170 84,028 355,976(2)
Executive Officer 1996 243,867 320,139 230,114(1)(2)
Lewis W. Ediger 1998 128,700 26,200 --
Vice President, 1997 132,096 25,975 --
Secretary 1996 122,190 10,000 --
Terry L. Clark 1998 160,000 75,000 --
Executive Vice 1997 155,417 40,655 --
President, Operations 1996 124,255 10,000 --
Larry W. Sayre 1998 135,000 50,000 --
Vice President 1997 129,539 23,467 --
Finance & CFO 1996 108,842 8,000 --
SUMMARY COMPENSATION TABLE - (CON'T)
LONG TERM COMPENSATIONS
Awards Payouts
Securities
Restricted Underlying All Other
Name and Stock Options/ LTIP Compensation
Principle Position Year Awards($) SARs(#) Payouts ($)
(a) (b) (f) (g) (h) (i)
Don L. Collins 1998 $ -- 25,000 -- --
Chairman 1997 -- 173,000 -- --
1996 -- 162,000 -- --
Donald Lynn Collins 1998 -- 50,000 -- --
President, Chief 1997 -- 182,600 -- --
Executive Officer 1996 -- 216,000 -- --
Lewis W. Ediger 1998 -- 5,000 -- --
Vice President, 1997 -- 54,600 -- --
Secretary 1996 -- 90,000 -- --
Terry L. Clark 1998 -- 25,000 -- --
Executive Vice 1997 -- 48,000 -- --
President, Operations 1996 -- 18,000 -- --
Larry W. Sayre 1998 -- 15,000 -- --
Vice President 1997 -- 28,500 -- --
Finance & CFO 1996 -- 33,000 -- --
(1) Reimbursement of taxes paid on bonus.
(2) Don L. Collins and Donald Lynn Collins were granted
restricted stock awards as of January 20, 1995 in the amounts of
25,000 and 75,000 shares, respectively. In fiscal 1996, the
company rescinded (i) all of Don L. Collins' restricted stock
award and granted him a cash bonus of $140,625 plus a payment of
$93,750 for reimbursement of taxes and (ii) 50,000 shares of
Donald Lynn Collins' restricted stock award and granted him a
cash bonus of $281,250 plus a payment of $230,114 for
reimbursement of taxes. In fiscal 1997, the Company removed the
restriction on the remaining 25,000 shares of Donald Lynn
Collins' restricted stock previously awarded in 1995. The market
value of these shares was $190,625 on the date the restriction
was removed and the Company granted a bonus of $165,351 for
reimbursement of taxes. The cash bonuses and tax reimbursements
are included in the Summary Compensation Table.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Individual Grants
Number of Percent of
securities total options/
underlying SARs granted Exercise of
Options/SARs to employees base price
Name granted(1) in fiscal year ($/Sh)
(a) (b) (c) (d)
Don L. Collins 25,000(2) - $7.0000
Don L. Collins 25,000(2) - $6.1250
Don L. Collins 25,000 13.7% $4.2500
Donald Lynn Collins 50,000(2) - $7.0000
Donald Lynn Collins 50,000(2) - $6.1250
Donald Lynn Collins 50,000 27.4% $4.2500
Lewis W. Ediger 5,000(2) - $7.0000
Lewis W. Ediger 5,000(2) - $6.1250
Lewis W. Ediger 5,000 2.7% $4.2500
Terry L. Clark 25,000(2) - $7.0000
Terry L. Clark 25,000(2) - $6.1250
Terry L. Clark 25,000 13.7% $4.2500
Larry W. Sayre 15,000(2) - $7.0000
Larry W. Sayre 15,000(2) - $6.1250
Larry W. Sayre 15,000 8.2% $4.2500
OPTION/SAR GRANTS IN LAST FISCAL YEAR - (CON'T.)
Potential realizable value at assumed annual
rates of stock price appreciation for option term
Name Expiration Date 5%($) 10%(%)
(a) (e) (f) (g)
Don L. Collins 11/25/07 $110,056 $278,905
Don L. Collins 02/27/08 $ 96,299 $244,042
Don L. Collins 09/22/08 $ 66,820 $169,335
Donald Lynn Collins 11/25/07 $220,112 $557,810
Donald Lynn Collins 02/27/08 $192,598 $488,084
Donald Lynn Collins 09/22/08 $133,640 $338,670
Lewis W. Ediger 11/25/07 $ 22,011 $ 55,781
Lewis W. Ediger 02/27/08 $ 19,260 $ 48,808
Lewis W. Ediger 09/22/08 $ 13,364 $ 33,867
Terry L. Clark 11/25/07 $110,056 $278,905
Terry L. Clark 02/27/08 $ 96,299 $244,042
Terry L. Clark 09/22/08 $ 66,820 $169,335
Larry W. Sayre 11/25/07 $ 66,033 $167,343
Larry W. Sayre 02/27/08 $ 57,780 $146,425
Larry W. Sayre 09/22/08 $ 40,092 $101,601
(1) Each stock option is exercisable six (6) months after the
date of grant.
(2) Represents options granted, cancelled and subsequently
reissued.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table provides information related to options
exercised by the named executive officer during the 1998 fiscal
year and the number and value of options held at fiscal year end.
The Company does not have any outstanding stock appreciation
rights.
Shares Acquired Value
Name on Exercise (#) Realized ($)
(a) (b) (c)
Don L. Collins 149,200 $720,277
Donald Lynn Collins - -
Lewis W. Ediger 69,600 $363,900
Terry L. Clark 20,200 $ 52,075
Larry W. Sayre 23,500 $113,312
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES - (CON'T)
Number of Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
FY-End (#) at FY-End ($)
Exercisable/ Exercisable/
Name Unexercisable Unexercisable
(a) (d) (e)
Don L. Collins 155,800/25,000 0/0
Donald Lynn Collins 207,600/50,000 0/0
Lewis W. Ediger 50,000/ 5,000 0/0
Terry L. Clark 30,800/25,000 0/0
Larry W. Sayre 25,000/15,000 0/0
Ten-Year Option/SAR Repricings
Number of
Securities Market Price
Underlying of Stock at
Options/SARs Time of
Repriced or Repricing or
Title/Name Date Amended (#) Amendment ($)
Chairman of the Board
Collins, Don L. Sr. 02/27/98 25,000 $6.125
Collins, Don L. Sr 09/22/98 25,000 $4.250
President and Chief
Executive Officer
Collins, Donald Lynn, Jr. 02/27/98 50,000 $6.125
Collins, Donald Lynn, Jr. 09/22/98 50,000 $4.250
Executive Vice
President, Operations
Clark, Terry L. 02/27/98 25,000 $6.125
Clark, Terry L. 09/22/98 25,000 $4.250
Vice President and
Secretary
Ediger, Lewis W. 02/27/98 5,000 $6.125
Ediger, Lewis, W. 09/22/98 5,000 $4.250
Vice President,
Finance & CFO
Sayre, Larry W. 02/27/98 15,000 $6.125
Sayre, Larry W. 09/22/98 15,000 $4.250
Ten-Year Option/SAR Repricings - (Con't)
Length of
Original
Exercise Price Option Terms
of Stock at Remaining at
Time of New Date of
Repricing or Exercise Repricing or
Title/Name Date Amendment Price ($) Amendment
Chairman of the Board
Collins, Don L. Sr. 02/27/98 $7.000 $6.125 9 yrs. 9 mos.
Collins, Don L. Sr. 09/22/98 $6.125 $4.250 9 yrs. 5 mos.
President and Chief
Executive Officer
Collins, Donald Lynn, Jr. 02/27/98 $7.000 $6.125 9 yrs. 9 mos.
Collins, Donald Lynn, Jr. 09/22/98 $6.125 $4.250 9 yrs. 5 mos.
Executive Vice
President, Operations
Clark, Terry L. 02/27/98 $7.000 $6.125 9 yrs. 9 mos.
Clark, Terry L. 09/22/98 $6.125 $4.250 9 yrs. 5 mos.
Vice President and
Secretary
Ediger, Lewis W. 02/27/98 $7.000 $6.125 9 yrs. 9 mos.
Ediger, Lewis W. 09/22/98 $6.125 $4.250 9 yrs. 5 mos.
Vice President,
Finance & CFO
Sayre, Larry W. 02/27/98 $7.000 $6.125 9 yrs. 9 mos.
Sayre, Larry W. 09/22/98 $6.125 $4.250 9 yrs. 5 mos.
Directors' Compensation
During Fiscal 1998, the Company paid each employee director $850
for each Board of Directors meeting attended, which amounts are
included in the Summary Compensation Table. Outside directors
received $1,300 for each Board of Directors meeting attended and
$850 for each Board of Directors committee meeting attended. In
addition, Mr. Peters and Mr. Gothard each received Board of
Directors retainer fees of $1,400 per month, and Mr. Lind received
a Board of Directors retainer fee of $450 per month. Committee
fees are not paid (i) to inside directors and (ii) to outside
directors when such committee meetings are held on the same day as
a Board of Directors meeting or in conjunction with a General
Managers meeting.
Report of the Compensation Committee on Executive Compensation
The Company applies a consistent philosophy to compensation for
all employees, including senior management. This philosophy is
based on the premise that the achievements of the Company result
from the coordinated efforts of individuals working toward common
objectives. The Company strives to achieve those objectives
through teamwork that is focused on meeting the expectations of
customers, stockholders and employees.
Executive Compensation Philosophy. The Compensation Committee of
the Board of Directors makes compensation recommendations to the
Board of Directors and is composed of three directors, two of whom
are independent. Donald Lynn Collins serves on the Compensation
Committee but abstains from decisions regarding his own
compensation and the compensation of Don L. Collins. The goals of
the Compensation Committee are to align compensation with business
objectives and performance, and to enable the Company to attract,
retain and reward executive officers who contribute to the long-
term success of the Company. The Compensation Committee considers
several factors in establishing the executive compensation program
of the Company, including both subjective and objective factors.
Although profitability of the Company and market value of its
Common Stock are considered in establishing the executive
compensation program, neither of these factors are determinative.
Rather, the Company's executive compensation program is based on
the following principles:
The Company attempts to compensate competitively.
The Company is committed to providing a compensation program aimed
at attracting and retaining highly qualified people, primarily
from within the industry. To ensure that compensation is
competitive, the Company periodically compares its compensation
practices with those of competitors and other companies and sets
its compensation parameters based on this review.
The Company compensates sustained performance.
Executive officers are rewarded based upon corporate performance
and individual performance. Corporate performance is not
determined strictly on the basis of designated criteria, but is
evaluated on the basis of many factors including but not limited
to earnings, revenues, product innovation, market share, strategic
and business plan goals, the extent to which strategic and
business plan goals are met and current industry conditions.
Individual performance is evaluated by reviewing the executive
officer's individual performance as well as, the performance of
that officer's functional area of responsibility.
The Company strives for fairness in the administration of
compensation.
The Company attempts to apply its compensation philosophy
uniformly. The Company strives to achieve a balance of the
compensation paid to a particular individual and the compensation
paid to other executives both inside the Company and at competing
companies.
The Company's process of assessing executive performance is as
follows:
1. At the beginning of the annual performance cycle, objectives
and key goals are set for the Company's executives.
2. Each executive is given ongoing feedback on performance.
3. At the end of the annual performance cycle, the Chief
Executive Officer and the Compensation Committee evaluate each
executive's accomplishment of objectives and attainment of key
goals.
4. The accomplishment of objectives and attainment of key goals
affect decisions on salary increases and, if applicable, stock
options.
Executive Compensation Vehicles. The Company utilizes the three
components of its compensation program to attract and retain key
executives, enabling it to improve its products, motivate
technological innovation, foster teamwork and adequately reward
executives, all with the goal of enhancing stockholder value. The
annual cash-based compensation for executives consists of a base
salary which reflects the respective executive's level of
responsibility, breadth of knowledge and technical or
professional skills and is subject to increases or decreases at
the discretion of the Compensation Committee. Salaries are
reviewed on an annual basis and may be changed at that time based
on (i) information derived from the evaluation procedures
described above, (ii) a determination that an individual's
contributions to the Company have increased (or decreased), and
(iii) changes in market conditions and competitive compensation
levels.
From time to time the Company awards bonuses to executive
officers upon attainment of certain Company financial and
operational goals. These bonuses are set forth in the
Compensation Table. From time to time the Company also makes
available to directors and executive officers incentive bonuses
pursuant to the Company's unwritten Executive Incentive
Compensation Plan (the "Incentive Compensation Plan"). Under the
Incentive Compensation Plan, the Company may award cash and/or
restricted Common Stock to directors and executive officers of
the Company. The Incentive Compensation Plan is administered by
the Compensation Committee of the Board of Directors and is a
discretionary plan based upon performance by the individual and
the Company.
Long-term incentives are intended to be provided through the
Company's 1997 Omnibus Incentive Plan which provides for granting
(i) Stock Options, Restricted Stock Awards, Performance Shares,
and/or Other Incentive Awards to employees of the Corporation and
its Subsidiaries on the terms and subject to the conditions set
forth in the Plan, and (ii) Director Options and Director Awards
to Non-Employee Directors of the Company as approved by the
Board. The Compensation Committee determines which executives
will be eligible for incentives with the objective of aligning
executives' long range interests with those of the stockholders
by providing the executives with the opportunity to build a
meaningful interest in the Company.
Compensation of the Chief Executive Officer. As with the other
executive officers, the CEO's total compensation is based upon
several factors, including both subjective and objective factors.
For Fiscal 1998, the Compensation Committee compared the CEO's
annual salary with the annual salaries of chief executive
officers of competitors and other peer groups, pursuant to
several published national studies (the "Studies"). The
Compensation Committee authorized a 6.78% merit increase in the
CEO's annual salary and determined the CEO's annual salary to be
reasonable and appropriate in light of the comparison to the
Studies. It is the policy of the Compensation Committee to
authorize a bonus for the CEO upon the attainment of certain
Company financial and operational goals. These bonuses are
described above and set forth on the Compensation Table.
Compensation Committee Report on Repricing of Options. On
November 25, 1997, the Board of Directors granted stock options
to the Company's executive officers (the "November Options"). On
February 27, 1998, the Compensation Committee (i) analyzed the
difference between the exercise prices of the November Options
versus the then-current market price of the Company's Common
Stock and (ii) determined that, because of such price differential,
the November Options were not providing the desired incentive for
the performance of the executive officers. Pursuant to this
determination, the Board of Directors canceled all of the November
Options and exchanged them for an equivalent number of options with
an exercise price equal to the market price of the Company's Common
Stock as of February 27, 1998 (the "February Options").
On September 22, 1998, the Compensation Committee (i) analyzed
the difference between the exercise prices of the February
Options versus the then-current market price of the Company's
Common Stock and (ii) determined that, because of such price
differential, the February Options were not providing the desired
incentive for the performance of the executive officers. Pursuant
to this determination, the Board of Directors canceled all of the
February Options and exchanged them for an equivalent number of
options with an exercise price equal to the market price of the
Company's Common Stock as of September 22, 1998.
Compensation Committee Members: Don S. Peters
Donald Lynn Collins
Robert E. Lind
Compensation Committee Interlocks and Insider Participation
During Fiscal 1998, the members of the Compensation Committee
were primarily responsible for determining executive
compensation. Messrs. Donald Lynn Collins, Robert E. Lind and Don
S. Peters comprised the Compensation Committee. Mr. Collins is
currently the President and Chief Executive Officer of the
Company. Mr. Lind was employed by the Company as its purchasing
manager from 1972 until his retirement in 1980.
STOCK PERFORMANCE
The following chart shows a five-year comparison of cumulative
total stockholder returns for the Company's Common Stock during
the five (5) fiscal years ended October 31, 1998 with the NASDAQ
U.S. Index and an index of peer groups selected by the Company.
The companies in the peer group are Champion Industries, Federal
Signal, Thor Industries, Spartan Motors and Metro Trans. The
comparison assumes an investment of $100 on October 31, 1993 in
each index and the Company's Common Stock and that all dividends
were reinvested.
Base
Year
1993 1994 1995 1996 1997 1998
Collins $100.0 $120.0 $110.0 $306.7 $373.3 $203.3
Peer Group $100.0 $121.7 $109.1 $143.1 $142.8 $112.9
NASDAQ-US $100.0 $100.6 $135.4 $159.8 $210.3 $235.8
PROPOSAL 2:
RATIFICATION BY STOCKHOLDERS OF APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected the firm of Arthur Andersen
LLP, independent certified public accountants, to be the Company's
auditors for the fiscal year ending October 31, 1999.
Representatives of Arthur Andersen LLP, are expected to be present
at the Annual Meeting and shall have the opportunity to make a
statement and to respond to appropriate questions.
A vote of the majority of all shares present in person or by proxy
and voting at the Annual Meeting is necessary for the ratification
of Arthur Andersen LLP as the Company's independent auditors for
the fiscal year ending October 31, 1999. If the appointment of
Arthur Andersen LLP is not approved at the Annual Meeting, the
Board of Directors will consider the selection of another
accounting firm.
THE BOARD RECOMMENDS A VOTE FOR THIS PROPOSAL.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the 2000
Annual Meeting of Stockholders must be received by the Company at
the offices shown on the first page of the Proxy Statement on or
before September 22, 1999, in order to be included in the proxy
material proposed to be issued in connection with such meeting.
OTHER MATTERS
Management is not aware of any matters to come before the Annual
Meeting which will require the vote of stockholders other than
those matters indicated in the Notice of Meeting and this Proxy
Statement. However, if any other matter requiring stockholder
action should properly come before the Annual Meeting or any
adjournment thereof, those persons named as proxies on the
enclosed proxy card will vote thereon according to their best
judgement.
By order of the Board of Directors
Dated: January 21, 1999
Lewis W. Ediger
Secretary
