<PAGE>
SCHEDULE 14A INFORMATION
===============================================================================
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] 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 (S) 240.14a-11(c) or (S) 240.14a-12
BCT INTERNATIONAL, 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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
BCT INTERNATIONAL, INC.
3000 N.E. 30th Place
Fort Lauderdale, Florida 33306-1957
Dear Stockholder:
The 2000 Annual Meeting of Stockholders of BCT International, Inc. will be
held at the Corporate Office, 3000 N.E. 30th Place, 5th Floor, Fort Lauderdale,
Florida on Thursday, November 2, 2000, at 9:00 a.m. You are invited to attend
the meeting to consider personally the business described in the accompanying
notice of annual meeting and proxy statement.
At the meeting there will be a current report on the activities of the
Company. Stockholders will have an opportunity at that time to comment on or to
inquire about the affairs of the Company that may be of interest to stockholders
generally.
It is important to ensure that your shares be represented at the meeting
whether or not you plan personally to attend. We urge you to promptly complete,
sign, date, and return the enclosed proxy in the enclosed envelope. If you
attend the meeting, you may revoke your proxy and vote in person by giving
notice to the Secretary in writing before the Proxy is voted.
Sincerely,
/s/ William A. Wilkerson
WILLIAM A. WILKERSON
Chairman of the Board
September 29, 2000
1
<PAGE>
BCT INTERNATIONAL, INC.
3000 N.E. 30th Place
Fort Lauderdale, Florida 33306-1957
NOTICE OF 2000 ANNUAL
MEETING OF STOCKHOLDERS
-----------------------
NOTICE IS HEREBY GIVEN that the 2000 Annual Meeting of Stockholders of BCT
International, Inc., (the "Company") will be held at the Corporate Office, 3000
N.E. 30th Place, 5th Floor, Fort Lauderdale, Florida on Thursday, November 2,
2000, at 9:00 a.m. (local time) for the following purposes:
A. To elect directors.
B. To consider and vote on:
(1) A proposal to approve the selection by the Board of
Directors of the firm of PricewaterhouseCoopers LLP as
independent auditors of the Company for the fiscal year
ending February 28, 2001.
C. To transact such other business as may properly come before the
meeting.
Only stockholders of record at the close of business on September 22, 2000
are entitled to notice of and to vote at the annual meeting.
The Company's Proxy Statement is submitted herewith. The Company's Annual
Report for the fiscal year ended February 29, 2000 is enclosed.
By Order of the Board of Directors
/s/ Michael R. Hull
MICHAEL R. HULL
Secretary
A proxy is enclosed with this Notice and Proxy Statement. Please COMPLETE,
SIGN, DATE and promptly return your proxy in the enclosed envelope. This will
assure a quorum and save further solicitation costs. If you attend the meeting,
you may revoke your proxy and vote in person by giving notice to the Secretary
in writing before the proxy is voted.
2
<PAGE>
BCT INTERNATIONAL, INC.
3000 N.E. 30th Place
Fort Lauderdale, Florida 33306-1957
Telephone (954)563-1224
2000 ANNUAL
MEETING OF STOCKHOLDERS
---------------
PROXY STATEMENT
---------------
September 29, 2000
GENERAL INFORMATION
Introduction
The enclosed proxy, which is to be used only at the Annual Meeting of
Stockholders of BCT International, Inc., (the "Company") to be held on November
2, 2000 and any and all adjournments thereof (the "Annual Meeting"), is
solicited on behalf of the Board of Directors of the Company at the Company's
expense. The purposes of the Annual Meeting are set forth in the accompanying
Notice of 2000 Annual Meeting of Stockholders.
The solicitation is being made by mail, but officers of the Company may
solicit proxies personally, by telephone, fax or by e mail. The Company does not
presently intend to pay compensation to anyone for the solicitation of proxies,
except that it will reimburse brokers, custodians and other nominees and
fiduciaries for the cost of transmitting the proxy material to stockholders.
Any stockholder executing a proxy retains the right to revoke it by written
notice to the Secretary of the Company at any time before it is voted.
Only holders of record of issued and outstanding Common Stock, $.04 par
value per share ("Common Stock"), of the Company at the close of business on
September 22, 2000 are entitled to vote at the Annual Meeting. Each share is
entitled to one vote. As of that date, the Company had outstanding 5,822,208
shares of Common Stock. The presence, in person or by proxy, of a majority of
the issued and outstanding Common Stock of the Company will constitute a quorum
for the transaction of business at the Annual Meeting.
Shares represented by proxy in the form enclosed, duly executed and
returned to the Company prior to or at the Annual Meeting and not revoked, will
be voied. Where a specification is made by means of the ballot provided in the
proxy, such proxy will be voted in accordance with such specification. Where no
such specification is made, such proxy will be voted for the election of
Directors in accordance with management's nominations and in favor of the
proposal described herein and listed as Proposal 1 in the accompanying Notice of
2000 Annual Meeting of Stockholders
3
<PAGE>
As of this date, the Board of Directors is not aware that any matter is to
be presented for action at the Annual Meeting other than those referred to in
the Notice of 2000 Annual Meeting of Stockholders, but the proxy form sent
herewith, if executed and returned, gives discretionary authority with respect
to any other matters that may come before the Annual Meeting.
This proxy material, including the Notice of 2000 Annual Meeting of
Stockholders, Proxy Statement, Proxy and Annual Report for the fiscal year ended
February 29, 2000, was first mailed to stockholders on or about October 6, 2000.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth as of September 22, 2000 information with
respect to the only persons known to the Company to be beneficial owners of more
than 5% of the Company's outstanding stock (excluding treasury stock), as well
as the beneficial ownership of all directors and officers of the Company
individually and all directors and officers as a group. Based on the information
available to the Company, except as set forth in the accompanying footnotes,
each person has sole investment and voting power with respect to the shares of
Common Stock indicated. At September 22, 2000, 5,822,208 shares of common stock
were outstanding.
Number of Shares Percent of
Beneficially Outstanding
Name Owned (1) Common Stock
---- --------- ------------
Certain Beneficial Owners:
Steven N. Bronson 545,082 9.36%
16 E. 52 Street
Suite 501
New York, NY 10022
Officers and Directors:
William A. Wilkerson 1,328,057 (2) 21.56%
Bill LeVine 702,532 (3) 11.91%
Peter T. Gaughn 223,500 (4) 3.71%
Henry A. Johnson 159,347 (5) 2.72%
Jeff Hewson 55,541 (6) .95%
Thomas J. Cassady 43,750 (7) .75%
Michael R. Hull 18,500 (8) .32%
All Officers, Directors,
and Nominees (9) 38.70%
as a group (7 persons)
----------------------
4
<PAGE>
(1) This column sets forth shares of Common Stock which are deemed to be
"beneficially owned" by the persons named in the table under Rule 13d-3 of
the Securities and Exchange Commission ("SEC").
(2) Includes 336,250 shares covered by currently exercisable stock options.
(3) Includes 78,750 shares covered by currently exercisable stock options.
(4) Includes 207,500 shares covered by currently exercisable stock options.
(5) Includes 36,250 shares covered by currently exercisable stock options.
(6) Includes 15,000 shares covered by currently exercisable stock options.
(7) Includes 27,500 shares covered by currently exercisable stock options.
(8) Includes 18,000 shares covered by currently exercisable stock options.
(9) Includes 719,250 shares covered by currently exercisable stock options.
5
<PAGE>
Availability of Form 10-K Report
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR
ENDED FEBRUARY 29, 2000 (INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES
THERETO), AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WILL BE
FURNISHED WITHOUT CHARGE, UPON WRITTEN REQUEST, TO ANY PERSON WHO ON SEPTEMBER
22, 2000 EITHER HELD COMMON STOCK OF THE COMPANY IN HIS OR HER NAME OR WAS THE
BENEFICIAL OWNER OF SUCH STOCK HELD IN THE NAME OF ANOTHER PERSON. STOCKHOLDERS
SHOULD SEND THEIR REQUESTS TO: BCT INTERNATIONAL, INC., 3000 N.E. 30th PLACE,
5TH FLOOR, FORT LAUDERDALE, FLORIDA 33306-1957, ATTENTION, CORPORATE SECRETARY
OWNERS OF STOCK HELD IN THE NAME OF ANOTHER PERSON MUST INCLUDE IN THEIR
REQUESTS A REPRESENTATION THAT THEY WERE THE BENEFICIAL OWNERS OF COMMON STOCK
OF THE COMPANY AS OF SEPTEMBER 22, 2000. THE COMPANY WILL FURNISH ANY EXHIBITS
TO FORM 10-K TO EACH STOCKHOLDER REQUESTING THEM UPON PAYMENT OF A FEE OF $.30
PER PAGE TO COVER THEIR COST.
Submission of Stockholder Proposals
Any stockholder proposals for the 2001 Annual Meeting of Stockholders must
be received by the Company no later than April 1, 2001, to be eligible for
inclusion in the Company's proxy statement and accompanying proxy for such
meeting.
ELECTION OF DIRECTORS OF THE COMPANY
As provided for in Article Eight of its Certificate of Incorporation, the
Company has a classified Board of Directors consisting of classes I, II and III,
with one class to be elected at each Annual Meeting of Stockholders. The current
Directors of the Company by class are as follows:
Class I Class II Class III
(expires 2000) (expires 2002) (expires 2001)
------------ ------------ ------------
William A. Wilkerson Thomas J. Cassady Henry A. Johnson
Bill LeVine Jeff Hewson Peter T. Gaughn
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<PAGE>
Nominees for Election as Director of the Company
Messrs. William A. Wilkerson, and Bill LeVine have been nominated by the
Board of Directors for election as Class I Directors. If any nominee for
director is unable or declines to serve for any reason not now foreseen, the
discretionary authority provided in the proxy will be exercised to vote for a
substitute. The nominees have consented to serving as directors.
The following information is set forth below for the nominees: principal
occupation during the past five or more years, the period of service as a
director of the Company or its predecessor, other directorships and business
affiliations (including public Company directorships), and age:
Name Age Position Director Since
---- --- -------- --------------
William A. Wilkerson 58 Chairman of the January 1978
Board
Bill Levine 80 Director May 1992
William Wilkerson has been Chairman of the Board and a Director of the
Company since January 1986. In May 1988, he accepted the additional
responsibility of Chief Executive Officer, a position he held until October
1997. He was President and Chief Executive Officer of Business Cards Tomorrow,
Inc. (a Florida Corporation) from January 1978 to January 1982 and Chairman from
January 1982 to January 1986.
Bill LeVine became a Director of the Company in May 1992. Mr. LeVine is
the pioneer of the quick printing industry. He found Postal Instant Press (PIP
Printing) in 1967 and served as its Chairman, Chief Executive Officer and
President until January 1988. Since that time, he has focused on private
investments. Since 1992, Mr. LeVine has been a Director of Mellon First Business
Bank in Los Angeles, California, since 1982. Rentrak Company, formerly National
Video, Portland, Oregon, since 1987, and California Closets, Inc., San
Francisco, California, since 1994.
The following information is set forth for directors of the Company who
are notstanding for election in 2000: principal occupations during the past five
or more years, the period of service as a director of the Company or its
predecessor, other directorships and business affiliations (including public
Company directorships), and age:
Name Age Position Director Since
---- --- -------- --------------
Henry A. Johnson 65 Director February 1975
Peter R. Gaughn 44 Director April 1998
Thomas J. Cassady 78 Director April 1998
Jeff Hewson 57 Nominee October 1999
7
<PAGE>
Henry A. Johnson, founder of BCT, has been a Director of the Company since
January 1986. From January 1986 until October 1988, he was Senior Vice
President/Operations of the Company. In October 1988, he resigned his position
with the Company and became Senior Vice President/Operations of the Company's
Business Cards Tomorrow, Inc., subsidiary ("BCT"). In February 1989, he accepted
the additional responsibilities of Executive Vice President of BCT. Previously,
he was Senior Vice President/Operations for Business Cards Tomorrow, Inc. (a
Florida Corporation), from January 1978. In March 1990, he retired from his
position with BCT. Presently, Mr. Johnson is the owner of Colourful Copies in
Las Vegas, Nevada and Johnson Enterprises of West Palm Beach, Inc.
Peter T. Gaughn became President and CEO of the Company in May, 1999. He
previously served as President and Chief Executive Officer and Director of PIP
Printing, a position he held from February 1995 to April 1999. Previously, Mr.
Gaughn was President and Chief Operating Officer of the Company from August 1989
to January 1995.
Thomas J. Cassady became a Director of the Company in April 1988 and has
been a Director of Photo Control Company, Minneapolis, Minnesota, since February
1978. Mr. Cassady is a veteran of more than 30 years in the financial and
securities field, having served as President and Chief Administrative Officer of
Merrill, Lynch, Pierce, Fenner & Smith, Inc., until his retirement in 1978.
Jeff Hewson was a non-executive director of United Stationers until
November 1997. Mr. Hewson developed the BCT Franchise System in Canada from a
one piant operation to nine franchises from 1984 until 1986. Mr. Hewson has
served as President of Rexel/Acco European operations from 1979 until 1984 as
well as President of the USA and Canada operations from 1987 until 1989. In
addition, Mr. Hewson served as President of United Stationers, the world's
largest wholesaler of office and computer supplies from 1991 until 1997.
Executive Officers of the Company
The following table sets forth the age, position and term of office (with
the Company or its prodecessor) of each executive officer of the Company:
Executive
Executive Officer Age Position OfficerSince
----------------- --- -------- ------------
William A. Wilkerson 68 Chairman of the Board January 1978
Peter T. Gaughn 44 Chief Executive Officer, May 1999
President and Director
Michael R. Hull 47 Chief Financial Officer, June 1996
Treasurer and Secretary
See information concerning Messrs. Wilkerson and Gaughn under "Election of
Directors of the Company", above.
8
<PAGE>
Michael R. Hull joined the Company in May 1996 and became Vice President/
Chief Financial Officer, Treasurer and Secretary effective May 31, 1996. Mr.
Hull is a certified public accountant and a member of the Florida Institute of
Certified Public Accountants and the American Institute of Certified Public
Accountants and has worked in public accounting since 1985. Prior to joining
BCT, Mr. Hull served as an audit senior manager with the public accounting firm
of PriceWaterhouse LLP for three years.
Committees of the Board of Directors of the Company
The Company's Board of Directors has an Audit Committee, a Compensation
Committee, and a Stock Option Committee.
The Audit Committee's functions are set forth in the Audit Committee
Charter attached as Appendix A to this Proxy Statement, which the Board of
Directors adopted on June 28, 2000, in accordance with the rules of the National
Association of Securities Dealers ("NASD"). Those functions include evaluating,
and recommending to the Board of Directors the engagement of, the Company's
independent certified public accountants, reviewing the results of their audit
findings, and monitoring on a periodic basis the internal controls of the
Company.
Pursuant to the Audit Committee Charter, the Audit Committee has reviewed
and discussed the Company's audited financial statements for its year ended
February 29, 2000, with the management of the Company and Company's independent
auditors. PricewaterhouseCoopers LLP ("PWC"). The Audit Committee has discussed
with management and PWC any significant changes to the Company's accounting
principles, the degree of aggressiveness or conservatism of the accounting
principles and underlying estimates used in the preparation of the Company's
financial statements, and any items required to be communicated by the outside
auditors in accordance with Statement of Auditing Standards ("SAS") No. 61. The
Audit Committee has reviewed and confirmed the independence of PWC as outside
auditors by requiring that PWC submit to the Audit Committee a formal written
statement delineating all relationships between PWC and the Company, and has
engaged in a dialogue with PWC with respect to any disclosed relationships or
services that may impact PWC's objectivity and independence. Based in part on
the foregoing, the Audit Committee recommended to the Board that the financial
statements as of and for the years ended February 29, 2000, audited by PWC be
included in the Company's Annual Report on SEC Form 10-K.
The Audit Committee consists of Messrs. LeVine (Chairman), Cassady and
Johnson. These members are independent as defined in applicable NASD rules.
The Compensation Committee consists of Messrs. LeVine (Chairman), Wilkerson
and Johnson. This committee has the responsibility to review and make
recommendations to the Board of Directors regarding executive compensation,
except stock option matters.
The Stock Option Committee consists of Messrs. LeVine (Chairman) and
Johnson. This committee has the responsibility to review and make
recommendations to the Board of Directors regarding stock options.
The Company has no Nominating Committee.
Meetings of the Board of Directors of the Company
During the Company's fiscal year ended February 29, 2000, six meetings of
the Board of Directors and two meetings of each Committee of the Board were
held.
9
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BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors, a majority of which
is currently comprised of non-employee directors, has overall responsibility to
review and recommend broad-based compensation plans for executive officers of
the Company and its BCT subsidiary to the Board of Directors. Set forth below is
the report submitted by Mr LeVine in his capacity as the Chairman of the Board's
Compensation Committee addressing the Company's compensation policies for fiscal
2000 as they affected Mr. William A. Wilkerson, Chairman of the Board and Mr.
James H. Kaufenberg, President and Chief Executive Officer until his resignation
in April 1999 and Mr. Peter T. Gaughn, President and CEO since May 1999.
Compensation Policies For Executive Officers
The executive compensation program is based on a philosophy which aligns
compensation with business strategy, Company values and management initiatives.
The principles underlying this compensation philosophy are: the linkage of
executive compensation to the enhancement of shareholder value; maintenance of a
compensation program that will attract, motivate and retain key executives
critical to the long-term success of the Company; creation of a performance
oriented environment by rewarding performance leading to the attainment of the
Company's goals; evaluation of competitiveness of salary and equity incentive
opportunities; and determination of the adequacy and propriety of the annual
bonus plan, including structure and performance measures.
Relationship of Performance to Compensation
Compensation paid Mr. Wilkerson in fiscal 2000, consisted of basic salary,
a cash bonus of $40,000, and an award of options to purchase 2,500 shares of the
Company's common stock, at $3.06 per share (the market price on the date of
grant).
The Company's executive compensation policies are oriented primarily toward
utilization of objective performance criteria. Subjective performance criteria
are utilized to only a limited degree.
10
<PAGE>
Objective criteria include actual versus target annual operating budget
performance and actual versus target annual income growth. Target annual income
growth and target annual operating budgets utilized for purposes of evaluating
compensation are based on business plans which have been approved by the Board
of Directors. Subjective performance criteria encompass evaluation of each
officer's initiative and contribution to overall corporate performance, the
officer's managerial ability, and the officer's performance in any special
projects that the officer may have undertaken. Performance under the subjective
criteria was determined at the end of fiscal 2000 after informal discussions
with other members of the Board.
Mr. Wilkerson's Fiscal 2000 Compensation
During fiscal 1993, the Compensation Committee approved a seven year
employment contract for Mr. Wilkerson for fiscal years beginning in fiscal 1994.
All of Mr. Wilkerson's fiscal 1998 compensation was paid pursuant to this
contract. In June 1997, Mr. Wilkerson's contract was extended for an additional
three year term. The agreement calls for minimum annual remaining salary amounts
of $300,000 during the employment term.
In the event that Mr. Wilkerson is substantially incapacitated during the
term of his employment for a period of 90 days in the aggregate during any
twelve month period, the Company has the right to terminate his employment.
Under such termination, Mr. Wilkerson will receive one-half of his salary in
effect on the date of termination for the remaining term of the agreement.
Additionally, in the event of Mr. Wilkerson's death during his employment, his
designated beneficiary or his estate shall be paid one-half of his salary in
effect on the date of his death for the remaining term of the agreement.
Mr. Wilkerson's fiscal 2000 salary was kept at $300,000, which is the
minimum level prescribed for those years in his employment contract. In May
2000, the Compensation Committee increased Mr. Wilkerson's fiscal 2001 minimum
annual salary to $316.000.
In fiscal 2000, Mr. Wilkerson also received a cash bonus of $10,000 based
on the achievement of certain levels of profitability by the Company.
Mr. Gaughn's Fiscal 2000 Compensation
In May 1999, the Committee approved an employment agreement with Peter T.
Gaughn, the President and Chief Executive Officer of the Company. The initial
term of the employment agreement is three years, but shall be automatically
extended for successive one-year terms of $260,000, $262,000 and $276,000. In
addition, the agreement provides for incentive compensation based upon pretax
income of the Company, which shall not exceed $125,000 in fiscal 2000 and shall
not exceed the base salary thereafter. Additionally the agreement granted
options to purchase 400,000 shares of Common Stock of the Company at $2.25, of
100,000 vested immediately and the remainder will vest 15% annually over the
next five years. Further, the agreement provides for the granting each year of
options to purchase shares of the Company's Common Stock equal to the amount of
the
11
<PAGE>
incentive compensation for that year divided by the market price of the
Company's stock on the day preceding the payment of the incentive compensation.
These options shall vest 25% immediately and 15% each year for the five years
thereafter.
Mr. Kaufenberg's Fiscal 2000 Compensation
During fiscal 1997, the Committee approved the terms of Mr. Kaufenberg's
employment. Under the terms of his employment, if Mr. Kaufenberg left the
employment of the Company for any reason, he was entitled to receive six months
of severance pay. Mr. Kaufenberg resigned in April 1999. Consequently, his
severance package was paid and recorded in fiscal 2000. His bonus of $85,000,
based on fiscal 1999 performance, was recorded in fiscal 1999.
SUBMITTED BY THE COMPENSATION COMMITTEE OF THE COMPANY'S
BOARD OF DIRECTORS:
BILL LEVINE HENRY A. JOHNSON WILLIAM A. WILKERSON
12
<PAGE>
Executive Compensation and Transactions
(a) Compensation Tables
The following tables set forth the compensation received for services in
all capacities to the Company during its fiscal years ended February 29, 2000,
February 28, 1999 and 1998, by the executive officers of the Company as to whom
the total salary and bonus in the most recent year exceeded $100,000.
BCT International, Inc.
Summary Compensation Table
Fiscal Years 2000, 1999 and 1998
000's omitted
-------------
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation Awards
------------------------------------------------------------------------------------------------------------------------------------
Fiscal Form of Payment
---------------
Name Position Year Salary Bonus Cash Shares Options
---- -------- ---- ------ ----- ---- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
W.A. Wilkerson Chairman of 2000 $312(1) $40 $352 --- ---
the Board 1999 $312(1) $75 $387 --- 2(2)
1998 $294(1) $50 $344 --- 70(3)
P.T. Gaughn Chief Executive 2000 $218(1) $41 $259 --- 400(4)
Officer and
President
J.H. Kaufenberg Chief Executive 2000 $113 $--- $113 --- ---
Officer and 1999 $150(6) $85 $235 --- 2(2)
President(5) 1998 $150(6) $150 $300 --- ---
M.R. Hull Chief Financial 2000 $96 $32 $128 --- ---
Officer, Secretary 1999 $92 $36 $128 --- ---
and Treasurer 1998 $88 $31 $119 --- ---
</TABLE>
(1) Salary for fiscal 2000, 1999 and 1998 includes a $12 car allowance.
(2) Options granted in fiscal 1999, all of which immediately vested.
(3) Options granted in fiscal 1998, all of which immediately vested.
(4) Options granted in fiscal 2000, 25% of which immediately vested and the
remainder vesting over five years.
(5) Mr. Kaufenberg resigned as an officer and director of the Company in
April 1999. His fiscal 2000 salary includes $24,000 of regular salary,
$17,000 of accrued vacation, $2,000 of car allowance and $70,000 of
severance payments.
(6) Salary includes a $10 car allowance.
13
<PAGE>
BCT International, Inc.
Aggregated Option Exercises and Year-End
Option Values for Fiscal 2000
000's omitted
-------------
<TABLE>
<CAPTION>
Number of Value of
Unexercised In-The-Money
Options at Options at
Shares 2/29/00 (#) 2/29/00 ($)
Acquired on Value Exercisable/ Exercisable/
Name Position Exercise # Realized ($) Unexercisable Unexercisable
---- -------- ----------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C>
W.A. Wilkerson Chairman of
the Board --- $ --- 331/0 $45/$0
P.T. Gaughn Chief Executive
Officer and President 15 $ 16 137/300 $11/$0
M.R. Hull Chief Financial Officer, --- $ --- 15/0 $ 2/$0
Secretary and Treasurer
</TABLE>
14
<PAGE>
BCT International, Inc.
Executive Management Compensation
Option Grants in Fiscal 2000
000's omitted
-------------
<TABLE>
<CAPTION>
Potential
% of Realizable Value
Total at Assumed
Options Annual Rates of
Granted Stock Price
Options to Exercise Expiration Appreciation
Name Position Granted Employees Price Date for Option Term
---- -------- ------- --------- ----- ---- ---------------
<S> <C> <C> <C> <C> <C> <C>
5%($) 10%($)
P.T. Gaughn President and Chief
Executive Officer 400 80% $2.25 05/08/09 $564 / $1,436
</TABLE>
15
<PAGE>
(b) Other Compensation Arrangements
Outside directors of the Company receive director's fees of $750 per month
plus $750 for each Board of Directors meeting attended and $500 for each
telephonic meeting and committee meeting attended.
(c) Performance Graph
The following graph compares the yearly percentage change during the
Company's past five fiscal years in the cumulative total shareholder return on
the COmpany's Common Stock with the cumulative total shareholder return during
the same period for (i) the NASDAQ Stock Market (U.S. Companies) and (ii) a peer
group index of NASDAQ stocks of companies in the Company's industry (the
printing and graphics arts industry). The graph was prepared by the University
of Chicago Graduate School of Business Center for Research in Security Prices.
The cumulative total return in each case was calculated by dividing: (i) the sum
of (A) the cumulative amount of dividends for the measurement period, assuming
dividend reinvestment, and (B) the difference between the share price at the end
and the beginning of the measurement period; by (ii) the share price at the
beginning of the measurement period. Raw data forming the basis for the graph,
together with a list of the companies comprising the peer group index, is also
included.
Comparison of Five Year-Cumulative Total Returns
Performance Graph for
BCT INTERNATIONAL, INC.
Prepared by the Center for Research in Security Prices
Produced on 07/17/2000 including data to 02/29/2000
[PERFORMANCE GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Legend
Symbol CRSP Total Returns Index for: 02/1995 02/1996 02/1997 02/1998 02/1999 02/2000
------ ----------------------------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
[ ] BCT International, Inc. $100.00 $ 76.7 $ 55.8 $ 48.8 $ 48.8 $ 37.2
* Nasdaq Stock Market (US Companies) $100.00 $139.4 $166.8 $227.8 $296.0 $604.7
/\ NASDAQ Stocks (SIC 2750-2759 US Companies) $100.00 $264.2 $184.8 $210.0 $107.8 $228.5
Commercial Printing
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that, include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 02/28/1995.
</TABLE>
16
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(d) Compliance with Section 16(a) of the Exchange Act
The Company has reviewed the Forms 3 and 4 and amendments thereto furnished
to it pursuant to SEC Rule 16a 3(e) during its most recent fiscal year and Form
5 and amendments thereto furnished to the Company with respect to its most
recent fiscal year. Based solely on such review and the representations of each
director and executive officer, the Company is not aware of any instance
involving a late filing of a required form by a person who, at any time during
the fiscal year, was a director, executive officer or beneficial owner of more
than 10% of the Company's Common Stock and failed to file on a timely basis, as
disclosed in the above described Forms, reports required by the Securities
Exchange Act of 1934 during the most recent fiscal year.
(e) Certain Relationships and Related Transactions
In February 1996, a company of which Mr. Wilkerson, the Chairman of the
Board is a 50% shareholder, purchased the Honolulu, Hawaii franchise (the
"Hawaii Franchise") for a total purchase price of $400,000 plus accounts
receivable and inventory. The purchase price was payable pursuant to a $325,000
promissory note, representing an assumption of the prior franchisee's debt to
the Company and a $108,000 promissory note representing the value of the
inventory and accounts receivable acquired. The $325,000 note bears interest at
8% per year and requires equal monthly payments of principal and interest for 10
years based on a 15-year amortization, with a balloon payment due at the end of
10 years. The $108,000 note bears interest 8% per year and is payable in five
years pursuant to equal monthly payments of principal and interest. During
fiscal 1997, the Company advanced an additional $65,000 to the Hawaii Franchise
in exchange for three promissory notes due February 28, 1997 bearing interest of
8% (the $65,000 notes"). The Hawaii Franchise notes are secured by pledges of
substantially all of the assets of the Hawaii Franchise, as well as the personal
guarantees of the shareholders.
The Hawaii Franchise is 49 months behind on payments under the $325,000
note and 49 months behind on payments under the $108,000 note. No payments have
been made on the $65,000 notes. Further, the Hawaii Franchise's debt to the
Company for paper purchases, royalties and other advances totalling $561,000 is
more than 90 days past due as of September 30, 2000. In fiscal 1999, the Company
advanced $167,000 to the owners of the Hawaii Franchise as repayment of monies
contributed by the owners. Reserves have been recorded on the accounts and notes
receivable relating to the Hawaii Franchise.
The Company has thus far elected not to exercise its contractual rights to
declare a default, accelerate the Hawaii Franchise's indebtness and foreclose
its security interest in the Hawaii Franchise's assets. This election has been
made in accordance with the Company's policy of working closely with troubled
franchisees in an attempt to restore their financial and operating health and of
taking legal action to collect debts and rebossess assets only when the troubled
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franchise appears unable to be successfully turned around. In the case of the
Hawaii Franchise, which was in very poor financial and operating condition when
acquired by Mr. Wilkerson's company, the Company believes that the operating
performance of the Hawaii Franchise has improved and that, by continuing its
current posture, the Company will maximize the probability of making the Hawaii
Franchise a successful franchise contributing to the Company's long-term
profitability. In May 2000, in order to further secure his obligations to the
Company in connection with the Hawaii Franchise. Mr. Wilkerson pledged 100,000
shares of the Company's Common Stock as collateral for those obligations.
On April 19, 1999, James H. Kaufenberg resigned from his positions as
President, Chief Executive Officer and Director of the Company. In connection
with his resignation, the Company and Mr. Kaufenberg entered into an agreement
providing for (i) payment to Mr. Kaufenberg of $70,000 pursuant to six months of
salary payments at an annual rate of $140,000 from May to October 1999, (ii)
payment to Mr. Kaufenberg of an $85,000 bonus for fiscal 1999, (iii) exercise by
Mr. Kaufenberg of options to purchase 23,700 shares of Common Stock at an
exercise price of $1,875 per share, (iv) payment by the Company to Mr.
Kaufenberg of $34,475 in cancellation of Mr. Kaufenberg's remaining options to
purchase 78,800 shares of Common Stock at an exercise price of $1.875 per share
($.4375 per option share), (v) payment to Mr. Kaufenberg of $17,500 in accrued
vacation and (vi) customary releases, indemnification and other legal
provisions.
Effective May 8, 1999, the Company entered into a three-year employment
agreement with Peter T. Gaughn, its new President and Chief Executive Officer.
The agreement provides for a base salary of $250,000 during the first year with
minimum 5% salary increases thereafter. In addition, the agreement provides for
incentive compensation based upon the Company's pre-tax income which
compensation shall not exceed $125,000 in fiscal 2000 and shall not exceed the
base salary thereafter. Additionally, the agreement provides for the grant of
options to purchase 400,000 shares of Common Stock at $2.25, of which 100,000
shares vested immediately and the remainder shall vest in annual increments of
60,000 shares over the next five years. In addition, the agreement provides for
the granting each year of options to purchase a number of shares of Common Stock
equal to the amount of incentive compensation for that fiscal year divided by
the market price of the Common Stock on the day preceding the payment of the
incentive compensation. These options will vest 25% immediately and 15% each
year for five years thereafter.
(f) Compensation Committee Interlocks and Insider Participation
Messrs. LeVine and Johnson are currently members of the Board's
Compensation Committee
Proposal 1
APPROVE SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected PricewaterhouseCoopers LLP as the
independent auditors for the Company for the fiscal year ending February 28,
2001
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This selection is submitted for approval by stockholders at the Annual Meeting.
The affirmative vote of the holders of a majority of the shares voted is
required for the approval of the foregoing proposal. The holders of the enclosed
proxy will vote to ratify the action of the Board of Directors, unless otherwise
directed.
The Board of Directors recommends a vote FOR this Proposal 1.
Appendix A
BCT INTERNATIONAL, INC. AUDIT COMMITTEE CHARTER
The audit committee is a committee of the Board of Directors. Its primary
function is to assist the board in fulfilling its oversight responsibilities by
reviewing the financial information which will be provided to the shareholders
and others, the systems of internal controls which management and the board of
directors have established, and the audit process
In meeting its responsibilities, the audit committee shall:
1. Provide an open avenue of communication between the outside auditors
and the Board of Directors.
2. Review and update the committee's charter annually.
3. Recommend to the board of directors the outside auditors to be
nominated, approve the compensation of the outside auditors, and review and
approve the discharge of the outside auditors.
4. Confirm and assure the independence of the outside auditors, including
a review of management consulting services and related fees provided by the
outside auditors, and obtain a formal written statement from the outside
auditors delineating all relationships between the outside auditors and the
company, consistent with independence Standards Board Standard 1.
5. Actively engage in a dialogue with the outside auditors with respect
to any disclosed relationships or services that may impact the objectivity and
independence of the outside auditors and take, or recommend that the Board of
Directors take, appropriate action to oversee the independence of the outside
auditors.
6. Inquire of management and the outside auditors about significant risks
of exposures and assess the steps management has taken to minimize such risk to
the company.
7. Consider, in consultation with the outside auditors, the audit scope
and plan of the outside auditors.
8. Consider with management and the outside auditors the rationale for
employing audit firms other than the principal outside auditors.
9. Review with the outside auditors the coordination of audit efforts to
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<PAGE>
assure completeness of coverage, reduction of redundant efforts, and the
effective use of audit resources.
10. Consider and review with the outside auditors and management.
(a) The adequacy of the company's internal controls including
computerized information system controls and security.
(b) Any related significant findings and recommendations of the
outside auditors together with management's responses thereto.
11. Review with management and the outside auditors at the completion of
the annual examination:
(a) The company's annual financial statements and related footnotes
(b) The outside auditors' audit of the financial statements and their
report thereon.
(c) Any significant changes required in the outside auditors' audit
plan
(d) Any serious difficulties or disputes with management encountered
during the course of the audit.
(e) Other matters related to the conduct of the audit which are to be
communicated to the committee under generally accepted auditing
standards.
12. Consider and review with management:
(a) Significant findings during the year and management's responses
thereto.
(b) Any difficulties encountered in the course of the audit, including
any restrictions on the scope of the outside auditors' work or access
to required information.
(c) Any changes required in the scope of the audit plan.
13. Review filings with the SEC and other published documents containing
the company's financial statements and consider whether the information
contained in these documents is consistent with the information contained in the
financial statements.
14. Review with management and the outside auditors all interim financial
reports before filing with the SEC or other regulators.
15. Review policies and procedures with respect to officers' expense
accounts and perquisites, including their use of corporate assets, and consider
the
20
<PAGE>
results of any review of these areas by the outside auditors.
16. Review with the outside auditors the results of their review of the
company's monitoring compliance with the company's code of conduct.
17. Review legal and regulatory matters that may have a material impact on
the financial statements, related company compliance policies and programs and
reports received from regulators.
18. Meet with the outside auditors and management in separate executive
sessions to discuss any matters that the committee or these groups believe
should be discussed privately with the audit committee.
19. Report committee actions to the Board of Directors with such
recommendations as the committee may deem appropriate.
20. Prepare a letter for inclusion in the annual report that describes the
committee's composition and responsibilities, and how they were discharged.
21. Have the power to conduct or authorize investigations into any matters
within the committee's scope of responsibilities. The committee shall be
empowered to retain independent counsel, accountants, or others to assist it in
the conduct of any investigation.
22. Meet at least four times per year or more frequently as circumstances
require. The committee may ask members of management of others to attend
meetings and provide pertinent information as necessary.
23. Perform such other functions as assigned by law, the company's charter
or bylaws, or the board of directors.
The membership of the audit committee shall consist of at least three
independent members of the board of directors, who shall serve at the pleasure
of the Board of Directors. Audit committee members and the committee chairman
shall be designated by the full Board of Directors.
All audit committee members must be able to read and understand fundamental
financial statements including the company's balance sheets, income statements
and cash flow statements. At least one member of the audit committee shall have
past employment experience in finance or accounting, requisite professional
certification in accounting, or any other comparable experience or background
which results in the individual's financial sophistication, including being or
having been a chief executive officer, chief financial officer or other senior
officer with financial oversight responsibilities.
The duties and responsibilities of a member of the audit committee are in
addition to those duties set out for a member of the Board of Directors.
21
<PAGE>
BCT INTERNATIONAL, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
2000 ANNUAL MEETING OF STOCKHOLDERS ON NOVEMBER 2, 2000
The undersigned hereby appoints William A. Wilkerson and Michael R. Hull
proxies with power of substitution to vote at the Annual Meeting (including
adjournments) of Stockholders of BCT INTERNATIONAL, INC., to be held November 2,
2000, with all powers the undersigned would possess if personally present as
specified on the ballot hereon on the election of directors, on the proposals
set forth, and in accordance with their discretion, on any other business that
may come before the meeting, and revokes all proxies previously given by the
undersigned with respect to the shares covered hereby. A majority (or, if only
one, then that one) of the proxies or their substitutes acting at the meeting
may exercise all powers hereby conferred.
(continued on the reverse side)
FOLD AND DETACH HERE
Dear BCT International, Inc. Stockholder:
The 2000 Annual Meeting of Stockholders of BCT International, Inc. will be held
at 9:00 a.m. on Thursday, November 2, 2000, at the Corporate Office, 3000 N.E.
30th Place, 5th Floor, Fort Lauderdale, Florida 33306. You are invited to
attend. It is important to ensure that your shares be represented at the meeting
whether or not you plan personally to attend. We urge you to promptly complete,
sign, date, and return the enclosed proxy in the enclosed envelope. If you
attend the meeting, you may revoke your proxy and vote in person by giving
notice to the Secretary in writing before the proxy is voted.
Sincerely,
William A. Wilkerson
Chairman of the Board
BCT International, Inc.
<PAGE>
Please mark
your votes as
indicated in
this example [X]
I. ELECTION OF CLASS III DIRECTORS
Nominees: William A. Wilkerson and Bill LeVine
[ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY
(except as withheld in (to vote for all nominees
the space to right) listed)
INSTRUCTIONS: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.
--------------------------------------------------------------------------------
II. APPROVE SELECTION OF INDEPENDENT AUDITORS
The Board of Directors recommends a vote FOR the proposal to select
PricewaterhouseCoopers LLP as the independent auditors for the Corporation
for the fiscal year ending February 28, 2001.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
This proxy when properly executed will be voted in the manner directed herein by
the Stockholder. If no contrary specification is made, this proxy will be voted
FOR the election of the nominees of the Board of Directors and upon such other
business as may properly come before the meeting.
Please date, sign as your name appears to left, and return this proxy in the
enclosed envelope, whether or not you expect to attend the meeting. You may
nevertheless vote in person if you do attend.
Date: _______________________________, 2000
PLEASE
SIGN
HERE:______________________________________
(Executors, administrators, trustees,
custodians, etc., should indicate capacity
in which signing. When stock is held in the
names of more than one person each person
would sign the proxy.)
(up arrow) FOLD AND DETACH HERE (up arrow)
