<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (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 Rule 14a-11(c) or Rule 14a-12
ICO, 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:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
<PAGE> 2
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0- 11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 3
[ICO LOGO]
11490 WESTHEIMER, SUITE 1000
HOUSTON, TEXAS 77077
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 8, 1999
The Annual Meeting of Shareholders of ICO, Inc. (the "Company") will be
held at the Westchase Hilton, located at 9999 Westheimer, Houston, Texas, on
Monday, March 8, 1999 at 10:00 a.m. Central Daylight Savings Time, for the
following purposes:
1) To elect three Class II Directors to serve until the 2002
Annual Meeting of Shareholders and until their respective
successors are elected and qualified;
2) To approve the second amendment and restatement of the 1993
Non-Employee Directors Stock Option Plan; and
3) To consider and act upon any matters incidental to the
foregoing purposes and transact such other business as may
properly come before the meeting or any adjournment thereof.
Only holders of shares of Common Stock of record on the books of the
Company at the close of business on January 18, 1999 will be entitled to vote at
the meeting or any adjournment thereof.
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, YOU ARE URGED
TO COMPLETE, DATE, SIGN AND RETURN THE ACCOMPANYING PROXY AT YOUR EARLIEST
CONVENIENCE. A REPLY ENVELOPE IS PROVIDED FOR THIS PURPOSE, WHICH NEEDS NO
POSTAGE IF MAILED IN THE UNITED STATES. YOUR IMMEDIATE ATTENTION IS REQUESTED IN
ORDER TO SAVE YOUR COMPANY ADDITIONAL SOLICITATION EXPENSE.
By Order of the Board of Directors
Asher O. Pacholder Sylvia A. Pacholder
Chairman of the Board and Chief Executive Officer,
Chief Financial Officer President & Secretary
Houston, Texas
January 25, 1999
<PAGE> 4
ICO, INC.
11490 WESTHEIMER, SUITE 1000
HOUSTON, TEXAS 77077
(281) 721-4200
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 8, 1999
The enclosed proxy is solicited by and on behalf of the Board of
Directors (the "Board of Directors" or the "Directors") of ICO, Inc. (the
"Company") for use at the 1999 Annual Meeting of Shareholders (the "Annual
Meeting") to be held on Monday, March 8, 1999 at 10:00 a.m., local time, at the
Westchase Hilton, 9999 Westheimer Road, Houston, Texas, or at any adjournment(s)
or postponement(s) thereof. The solicitation of proxies by the Board of
Directors will be conducted primarily by mail. In addition, officers, directors
and employees of the Company may, without additional compensation, solicit
proxies personally or by telephone, telegram or other forms of wire or facsimile
communication. The Company will pay the cost of soliciting proxies in the
accompanying form. Upon request, the Company will reimburse brokers, custodians,
nominees and fiduciaries for reasonable expenses incurred by them in forwarding
proxy material to beneficial owners of Common Stock, without par value, of the
Company (the "Common Stock"). A copy of the Company's Annual Report is being
sent to shareholders with this Proxy Statement. It is not to be regarded as
proxy soliciting material. The approximate date on which this Proxy Statement
and the enclosed form of proxy (the "Proxy") are first being sent to holders of
Common Stock ("Shareholders") is January 25, 1999.
INFORMATION CONCERNING PROXY
The enclosed Proxy, even though executed and returned, may be revoked
at any time prior to voting of the Proxy (a) by the execution and submission of
a revised Proxy, (b) by written notice to the Secretary of the Company or (c) by
voting in person at the Annual Meeting. In the absence of such revocation,
shares represented by the Proxy will be voted at the Annual Meeting.
Unless contrary instructions are indicated on the enclosed Proxy, all
shares represented by valid proxies received pursuant to this solicitation (and
which have not been revoked or suspended before they are voted) will be voted
(1) FOR the selection of three nominees for Class II Directors named below, and
(2) FOR the approval of the second amendment and restatement of the 1993
Non-Employee Directors Stock Option Plan. In the event a Shareholder specifies a
different choice by means of the enclosed Proxy, the shares of Common Stock of
such Shareholder will be voted in accordance with the specification so made.
VOTING SECURITIES
The only securities of the Company entitled to vote at the Annual
Meeting consist, as of January 19, 1999, of 22,113,646 shares of Common Stock.
The holders of a majority of the shares entitled to vote represented in person
or by proxy, constitutes a quorum for transaction of business at the Annual
Meeting. Only Shareholders of record on the books of the Company on that date
will be entitled to vote at the meeting. In voting on such matters, each
Shareholder is entitled to one vote for each of said shares. Directors are
elected by a plurality of the votes cast by holders of shares entitled to vote
in the election. As described herein, the Company is seeking the approval of the
proposed amendment to the 1993 Directors Plan by a majority of the shares of
stock represented at the Annual Meeting. Any other matters that come before the
annual Meeting will be decided by the affirmative vote of the holders of a
majority of the shares of Common Stock entitled to vote, and voted for or
against, the matter. Both broker non-votes and proxies indicating shareholder
abstentions will be counted for purposes of determining whether there is a
quorum at the Annual Meeting, and will be deemed to be present and represented
at the Annual Meeting
<PAGE> 5
for purposes of voting on the 1993 Director Plan, but will not be voted on in
the election of directors or any other matter that comes before the annual
Meeting. Thus, abstentions and broker non-votes will have the same effect as a
vote against the amendment to the 1993 Director Plan, but will be disregarded in
the calculation of "votes cast" with respect to the election of directors or any
other matter and will not have the effect of being a vote "for" or "against"
such election or other matter. A broker non-vote occurs if a broker or other
nominee present in person or by proxy does not have discretionary authority and
has not received instructions with respect to a particular item or does not cast
a vote on that item for other reasons.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
OF MORE THAN 5% OF OUTSTANDING STOCK
The following table contains information concerning the security
ownership of certain beneficial owners known to the management of the Company,
based upon filings with the Securities and Exchange Commission, which
beneficially own more than five percent of the Company's Common Stock at the
close of business on January 19, 1998. Shareholders who are a party to the
Shareholders Agreement described below, who individually are not record holders
of more than five percent of the Company's Common Stock have not been set forth
in the following table.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
- ------------------------------------ -------------------- ----------------
<S> <C> <C>
Asher O. Pacholder
11490 Westheimer, Suite 1000
Houston, Texas 77077 2,346,960 (1)(2) 10.4%(1)(2)
Sylvia A. Pacholder
11490 Westheimer, Suite 1000
Houston, Texas 77077 2,341,695 (1)(2) 10.4%(1)(2)
William E. Willoughby
607 U.S. Highway 202
Far Hills,, New Jersey 07931 1,799,422 (1)(2) 8.1%(1)(2)
DePrince, Race, Zollo & Company
201 S. Orange Avenue, Suite 850
Orlando, Florida 32801 1,270,000 5.7%
Luther King Capital Management Corporation
301 Commerce, Suite 1600
Fort Worth, Texas 76102 1,233,300 5.6%
Dimensional Fund Advisors
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401-1005 1,187,609 5.4%
</TABLE>
(1) Dr. Asher O. Pacholder, Sylvia A. Pacholder , Robin E. Pacholder , William
J. Morgan , Pacholder Associates, Inc. (these shareholders are collectively
the "ICO Shareholders"), and William E. Willoughby, Peggy S. Willoughby,
William C. Willoughby (as custodian for William B. Willoughby), Regina S.
Willoughby, Fred R. Feder, Theo J.M.L. Verhoeff and Catherine Willoughby
Stevens (these shareholders are collectively the "Wedco Shareholders") (the
ICO Shareholders and the Wedco Shareholders are collectively the
"Shareholders") and the Company are parties to a Shareholders' Agreement
(covering in the aggregate 5,215,825 Common Stock), pursuant to which the
Shareholders agree to take all actions necessary or appropriate to cause
the election of William E. Willoughby, Walter Leib and George S. Sirusas
(the "Initial Wedco Directors") to the Board of Directors of the Company
and to cause their re-election to the Board of Directors of the Company
until the earlier of the time the Wedco Shareholders who are parties to the
Shareholders' Agreement, taken as a whole, beneficially own less than
1,500,000 shares of Common Stock or there is a "change in control" of the
Company, when the ICO Shareholders who are parties to the Shareholders'
Agreement shall no longer be obligated to cause
2
<PAGE> 6
the re-election of the Initial Wedco Directors to the Company's Board of
Directors ("Termination Date"). In addition, if any one of Messrs.
Willoughby, Leib or Sirusas shall cease to serve as a Director of the
Company at any time prior to the Termination Date, the Shareholders will
take all actions necessary and appropriate to ensure that the vacancy
created shall be filled by a person nominated by the remaining Initial
Wedco Director(s) or by the Wedco Shareholders who are parties to the
Shareholders Agreement, subject to the consent of a majority of the full
Board of Directors of the Company.
In addition to the foregoing, all the ICO Shareholders who are parties to
the Shareholders' Agreement have granted irrevocable proxies coupled with
an interest to Mr. Leib to vote their shares of Common Stock in favor to
the slate of nominees for the Company's Board of Directors selected by the
then incumbent members of the Board of Directors of the Company (the
"Nominated Slate") and the Wedco Shareholders who are parties to the
Shareholders' Agreement granted substantially identical proxies to Ms. S.
Pacholder and Dr. Pacholder to vote their shares of Common Stock of the
Company also in favor of the Nominated Slate.
The Shareholders' Agreement also provides that if one or more of the
Shareholders desire to sell 500,000 or more shares of Common Stock in a
single or series of related transactions (other than in connection with an
underwritten public offering that would not result in a transfer or
transfers of 500,000 or more shares of Common Stock to any person or group
of persons) such proposed sale shall not be effective unless the proposed
transferee agrees to be bound as the successor to the transferor under the
agreement. The Shareholders' Agreement is filed as exhibit 10.9 to the
Company's Form S-4 dated May 15, 1996.
(2) See "Election of Directors" for information regarding the security
ownership of Dr. Pacholder, Ms. S. Pacholder and Mr. W. Willoughby.
ELECTION OF DIRECTORS
Three directors are to be elected at the Annual Meeting. The Company's
Bylaws provide for a classified Board of Directors. Thus, the Board of Directors
is divided into Classes I, II and III, the terms of office of which are
currently scheduled to expire, respectively, on the dates of the Company's
Annual meetings of Shareholders in 2001, 1999 and 2000, respectively. Each
Director elected at an annual meeting serves for a term ending on the date of
the third annual meeting following the meeting at which such Director was
elected or until his successor shall have been duly elected and qualified or
until his earlier death, resignation or removal. William J. Morgan, Sylvia A.
Pacholder and William E. Willoughby have been nominated to serve as Class II
Directors until the Company's Annual Meeting of Shareholders in 2002. Each of
the nominees currently serves as a Director of the Company. The remaining seven
Directors named below will not be required to stand for election at the Annual
Meeting because their present terms expire in either 2000 or 2001. A plurality
of votes cast in person or by proxy by the holders of Common Stock is required
to elect a Director. Abstentions and broker non-votes (as described above) will
have no effect on the election of Directors.
Unless otherwise instructed or unless authority to vote is withheld, the
enclosed proxy will be voted FOR the election of the Class II nominees listed
below. Although the Board of Directors does not contemplate that any of the
nominees will not be a candidate or will be unable to serve, if such a situation
arises, the persons named in the enclosed proxy, in the absence of contrary
instructions, will in their discretion vote FOR the election of such other
persons as may be nominated by the Board of Directors.
3
<PAGE> 7
The following table sets forth for each nominee listed in the Proxy and
each other person whose term of office as a director will continue after the
annual meeting: (i) the name and age of such person; (ii) the year during which
such person first became a director; and (iii) principle position with the
Company. The table has been prepared from information obtained from such
persons.
<TABLE>
<CAPTION>
NAME AGE DIRECTOR SINCE POSITION WITH THE COMPANY
- ----------------------------------------------------------------------------------------------------------------
Class II Directors whose terms (if re-elected) will expire 2002
<S> <C> <C> <C>
William J. Morgan (1)(2)(3) 44 1992 Director
Sylvia A. Pacholder (3) 56 1993 Chief Executive Officer, President and Director
William E. Willoughby 78 1996 Director
Class III Directors whose terms will expire 2000
Asher O. Pacholder (3) 61 1990 Chairman of the Board, Chief Financial Officer
and Director
John F. Williamson (1) 60 1995 Director
Walter L. Leib (2) 68 1996 Director
James E. Gibson (2) 34 1996 Director
Class I Directors whose terms will expire 2001
William E. Cornelius (1)(2) 50 1992 Director
Robin E. Pacholder 32 1993 President - Wedco North America and Director
George S. Sirusas (2) 59 1996 Director
</TABLE>
- ------------------------
(1) Compensation Committee member
(2) Audit Committee member
(3) Executive Committee member
NOMINEES
William J. Morgan has been President and a Managing Director of Pacholder
Associates, Inc., an investment advisory firm, for more than five years. He is
Chairman of the Board of Directors of Pacholder Fund, Inc., a closed-end
investment company, and serves as a Director for Kaiser Ventures, Inc., an
environmental resources company, and Smith Corona Corporation, an office supply
company.
Sylvia A. Pacholder has been Chief Executive Officer of the Company since
February 1995, and President since November 1994. From July 1994 to November
1994, Ms. Pacholder served as Executive Vice President, and from January 1994 to
July 1994 she served as Vice President - Corporate Development of the Company.
William E. Willoughby founded Wedco and was employed by Wedco as its
Chairman of the Board and President from 1960 through April 1996.
DIRECTORS WITH TERMS EXPIRING IN 2000 AND 2001
Asher O. Pacholder, spouse of Sylvia Pacholder, has been Chairman of the
Board of Directors and Chief Financial Officer of the Company since February
1995. Dr. Pacholder has been Chairman of the Board and a Managing Director of
Pacholder Associates, Inc. since 1983. He serves on the boards of Southland
Corporation, which owns and operates convenience stores, and Trump's Castle
Associates, which owns and operates the Trump's Castle Casino Resort in Atlantic
City, New Jersey.
4
<PAGE> 8
John F. Williamson has been Chairman and President of Williamson
Associates, Inc., an investment management company, since January 1996. From May
of 1995 to January 1996, Mr. Williamson was Executive Vice President and Chief
Financial Officer of Asset Allocation Concepts, Inc., an investment management
company. From 1993 to 1994, Mr. Williamson was Vice President/Manager of
Investments for American Life and Casualty Insurance Company. Mr. Williamson
serves on the Board of Directors of Pacholder Fund, Inc.
Walter L. Leib has been Senior Partner in the law firm of Leib, Kraus,
Grispin & Roth, in Scotch Plains, New Jersey since its inception in 1971. Mr.
Leib served as a Director of Wedco from 1970 and General Counsel to Wedco from
its inception in 1960, until the acquisition of Wedco by ICO in April 1996.
James E. Gibson has been employed as Senior Vice President of Pacholder
Associates, Inc. since 1992 until becoming Executive Vice President in 1997.
William E. Cornelius has been an independent manufacturing consultant since
1991. From 1993 to 1996, Mr. Cornelius served as Division Director of Novare
Services, a health care company.
Robin E. Pacholder, a Chartered Financial Analyst (CFA), has been President
of Wedco - North America since September 1998. From October 1996 to 1998, Ms.
Pacholder was Senior Vice President and General Counsel of the Company. From
1994 to October 1996, Ms. Pacholder was Senior Vice President and Associate
General Counsel of Pacholder Associates, Inc. Ms. Pacholder is the daughter of
Sylvia A. Pacholder and Asher O. Pacholder.
George S. Sirusas has been Senior Vice President of Sebastian Realty since
July 1998. Mr. Sirusas is retired from New Jersey Savings Bank, Somerville, New
Jersey where he was employed from 1983 and until the bank's merger with United
Jersey Bank on September 22, 1995. He served as senior lending officer of the
merged bank since 1986 and held the position of Vice President and Commercial
Lending Officer with the United Jersey Bank, now known as Summit Bank. Mr.
Sirusas was a Wedco Technology, Inc. ("Wedco") Director from 1984 until its
April 1996 acquisition by ICO.
EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth the names, ages and titles of the executive
officers of the Company other than the three executive officers who are also
directors of the Company as of January 19, 1999.
<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY
- ------------------------------------------------------------------------------------
<S> <C> <C>
Theo J.M.L. Verhoeff 49 President - ICO Europe B.V.
Isaac H. Joseph 43 President - ICO Worldwide, Inc.
Jon C. Biro 32 Senior Vice President and Treasurer
David M. Gerst 40 Senior Vice President and General Counsel
</TABLE>
Theo J.M.L. Verhoeff is President of ICO Europe B.V. For more than 5 years
prior to that time, he served as Vice President of European Operations of Wedco.
Isaac H. Joseph has been principally employed as President of ICO
Worldwide, Inc. since 1998. Mr. Joseph was Executive Vice President - Oilfield
Services of ICO from November 1996 to 1998. From July 1996 to November 1996 Mr.
Joseph served as Senior Vice President - Corporate Administration and Sales.
From March 1995 to June 1996, Mr. Joseph was employed as Senior Vice President -
Sales. From November 1994 to March 1995, he was ICO's Louisiana Division
Manager. Mr. Joseph was ICO's Division Sales Manager for Louisiana from June
1994 to November 1994. From March 1992 to June 1994, Mr. Joseph was the
Louisiana Sales Manager for Tuboscope Vetco International.
5
<PAGE> 9
Jon C. Biro, a certified public accountant, has been principally employed
as Controller of the Company since October 1994, as Controller and Treasurer of
ICO since April 1995, and as Senior Vice President and Treasurer since September
1996. Prior to that time, Mr. Biro was a certified public accountant with Price
Waterhouse LLP.
David M. Gerst, a graduate of Stanford University and the UCLA School of
Law, has been Senior Vice President and General Counsel of the Company since
September 1998. Mr. Gerst was Senior Vice President and General Counsel of
Bayshore Industrial, Inc., a subsidiary of the Company, from February 1997 to
August 1998; was a plant manager for Wedco, Inc., a subsidiary of the Company,
from October 1996 to January 1997; was a consultant from 1994 to October 1996;
and has been licensed to practice law since 1983. Mr. Gerst, the husband of Ms.
Robin Pacholder, received $108,000 in compensation in fiscal 1998.
The Board of Directors held seven meetings during the year ended September
30, 1998. Each meeting was attended by all Directors. Each Director who is not
an employee of the Company received an annual retainer of $15,000, and a
Director's fee in the amount of $1,000 for each meeting of the Board or
Committee of the Board actually attended and reimbursement of actual expenses
incurred. The Chairmen of the Audit and Compensation Committees also receive an
annual stipend of $2,000. In addition, each Director who is not an employee is a
participant in the Amended and Restated 1993 Non-Employee Director Stock Option
Plan. Under the current terms of the plan, each non-employee Director is granted
options to purchase 5,000 shares of Common Stock upon appointment to the Board
of Directors and options to purchase 5,000 shares of Common Stock on the first
business day after the date of each subsequent Annual Meeting of Shareholders.
In fiscal 1998, options to purchase 5,000 shares at an exercise price of $5.00
per share were granted to each of Messrs: Morgan, Cornelius, Williamson, Leib,
Willoughby, Sirusas and Gibson.
The Audit and Executive Committees of the Board of Directors met one and
two times, respectively, during the past fiscal year. The Compensation Committee
met two times during the past fiscal year. All committee members were present
for each meeting. The functions of the Audit Committee include reviewing the
engagement of the independent accountants, the scope and timing of the audit and
certain non-audit services to be rendered by the independent accountants,
examining the report of the independent accountants upon completion of their
audit, and reviewing with the independent accountants and management the
Company's policies and procedures with respect to accounting and financial
controls. The Compensation Committee reviews and establishes compensation
arrangements for Directors, officers and other employees and takes whatever
action that may be required in connection with the Company's stock option plans.
The functions of the Executive Committee include reviewing capital expenditure
projects, assisting management in implementing consolidation plans relating to
acquisitions, and assisting management in developing and implementing strategic
plans. The Company does not have a Nominating Committee.
6
<PAGE> 10
SECURITY OWNERSHIP OF
THE BOARD OF DIRECTORS AND
EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth, as of January 15, 1999, the shares of
Common Stock beneficially owned by (i) each director and nominee for director of
the Company, (ii) each executive officer of the Company listed in the Summary
Compensation Table set forth below and (iii) all officers and directors of the
Company as a group. Except as otherwise set forth, such persons have sole voting
power and sole dispositive power with respect to the shares beneficially owned
by them.
<TABLE>
<CAPTION>
Number of shares Percent
Name beneficially owned (1) of Class
- --------------------------------------------------------------------------------------------
<S> <C> <C>
Class I Directors
William E. Cornelius 23,000 (2) *
Robin E. Pacholder 47,140 (1)(3) *
George S. Sirusas 30,219 (4) *
Class II Directors
William J. Morgan 838,432 (1)(5)(6) 3.8%
Sylvia A. Pacholder 2,341,695 (1)(6)(7) 10.4%
William E. Willoughby 1,799,422 (1)(8) 8.1%
Class III Directors
Asher O. Pacholder 2,346,960 (1)(6)(9) 10.4%
John F. Williamson 27,737 (10) *
Walter L. Leib 66,017 (11) *
James E. Gibson 18,000 (12) *
Executive Officers Who Are Not Directors
Theo J.M.L. Verhoeff 131,709 (1)(13) *
Isaac H. Joseph 35,805 (14) *
Jon C. Biro 55,768 (15) *
David M. Gerst 15,915 (16) *
Named Officers and Directors
as a group (14 persons) 4,825,307 (17) 21.0%
</TABLE>
- ----------------------
* Less than 1% of outstanding shares.
(1) Except as otherwise indicated, the beneficial owner listed below has sole
voting and investment powers with respect thereto. Director or Executive
Officer is a Party to the Shareholders' Agreement described in note (1)
of "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS OF MORE THAN 5% OF
OUTSTANDING STOCK." Except as set forth above and in "SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS OF MORE THAN 5% OF OUTSTANDING COMMON
STOCK," share amounts do not include the shares of Common Stock
beneficially owned by other parties to the Shareholders' Agreement. To
the extent the parties to such Shareholders' Agreement constitute a
group, such group and its members would be deemed to be the beneficial
owner of 5,215,825 shares of Common Stock or approximately 23.6% of the
outstanding shares of Common Stock.
(2) Share amounts consist of 23,000 shares which are issuable upon exercise
of stock options granted under the 1993 Stock Option Plan for
Non-Employee Directors.
(3) Share amounts include 8,500 shares of Common Stock, 1,644 Shares of
Common Stock which may be acquired upon conversion of Convertible
Exchangeable Preferred Stock, and 25,000 shares which are issuable upon
exercise of stock options granted under the Company's various employee
stock option plans, 11,000 shares issuable upon exercise of stock options
granted under the 1993 Stock Option Plan for Non-Employee Directors, and
996 shares of Common Stock held in the Company's 401(k) plan. Ms.
Pacholder disclaims beneficial ownership of shares owned by David Gerst.
In fiscal 1998, Ms. Pacholder received $165,000 in compensation.
(4) Share amounts include 13,219 shares of Common Stock and 17,000 shares
which are issuable upon exercise of stock options
7
<PAGE> 11
granted under the 1993 Stock Option Plan for Non-Employee Directors.
Common stock holdings for Mr. Sirusas include 2,379 shares held by his
wife.
(5) Share amounts include 4,000 shares of Common Stock and 23,000 shares
which are issuable upon exercise of stock options granted under the 1993
Stock Option Plan for Non-Employee Directors and the securities disclosed
in note (6) below.
(6) Share amounts include 180,000 shares of Common Stock and 65,460 shares of
Common Stock which may be acquired upon conversion of Convertible
Exchangeable Preferred Stock each held by a limited partnership, of which
Dr. Pacholder and Mr. Morgan are beneficial owners of the general
partner. Pursuant to certain Investment Advisory Agreements, Pacholder
Associates, Inc. has sole voting and investment power over such
securities. Share amounts also include 415,461 shares of Common Stock,
102,879 shares of Common Stock which may be acquired through the exercise
of warrants and 47,632 shares of Common Stock which may be acquired upon
conversion of Convertible Exchangeable Preferred Stock, in each case
owned by a wholly-owned subsidiary of Pacholder Associates, Inc.
(7) Share amounts include 31,400 shares of Common Stock, 165,000 shares which
are issuable upon exercise of stock options granted under the Company's
various employee stock option plans, 2,000 shares issuable upon exercise
of stock options granted under the 1993 Stock Option Plan for
Non-Employee Directors, 2,215 shares of Common Stock held in the
Company's 401(k) plan, the securities disclosed in footnote (6) above and
1,329,648 shares of Common Stock issued in connection with acquisitions
over which Ms. S. Pacholder and Dr. Pacholder share voting power. Ms. S.
Pacholder and Dr. Pacholder disclaim beneficial ownership of the
1,329,648 shares related to the acquisitions.
(8) Share amounts include 1,777,523 shares of Common Stock, 17,000 shares
which are issuable upon exercise of stock options granted under the 1993
Stock Option Plan for Non-Employee Directors and 4,899 shares of Common
Stock held in a 401(k) plan of a wholly-owned subsidiary of the Company.
Common Stock owned by Mr. Willoughby includes 149,139 shares owned
jointly with his wife and 395,665 shares owned by his wife.
(9) Share amounts include 58,200 shares of Common Stock, 140,000 shares which
are issuable upon exercise of stock options granted under the Company's
various employee stock option plans, 6,000 shares issuable upon exercise
of stock options granted under the 1993 Stock Option Plan for
Non-Employee Directors, 1,680 shares of Common Stock held in the
Company's 401(k) plan, the securities disclosed in footnote (6) above,
and 1,329,648 shares of Common Stock issued in connection with
acquisitions over which Ms. S. Pacholder and Dr. Pacholder share voting
power. Ms. S. Pacholder and Dr. Pacholder disclaim beneficial ownership
of the 1,329,648 shares related to the acquisitions.
(10) Share amounts include 8,737 shares of Common Stock, and 19,000 shares
which are issuable upon exercise of stock options granted under the 1993
Stock Option Plan for Non-Employee Directors. Common Stock holdings for
Mr. Williamson includes 425 shares owned by his wife.
(11) Share amounts include 47,921 shares of Common Stock, 1,096 shares of
Common Stock which may be acquired upon conversion of Convertible
Exchangeable Preferred Stock, and 17,000 shares which are issuable upon
exercise of stock options granted under the 1993 Stock Option Plan for
Non-Employee Directors.
(12) Share amounts include 1,000 shares of Common Stock owned jointly by Mr.
Gibson and his wife, and 17,000 shares which are issuable upon exercise
of stock options granted under the 1993 Stock Option Plan for
Non-Employee Directors.
(13) Share amounts include 81,709 shares of Common Stock and 50,000 shares
which are issuable upon exercise of stock options granted under the
Company's various employee stock option plans. Common Stock owned by Mr.
Verhoeff includes 75,149 shares held by his wife.
(14) Share amounts include 34,500 shares which are issuable upon exercise of
stock options granted under the Company's various employee stock option
plans and 1,305 shares of Common Stock held in the Company's 401(k) plan.
(15) Share amounts include 1,500 shares of Common Stock, 52,500 shares which
are issuable upon exercise of stock options granted under the Company's
various employee stock option plans and 1,768 shares of Common Stock held
in the Company's 401(k) plan.
(16) Share amounts include 15,000 shares which are issuable upon exercise of
stock options granted under the Company's various employee stock options
and 915 shares of Common Stock held in the Company's 401(k) plan. Mr.
Gerst disclaims beneficial ownership of shares owned by Ms. R. Pacholder.
(17) Share amounts include 2,033,709 shares of Common Stock, 1,918 Shares of
Common Stock which may be acquired upon conversion of Convertible
Exchangeable Preferred Stock, and 467,000 shares which are issuable upon
exercise of stock options granted under the Company's various employee
stock option plans, 152,000 shares issuable upon exercise of stock
options granted under the 1993 Stock Option Plan for Non-Employee
Directors, 12,863 shares of Common Stock held in the Company's 401(k)
plans, the securities disclosed in note (6) above, and 1,329,648 shares
of Common Stock issued in connection with acquisitions over which Ms. S.
Pacholder and Dr. Pacholder share voting power.
8
<PAGE> 12
EXECUTIVE COMPENSATION
The following table sets forth the cash compensation paid by the Company to each
of the four most highly compensated executive officers and directors (other than
the Company's Chief Executive Officer) and the Company's Chief Executive Officer
(the "Named Executives") during the fiscal years ended September 30, 1998, 1997
and 1996.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
- -------------------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG-TERM COMPENSATION
---------------------------------- ----------------------
SECURITIES
NAME AND UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION(2)
- ------------------ ---- -------- ------------- ----------- ---------------
<S> <C> <C> <C> <C> <C>
Sylvia A. Pacholder 1998 $325,000 $ 220,000(1) 0 $ 2,500
President and 1997 294,000 30,000 80,000 2,900
Chief Executive Officer 1996 175,000 400,000(3) 35,000 2,000
Asher O. Pacholder 1998 $310,000 $ 180,000(1) 0 $ 2,500
Chairman of the Board 1997 276,000 30,000 80,000 2,900
& Chief Financial Officer 1996 150,000 375,000(3) 30,000 1,900
Isaac H. Joseph 1998 $161,000 $ 40,000(1) 0 $ 1,800
Executive Vice President 1997 143,000 38,000 20,000 1,400
Oilfield Services 1996 95,000 35,000 12,000 1,000
Theo J.M.L. Verhoeff 1998 $189,000 $ 40,000(1) 0 $ 44,000
President, ICO Europe B.V. 1997 151,000 30,000 40,000 42,600
1996 62,000(4) 35,000 10,000 10,300(4)
Jon C. Biro 1998 $131,000 $ 40,000(1) 0 $ 2,500
Senior Vice President 1997 111,000 30,000 30,000 2,200
and Treasurer 1996 78,000 55,000(3) 22,000 3,000
</TABLE>
(1) Consists of a special bonus paid to these officers following a sale of an
equity investment by the Company resulting in the Company recognizing a
pre-tax gain of $11,773,000. The recognition of the gain and the
distribution of the special bonuses occurred during the first quarter of
fiscal 1998. In addition to these executive officers, over 800 other
employees also received special bonuses. During the last three quarters
of the Company's 1998 fiscal year, and through the date of this proxy
statement, executive officers have not received any bonus compensation.
(2) Includes the Company's matching contributions to the Employee Stock
Ownership Plan (the 401(k) Plan) except for Mr. Verhoeff whose "other
compensation" consists of pension plan contributions paid by a
wholly-owned subsidiary of the Company.
(3) Includes a special bonus in the amount of $250,000, $250,000 and $25,000
paid to Ms. S. Pacholder, Dr. Pacholder and Mr. Biro, respectively,
relating to the acquisition of Wedco Technology, Inc.
(4) 1996 compensation includes payments made between May 1, 1996 and
September 30, 1996 after the acquisition of Wedco Technology, Inc. by the
Company on April 30, 1996.
Mr. Verhoeff's annual retirement benefits accrue at a rate of 2% of his
current base salary less Dutch social security entitlements, times
credited service years. Yearly benefits may not exceed 60% of current
base salary less Dutch social security. Mr. Verhoeff currently has 14
years of credited service. The following table indicates the estimated
annual benefits payable, to Mr. Verhoeff, by the insurance company, upon
retirement for specified compensation and years of service under the
pension plan.
9
<PAGE> 13
<TABLE>
<CAPTION>
Remuneration Years of Service
- -------------- ----------------------------------------------------------------------
10 15 20 25 30 35
--------- ---------- ---------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
$ 200,000 $37,000 $56,000 $75,000 $ 93,000 $112,000 $112,000
210,000 39,000 59,000 79,000 98,000 118,000 118,000
220,000 41,000 62,000 83,000 103,000 124,000 124,000
230,000 43,000 65,000 87,000 108,000 130,000 130,000
</TABLE>
EMPLOYMENT AGREEMENTS
The Company has employment agreements with Ms. S. Pacholder, Dr.
Pacholder, Mr. Joseph and Mr. Biro. Ms. S. Pacholder and Dr. Pacholder
originally entered into employment agreements dated April 1, 1995. Mr. Joseph
and Mr. Biro entered into employment agreements with the Company on June 18,
1996 and March 18, 1997, respectively. The base salary of each executive (as set
out above in the Summary Compensation Table) is reviewed at least annually and
is increased from time to time to reflect at a minimum, increases in the cost of
living. Salary increases for each executive are to be consistent with the
increases given to other key executives. Once increased, executive salaries
cannot be reduced. Each executive receives an annual cash bonus in such amount
as is determined by the Board.
The employment agreements for Ms. S. Pacholder and Dr. Pacholder provide
for an initial term of employment through December 31, 2000, and is extended
automatically from day to day until such time as the executive or the Company
gives written notice that automatic extensions shall cease, in which event
employment terminates on a date five years after such notice has been given. The
employment agreements for Mr. Biro and Mr. Joseph provide for an initial term of
employment through September 3, 2000, and is extended automatically from day to
day until such times as the executive or the Company gives written notice that
automatic extensions shall cease, in which event employment terminates on a date
two years after such notice has been given.
If an executive is terminated by the Company for Cause (as defined), the
Company shall pay the executive the full salary through the Date of Termination
(as defined). If the employment of the executive is terminated by the Company
without Cause or by the executive for Good Reason (as defined) within the two
year period following a Change in Control (as defined), except as noted, the
executive will be entitled to receive as a severance payment a lump sum equal to
the sum of the following items: (i) the executive's annual base salary through
the Date of Termination; (ii) the product of (x) the number of days worked in
the year of termination divided by 365, and (y) the greater of half of the
executive's annual base salary in the year of termination or the executive's
highest annual bonus paid during the employment period; and (iii) three times
(two times for Mr. Biro and Mr. Joseph) the sum of (x) the executive's annual
base salary as of the Termination Date and (y) the greater of half of the
executive's annual base salary in the year of termination or the executive's
highest annual bonus paid during the employment period. If it is determined that
any payment made under the employment agreement, or another plan or agreement of
the Company, in the event of a Change of Control, would be considered a payment
as defined in Section 280G of the Code and is subject to excise tax under
Section 4999 of the Code, then the executive would be entitled to an additional
"gross-up payment" that will place the executive in the same after-tax economic
position as if such payment had not been considered an excess parachute payment.
10
<PAGE> 14
OPTIONS GRANTED DURING FISCAL 1998
During the fiscal year ended September 30, 1998, the Named Executives did
not receive additional stock options. 275,000 options were, however, granted to
other employees of the Company.
FISCAL YEAR 1998 OPTION EXERCISES AND FISCAL YEAR-END VALUE
The following table sets forth stock options exercised by the individuals
named in the Summary Compensation Table during fiscal year 1998, and the number
and value of all unexercised options at fiscal year end. The value of
"in-the-money" options refers to options having an exercise price which is less
than the market price of the Company's Common Stock on September 30, 1998.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
SHARES NUMBER OF UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
ACQUIRED VALUE AT SEPTEMBER 30, 1998 SEPTEMBER 30, 1998 (1)
NAME ON EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Sylvia A. Pacholder 0 N/A 167,000 / 0 0 / 0
Asher O. Pacholder 0 N/A 146,000 / 0 0 / 0
Isaac H. Joseph 0 N/A 34,500 / 0 0 / 0
Theo J.M.L. Verhoeff 0 N/A 50,000 / 0 0 / 0
Jon C. Biro 0 N/A 52,500 / 0 0 / 0
</TABLE>
(1) Based upon the $2 9/16 closing market value price of the Company's Common
Stock at September 30, 1998 as reported on the NASDAQ Stock Market.
11
<PAGE> 15
REPORT OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee"),
comprised of three members, is responsible for the Company's compensation
programs. The Committee reviews, evaluates and establishes compensation levels
of corporate officers and administers the Company's employee stock option plans.
The Company's executive compensation programs are designed to help the Company
attract, motivate and retain executive talent. In making compensation decisions,
the Committee also takes into account the cyclicality of the Company's business
lines and progress toward the achievement of strategic Company objectives. The
following summarizes the Committee's compensation programs and policies and
describes the bases for compensation of the Company's executive officers and its
chief executive officer.
CASH COMPENSATION
Base Salary Program. The Company believes that offering competitive rates
of base pay plays an important role in its ability to attract and retain
executive talent. Discretionary base salary adjustments are also made based upon
each individual employee's performance over time. Generally, executive salaries
are reviewed annually based on a variety of factors including individual
performance, market comparisons and the Company's overall financial condition.
Annual Performance Compensation. The Company has historically provided
annual performance compensation in the form of cash bonuses. The Committee's
decisions are typically based upon the performance and financial condition of
the Company and subjective factors including the executive officer's job
performance and achievements during the Company's fiscal year. At times, special
bonuses may be awarded related to specific material events which required
extraordinary effort on the part of the executive officer.
LONG-TERM COMPENSATION
Stock Options. Longer-term incentives, in the form of stock options, are
designed to directly link a significant portion of the executive's compensation
to the enhancement of shareholder value. Additionally, stock options encourage
management to focus on longer-term objectives along with annual operating
performance. The Committee believes that stock incentives are appropriate, not
only for senior management, but also for other employees of the Company and its
subsidiaries. All options provide for purchases of shares at an exercise price
equal to fair market value on the date of grant. Accordingly, the Committee,
from time to time, grants stock options to the Company's executive officers. The
number of options is determined based upon the level and contribution of a given
employee and may take into account the number of options previously granted to
the employee. In the past, the Committee has generally granted incentive stock
options under the Company's plans.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
In determining the fiscal year 1998 compensation paid to the Company's
Chief Executive Officer, the Committee took into account the executive's
abilities, business experience and performance during the past fiscal year. The
Committee's assessment of the Chief Executive Officer's performance included the
areas of corporate acquisitions, continued revenue growth and the executive's
extraordinary contribution to consummating the sale of an equity investment
owned by the Company, which resulted in the Company recognizing a pre-tax gain
of $11,773,000. The Committee also compared the compensation levels of the
Company's Chief Executive Officer to the compensation levels of chief executive
officers of companies of similar size as well as companies operating in the
oilfield service and specialty chemical industries. The companies with which
these comparisons were made were not necessarily the same as the companies
included in the oilfield service and specialty chemical indices utilized in the
performance graph.
12
<PAGE> 16
COMPENSATION DEDUCTION LIMITATION
Section 162(m) of the Internal Revenue Code imposes a limitation on the
deductibility of nonperformance- based compensation in excess of $1 million paid
to Named Executive officers. The Committee currently believes that the Company
should be able to continue to manage its executive compensation program for
Named Executive Officers so as to preserve the related federal income tax
deductions.
SUMMARY
The Committee believes that the Company's executive compensation policies
and programs serve the interests of the stockholders and the Company
effectively. The various compensation programs are believed appropriately
balanced to provide motivation for executives to contribute to the Company's
overall success and enhance the value of the Company for the stockholders'
benefit. The Committee will continue to monitor the effectiveness of the
Company's compensation programs and will make changes, when appropriate, to meet
the current and future needs of the Company.
COMPENSATION COMMITTEE
William E. Cornelius
William J. Morgan
John F. Williamson
13
<PAGE> 17
STOCK PERFORMANCE CHART (1)
The following chart compares the yearly percentage change in the
cumulative total Shareholder return of the Company's common stock during the
five years ended September 30, 1998 with: (1) the cumulative total return of the
NASDAQ Composite Stock Index (U.S.); (2) an index of 21 oil service companies
(Value Line's Oilfield Services and Equipment Industry Index); and (3) an index
of 38 specialty chemical companies (Value Line's Specialty Chemical Industry
Index). The prior years' stock performance chart included a comparison to a
market capitalization group and Tuboscope, Inc., a competitor of the Company in
its oilfield service business. This proxy statement, prepared for the 1999
annual meeting, presents a specialty chemical index, which the Company believes
is more useful, instead of the market capitalization group. The comparison with
Tuboscope, Inc. has been eliminated due to the change in the relative mixture of
the Company's revenues. Had the graph below presented the market capitalization
group presented in the prior years' proxy statement, the plot points for 1993
through 1998, for this group, would have been 100, 76, 103, 86, 113, and 83,
respectively.
STOCK PERFORMANCE CHART
<TABLE>
<CAPTION>
1993 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
ICO 100.00 54.05 52.70 64.53 90.89 31.36
Oilfield Services Index 100.00 91.76 109.13 166.70 362.81 240.99
NASDAQ 100.00 100.83 139.28 165.24 226.81 231.74
Specialty Chemicals Index 100.00 112.62 137.62 162.41 215.10 185.78
</TABLE>
(1) Assumes $100 invested on September 30, 1993 and all dividends reinvested.
Data supplied by NASDAQ and Value Line Institutional Services.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors of the Company
currently consists of Messrs. William J. Morgan, William E. Cornelius, and John
F. Williamson.
Dr. Pacholder and Mr. Morgan are each Directors of the Company and are
directors and executive officers of Pacholder Associates, Inc. and are parties
to a Shareholders' Agreement described under "Security Ownership of Certain
Beneficial Owners of More than 5% of Outstanding Stock."
14
<PAGE> 18
CERTAIN TRANSACTIONS
In connection with the April 30, 1996 merger of Wedco Technology, Inc.
into a wholly-owned subsidiary of the Company, Wedco and William E. Willoughby
entered into a ten-year non-compete agreement and a five-year consulting
agreement. As consideration, Mr. Willoughby will receive $300,000 payable in 60
equal monthly installments for the non-compete agreement and $240,000 per year,
payable monthly, for consulting services. Mr. Willoughby and Wedco are also
parties to a salary continuation agreement which provides that Mr. Willoughby's
spouse will be paid a survivorship benefit of $150,000 for five years if Mr.
Willoughby predeceases his spouse at a time when he is serving as a consultant
to Wedco or the Company, provided, however, such payment shall terminate upon
the earlier to occur of the death of his spouse or April 30, 2001. Tom D.
Pacholder, son of Ms. Sylvia Pacholder and Dr. Asher Pacholder, is Vice
President-Corporate Development of Wedco. Mr. Pacholder, who has a Master's
Degree from the University of Dayton, received $84,000 in compensation during
fiscal 1998.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 (as amended, the
"Exchange Act") requires the Company's Officers and Directors, and persons who
own more than 10% of a registered class of the Company's equity securities, to
file reports of ownership and changes in ownership with the Securities and
Exchange Commission and NASDAQ and to furnish the Company with copies of all
reports filed. Based solely on the review of the reports furnished to the
Company, the Company believes that, during fiscal 1998, all Section 16(a) filing
requirements applicable to its Directors, officers and greater than 10%
beneficial owners were met, except for Mr. William E. Willoughby's untimely
reporting of two sales totaling 20,000 common shares during September of 1998,
which required a Form 4 filing. Additionally, two purchase transactions by Mr.
Leib totaling 2,000 common shares, during September of 1998, required a Form 4
filing and were untimely reported. Mr. Willoughby and Mr. Leib have now reported
the above transactions.
PROPOSAL TO APPROVE THE SECOND AMENDMENT AND RESTATEMENT OF THE
1993 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
On April 13, 1993, the Board of Directors adopted, subject to Shareholder
approval, the Company's 1993 Stock Option Plan for Non-employee Directors. The
Company's Shareholders approved the 1993 Director Plan at the 1993 Shareholders'
Meeting. The Board of Directors approved the first amendment and restatement of
the 1993 Director Plan on August 29, 1996 and the Company's Shareholders
approved the first amendment and restatement of the plan at the 1997
Shareholders' Meeting (as so amended, the "1993 Director Plan"). The Board of
Directors approved the second amendment and restatement of the 1993 Director
Plan on January 8, 1999. A copy of the Second Amended and Restated 1993 Director
Plan is attached hereto as Exhibit "A". The summary description of the 1993
Director Plan is qualified by reference to the full plan in Exhibit A.
GENERAL
The purpose of the 1993 Director Plan is to provide an additional
incentive to attract and retain qualified and competent directors, upon whose
efforts and judgment the success of the Company is largely dependent, through
the encouragement of stock ownership in the Company by such persons. In
furtherance of this purpose, the 1993 Director Plan authorizes the granting of
stock options ("Director Options") to purchase Common Stock to such non-employee
Directors. Director Options granted to non-employee Directors will be in
addition to, and not in lieu of, other benefits received by Directors.
Each non-employee Director eligible to participate in the 1993 Director
Plan currently receives, on the first business day after the date of each annual
Meeting of Shareholders of the Company, an option to purchase 5,000 shares of
Common Stock at the exercise price per share equal to 100% of the fair market
value of the Common Stock on the date of grant. Fair market value is the closing
price (which in the case of shares quoted on NASDAQ is the mean between the
closing high bid and low asked quotations for such day) on the business day
immediately preceding such day. Each option expires ten (10) years after the
date of grant.
15
<PAGE> 19
In addition, the 1993 Director Plan provides that any non-employee
Director of the Company who is elected to the Board of Directors at other than
an Annual Meeting of Shareholders, will be granted an option for 5,000 shares of
Common Stock on the date such non-employee Director is so elected as a Director,
at the exercise price of 100% of the fair market value of the Common Stock on
the date such non-employee Director is elected.
A total of 160,000 shares of Common Stock were reserved for issuance upon
exercise of options granted pursuant to the 1993 Director Plan (proposed to be
amended to 310,000 shares). Currently, 158,000 options have been granted under
the 1993 Director Plan, leaving 2,000 options available for grant.
The 1993 Director Plan is administered by the Compensation Committee,
which is presently comprised of Messrs. Cornelius, Morgan, and Williamson.
The 1993 Director Plan currently provides for a termination date of April
13, 2003. Such date is proposed to be extended until January 8, 2009.
TERMS AND CONDITIONS OF OPTIONS
An option may be exercised six months and one day after the date of grant.
The exercise price of an option may be paid in cash, certified or
cashier's check, money order or by delivery of already-owned shares of Common
Stock having a fair market value equal to the exercise price, or by delivery of
a combination of the above.
Options previously granted or to be granted may be transferred by will or
laws of descent and distribution or at the discretion of the Compensation
Committee.
An option shall terminate on the earliest to occur of (i) thirty (30) days
after the date that an Optionee ceases to be a Director regardless of the reason
therefor other than as a result of such termination by death of the Optionee;
(ii) one year after the date that an Optionee ceases to be a Director by reason
of death of the Optionee, or six months after the Optionee shall die if that
shall occur during such thirty-day period described in (i); or (iii) the tenth
(10th) anniversary of the date of grant of the option.
To prevent dilution of the rights of a holder of an option, the 1993
Director Plan provides for the adjustment of (i) the number of shares upon which
options may be granted; (ii) the number of shares subject to outstanding
options; and (iii) the exercise price of an option, in the event of any
subdivision or consolidation of shares of Common Stock, any stock dividend,
recapitalization or other capital adjustment.
FEDERAL INCOME TAX CONSEQUENCES
The grant of an option will not be taxable to an optionee. Generally, upon
the exercise of an option, an optionee will recognize ordinary income at the
time of exercise equal to the excess of the then fair market value of the shares
of Common Stock received over the exercise price. The Company will not be
entitled to a deduction for federal income tax purposes for the granting of an
option, but will be entitled to a deduction that corresponds as to timing and
amount with the income recognized by the optionee. The optionee will generally
have a tax basis in any shares of Common Stock received pursuant to the exercise
of an option equal to the fair market value of such shares on the date of
exercise. When the shares of Common Stock received upon the exercise of an
option subsequently are disposed of in a taxable transaction, the optionee
generally will recognize capital gain (or loss) in the amount by which the
amount realized exceeds (or is less than) the fair market value of the Common
Stock on the date the option was exercised; such capital gain or loss will be
long-term or short-term, depending upon the optionee's holding period following
the exercise of the options.
16
<PAGE> 20
PROPOSED AMENDMENTS
The 1993 Director Plan is proposed to be amended and restated primarily to
(i) increase the number of shares subject to options which can be granted under
the 1993 Director Plan from 160,000 to 310,000 shares; (ii) extend the term of
the plan until 2009, as described above; (iii) make certain appropriate or
conforming changes in dates and clarify certain actions previously taken in
connection with the 1993 Director Plan; and (iv) make certain changes to conform
to amendments in Rule 16b-3 under the Securities Exchange Act of 1934, as
amended.
The following table describes the benefits that would be received in a
grant made for a single fiscal year by the eligible Directors under the 1993
Director Plan, assuming certain values set forth in the footnotes to the table.
The Executive Officers as a group and all non-executive employees as a group
would not receive any benefits under the 1993 Director Plan. Messrs. Morgan,
Cornelius, Williamson, Leib, Willoughby, Sirusas, and Gibson are the only
individuals presently entitled to receive benefits under the 1993 Director Plan.
<TABLE>
<CAPTION>
POTENTIAL REALIZED VALUE (*/SHARE) AT ASSUMED ANNUAL
RATES OF STOCK PRICE APPRECIATION FOR OPTION TERM
-----------------------------------------------------
Options to be Granted
Plan Name in Fiscal 1999 0% 5% 10%
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1993 Director Plan 35,000 $0 $45,000 $115,000
</TABLE>
*The market value of the Common Stock on January 15, 1999 was $2 1/16 per share
and was the assumed exercise price for the options. Neither the dollar value of
the option nor the benefits or amounts which would have been received by or
allocated to the last fiscal year are determinable.
APPROVAL
In order to approve the proposal to amend and restate the 1993 Director
Plan, the Company is seeking the approval by the holders of a majority of the
outstanding shares of Common Stock represented at the 1999 Annual Meeting, which
is the approval generally required for amendments to the 1993 Director Plan.
Proxies will be voted for or against such proposal in accordance with the
specification marked thereon, and, if no specification is made, will be voted in
favor of such proposal. An abstention and/or a broker non-vote would have the
same legal effect as a vote against this proposal.
The Board of Directors believes that the 1993 Director Plan benefits the
Company and its Shareholders by further aligning long-term interests of the
non-employee Directors with those of the Shareholders. The Board of Directors
also believes that grants under the plan are a favorable method to the Company
for compensating the recipients for past contributions to the Company's success,
as well as for anticipated contributions in the future. The Board, therefore,
recommends a vote FOR approval of the amendment and restatement of the 1993
Director Plan.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP has served as auditors for the Company for the
fiscal year ended September 30, 1998. Neither such firm nor any of its
associates has any relationship with the Company except in their capacity as
auditors. A representative of PricewaterhouseCoopers LLP is expected to attend
the 1999 Annual Meeting and will be available to respond to appropriate
questions raised during the meeting by shareholders. Such representative will
have the opportunity to make a statement during the meeting if he so desires.
The audit of the Company's financial statements for the 1998 fiscal year
has just been concluded, and there has not been sufficient time for the Company
to evaluate whether to retain PricewaterhouseCoopers LLP as auditors for the
fiscal year ending September 30, 1999. While the Company currently expects to
retain PricewaterhouseCoopers LLP to serve as auditors for the fiscal year 1999,
any such decision will be made in light of the Company's ongoing cost reduction
efforts, and, therefore, a final decision has not been made.
17
<PAGE> 21
INFORMATION CONCERNING SHAREHOLDER PROPOSALS
Rule 14a-8 under the Securities Exchange Act of 1934, as amended,
addresses when a company must include a shareholder's proposal in its proxy
statement and identify the proposal in its form of proxy when the company holds
an annual or special meeting of shareholders. Under Rule 14a-8, proposals that
shareholders intend to have included in the Company's proxy statement and form
of proxy for the 2000 Annual Meeting of Shareholders must be received by the
Company no later than September 29, 1999. However, if the date of the 2000
Annual Meeting of Shareholders changes by more than 30 days from the date of the
1999 Annual Meeting of Shareholders, the deadline is a reasonable time before
the Company begins to print and mail its proxy materials, which deadline will be
set forth in a Quarterly Report on Form 10-Q or will otherwise be communicated
to shareholders. Shareholder proposals must also be otherwise eligible for
inclusion.
If a shareholder desires to bring a matter before an annual meeting and
the proposal is submitted outside the process of Rule 14a-8, the shareholder
must follow the procedures set forth in the Company's Bylaws. The Company's
Bylaws provide generally that shareholders who wish to nominate directors or to
bring business before an annual meeting must notify the Company and provide
certain pertinent information at least 90 days prior to the anniversary date of
the immediately preceding annual meeting of shareholders. Therefore,
shareholders who wish to nominate directors or to bring business before the 2000
Annual Meeting of Shareholders must notify the Company no later than December 8,
1999.
OTHER MATTERS WHICH MAY COME BEFORE THE ANNUAL MEETING
The Company knows of no matters other than those stated above which are to
be brought before the Annual Meeting. It is intended that the persons named in
the Proxy will vote your stock according to their best judgment if any other
matters do properly come before the Meeting.
Whether or not you intend to be present at this meeting, you are urged to
return this Proxy promptly. If you are present at the meeting and wish to vote
your stock in person, this Proxy shall, at your request, be returned to you at
the meeting.
By Order of the Board of Directors
Asher O. Pacholder Sylvia A. Pacholder
Chairman of the Board and Chief Executive Officer,
Chief Financial Officer President & Secretary
Dated: January 25, 1999
18
<PAGE> 22
EXHIBIT "A"
SECOND AMENDED AND RESTATED
1993 STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
OF
ICO, INC.
1. Purpose. The purpose of this Plan is to advance the interests of ICO,
Inc., a Texas corporation (the "Company"), by providing an additional
incentive to attract and retain qualified and competent Directors, upon
whose efforts and judgment the success of the Company is largely
dependent, through the encouragement of stock ownership in the Company
by such persons.
2. Definitions. As used herein, the following terms shall have the meaning
indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Committee" shall mean those members of the Board who are not
Eligible Persons.
(c) "Date of Grant" shall mean the date on which an Option is granted
to an Eligible Person pursuant to Section 4(c) hereof.
(d) "Director" shall mean a member of the Board.
(e) "Eligible Person(s)" shall mean those persons who are Directors of
the Company and who are not employees or officers of the Company or
a Subsidiary.
(f) "Fair Market Value" of a Share on any date of reference shall be
the Closing Price on the business day immediately preceding such
date. For this purpose, the Closing Price of the Shares on any
business day shall be (i) if the Shares are listed or admitted for
trading on any United States national securities exchange, the last
reported sale price of Shares on such exchange, as reported in any
newspaper of general circulation, (ii) if Shares are quoted on
NASDAQ, or any similar system of automated dissemination of
quotations of securities prices in common use, the mean between the
closing high bid and low asked quotations for such day of Shares on
such system, (iii) if neither clause (i) or (ii) is applicable, the
mean between the high bid and low asked quotations for Shares as
reported by the National Daily Quotation Service if at least two
securities dealers have inserted both bid and asked quotations for
Shares on at least five of the ten preceding business days, or (iv)
in lieu of the above, if actual transactions in the Shares are
reported on a consolidated transaction reporting system, the last
sales price of the Shares on such system. If there is no Closing
Price as determined above, the Fair Market Value shall be
determined by any fair and reasonable means prescribed by the
Committee.
(g) "Internal Revenue Code" or "Code" shall mean the Internal Revenue
Code of 1986, as it now exists or as it may be amended from time to
time.
(h) "Non-incentive Stock Option" shall mean an option that is not an
incentive stock option as defined in Section 422A of the Internal
Revenue Code.
(i) "Option" (when capitalized) shall mean any option granted under
this Plan.
(j) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any successor to the rights of such person under
this Plan by reason of the death of such person.
(k) "Plan" shall mean this 1993 Stock Option Plan for Non-employee
Directors of ICO, Inc., as amended
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<PAGE> 23
and restated August 29, 1996, and as amended and restated January
8, 1999.
(l) "Share(s)" shall mean a share or shares of the Common Stock, no par
value, of the Company.
(a) "Subsidiary" shall mean any corporation (other than the Company) in
any unbroken chain of corporations beginning with the Company if,
at the time of the granting of the Option, each of the corporations
other than the last corporation in the unbroken chain owns stock
possessing more than 50% of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
3. Shares and Options. The maximum number of Shares to be issued pursuant
to Options under this Plan shall be THREE HUNDRED TEN THOUSAND
(310,000) Shares, such number having been adjusted for all previous
stock splits, from Shares held in the Company's treasury or from
authorized and unissued Shares. If any Option granted under this Plan
shall terminate, expire, or be canceled or surrendered as to any
Shares, new Options may thereafter be granted covering such Shares. Any
Option granted hereunder shall be a Non- incentive Stock Option.
4. Automatic Grant of Options.
(a) Options shall automatically be granted to Eligible Persons as
provided in this Section 4. Each Option shall be evidenced by an
option agreement (an "Option Agreement") and shall contain such
terms as are not inconsistent with this Plan or any applicable law.
Any person who files with the Board, in a form satisfactory to the
Board, a written waiver of eligibility to receive any Option under
this Plan shall not be eligible to receive any Option under this
Plan for the duration of such waiver.
(b) The Options automatically granted to Directors under this Plan
shall be in addition to regular Director's fees or other benefits
with respect to the Director's position with the Company or its
subsidiaries. Neither the Plan nor any Option granted under the
Plan shall confer upon any person any right to continue to serve as
a Director.
(c) Options shall be automatically granted as follows:
(i) each Director who is an Eligible Person on the first business
day after the date of the 1999 Annual Meeting of Shareholders
of the Company, on that date shall automatically receive an
Option for FIVE THOUSAND (5,000) Shares, such date being the
Date of Grant of such Option;
(ii) each Director who is an Eligible Person on the first business
day after the date of each subsequent Annual Meeting of
Shareholders of the Company, commencing with the Annual
Meeting of Shareholders held in 2000, on that date shall
automatically receive an Option for FIVE THOUSAND (5,000)
Shares, such date being the Date of Grant of such Option; and
(ii each Eligible Person who is elected a Director by the
Company's Shareholders or the Board of Directors (not
previously being a Director) on a date other than the date of
the Annual Meeting of Shareholders of the Company shall be
granted an Option for FIVE THOUSAND (5,000) Shares on the
date of such Eligible Person's election as a Director, such
date being the Date of Grant for such Option.
(d) Any Option that may be granted pursuant to subparagraph (c) may be
exercised six months and one day after the Date of Grant.
Notwithstanding the foregoing sentence, no Option shall be
exercisable until six months after the Company's Shareholders
approve the Plan.
(e) Except for the automatic grants of Options under subparagraph (c)
of this Section 4, no Options shall otherwise be granted hereunder.
5. Option Price. The option price per Share of any Option shall be one
hundred percent (100%) of the Fair Market Value per Share on the Date
of Grant.
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<PAGE> 24
6. Exercise of Options. An Option shall be deemed exercised when (i) the
Company has received written notice of such exercise in accordance with
the terms of the Option Agreement, (ii) full payment of the aggregate
Option Price of the Shares as to which the Option is exercised has been
made, and (iii) arrangements that are satisfactory to the Committee in
its sole discretion have been made for the Optionee's payment to the
Company of the amount, if any, that the Committee determines to be
necessary for the Company to withhold in accordance with applicable
federal or state income tax withholding requirements. Pursuant to
procedures approved by the Committee, tax withholding requirements, at
the option of an Optionee, may be met by withholding Shares otherwise
deliverable to the Optionee upon the exercise of an Option. Unless
further limited by the Committee in any Option Agreement, the Option
Price of any Shares purchased shall be paid solely in cash, by
certified or cashier's check, by money order, with Shares (but with
Shares only if permitted by the Option Agreement or otherwise permitted
by the Committee in its sole discretion at the time of exercise) or by
a combination of the above; provided, however, that the Committee in
its sole discretion may accept a personal check in full or partial
payment of any Shares. If the exercise price is paid in whole or in
part with Shares, the value of the Shares surrendered shall be their
Fair Market Value on the date received by the Company. Any permitted
payment through the tender of Shares may be made by instruction from
the Optionee to the Company to withhold from the Shares issuable upon
exercise that number which have a Fair Market Value equal to the
exercise price for the Option or portion thereof being exercised.
7. Termination of Option Period. The unexercised portion of an Option
shall automatically and without notice terminate and become null and
void at the time of the earliest to occur of the following:
(i) thirty (30) days after the date that an Optionee ceases to
be a Director regardless of the reason therefor other than
as a result of such termination by death of the Optionee;
(ii) one year after the date that an Optionee ceases to be a
Director by reason of death of the Optionee, or six months
after the Optionee shall die if that shall occur during
the thirty-day period described in Subsection 7(i); or
(iii) the tenth (10th) anniversary of the Date of Grant of the
Option.
8. Adjustment of Shares.
(a) If at any time while this Plan is in effect or unexercised Options
are outstanding, there shall be any increase or decrease in the
number of issued and outstanding Shares through the declaration of
a stock dividend or through any recapitalization resulting in a
stock split-up, combination or exchange of Shares, then and in such
event:
(i) appropriate adjustment shall be made in the maximum number
of Shares then subject to being optioned under the Plan,
so that the same proportion of the Company's issued and
outstanding Shares shall continue to be subject to being
so optioned; and
(ii) appropriate adjustment shall be made in the number of
Shares and the exercise price per Share thereof then
subject to any outstanding Option, so that the same
proportion of the Company's issued and outstanding Shares
shall remain subject to purchase at the same aggregate
exercise price.
(b) Except as otherwise expressly provided herein, the issuance by the
Company of Shares of its capital stock of any class, or securities
convertible into Shares of capital stock of any class, either in
connection with a direct sale or upon the exercise of rights or
warrants to subscribe therefor, or upon conversion of Shares or
obligations of the Company convertible into such Shares or other
securities, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number of or exercise price of
Shares then subject to outstanding Options granted under this Plan.
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<PAGE> 25
(c) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under this Plan shall not affect in any
manner the right or power of the Company to make, authorize or
consummate (1) any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure
or its business; (2) any merger or consolidation of the Company;
(3) any issue by the Company of debt securities, or preferred or
preference stock which would rank above the Shares subject to
outstanding Options; (4) the dissolution or liquidation of the
Company; (5) any sale, transfer or assignment of all or any part of
the assets or business of the Company; or (6) any other corporate
act or proceeding, whether of a similar character or otherwise.
9. Transferability of Options. Each Option Agreement shall provide that
such Option shall not be transferable by the Optionee other than by
will or by the laws of descent and distribution provided, however, that
the Committee, in its sole discretion may allow for the transferability
of any option previously granted or to be granted pursuant to this
Plan.
10. Issuance of Shares. No person shall be, or have any of the rights or
privileges of, a Shareholder of the Company with respect to any of the
Shares subject to an Option, unless and until certificates representing
such Shares shall have been issued and delivered to such person. As a
condition of any transfer of the certificate for Shares, the Committee
may obtain such agreements or undertakings, if any, as it may deem
necessary or advisable to assure compliance with any provision of this
Plan, any Option Agreement or any law or regulation including, but not
limited to, the following:
(i) a representation, warranty or agreement by the Optionee to the
Company, at the time any Option is exercised, that he or she is
acquiring the Shares to be issued to him or her for investment and
not with a view to, or for sale in connection with, the
distribution of any such Shares; and
(ii) a representation, warranty or agreement to be bound by any legends
that are, in the opinion of the Committee, necessary or
appropriate to comply with the provisions of any securities law
deemed by the Committee to be applicable to the issuance of the
Shares and are endorsed upon the Share certificates.
Share certificates issued to an Optionee who is a party to any
Shareholders agreement or a similar agreement shall bear the legends
contained in such agreements.
11. Amendment, Modification, Suspension or Discontinuance of this Plan. The
Board of Directors may amend, modify, suspend or terminate the Plan for
the purpose of meeting or addressing any changes in legal requirements
or for any other purpose permitted by law. Subject to changes in law or
other legal requirements, including any change in the provisions of
Rule 16b-3 and Section 162(m) of the Code that would permit otherwise,
the Plan may not be amended without the consent of the holders of a
majority of the Shares of stock represented at a meeting of
Shareholders for which a quorum is present, to (i) increase materially
the aggregate number of Shares of stock that may be issued under the
Plan (except for adjustments pursuant to paragraph 8 of the Plan), (ii)
increase materially the benefit accruing to Optionees under the Plan,
or (iii) modify materially the requirements as to eligibility for
participation in the Plan.
12. Interpretation.
(a) If any provision of this Plan is held to be invalid for any reason,
such holding shall not affect the remaining provisions hereof, but
instead this Plan shall be construed and enforced as if such
provision had never been included in this Plan.
(b) THIS PLAN SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS.
(c) Headings contained in this Plan are for convenience only and shall
in no manner be construed as part of this Plan.
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<PAGE> 26
(d) Any reference to the masculine, feminine, or neuter gender shall be
a reference to such other gender as is appropriate.
13. Section 83(b) Election. If as a result of exercising an Option, an
Optionee receives Shares that are subject to a "substantial risk of
forfeiture" and are not "transferable" as those terms are defined for
purposes of Section 83(a) of the Code, then such Optionee may elect
under Section 83(b) of the Code to include in his gross income, for his
taxable year in which the Shares are transferred to him, the excess of
the Fair Market Value of such Shares at the time of transfer
(determined without regard to any restriction other than one which by
its terms will never lapse), over the amount paid for the Shares. If
the Optionee makes the Section 83(b) election described above, the
Optionee shall (i) make such election in a manner that is satisfactory
to the Committee, (ii) provide the Company with a copy of such
election, (iii) agree to promptly notify the Company if any Internal
Revenue Service or state tax agent, on audit or otherwise, questions
the validity or correctness of such election or of the amount of income
reportable on account of such election, and (iv) agree to such
withholding as the Committee may reasonably require in its sole and
absolute discretion.
14. Effective Date and Termination Date; Adoption of Plan. The effective
date of this Plan is the 13th day of April, 1993, the date on which the
Board originally adopted this Plan. The Shareholders of the Company
approved the Plan on June 15, 1993. The Plan was subsequently amended
and restated by the Board on August 29, 1996, which amendment and
restatement was approved by the Shareholders on October 7, 1996. In
connection with the corporate restructuring effected on April 1, 1998,
pursuant to a Plan of Merger of ICO Merger Sub, Inc. with and into ICO,
Inc., the Company (which prior to such merger was named "ICO Holdings,
Inc.") adopted the Plan and assumed the obligations under the Plan from
the entity previously named "ICO, Inc." (which after such merger was
renamed "ICO P&O, Inc."). The Plan was again amended and restated by
the Board on January 8, 1999. This Plan shall terminate on January 8,
2009, subject to early termination by the Board pursuant to Paragraph
11 of the Plan.
15. Government Regulations. The Plan, and the granting and exercise of
Options thereunder, and the obligation of the Company to sell and
deliver shares under such Options, shall be subject to all applicable
laws, rules and regulations, and to such approvals by any governmental
agencies or national securities exchanges as may be required.
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<PAGE> 27
ICO, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY FOR ANNUAL MEETING MARCH 8, 1999
The undersigned hereby appoints Asher O. Pacholder and Sylvia A. Pacholder,
or any one of them, proxies of the undersigned, each with the power of
substitution, to vote all shares of common stock which the undersigned
P would be entitled to vote at the Annual Meeting of Shareholders of ICO,
Inc. to be held in Houston, Texas on Monday, March 8, 1999, and any
R adjournment of such meeting on the matters specified and in their
discretion with respect to such other business as may properly come before
O the meeting or any adjournment thereof.
X THIS PROXY, WHEN PROPERLY EXECUTED WILL BE (change of address)
VOTED IN THE MANNER DIRECTED HEREIN. IN
Y THE ABSENCE OF SPECIFIC DIRECTIONS TO THE
CONTRARY (INDICATED BY MARKING THE APPROPRIATE ------------------------
BOXES ON THE REVERSE HEREOF), THIS PROXY WILL
BE VOTED FOR THE ELECTION OF EACH OF THE ------------------------
DIRECTOR NOMINEES AND FOR THE APPROVAL OF
THE SECOND AMENDMENT AND RESTATEMENT OF THE ------------------------
1993 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN.
------------------------
-----------
SEE REVERSE
SIDE
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<PAGE> 28
ICO, INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]
The Board of Directors recommends a vote FOR proposals 1 and 2.
<TABLE>
<CAPTION>
FOR WITHHELD FOR except vote withheld
ALL ALL from the following nominees:
<S> <C> <C> <C>
1. Election of Directors
Nominees: William J. Morgan, Sylvia A. Pacholder and [ ] [ ] [ ]
William E. Willoughby. ---------------------
(terms to expire at 2002 Annual Meeting of Stockholders) Nominee Exceptions
FOR AGAINST ABSTAIN
2. The approval of the second amendment and restatement of the
1993 non-employee directors stock option plan which includes [ ] [ ] [ ] 3. With discretionary authority
increasing the number of shares of Common Stock issuable as to such other matters as
under the plan from 160,000 to 310,000 shares. may properly come before the
meeting.
---------------------------------------
Signature(s) Date
---------------------------------------
Signature(s) Date
NOTE: Please sign exactly as name
appears hereon. Joint owners
should each sign. When signing
as attorney, executor,
administrator, trustee or
guardian, please give your full
title as such.
</TABLE>
Please sign, date and return the Proxy Card promptly,
using the enclosed envelope.
