<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
GENTEX CORPORATION
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
GENTEX CORPORATION
- - --------------------------------------------------------------------------------
(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:
- - --------------------------------------------------------------------------------
(5) Total fee paid:
- - --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- - --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
- - --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- - --------------------------------------------------------------------------------
(3) Filing party:
- - --------------------------------------------------------------------------------
(4) Date filed:
- - --------------------------------------------------------------------------------
<PAGE> 2
[GENTEX CORPORATION LETTERHEAD]
NOTICE OF 1999 ANNUAL MEETING
- - --------------------------------------------------------------------------------
The Annual Meeting of the Shareholders of Gentex Corporation, a
Michigan corporation, will be held at the Hilton Hotel, 28th at Patterson
Street, Grand Rapids, Michigan, on Thursday, May 20, 1999, at 4:30 p.m.
E.D.S.T., for the following purposes:
1. To elect three directors as set forth in the Proxy Statement.
2. To transact any other business that may properly come before the
meeting.
Shareholders of record as of the close of business on March 26, 1999,
are entitled to notice of, and to vote at the meeting. You are requested to
sign, date, and return the accompanying Proxy in the enclosed, self-addressed
envelope, regardless of whether you expect to attend the meeting in person. You
may withdraw your Proxy at the meeting if you are present and desire to vote
your shares in person.
BY ORDER OF THE BOARD OF DIRECTORS
Connie Hamblin
Secretary
April 12, 1999
<PAGE> 3
[GENTEX CORPORATION LETTERHEAD]
PROXY STATEMENT FOR ANNUAL MEETING
OF SHAREHOLDERS TO BE HELD MAY 20, 1999
SOLICITATION OF PROXIES
This Proxy Statement is being furnished on or about April 12, 1999, to
the shareholders of Gentex Corporation in connection with the solicitation by
the Board of Directors of the Corporation of Proxies to be used at the Annual
Meeting of Shareholders to be held on Thursday, May 20, 1999, at 4:30 p.m.
E.D.S.T. at the Hilton Hotel, 28th at Patterson Street, Grand Rapids, Michigan.
If the form of Proxy accompanying this Proxy Statement is properly
executed and returned to the Company, the shares represented by the Proxy will
be voted at the Annual Meeting of Shareholders in accordance with the directions
given in the Proxy, unless the Proxy is revoked. Any shareholder executing and
returning the form of Proxy which accompanies this Proxy Statement may revoke
the Proxy, at any time before it has been exercised, by delivering a written
notice of revocation to the Secretary of the Company, executing a subsequent
proxy or attending the meeting and voting in person.
The cost of the solicitation of Proxies will be borne by the Company.
In addition to the use of the mails, Proxies may be solicited personally or by
telephone or facsimile by a few regular employees of the Company without
additional compensation. The Company does not intend to pay any compensation for
the solicitation of Proxies, except that brokers, nominees, custodians, and
other fiduciaries will be reimbursed by the Company for their expenses in
connection with sending proxy materials to beneficial owners and obtaining their
Proxies.
VOTING SECURITIES AND RECORD DATE
March 26, 1999, has been fixed by the Board of Directors as the record
date for determining shareholders entitled to vote at the Annual Meeting. On
that date, 72,606,826 shares of the Company's common stock, par value $.06 per
share, were issued and outstanding. Shareholders are entitled to one vote for
each share of the Company's common stock registered in their names at the close
of business on the record date.
ELECTION OF DIRECTORS
The Company's Articles of Incorporation specify that the Board of
Directors shall consist of at least six but not more than nine members, with the
exact number to be determined by the Board. The Board has fixed the number of
directors at seven. The Articles of Incorporation also specify that the Board of
Directors be divided into three classes, with the classes to hold office for
staggered terms of three years each. Arlyn Lanting, Kenneth La Grand and Ted
Thompson are incumbent directors previously elected by shareholders, and they
are nominees for re-election to a three-year term expiring in 2002.
Unless otherwise directed by a shareholder's marking on the Proxy card,
the persons named as proxy voters in the accompanying Proxy will vote for the
nominees described below. In the event any of these nominees is no longer a
candidate at the time of the Annual Meeting of Shareholders (a situation which
is not now anticipated), the Board of Directors may designate a substitute
nominee, in which case the accompanying Proxy will be voted for the substituted
nominee.
1
<PAGE> 4
Under Michigan law, directors are elected by a plurality of the votes
cast by shareholders. Therefore, the three nominees who receive the largest
number of affirmative votes will be elected, irrespective of the number of votes
received. Broker nonvotes, votes withheld, and votes cast against any nominee
will not have a bearing on the outcome of the election. Votes will be counted by
Inspectors of Election appointed by the presiding officer at the Annual Meeting.
The Board of Directors recommends a vote FOR the election of all three
persons nominated by the Board.
The content of the following table relating to business experience is
based upon information furnished to the Company by the nominees and directors.
NAME, (AGE) BUSINESS EXPERIENCE
AND POSITION PAST FIVE YEARS
- - --------------------------------------------------------------------------------
NOMINEES FOR TERMS TO EXPIRE IN 2002
Arlyn Lanting (58) Mr. Lanting is the Vice President
Director since 1981 -- Finance of Aspen Enterprises,
Ltd., Grand Rapids, MI (real estate
investments), and he has held that
position for more than five years.
Kenneth La Grand (58) Mr. La Grand is the Executive Vice
Director since 1987 President of Gentex Corporation, and
he has held that position for more
than five years.
Ted Thompson (69) Mr. Thompson is the Chairman and
Director since 1987 Chief Executive Officer of X-Rite,
Incorporated, Grandville, MI (a
manufacturer of light and
color-measuring instruments), and he
has held that position for more than
five years. Mr. Thompson is also a
director of X-Rite, Incorporated.
DIRECTORS WHOSE TERMS EXPIRE IN 2001
Mickey Fouts (67) Mr. Fouts has been Chairman of the
Director since 1982 Board, Equity Services Company
(investment services), Castle Rock,
CO, for more than five years. In
addition, he was Chairman of the
Board and interim C.E.O. of American
Consolidated Growth Capital
(temporary services), Denver, CO,
from January to June of 1996, and
the Director of Corporate Finance,
Tamaron Capital Markets (investment
banking), Denver, CO, from November
1993 to May 1994.
John Mulder (62) Mr. Mulder is the Senior Vice
Director since 1992 President -- Automotive Marketing of
Gentex Corporation, and he has held
that position since September 1998.
He previously was Vice President -
Automotive Marketing for more than
five years.
2
<PAGE> 5
DIRECTORS WHOSE TERMS EXPIRE IN 2000
Fred Bauer (56) Mr. Bauer is the Chairman and Chief
Director since 1981 Executive Officer of Gentex
Corporation, and he has held that
position for more than five years.
Leo Weber (69) Since 1990, Mr. Weber has been
Director since 1991 engaged in the consulting business
as L. L. Weber & Associates, West
Bloomfield, MI. Previously, he was
the President of Robert Bosch
Corporation, Farmington Hills, MI
(manufacturer of sophisticated
automotive components).
- - --------------------------------------------------------------------------------
Arlyn Lanting and Kenneth La Grand are brothers-in-law. There are no
other family relationships between the nominees, directors, and executive
officers of the Company.
The Company has an Audit Committee comprised of Messrs. Lanting and
Weber. The Audit Committee recommends to the Board of Directors the selection of
independent public accountants and reviews the scope of their audit, their audit
report, and any recommendations made by them. This Committee met on two
occasions during the fiscal year ended December 31, 1998.
The Company has a Compensation Committee comprised of Messrs. Bauer,
Lanting and Thompson. The Compensation Committee is responsible for
administering the Company's stock-based incentive plans and supervising other
compensation arrangements for executive officers of the Company. The
Compensation Committee met five times during the fiscal year ended December 31,
1998.
In addition, the Company has an Executive Committee comprised of
Messrs. Bauer, Lanting and La Grand which is authorized to act on behalf of the
Board between full Board meetings, to the extent permitted by law. This
committee met once during the fiscal year ended December 31, 1998.
The Company does not have a standing nominating committee.
During 1998 the Board of Directors met on four occasions. All directors
attended at least 75 percent of the aggregate number of meetings of the Board
and Board committees on which they served.
--------------------
3
<PAGE> 6
SECURITIES OWNERSHIP OF MANAGEMENT
The following table contains information with respect to ownership of
the Company's common stock by all directors, nominees for election as directors,
executive officers named in the tables under the caption Executive Compensation,
and all executive officers and directors as a group. The content of this table
is based upon information supplied by the Company's officers, directors, and
nominees for election as directors, and represents the Company's understanding
of circumstances in existence as of March 1, 1999.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF OWNERSHIP
------------------------------------------
NAME OF SHARES BENEFICIALLY EXERCISABLE PERCENT
BENEFICIAL OWNER OWNED (1) OPTIONS (2) OF CLASS
- - --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Fred Bauer 3,668,467 108,003 5.1%
Mickey E. Fouts 20,000 20,000 *
Enoch Jen 131,903 77,603 *
Arlyn Lanting 592,050(3) 192,000 *
Kenneth La Grand 635,604(4) 170,056 *
John Mulder 184,396 37,096 *
Ted Thompson 232,000 *
208,000
Leo L. Weber 68,000 60,000 *
All directors and executive 5,532,420 7.6%
officers as a group 872,758
(8 persons)
- - --------------------------------------------------------------------------------------------------------
</TABLE>
* Less than one percent.
(1) Except as otherwise indicated by footnote, each named person claims
sole voting and investment power with respect to the shares indicated.
(2) This column reflects shares subject to options exercisable within 60
days, and these shares are included in the column captioned "Shares
Beneficially Owned."
(3) Includes 400,000 shares owned of record by Aspen Enterprises, Ltd., of
which Mr. Lanting is a director, officer and substantial shareholder,
and Mr. Lanting disclaims beneficial ownership of those shares. Also
includes 25 shares owned by Mr. Lanting's spouse through a partnership,
and Mr. Lanting disclaims beneficial ownership of those shares.
(4) Includes 50,000 shares held in a trust established by Mr. La Grand's
spouse, and Mr. La Grand disclaims beneficial ownership of those
shares.
4
<PAGE> 7
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table contains information with respect to ownership of
the Company's common stock by persons or entities who are beneficial owners of
more than five percent of the Company's voting securities. The information
contained in this table is based on information contained in Schedules 13D and
13G furnished to the Company.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
- - -----------------------------------------------------------------------------------------
<S> <C> <C>
State Treasurer 4,027,000 (1) 5.6%
State of Michigan
P.O. Box 15128
Lansing, MI 48901
</TABLE>
(1) The State Treasurer acts as the investment fiduciary for retirement systems
sponsored by the State of Michigan for Public School Employees, State
Employees, State Police, Judges, and Probate Judges.
--------------------
5
<PAGE> 8
EXECUTIVE COMPENSATION
The following table contains information regarding compensation paid by
the Company with respect to the preceding fiscal year to its chief executive
officer and to each executive officer whose salary and bonus compensation
exceeded $100,000.
Summary Compensation Table
<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------------------------------------------------
LONG-TERM COMPENSATION
-------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------- ------------------------ -------
RESTRICTED SECURITIES ALL OTHER
YEAR SALARY BONUS OTHER STOCK UNDERLYING COMPENSATION
EXECUTIVE ($) ($) ($) AWARD($)(1) OPTIONS(#) LTIP($) ($)(2)
- - --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fred Bauer 1998 283,126 53,791 50,000 4,127
Chairman and CEO 1997 267,680 74,433 -- 60,000 3,952
1996 257,548 120,790 -- 30,000 3,467
Kenneth La Grand 1998 172,164 43,366 168,375 24,000 3,876
Executive Vice 1997 160,643 55,259 -- 40,000 3,701
President 1996 156,221 52,769 -- 34,000 3,703
John Mulder 1998 203,879 64,192 133,297 18,000 3,945
Vice President, 1997 179,133 57,372 -- 30,000 3,772
Automotive Marketing 1996 188,642 54,519 -- 29,000 4,261
Enoch Jen 1998 107,856 43,398 212,674 24,000 3,740
Vice President, 1997 101,176 40,477 -- 24,000 3,564
Finance & Treasurer 1996 96,488 38,253 -- 40,000 3,564
- - --------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the aggregate market value at the date of grant for shares of
common stock awarded under the Company's Restricted Stock Plan. Assuming
continued employment with the Company, restrictions on shares lapse upon
the expiration of five years from the date of grant in the case of Mr. Jen,
and one-third each on the 4th, 5th, and 6th anniversaries of the grant in
all other cases. Dividends will be paid on these shares if, and to the same
extent paid on the Company's common stock generally. At the close of the
Company's fiscal year, the following officers held the following number of
restricted shares with the corresponding net market values: K. La Grand
52,000 shares for $1,040,000; J. Mulder 41,500 shares for $830,000; and E.
Jen 33,000 shares for $660,000.
(2) These amounts represent the sum of "matching" contributions by the Company
pursuant to its 401(k) Plan and annual premiums for term life insurance
attributed to each executive officer.
--------------------
6
<PAGE> 9
The following table contains information regarding stock options
granted to the above-named executive officers during the preceding fiscal year.
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------------------------
NUMBER OF PERCENT GRANT DATE
SECURITIES, OF OPTIONS EXERCISE PRESENT
UNDERLYING TO ALL PRICE EXPIRATION VALUE
EXECUTIVE OPTIONS(#)(1) EMPLOYEES ($/SH)(2) DATE ($)(3)
- - -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Fred Bauer 50,000 6.1 13.375 8/14/05 361,235
Kenneth La Grand 24,000 2.9 14.156 9/25/05 177,626
John Mulder 18,000 2.2 14.156 9/25/05 133,220
Enoch Jen 24,000 2.9 16.375 3/27/05 214,793
- - -------------------------------------------------------------------------------------------------------------
</TABLE>
(1) These options become exercisable, so long as employment with the Company
continues, for 20 percent of the shares on each anniversary of the grant
date commencing with the first anniversary of the grant date.
(2) The exercise price may be paid in cash, in shares of the Company's common
stock, and/or by the surrender of exercisable options valued at the
difference between the exercise price and the market value of the
underlying shares.
(3) Based on the Black-Scholes option valuation model, assuming volatility of
43%, a risk-free rate of return equal to seven-year treasury bonds, a
dividend yield of zero, and an exercise date of seven years after grant.
This model is an alternative suggested by the Securities and Exchange
Commission, and the Company neither endorses this particular model, nor
necessarily agrees with this method for valuing options. The ultimate value
of options will depend on the Company's success, as reflected by an
increase in the price of its shares, which will inure to the benefit of all
shareholders.
--------------------
7
<PAGE> 10
The following table contains information regarding the exercise of
options during the preceding fiscal year by the above-named executives, as well
as unexercised options held by them at fiscal year-end.
Aggregated Option Exercises in Last Fiscal Year and Year-end Values
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
SHARES UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
ACQUIRED OPTIONS AT FISCAL IN-THE-MONEY OPTIONS
ON VALUE YEAR-END (#) FISCAL YEAR-END ($)
EXERCISE REALIZED ---------------------------- ------------------------------
EXECUTIVE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fred Bauer -- -- 108,003 151,997 1,408,159 1,375,583
Kenneth La Grand 79,548 1,138,469 170,056 108,396 2,485,364 1,027,547
John Mulder 91,308 966,751 37,096 78,596 430,157 717,215
Enoch Jen 41,602 519,064 54,400 87,198 820,701 875,518
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
Executive Compensation Report
The Company's executive compensation program is administered by the
Compensation Committee of the Board of Directors. This Committee is comprised of
three members: two independent outside directors and the Chief Executive Officer
(C.E.O.). All C.E.O. compensation is set by the Board of Directors without
participation by the C.E.O. The Committee makes recommendations to the Board of
Directors with respect to executive compensation matters, except for awards made
pursuant to the Company's stock-based incentive plans, which are the exclusive
prerogative of the Committee.
The executive compensation program is composed of three elements: base
salary, annual bonus, and stock-based incentives. These elements are utilized to
accommodate several objectives:
- Provide the means to attract, motivate, and retain executive
management personnel.
- Provide for long-term success by focusing on continuing
technical development and improvement in customer
satisfaction.
- Provide base salary compensation that is competitive in the
market for managerial talent.
- Provide annual bonus compensation reflective of both
individual achievement and overall Company performance.
- Provide stock-based incentive compensation that focuses on
long-term Company performance and aligning the interests of
management with the interests of shareholders.
Base salary compensation for executive officers is predicated primarily
on competitive circumstances for managerial talent and positions reflecting
comparable responsibility. These competitive circumstances are determined from
local, regional, and national surveys of employers comparable to the Company in
size, stage of development, and industry. Historically, base salaries for
executive officers have been relatively low, and stock-based incentives have
received more emphasis, reflecting the entrepreneurial, high growth rate stage
of the Company's development. Base salary decisions for executive officers other
than the C.E.O. are determined by C.E.O. F. Bauer. The base salary for C.E.O.
Bauer for 1998 was recommended by the Committee (without participation by C.E.O.
Bauer) and approved by the Board of Directors. The Committee's recommendation
was made after reviewing survey information from several sources, textual
materials regarding executive compensation strategies in general, the past and
expected contributions of C.E.O. Bauer to the Company's progress, the quality,
loyalty, and performance of the management team assembled and led by him, and
the relationships between his salary and the average salary levels for the
Company's hourly paid workers, salaried employees, and executive officers.
8
<PAGE> 11
Annual bonus compensation for executive officers is composed of two
elements: payments under the Company's Gain Sharing Bonus Plan and performance
bonuses. All employees of the Company, including executive officers, are
eligible to share in the Company's Gain Sharing Bonus Plan after the first three
months of employment. A percentage of pre-tax income, in excess of an
established threshold for shareholder return on equity, is distributed quarterly
to eligible employees. The amount to be distributed is allocated among all
eligible employees in proportion to the salary or wages (including overtime)
paid to those employees during the quarter. In addition, performance bonuses are
paid to various managerial employees, including executive officers, based upon
individual performance during the year and the overall performance of the
Company during the year. Regarding 1998, C.E.O. F. Bauer evaluated the
performance of each executive officer, sometimes in consultation with other
officers, and determined performance bonuses predicated approximately one-half
on the individual's achievements and contributions to Company success, and
one-half on the overall performance of the Company for the year. C.E.O. F. Bauer
participated in the Gain Sharing Plan along with all other eligible employees.
Stock-based incentive compensation is intended to align the interests
of shareholders and senior management by making the managers shareholders in a
significant amount, and providing them incentives to work to increase the price
of the Company's shares by granting them options to acquire additional shares.
Generally, restricted stock grants are subject to forfeiture if the executive
officer does not continue employment with the Company for the period specified
at the time of grant. Similarly, stock options become exercisable generally for
a portion of the shares after one year and for additional portions each year
thereafter, subject however to the requirement that the optionee must be
employed by the Company at the time of exercise. During 1998 stock options were
awarded to executive officers, other than the C.E.O., by the Committee, based
upon recommendations from C.E.O. F. Bauer, taking into consideration for each
executive the scope of responsibility, contribution to success in prior periods,
ability to influence success in the future, and demonstrated ability to achieve
agreed-upon goals. In addition, the Board approved the recommendation of the
Committee (arrived at without the participation of Mr. Bauer) to grant C.E.O. F.
Bauer an option to acquire 50,000 shares of common stock, based upon the
Committee's evaluation of his management of the Company's other managerial
employees and his desire to receive bonus compensation in the form of options
rather than cash.
Compensation Committee Members:
Fred Bauer
Arlyn Lanting
Ted Thompson
--------------------
9
<PAGE> 12
Stock Performance Graph
The following graph depicts the cumulative total return of the
Company's common stock compared to the cumulative total return on The Nasdaq
Stock Market(R) index (all U.S. companies) and the Dow Jones Index for
Automobile Parts and Equipment Companies (excluding tire and rubber makers). The
graph assumes an investment of $100 on the last trading day in 1993, and
reinvestment of dividends in all cases.
[GRAPH]
<TABLE>
<CAPTION>
12/31/93 12/30/94 12/29/95 12/31/96 12/31/97 12/31/98
- - ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GENTEX $100 $ 69 $ 62 $114 $152 $227
- - ------------------------------------------------------------------------------------------------------------------
NASDAQ STOCK
MARKET (U.S.
COMPANIES) $100 $ 98 $138 $170 $209 $293
- - ------------------------------------------------------------------------------------------------------------------
DOW JONES AUTO
PARTS & EQUIPMENT
COMPANIES (EXCLUDING
TIRE AND RUBBER MAKERS) $100 $ 85 $106 $120 $153 $144
- - ------------------------------------------------------------------------------------------------------------------
</TABLE>
-------------------
The Company has not adopted any long-term incentive plan or any defined
benefit or actuarial plan, as those terms are defined in the applicable
regulations promulgated by the Securities and Exchange Commission. Neither does
the Company have any contracts with its executive officers assuring them of
continued employment, nor any compensatory arrangement for executives linked to
a change in control of the Company.
Directors who are employees of the Company receive no compensation for
services as directors. Directors who are not employees of the Company receive a
director's retainer in the amount of $6,000 per year plus $800 for each meeting
of the Board attended and $500 for each committee meeting attended. In addition,
each nonemployee person who is a director immediately following each annual
meeting of shareholders is entitled to receive an option to purchase 5,000
shares of the Company's common stock at a price per share equal to the fair
market value on that date. Each option has a term of ten years and becomes
exercisable in full six months after the date of the grant.
10
<PAGE> 13
Compensation Committee Interlocks and Insider
Participation in Compensation Decisions
Fred Bauer, Chairman and C.E.O., was a member of the Company's
Compensation Committee during the fiscal year ended December 31, 1998. That
Committee was responsible for supervising the Company's executive compensation
arrangements, including the making of decisions with respect to the award of
stock-based incentives for executive officers during that year.
Arlyn Lanting, a director and member of the Company's Compensation
Committee, was an officer of the Company more than fifteen years ago.
TRANSACTIONS WITH MANAGEMENT
Since 1978, prior to the time the Company became a publicly held
corporation, the Company has leased a building that previously housed its main
office, manufacturing and warehouse facilities, and currently houses production
operations for the Company's fire protection products. The lessor for that
building is G & C Associates, a general partnership, and nearly all of the
partnership interests in G & C Associates are held by persons related to Fred
Bauer. The lease is a "net" lease, obligating the Company to pay all expenses
for maintenance, taxes and insurance, in addition to rent. During 1998 the rent
paid to this partnership was $52,153, and the rent for the current fiscal year
is the same. The Board of Directors believes that the terms of this lease are at
least as favorable to the Company as could have been obtained from unrelated
parties.
Arlyn Lanting and Kenneth La Grand are both substantial shareholders in
GTI Travel Inc., a local travel agency used by the Company to book airline
travel for its employees. During 1998 the Company paid $417,806 for airline
travel booked through this agency. This arrangement has been reviewed by the
Company's Board of Directors and approved on the basis that the prices and
services provided afford the best value available to the Company.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Ernst & Young LLP to serve as the
Company's independent auditors for the fiscal year ending December 31, 1999.
Representatives of Ernst & Young LLP are expected to be present at the annual
meeting to respond to appropriate questions, and will have an opportunity to
make a statement if they desire.
The public accounting firm of Arthur Andersen LLP was engaged as the
Company's independent public accountants through 1998, and that engagement was
terminated by the Company's Board of Directors at the recommendation of its
Audit Committee. During Arthur Andersen's engagement, there were no
disagreements on any matter of accounting principles or practices, financial
statement disclosures, or audit scope, or procedure. The reports of Arthur
Andersen on the Company's financial statements for the past two years have not
contained an adverse or qualified opinion or disclaimer of opinion.
Representatives of Arthur Andersen are expected to be present at the annual
meeting to respond to appropriate questions, and will have an opportunity to
make a statement if they desire.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based upon a review of Forms 3, 4, and 5 furnished to the Company
during or with respect to the preceding fiscal year, and written representations
from certain reporting persons, the Company is not aware of any failure by any
reporting person to make timely filings of those Forms as required by Section
16(a) of the Securities Exchange Act of 1934.
SHAREHOLDER PROPOSALS
If a shareholder intends to present a proposal for action at the 1999
Annual Meeting of Shareholders, notice of that proposal must be given to the
Secretary of the Company, in accordance with the Company's by-laws, on or before
April 22, 1999. In addition, any proposal of a shareholder intended to be
presented at the next annual meeting of the Company must be received by the
Company at its headquarters at 600 N. Centennial Street, Zeeland, Michigan
49464, no later than December 11, 1999, if the shareholder wishes the proposal
to be included in the Company's proxy statement relating to that meeting.
11
<PAGE> 14
The Company's Annual Report to Shareholders, including financial
statements, is being mailed to shareholders with this Proxy Statement.
Management is not aware of any matters to be presented for action at
the Annual Meeting, other than as set forth in this Proxy Statement. If other
business should come before the meeting, the persons named as proxy holders in
the accompanying Proxy intend to vote the shares in accordance with their
judgment, and discretionary authority to do so is included in the Proxy.
A COPY OF THE COMPANY'S REPORT ON FORM 10-K FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION IS AVAILABLE WITHOUT CHARGE, UPON WRITTEN REQUEST, FROM
THE SECRETARY OF THE COMPANY, 600 N. CENTENNIAL STREET, ZEELAND, MICHIGAN 49464.
Shareholders are urged to promptly date, sign, and return the
accompanying Proxy in the enclosed envelope.
By Order of the Board of Directors
Connie Hamblin
Secretary
April 12, 1999
12
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PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The shareholder(s) signing on the reverse side hereby appoint(s) Connie Hamblin
and Enoch Jen as Proxies, each with the power to appoint a substitute, and
hereby authorizes them to represent and to vote, as designated herein, all of
the shares of common stock of Gentex Corporation held of record by such
shareholder(s) on March 26, 1999, at the Annual Meeting of Shareholders to be
held on May 20, 1999, or any adjournment thereof.
1. Election of Directors (except where marked to the contrary) for a
three-year term. [ ] FOR [ ] WITHHELD
NOMINEES: Arlyn Lanting, Kenneth La Grand, Ted Thompson
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR AN INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME LISTED ABOVE.)
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting. [ ] I plan to
attend the meeting. [ ] I do not plan to attend the meeting.
(To be Signed on Reverse Side)
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When properly executed, this proxy will be voted in the manner directed by the
shareholder(s). IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE
ELECTION OF THE NOMINEES LISTED FOR A THREE-YEAR TERM.
NOTE: Please sign as your name appears
hereon. When shares are held jointly, each
holder should sign. When signing for an
estate, trust, or corporation, the title
and capacity should be stated. Persons
signing as attorney-in-fact should submit
powers of attorney.
Signature Date Signature Date
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