<PAGE>
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
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
HEICO CORPORATION
(Name of Registrant as Specified in Its Charter)
HEICO CORPORATION
(Name of Persons(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on the 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 transactions apply:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
<PAGE>
HEICO CORPORATION
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 21, 1995
------------------------
The Annual Meeting of Shareholders of HEICO Corporation, a Florida
corporation ('HEICO'), will be held on March 21, 1995, at 10:00 A.M. local time,
at HEICO's principal executive offices, 3000 Taft Street, Hollywood, Florida,
for the following purposes:
1. To elect a Board of Directors for the ensuing year; and
2. Transacting such other business as may properly come before the meeting
or any adjournments thereof.
Only holders of record of HEICO Common Stock at the close of business on
January 20, 1995 will be entitled to vote at the Meeting.
YOU ARE REQUESTED, REGARDLESS OF THE NUMBER OF SHARES OWNED, TO SIGN AND
DATE THE ENCLOSED PROXY AND TO MAIL IT PROMPTLY. YOU MAY REVOKE YOUR PROXY
EITHER BY WRITTEN NOTICE TO HEICO OR IN PERSON AT THE MEETING (WITHOUT AFFECTING
ANY VOTE PREVIOUSLY TAKEN).
BY ORDER OF THE BOARD OF DIRECTORS
3000 Taft Street Laurans A. Mendelson,
Hollywood, Florida Chairman of the Board, President
February 15, 1995 and Chief Executive Officer
<PAGE>
HEICO CORPORATION
3000 TAFT STREET, HOLLYWOOD, FLORIDA 33021
------------------------
PROXY STATEMENT
------------------------
This Proxy Statement is furnished to the shareholders of HEICO Corporation
('HEICO' or the 'Company') in connection with the solicitation of proxies by
HEICO's Board of Directors for use at the annual meeting of shareholders of
HEICO to be held at the principal executive offices of HEICO, 3000 Taft Street,
Hollywood, Florida 33021 on Tuesday, March 21, 1995 at 10:00 A.M., local time.
This Proxy Statement is first being mailed to shareholders on or about February
17, 1995.
At the annual meeting, the shareholders will be asked to elect a Board of
Directors and to vote on any other business which properly comes before the
meeting.
THE BOARD OF DIRECTORS OF HEICO URGES YOU PROMPTLY TO DATE, SIGN AND MAIL
YOUR PROXY, IN THE FORM ENCLOSED WITH THIS PROXY STATEMENT, TO MAKE CERTAIN THAT
YOUR SHARES ARE VOTED AT THE MEETING. PROXIES IN THE ENCLOSED OR OTHER
ACCEPTABLE FORM THAT ARE RECEIVED IN TIME FOR THE MEETING WILL BE VOTED.
HOWEVER, YOU MAY REVOKE YOUR PROXY AT ANY TIME BY A REVOCATION IN WRITING OR A
LATER DATED PROXY THAT IS RECEIVED BY HEICO, AND IF YOU ATTEND THE MEETING YOU
MAY VOTE YOUR SHARES IN PERSON.
If your proxy is received in time for the meeting, it will be voted in the
manner specified by you in the proxy. If you do not specify a choice, the proxy
will be voted as indicated in the form of proxy.
HEICO will bear the expense of soliciting proxies in the accompanying form.
Solicitations will be by mail, and directors, officers and regular employees of
HEICO may solicit proxies personally or by telephone, telegram or special
letter. HEICO will also employ Beacon Hill Partners, Inc., 90 Broad Street, New
York, New York 10004, to assist in soliciting proxies for a fee of $3,200 plus
related out-of-pocket expenses.
Only holders of record of HEICO Common Stock at the close of business on
January 20, 1995 will be entitled to vote at the meeting. On that date there
were 2,268,646 shares of HEICO Common Stock outstanding, each entitled to one
vote. Of these shares, 402,261 were held by the trustee under the HEICO Savings
and Investment Plan. Under the terms of that Plan, all shares allocated to the
accounts of participating employees and held by the trustee will be voted or not
as directed by written instructions from the participating employees, and
allocated shares for which no instructions are received and all unallocated
shares will be voted in the same proportion as the shares for which instructions
are received.
<PAGE>
VOTING SECURITIES OF PRINCIPAL SHAREHOLDERS AND MANAGEMENT
The following table sets forth information with respect to the beneficial
ownership of the Company's outstanding Common Stock as of January 20, 1995, by
the only persons known to the Company to be beneficial owners of more than 5% of
the Company's outstanding Common Stock, as well as by all directors of the
Company, those executive officers of the Company who are listed in the Summary
Compensation Table and all directors and officers of the Company as a group. The
Company is unaware of any other persons who beneficially own more than 5% of the
Company's outstanding Common Stock as of January 20, 1995.
<TABLE>
<CAPTION>
NAME AND ADDRESS NO. OF SHARES AND NATURE
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP(1) PERCENTAGE OF CLASS
- - - - ------------------------------------------------ -------------------------- -------------------
<S> <C> <C>
(a) Certain beneficial owners:
Mendelson Reporting Group 538,010(2) 21.07%
825 South Bayshore Drive, 16th Floor
Miami, Florida 33131
HEICO Savings and Investment Plan 402,261(3) 17.73%
c/o NationsBank Trust
P.O. Box 1469
Tampa, Florida 33601
Dr. Herbert A. Wertheim 337,900(4) 14.89%
191 Leucadendra Drive
Coral Gables, Florida 33156
Dimensional Fund Advisors Inc. 168,150(5) 7.41%
1299 Ocean Avenue, Suite 650
Santa Monica, California 90401
(b) Directors:
Jacob T. Carwile 40,500(6) 1.76%
Samuel L. Higginbottom 200 *
Paul F. Manieri 40,650(7) 1.76%
Eric A. Mendelson 94,012(8) 4.06%
Laurans A. Mendelson 451,025(9) 18.27%
Albert Morrison, Jr. 4,700(10) *
Dr. Alan Schriesheim 36,900(11) 1.60%
Guy C. Shafer 3,000 *
(c) Executive officers listed in Summary
Compensation Table who are not directors:
Thomas S. Irwin 80,256(12) 3.44%
Joseph A. Paul 17,517(13) *
Paul M. Stanley -0- -0-
(d) All directors and officers
as a group (12 persons) 735,316(14) 27.06%
All directors, officers, the HEICO
Savings and Investment Plan and the
Mendelson Reporting Group as a group 1,175,565(15) 42.68%
- - - - ------------------------
footnotes on next page
2
<PAGE>
<FN>
- - - - ------------------------
* Represents ownership of less than 1%.
(1) This column sets forth shares of HEICO Common Stock which are deemed to be 'beneficially owned' by the
persons named in the table in accordance with Securities and Exchange Commission ('SEC') regulations. The
persons named in the table have sole voting and investment power with respect to all shares shown as
beneficially owned by them except as otherwise described in the following footnotes.
(2) The Mendelson Reporting Group is a reporting group for purposes of SEC Rule 13d-1 consisting of Laurans A.
Mendelson, Eric A. Mendelson, Victor H. Mendelson and Mendelson International Corporation ('MIC'), a
corporation whose stock is owned solely by Eric and Victor Mendelson. Includes 285,000 shares covered by
currently exercisable stock options. See Notes (8) and (9) below.
(3) As of September 30, 1994, the shares held by the HEICO Savings and Investment Plan include 89,992 shares
allocated to participant's individual accounts and 312,269 unallocated shares.
(4) Based on information in an October 28, 1993 Schedule 13D filed by Dr. Wertheim with the SEC.
(5) Dimensional Fund Advisors Inc. ('Dimensional'), a registered investment advisor, is deemed to have beneficial
ownership of 168,150 shares of HEICO Common Stock as of December 31, 1994, all of which shares are held in
portfolios of DFA Investment Dimensions Group Inc., a registered open-end investment company, or in series of
the DFA Investment Trust Company, a Delaware business trust, or the DFA Group Trust and DFA Participating
Group Trust, investment vehicles for qualified employee benefit plans, all of which Dimensional serves as
investment manager. Dimensional disclaims beneficial ownership of such shares.
(6) Includes 37,500 shares covered by currently exercisable stock options and 3,000 shares owned with Mr.
Carwile's wife.
(7) Includes 37,500 shares covered by currently exercisable stock options and 150 shares owned with Mr. Manieri's
wife.
(8) Includes 45,015 shares held by MIC, 47,500 shares covered by currently exercisable stock options and 1,497
shares held by the HEICO Savings and Investment Plan and allocated to Eric A. Mendelson's account. See Note
(2) above.
(9) Laurans A. Mendelson disclaims beneficial ownership with respect to 45,015 of these shares, which are held in
the name of MIC. The remaining 406,284 shares are held solely by Mr. Mendelson and include 200,000 shares
covered by currently exercisable stock options and 2,880 shares held by the HEICO Savings and Investment Plan
and allocated to Mr. Mendelson's account. See Notes (2) and (8) above.
(10) Albert Morrison Jr.'s voting and dispositive power with respect to these shares is held indirectly through
Sheridan Ventures, Inc., a corporation of which Mr. Morrison is the President, but not a shareholder.
(11) Includes 33,750 shares covered by currently exercisable stock options.
(12) Includes 65,837 shares covered by currently exercisable stock options and 5,207 shares held by the HEICO
Savings and Investment Plan and allocated to Thomas S. Irwin's account.
(13) Includes 17,500 shares covered by currently exercisable stock options and 17 shares held by the HEICO Savings
and Investment Plan and allocated to Joseph A. Paul's account.
(14) Includes 448,387 shares covered by currently exercisable stock options. The total for all directors and
officers as a group also includes 12,372 shares held by the HEICO Savings and Investment Plan and allocated
to accounts of officers pursuant to the Plan. See Note (3) above.
(15) Includes all shares and options held by all directors and officers (12 persons), the HEICO Savings and
Investment Plan and all members of the Mendelson Reporting Group.
</FN>
</TABLE>
3
<PAGE>
PROPOSAL TO ELECT DIRECTORS
Each of the eight individuals named in the table below has been nominated
by management for election to the Board of Directors at the annual meeting to
serve until the next annual meeting or until his successor is elected and
qualified. All of the nominees are currently serving as directors.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE CORPORATE OFFICE OR POSITION SINCE
- - - - ---------------------------- --- ----------------------------------------------------------- --------
<S> <C> <C> <C>
Jacob T. Carwile 72 Director(1)(3) 1975
Samuel L. Higginbottom 73 Director(1)(2)(5) 1989
Paul F. Manieri 77 Director(1)(2)(4) 1985
Eric A. Mendelson 29 Vice President of Aerospace Operations, President of HEICO 1992
Aerospace Corporation and Director(6)
Laurans A. Mendelson 56 Chairman of the Board, President and Chief Executive 1989
Officer, Director(2)(6)
Albert Morrison, Jr. 58 Director(3)(5) 1989
Dr. Alan Schriesheim 64 Director(2)(4) 1984
Guy C. Shafer 76 Director(1)(5) 1989
<FN>
- - - - ------------------------
(1) Member of Nominating and Executive Compensation Committee.
(2) Member of Executive Committee.
(3) Member of Finance/Audit Committee.
(4) Member of Environmental, Safety and Health Committee.
(5) Member of Stock Option Plan Committee.
(6) Laurans A. Mendelson is the father of Eric A. Mendelson.
</FN>
</TABLE>
BUSINESS EXPERIENCE OF NOMINEES
Mr. Carwile, U.S.A.F. Lt. Col. retired, is a private investor and aerospace
consultant. From 1970 to 1987 he was President of his own company which was
primarily engaged in the sale of aircraft instruments and airframe components to
the U.S. government.
Mr. Higginbottom is a retired executive officer of Rolls Royce, Inc., (an
aircraft engine manufacturer), where he served as Chairman, President and Chief
Executive Officer from 1974 to 1986. He was the Chairman of the Columbia
University Board of Trustees from 1982 until September 1989. He was President,
Chief Operating Officer and a director of Eastern Airlines, Inc., from 1970 to
1973 and served in various other executive capacities with that company from
1964 to 1969. Mr. Higginbottom is a director of British Aerospace Holdings,
Inc., an aircraft manufacturer, and was a director of AmeriFirst Bank from
1986 to 1991.
Mr. Manieri is a retired executive of IBM Corporation, having held various
positions there for 44 years, including Director of Manufacturing and
Engineering for IBM World Trade Corporation and Director of Personnel and
Director of Communications for IBM Corporation.
4
<PAGE>
Mr. Eric A. Mendelson has been President and Chief Operating Officer of
HEICO Aerospace Corporation, a wholly-owned subsidiary of HEICO ('HEICO
Aerospace') since April 1993 and Vice President-Aerospace Operations of
HEICO since 1992. He also served as Executive Vice President and Chief
Operating Officer of HEICO's Jet Avion Corporation, a wholly-owned
subsidiary of HEICO Aerospace since 1991. From 1990 to 1991, Mr.
Mendelson was Director of Planning and Operations of HEICO. Mr. Mendelson is a
co-founder and, since 1987, has been Managing Director of Mendelson
International Corporation, a private investment company which is a shareholder
of HEICO (see 'Voting Securities of Principal Shareholders and Management,'
above). Mr. Mendelson received his MBA from Columbia University Graduate School
of Business and his AB degree from Columbia College.
Mr. Laurans A. Mendelson has been Chairman of the Board and Chief Executive
Officer of HEICO since 1990 and President since 1991. Mr. Mendelson has been
Chairman of the Board of Ambassador Square, Inc. (a real estate development and
management company) since 1980 and President of that company since 1988, as well
as Chairman of the Board of Columbia Ventures, Inc. (a private investment
company) since 1985 and that company's President since 1988. He is a member of
the Alumni Advisory Board to the Columbia University Board of Trustees and was a
member of the Columbia College Board of Visitors from 1984 through 1990. Mr.
Mendelson is also a member of the Board of Trustees and Finance Committee of Mt.
Sinai Medical Center, Miami Beach, Florida. He is a member of the American
Institute of Certified Public Accountants, the Florida Institute of Certified
Public Accountants, the New York State Society of Certified Public Accountants,
the Society of University Grand Founders of the University of Miami and the
Citizen's Board of the University of Miami.
Mr. Morrison has been President of Morrison, Brown, Argiz & Company, a
certified public accounting firm located in Miami, Florida, since 1971. He has
been the Vice Chairman of the Dade County Industrial Development Authority since
1983. He is the Treasurer of the Florida International University Board of
Trustees and has served as a Trustee since 1980. Mr. Morrison is also a director
of Logic Devices, Inc., a computer electronics company.
Dr. Schriesheim is the Director of Argonne National Laboratory (located
near Chicago, Illinois). Prior to his appointment to that position in 1984, he
was Senior Deputy Director and Chief Operating Officer of Argonne (1983-84).
From 1956 to 1983, Dr. Schriesheim served in a number of capacities with Exxon
Corporation in research and administration, including positions as General
Manager of the Engineering Technology Department for Exxon Research and
Engineering Co. and Director of Exxon's Corporate Research Laboratories. Dr.
Schriesheim is also a director of Rohm and Haas Company, a chemical company, and
a member of the Board of the Children's Memorial Hospital of Chicago, Illinois.
Mr. Shafer is retired from Coltec Industries, Inc., formerly Colt
Industries, Inc., (a manufacturer of aviation and automotive equipment), where
he served as Advisor to the Chief Executive Officer from 1987 to 1988, Executive
Vice President from 1985 to 1986 and Group Vice President from 1969 to 1985. Mr.
Shafer has been in the aviation and automotive manufacturing industry since
1946.
Meetings of the Board of Directors are held periodically during the year.
The Board held six meetings in fiscal 1994. The Board currently has five
standing committees: the Executive Committee; the Nominating and Executive
Compensation Committee; the Finance/Audit Committee; the Environmental, Safety
and Health Committee and the Stock Option Plan Committee. The Executive
Committee has such powers as are delegated by the Board, which may be exercised
while the Board is not in session, provided such powers are not in conflict with
specific powers conferred to other committees or are otherwise contrary to law.
The Nominating and Executive Compensation Committee determines the Company's
director and officer requirements and recommends to the full Board nominees for
election. The Nominating and Executive Compensation Committee does not solicit
nominations from shareholders. The Committee also reviews and approves
compensation of the Company's officers, key employees and directors. The
Finance/Audit Committee meets with the Company's Chief Financial Officer and its
auditors to review the scope and
5
<PAGE>
results of their audits and consults with the auditors with respect to the
Company's internal controls. In addition, the Finance/Audit Committee
reviews financial matters which may arise from time to time. The
Environmental, Safety and Health Committee meets with the Company's senior
management and oversees compliance in all matters relating to federal and state
environmental, safety and health regulations. The Stock Option Plan Committee
administers the Company's stock option plans including authority to grant
options, determine the persons to whom and the times at which options are
granted, and determine the terms and provisions of each grant. During fiscal
1994, no separate meetings of the Executive Committee or the Stock Option Plan
Committee were held, the Nominating and Executive Compensation Committee met
four times, the Finance/Audit Committee met twice and the Environmental, Safety
and Health Committee met five times.
The persons named in the enclosed proxy card intend to vote such proxy for
the election of the listed nominees, or, in the event of death,
disqualification, refusal or inability of any nominee to serve, for the election
of such other person as management may recommend in the place of such nominee to
fill such vacancy. Management has no reason to believe that any of the nominees
will not be a candidate or will be unable to serve.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR ALL OF
MANAGEMENT'S NOMINEES.
COMPENSATION OF DIRECTORS
Currently, directors of the Company receive director's fees of $1,000 for
each regular Board meeting attended and a $12,000 annual retainer. Members of
committees of the Board of Directors of the Company are paid a $2,000 annual
retainer for each committee served and $500 for attendance at each committee
meeting. Per diem fees for other consulting services are paid to individual
directors, as assigned by the Chairman of the Board, in the amount of $500 per
day. During fiscal 1994, an aggregate of $251,000 was paid to directors under
the compensation arrangements described above (including $49,000 paid to Jacob
Carwile, $103,500 paid to Samuel Higginbottom, $29,000 paid to Paul Manieri,
$23,000 paid to Albert Morrison, $23,500 paid to Guy Shafer and $23,000 paid to
Dr. Alan Schriesheim), excluding amounts paid to Laurans A. Mendelson and Eric
A. Mendelson, which are reported in the Summary Compensation Table.
Additionally, the Company's Directors' Retirement Plan, adopted in 1991,
covers the then current directors of the Company. Under the Directors'
Retirement Plan, participants will, upon retirement from the Board, receive
quarterly payments in amounts to be based on the average retainer such director
was paid during his service as a member of the Board of Directors. Such
quarterly payments are not to be less than $3,000. Subject to the terms of the
Plan, theses quarterly payments will continue for the same period of time that
the participant served on the Board, not to exceed ten years. During fiscal
1994, $15,000 was paid to a retired director pursuant to the Directors'
Retirement Plan, while $73,000 was accrued during the year.
6
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table provides certain summary information concerning
compensation paid or accrued by the Company and its subsidiaries, to or on
behalf of the Company's Chief Executive Officer and each of the four other most
highly compensated executive officers of the Company (determined as of the end
of the last fiscal year) for the fiscal years ended October 31, 1992, 1993 and
1994:
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------
AWARDS PAYOUTS
----------------------- ----------
ANNUAL COMPENSATION RESTRICTED
----------------------------------- STOCK OPTIONS/ LTIP ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($)(1) BONUS($)(1) OTHER($) AWARD(S)($) SARS(#)(2) PAYOUTS($) COMPENSATION($)
- - - - --------------------------------- ---- ------------ ----------- -------- ----------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Laurans A. Mendelson 1994 312,000 100,000 20,000(3) 0 20,000 0 28,087(4)
Chairman of the Board 1993 312,000 0 18,000(3) 0 0 0 27,824(4)
President and Chief Executive 1992 312,000 0 19,500(3) 0 0 0 27,691(4)
Officer
Thomas S. Irwin 1994 150,000 30,000 0 0 10,000 0 7,671(5)
Executive Vice President 1993 150,000 0 0 0 9,712 0 7,363(5)
and Chief Financial Officer 1992 150,000 0 0 0 0 0 7,368(5)
Eric A. Mendelson 1994 125,000 25,000 18,000(3) 0 10,000 0 6,400(5)
Vice President of Aerospace 1993 125,000 0 15,000(3) 0 0 0 6,268(5)
Operations; President and Chief 1992 125,000 0 5,000(3) 0 12,500 0 6,108(5)
Operating Officer of HEICO
Aerospace Corporation
Joseph A. Paul 1994 151,207 50,000 0 0 10,000 0 234(5)
Vice President of Medical 1993 136,742 0 0 0 0 0 0
Services Operations; Executive 1992 120,461 0 0 0 12,500 0 0
Vice President of MediTek Health
Corporation
Paul M. Stanley(6) 1994 112,451 0 0 0 0 0 105,000(7)
former President of 1993 156,000 0 0 0 0 0 0
MediTek Health Corporation 1992 156,000 0 0 0 0 0 0
<FN>
- - - - ------------------------
(1) Salary and bonus amounts include amounts deferred by executive officers pursuant to a non-qualified deferred
compensation plan available to selected executive officers. Under such deferred compensation plan, selected
employees may elect to defer a portion of their compensation. Amounts deferred are immediately vested and
invested in individually directed investment accounts. Earnings on such investment accounts, which are
maintained by a Trustee, accrue to the benefit of the individual.
(2) The Company has not granted and does not currently grant Stock Appreciation Rights ('SARs').
(3) Represents payments of directors' fees.
(4) Includes life insurance premiums paid by the Company of $18,750 in fiscal years 1994, 1993 and 1992. Amount
also includes Company contributions to his HEICO Savings and Investment Plan account of $9,337 in fiscal year
1994, $9,074 in fiscal year 1993 and $8,941 in fiscal year 1992. Prior to receiving a portion of the Company
contributions under such Plan, Mr. Mendelson contributed, in cash, twice the amount that he received in stock.
(5) Represents Company contributions to the HEICO Savings and Investment Plan account of the named executive.
Prior to receiving a portion of the Company contributions under such Plan, each named executive contributed,
in cash, twice the amount that he received in HEICO stock.
(6) Mr. Stanley resigned from the Company in May 1994.
(7) Includes $50,000 paid pursuant to an agreement in connection with the resignation of Mr. Stanley and $55,000
for Mr. Stanley's consulting services after his resignation through October 31, 1994.
</FN>
</TABLE>
7
<PAGE>
OPTION/SAR GRANTS TABLE
The following table sets forth information concerning individual grants of
stock options pursuant to the Company's Combined Stock Option Plan during the
fiscal year ended October 31, 1994 to the Company's Chief Executive Officer and
each of the four other most highly compensated executive officers of the
Company. The Company has not granted and does not currently grant stock
appreciation rights.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
% OF TOTAL ANNUAL RATES OF STOCK
OPTIONS/SARS MARKET APPRECIATION FOR
OPTIONS/ GRANTED TO EXERCISE PRICE ON OPTION TERM(2)
SARS EMPLOYEES IN OR BASE DATE OF EXPIRATION -------------------------
NAME AND PRINCIPAL POSITION GRANTED(#) FISCAL YEAR PRICE($/SH) GRANT DATE 0%($) 5%($) 10%($)
- - - - ----------------------------------------- ---------- ------------ -------- ------- ---------- ----- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Laurans A. Mendelson 20,000(1) 25% $ 12.00 $ 12.00 12/17/03 0 $150,935 $382,498
Chairman of the Board, President and
Chief Executive Officer
Thomas S. Irwin 10,000(1) 13% $ 12.00 $ 12.00 12/17/03 0 $ 75,467 $191,249
Executive Vice President and
Chief Financial Officer
Eric A. Mendelson 10,000(1) 13% $ 12.00 $ 12.00 12/17/03 0 $ 75,467 $191,249
Vice President of Aerospace Operations;
President and Chief Operating Officer of
HEICO Aerospace Corporation
Joseph A. Paul 10,000(1) 13% $ 12.00 $ 12.00 12/17/03 0 $ 75,467 $191,249
Vice President of Medical Services
Operations; Executive Vice President of
MediTek Health Corporation; President of
MediTek Health Care Management, Inc.
Paul M. Stanley 0 0 0 0 0 0 0 0
former President of MediTek Health
Corporation
<FN>
- - - - ------------------------
(1) Options were 100% vested at grant.
(2) Based upon arbitrary assumptions of 0%, 5%, and 10% annual appreciation of
the Company's common stock through the expiration date of the executive's
options granted during the last fiscal year.
</FN>
</TABLE>
8
<PAGE>
AGGREGATED OPTION/SAR EXERCISES AND
FISCAL YEAR-END OPTION/SAR VALUE TABLE
The following table sets forth information concerning unexercised options
to purchase the Company's Common Stock as of October 31, 1994 under the
Company's Combined Stock Option Plan, Non-Qualified Stock Option Plan and 1993
Stock Option Plan held by the Chief Executive Officer and each of the four other
most highly compensated executive officers of the Company. None of these
executives exercised any stock options or stock appreciation rights during
fiscal year 1994. Also reported are the values for 'in-the-money' options which
represent the positive spread between the exercise price of any such existing
stock options and the closing price of HEICO Common Stock on the composite tape
of the American Stock Exchange on October 31, 1994:
AGGREGATED OPTION/SAR EXERCISES IN
LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
UNEXERCISED UNEXERCISED
OPTIONS/SARS IN-THE-MONEY
AT FY-END(#) AT FY-END($)
SHARES ACQUIRED EXERCISABLE/ EXERCISABLE/
NAME AND PRINCIPAL POSITION ON EXERCISE(#) VALUE REALIZED($) UNEXERCISABLE UNEXERCISABLE
- - - - ------------------------------------------------- --------------- ----------------- ------------ -------------
<S> <C> <C> <C> <C>
Laurans A. Mendelson 0 0 170,000E 0
Chairman of the Board, President
and Chief Executive Officer
Thomas S. Irwin 0 0 55,837E 25,882E
Executive Vice President and
Chief Financial Officer
Eric A. Mendelson 0 0 35,000E 0
Vice President of Aerospace Operations;
President and Chief Operating Officer of
HEICO Aerospace Corporation
Joseph A. Paul 0 0 15,000E 0
Vice President of Medical Services 7,500U 0
Operations; Executive Vice President of
MediTek Health Corporation; President of
MediTek Health Care Management, Inc.
Paul M. Stanley 0 0 0 0
former President of MediTek Health
Corporation
<FN>
- - - - ------------------------
E--Denotes exercisable options.
U--Denotes unexercisable options.
</FN>
</TABLE>
9
<PAGE>
NOMINATING AND EXECUTIVE COMPENSATION COMMITTEE REPORT
THE COMMITTEE
The Nominating and Executive Compensation Committee (the 'Committee') of
the Board of Directors (the 'Board') is composed entirely of disinterested
members of the Board. No member of the Committee is a current or former employee
or officer of the Company or any of it's affiliates. Decisions concerning
compensation of the Company's executive officers generally are made by the
Committee and all decisions by the Committee relating to compensation of the
Company's executive officers are reviewed by the full Board, except that
decisions relating to awards under the Company's 1993 Stock Option Plan must be
solely made by the Stock Option Committee (the 'SOC') in order for the grants or
awards under such plan to satisfy Rule 16b-3 of the Securities Exchange Act of
1934.
COMPENSATION PHILOSOPHY
In general, the Company's primary objectives in establishing executive
compensation are: (i) ensuring that the interests of shareholders and the
Company's management are properly aligned; (ii) long-term growth pursuit by
management; (iii) recruitment of top-quality management; (iv) stimulation of
both entrepreneurial and team objectives by management; and (v) retaining
high-quality managers in a competitive compensation market. Because a stock is
usually priced at a multiple of a company's earnings, the Committee believes
that stock-based compensation stimulates managers to maximize corporate earnings
and, therefore, the Company's stock price.
Stock option holders do not receive any income or other benefit from their
stock options unless all shareholders gain from an increase in the Company's
stock price. If management's efforts do not result in a share price increase,
management will forego potentially sizeable financial gains, which gains can
represent a substantial income expectation for the affected officers.
RELATIONSHIP TO PERFORMANCE UNDER COMPENSATION PLANS
Base compensation for the Company's executive officers did not increase in
1994. In general, the Committee sought to stimulate managers by rewarding goal
and budgetary achievements through cash bonuses. In certain instances, the
Committee awarded Company stock options in order to foster certain managers'
interest in operating programs designed to yield profits two to four years
hence.
Compensation paid to the Company's executive officers in 1994, as reflected
in the foregoing tables, consisted essentially of base salary, cash bonuses,
stock options, and Company contributions to the HEICO Savings and Investment
Plan (the 'Plan'). All employees of the Company and certain subsidiaries are
eligible to participate in the Plan, but, under Federal regulations, certain
employees of the Company (for HEICO, such employees include all executive
officers who received a matching contribution to their Plan accounts) are
limited in their participation. Further, all officers listed herein who are
eligible to participate in the Plan contributed a portion of their compensation
to the Plan in order to receive the maximum of the Company's contribution.
Executive officers' base salaries are determined through the utilization of
industry data and numerous other considerations of individual performance and
corporate goals. The following items are among the chief factors considered by
the Committee in establishing base salaries for the Company's executive
officers:
1) Compensation analysis reports from an independent consulting firm;
2) Consultation with executives;
10
<PAGE>
3) Known industry standards;
4) Local and geographic standards;
5) Private negotiation with key executives;
6) Alternative employment opportunities available to executives;
7) Industry knowledge and experience;
8) Complexity and difficulty of responsibilities; and
9) Past and expected future contributions to the Company's development.
The Committee desires to reward management's success in meeting the goals
set forth for the Company. Specifically, management had embarked on an ambitious
product development program to expand HEICO Aerospace's product offering.
Management has met or exceeded its new product sales goals during 1994 and is
currently scheduled to meet or exceed those goals in 1995. The new product
development program is critical to the Company's long-term survival and
short-term earnings growth. The Committee notes that no cash bonuses were paid
to executive officers in 1992 or 1993. Accordingly, due to management's success
in achieving various earnings targets (including, among others, new product
development, new product sales and cost reductions), the Committee felt it
appropriate to reward certain executive officers for such success.
Similarly, MediTek Health Corporation achieved its first year of
profitability in 1994, despite substantial losses by other companies in the same
industry. Management was also charged with the responsibility of
cost-effectively relocating MediTek's headquarters. Finally, MediTek's revenues
increased nearly 60% during 1994. The Committee wishes to reward management
accordingly.
Although the Committee believes that its compensation policies have been
appropriate to stimulate long-term growth and attention to short-term
considerations, it plans to review Company compensation practices at various
intervals during 1995 and may, depending upon conditions in its businesses,
industries, the economy, and other factors, revise its policies.
CHIEF EXECUTIVE OFFICER
The Committee evaluates the Chief Executive Officer's compensation
annually. The primary standards which the Committee considers with regard to the
Chief Executive Officer's compensation are substantially the same as those
described with regard to executive officers in general. Further, the Committee
assesses past performance and expectation of further contributions to the
Company.
The Committee believes that the Company has prospered under Mr. Mendelson's
leadership. Specifically, the Company has expanded its aerospace product line,
restructured its aerospace operations, divested itself of an unprofitable
business and entered a new, profitable line of business.
The Committee desires to continue to induce Mr. Mendelson to devote
substantially all of his time and effort to the Company and to forego other
potentially lucrative business transactions. In doing so, the Committee has
considered Mr. Mendelson's other successful business activities unrelated to the
Company.
Further, the Company's commercial bank has required that the Company retain
Mr. Mendelson's services in order to obtain and retain its credit facility. The
Company's lender has also required that Mr. Mendelson and his family maintain
their present ownership position in the Company in order to retain the credit
facility. These requirements were made at the lender's sole request as part of
the Company's loan agreement with the lender. Accordingly, the Board believes
that it is essential to ensure Mr. Mendelson's
11
<PAGE>
continued management of the Company by providing him with sufficient incentive
to remain as the Company's Chief Executive Officer and to induce him to maintain
his significant investment in the Company.
The Committee is also aware of research and the general business philosophy
that equity ownership by management is essential. Accordingly, because Mr.
Mendelson has made a substantial equity commitment to the Company, the Committee
finds it necessary and appropriate to consider this factor in establishing Mr.
Mendelson's compensation level.
1994 STOCK OPTION GRANTS
As discussed previously in this report, the Committee ascribes to the
corporate philosophy that stock options are an advantageous method of aligning
shareholder and management interests because such options are likely to cause
managers to reap economic reward if shareholders gain. Therefore, the Committee
awarded stock options to certain executive officers, as described in the
foregoing tables.
Submitted by the Nominating and Executive Compensation Committee of the
Company's Board of Directors: Paul F. Manieri, Jacob T. Carwile, Samuel L.
Higginbottom, and Guy C. Shafer.
EMPLOYMENT AGREEMENTS
Thomas S. Irwin and the Company are parties to a key employee termination
agreement which provides a lump sum severance payment equal to two years'
compensation if his employment is terminated within three years after a change
in control of the Company (as defined in the key employee termination agreement)
as a result of such change in control.
12
<PAGE>
PERFORMANCE GRAPH
The SEC requires that the Company include in this Proxy
Statement/Prospectus a line-graph presentation comparing cumulative, five-year
shareholder returns on an indexed basis with the American Stock Exchange Total
Value Index and either a nationally recognized industry standard or an index of
peer companies selected by the Company. For purposes of this performance
comparison, the Board of Directors has approved the (i) Dow Jones Aerospace &
Defense Group Index, which is comprised of twelve companies which make air
transportation vehicles, major weapons, defense equipment or defense radar
systems and (ii) the Dow Jones Medical/Biotechnology Group Index, which is
comprised of four companies which are engaged either in genetic research and/or
the marketing and development of recombinant DNA Products or in the development
of advanced technology medical equipment.
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
-----------------------------------------
AMONG HEICO CORPORATION, AMERICAN STOCK EXCHANGE VALUE INDEX,
DOW JONES AEROSPACE GROUP INDEX AND
DOW JONES MEDICAL/BIOTECHNOLOGY GROUP INDEX
<TABLE>
<CAPTION>
FYE October 31,
-------------------------------------------------------------
1989 1990 1991 1992 1993 1994
------- ------ ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
HEICO Common Stock............................. $100.00 $75.38 $105.33 $116.89 $129.19 $ 89.16
American Stock Exchange Value Index............ $100.00 $77.66 $104.51 $103.01 $129.92 $123.74
Dow Jones Aerospace Group...................... $100.00 $91.62 $116.16 $105.33 $164.84 $197.71
Dow Jones Medical/Biotechnology................ $100.00 $ 97.03 $ 86.83 $100.08
</TABLE>
13
<PAGE>
SELECTION OF AUDITORS
The Board of Directors has not yet selected an independent public
accounting firm to serve as the Company's auditors for fiscal 1995. The Board is
expected to decide on this matter shortly after the 1995 annual meeting.
Representatives of Deloitte & Touche LLP, the Company's auditors since
fiscal 1990, are expected to be present at the annual meeting. Such
representatives will have an opportunity to make a statement, if they desire to
do so, and will be available to answer questions that may be asked by
shareholders.
PROPOSALS OF SHAREHOLDERS
If any shareholder of the Company wishes to present a proposal for action
at the Company's annual meeting of shareholders presently scheduled for March
19, 1996, notice of such presentation must be received by the Company at its
principal executive office, 3000 Taft Street, Hollywood, Florida 33021, on or
before October 20, 1995.
GENERAL AND OTHER MATTERS
Neither HEICO Corporation nor the members of its Board of Directors intend
to bring before the meeting any matters other than those referred to in the
accompanying Notice of Meeting. They have no present knowledge that any other
matters will be presented to be acted on pursuant to your proxy. However, if any
other matters properly come before the meeting, the persons whose names appear
in the enclosed form of proxy intend to vote the proxy in accordance with their
judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
Laurans A. Mendelson
Chairman of the Board, President
and Chief Executive Officer
14
