NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of Dover Investments
Corporation will be held at 235 Montgomery Street, Conference Room #740,
Seventh Floor, San Francisco, California, on Tuesday, May 5, 1998, at
9:00 A.M., for the following purposes:
(1) To elect four directors (one of whom will be elected by
holders of the Class A Common Stock and three of whom will be elected by
holders of the Class B Common Stock), each to hold office until the next
annual meeting and until his successor has been elected and qualified;
(2) To ratify the appointment of Grant Thornton LLP as the Company's
independent public accountant for the years ended December 31, 1997
and 1998; and
(3) To transact such other business as may properly come before
the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 16,
1998 as the record date for the determination of stockholders entitled to
notice of and to vote at this meeting or any adjournment thereof.
BY ORDER OF THE BOARD OF DIRECTORS
LAWRENCE WEISSBERG
Chairman of the Board of Directors,
President and Chief Executive Officer
San Francisco, California
March 23, 1998
IMPORTANT: To ensure your representation at the meeting please
date, sign and mail the enclosed Proxy card(s) promptly in the return
envelope which has been provided.
DOVER INVESTMENTS CORPORATION
Proxy Statement
for the
Annual Meeting of Stockholders of
DOVER INVESTMENTS CORPORATION
100 Spear Street, Suite 520
San Francisco, California 94105
to be Held on May 5, 1998
The accompanying proxy is solicited on behalf of the Board of
Directors of Dover Investments Corporation (the "Company") for use at the
Annual Meeting of Stockholders (the "Annual Meeting") to be held at 9:00 a.m.
on Tuesday, May 5, 1998, at 235 Montgomery Street, Conference Room #740,
Seventh Floor, San Francisco, California, or any adjournment thereof. Any
stockholder giving a proxy has the power to revoke it at any time prior to
the exercise thereof by filing with any Assistant Secretary of the Company a
written revocation, by attending the Annual Meeting and voting in person, or
by submitting a duly executed proxy bearing a later date. The expense of
soliciting proxies will be paid by the Company. The Company will request
brokers, custodians, nominees and other holders of record to forward
copies of soliciting material to persons for whom they hold shares of Company
stock and to request authority for the execution of proxies. In such cases,
the Company will reimburse holders for their reasonable charges or expenses.
The Company's principal executive office is located at 100 Spear Street,
Suite 520, San Francisco, California 94105. This proxy statement and the
accompanying form(s) of proxy were mailed on or about March 23, 1998.
VOTING RIGHTS
The Board of Directors has fixed the close of business on March 16,
1998 as the record date for determination of stockholders entitled to notice
of and to vote at the Annual Meeting. The voting securities of the Company
outstanding at the close of business on that date were 684,810 shares of
Class A Common Stock and 317,867 shares of Class B Common Stock, each with
a $.01 par value. The Company's Restated Certificate of Incorporation
provides that, so long as the total number of shares of Class B Common Stock
outstanding on any record date for a meeting of stockholders at which
directors are to be elected equals or exceeds 12 1/2% of the total number of
outstanding shares of Common Stock of both classes on such date, the holders
of Class A Common Stock will vote as a separate class to elect 25% of the
Board of Directors (the "Class A Directors") and the holders of the Class B
Common Stock will vote as a separate class to elect the remaining 75% of
the Board of Directors (the "Class B Directors"). If 25% of the authorized
number of directors is not a whole number, then the holders of Class A
Common Stock are entitled to elect the next higher whole number of directors
that is at least 25% of the authorized number of directors. The total number
of outstanding shares of Class B Common Stock on March 16, 1998 constituted
31.70% of the total number of outstanding shares of Common Stock of both
classes. Accordingly, holders of record of Class A Common Stock will vote
as a separate class at the Annual Meeting with respect to the election of
directors and be entitled to elect one Class A Director. Holders of record
of Class B Common Stock, voting as a separate class, will be entitled to
elect the three Class B Directors. Holders of the Class A Common Stock and
of the Class B Common Stock generally will vote together as a single class
on other matters submitted to a stockholders' vote, with the Class A Common
Stock entitled to one vote per share and the Class B Common Stock entitled
to ten votes per share.
The representation in person or by proxy of not less than a majority
of the shares entitled to vote at the meeting will constitute a quorum.
Class A Directors and Class B Directors will be elected by a plurality of the
respective votes cast by holders of Class A Common Stock and Class B Common
Stock. The affirmative vote of a majority of the shares represented at the
meeting is required for the approval and adoption of Proposal 2. Because
abstentions and "non-votes" are counted as present in determining whether
the quorum requirement is satisfied, abstentions and "non-votes" will have
the effect of a vote against a proposal. A "non-vote" occurs when a nominee
holding shares for a beneficial owner votes on one proposal but does not vote
on another proposal because the nominee does not have discretionary voting
power and has not received instructions from the beneficial owner.
A holder of Class A Common Stock or Class B Common Stock may be
entitled to cumulate votes and give one nominee a number of votes equal to
the number of directors to be elected by the Class A Common Stock or the
Class B Common Stock, as applicable, multiplied by the number of votes to
which such stockholder's shares are entitled, or distribute such stockholder's
votes on the same principle among as many nominees as the stockholder thinks
fit. A stockholder may cumulate votes for a nominee or nominees for Class A
or Class B Directors if such nominee or nominees' names have been placed in
nomination prior to the voting at the Annual Meeting and the stockholder has
given notice prior to the voting at the Annual Meeting of the stockholder's
intention to cumulate votes. If any one stockholder has given such notice,
all stockholders may cumulate their votes for nominees.<PAGE>
<TABLE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table shows as of March 16, 1998, (i) persons who are
known by the Company to be beneficial owners of more than 5% of the Company's
Class A or Class B Common Stock, and (ii) for each director and all directors
and officers as a group, the amount and nature of their beneficial ownership
and percentage of all outstanding Class A Common Stock and Class B Common
Stock owned by them:
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Aggregate Voting
Class A Common Percentage of Class B Common Percentage of Power
Shares Outstanding Shares Outstanding Represented by
Position with Beneficially Class A Common Beneficially Class B Common Shares Beneficially
Name and Address Company Owned Shares (1) Owned Shares Owned(2)
Lawrence Weissberg Chairman, 187,446(3) 25.22% 245,114 77.11% 68.30%
100 Spear Street President
Suite 520 and Chief
San Francisco, Executive
CA, 94105 Officer
Arnold Addison Director 1,200(4) * 0 0 *
727 Industrial
Parkway, Hayward,
CA 94544
John Gilbert Director 1,650(5) * 0 0 *
400 Montgomery
Street, #820
San Francisco,
CA 94104
Will C. Wood Director 10,650(6) 1.55% 0 0 *
1550 El Camino
Real # 275
Menlo Park,
CA 94025
Erika Kleczek Principal 1,546(7) * 0 0 *
100 Spear Financial
Steet #520 Officer
San Francisco,
CA 94105
Robert Naify N/A 54,407 7.94% 23,330 7.33% 7.45%
172 Golden
Gate Avenue
San Francisco,
CA 94102
Leeward Capital, N/A 47,500 6.94% 0 0 1.23%
L.P.Leeward
Investmt.,LLC
Eric P. Von der
Porten
1139 San Carlos
Ave., San Carlos,
CA 94070
All current 202,492(8) 29.57% 245,114 77.11% 68.69%
officers and
directors
as a group
(5) persons
</TABLE>
* Less than one percent (1%) of the outstanding class of stock or aggregate
voting power of the Class A Common Stock and Class B Common Stock
combined.
(1) Based on a total of 684,810 currently outstanding shares and the
respective number of shares issuable upon exercise of options owned by
each individual exercisable within 60 days of March 16, 1998.
(2) For matters other than the election of directors only.
(3) Includes 58,334 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998, 7,257 shares of Class A Common Stock,
of which 1,810 shares are owned by Mr. Weissberg's wife, 4,660 shares
are owned by the Weissberg Foundation and 787 shares are held by a trust
for the benefit of the grandchildren of Mr. Weissberg of which Mr.
Weissberg is trustee. Mr. Weissberg disclaims beneficial ownership of
the 1,810 shares owned by his wife.
(4) Includes 1,200 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998.
(5) Includes 1,150 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998.
(6) Includes 750 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998.
(7) Includes 1,501 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998.
(8) Includes 62,935 shares issuable upon exercise of options exercisable
within 60 days of March 16, 1998.
<PAGE>
PROPOSAL 1 -- ELECTION OF DIRECTORS
Nominees for Directors
Action is to be taken at the Annual Meeting with respect to the
election of a total of four directors, consisting of one Class A Director and
three Class B Directors, to serve until the next annual meeting of
stockholders and until their successors are elected and qualified. Holders of
the Class A Common Stock will vote as a separate class for the election of
the Class A Director and holders of the Class B Common Stock will vote as a
separate class for the election of the Class B Directors. Each proxy with
respect to the Class A Director (the proxy card printed with black ink) may
not be voted for more than one nominee and each proxy with respect to the
Class B Directors (the proxy card printed with red ink) may not be voted for
more than three nominees. It is intended that the proxies solicited by and
on behalf of management will be voted for the election of the nominees listed
in the following table. In the event any of the nominees, for any reason,
should cease to be a candidate for a position as a director, the proxies will
be voted in accordance with the best judgment of the person or persons acting
under them and may be voted for another person nominated by management. The
Company knows of no current circumstances which would render any nominee
unable to accept nomination or election. Under the terms of the Company's
By-Laws, a vacancy may be filled by the Board of Directors.
The following table indicates as to each nominee the year when
he was first elected or appointed a director, his age and class of
directorship:
Director Class of
Name Since Age Directorship
Arnold Addison 1992 68 Class A
John Gilbert 1993 58 Class B
Lawrence Weissberg 1968 77 Class B
Will C. Wood 1992 58 Class B
Mr. Weissberg may be deemed to be a control person of the
Company under the Securities Exchange Act of 1934.
Arnold Addison. Mr. Addison has been President of Addison
Financial Corporation, an auto leasing company, since October 1987. He has
also been the owner of Warm Springs Land Co., a real estate investment firm,
since January 1985.
John Gilbert. Mr. Gilbert has been a self-employed financial
consultant since 1989 and has seventeen years of experience as a general
contractor and home builder.
Lawrence Weissberg. Mr. Weissberg is presently the Chairman
of the Board of Directors, President and Chief Executive Officer of the
Company. He was the President and Chief Executive Officer of the Company and
Homestead Savings, A Federal Savings and Loan Association (hereafter referred
to as the "Association"), from 1960 to 1973 and from 1975 to 1989. In May
1989, Mr. Weissberg stepped down as President of the Company and the
Association, although he continued to serve as Chairman of the Board of
Directors and Chief Executive Officer of the Company. In August 1991,
Mr. Weissberg was re-appointed President of the Company. Mr. Weissberg
stepped down as Chief Executive Officer of the Association in August 1989
and as Chairman of the Board of Directors and as a director of the
Association in January 1992.
Will C. Wood. Mr. Wood has been a principal of Kentwood
Associates, a financial advisory firm, since November 1993. He was an
international banking executive with Wells Fargo Bank, Crocker Bank and
Citibank from 1972 through 1989 and was managing Director of IDI Associates
from 1989 to 1993.
Committees and Meetings of the Board of Directors
In 1997, the Board of Directors of the Company held five
regular meetings. Each of the directors attended at least 75% of the meetings
of the Board of Directors held during the period for which he has been a
director.
The Board of Directors of the Company established a
Compensation Committee in January 1995. The Compensation Committee of the
Board of Directors consists of Arnold Addison and Will C. Wood. The
Compensation Committee reviews and sets company policies in addition to
recommending to the Board the level of compensation of the President. The
Compensation Committee held one meeting during fiscal 1997.
Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires
the Company's officers and directors, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership of equity securities of the
Company with the Securities and Exchange Commission (the "SEC").
Based solely on the Company's review of the reporting forms
received by it, and written representations from certain persons that no
Form 5 reports were required to be filed by those persons, the Company
believes that during the period from January 1, 1997 to December 31, 1997,
inclusive, all filing requirements applicable to officers, directors and
greater than ten percent stockholders were satisfied. Ms. Kleczek filed
such a report after its due date.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE
"FOR" EACH OF THE NOMINEES.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Compensation of Executive Officers
The cash compensation of the only executive officer of the
Company whose total cash compensation exceeded $100,000 in 1997 for services
in all capacities to the Company and its subsidiaries during 1995, 1996
and 1997 was as follows:
SUMMARY COMPENSATION TABLE
Name and Annual
Principal Compensation All Other
Position Year Salary($) Compensation ($)
Lawrence Weissberg 1997 150,000 5,515(1)
Chairman of the 1996 150,000 5,515(1)
Board of Directors, 1995 150,000 5,460(1)
President and Chief
Executive Officer
___________________________
(1) Consists of an automobile allowance.
Stock Option Plan
Under the Company's 1995 Stock Option Plan (the "Plan"), stock
options may be granted to certain officers and key employees. The Plan is
administered by the Compensation Committee. Options granted under the Plan
provide for the purchase of shares of the Company's Common Stock, at the
fair market value of the stock on the date the option is granted. In the
case of a stock option held by an optionee who, on the date of grant of such
option, owns more than 10% of the total combined voting power of all classes
of stock of the Company, the exercise price will be not less than 110% of
the fair market value of the stock. Options granted under the Plan will be
exercisable during a period fixed by the Compensation Committee, provided
that no nonqualified stock options will be exercisable before the expiration
of six months from the date of grant and no incentive stock option will be
exercisable before the expiration of one year from the date of grant.
No option will be exercisable after the expiration of ten years from the
date of grant. The Plan provides that no option is exercisable after the
expiration of five years from the date of grant in the case of an incentive
stock option held by an optionee who, on the date of grant, owns more than
10% of the total combined voting power of all classes of stock of the Company.
Compensation of Directors
The Company pays each nonemployee director $750 for each meeting of
the Board of Directors of the Company attended. None of the Company's
directors, other than Mr. Weissberg, are employees of the Company.
Nonemployee directors receive stock options pursuant to the
Company's Stock Option Plan for Nonemployee Directors (the "Director Plan").
Under the Director Plan, each nonemployee director is automatically granted
options to purchase 500 shares of Common Stock on each anniversary date of
his or her appointment, until the plan terminates or the director ceases
to be a director. Options granted under the Director Plan become exercisable
in installments to the extent of one-half on the date one year after the date
of grant, and the remaining one-half on the date two years after the date of
grant. The exercise price for shares subject to options granted under the
Director Plan is the fair market value of the shares at the date of the
option grant.
CERTAIN TRANSACTIONS
The Company entered into an agreement to sublease to another
Corporation owned by Mr. Weissberg, a portion of the premises. That
corporation's share of the lease equals 35% of the total rent and operating
costs.
PROPOSAL 2 -- RATIFICATION OF ACCOUNTANTS
The Company has engaged Grant Thornton LLP as the Company's
independent public accountant to audit its financial statements for the years
ended December 31, 1997 and 1998.
Representatives of Grant Thornton LLP are expected to be
present at the Annual Meeting, will have an opportunity to make a statement
if they desire to do so, and will be available to respond to appropriate
stockholder questions.
Required Vote
A vote FOR Proposal 2 by the holders of a majority of the
outstanding shares of the Company's Class A Common Stock and Class B Common
Stock, present at the Annual Meeting in person or by proxy and voting
together as a single class with holders of the Class A Common Stock casting
one vote per share and holders of the Class B Common Stock casting ten votes
per share, is required to approve and adopt the proposal. Votes with respect
to this proposal will be cast as specified in the proxy. If no specification
is made, votes represented by proxy will be cast FOR the proposal.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE
"FOR" PROPOSAL 2.
STOCKHOLDER PROPOSALS
Any proposals of stockholders intended to be presented at
the 1999 Annual Meeting must be received by the Company by December 8, 1998
in order to be included in the Company's proxy materials relating to that
meeting.
OTHER MATTERS
Management knows of no business other than that mentioned above
to be transacted at the Annual Meeting, but if other matters are properly
raised before the Annual Meeting it is the intention of the persons named in
the enclosed proxy, in the absence of instructions to the contrary, to vote
in regard thereto in accordance with their judgment; discretionary authority
to do so is included in the proxy.