<PAGE> 1
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:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only
[x] Definitive Proxy Statement (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
</TABLE>
AMERICAN VANGUARD CORPORATION
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(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] Fee not 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:
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<PAGE> 2
AMERICAN VANGUARD CORPORATION
4695 MACARTHUR COURT, SUITE 1250
NEWPORT BEACH, CALIFORNIA 92660
May 19, 1997
Dear Shareholder:
You are cordially invited to attend the Company's Annual Meeting of
Shareholders.
As shown in the enclosed formal notice, the meeting will be held at the
Sutton Place Hotel, 4500 MacArthur Boulevard, Newport Beach, California, on
June 19, 1997 at 1:00 p.m. In addition to action on the matters described in
the Proxy Statement, we will discuss at the meeting events of the last year and
our objectives for the current year. There will also be an opportunity to ask
questions of your management and directors about the business of the Company.
The formal notice of the meeting, the Proxy Statement, and the
Company's Annual Report follow. We trust that after reading them, you will
sign and mail the enclosed proxy so that your shares will be represented at
the meeting. A prepaid return envelope is provided for this purpose.
We are grateful for your continuing interest in the Company and look
forward to seeing you at the meeting.
Sincerely,
AMERICAN VANGUARD CORPORATION
/s/ ERIC G. WINTEMUTE
-------------------------------------
Eric G. Wintemute
President and Chief Executive Officer
<PAGE> 3
AMERICAN VANGUARD CORPORATION
4695 MacArthur Court, Suite 1250
Newport Beach, CA 92660
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
To Be Held June 19, 1997
To the Shareholders of American Vanguard Corporation:
The Annual Meeting of the Shareholders (the "Annual Meeting") of
American Vanguard Corporation, a Delaware corporation, will be held at the
Sutton Place Hotel, 4500 MacArthur Boulevard, Newport Beach, California, on
Thursday, June 19, 1997, at 1:00 p.m., for the following purposes:
1. To elect seven directors for the ensuing year; and
2. To transact such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof.
Only shareholders of record at the close of business on May 16, 1997,
are entitled to notice of and to vote at the Annual Meeting and any
adjournments thereof. A copy of the Company's Annual Report, including financial
statements for the year ended December 31, 1996, is enclosed with this Notice.
All shareholders who find it convenient to do so are cordially invited
to attend the meeting in person.
Whether or not you expect to attend the Annual Meeting, you are urged
to sign, date, and return the enclosed proxy in the enclosed postage paid
return envelope. All shares represented by the enclosed proxy, if the proxy is
properly executed and returned, will be voted as you direct. If you attend the
Annual Meeting and inform the Secretary of the Company that you wish to vote
your shares in person, your proxy will be revoked.
By Order of the Board of Directors
/s/ JAMES A. BARRY
---------------------------------------
James A. Barry
Vice President, Chief Financial Officer,
Treasurer and Asst. Secretary
Newport Beach, California
May 19, 1997
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING. PLEASE
COMPLETE AND RETURN THE PROXY IN THE ENCLOSED ENVELOPE AS SOON AS POSSIBLE.
<PAGE> 4
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AMERICAN VANGUARD CORPORATION
4695 MACARTHUR COURT
NEWPORT BEACH, CALIFORNIA 92660
_____________
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 19, 1997
PROXY SOLICITATION BY THE BOARD OF DIRECTORS
This statement is furnished in connection with the Annual Meeting of
Shareholders to be held at the Sutton Place Hotel, 4500 MacArthur Boulevard,
Newport Beach, California, at 1:00 p.m on June 19, 1997. Shareholders of
record at the close of business on May 16, 1997 will be entitled to vote at the
meeting.
Proxies are being solicited by the Board of Directors of the Company.
The Company will bear all costs of the solicitation. The Company does not
intend to solicit proxies other than by use of the mail, but certain officers
and other employees of the Company or its subsidiaries, without additional
compensation, may use their personal efforts, by telephone, telecommunication,
or other similar means to obtain proxies. If the proxy is executed and
returned, the shares represented by the proxy will be voted as specified
therein. If a proxy is signed and returned without specifying choices, the
shares will be voted "FOR" the election of each nominee for director as set
forth in the Notice of Annual Meeting and in the proxies' discretion as to
other matters that may properly come before the Annual Meeting.
Any shareholder who executes and returns a proxy has the power to
revoke such proxy at any time before it is voted by mailing a signed instrument
revoking the proxy to the Secretary, American Vanguard Corporation, 4695
MacArthur Court, Suite 1250, Newport Beach, California 92660. A stockholder
may attend the meeting in person, withdraw the proxy and vote in person.
Attendance at the Annual Meeting will not, in and of itself, constitute
revocation of a proxy. This Proxy Statement is being mailed to shareholders on
or about May 19, 1997.
The Board of Directors has fixed the close of business on May 16,
1997, as the record date for the purpose of determining the shareholders
entitled to notice of and to vote at the Annual Meeting. The Company has only
two authorized classes of shares, Preferred and Common Stock, each with a par
value of $0.10 per share. There are 400,000 shares of Preferred Stock
authorized, none of which have been issued. There are 10,000,000 shares of
Common Stock authorized, and, as of May 16, 1997,
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1
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2,507,829 are outstanding. Each shareholder will be entitled to one vote, in
person or by proxy, for each share standing in their name on the Company's
books as of the record date. Each holder of Common Stock may cumulate their
votes for directors giving one candidate a number of votes equal to the product
of the number of directors to be elected times the number of shares of Common
Stock held by such holder, or they may distribute their votes on the same
principle among as many candidates as they shall see fit. For a holder of
Common Stock to exercise their cumulative voting rights, they must give notice
at the Annual Meeting, prior to the commencement of voting, of their intention
to cumulate their votes. If any holder of Common Stock gives such notice, then
every holder of Common Stock entitled to vote may cumulate their votes for
candidates in nomination.
The seven directors to be elected by the holders of Common Stock shall
be the seven candidates receiving the highest number of votes cast by holders
of Common Stock. Discretionary authority to cumulate votes is hereby solicited
by the Board and return of the Proxy shall grant such authority.
Shares represented by proxies which are marked "withhold authority" or
to deny discretionary authority on any matter will be counted as shares present
for purposes of determining the presence of a quorum; such shares will also be
treated as shares present and entitled to vote, which will have the same effect
as a vote against any such matter. Proxies relating to "street name" shares
which are not voted by brokers on one or more matters will not be treated as
shares present for purposes of determining the presence of a quorum unless they
are voted by the broker on at least one matter. Such non-voted shares will not
be treated as shares represented at the meeting as to any matter for which non-
vote is indicated on the broker's proxy.
ELECTION OF DIRECTORS
The Board of Directors of the Company is elected annually. The
Certificate of Incorporation and Bylaws of the Company currently provide that
the number of directors of the Company shall not be more than nine nor less
than five. The Board has determined by resolution, that it shall consist of
seven members. Seven directors are to be elected at the Annual Meeting and
will hold office from the time of the election until the next Annual Meeting
and until their respective successors are duly elected and qualified, or until
their earlier resignation or removal. In the event that any nominee is unable
or unwilling to serve as a director for any reason not presently known or
contemplated, the proxy holders will have discretionary authority in that
instance to vote the proxies for a substitute(s).
The following sets forth the names and certain information with
respect to the persons nominated for election as directors, all of whom have
had the same principal occupation for more than the past five years, except as
otherwise noted. All such nominees have consented to serve, and all nominees
are now directors, and were elected by the shareholders at the 1996 Annual
Meeting of Shareholders.
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THE AMERICAN VANGUARD BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS
VOTE FOR THE ELECTION AS DIRECTORS OF THE NOMINEES LISTED BELOW.
DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
A brief biography of each director, nominee and executive officer is presented
below.
HERBERT A. KRAFT has served as Co-Chairman of the Board since July 1994. Mr.
Kraft served as Chairman of the Board and Chief Executive Officer from 1969 to
July 1994. Age 73.
GLENN A. WINTEMUTE has served as Co-Chairman of the Board since July 1994. Mr.
Wintemute served as President of the Company and all operating subsidiaries
from 1984 to July 1994 and was elected a director in 1971. He served as
President of Amvac Chemical Corporation ("AMVAC") from 1963 to July 1994. Age
72.
ERIC G. WINTEMUTE has served as a director since June 1994. Mr. Wintemute has
also served as President and Chief Executive Officer since July 1994. He was
appointed Executive Vice President and Chief Operating Officer of the Company
in January 1994, upon the Company's acquisition of GemChem, Inc. ("GEMCHEM").
He co-founded GEMCHEM, a national chemical distributor, in 1991 and served as
its President. Mr. Wintemute was previously employed by AMVAC from 1977 to
1982. From 1982 to 1991, Mr. Wintemute worked with R. W. Greeff & Co., Inc., a
former distributor of certain of AMVAC's products. During his tenure with R.
W. Greeff & Co., Inc., he served as Vice President and Director. He is the son
of the Company's Co-Chairman, Glenn A. Wintemute. Age 41.
JAMES A. BARRY has served as a director since 1994. Mr. Barry was appointed
Treasurer in July 1994. He has served as Chief Financial Officer of the
Company and all operating subsidiaries since 1987, and as Vice President and
Assistant Secretary since 1990. From 1990 to July 1994, he also served as
Assistant Treasurer. Age 46.
GLENN E. MALLORY has served as a director of the Company since 1971 and its
Secretary since 1976. Mr. Mallory was appointed Vice President of the Company
in July 1994. He served as Treasurer from 1976 to July 1994. He also served
as Vice President of AMVAC from 1970 to September 1993. Age 87.
DR. ALLAN SASS was elected a director of the Company in June 1996. Dr. Sass is
Chairman and Chief Executive Officer of Environmental Engineering Concept, Inc.
He has also served as Vice President of Technology of Wheelabrator Technologies
(an environmental issues firm) from 1994 through April 1996, and as Vice
President of New Business Development of Wheelabrator Technologies from 1992 to
1994. He was the Chief Executive Officer and Chairman of Westates Carbon
Company, Inc. from 1985 to 1992. Westates Carbon Company, Inc. was acquired by
Wheelabrator Technologies in 1992. From 1968 to 1985, Dr. Sass was with
Occidental Petroleum Corporation serving as President and Chief Executive
Officer of Occidental Oil Shale, reporting directly to Dr. Armand Hammer. Age
58.
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JESSE E. STEPHENSON has served as director of the Company since 1977 (except
for a 10-month period following March 1992). He was the General Manager of
Calhart Corporation, then a wholly-owned subsidiary of the Company, from 1968
to 1978. Mr. Stephenson is retired and is a private investor. Age 73.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors maintains standing Audit, Compensation and
Executive Committees. The names of the committees, their current membership,
and a brief statement of their principal responsibilities are presented below.
Audit Committee - The Audit Committee's function is to meet
periodically with management and the independent auditors to make inquiries
regarding the manner in which the responsibilities of each are being discharged
and to report thereon to the Board of Directors. The current Audit Committee
members are Messrs. Allan Sass and Jesse E. Stephenson.
Compensation Committee - The Compensation Committee is composed of
Messrs. Herbert A. Kraft, Jesse E. Stephenson and James A. Barry. The
Compensation Committee is responsible for setting and implementing annual and
long-term executive compensation policies.
Executive Committee - Members of the Executive Committee are Herbert
A. Kraft, Glenn A. Wintemute, Eric G. Wintemute and James A. Barry. The
Executive Committee acts in place of the Board of Directors between Board
meetings. It is empowered to act on behalf of the Board of Directors when the
Board is not in session, except as such authority is limited by Delaware
Corporation Law or the Bylaws.
Meetings and Attendance - During 1996, the Executive Committee met
more than six times, while the Audit Committee and Compensation Committee each
met twice. The Board of Directors met five times, with all directors/members
being present at each Board and committee meeting.
During 1996, non-employee directors received $2,000 for each regular
or special Board meeting attended and a fee of $1,000 for each Committee
meeting attended. Effective with the election of directors at the Annual
Meeting of Shareholders in June 1996, each board member (Messrs. G. E. Mallory,
A. Sass and J. E. Stephenson -- non-employee directors), other than an employee
or contracted consultant, received an option to purchase up to 2,500 shares of
the Company's Common Stock at an exercise price of $10.75. Additionally,
should any member of the board granted 2,500 shares, as a result of their June
1996 election, be re-elected to a succeeding term, an additional option for
1,000 shares will be granted on the date of the board member's re-election.
The exercise price per share shall be the closing price as of the close of
business on the day immediately preceding the date the board member is
re-elected. The options may be exercised in whole or in part from time to
time, within five years from the date of the grant, provided that such option
shall lapse and cease to be exercisable as a result of the resignation of or
failure to be re-elected, in which event such period shall
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not exceed twelve months after the date of resignation or election; or such
option shall lapse and cease to be exercisable immediately as a result of death
or death shall have occurred following the resignation of or failure to be
re-elected and while the option was still exercisable. There were no stock
options exercised during the year ended December 31, 1996.
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BENEFICIAL OWNERSHIP
The following table sets forth certain information, as of May 16, 1997, with
respect to the Common Stock owned by (i) each director or nominee of the
Company and the Named Executive Officers (as defined herein under the heading
"Executive Compensation and Other Information"), (ii) all directors and
executive officers of the Company as a group and (iii) each party known to the
Company to beneficially own more than 5% of the Company's issued and
outstanding Common Stock.
<TABLE>
<CAPTION>
Amount and Nature a
Name of of Beneficial Percent
Beneficial Owner Ownership of Class
- ---------------- --------- --------
<S> <C> <C>
Glenn A. Wintemute 694,985 b 27.7
Herbert A. Kraft 639,295 c 25.5
Goldsmith & Harris, et al 153,560 d 6.1
Jesse E. Stephenson 55,850 e 2.2
Eric G. Wintemute 61,553 f 2.4
James A. Barry 3,667 g --h
Dr. Allan Sass 3,500 i --h
Glenn E. Mallory 2,500 j --h
All Directors and Officers 1,471,350 57.8
as a Group (8 persons)
</TABLE>
__________________________________
a Record and Beneficial.
b This figure includes 22,220 shares of Common Stock owned by Mr. G. A.
Wintemute's minor children for which Mr. Wintemute is a trustee and disclaims
beneficial ownership.
c Mr. Kraft owns all of his shares with his spouse in a family trust,
except as to 1,430 shares held in an Individual Retirement Account.
d The Company has relied on information reported on a Statement on
Schedule 13D filed by Goldsmith & Harris et al. with the Securities and
Exchange Commission as adjusted for the 10% stock dividend issued March 15,
1996.
e Mr. Stephenson owns all of his shares in a family trust. This figure
includes 2,500 shares of Common Stock Mr. Stephenson is entitled to acquire
pursuant to stock options exercisable within sixty days of the filing of this
report.
f This figure includes 24,750 shares of Common Stock Mr. Wintemute is
entitled to acquire pursuant to stock options exercisable within sixty days of
the filing of this report.
g This figure represents shares of Common Stock Mr. Barry is entitled to
acquire pursuant to stock options exercisable within sixty days of the filing
of this report.
h Under 1% of class.
i This figure includes 2,500 shares of Common Stock Dr. Sass is entitled
to acquire pursuant to stock options exercisable within sixty days of the
filing of this report.
j This figure represents shares of Common Stock Mr. Mallory is entitled
to acquire pursuant to stock options exercisable within sixty days of the
filing of this report.
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Section 16(a) of the Securities Exchange Act of 1934, as amended
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 with the Securities and Exchange
Commission ("SEC") and the NASDAQ Stock Market. Officers, directors, and
greater than ten-percent shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file. Based
solely on a review of the copies of such forms received by it during or with
respect to the year ended December 31, 1996, and/or the written representations
from certain reporting persons, the Company believes all persons subject to
these reporting requirements filed the required reports on a timely basis,
except that one report on Form 4 was filed late by Mr. Glenn A. Wintemute.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
The following table sets forth the aggregate cash and other
compensation for services rendered for the years ended December 31, 1996, 1995
and 1994 paid or awarded by the Company and its subsidiaries to the Company's
Chief Executive Officer and each of the four most highly compensated executive
officers of the Company, whose aggregate remuneration exceeded $100,000 (the
"Named Executive Officers").
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SUMMARY COMPENSATION TABLE
--------------------------
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
----------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------- ------ -------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
OTHER RE- SECURITIES ALL
NAME ANNUAL STRICTED UNDERLYING OTHER
AND COMPEN- STOCK OPTIONS/ LTIP COMPEN-
PRINCIPAL SALARY BONUS SATION AWARD(S) SARS PAYOUTS SATION
POSITION YEAR ($) ($) ($)(1) ($) (#) ($) ($)
-------- ---- ------- ------- ------ --------- --------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Eric G. Wintemute 1996 201,306 - - - - - 4,855(4)
President and 1995 172,000 - - - - - 4,993(4)
Chief Executive Officer 1994 140,771 - - - 33,000(2) - 4,990(4)
James A. Barry 1996 129,692 - - - - - 3,457(4)
Vice President, CFO 1995 122,751 - - - 5,500(3) - 4,070(4)
and Treasurer 1994 103,009 - - - - - 3,245(4)
Herbert A. Kraft(5) 1996 - - - - - - 226,923(6)
Co-Chairman 1995 - - - - - - 254,086(6)
1994 142,008 - - - - - 131,857(7)
Glenn A. Wintemute(5) 1996 - - - - - - 226,923(6)
Co-Chairman 1995 - - - - - - 254,086(6)
1994 141,171 - - - - - 131,857(7)
</TABLE>
___________________
(1) No executive officer enjoys perquisites that exceed the lesser of
$50,000, or 10% of such officer's salary.
(2) Represents options to purchase Common Stock of the Company issued
to Eric Wintemute in connection with the acquisition of GemChem, Inc., by the
Company during 1994. The options issued to Mr. Wintemute represent
approximately 43% of the total options issued by the Company in 1994. The
exercise price of the options is $9.09 per share and the options vest one-fourth
on January 15, 1995, 1996, 1997 and 1998 and all options expire on April 15,
1998.
(3) Represents options to purchase Common Stock of the Company. The
options issued to Mr. Barry represent approximately 13% of the total options
issued by the Company in 1995. The exercise price of the options is $6.82 per
share and the options vest one-third on January 18, 1996, 1997 and 1998 and all
options expire on January 18, 2000.
(4) These amounts represent the Company's contribution to the Company's
Retirement Savings Plan, a qualified plan under Internal Revenue Code Section
401(k).
(5) Messrs. Kraft and Wintemute retired from the Company as active
employees in July 1994. The Company entered into consulting agreements with
Messrs. Kraft and Wintemute in July 1994. In 1996 the consulting agreements
were extended for an additional year and now expire in July 2000.
(6) Amounts represent payments received by each individual under his
consulting agreement.
(7) Amounts include $127,164 paid to each individual under his
consulting agreement and the Company's contribution of $4,693 on behalf of each
individual as a retirement savings plan contribution.
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Employment Agreements
Eric G. Wintemute has entered into an employment agreement with the
Company effective as of January 15, 1994 for a four year term expiring on
January 15, 1998. Under the agreement, Mr. Wintemute serves as President and
Chief Executive Officer of the Company and its subsidiaries. Mr. Wintemute is
compensated in accordance with the compensation provisions of his contract,
with such annual increases as may be determined by the Compensation Committee,
in its sole discretion, except that Mr. Wintemute's annual salary will be
increased by not less than an amount equal to the cost of living index during
each year of the agreement. The agreement also granted Mr. Wintemute options
to purchase 33,000 shares of Common Stock at an exercise price of $9.09 per
share (as adjusted). Such options are exercisable at the rate of 8,250 shares
per year on each January 15 commencing with 1995 and ending in 1998, with all
options expiring on April 15, 1998, or earlier in certain circumstances upon
termination of his employment. The agreement also provides Mr. Wintemute with
certain additional benefits which are standard for executives in the industry.
The agreement is terminable by Mr. Wintemute upon thirty days written notice to
the Company, and is terminable by the Company, provided that if the agreement
is terminated by the Company due to death or disability, the Company will
continue to pay Mr. Wintemute his annual salary for a period of one year from
the date of such termination. If the agreement is terminated by the Company
without "cause," Mr. Wintemute will continue to receive his annual salary for
the remaining term of the agreement.
In connection with their retirement from the Company as active
employees in July 1994, Messrs. Herbert A. Kraft and Glenn A. Wintemute entered
into written consulting agreements with the Company effective July 14, 1994.
Pursuant to the original consulting agreements, Messrs. Kraft and Wintemute
are to perform management and financial consulting services for the Company as
assigned by the Board of Directors or the Chief Executive Officer for a term
originally scheduled to end on July 14, 1999. By consent of the Company's
Board of Directors in April 1996, Messrs. Kraft's and Wintemute's contracts
were extended one year. The agreements will now expire on July 14, 2000. The
agreements provide that neither Messrs. Kraft or Wintemute will be required to
expend more than 400 hours in any twelve month period or forty hours in any one
month period. Under the agreement, Messrs. Kraft and Wintemute each received
$287,500 for the year ended July 14, 1995 and $243,750 for the year ended July
14, 1996. They will also, under the agreements, each receive $200,000 for the
year ending July 14, 1997, $156,250 for the year ending July 14, 1998, $112,500
for the year ending July 14, 1999 and $100,000 for the year ending July 14,
2000. In the event of death or disability prior to July 14, 2000, such
payments will continue to be paid to the individual or his estate, as
applicable. The agreements also provide for continuation of medical and dental
insurance benefits until the expiration of the term of the agreements.
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Stock Option Grants
No stock options were granted to the Named Executive Officers during
the year ended December 31, 1996.
Stock Option Exercises
There were no stock options exercised by the Named Executive Officers during
the year ended December 31, 1996.
Compensation Interlocks and Insider Participation
The Compensation Committee of the Board consists of Messrs. Herbert A.
Kraft, Jesse E. Stephenson and James A. Barry. Mr. Kraft, in addition to being
a director, is the Co-Chairman. Mr. Barry, in addition to being a director,
serves as Vice President, Chief Financial Officer, Treasurer and Assistant
Secretary of the Company. Mr. Stephenson, in addition to being a director, was
formerly General Manager of Calhart Corporation, then a wholly-owned subsidiary
of the Company, from 1968 to 1978.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board consists of Messrs. Herbert A.
Kraft, Jesse E. Stephenson and James A. Barry. The Compensation Committee sets
and administers the policies which govern annual and long-term executive
compensation. The Committee is responsible for the design and implementation
of salary and incentive programs for executive officers and other key
officers/employees/personnel which are consistent with American Vanguard's
overall compensation philosophy. Key elements of that philosophy include:
o Assuring that total compensation levels are competitive with
those at peer companies and are commensurate with relative
shareholder returns and the Company's financial performance.
o Focusing executives on the financial objectives that support
total shareholder returns.
o Emphasizing long-term financial performance and sustained
market value creation vs. short-term gains.
The compensation of Mr. Eric Wintemute, the Company's Chief Executive
Officer, was based on the terms of his written employment agreement with the
Company entered into in January 1994. In considering and approving the
employment agreement and the cash compensation to be paid thereunder, the Board
considered the level of responsibility and accountability of the Chief
Executive Officer and competitive salaries paid by peer companies, but did not
specifically consider the relationship of Company performance to such
compensation. In granting future salary increases in excess of the
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minimum cost of living increases required by the agreement, the Compensation
Committee will consider Company performance, as well as the additional factors
set forth above. See "Employment Agreements" elsewhere in this Proxy Statement
for a description of Mr. Wintemute's employment agreement.
Since July 1994, the compensation of Mr. Glenn Wintemute and Mr.
Herbert Kraft, has been based on the terms of their written consulting
agreements with the Company, and such compensation is not related to future
Company performance. See "Employment Agreements" elsewhere in this Proxy
Statement for a description of such consulting agreements.
With respect to the other executive officers, the compensation program
presently in effect deals with short-term cash compensation which attempts to
pay such officers competitively. With respect to long-term incentive
compensation, upon the Committee's recommendation, the Board adopted, and the
shareholders approved in 1995, the Company's 1994 Stock Incentive Plan (the
"Plan") which is designed to link such officers' and other key employees'
long-term financial interests to those of the shareholders. The Committee
expects to consider future various cash incentive compensation programs
specifically tied to Company performance for the employees as a potential
method of rewarding the achievement of specific Company performance based
goals. It has not been finally determined if or when such other incentive
programs will be put in place.
The foregoing report has been furnished by the Board of Directors,
Messrs. J. A. Barry, H. A. Kraft, G. E. Mallory, A. Sass, J. E. Stephenson, E.
G. Wintemute and G. A. Wintemute.
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STOCK PERFORMANCE GRAPH
-----------------------
The following graph presents a comparison of the cumulative, five-year
total return for the Company, the S&P 500 Stock Index, and a peer group
selected by Value Line (Chemical--Specialty Industry). The graph assumes that
the beginning values of the investments in the Company, the S&P 500 Stock
Index, and the peer group of companies each was $100. All calculations assume
reinvestment of dividends.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
AMERICAN VANGUARD CORPORATION, STANDARD & POORS 500 AND VALUE LINE CHEMICALS:
SPECIALTY INDEX
(Performance Results Through 12/31/96)
<TABLE>
<CAPTION>
MEASUREMENT AMERICAN VANGUARD STANDARD & POORS
PERIOD CORPORATION 500 CHEMICALS:SPECIALTY
- ----------- ----------------- ---------------- -------------------
<S> <C> <C> <C>
1991 $100 $100 $100
1992 $126.92 $107.79 $114.53
1993 $242.31 $118.66 $127.71
1994 $115.38 $120.56 $126.35
1995 $103.85 $162.03 $156.12
1996 $119.14 $199.70 $179.25
</TABLE>
Assumes $100 invested at the close of trading 12/91 in American Vanguard
Corporation common stock, Standard & Poors 500, and Chemicals: Specialty.
*Cumulative total return assumes reinvestment of dividends.
- --------------------------------------------------------------------------------
12
<PAGE> 16
- --------------------------------------------------------------------------------
INDEPENDENT AUDITORS
The firm of BDO Seidman, LLP ("BDO") were the auditors for the year
ended December 31, 1996. BDO has no direct or indirect material financial
interest in the Company. A representative of BDO is expected to be present at
the Annual Meeting and will be given the opportunity to make a statement if
he/she so desires. The BDO representative will also be available to respond to
appropriate questions raised by those in attendance at the Annual Meeting.
PROPOSALS FOR SUBMISSION AT NEXT ANNUAL MEETING
If any shareholder desires to submit a proposal to fellow shareholders
at the Company's Annual Meeting next year, such proposals must be received by
the Company at its executive offices no later than January 19, 1998 to be
eligible for inclusion in the Company's Proxy Statement and proxy relating to
that meeting.
ANNUAL REPORT ON FORM 10-K
Upon request, the Company will provide without charge to any
beneficial owner of its Common Stock, a copy of its Annual Report on Form 10-K,
excluding exhibits but including financial schedules (if applicable), filed
with the Securities and Exchange Commission with respect to the year ended
December 31, 1996. Requests are to be made to the attention of the Chief
Financial Officer, American Vanguard Corporation, 4695 MacArthur Court, Suite
1250, Newport Beach, California 92660.
OTHER MATTERS
The Company's Annual Report for the year ended December 31, 1996,
accompanies this Proxy Statement. The Board of Directors does not know of any
matter to be acted upon at the Annual Meeting other than the matters described
herein. If any other matter properly comes before the Annual Meeting, the
holders of the proxies will vote thereon in accordance with their best
judgment.
By Order of the Board of Directors
/s/ JAMES A. BARRY
----------------------------------------
James A. Barry
Vice President, Chief Financial Officer
Treasurer and Asst. Secretary
Dated: May 19, 1997
- --------------------------------------------------------------------------------
13
<PAGE> 17
AMERICAN VANGUARD CORPORATION
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The Undersigned hereby appoints ERIC G. WINTEMUTE and JAMES A. BARRY as
Proxies, each with the power to appoint his substitute, and authorizes them to
represent and to vote as designated below, all the shares of common stock of
American Vanguard Corporation held of record by the Undersigned on May 16,
1997, at the Annual Meeting of Shareholders, to be held at the Sutton Place
Hotel, 4500 MacArthur Boulevard, Newport Beach California, on June 19, 1997, or
at any adjournment thereof.
This Proxy, when properly executed, will be voted in the manner directed herein
by the Undersigned shareholder. If no direction is made, this Proxy will be
voted FOR all nominees.
1. ELECTION OF DIRECTORS
[ ] FOR all nominees listed below
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
[ ] WITHHOLD AUTHORITY to vote for the nominees indicted below
(INSTRUCTION: To withhold authority to vote for an individual nominee mark the
box next to the nominee's name below.)
<TABLE>
<S> <C> <C> <C>
[ ] James A. Barry [ ] Herbert A. Kraft [ ] Glenn E. Mallory [ ] Allan Sass
[ ] Jesse E. Stephenson [ ] Eric G. Wintemute [ ] Glenn A. Wintemute
</TABLE>
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
---------------------------------------------
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY
PROMPTLY IN THE POSTPAID ENVELOPE PROVIDED
---------------------------------------------
Please sign exactly as Dated:_____________________, 1997
name appears below
---------------------------------
Signature
[Address label here]
---------------------------------
Signature If Held Jointly
When shares are held by joint tenants, both must sign. When signing as
attorney, executor, administrator, trustee, or guardian, please give your full
title as such. If a corporation, please sign in full corporate name by the
President or other authorized officer. If a Partnership, please sign in the
partnership name by an authorized person.
