<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
- --------------------------------------------------------------------------------
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:
<TABLE>
<S> <C>
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to Section 240.14a-11(c) or Section 240.14a-12
</TABLE>
PREMIER PARKS INC.
- --------------------------------------------------------------------------------
(Name of Registrant to Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth 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:
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[ ] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE> 2
PRELIMINARY COPIES
DATED APRIL 7, 2000
PREMIER PARKS INC.
11501 NORTHEAST EXPRESSWAY
OKLAHOMA CITY, OKLAHOMA 73131
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
------------------------
JUNE 15, 2000
------------------------
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Premier
Parks Inc. (the "Company") will be held at the Hotel Intercontinental, 111 East
48th Street, New York, New York 10017, on Thursday, June 15, 2000, at 10:00
a.m., E.D.T., for the following purposes, all as more fully described in the
attached Proxy Statement:
1. To elect seven directors to serve for the ensuing year and until
their respective successors are elected and qualified.
2. To approve an amendment to the Company's Certificate of Incorporation
to change the name of the Company to "Six Flags, Inc."
3. To approve an amendment to the Certificate of Incorporation of the
Company's principal direct subsidiary, Premier Parks Operations Inc.
("PPO"), to change the name of PPO to "Six Flags Operations Inc."
4. To approve the transfer by PPO to its wholly-owned subsidiary, Six
Flags Theme Parks Inc. ("SFTP"), of all of the capital stock owned by
PPO of the Company's subsidiaries that indirectly own the Company's
international parks.
5. To ratify the selection by the Company's Board of Directors of KPMG
LLP as independent public accountants of the Company for the year
ending December 31, 2000.
6. To transact such other business as may properly come before the
meeting and any and all adjournments thereof.
The Board of Directors has fixed the close of business on April 19, 2000 as
the record date for the determination of stockholders entitled to notice of, and
to vote at, the meeting or any adjournment thereof.
A copy of the Company's Annual Report for the year ended December 31, 1999
is enclosed.
YOU ARE EARNESTLY REQUESTED TO DATE, SIGN AND RETURN THE ACCOMPANYING FORM
OF PROXY IN THE ENVELOPE ENCLOSED FOR THAT PURPOSE (TO WHICH NO POSTAGE NEED BE
AFFIXED IF MAILED IN THE UNITED STATES) WHETHER OR NOT YOU EXPECT TO ATTEND THE
MEETING IN PERSON. THE PROXY IS REVOCABLE BY YOU AT ANY TIME PRIOR TO ITS
EXERCISE AND WILL NOT AFFECT YOUR RIGHT TO VOTE IN PERSON IN THE EVENT YOU
ATTEND THE MEETING OR ANY ADJOURNMENT THEREOF. THE PROMPT RETURN OF THE PROXY
WILL BE OF ASSISTANCE IN PREPARING FOR THE MEETING AND YOUR COOPERATION IN THIS
RESPECT WILL BE APPRECIATED.
BY ORDER OF THE BOARD OF DIRECTORS
RICHARD A. KIPF
Secretary
Oklahoma City, Oklahoma
April 25, 2000
<PAGE> 3
PREMIER PARKS INC.
11501 NORTHEAST EXPRESSWAY
OKLAHOMA CITY, OKLAHOMA 73131
------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 15, 2000
------------------------
This Proxy Statement and the accompanying proxy are being furnished to
holders of common stock ("stockholders") of PREMIER PARKS INC. (the "Company")
in connection with the solicitation of proxies by the Board of Directors for use
in voting at the Annual Meeting of Stockholders (the "Annual Meeting") to be
held at the Hotel Intercontinental, 111 East 48th Street, New York, New York
10017, on Thursday, June 15, 2000, at 10:00 a.m., E.D.T., and at any and all
adjournments thereof.
If the enclosed proxy is properly signed and returned, your shares will be
voted on all matters that properly come before the Annual Meeting for a vote. If
instructions are specified in your signed proxy with respect to the matters
being voted upon, your shares will be voted in accordance with your
instructions. If no instructions are so specified, your shares will be voted FOR
the election of the nominees named in Proposal 1, FOR the approval of Proposal 2
(amendment to the Company's Certificate of Incorporation to change its name to
"Six Flags, Inc."), FOR the approval of Proposal 3 (amendment to the Certificate
of Incorporation of Premier Parks Operations Inc., the Company's principal
direct subsidiary ("PPO"), to change its name to "Six Flags Operations Inc."),
FOR the approval of Proposal 4 (transfer of the capital stock of the entities
that indirectly own the Company's international parks from PPO to its
wholly-owned subsidiary, Six Flags Theme Parks Inc. ("SFTP")) and FOR the
approval of Proposal 5 (ratification of independent public accountants for the
year ending December 31, 2000). Your proxy may be revoked at any time prior to
being voted by: (i) filing with the Secretary of the Company (Richard A. Kipf),
at the above address, written notice of such revocation, (ii) submitting a duly
executed proxy bearing a later date or (iii) attending the Annual Meeting and
giving the Secretary notice of your intention to vote in person.
On or about April 25, 2000, this Proxy Statement and the accompanying
proxy, together with a copy of the Annual Report of the Company for the year
ended December 31, 1999, including financial statements, are being mailed to
each stockholder of record at the close of business on April 19, 2000 (the
"Record Date").
WHETHER OR NOT YOU ATTEND THE ANNUAL MEETING, YOUR VOTE IS IMPORTANT.
ACCORDINGLY, YOU ARE ASKED TO SIGN AND RETURN THE ACCOMPANYING PROXY REGARDLESS
OF THE NUMBER OF SHARES YOU OWN. Shares can be voted at the Annual Meeting only
if the holder is represented by proxy or is present.
<PAGE> 4
VOTING SECURITIES
The Board of Directors has fixed the close of business on April 19, 2000 as
the Record Date for the determination of stockholders entitled to notice of, and
to vote at, the Annual Meeting. Only stockholders of record at the close of
business on that date will be entitled to vote at the Annual Meeting or any and
all adjournments thereof. As of that date, the Company had issued and
outstanding shares of Common Stock, the Company's only class of
outstanding securities entitled to vote at the Annual Meeting. Each stockholder
of the Company will be entitled to one vote for each share of Common Stock
registered in its name on the Record Date. A majority of all of the outstanding
shares of Common Stock constitutes a quorum at the Annual Meeting.
Neither abstention votes nor any broker non-votes (i.e., votes withheld by
brokers on non-routine proposals in the absence of instructions from beneficial
owners) will be counted as present or represented at the Annual Meeting for
purposes of determining whether a quorum exists.
STOCK OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL HOLDERS
The following table sets forth certain information as of March 1, 2000
(except as noted below) as to Common Stock owned by (a) each of the Company's
current directors and nominees to serve as directors, (b) all current directors
and officers of the Company as a group, and (c) each person who, to the best of
the Company's knowledge, beneficially owned on that date more than 5% of the
outstanding Common Stock.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- ------------------------------------ ------------------ ----------
<S> <C> <C>
Paul A. Biddelman(1)........................................ 45,984 *
Kieran E. Burke(2).......................................... 811,163 1.0
James F. Dannhauser(3)...................................... 370,000 *
Michael E. Gellert(4)....................................... 2,739,253 3.5
Sandy Gurtler............................................... -- --
Francois Letaconnoux........................................ -- --
Stanley S. Shuman........................................... 40,000 *
Gary Story(5)............................................... 359,215 *
Charles R. Wood(6).......................................... 18,182 *
Janus Capital Corporation(7)................................ 10,001,395 12.7
100 Fillmore Street, Suite 300
Denver, Colorado 80206-4923
FMR Corp.(8)................................................ 8,820,820 11.2
82 Devonshire Street
Boston, Massachusetts 02109
College Retirement Equities Fund(9)......................... 5,439,492 6.9
730 Third Avenue
New York, New York 10017
Gilder Gagnon Howe & Co. LLC(10)............................ 4,400,579 5.6
1775 Broadway
New York, New York 10019
All directors and officers as a group (17 persons)(11)...... 4,708,451 5.9
</TABLE>
2
<PAGE> 5
- ---------------
* Less than one percent.
(1) Does not include: (i) 3,400 shares held for discretionary customer accounts
by Hanseatic Corporation ("Hanseatic"), in which Mr. Biddelman serves as an
executive officer; and (ii) 3,727,390 shares held by Hanseatic Americas
LDC, a Bahamian limited duration company in which the sole managing member
is Hansabel Partners LLC, in which the sole managing member is Hanseatic.
Information is shown for April 1, 2000, as of which date Mr. Biddelman did
not hold voting or investment power with respect to such shares.
(2) Includes 201,163 shares of Common Stock and options to purchase 610,000
shares of Common Stock as to which Mr. Burke has sole voting and investment
power. Does not include 283,350 shares of restricted stock and options to
purchase 540,000 shares which were not vested on March 1, 2000.
(3) Includes 60,000 shares of Common Stock and options to purchase 310,000
shares of Common Stock as to which Mr. Dannhauser has sole voting and
investment power. Does not include 216,650 shares of restricted stock and
options to purchase 510,000 shares which were not vested on March 1, 2000.
(4) Includes 467,203 shares of Common Stock, as to which Mr. Gellert has sole
voting and investment power. Also includes 2,272,050 shares of Common Stock
beneficially owned by Windcrest Partners ("Windcrest") which shares voting
and investment power with its general partners, Michael E. Gellert and
Robert J. Gellert.
(5) Includes 21,590 shares of Common Stock and options to purchase 337,625
shares of Common Stock as to which Mr. Story has sole voting and investment
power. Does not include 250,000 shares of restricted stock and options to
purchase 522,000 shares which were not vested on March 1, 2000.
(6) Represents 11,000 shares of Common Stock held directly by Mr. Wood as to
which he has sole voting and investment power and 7,182 shares of Common
Stock held by Double "H" Hole in the Woods Ranch, Inc., a charitable
organization of which Mr. Wood is Chairman of the Board.
(7) Represents shares held by individual and institutional clients of Janus
Capital Corporation, a registered investment advisor ("Janus Capital"). One
such person, Janus Enterprise Fund, a registered investment company, held
4,068,140 shares, representing 5.2% of the outstanding shares of Common
Stock. Mr. Thomas H. Bailey owns approximately 12.2% of the capital stock
of Janus Capital and serves as its Chairman and President. As a result he
may be deemed to be the beneficial owner of the shares of Common Stock
beneficially held by Janus Capital. Mr. Bailey specifically disclaims such
beneficial ownership. Information is shown as of February 29, 2000 and has
been derived from Amendment No. 1 to Schedule 13G dated March 9, 2000.
(8) Includes 8,723,620 shares of Common Stock beneficially owned by Fidelity
Management & Research Company ("Fidelity"), a wholly-owned subsidiary of
FMR Corp. and a registered investment adviser (including 4,869,200 shares
of Common Stock owned by Fidelity Contrafund). The number of shares of
Common Stock shown includes 1,847,6000 shares of Common Stock into which
923,800 shares of the Company's Premium Income Equity Securities held by
Fidelity on December 31, 1999 are convertible. Edward C. Johnson, Chairman
of FMR Corp. and Abigail Johnson, a director of FMR Corp., and members of
the Johnson family may be deemed to form a controlling group with respect
to FMR Corp. Information is shown as of December 31, 1999 and has been
derived from Amendment No. 1 to Schedule 13G, dated February 14, 2000.
(9) Represents shares beneficially owned by College Retirement Equities Fund, a
registered investment company. Information has been derived from Schedule
13G dated December 31, 1998.
(10) Includes 3,213,769 shares held in customer accounts over which members
and/or employees of Gilder Gagnon Howe & Co. LLC ("GGH") have discretionary
authority to dispose of or direct the disposition
3
<PAGE> 6
of the shares, 1,137,735 shares held in accounts owned by the members of
GGH and their families, and 49,075 shares held in the account of the
profit-sharing plan of GGH. Information is shown as of December 31, 1999
and has been derived from Amendment No. 2 to Schedule 13G dated February
14, 2000.
(11) The share amounts listed include shares of Common Stock that the following
persons have the right to acquire within 60 days from March 1, 2000: Kieran
E. Burke, 610,000 shares (see footnote (1)); James F. Dannhauser, 310,000
shares (see footnote (3)); Gary Story, 337,625 shares (see footnote (5));
and all directors and officers as a group, 1,600,970 shares.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. Section 16(a) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), requires
officers and directors of the Company and persons who own more than ten-percent
of the Common Stock, to file initial statements of beneficial ownership (Form 3)
and statements of changes in beneficial ownership (Forms 4 or 5) of Common Stock
with the Securities and Exchange Commission (the "SEC"). Officers, directors and
greater than ten-percent stockholders are required by SEC regulations to furnish
the Company with copies of all such forms they file.
During 1999, the following officers of the Company inadvertently failed to
make all required filings on a timely basis: James M. Coughlin (General
Counsel), Hue Eichelberger (Executive Vice President), Russell Kuteman (Vice
President) and David Thomas (Vice President); and all such required filings by
the listed officers were subsequently made. To the Company's knowledge, based
solely on its review of the copies of such forms received by it and written
representations from certain reporting persons that no additional forms were
required for those persons, during 1999 all filing requirements applicable to
all other officers, directors, and greater than ten-percent beneficial owners
were complied with.
------------------------
PROPOSAL 1: ELECTION OF DIRECTORS
The Company's Board of Directors currently consists of seven members. At
the Annual Meeting seven directors are to be elected to serve for the ensuing
year and until their respective successors are elected and qualified. The
persons named in the enclosed proxy intend to vote for the election of the
persons listed below, unless the proxy is marked to indicate that such
authorization is expressly withheld. Should any of the listed persons be unable
to accept nomination or election (which the Board of Directors does not expect),
it is the intention of the persons named in the enclosed proxy to vote for the
election of such persons as the Board of Directors may recommend. Proxies cannot
be voted for a greater number of persons than the number of nominees named. The
election of directors requires a plurality vote of the shares of Common Stock
represented at the Annual Meeting.
4
<PAGE> 7
INFORMATION CONCERNING NOMINEES
<TABLE>
<CAPTION>
AGE
AS OF YEAR
MARCH 1, ELECTED
NAME 2000 DIRECTOR POSITION WITH THE COMPANY
---- -------- -------- -------------------------
<S> <C> <C> <C>
Paul A. Biddelman(1)......... 54 1992 Director
Kieran E. Burke(2)........... 42 1989 Chairman of the Board, Chief Executive Officer
and Director
James F. Dannhauser(3)....... 47 1992 Chief Financial Officer and Director
Michael E. Gellert(4)........ 68 1989 Director
Francois Letaconnoux(5)...... 49 -- --
Stanley S. Shuman(6)......... 64 -- --
Gary Story(7)................ 44 1994 Chief Operating Officer, Director and President
</TABLE>
- ---------------
(1) Mr. Biddelman has served as a Director of the Company since December 1992.
Since December 1997, Mr. Biddelman has been president of Hanseatic, a
private investment company. Prior to that date, he was treasurer of
Hanseatic for more than five years. Mr. Biddelman also serves as a director
of Insituform Technologies, Inc., Celadon Group, Inc., and Star Gas
Partners, L.P.
(2) Mr. Burke has served as Chief Executive Officer and a Director of the
Company since October 1989 and Chairman of the Board since June 1994. From
1989 through June 1994, he was President of the Company.
(3) Mr. Dannhauser became Chief Financial Officer of the Company in October 1995
and has served as a Director of the Company since December 1992. From 1990
through June 1996, Mr. Dannhauser was a managing director of Lepercq de
Neuflize & Co. Incorporated, an investment banking firm. Mr. Dannhauser is a
member of the board of directors of Lepercq de Neuflize and of MeriStar
Hospitality Corporation.
(4) Mr. Gellert has served as a Director of the Company since March 1989. He
previously served as a Director of the Company and as a Trustee of Tierco, a
Massachusetts business trust and predecessor of the Company, from 1979 until
1986. From June 1989 through June 1994, he also served as the Chairman of
the Board of the Company. Mr. Gellert is a general partner of Windcrest, a
private investment partnership. Mr. Gellert also serves as a director of
Devon Energy Corp., High Speed Access Corp., Humana Inc., Seacor Smit Inc.
and Smith Barney World Funds.
(5) Mr. Letaconnoux was nominated a director of the Company on March 28, 2000
and will be submitted to the Company's stockholders for election at the
Company's Annual Meeting. Since June 1993, Mr. Letaconnoux has been
President and Chief Executive Officer of Lepercq de Neuflize & Co.
Incorporated, an investment banking firm. Since June 1993, Mr. Letaconnoux
has also served as President and Director of Lepercq Inc., a financial
services company. He is also serves as a trustee to The Lepercq Istel Fund,
Tocqueville Fund and the Asia Pacific Venture Limited II, which are
investment companies and a Director of Pathe, S.A., a French entertainment
company.
(6) Mr. Shuman was nominated a director of the Company on March 28, 2000 and
will be submitted to the Company's stockholders for election at the
Company's Annual Meeting. Mr. Shuman is Executive Vice President, Managing
Director and a Member of the Executive Committee of Allen & Company
Incorporated, a New York based investment company. Mr. Shuman also serves as
a director of the News Corporation Limited, Bayou Steel Corporation, Global
Asset Management (USA), and SESAC, Inc. In
5
<PAGE> 8
addition, Mr. Shuman is a member of the President's Foreign Intelligence
Advisory Board, the Council on Foreign Relations and Chairman of the Center
for NY City Law. He also serves on the board of directors of Carnegie Hall,
The Markle Foundation, The Museum of Television & Radio, the National Public
Radio Foundation, Phillips Academy, and WNET/Channel Thirteen.
(7) Mr. Story has served as President and a Director of the Company since June
1994 and as Chief Operating Officer since January 1992. From January 1992
through June 1994, he also served as the Company's Executive Vice President.
------------------------
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the year ended December 31, 1999, the Company's Board of Directors
held four meetings. During 1999, each of the directors of the Company, except
Mr. Gurtler, attended all of the meetings of the Board of Directors and all
meetings of committees of the Board of which such director was a member. Mr.
Gurtler attended two meetings of the Board of Directors in 1999.
The Board has designated an Executive Committee, a Compensation Committee
and an Audit Committee. The members of the Executive Committee at March 1, 2000
were Messrs. Burke, Biddelman and Gellert. The Executive Committee meets
informally on a regular basis and acted formally during 1999 on five occasions.
Subject to applicable law, the Executive Committee is authorized to take any
action that can be taken by the entire Board.
The members of the Compensation Committee at March 1, 2000 were Messrs.
Biddelman and Gellert. The Compensation Committee, which met three times during
1999, reviews management's recommendations with respect to executive
compensation and employee benefits and is authorized to act on behalf of the
Board with respect thereto. The Compensation Committee also administers the
Company's 1996 Stock Option and Incentive Plan and 1998 Stock Option and
Incentive Plan. See "Executive Compensation."
The members of the Audit Committee at March 1, 2000 were Messrs. Biddelman
and Gellert. If he is elected as a director, the Board of Directors intends to
add Mr. Letaconnoux as a member of the Audit Committee following the Annual
Meeting. The Audit Committee met three times during 1999. In accordance with
recently adopted rules of the SEC, in March 2000 the Board of Directors of the
Company adopted a new charter for its Audit Committee, a copy which is annexed
hereto as Exhibit A.
COMPENSATION OF DIRECTORS
Each of the Company's directors who are not employees or consultants of the
Company receives $20,000 annually for serving on the Board, $4,000 annually for
servicing as a committee chair and $1,000 for each board and committee meeting
attended, payable in cash or shares of Common Stock. With respect to 1999, the
Company paid an aggregate of $69,000 in such fees to its two eligible outside
directors. Directors are also reimbursed for expenses attendant to Board and
Committee membership.
6
<PAGE> 9
EXECUTIVE COMPENSATION
The following table discloses compensation received by the Company's Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer and the
other named executive officers for the years shown.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
RESTRICTED SECURITIES
STOCK UNDERLYING
SALARY BONUS OTHER ANNUAL AWARD(S) OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR ($) ($) COMPENSATION ($)(1)(2) (#)(1) COMPENSATION
- --------------------------- ---- -------- ---------- ------------ ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Kieran E. Burke........... 1999 $754,050 $3,143,276(3) -- -- 350,000 (5)
Chairman of the Board, 1998 594,312 2,786,076(3) -- $10,083,701(4) 350,000 (5)
Chief Executive Officer 1997 400,000 529,692 -- $ 5,482,823(4) -- (5)
and Director
Gary Story................ 1999 $560,626 $2,690,773(3) -- -- 350,000 (5)
President, Chief
Operating 1998 445,552 2,672,913(3) -- $ 8,896,860(6) 350,000 (5)
Officer and Director 1997 300,000 453,438 -- $ 4,837,500(6) -- (5)
James F. Dannhauser....... 1999 $427,429 $2,246,351(3) -- -- 350,000 (5)
Chief Financial Officer 1998 360,070 2,561,771(3) -- $ 7,710,119(7) 350,000 (5)
and Director 1997 250,000 378,546 -- $ 4,192,178(7) -- (5)
Hue W. Eichelberger....... 1999 $205,977 $ 150,000 -- -- 70,000 (5)
Executive Vice President 1998 179,850 100,000 -- -- 115,000 (5)
1997 145,000 140,000 -- -- -- (5)
James M. Coughlin......... 1999 $253,531 $ 150,000 -- -- 70,000 (5)
General Counsel(8) 1998 156,250 125,000 -- $ 350,000 70,000 (5)
</TABLE>
- ---------------
(1) All share information has been adjusted to give effect to a two-for-one
stock split consummated by the Company in July 1998.
(2) Amounts shown are based on the closing price of the Common Stock (as
reported on the New York Stock Exchange ("NYSE")) on the date of the grant
and include all restricted shares granted, without regard to the existence
of restrictions thereon.
(3) Bonus payments for 1999 represent the bonus payment awarded to such
individual under the terms of his employment agreement, entered into in
1997, described below. The contractual payment for each year is based on the
Company's earnings before interest, taxes, depreciation, and amortization
("EBITDA") for such year, excluding amounts generated by parks acquired in
such year, compared to the EBITDA shown in the Company's budget for that
year as approved by its Board of Directors. In 1999, the Company's EBITDA
(as calculated under the employment agreements) was $346.6 million,
representing an $88.3 million (34.2%) increase over actual 1998 levels.
(4) As of December 31, 1999, Mr. Burke had been granted 680,040 restricted
shares of Common Stock, 340,020 of which were granted on July 31, 1997 and
340,020 of which were granted on June 9, 1998, all pursuant to an employment
agreement described below. The restrictions on the restricted shares granted
in 1997 lapse in six annual installments and the restrictions on the shares
granted in 1998 lapse in three annual installments. Dividends will be paid
on the restricted shares whether or not the restrictions thereon have lapsed
if and when such dividends are declared on the Company's Common Stock. Based
on the closing price of the Common Stock (as reported on the NYSE) on
December 31, 1999, the aggregate market value of the remaining shares
subject to restriction total $8,181,731.
7
<PAGE> 10
(5) The Company has concluded that, as to each named executive officer for each
year shown, all personal benefits paid or provided did not exceed the lesser
of $50,000 or 10% of the salary and bonus reported for such officer above.
During 1999, the Company's only defined contribution plans or pension or
other defined benefit or retirement plans in which its officers
participated, were a defined benefit pension plan described below under
"Executive Compensation -- Retirement Plan" and a qualified, contributory
401(k) plan. After specified periods of employment, employees are eligible
to participate in the 401(k) plan. The Company matches 100% of the first 2%
and 25% of the next 6% of salary contributed by employees to the plan. The
accounts of all participating employees are fully vested after completion of
four years of service. Amounts shown as salary for each named executive
officer include the Company's matching contribution for such officer.
(6) As of December 31, 1999, Mr. Story had been granted 600,000 restricted
shares of Common Stock, 300,000 of which were granted on July 31, 1997 and
300,000 of which were granted on June 9, 1998, all pursuant to an employment
agreement described below. The restrictions on the restricted shares granted
in 1997 lapse in six annual installments, and the restrictions on the shares
granted in 1998 lapse in three annual installments. Dividends will be paid
on the restricted shares whether or not the restrictions thereon have lapsed
if and when such dividends are declared on the Company's Common Stock. Based
on the closing price of the Common Stock (as reported on the NYSE) on
December 31, 1999, the aggregate market value of the remaining shares
subject to restriction total $7,218,750.
(7) As of December 31, 1999, Mr. Dannhauser had been granted 519,960 restricted
shares of Common Stock, 259,980 of which were granted on July 31, 1997 and
259,980 of which were granted on June 9, 1998, all pursuant to an employment
agreement described below. The restrictions on the restricted shares granted
in 1997 lapse in six annual installments, commencing in 1998, and the
restrictions on the shares granted in 1998 lapse in three annual
installments, commencing in 1999. Dividends will be paid on the restricted
shares whether or not the restrictions thereon have lapsed if and when such
dividends are declared on the Company's Common Stock. Based on the closing
price of the Common Stock (as reported on the NYSE) on December 31, 1999,
the aggregate market value of the remaining shares subject to restriction
total $6,255,769.
(8) Mr. Coughlin joined the Company as its General Counsel in May 1998. In
connection therewith, he was granted 20,000 restricted shares, the
restrictions on which lapse in three annual installments commencing in 1999.
Dividends will be paid on the restricted shares whether or not the
restrictions thereon have lapsed if and when such dividends are declared on
the Company's Common Stock. Based on the closing price of the Common Stock
(as reported on the NYSE) on December 31, 1999, the aggregate market value
of the remaining shares subject to restriction total $192,481.
RETIREMENT PLAN
In addition to the Company's 401k plan described above, retirement benefits
are provided to the Company's employees, including its named executive officers,
under a funded, tax-qualified defined benefit pension plan known as the Six
Flags Retirement Plan (the "Plan"). The Plan, which had been adopted by Six
Flags prior to its 1998 acquisition by the Company, was extended to
substantially all full-time employees of the Company as of January 1, 1999. In
connection therewith, the Company also decided that employment by the Company
prior to that date would be included in determining years of service under the
Plan.
8
<PAGE> 11
The following table sets out the estimated annual pension benefit payable
under the Plan for a participant at age 65, for various levels of average annual
compensation (as defined below) and years of service.
<TABLE>
<CAPTION>
YEARS OF SERVICE
FIVE YEAR AVERAGE ---------------------------------------------------------
COMPENSATION 5 15 20 25 30 35
- ----------------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$ 200,000.......................... $10,674 $32,021 $42,694 $53,368 $64,041 $74,715
400,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
600,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
800,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
1,000,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
1,500,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
2,000,000......................... 10,674 32,021 42,694 53,368 64,041 74,715
</TABLE>
For purposes of the Plan, average annual compensation is equal to the
average annual salary and bonus over the five highest consecutive years during
the final ten years of employment. However, under the Internal Revenue Code, the
maximum recognizable compensation for 2000 is $170,000. The annual salary and
bonus for the current year for the named executive officers is indicated in the
Summary Compensation Table. The years of service for each of the named executive
officers under the Plan, as of December 31, 1999, are: Mr. Burke, 10.2 years;
Mr. Story, 12.1 years; Mr. Dannhauser, 4.3 years; Mr. Eichelberger, 8.8 years;
and Mr. Coughlin, 1.6 years.
Benefits under the Plan are computed on the basis of a single life annuity
and are payable, subject to reduction, in any annuity form permitted under the
Plan. Benefits are paid from the trust under the Plan, to the extent permitted
by law, and are not subject to reduction for Social Security benefits or other
offset amounts.
AGGREGATE OPTION EXERCISES AND OPTION VALUES
The following table provides information on stock options and warrants
("Options") exercised in 1999 by each of the named executive officers and the
value of such officers' unexercised Options at December 31, 1999:
<TABLE>
<CAPTION>
NUMBER OF SHARES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1999 DECEMBER 31, 1999($)(2)
ACQUIRED ON VALUE ---------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Kieran E. Burke........ 183,078 $6,511,990 689,401 540,000 $12,457,951 $4,367,500
Gary Story............. 21,590 495,084 377,625 522,000 5,143,400 4,045,750
James F. Dannhauser.... 60,000 1,420,313 310,000 510,000 3,788,750 3,831,250
Hue W. Eichelberger.... 13,000 292,625 83,000 129,000 1,064,250 1,073,375
James M. Coughlin...... -- -- 42,000 98,000 386,750 715,750
</TABLE>
- ---------------
(1) Amounts shown represent the closing price of the Common Stock (as reported
on the NYSE) on the date of exercise less the applicable exercise price. The
average weighted closing price used for each named exercised officer was
Kieran E. Burke, $37.09; Gary Story, $27.56; James F. Dannhauser, $27.80 and
Hue W. Eichelberger, $28.75.
(2) Amounts shown is based on $28.875 per share, the closing price of the Common
Stock (as reported on the NYSE) on December 31, 1999.
9
<PAGE> 12
OPTIONS GRANTED IN LAST FISCAL YEAR
The following table provides information on Options granted in 1999 to each
of the named executive officers:
<TABLE>
<CAPTION>
GAINS BASED ON ASSUMED
RATES OF STOCK PRICE
APPRECIATION FOR
1999 STOCK OPTION GRANTS OPTION TERM (1)
--------------------------------------------------- -----------------------
% OF 1999
EMPLOYEE EXERCISE/BASE ASSUMED ASSUMED
OPTIONS OPTION PRICE PER EXPIRATION RATE RATE
NAME GRANTED(2) GRANTS(%) SHARE($) DATE 5% 10%
- ---- ---------- --------- ------------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Kieran E. Burke......... 350,000 10.3% $25.00 12/06/06 $3,563,000 $8,302,000
Gary Story.............. 350,000 10.3 25.00 12/06/06 3,563,000 8,302,000
James F. Dannhauser..... 350,000 10.3 25.00 12/06/06 3,563,000 8,302,000
Hue W. Eichelberger..... 70,000 2.1 25.00 12/06/06 712,600 1,660,400
James M. Coughlin....... 70,000 2.1 25.00 12/06/06 712,600 1,660,400
</TABLE>
- ---------------
(1) The potential gain is calculated from the closing price of the Common Stock
on the date of grant. These amounts represent certain assumed rates of
appreciation only. Actual gains, if any, on Option exercises and Common
Stock holdings are dependent on the future performance of the Common Stock
and overall market conditions.
(2) The Options vest in five equal annual installments commencing on the date of
the grant.
EMPLOYMENT AGREEMENTS
In 1997, the Company entered into employment agreements with each of
Messrs. Burke, Story and Dannhauser, which agreements were amended in 1999 to
extend the term of each (which would otherwise have expired in July 2000) until
December 31, 2003. The amendments did not change the existing bonus formula for
the executives under which the executive officers are entitled to annual bonuses
based on the amount by which the Company's EBITDA exceeds budgeted amounts. The
amendments did not provide for any additional restricted stock grants. In the
event of a "Change of Control" of the Company (as defined), all restrictions on
restricted shares previously granted as described in the Summary Compensation
Table will immediately lapse. In addition, if any executive's employment is
terminated under certain circumstances (including certain circumstances
following such a Change of Control), the Company is required to pay such
executive a lump sum amount equal to three times his prior year's cash
compensation. The agreements subject the executive officers to standard
non-disclosure and non-compete requirements.
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors administers the
Company's executive compensation program.
The goals of the Company's executive compensation program are to:
- Provide compensation levels that enable the Company to attract, retain
and motivate its executives;
- Tie individual compensation to individual performance and the success
of the Company; and
10
<PAGE> 13
- Align executives' financial interests with those of the Company's
stockholders through equity participation.
Employment Agreements
In December 1999, the Compensation Committee approved the terms of the
amendments to the employment agreements entered into with the Company's three
senior executive officers described above. In each case, the Compensation
Committee decided that it was in the Company's best interest to assure the
Company the continued services of these executives on a long-term basis. In
approving the terms of these agreements, the Compensation Committee considered
not only the Company's compensation goals referred to above, but also levels and
methods of compensation provided by certain companies comparable in size and
lines of business to the Company. Additionally, the Compensation Committee
considered each executive's historical performance, length of tenure, prior
experience and level of responsibility. The Company will not be permitted to
deduct under Section 162(m) of the Internal Revenue Code of 1986 certain
payments to the executives under the employment agreements. Based on his
employment agreement and in recognition of his role in the growth in 1999 of the
Company's EBITDA (as calculated under his employment agreement) from $258.3
million in 1998 to $346.6 million in 1999 (representing an increase of 34.2%),
the Chief Executive Officer received in 1999 a base salary of $754,050 and a
bonus of $3,143,276, as compared to $594,000 in salary, $2,786,076 in bonus and
a restricted stock grant of 340,020 shares with respect to 1998.
Salaries
The base salary of each executive officer who does not have an employment
agreement is reviewed annually based on management recommendations, and data
regarding the salaries of executives with similar responsibilities in certain
companies comparable in size or in lines of business. In addition, the
Compensation Committee considers individual performance, length of tenure, prior
experience and level of responsibility. None of these factors is assigned a
specific weight.
Incentive Compensation
The Company does not have a formal cash incentive compensation program for
executives who do not have employment agreements, but does award annual cash
bonuses to selected employees. Annual bonuses for such executives are
recommended to the Compensation Committee by the Chairman at the end of each
year. Individual bonus awards are based on Company-wide and individual
performance for the previous fiscal year, taking into account both qualitative
and quantitative factors. Quantitative factors include revenues and EBITDA.
Qualitative factors include initiative, business judgment, level of
responsibility and management skills.
Long-Term Incentive
In 1999 the Company's Compensation Committee authorized the granting of
Options to employees to purchase 3,400,000 shares of Common Stock. In
determining the number of Options granted, the Compensation Committee considered
the level of each recipient's responsibility, the recipient's actual and
potential impact on the Company's performance, the recommendations of senior
management, as well as the number of Options granted in prior years. The Company
does not have a target ownership level for equity holdings in the Company by
senior management and other key employees.
Paul A. Biddelman
Michael E. Gellert
11
<PAGE> 14
PERFORMANCE GRAPH
The following table shows a comparison of the five year cumulative total
return to stockholders (assuming all dividends were reinvested) for the Company,
the Standard & Poor's ("S&P") 500 Stock Index and the S&P Entertainment -- 500
Index. During the period October 1990 through June 1994, no trading market
existed for the Common Stock and the Company was unable to obtain any price
quotations for its Common Stock. In June 1994, the Pink Sheets(R) and the OTC
Bulletin Board commenced reporting of bid and asked quotations for the Company's
Common Stock under the symbol PARKD. These quotations reflect inter-dealer
prices, without mark-up, mark-down or commission and do not necessarily
represent actual transactions. From May 30, 1996 until December 19, 1997, the
Common Stock was traded on the Nasdaq National Market under the symbol "PARK."
Since December 22, 1997, the Common Stock has traded on the NYSE under the
symbol "PKS."
[LINE GRAPH]
<TABLE>
<CAPTION>
S&P ENTERTAINMENT -- 500
PREMIER PARKS INC.* S&P 500 INDEX INDEX
------------------- ------------- ------------------------
<S> <C> <C> <C>
1994 100.00 100.00 100.00
1995 233.33 137.58 120.14
1996 666.27 169.17 121.99
1997 839.99 225.60 178.00
1998 1254.80 290.08 241.16
1999 1197.76 351.12 282.18
</TABLE>
<TABLE>
<CAPTION>
BASE
PERIOD RETURN RETURN RETURN RETURN RETURN
COMPANY/INDEX NAME 1994 1995 1996 1997 1998 1999
------------------ ------ ------ ------ ------ -------- --------
<S> <C> <C> <C> <C> <C> <C>
Premier Parks Inc.*........................... 100 233.33 666.27 839.99 1,254.80 1,197.76
S&P 500 Index................................. 100 137.58 169.17 225.60 290.08 351.12
S&P Entertainment -- 500 Index................ 100 120.14 121.99 178.00 241.16 282.18
</TABLE>
- ---------------
* The Common Stock was not publicly traded between October 15, 1990 and June
1994. The return for 1994 was calculated using a beginning point of the
October 15, 1990 price.
12
<PAGE> 15
CERTAIN TRANSACTIONS
On October 31, 1996, the Company acquired substantially all of the assets
used in the operation of Elitch Gardens Amusement Park ("Elitch Gardens"). Sandy
Gurtler, a director of the Company, is the president, a director and a
stockholder of the general partner of the partnership that owned these assets
prior to the transaction. In connection with the acquisition of Elitch Gardens,
the Company entered into a five-year consulting agreement with Mr. Gurtler under
which $100,000 of consulting fees were paid to Mr. Gurtler in 1999.
On December 4, 1996, the Company acquired substantially all of the assets
used in the operation of The Great Escape and Splashwater Kingdom ("The Great
Escape"). Charles R. Wood, a director of the Company, is the sole stockholder of
the entities that owned these assets prior to the transaction. In connection
with the acquisition of The Great Escape, the Company entered into a five-year
consulting agreement with Mr. Wood under which $250,000 of consulting fees were
paid to Mr. Wood in 1999.
The Company's Stock Incentive Plans provide that any recipient of employee
stock options (including executive officers) may exercise options by paying a
portion of the exercise price in cash, with the balance represented by
full-recourse three year promissory notes of such employees in favor of the
Company. The notes, which require equal annual principal payments, bear interest
at rates specified in the Plans (currently 6%) and are secured by a pledge of
the shares of Common Stock acquired upon such exercise. Pursuant to the Plans,
at December 31, 1999 the named executive officers had notes outstanding as
follows: Gary Story, $558,978 and James F. Dannhauser, $222,750.
PROPOSAL 2: APPROVAL OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION TO EFFECT A NAME CHANGE
FROM PREMIER PARKS INC. TO SIX FLAGS, INC.
GENERAL
The Board of Directors has unanimously approved an amendment to Article I
of the Company's certificate of incorporation that would result in a change in
the Company's name to Six Flags, Inc. The proposed amendment would amend Article
I of the Company's certificate of incorporation to read as follows:
"The name of the corporation is Six Flags, Inc. (hereinafter called the
"Corporation")."
The Board of Directors has directed that the proposed amendment be
submitted for stockholder approval.
REASONS FOR THE NAME CHANGE
The Board of Directors has concluded that a change in the Company's name is
desirable in order to use in the Company's name its nationally known brand name,
"Six Flags." The Company acquired the Six Flags brand in 1998 when it acquired
the Six Flags chain of theme parks. Since that time, the Company has rebranded
nine additional parks it owns as "Six Flags" parks and, for the 2000 season,
will own or operate 23 Six Flags parks worldwide. The Board believes that
effecting the name change will permit the Company to be more readily identified
with its brand and the Six Flags parks. The Company believes this closer
identification will, among other benefits, expand its promotional and
sponsorship opportunities. In connection with the name change, the Company does
not anticipate changing its ticker symbol (PKS) on the NYSE.
The change in the Company's name will not affect the validity of currently
outstanding stock certificates. Upon approval of Proposal 2, the Company's
current stockholders will not be required to surrender or
13
<PAGE> 16
exchange any stock certificates that they now hold and they should not send such
certificates to the Company or its transfer agent.
VOTE REQUIRED
The affirmative vote of the holders of a majority of the outstanding shares
of Common Stock is required to approve Proposal 2.
The Board of Directors unanimously recommends adoption and approval of the
proposed amendment to the Company's certificate of incorporation.
PROPOSAL 3: APPROVAL OF AMENDMENT TO PPO'S CERTIFICATE OF
INCORPORATION TO EFFECT A NAME CHANGE FROM PREMIER PARKS
OPERATIONS INC. TO SIX FLAGS OPERATIONS INC.
GENERAL
In March 1998, the company now known as Premier Parks Operations Inc.
(formerly Premier Parks Inc.) reorganized by a merger pursuant to Section 251(g)
of the Delaware General Corporation Law, which allowed the formation of a new
holding company without a vote of the then stockholders of PPO. By virtue of the
reorganization, PPO became a direct, wholly-owned subsidiary of the Company, and
all of PPO's then outstanding capital stock was converted, on a share-for-share
basis, into equivalent capital stock of the Company. By virtue of the merger and
the provisions of such Section 251, matters that under Delaware law require the
approval of PPO's sole stockholder (i.e., the Company) also require the approval
of the Company's stockholders.
The Board of Directors has unanimously approved an amendment to Article I
of PPO's certificate of incorporation that would result in a change in PPO's
name to Six Flags Operations Inc. The proposed amendment would amend Article I
of the PPO's certificate of incorporation to read as follows:
"The name of the corporation is Six Flags Operations Inc. (hereinafter
called the "Corporation")."
The Board of Directors has directed that the proposed amendment be
submitted for stockholder approval.
REASONS FOR THE NAME CHANGE
The Board of Directors is proposing to change the name of PPO for the same
reasons it is proposing a comparable change in the Company's name. See "Proposal
2 -- Reasons for the Name Change."
VOTE REQUIRED
The affirmative vote of the holders of a majority of the outstanding shares
of Common Stock is required to approve Proposal 3.
The Board of Directors unanimously recommends adoption and approval of the
proposed amendment to PPO's certificate of incorporation.
14
<PAGE> 17
PROPOSAL 4: TRANSFER OF OWNERSHIP OF
INTERNATIONAL OPERATIONS TO SFTP
During 1999, the Company commenced a reorganization of its corporate
structure designed to significantly simplify its capital structure, reduce
administrative expenses and increase operational flexibility and efficiency. The
reorganization included the merger of Six Flags Entertainment Company, a
wholly-owned subsidiary of the Company, into PPO and the transfer by PPO of its
ownership of the capital stock of its subsidiaries that own or operate thirteen
U.S. parks to SFTP, a direct wholly-owned subsidiary of PPO. This transfer
resulted in all of the Company's interest in its U.S. parks (other than Six
Flags Over Georgia and Six Flags Over Texas, which are owned by partnerships
with third party limited partners) being owned directly or indirectly by a
common parent, SFTP. In connection with this reorganization, the Company
replaced its two then-existing credit facilities (with PPO and SFTP as the
respective borrowers) with a single $1.2 billion facility with SFTP as the
principal borrower, resulting in a further simplification of the Company's
capitalization. At the time of reorganization and refinancing, the Company's
Delaware counsel advised it that a transfer by PPO to SFTP of the capital stock
owned by PPO's in two wholly-owned subsidiaries of the Company, Premier
International Holdings Inc. and Premier Parks Holdings Inc., the entities that
indirectly own the Company's eight parks located in Europe and Mexico, when
coupled with PPO's concurrent transfer of its interests in the thirteen domestic
parks, would require the approval of PPO's stockholders.
As noted in Proposal 3 above, any matter that requires approval of the
Company as PPO's sole stockholder also requires approval of the Company's
stockholders. For that reason, the transfer of PPO's international operations
was not effected at the time of the domestic reorganization, and the Company
agreed with its institutional lenders to submit the transfer of the
international operations for stockholders' approval at the Annual Meeting.
If Proposal 4 is adopted, PPO will transfer to SFTP all of the capital
stock owned by PPO of Premier International Holdings Inc. and Premier Parks
Holdings Inc., further simplifying the Company's capital structure.
The affirmative vote of the holders of a majority of the outstanding shares
of Common Stock is required to approve Proposal 4.
The Board of Directors unanimously recommends adoption and approval of
Proposal 4.
PROPOSAL 5: RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
KPMG LLP ("KPMG"), certified public accountants, audited the Company's
consolidated financial statements for the fiscal year ended December 31, 1999.
The Board of Directors has appointed KPMG to audit the Company's consolidated
financial statements for the fiscal year ending December 31, 2000, and
recommends that the stockholders vote for ratification of such appointment. The
ratification requires the affirmative vote of a majority of the shares of Common
Stock represented at the Annual Meeting. In the event the ratification is not
approved, the Board of Directors will reconsider its selection. Representatives
of KPMG are expected to attend the Annual Meeting and will be available to
respond to appropriate questions from stockholders present at such meeting.
2001 STOCKHOLDER PROPOSALS
- In order for a stockholder proposal to be considered for inclusion in the
Company's proxy statement for the 2001 Annual Meeting, the proposal must
be received at the Company's offices no later than
15
<PAGE> 18
December 26, 2000. Rule 14a-8 of the SEC contains standards as to what
stockholder proposals are required to be included in a proxy statement.
- If a stockholder intends to present a proposal for consideration at the
2001 Annual Meeting outside the processes of SEC Rule 14a-8, the Company
must receive notice of such proposal on or before March 12, 2001.
Otherwise the proposal will be considered untimely under SEC rules and
the Company's proxies will have discretionary voting authority with
respect to such proposal, if presented at the meeting, without including
information regarding the proposal in its proxy materials.
Any stockholder who wishes to submit a stockholder proposal, should send it
to the Secretary of the Company at 11501 Northeast Expressway, Oklahoma City,
Oklahoma 73131 (Attn: Secretary), prior to December 26, 2000.
OTHER MATTERS
The Board of Directors does not know of any other matters that are likely
to be presented for consideration at the Annual Meeting. Should any other
matters properly come before the Annual Meeting or any adjournments thereof, it
is the intention of the persons named in the accompanying proxy to vote such
proxy in accordance with their best judgment.
SOLICITATION OF PROXIES
All costs in connection with the solicitation of the enclosed proxy will be
borne by the Company. In addition to solicitations of proxies by use of the
mail, certain officers or employees of the Company, without additional
remuneration, may solicit proxies personally or by telephone, facsimile and
mail. The Company has retained D.F. King & Co., Inc. to solicit proxies for a
fixed fee of $4,500. In addition, the Company will also request brokers,
dealers, banks and other nominees to solicit proxies from their clients, where
appropriate, and will reimburse them for reasonable expenses related thereto.
RICHARD A. KIPF
Secretary
Oklahoma City, Oklahoma
April 25, 2000
16
<PAGE> 19
INTENTIONALLY LEFT BLANK.
<PAGE> 20
EXHIBIT A
CHARTER OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
I. AUDIT COMMITTEE PURPOSE
The Audit Committee is appointed by the Board of Directors to assist the
Board in fulfilling certain of its oversight responsibilities. The Audit
Committee's primary duties and responsibilities are to:
- Monitor the integrity of the Company's financial reporting process and
related systems of internal controls.
- Monitor the independence and performance of the Company's independent
auditors and internal auditing department.
- Provide an avenue of communication among the independent auditors,
management, and the Board of Directors.
- Monitor the Company's safety programs as described below.
The Audit Committee has the authority to conduct any investigation
appropriate to fulfilling its responsibilities, and it has direct access to the
independent auditors as well as anyone else in the organization. The Audit
Committee has the ability to retain, at the Company's expense, special legal,
accounting, or other consultants or experts it deems necessary or appropriate in
the performance of its duties.
II. AUDIT COMMITTEE COMPOSITION AND MEETINGS
Audit Committee members shall meet the requirements of the New York Stock
Exchange. Subject to the preceding sentence, the Audit Committee shall be
comprised of such number of directors as determined from time to time by the
Board. The members shall be elected by the Board and each shall be an
independent nonexecutive director, free from any relationship that would
interfere with the exercise of his or her independent judgment. All members of
the Committee shall have a basic understanding of finance and accounting and be
able to read and understand fundamental financial statements, and at least one
member of the committee shall have accounting or related financial management
expertise.
The audit committee Chair will be selected by the members thereof. If the
audit committee Chair is not present at a meeting, the members of the Committee
may designate a Chair for the meeting by majority vote of the Committee members
present. A quorum of the Committee shall be a majority of the members thereof.
The Committee shall meet at least four times annually, or more frequently
as circumstances dictate. The Committee shall meet privately in separate
executive session at least annually with management and with the independent
auditors. In addition, the Committee, or at least its Chair, should communicate
with management and the independent auditors quarterly to review the Company's
financial statements and significant findings based upon the auditors limited
review procedures.
III. RESPONSIBILITIES AND DUTIES -- FINANCIAL MATTERS
The Committee's role is to oversee the Company's financial reporting
process; the Company's management is responsible for preparing the Company's
financial statements and the independent auditors are responsible for auditing
those financial statements. Additionally, it is recognized that the Company's
financial management, as well as the independent auditors, have more time,
knowledge and detailed information about
A-1
<PAGE> 21
the Company than do Committee members. Consequently, in carrying out its
oversight responsibilities, the Committee is not providing any expert or special
assurance as to the Company's financial statements or any professional
certification as to the independent auditors' work.
The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function. These functions are set forth
as a guide with the understanding that the Committee may diverge from this guide
as appropriate given the circumstances.
Review Procedures
1. Review and reassess the adequacy of this Charter at least annually.
Submit the charter to the Board of Directors for approval and have the Charter
published at least every three years in accordance with the regulations of the
Securities and Exchange Commission ("SEC").
2. Review the Company's annual audited financial statements to be included
in the Company's Form 10-K and Annual Report to Stockholders prior to filing or
distribution. Review should include discussion with management and the
independent auditors of significant issues regarding accounting principles,
practices, and judgments required to be communicated by independent auditors in
accordance with SAS 61.
3. In consultation with the management and the independent auditors,
consider the integrity of the Company's financial reporting processes and
controls. Discuss significant financial risk exposures and the steps management
has taken to monitor, control, and report on such exposures. Review any
significant findings prepared by the independent auditors together with
management's responses.
4. Discuss with financial management and the independent auditors the
Company's quarterly financial statements prior to filing or distribution.
Discuss any significant changes to the Company's accounting principles and any
items required to be communicated by the independent auditors in accordance with
SAS 61 (see item 5). The Chair of the Committee may represent the entire Audit
Committee for purposes of this review.
Independent Auditors
5. The independent auditors are ultimately accountable to the Audit
Committee and the Board of Directors. The Audit Committee shall review the
performance and independence of the independent auditors. Consistent with this
role, the Committee shall:
- Request from the outside auditors annually, a formal written statement
delineating all relationships between the auditors and the Company
consistent with Independence Standards Board Standard Number 1;
- Discuss with the outside auditors any such disclosed relationships and
their impact on the outside auditors' independence;
- Recommend that the Board take appropriate action in response to the
outside auditors' report to satisfy itself of the auditors' independence;
- Recommend to the Board annually the retention of independent auditors for
the Company and recommend any termination of the retention of the
independent auditors that the Committee considers appropriate;
- Approve the fees and other significant compensation to be paid to the
independent auditors;
A-2
<PAGE> 22
- Review the independent auditors audit plan -- discuss scope, staffing,
locations, reliance upon management, and general audit approach; and
- Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in its
financial reporting.
Other
6. On at least an annual basis, review with the Company's General Counsel,
any legal matters that could have a significant impact on the Company's
financial statements, the Company's compliance with applicable laws and
regulations, and inquiries received from regulators or governmental agencies.
7. Annually prepare a report to the Company's stockholders as required by
the SEC. The report should be included in the Company's annual proxy statement.
8. Perform any other activities consistent with this Charter, the Company's
by-laws, and governing law, as the Committee or the Board deems necessary or
appropriate.
9. Maintain minutes of meetings and periodically report to the Board of
Directors on significant results of the foregoing activities.
IV. RESPONSIBILITIES AND DUTIES -- SAFETY MATTERS
The Committee shall have the additional role of specified oversight of the
Company's safety policies and procedures as reflected in the Company's Safety
Manual (the "Safety Procedures"); the Company's management is responsible for
developing and implementing the Company's Safety Procedures and their adequacy.
Additionally, it is recognized that the Company does employ and retain
individuals with expertise and experience in the safe operation of the Company's
amusement facilities and that these individuals, and not the Committee members,
have the time, knowledge and information necessary to assess the adequacy of the
Company's Safety Procedures for assuring adherence to those policies.
Consequently, in carrying out its oversight responsibilities the Committee is
not providing any expert or special assurance as to safety matters.
The following functions shall be the common recurring activities of the
Committee in carrying out its safety oversight function. These functions are set
forth as a guide with understanding that the Committee may diverge from this
guide as appropriate given the circumstances.
The Committee's duties and responsibilities will include:
1. Review, on an annual basis, a report addressed to the Committee
from the person designated by management as the executive in charge of
safety matters (the "Safety Manager") concerning the appropriateness of the
Company's existing Safety Procedures, their implementation and any
proposals of the Safety Manager or management concerning changes therein.
2. Review, on an annual basis, a report from the Company's General
Counsel regarding the appropriateness of the Safety Procedures under
existing law and including a discussion of new legislation and legal
trends.
3. The Chair or such other member or members designated by the
Committee will act as special liaison between the Committee and the Safety
Manager and will be available to discuss with the Safety Manager, either by
phone or in person, any safety issues that the Safety Manager believes
require Committee attention prior to the next scheduled Committee meeting.
Without limiting the generality of the foregoing, in the event of any
material dispute between the Safety Manager and senior management
A-3
<PAGE> 23
of the Company with regard to safety matters, the Safety Manager shall
bring such situation to the attention of the Chair or such designated
member or members of the Committee.
4. In the event of any vacancy in the position of Safety Manager, the
Committee (or designated members thereof) will meet with any person whom
management proposes to be selected as the successor Safety Manager prior to
the effectiveness of such selection. In that case the Committee will make a
recommendation to management regarding such selection.
5. The Committee shall instruct management to develop procedures so
that any park-level Safety Manager is able to report directly to the
Company's Safety Manager any safety concerns relating to such park.
6. Periodically report to the Board of Directors on significant
results of the foregoing activities.
A-4
<PAGE> 24
PRELIMINARY COPIES
DATED APRIL 7, 2000
PROXY
PREMIER PARKS INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints KIERAN E. BURKE, JAMES F. DANNHAUSER, GARY
STORY, JAMES M. COUGHLIN and RICHARD A. KIPF with full power to act without the
others and with power to appoint his substitute as the undersigned's proxies to
vote all shares of Common Stock of the undersigned in PREMIER PARKS INC. (the
"Company"), a Delaware corporation, which the undersigned would be entitled to
vote at the Annual Meeting of Stockholders of the Company to be held at the
Hotel Intercontinental, 111 East 48th Street, New York, New York 10017, on
Thursday, June 15, 2000, at 10:00 a.m., E.D.T., and at any and all adjournments
thereof as follows:
1. ELECTION OF DIRECTORS
[ ] FOR all nominees listed below (except as marked to
the contrary below) [ ] Exceptions*
[ ] WITHHOLD AUTHORITY to vote for all nominees listed
below
PAUL A. BIDDELMAN, KIERAN E. BURKE, JAMES F. DANNHAUSER, MICHAEL E. GELLERT,
FRANCOIS LETACONNOUX, STANLEY S. SHUMAN, GARY STORY
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.)
* Exceptions:
- ---------------------------------------------
- --------------------------------------------------------------------------------
2. Proposal to approve an amendment to the Company's Certificate of
Incorporation to change the name of the Company to "Six Flags, Inc." The
Board of Directors unanimously recommends a vote FOR this proposal.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to approve an amendment to the Certificate of Incorporation of the
Company's principal direct subsidiary, Premier Parks Operations Inc. ("PPO"),
to change the name of PPO to "Six Flags Operations Inc." The Board of
Directors unanimously recommends a vote FOR this proposal.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. Proposal to approve the transfer by PPO to its wholly-owned subsidiary, Six
Flags Theme Parks Inc., of all of the capital stock owned by PPO of the
Company's subsidiaries that indirectly own the Company's international parks.
The Board of Directors unanimously recommends a vote FOR this proposal.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. Proposal to ratify the selection of KPMG LLP as the Company's independent
public accountants for the year ending December 31, 2000. The Board of
Directors unanimously recommends a vote FOR this proposal.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. In their discretion such other business as may properly come before the
meeting and any and all adjournments thereof.
The shares of Common Stock represented by this proxy will be voted in
accordance with the foregoing instructions. In the absence of any instructions,
such shares will be voted for the election of the nominees listed in item 1 and
for the proposals in items 2-5.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
of Stockholders to be held on June 15, 2000 and the Proxy Statement furnished
therewith.
The undersigned hereby revokes any proxy to vote shares of Common Stock of
the Company heretofore given by the undersigned.
-----------------------------------
(Date)
Signature
-----------------------------------
Please date, sign exactly as name
appears on this proxy, and promptly
return in the enclosed envelope.
When signing as guardian, executor,
administrator, attorney, trustee,
custodian, or in any other similar
capacity, please give full title.
If a corporation, sign in full
corporate name by president or
other authorized officer, giving
title, and affix corporate seal. If
a partnership, sign in partnership
name by authorized person. In the
case of joint ownership, each joint
owner must sign.
