SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss. 240.14a-11(C) or ss. 240.14a-12
American Physicians Service Group, Inc.
(Name of Registrant as Specified In Its Charter)
American Physicians Service Group, Inc.
(Name of Persons(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
|X| $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(I)(1), or 14a-6(I)(2).
|_| $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(I)(3).
|_| 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 0-11:1
4) Proposed maximum aggregate value of transaction:
1 Set forth the amount on which the filing fee is calculated and
state how it was determined.
|_| Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
LOGO HERE
1301 Capital of Texas Highway
Austin, Texas 78746
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held June 13, 1996
Notice is hereby given that the Annual Meeting of Shareholders of
American Physicians Service Group, Inc., a Texas corporation (the "Company"),
will be held at The Barton Creek Conference Center located at 8212 Barton Club
Drive, Austin, Texas 78735, on Thursday, June 13, 1996 at 8:00 a.m., Austin,
Texas time, for the following purposes:
(a) To elect six directors to serve on the Board of Directors;
(b) To authorize the adoption of the 1995 Non-Employee Director
Stock Option Plan,as described in the accompanying Proxy
statements;
(c) To authorize the adoption of the 1995 Incentive and
Non-Qualified Stock Option Plan; and
(d) To transact such other business as may properly come before
the meeting or any adjournment(s) thereof.
The accompanying Proxy Statement contains information regarding, and a
more complete description of, the items of business to be considered at the
meeting.
Only shareholders of record at the close of business on April 26, 1996,
are entitled to notice of, and to vote at, the Annual Meeting of Shareholders or
any adjournment(s) thereof.
You are cordially invited and urged to attend the meeting, but if you
are unable to attend the meeting, you are requested to sign and date the
accompanying proxy and return it promptly in the enclosed self-addressed
envelope. If you attend the meeting, you may vote in person, if you wish,
whether or not you have returned your proxy. In any event, a proxy may be
revoked at any time before it is exercised.
By Order of the Board of Directors
W. H. HAYES, VP and Secretary
Austin, Texas
May 2, 1996
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
1301 Capital of Texas Highway
Austin, Texas 78746
PROXY STATEMENT
for
ANNUAL MEETING OF SHAREHOLDERS
To Be Held June 13, 1996
This Proxy Statement is sent to shareholders of American Physicians
Service Group, Inc., a Texas corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors of the Company for use at the
Annual Meeting of Shareholders of the Company to be held at The Barton Creek
Conference Center located at 8212 Barton Club Drive, Austin, Texas 78735, on
Thursday, June 13, 1996 at 8:00 a.m., Austin, Texas time, and any adjournment(s)
thereof, for the purposes set forth in the accompanying Notice of Annual Meeting
of Shareholders. Solicitation of proxies may be made in person or by mail,
telephone, or telecopy by directors, officers, and regular employees of the
Company. The Company may also engage the service of others to solicit proxies in
person or by telephone or telecopy. In addition, the Company may also request
banking institutions, brokerage firms, custodians, nominees, and fiduciaries to
forward solicitation material to the beneficial owners of common stock of the
Company held of record by such persons, and the Company will reimburse the
forwarding expenses. The cost of solicitation of proxies will be paid by the
Company. This Proxy Statement and the enclosed form of proxy were first mailed
to shareholders on or about May 2, 1996.
ANNUAL REPORT
Enclosed is an Annual Report to Shareholders for the year ended
December 31, 1995, including audited financial statements. Such Annual Report to
Shareholders does not form any part of the material for the solicitation of
proxies.
REVOCATION OF PROXY
Any shareholder returning the accompanying proxy may revoke such proxy
at any time prior to its exercise (a) by giving written notice to the Secretary
of the Company of such revocation, (b) by voting in person at the meeting, or
(c) by executing and delivering to the Secretary of the Company a later dated
proxy.
OUTSTANDING COMMON STOCK; CERTAIN SHAREHOLDERS
The voting securities of the Company are shares of its common stock,
$.10 par value (the "Common Stock"), each share of which entitles the holder
thereof to one vote on each matter properly brought before the meeting. Only
shareholders of record at the close of business on April 26, 1996 are entitled
to notice of, and to vote at, the Annual Meeting of Shareholders and any
adjournment(s) thereof. At April 26, 1996, the Company had outstanding and
entitled to vote 4,002,204 shares of Common Stock.
1
<PAGE>
The following table sets forth certain information as of April 26, 1996
regarding the amount and nature of the beneficial ownership of Common Stock by
(a) each person who is known by the Company to be the beneficial owner of more
than five percent of the outstanding shares of Common Stock, (b) each director
and nominee for director of the Company, (c) each executive officer of the
Company named in the Summary Compensation Table below, and (d) all officers and
directors of the Company as a group:
<TABLE>
<CAPTION>
Amount and Nature Percent
Name and Address of of Beneficial of
Beneficial Owner Ownership(1)(2) Class
-------------- -----
<S> <C> <C>
Kenneth S. Shifrin................ 384,858 9.3
1301 Capital of Texas Highway
Austin, Texas 78746
Duane K. Boyd......................... 120,000 3.0
Jack R. Chandler, M.D................. 100,093 2.5
Richard J. Clark...................... 111,696 2.8
Samuel R. Granett..................... 13,301 .3
W. H. Hayes........................... 59,999 1.5
Jack Murphy........................... 55,000 1.4
Robert L. Myer........................ -- .0
William A. Searles..................... 31,000 .8
Roger T. Scaggs........................ 8,333 .2
All officers and directors as
a group (11 persons)(2)(3)............ 884,280 20.5
- --------------
<FN>
(1) Except as otherwise indicated, each individual has sole voting and
investment power with respect to all shares owned by such individual.
(2) The number of shares beneficially owned by officers and directors
includes the following number of shares subject to options that are presently
exercisable or exercisable within 60 days after April 26, 1996: Mr. Shifrin,
133,333; Dr. Chandler, 33,333; Mr. Clark, 33,333; Mr. Hayes, 34,999; Mr. Murphy,
30,000; Mr. Searles, 30,000; and Mr. Scaggs, 8,333. The number of shares
beneficially owned by all directors and officers as a group, including the
above-named directors, includes 303,331 shares subject to options that are
presently exercisable or exercisable within 60 days after April 26, 1996.
(3) Includes the president and chairman of the board, if any, of
each of the Company's subsidiaries.
</FN>
</TABLE>
2
<PAGE>
EXECUTIVE COMPENSATION
<TABLE>
Summary Compensation Table
Set forth below is information concerning aggregate cash compensation paid
during each of the Company's last three fiscal years to the Company's Chief
Executive Officer and each of the Company's other most highly compensated
executive officers who received in excess of $100,000 in salary and bonuses
during 1995.
<CAPTION>
Summary Compensation Table
Annual Compensation Long Term Compensation
-------------------------------------- -------------------
Awards
-------------------
Other Annual Securities All Other
Compensation Underlying Compensation
Name and Principal Position Fiscal Year Salary($) Bonus($)(1) ($)(2) Options(#) ($)(3)
- ----------------------------- -------------- ----------- ----------- ----------- ------------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Kenneth S. Shifrin, CEO 1995 112,500 44,800 -- 25,000 3,154
1994 112,500 41,700 -- -- 3,049
1993 112,500 35,000 -- -- 2,950
Samuel R. Granett, Senior VP 1995 -- -- 491,571 7,500 3,154
1994 -- 35,746 372,088 -- 3,080
1993 18,350 -- 764,950 -- 2,968
Duane K. Boyd, Senior VP 1995 150,000 121,000 -- -- 3,154
1994 150,000 57,000 -- -- 3,080
1993 150,000 90,000 -- -- 2,968
Roger T. Scaggs, Senior VP 1995 105,333 46,200 -- -- 2,970
1994 96,000 45,317 -- 25,000 2,970
1993 93,855 10,000 -- -- 2,772
William H. Hayes, VP 1995 87,620 19,300 -- 25,000 3,154
1994 83,160 17,900 -- 25,000 3,042
1993 80,850 15,000 -- 20,000 2,950
<FN>
- ---------------------------
(1) Reflects bonus paid during the fiscal year.
(2) Consists of commissions earned.
(3) Consists of Company contributions to the Company's 401(k) plan.
</FN>
</TABLE>
3
<PAGE>
<TABLE>
Options Granted During Last Fiscal Year
The following table provides information related to options granted to the
named executive officers during 1995. The Company does not have any outstanding
stock appreciation rights.
Option Grants in Last Fiscal Year
Individual Grants
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Number of securities
underlying Options Percent of total options granted to
Name granted (#) employees in fiscal year Exercise price ($/Sh) Expiration date
- ----------------- ------------------- ------------------------------- --------------------- ----------------
<S> <C> <C> <C> <C>
Kenneth S. 25,000 20% $3.25 06/15/00
Shifrin, CEO
Samuel R.
Granett, Senior 5,000 4% $3.50 08/31/00
VP 2,500 2% $9.63 12/31/00
Duane K. Boyd,
Jr., Senior VP -- -- -- --
Roger T.
Scaggs, Senior -- -- -- --
VP
William H. 25,000 20% $3.25 06/15/00
Hayes, VP
</TABLE>
Option Exercises During 1995 and Option Values at December 31, 1995
The following table provides information related to options exercised by
the named executive officers during 1995 and the number and value of options
held at December 31, 1995. The Company does not have any outstanding stock
appreciation rights.
4
<PAGE>
<TABLE>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
---------------------------------
<CAPTION>
Number of Securities Underlying
Unexercised Options at Fiscal Value of Unexercised In-the-Money
Year End Options at Fiscal Year End
--------------------------- ---------------------------
Shares Acquired Value Exercisable Unexercisable
Name on Exercise(#) Realized($) Exercisable(#) Unexercisable(#) ($) ($)
- ---------------------------- ------------ ------------ ------------- ------------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Kenneth S. Shifrin, CEO -- -- 225,000 25,000 1,856,250 159,375
Samuel R. Granett, Senior VP -- -- -- 7,500 -- 30,625
Duane K. Boyd, Senior VP 40,000 62,500 160,000 -- 1,262,400 --
Roger T. Scaggs, Senior VP -- -- 58,333 16,667 455,956 122,919
William H. Hayes, VP 21,000 40,688 26,666 48,334 192,570 328,130
- ---------------------------
<FN>
(1) The Value of Unexercised In-the-Money Options is before any income
taxes and was calculated by subtracting the per share exercise
price of the option from the closing price for the Company's
Common Stock on December 31, 1995 ($9.625) and multiplying the
difference times the number of shares of Common Stock underlying
the option.
</FN>
</TABLE>
Compensation of Directors
- -------------------------
Messrs. Murphy and Searles receive a fee of $1,000 for each meeting of the
Board of Directors that they attend. Messrs. Clark, Chandler and Shifrin do
not receive separate compensation for their services as directors.
CERTAIN TRANSACTIONS
Until October 1994, the Company retained Mr. Richard J. Clark, a director
of the Company, to provide consulting services to the Company as an independent
contractor. During the year ended December 31, 1994, Mr. Clark was paid
approximately $63,000 for such services. Mr. Clark was employed by the Company
in October 1994, terminating the consulting agreement.
SECTION 16 FILING REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and officers, and persons who own more than 10% of a
registered class of the Company's equity securities, to file initial reports of
ownership and reports of changes in ownership with the Securities and Exchange
Commission (the "SEC") and the NASDAQ Stock Exchange. Such persons are required
by SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
5
<PAGE>
Based solely on review of the copies of such forms received by the Company
with respect to 1995, or written representations from certain reporting persons,
the Company believes that all filing requirements applicable to its directors
and officers and persons who own more than 10% of a registered class of the
Company's equity securities have been complied with, except that during 1995 one
report on Form 4 was filed late by each of Richard J. Clark and William A.
Searles. Mr. Clark and Mr. Searles are directors of the Company.
QUORUM; VOTING
The presence, in person or by proxy, of the holders of a majority of the
outstanding shares of Common Stock entitled to vote is necessary to constitute a
quorum at the meeting. If a quorum is not present or represented at the meeting,
the shareholders entitled to vote thereat, present in person or represented by
proxy, have the power to adjourn the meeting from time to time, without notice
other than an announcement at the meeting, until a quorum is present or
represented. At any such adjourned meeting at which a quorum is present or
represented, any business may be transacted that might have been transacted at
the meeting as originally notified.
Cumulative voting is not permitted in the election of directors of the
Company. On all matters (including election of directors) submitted to a vote of
the shareholders at the meeting or any adjournment(s) thereof, each holder of
Common Stock will be entitled to one vote for each share of Common Stock owned
of record by such shareholder at the close of business on April 26, 1996.
SHAREHOLDER PROPOSALS
Any shareholder of the Company meeting certain minimum stock ownership and
holding period requirements may present a proposal for action at the annual
meeting of shareholders to be held in 1997. Such shareholder must deliver the
proposal to the executive offices of the Company no later than January 15, 1997,
unless the Company notifies the shareholders otherwise. Only those proposals
that are proper for shareholder action and otherwise proper may be included in
the Company's proxy statement. The Nominating Committee of the Board of
Directors will consider nominations for directors of the Company to be elected
at the Annual Meeting of Shareholders to be held in 1997 that are submitted in
writing by any shareholder of the Company prior to January 15, 1997.
Notwithstanding the foregoing, all shareholder proposals must be made in
compliance with the applicable provisions of the Bylaws of the Company.
ACTION TO BE TAKEN UNDER THE PROXY
Proxies in the accompanying form which are properly executed and returned
will be voted at the meeting and any adjournment(s) thereof and will be voted in
accordance with the instructions thereon. Any proxy upon which no instructions
have been indicated with respect to a specified matter will be voted as follows
with respect to such matters: (a) "FOR" the six persons named in this Proxy
Statement as the Board of Directors' nominees for election to the Board of
Directors, (b) "FOR" the adoption of the Company's 1995 Non-Employee Director
6
<PAGE>
Stock Option Plan, (c) "FOR" the adoption of the Company's 1995 Incentive and
Non-Qualified Stlck Option Plan, and (d) in the transaction of such other
business as may properly come before the meeting or any adjournment(s) thereof.
The Board of Directors knows of no matters, other than those stated above, to be
presented for consideration at the meeting. If, however, other matters properly
come before the meeting or any adjournment(s) thereof, it is the intention of
the persons named in the accompanying proxy to vote such proxy in accordance
with their judgment on any such matters. The persons named in the accompanying
proxy may also, if it is deemed to be advisable, vote such proxy to adjourn the
meeting from time to time.
ELECTION OF DIRECTORS
Pursuant to the Company's Bylaws, the Board of Directors has, by
resolution, fixed the number of directors at six, and six directors will be
elected. All nominees will be elected to hold office until the next annual
meeting of shareholders of the Company and until his successor is elected and
qualified. Each nominee is presently a director of the Company and, with the
exception of Mr. Clark, has served continuously since first becoming a director.
Mr. Clark has been a director since January 1990, and had previously served in
that capacity from 1978 to 1986.
The Board of Directors held seven meetings during the year ended December 31,
1995, and each director attended at least 75% of the aggregate of (a) the total
number of meetings of the Board of Directors held during the period for which he
served as a director and (b) the total number of meetings held by all committees
of the board on which he served.
Director of
Name Age Company Since
Jack R. Chandler, M.D. 71 1983
Richard J. Clark 62 1990
Jack Murphy 67 1974
Robert L. Myer 47 1996 Nominee
William A. Searles 53 1989
Kenneth S. Shifrin 47 1987
Mr. Shifrin has been Chairman of the Board since March 1990. He has been
President and Chief Executive Officer since March 1989 and was President and
Chief Operating Officer from June 1987 to February 1989. He has been a Director
of the Company since February 1987. From February 1985 until June 1987,
Mr. Shifrin served as Senior Vice President - Finance and Treasurer. He has
been Chairman of the Board of Prime Medical Services, Inc. since October
1989. Mr. Shifrin is a member of the Young Presidents' Organization.
Dr. Chandler, a founder of the Company, has been a Director of the Company
since July 1983 and has served as Vice Chairman of the Board since February
1985. Dr. Chandler was Vice Chairman of American Physicians Insurance Exchange
from August 1975 to April 1978 and was
7
<PAGE>
Chairman of its Board of Directors from April 1978 to April 1985. Dr. Chandler
was a physician in private practice in San Antonio, Texas from 1956 until his
retirement in 1985. Dr. Chandler serves as a Director of Prime Medical
Services, Inc.
Mr. Clark has been a Director of the Company since January, 1990 and had
previously served in that capacity from 1978 to 1986. Mr. Clark was Secretary of
the Company from January 1977 to July 1983. He was an officer of several
insurance-related subsidiaries of the Company from 1977 to 1986 and was a
consultant to the Company in that area from 1986 through September 1994. In
October 1994, Mr. Clark again became an employee of the Company. Mr. Clark has
over 30 years experience in the insurance industry.
Mr. Murphy, a founder of the Company, was Chairman of the Board from
February 1989 to March 1990 and previously held that position from October 1974
to December 1987. He has been a Director of the Company since October 1974 and
was President from October 1974 to January 1986.
Mr. Myer is currently President and Chief Executive Officer of College
Insurance Group, Inc., an insurance holding company which owns 100% of Annuity
Service Corp. and Financial Assurance Life Insurance Company. Annuity Service
Corp. manages and administers qualified plan annuity and life insurance business
for several insurance companies. Financial Assurance Life is a provider of
annuity and life products. Mr. Myer had previously founded and was President
and Chief Executive Officer of the NAP Group of Companies. The NAP Group of
Companies marketed and administered tax-deferred annuity and life insurance
programs.
Mr. Searles has been a director since July 1989. He is an independent
business consultant and from 1981 to 1989 was associated with Bear, Stearns &
Co., Inc. (an investment banking firm), most recently as an Associate Director/
Limited Partner. He currently serves as a Director of two other public
companies: Diversified Communications Industries, Ltd. and Prime Medical
Services, Inc.
Should any nominee named herein for the office of director become
unwilling or unable to accept nomination of election, it is intended that the
persons acting under the proxy will vote for the election, in his stead, of such
other persons as the Board of Directors of the Company may recommend or the
Board of Directors of the Company may reduce the number of directors to be
elected. The Board of Directors has no reason to believe that any nominee named
above will be unwilling or unable to serve.
The Board recommends a vote FOR each nominee for director.
8
<PAGE>
CERTAIN INFORMATION CONCERNING THE BOARD OF DIRECTORS
No family relationships exist among the officers or directors of the
Company. Except as indicated above, no director of the Company is a director of
any company with a class of securities registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or subject to
the requirements of Section 15(d) of the Exchange Act or any company registered
as an investment company under the Investment Company Act of 1940.
The Board of Directors has a standing audit committee which, during 1995,
consisted of two directors, Mr. Murphy and Mr. Searles. The audit committee held
three meetings during the year ended December 31, 1995, at which both members
were present. The audit committee meets with the Company's independent auditors,
reviews the financial statements of the Company, and recommends to the Board of
Directors of the Company the selection of the Company's independent auditors for
each fiscal year. The Board has a standing compensation committee which, in
1995, consisted of two directors, Mr. Murphy and Mr. Searles. The compensation
committee held two meetings during the year ended December 31, 1995. The
compensation committee has primary responsibility for determining executive
compensation. The Board also has a standing option committee which consisted of
two directors, Mr. Murphy and Mr. Searles. The option committee held two
meetings during the year ended December 31, 1995. The option committee has
primary responsibility for recommending option grants to key employees and to
directors who are not on the option committee.
The Board of Directors has an executive committee currently consisting of
Mr. Murphy and Mr. Shifrin. The executive committee held no meetings during the
year ended December 31, 1994. The executive committee has the authority to take
all actions that the Board of Directors of the Company has, except in limited
circumstances as described in the Bylaws of the Company and the Texas Business
Corporation Act.
PROPOSAL TO APPROVE THE 1995 NON-EMPLOYEE
DIRECTOR STOCK OPTION PLAN
On June 15, 1995, the Company's Board of Directors adopted, subject to
shareholder approval, the 1995 Non-Employee Director Stock Option Plan (the
"Director Plan"). The purpose of the Director Plan is to attract and retain the
services of the Company's experienced and knowledgeable outside directors and to
provide additional incentive for such persons to continue to work for the best
interests of the Company and its shareholders. The Director Plan provides for
the issuance of options to purchase up to an aggregate of 200,000 shares of the
Company's Common Stock to the eligible outside directors (as described below).
Approval of the Director Plan requires the affirmative vote of a majority of the
votes cast, in person or by proxy, at the Annual Meeting.
9
<PAGE>
The Board recommends a vote FOR approval of the 1995 Non-Employee Director
Stock Option Plan.
The following is a brief summary of the proposed Director Plan. The
complete text, is attached as Appendix A to this Proxy Statement and reference
is made to such Appendix for a complete statement of the provisions of the
Director Plan.
The Director Plan provides that on the date on which a non-employee
Director is appointed as a member of the Option Committee he or she shall
automatically be granted an option to purchase 30,000 shares of Common Stock on
that day and on each anniversary of his/her appointment to the Option Committee.
Each non-employee Director who is also a member of the Option Committee on the
date of the Company's 1995 Annual Meeting will be deemed to have been first
elected on such date. Option grants shall only be made to those directors who
(i) are not otherwise employees of the Company or any subsidiary on the date of
grant; (ii) were not employees of the Company, or any subsidiary at any time
during the period commencing on the date of the last annual meeting through the
date of grant (the "Eligibility Period"); and (iii) were members of the Option
Committee.
NEW PLAN BENEFITS
1995 Non-Employee Director Plan
Name and Position Dollar Value (1) Number of Units
Non-Employee N/A 60,000 (2)
Director Group
(1) All options under the Director Plan will be granted at Fair Market Value.
Accordingly, the dollar value benefit is based upon future appreciation in
the Company's Common Stock and therefore is not presently determinable.
(2) Represents options granted during the fiscal year 1995. In addition, each
non-employee Director shall automatically be granted options to purchase
an additional 30,000 shares on each anniversary of his/her appointment to
the Option Committee; provided that such option grants shall only be made
to those directors who (i) are not employees of the Company or any
subsidiary at any time during the Eligibility Period and (ii) were members
of the Option Committee on the grant date.
10
<PAGE>
Options under the Director Plan will be automatically granted to each
eligible director as set forth above. The exercise price of the options will be
the fair market value (as determined under the plan) of the underlying shares on
the date of grant. The options shall vest and become exercisable as determined
by the Board of Directors. All options under the Director Plan expire ten years
from the date of grant. The number of shares subject to the plan or any option
and the exercise price of such options are to be adjusted for any merger,
consolidation, stock dividend or similar transaction.
For outside directors receiving grants under the Director Plan, options
may be exercised within 90 days after such persons cease to serve as a director
of the Company. The options shall be exercisable by the optionee at any time
during the 90 day period, provided the options were otherwise exercisable as of
the date of termination and have not expired by their own terms.
No option shall be assignable or transferable by the optionee except by
will or by the laws of descent and distribution, and each option is exercisable
during an optionee's lifetime only by the optionee and, at death, by his heirs,
executors or administrators.
The Director Plan shall be administered by the Board of Directors of the
Company, which may, subject to certain limitations, suspend, terminate or amend
the plan.
The grant of options will not result in taxable income to an optionee or a
tax deduction for the Company. The exercise of an option will result in taxable
ordinary income to the optionee and a corresponding deduction for the Company,
in each case equal to the difference between the fair market value of the shares
on the date the option was granted and the fair market value on the date the
option was exercised.
PROPOSAL TO APPROVE THE 1995 INCENTIVE AND NON-QUALIFIED
STOCK OPTION PLAN
The Board of Directors has determined that it is in the best interest of
the Company to continue its practice of making stock options available to those
employees responsible for the continued growth of the Company's business. The
Board of Directors believes that providing such employees with an opportunity to
acquire a proprietary interest in the Company creates an increased interest in
and greater concern for the growth, success and welfare of the Company.
Accordingly, the Board of Directors adopted the 1995 Incentive and Non-qualified
Stock Option Plan (the "Plan") on June 15, 1995, and directed that it be
submitted for shareholder consideration and approval. Approval of the Plan
requires the affirmative vote of a majority of the votes cast, in person or by
proxy, at the Annual Meeting.
The Board recommends a vote FOR approval of the 1995 Incentive and Non-
Qualified Stock Option Plan.
11
<PAGE>
The following is a brief summary of the proposed Plan. The complete text
is attached as appendix B to this proxy Statement and reference is made to such
Appendix for a complete statement of the provisions of the Plan.
The Plan provides for the granting of options to purchase up to 800,000
shares of the Company's Common Stock. The Plan will be administered by the
Board's Option Committee whose members shall be "disinterested persons" within
the meaning of federal securities laws. Participants under the Plan will be
selected by the Option Committee upon the recommendation of Management. All
employees will be eligible for selection to participate in the Plan. The Option
Committee will determine the number of shares to be optioned to any individual
under the Plan, and options will vest and become exercisable in the manner and
within the periods specified by the Option Committee in its discretion. The
number and kind of shares subject to the Plan can be appropriately adjusted in
the event of any change in the capital structure of the Company. Shareholders
will have no pre-emptive rights with regard to shares issued pursuant to the
Plan.
The Plan enables the Company to grant either "incentive stock options", as
defined in Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), or options that are note intended to be "incentive stock options". No
options may be granted under the Plan later than June 15, 2005. Any options
granted under the Plan must have an exercise period of no more than ten years.
The exercise price per share for each option may not be less than the fair
market value on the date of grant, determined as prescribed by the Code. The
Plan provides that payment for the portion exercised may be made only in whole
at the time of exercise of the option in cash or by delivery of already owned
shares of the Company's Common Stock, valued at its fair market value on the
exercise date. Proceeds received from optioned shares will be used for general
corporate purposes. To the extent that the aggregate fair market value
(determined as of the time such option is granted) of the common stock for which
any employee may have incentive stock options vest in any calendar year exceeds
$100,000, such excess incentive stock options shall be treated as non-qualified
options.
No option shall be assignable or transferable by the optionee except by
will or by the laws of descent and distribution, and each option is exercisable
during the lifetime of an optionee only by the optionee and at death by his
heirs, executors or administrators.
For optionees receiving grants under the Plan, options may be exercised
within 90 days after such persons cease to be employed by or cease to be
directors of the Company. The options shall be exercisable by the optionee at
any time during the 90 day period, provided the options were otherwise
exercisable as of the date of termination and have not expired by their own
terms.
The Board of Directors, subject to certain exceptions, may suspend,
terminate or amend the Plan at its discretion.
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No determination has been made with respect to future recipients of
options under the Plan and it is not possible to specify the names or positions
of the persons to whom options may be granted, or the number of shares, within
the limitations of the Plan, to be covered by such options.
Under currently applicable provisions of the Code, as amended, an optionee
will not be deemed to receive any income for federal income tax purposes upon
the grant of any option under the Plan, nor will the Company be entitled to a
tax deduction at that time. Upon the exercise of a non-incentive option, the
optionee will be deemed to have received ordinary income in an amount equal to
the difference between the exercise price and the market price of the shares on
the exercise date. The Company will be allowed an income tax deduction equal to
the excess of market value of the shares on the date of exercise over the cost
of such shares to the optionee. No income will be recognized by the optionee at
the time of exercise of an incentive stock option. If the stock is held at least
one year following the exercise date and at least two years from the date of
grant of the option, the optionee will realize a capital gain or loss upon sale,
measured as the difference between the exercise price and the sale price. If
both of these holding period requirements are not satisfied, ordinary income tax
treatment will apply to the amount of gain at sale or exercise, whichever is
less. If the actual gain exceeds the amount of ordinary income, the excess will
be considered short-term or long-term capital gain depending on how long the
shares are actually held. No income tax deduction will be allowed by the Company
with respect to shares purchased by an optionee upon the exercise of an
incentive stock option, provided such shares are held for the required periods
as described above.
Under the Code, as amended, an option will generally be disqualified from
receiving incentive stock option treatment if it is exercised more than three
months following termination of employment. However, if the optionee is
disabled, such statutory treatment is available for one year following
termination. If the optionee dies while employed by the Company or within three
months thereafter, the statutory time limit is waived altogether. In no event do
these statutory provisions extend the rights to exercise an option beyond those
provided by its terms.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Company selected KPMG Peat Marwick LLP
("Peat Marwick") as independent auditors for the year ended December 31, 1995.
Peat Marwick advised the Company that, in accordance with professional
standards, it would not perform any non-audit service which would impair its
independence for purposes of expressing an opinion on the Company's financial
statements. A representative of Peat Marwick will attend the meeting with the
opportunity to make a statement if such representative desires to do so and will
be available to respond to appropriate questions. The Audit Committee has not
yet made a recommendation of independent auditors for 1996.
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OTHER MATTERS
The Board of Directors of the Company does not intend to bring any other
matters before the meeting and does not know of any matters which will be
brought before the meeting by others. However, if any other matters properly
come before the meeting, it is the intention of the persons named in the
accompanying proxy to vote such proxy in accordance with their judgment on such
matters.
By Order of the Board of Directors
W. H. HAYES
Vice President and Secretary
Austin, Texas
May 2, 1996
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Appendix A
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
OF
AMERICAN PHYSICIANS SERVICE GROUP, INC.
A Texas Corporation
I. Purpose of Plan
The 1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN (the "Plan") is
intended to promote the interests of American Physicians Service Group, Inc., a
Texas corporation (the "Company"), and its stockholders by helping to award and
retain highly-qualified independent directors, and allowing them to develop a
sense of proprietorship and personal involvement in the development and
financial success of the Company. Accordingly, the Company shall grant to
directors of the Company who are not employees of the Company or any of its
subsidiaries ("Non- Employee Directors") the option ("Option") to purchase
shares of the common stock, $0.10 par value per share, of the Company ("Common
Stock"), as hereinafter set forth. Options granted under this Plan shall be
options which do not constitute incentive stock options, within the meaning of
section 422(b) of the Internal Revenue Code of 1986, as amended (the "Code").
II. Grant of Options
Options may be granted only to individuals who are Non-Employee
Directors of the Company and who are members of the Committee under the
Company's Incentive Stock Option Plan (the "Committee"). On the date on which a
Non-Employee Director is first elected or appointed as a member of the
Committee, he or she (the "Optionee") shall be granted an Option to purchase
30,000 shares of Common Stock. Each Optionee shall be automatically granted
options to purchase 30,000 shares of Common Stock on each anniversary of his/her
appointment to the Committee. For purposes of this Article II, each Non-Employee
Director who is also a member of the Committee in office on the effective date
of this Plan shall be deemed to have been first elected at such date.
If, as of any date that this Plan is in effect, there are not
sufficient shares of Common Stock available under the Plan to allow for the
grant to each Non-Employee Director of an option for the number of shares
provided herein, this Plan shall terminate as provided in Article X hereof. All
Options granted under this Plan shall be at the option price set forth in
Article V hereof and shall be subject to adjustment as provided in Article VII
hereof.
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III. Shares Subject to Plan
The aggregate number of shares of Common Stock that may be issued
pursuant to Options granted under this Plan shall not exceed 200,000 shares of
Common Stock (subject to adjustment as provided in Article VII). Such shares may
consist of authorized but unissued shares of Common Stock or previously issued
shares of Common Stock reacquired by the Company. Any of such shares which
remain unissued and which are not subject to outstanding Options at the
termination of this Plan shall cease to be subject to this Plan, but, until
termination of this Plan, the Company shall at all times make available a
sufficient number of shares to meet the requirements of this Plan. Should any
Option hereunder expire or terminate prior to its exercise in full, the shares
of Common Stock theretofore subject to such Option may again be subject to an
Option granted under this Plan to the extent permitted under Rule 16b-3. The
aggregate number of shares which may be issued under this Plan shall be subject
to adjustment as provided in Article VII hereof. Exercise of an Option in any
manner shall result in a decrease in the number of shares of Common Stock which
may thereafter be available, both for purposes of the Plan and for sale to any
one individual, by the number of shares as to which the Option is exercised.
IV. Option Agreements
Each Option shall be evidenced by a written agreement in the form
attached hereto as Exhibit A.
V. Option Price
The purchase price for a share of Common Stock issued under each Option
granted pursuant to this Plan shall be the fair market value for the Common
Stock at the time the Option is granted. For all purposes under the Plan, the
fair market value of a share of Common Stock on a particular date shall be equal
to the average of the high and low sales prices of the Common Stock (i) reported
by the National Market System of NASDAQ on that date or (ii) if the Common Stock
is listed on a national stock exchange, reported on the stock exchange composite
tape on that date; or, in either case, if no prices are reported on that date,
on the last preceding date on which such prices of the Common Stock are so
reported. If the Common Stock is traded over the counter at the time a
determination of its fair market value is required to be made hereunder, its
fair market value shall be deemed to be equal to the average between the
reported high and low or closing bid and ask prices of the Common Stock on the
most recent date on which the Common Stock was publicly traded. In the event the
Common Stock is not publicly traded at the time a determination of its value is
required to be made hereunder, the determination of its fair market value shall
be made by the Committee in such manner as it deems appropriate.
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<PAGE>
VI. Options Nontransferable
Each Option and all rights granted thereunder shall not be transferable
other than by will or the laws of descent and distribution, and shall be
exercisable during the Optionee's lifetime only by the Optionee or the
Optionee's guardian or legal representative; provided, however, that on and
after the date the Corporation elects to have this Plan governed under the
amendments to Rule 16b-3 effective on or after May 1, 1991, this Plan shall be
deemed to be amended to limit the transferability of Options, including any
exceptions thereto, to the same extent provided by Rule 16b-3 as so amended.
VII. Recapitalization or Reorganization
In the event of a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, an appropriate and
proportionate adjustment shall be made in the number of shares of Common Stock
for which Options may be granted pursuant to Article III hereof. A corresponding
change shall be made to the number and kind of shares, and the exercise price
per share, of unexercised Options.
VIII. Merger, Consolidation or Dissolution of Corporation
Following the merger of one or more corporations into the Corporation,
or any consolidation of the Corporation and one or more corporations in which
the Corporation is the surviving corporation, the exercise of Options under this
Plan shall apply to the shares of the surviving corporation.
Not withstanding any other provision of this Plan, all Options under
this plan shall terminate on the dissolution or liquidation of the Corporation,
or on any merger or consolidation in which the Corporation is not the surviving
corporation.
IX. Term of Plan
This Plan shall be effective on approval by the shareholders of the
Corporation in the manner required by Rule 16b-3. Except with respect to Options
then outstanding, if not sooner terminated under the provisions of Article VIII
or Article X, the Plan shall terminate upon and no further Options shall be
granted as of the date the remaining number of shares of Common Stock which may
be issued under the Plan pursuant to Article IV is not sufficient to cover the
Options required to be granted under Article III.
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<PAGE>
X. Amendment and Termination of Plan
The Board in its discretion may terminate this Plan at any time with
respect to any shares of Common Stock for which Options have not theretofore
been granted. The Board shall have the right to alter or amend this Plan or any
part hereof from time to time; provided, that this Plan shall not be amended
more than once every six months, other than to comport with changes in the Code,
the Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder; and provided, further, that no change in any Option heretofore
granted may be made which would impair the rights of an Optionee without the
consent of such Optionee; and provided, further, that the Board may not make any
alteration or amendment which would materially increase the benefits accruing to
participants under this Plan, increase the aggregate number of shares which may
be issued pursuant to the provisions of this Plan, change the class of
individuals eligible to receive Options under this Plan or extend the term of
this Plan, without the approval of the Stockholders of the Company.
XI. Compliance with Section 16
It is intended that this Plan and any grant of an Option made to a
person subject to Section 16 of the Securities Exchange Act of 1934, as amended
( the "1934 Act") meet all of the requirements of Rule 16b-3, as currently in
effect or as hereinafter modified or amended ("Rule 16b-3"), promulgated under
the 1934 Act. If any provision of this Plan or any such Option would disqualify
this Plan or such Option under, or would otherwise not comply with, Rule 16b-3,
such provision or Option shall be construed or deemed amended to conform to Rule
16b-3.
By: ________________________________
Chairman & Chief Executive Officer
4
<PAGE>
Appendix B
1995 INCENTIVE AND NON-QUALIFIED STOCK OPTION PLAN
OF
AMERICAN PHYSICIANS SERVICE GROUP, INC.
A Texas Corporation
I. Purpose of Plan
The purpose of this 1995 Incentive Stock Option Plan (this "Plan") is
to strengthen American Physicians Service Group, Inc. a Texas corporation (the
"Corporation"), and its subsidiaries, by providing stock options as a means to
attract, retain and motivate corporate personnel.
II. Administration
This Plan shall be administered by a committee (the "Committee")
composed of members selected by, and serving at the pleasure of, the Board of
Directors of the Company (the "Board"). The Committee shall be constituted so as
to permit the Plan to comply with Rule 16b-3, as currently in effect or as
hereinafter modified or amended ("Rule 16b-3"), promulgated under the Securities
Exchange Act of 1934, as amended (the "1934 Act"). Consistent with Rule 16b-3
each committee member shall be a disinterested person, i.e., a person who has
not been granted any equity security pursuant to a plan of the corporation or
any of its affiliates during the one year prior to his becoming a committee
member or during the period he serves as a committee member. The Committee shall
have the sole authority to select the persons entitled to receive Options (as
defined below) from among those eligible hereunder (the "Optionees") and to
establish the number of shares that may be issued under each Option to such
persons; provided, however, that, notwithstanding any provision in this Plan to
the contrary, the maximum number of shares of common stock, $.10 par value per
share of the Company (the "Common Stock") that may be subject to Options granted
under the Plan to an individual Optionee during any calendar year may not exceed
150,000 (subject to adjustment in the same manner as provided in Article IX
hereof to prevent dilution.) The limitation set forth in the preceding sentence
shall be applied in a manner which will permit compensation generated under the
Plan to constitute "performance-based" compensation for purposes of section
162(m) of the Internal Revenue Code of 1986, as amended ( the "Code"),
including, without limitation, counting against such maximum number of shares,
to the extent required under section 162(m) of the Code and applicable
interpretive authority thereunder, any shares subject to Options that are
cancelled or repriced. The Committee shall have the power to make all
determinations necessary for the administration of the Plan, subject to the
restrictions on committee power set forth in Texas law.
1
<PAGE>
III. Grant of Options
The Corporation is authorized to grant incentive stock options
("Incentive Stock Options") as defined in section 422 of the Code and options
that are not intended to be Incentive Stock Options (hereafter "Non-Qualified
Stock Options" and, together with Incentive Stock Options, the "Options"). Any
Option granted under this Plan shall be granted within 10 years form the date
this Plan is adopted, or the date this Plan is approved by the stockholders
pursuant to Article X, whichever is earlier. No option granted under this Plan
shall be exercisable by its terms after the expiration of 10 years from the
grant of the Option. Options may be granted only to individuals, (a) who are
employees (including officers and directors who are also employees) of the
Company or any parent or subsidiary corporation (as defined in section 424 of
the Code) of the Company or (b) who are directors of the Company who are not
members of the Committee, at the time the Option is granted. Options may be
granted to the same individual on more than one occasion.
Incentive Stock Options may not be granted to persons who own stock
possessing more than 10 percent of the total combined voting power of all
classes of stock of the Corporation, or of its parent or subsidiary, if any,
within the meaning of section 422(b)(6) of the Code, unless (i) at the time such
Option is granted the option price is at least 110% of the fair market value of
the Common Stock subject to such Option and (ii) such Option by its terms is not
exercisable after the expiration of five years from the date of the grant.
To the extent that the aggregate fair market value of Common Stock (as
determined in good faith by the Committee at the time the Incentive Stock Option
is granted), with respect to which Incentive Stock Options are exercisable for
the first time by an individual during any calendar year (under all incentive
stock option plans of the Corporation and any parent or subsidiary corporation)
exceeds $100,000, such excess Incentive Stock Options shall be treated as
Non-Qualified Stock Options. The Committee shall determine, in accordance with
applicable provisions of the Code, Treasury Regulations and other administrative
pronouncements which of an Optionee's Incentive Stock Options will not
constitute Incentive Stock Options because of such limitation and shall notify
the Optionee of such determination as soon as practicable after such
determination.
IV. Stock Subject to Plan
The aggregate number of shares of Common Stock that may be issued
pursuant to Options granted under this Plan shall not exceed 800,000 shares of
Common Stock (subject to adjustment as provided in article VIII). Such shares
may consist of authorized but unissued shares of Common Stock or previously
issued shares of Common stock reacquired by the Company. Any of such shares
which remain unissued and which are not subject to outstanding Options at the
termination of this Plan shall cease to be subject to this Plan, but, until
termination of this Plan, the Company shall at all times make available a
sufficient number of shares to meet the requirements of this Plan. Should any
Option hereunder expire or terminate prior to its exercise in full, the shares
of Common Stock theretofore subject to such Option may again be subject to an
Option granted under this Plan to the extent permitted under Rule 16b-3. The
aggregate number of shares which may be issued under this
2
<PAGE>
Plan shall be subject to adjustment as provided in Article VIII hereof. Exercise
of an Option in any manner shall result in a decrease in the number of shares of
Common Stock which may thereafter be available, both for purposes of the Plan
and for sale to any one individual, by the number of shares as to which the
Option is exercised. Separate stock certificates shall be issued by the Company
for those shares acquired pursuant to the exercise of an Incentive Stock Option
and for those shares acquired pursuant to the exercise of any Non-Qualified
Stock Options.
V. Option Agreements
Each Option shall be evidenced by a written agreement between the
Company and the Optionee ("Option Agreement") which shall contain such terms and
conditions as the Committee deems necessary, including, without limitation,
terms and conditions relating to the termination of Options. The terms and
conditions of the respective Option Agreements need not be identical. Moreover,
an Option Agreement may provide for the payment of the option price, in whole or
in part, by the delivery of a number of shares of Common Stock (plus cash if
necessary) having a fair market value equal to such option price.
VI. Option Price
The purchase price for a share of Common Stock subject to an Incentive
Stock Option granted pursuant to this Plan shall not be less than the fair
market value of the Common Stock subject to such Incentive Stock Option at the
time such Option is granted. The purchase price for a share of the Common Stock
subject to a Non-Qualifying Stock Option granted pursuant to this Plan shall be
not less than 100% of the fair market value of the Common Stock subject to such
Non-Qualifying Stock Option on the date such Option is granted.
For all purposes under the Plan, the fair market value of a share of
Common Stock on a particular date shall be equal to the average of the high and
low sales prices of the Common Stock (i) reported by the National Market System
of NASDAQ on that date or (ii) if the Common Stock is listed on a national stock
exchange, reported on the stock exchange composite tape on that date; or, in
either case, if no prices are reported on that date, on the last preceding date
on which such prices of the Common Stock are so reported. If the Common Stock is
traded over the counter at the time a determination of its fair market value is
required to be made hereunder, its fair market value shall be deemed to be equal
to the average between the reported high and low or closing bid and ask prices
of the Common Stock on the most recent date on which the Common Stock was
publicly traded. In the event the Common Stock is not publicly traded at the
time a determination of its value is required to be made hereunder, the
determination of its fair market value shall be made by the Committee in such
manner as it deems appropriate.
3
<PAGE>
VII. Options Nontransferable
Each Option and all rights granted thereunder shall not be transferable
other than by will or the laws of descent and distribution, and shall be
exercisable during the Optionee's lifetime only by the Optionee or the
Optionee's guardian or legal representative; provided, however, that on and
after the date the Corporation elects to have this Plan governed under the
amendments to Rule 16b-3 effective on or after May 1, 1991, this Plan shall be
deemed to be amended to limit the transferability of Options, including any
exceptions thereto, to the same extent provided by Rule 16b-3 as so amended.
VIII. Recapitalization or Reorganization
In the event of a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, an appropriate and
proportionate adjustment shall be made in the number of shares of Common Stock
for which Options may be granted pursuant to Article Iv hereof. A corresponding
change shall be made to the number and kind of shares, and the exercise price
per share, of unexercised Options.
IX. Merger, Consolidation or Dissolution of Corporation
Following the merger of one or more corporations into the Corporation,
or any consolidation of the Corporation and one or more corporations in which
the Corporation is the surviving corporation, the exercise of Options under this
Plan shall apply to the shares of the surviving corporation.
Not withstanding any other provision of this Plan, all Options under
this plan shall terminate on the dissolution or liquidation of the Corporation,
or on any merger or consolidation in which the Corporation is not the surviving
corporation.
X. Effective Date of Plan
This Plan shall be effective on approval by the affirmative vote of the
holders of a majority of the outstanding shares of capital stock of the Company
present or represented and entitled to vote thereon at a duly held shareholder
meeting or by unanimous written consent of the stockholders of the Corporation
in the manner required by Rule 16b-3.
XI. Amendment or Termination of Plan
The Board in its discretion may terminate this Plan at any time with
respect to any shares of Common Stock for which Options have not theretofore
been granted. The Board shall have the right to alter or amend this Plan or any
part hereof from time to time; provided, that no change in any Option heretofore
granted may be made which would impair the rights of the Optionee without the
consent of such Optionee; and provided, further, that (i) the Board may not make
any alteration or
4
<PAGE>
amendment which would decrease any authority granted to the Committee hereunder
in contravention of Rule 16b-3 and (ii) the Board may not make any alteration or
amendment which would materially increase the benefits accruing to participants
under the Plan, increase the aggregate number of shares which may be issued
pursuant to the provisions of the Plan, change the class of individuals eligible
to receive Options under the Plan or extend the term of the Plan, without the
approval of the Stockholders of the Company.
XII. Compliance with Section 16
With respect to persons subject to Section 16 of the 1934 Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the 1934 Act. To the extent any
provision of the Plan or action by the Committee fails to so comply, it shall be
deemed null and void, to the extent permitted by law and deemed advisable by the
Committee.
By: __________________________________
Kenneth S. Shifrin, Chairman of the Board
5
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 13, 1996
The undersigned hereby (a) acknowledges receipt of the Notice of Annual Meeting
of Shareholders of American Physicians Service Group, Inc. (the "Company") to be
held on June 13, 1996, and the Proxy Statement in connection therewith, each
dated May 2, 1996, (b) appoints Kenneth S. Shifrin and William H. Hayes, or
either of them, as Proxies, each with the power to appoint a substitute, (c)
authorizes the Proxies to represent and vote, as designated below, all the
shares of Common Stock of American Physicians Service Group, Inc., held of
record by the undersigned on April 26, 1996, at such annual meeting and at any
adjournment(s) thereof and (d) revokes any proxies heretofore given.
Election of Directors, Nominees: (change of address)
Jack R. Chandler, M.D., _________________________
Richard J. Clark,
_________________________
Jack Murphy,
Robert L. Myer, _________________________
William A. Searles,
and Kenneth S. Shifrin. (If you have written in the above space,
please mark the corresponding box on the
reverse side of this card.)
THIS PROXY WILL BE VOTED AS SPECIFIED, IF NO SPECIFICATION IS INDICATED, THIS
PROXY WILL BE VOTED FOR THE ELECTION TO THE BOARD OF DIRECTORS OF THE NOMINEES
LISTED ON THIS PROXY, FOR THE STOCK OPTION PROPOSALS AND, IN THE DISCRETION OF
THE PROXIES, ON ANY OTHER BUSINESS.
SEE REVERSE
SIDE
<PAGE>
Please mark your
votes as in this
example.
FOR WITHHELD FOR AGAINST ABSTAIN
1 Election of 2 Approval of
Directors the 1995 Non-
(see reverse) Employee Director
---- ------ Stock Option Plan ____ ____ _____
3 Approval of
For, except vote withheld the 1995 Incentive
from The following nominee(s): and Non-Qualified
Stock Option Plan ____ ____ _____
4 In their discretion
the Proxies are
authorized to vote
upon such other
business as may
properly come before
the meeting or any
adjournemnt(s)thereof
Change of
Address
SIGNATURE(S)_________________________ DATE _________________
SIGNATURE(S)_________________________ DATE _________________
NOTE: Please sign your name above exactly as it appears on your
stock certificate, date, and return promptly. When signing on
behalf of a corporation, partnership, estate, trust, or in any
other representative capacity, please sign name and title. For
joint accounts, each joint owner must sign.
<PAGE>
