SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities and Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE
[X] Definitive Proxy Statement OF THE COMMISSION
[ ] Definitive Additional Materials ONLY (AS PERMITTED BY
[ ] Soliciting Material Pursuant to RULE 14a-6 (e)(2))
Rule 14a-11(c) or Rule 14a-12
REALTY INCOME CORPORATION
(Name of Registrant as Specified in its Charter)
Realty Income Corporation
(Name of Person(s) Filing Proxy Statement,
if other than the 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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rune 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule
and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
(Realty Income Corporation Letterhead)
March 27, 2000
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Realty Income Corporation to be held at 9:00 a.m.,
local time, on May 3, 2000 at the California Center for the Arts
Escondido, 340 North Escondido Boulevard, Escondido, California.
At the Annual Meeting, you will be asked to consider and vote upon
the election of three directors to the Board of Directors of the
Company.
The election of the members of the Board of Directors of the
Company is more fully described in the accompanying Proxy Statement.
We urge you to carefully review the Proxy Statement.
The Company's Board of Directors recommends a VOTE FOR the
election of each nominee to the Board of Directors named in the
accompanying Proxy Statement.
YOUR VOTE IS IMPORTANT TO THE COMPANY, WHETHER YOU OWN FEW OR MANY
SHARES! Please complete, date and sign the enclosed proxy card and
return it in the accompanying postage paid envelope, even if you plan
to attend the Annual Meeting. If you attend the Annual Meeting, you
may, if you wish, withdraw your proxy and vote in person.
Sincerely,
/s/THOMAS A. LEWIS
------------------
THOMAS A. LEWIS
Vice Chairman of the Board,
Chief Executive Officer, and President
REALTY INCOME CORPORATION
220 West Crest Street
Escondido, California 92025-1707
---------------------
NOTICE OF ANNUAL MEETING TO BE HELD ON
May 3, 2000
---------------------
To the Stockholders of
Realty Income Corporation:
Notice is hereby given that the Annual Meeting of Stockholders
(the "Annual Meeting") of Realty Income Corporation, a Maryland
corporation (the "Company" or "Realty Income"), will be held at the
California Center for the Arts Escondido, 340 North Escondido
Boulevard, Escondido, California, 92025 at 9:00 a.m., local time, on
May 3, 2000, to consider and act upon:
1. The election of three members of the Board of Directors of
the Company; and
2. Such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
The election of directors is more fully described in the
accompanying Proxy Statement, which forms a part of this Notice.
During the course of the Annual Meeting, management will report on
the current activities of Realty Income and comment on its future
plans. A discussion period is planned so that stockholders will have
an opportunity to ask questions and make appropriate comments.
The Board of Directors has fixed the close of business on March 7,
2000 as the record date (the "Record Date") for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting
or any adjournment or postponement thereof. Only stockholders of
record on the Record Date will be entitled to notice of and to vote at
the Annual Meeting or any adjournment or postponement thereof. A list
of stockholders will be available for inspection at the offices of the
Company at 220 West Crest Street, Escondido, California, at least ten
days prior to the Annual Meeting.
If you plan to be present, please notify the undersigned so that
identification can be prepared for you. Whether or not you plan to
attend the Annual Meeting, please execute, date and return promptly
the enclosed proxy. A return envelope is enclosed for your
convenience and requires no postage for mailing in the United States.
<PAGE>
If you are present at the Annual Meeting you may, if you wish,
withdraw your proxy and vote in person. Thank you for your interest
and consideration.
Sincerely,
/s/MICHAEL R. PFEIFFER
----------------------
Michael R. Pfeiffer
March 27, 2000 Executive Vice President,
General Counsel and Secretary
YOUR VOTE IS IMPORTANT
TO VOTE YOUR SHARES, PLEASE SIGN, DATE AND COMPLETE THE ENCLOSED
PROXY AND MAIL IT IN THE ENCLOSED RETURN ENVELOPE
(Realty Income Corporation Letterhead)
REALTY INCOME CORPORATION
220 West Crest Street
Escondido, California 92025-1707
PROXY STATEMENT
for
ANNUAL MEETING OF STOCKHOLDERS
May 3, 2000
This Proxy Statement is furnished to the stockholders of Realty
Income Corporation, a Maryland corporation ("Realty Income", the
"Company", "we" or "our"), in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the Annual
Meeting of Stockholders (the "Annual Meeting") to be held on May 3,
2000, at 9:00 a.m., local time, at the California Center for the Arts
Escondido, 340 North Escondido Boulevard, Escondido, California 92025,
and at any adjournment or postponement thereof. References to the
Company include R.I.C. Advisor, Inc., or the Advisor, prior to its
merger into the Company in August 1995. The approximate date on which
this proxy statement and form of proxy solicited on behalf of the
Board of Directors will first be sent to the Company's stockholders is
on or about March 28, 2000.
At the Annual Meeting, holders of record of shares of our Common
Stock will consider and vote upon (i) the election of three members of
the Board of Directors of the Company and (ii) such other business as
may properly come before the Annual Meeting or any adjournment or
postponement thereof. The Board of Directors recommends a vote FOR
each nominee to the Board of Directors named in this Proxy Statement.
See "Proposal to Elect Directors."
On March 7, 2000, the record date for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting,
we had 26,793,370 shares of common stock, par value $1.00 per share
(the "Common Stock"), outstanding. Each such share of Common Stock is
entitled to one vote on each matter properly brought before the
meeting. Stockholders are not permitted to cumulate their shares of
Common Stock for the purpose of electing directors or otherwise. The
presence at the Annual Meeting, in person or by proxy, of stockholders
entitled to cast a majority of all the votes entitled to be cast at
the meeting will constitute a quorum.
Unless contrary instructions are indicated on the proxy, all
shares of Common Stock represented by valid proxies received pursuant
to this solicitation (and not revoked before they are exercised) will
be voted at the Annual Meeting FOR the election of each nominee to the
Board of Directors named in this Proxy Statement. With respect to any
other business which may properly come before the Annual Meeting and
Page 1
<PAGE>
be submitted to a vote of stockholders, proxies received by the Board
of Directors will be exercised in the discretion of the designated
proxy holders. A stockholder may revoke his or her proxy at any time
before exercise by delivering to the Secretary of the Company a
written notice of revocation, by filing with the Secretary of the
Company a duly executed proxy bearing a later date, or by voting in
person at the Annual Meeting. Attendance at the Annual Meeting will
not by itself be sufficient to revoke a proxy.
The election inspector will treat shares represented by properly
signed and returned proxies marked WITHHOLD AUTHORITY as shares that
are present and entitled to vote for purposes of determining the
presence of a quorum. For purposes of this election of directors,
withheld votes will not be counted as votes cast and will have no
effect on the result of the vote.
If the Annual Meeting is postponed or adjourned for any reason, at
any subsequent reconvening of the Annual Meeting all proxies will be
voted in the same manner as such proxies would have been voted at the
original convening of the Annual Meeting (except for any proxies that
have theretofore effectively been revoked or withdrawn).
We will bear the cost of soliciting proxies from our stockholders.
In addition to solicitation by mail, our directors, officers and
employees may solicit proxies by telephone, telegram or otherwise.
Such directors, officers and employees of the Company will not be
additionally compensated for such solicitation, but may be reimbursed
for out-of-pocket expenses incurred in connection therewith.
Brokerage firms, fiduciaries and other custodians who forward
soliciting material to the beneficial owners of shares of Common Stock
held of record by them will be reimbursed for their reasonable
expenses incurred in forwarding such material.
Our Common Stock is traded on the New York Stock Exchange, Inc.
("NYSE") under the ticker symbol "O". On March 14, 2000, the last
reported sale price for the Company's Common Stock on the NYSE was
$20.25 per share.
No person is authorized to make any representation with respect to
the matters described in this Proxy Statement other than those
contained herein and, if given or made, such information or
representation must not be relied upon as having been authorized by
the Company or any other person.
---------------------------
The date of this Proxy Statement is March 27, 2000.
Page 2
PROPOSAL 1
ELECTION OF DIRECTORS
General
Our Board of Directors currently consists of seven directors
divided into three classes, designated as Class I, Class II, and Class
III. Each class is elected to a three-year term and the election of
directors is staggered, so that only one class of directors is elected
at each annual meeting of stockholders. The Class III directors'
terms expire at the 2000 Annual Meeting of stockholders. As such,
stockholders of record as of March 7, 2000 will be entitled to vote on
the election of three Class III directors for three-year terms at the
Annual Meeting.
Vote Required; Board Recommendation
A plurality of all the votes cast at the Annual Meeting, assuming
a quorum is present, will be sufficient to elect each director.
Accordingly, withheld votes as to the election of directors will not
affect the result of the vote. Unless instructed to the contrary, the
shares represented by the proxies will be voted FOR the election of
each of the director nominees named below. Although it is anticipated
that each nominee will be able to serve as a director, should any
nominee become unavailable to serve, the shares represented by the
proxies will be voted for another person or persons designated by our
Board of Directors. In no event will the proxies be voted for more
than three nominees.
Director Nominees
The following table sets forth certain information regarding the
Director nominees, each of whom is a current director of Realty
Income:
<TABLE>
Name Age Title Class
<S> <C> <C> <C> <C>
William E. Clark 62 Chairman of III
the Board
Thomas A. Lewis 47 Vice Chairman III
of the Board,
Chief Executive
Officer and
President
Kathleen R. Allen, 54 Director III
Ph.D.
</TABLE>
Page 3
William E. Clark is the Chairman of the Board of Directors and a
Director of the Company and has served in this position since 1969.
He served as Chief Executive Officer of the Company from 1969 to May
1997. Mr. Clark was also co-founder of Realty Income Corporation. He
has been involved as a principal in commercial real estate acquisi-
tion, development, management and sales for over 30 years. His
involvement includes land acquisition, tenant lease negotiations,
construction and sales of commercial properties for regional and
national fast-food restaurants, automotive and retail chain store
operations throughout the United States. Mr. Clark is a member of the
Audit Committee, the Compensation Committee and the Corporate
Governance Committee.
Thomas A. Lewis is Chief Executive Officer and President of Realty
Income. He is also Vice Chairman of the Board of Directors and has
been a member of the Board since September 1993. He joined the
Company in 1987 and served in a variety of executive positions
including Vice President, Capital Markets until 1997 when he was named
Chief Executive Officer. Prior to joining Realty Income, he was an
executive with Johnstown Capital, a real estate management and
syndication company (1982-1987), an Investment Specialist with Sutro &
Company, a member of the New York Stock Exchange (1979-1982), and a
marketing executive with Proctor & Gamble (1974-1979). Mr. Lewis
serves as a director and officer of Crest Net Lease, Inc., a
subsidiary of the Company.
Kathleen R. Allen, Ph.D. has been a Director of the Company since
February 2000. She is a Professor at the University of Southern
California and the Coordinator of the Marshall School of Business,
Undergraduate Entrepreneur Program. She is also the co-founder,
Chairman and Chief Financial Officer of Gentech Corporation, a
manufacturer of industrial power source machines. She serves as a
consultant to Microsoft Corporation and two medical technology
ventures, and is the author of ten books in the field of
entrepreneurship and technology, a field in which she is considered an
expert. Dr. Allen is a member of the Audit Committee, the
Compensation Committee and the Corporate Governance Committee.
Incumbent Directors
<TABLE>
Name Age Title Class
<S> <C> <C> <C>
Roger P. Kuppinger 59 Director I
Michael D. McKee 54 Director I
Donald R. Cameron 60 Director II
Willard H. Smith Jr. 63 Director II
</TABLE>
Page 4
<PAGE>
Roger P. Kuppinger has been a Director of the Company since August
1994. He is a self-employed investment banker and financial advisor
who is an active investor in both private and public companies. Prior
to March 1994, he was a Managing Director at the investment banking
firm of Sutro & Co. Inc. Prior to joining Sutro in 1969, he worked at
First Interstate Bank, formerly named United California Bank (1964-
1969). He has served on over ten boards of directors for both public
and private companies, and currently serves on the board of directors
of BRE Properties, Inc. Mr. Kuppinger is chairman of the Audit
Committee and is a member of the Compensation Committee and the
Corporate Governance Committee.
Michael D. McKee has been a Director of the Company since August
1994. He is Vice Chairman (July 1999 - present) and Chief Financial
Officer (January 1997 - present) of The Irvine Company and was
Executive Vice President (March 1994 - July 1999) of The Irvine
Company. Prior to joining The Irvine Company, he was a partner in the
law firm of Latham & Watkins (1986-1994). His business and legal
experience includes numerous acquisition and disposition transactions,
as well as a variety of public and private offerings of equity and
debt securities. He is currently a member of the board of directors
of The Irvine Company, Health Care Property Investors, Inc. and
Mandalay Bay Resorts. Mr. McKee is a member of the Compensation
Committee, the Audit Committee and the Corporate Governance Committee.
Donald R. Cameron has been a Director of the Company since August
1994. He is a co-founder and President of Cameron, Murphy & Spangler,
Inc., a securities broker-dealer firm and registered investment
advisor located in Pasadena, California. Prior to founding Cameron,
Murphy & Spangler in 1975, he worked at the securities brokerage firm
of Glore Forgan Staats, Inc. and its successors (1969-1975). Mr.
Cameron is chairman of the Compensation Committee and is a member of
the Audit Committee and the Corporate Governance Committee.
Willard H. Smith Jr. has been a Director of the Company since July
1996. He was the Managing Director, Equity Capital Markets Division,
of Merrill Lynch & Co. from 1983 until his retirement in 1996. Prior
to joining Merrill Lynch in 1979, he was employed by F. Eberstadt &
Co. (1971 - 1979). Mr. Smith also serves on the boards of directors
of six investment companies: Cohen & Steers Realty Shares; Cohen &
Steers Realty Income Fund; Cohen & Steers Total Return Realty Fund;
Cohen & Steers Special Equity Fund, Inc., Cohen & Steers Equity Income
Fund, and Cohen & Steers Institutional Realty Shares, Inc. He is also
a member of the board of directors of Essex Property Trust and
Highwoods Property Trust, two NYSE-listed REITs, and Willis Lease
Finance Corporation, a NASDAQ-listed company. Mr. Smith also serves
as a director of Crest Net Lease, Inc., a subsidiary of the Company.
Mr. Smith is chairman of the Corporate Governance Committee and is a
member of the Audit Committee and the Compensation Committee.
Page 5
<PAGE>
Committees of the Board of Directors
The Audit Committee of the Board of Directors is comprised of Dr.
Allen and Messrs. Cameron, Clark, Kuppinger (chairman), McKee and
Smith. The Audit Committee's principal responsibilities include
recommending to the Board of Directors the selection of the our
independent auditors, approving any special assignments given to the
independent auditors and reviewing (i) the scope and results of the
audit engagement with the independent auditors and management,
including the accountant's letter of comments and management's
responses thereto, (ii) the independence of the independent auditors,
(iii) the effectiveness and efficiency of our internal accounting
staff and (iv) any proposed significant accounting changes.
The Compensation Committee of the Board of Directors is comprised
of Dr. Allen and Messrs. Cameron (chairman), Clark, Kuppinger, McKee
and Smith. The Compensation Committee's principal responsibilities
include establishing remuneration levels for officers of the Company,
reviewing management organization and development, reviewing
significant employee benefits programs and establishing and
administering executive compensation programs, including bonus plans,
stock option and other equity-based programs, deferred compensation
plans and any other cash or stock incentive programs.
The Corporate Governance Committee of the Board of Directors is
comprised of Dr. Allen and Messrs. Cameron, Clark, Kuppinger, McKee
and Smith (chairman). The Corporate Governance Committee's principal
purpose is to provide counsel to the Board of Directors with respect
to (i) organization, membership and function of the Board of
Directors, (ii) structure and membership of the committees of the
Board of Directors and (iii) succession planning for the executive
management of the Company.
The Board of Directors may from time to time establish certain
other committees to facilitate the management of the Company.
Meetings and Attendance
The Board of Directors met 12 times during the fiscal year ended
December 31, 1999. In 1999, the Audit Committee met two times, the
Compensation Committee met three times and the Corporate Governance
Committee met two times. All directors attended at least 75% of the
aggregate of (i) the total number of meetings of the Board while they
were on the Board and (ii) the total number of meetings of the
committees of the Board on which such directors served.
Page 6
<PAGE>
Compensation of the Company's Directors
No officer of the Company receives or will receive any compensation
for serving the Company as a member of the Board of Directors or any
of its committees. Directors who are not officers of the Company
receive the following fees:
- - $15,000 annual fee, the chairman of the Board of Directors
receives an annual fee of $30,000;
- - $1,000 for attending Board of Directors meetings in person ($1,500
for the chairman of the Board);
- - $500 for attending Board of Directors committee meetings in person
($1,000 for the chairman of the committee);
- - $500 for attending Board of Directors meetings by telephone ($750
for the chairman of the Board);
- - $250 for attending Board of Directors committee meetings by
telephone ($500 for the chairman of the committee).
We may also reimburse such directors for travel expenses incurred
in connection with their activities on behalf of the Company. Our
stock incentive plan provides that, upon his or her initial election
to the Board of Directors and at each Annual Meeting of Stockholders
thereafter, if the Director is still serving as a Director, each
Director who is not an officer of the Company is automatically granted
options to purchase 5,000 shares of Realty Income Common stock at the
then current market price. These options vest during the Director's
continued service period on the first anniversary of the date of the
grant.
SENIOR OFFICERS OF THE COMPANY
<TABLE>
Name Title Age
- ------------------- --------------------------------------- ---
<S> <C> <C>
Thomas A. Lewis Vice Chairman of the Board, Chief 47
Executive Officer and President
Gary M. Malino Executive Vice President, Chief 42
Financial Officer and Treasurer
Michael R. Pfeiffer Executive Vice President, General 39
Counsel and Secretary
Kim S. Kundrak Senior Vice President, Portfolio 43
Acquisitions
Mark G. Selman Senior Vice President, Portfolio 45
Management
</TABLE>
Page 7
<PAGE>
Biographical information with respect to Mr. Lewis is set forth
above under Director Nominees.
Gary M. Malino is Executive Vice President, Chief Financial
Officer and Treasurer of Realty Income. He joined the Company in 1985
and served in various executive positions until his promotion to Chief
Financial Officer in 1994. Prior to joining Realty Income, he was a
Certified Public Accountant with an accounting firm (1981-1985) and
Assistant Controller with McMillan Development Company, a real estate
development company (1979-1981).
Michael R. Pfeiffer is Executive Vice President, General Counsel
and Secretary of Realty Income. He joined the Company in 1990 and
served as corporate counsel for the Company until 1995 when he was
named General Counsel and Secretary. Prior to joining Realty Income,
he was in private practice for a firm specializing in real estate
transactional law (1987-1990) and served as Associate Counsel with
First American Title Insurance Company (1986-1987). He is a licensed
attorney and member of the State Bar of California and Florida.
Kim S. Kundrak is Senior Vice President, Portfolio Acquisitions.
He joined the Company in 1996 and served as both a Director of
Portfolio Acquisitions as well as National Accounts Manager prior to
being promoted to Senior Vice President. Before joining Realty
Income, he was Chief Financial Officer and Vice President of Asset
Management for Burnham Pacific Properties, a San Diego-based real
estate investment trust (1987-1995). He also served as General
Manager of a regional mall for the Ernest W. Hahn Company (1982-1985).
Mark G. Selman is Senior Vice President, Portfolio Management. He
joined the Company in 1997 and served as both a Director and Vice
President of Portfolio Management before being promoted to Senior Vice
President. Prior to joining Realty Income, he was with the Real
Estate Consulting Group of KPMG Peat Marwick LLP (1989-1997) and was
an investment advisor and registered representative for the investment
firms of Wedbush, Noble, Cook (1983-1986) and Kidder Peabody (1986-
1988).
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning the
compensation awarded to, earned by or paid during the fiscal years
ended December 31, 1999, 1998 and 1997 to our Chief Executive Officer
and to the other four most highly compensated executive officers of
the Company for the fiscal years ended December 31, 1999, 1998 and
1997 (the "Named Executive Officers").
Page 8
<PAGE>
<TABLE>
Annual Compensation Long-Term Compensation
------------------------- ----------------------
Awards (1)
---------------------
Name and Options Restricted
Principal Position Year Salary Bonus (#) Stock (2)
- -------------------- ------ -------- ------- ------ ----------
<S> <C> <C> <C> <C> <C>
Thomas A. Lewis
Vice Chairman of the 1999 $262,500 $75,000 40,000 $61,875
Board, Chief 1998 $250,000 $53,100 47,600 $52,238
Executive Officer 1997 $231,917 -- 63,800 $86,488
and President
Richard J. VanDerhoff(4)
Former President and 1999 $225,000 $10,935 -- --
Chief Operating 1998 $225,000 $27,405 24,600 $27,363
Officer 1997 $225,000 -- 62,000 $83,944
Gary M. Malino
Executive Vice 1999 $190,000 $30,000 20,000 $24,750
President, Chief 1998 $175,000 $19,934 17,900 $19,900
Financial Officer, 1997 $175,000 -- 37,600 $50,875
Treasurer
Michael R. Pfeiffer
Executive Vice 1999 $190,000 $30,000 20,000 $24,750
President, General 1998 $145,000 $17,324 15,500 $17,413
Counsel, Secretary 1997 $145,000 -- 31,200 $43,244
Richard G. Collins(5)
Former Senior Vice 1999 $155,000 $25,000 -- --
President, Portfolio 1998 $145,000 $15,693 14,100 $14,925
Acquisitions 1997 $137,945 -- 29,500 $40,700
Long-Term Compensation
-----------------------
All Other
Name and LTIP Compensation
Principal Position Year Payouts (3)
- -------------------- ------ ------- ------------
Thomas A. Lewis
Vice Chairman of the 1999 -- $4,800
Board, Chief 1998 -- $4,800
Executive Officer 1997 -- $4,750
and President
Richard J. VanDerhoff(4)
Former President and 1999 -- $4,800
Chief Operating 1998 -- $4,800
Officer 1997 -- $4,750
(table continued next page)
Page 9
(table continued)
Long-Term Compensation
-----------------------
All Other
Name and LTIP Compensation
Principal Position Year Payouts (3)
- -------------------- ------ ------- ------------
Gary M. Malino
Executive Vice 1999 -- $4,800
President, Chief 1998 -- $4,800
Financial Officer, 1997 -- $4,750
Treasurer
Michael R. Pfeiffer
Executive Vice 1999 -- $4,800
President, General 1998 -- $4,800
Counsel, Secretary 1997 -- $4,397
Richard G. Collins(5)
Former Senior Vice 1999 -- $ --
President, Portfolio 1998 -- $ --
Acquisitions 1997 -- $ 750
</TABLE>
[FN]
(1) The options and restricted stock shown as compensation for 1999,
1998 and 1997 were granted on January 1, 2000, January 1, 1999
and January 1, 1998, respectively. We grant options and
restricted stock from time to time to executive officers based on
performance during a fiscal year and, since such performance
often cannot be measured until after the end of a fiscal year,
the options and restricted stock grants may be made in the
subsequent fiscal year.
(2) Restricted stock is awarded pursuant to our management incentive
plan. All awards granted under the management incentive plan are
made in accordance with the provisions of our stock incentive
plan. Restricted stock vests equally over three years on each
anniversary of the grant date. Restricted stock is eligible to
receive distributions from the date of grant. At December 31,
1999, the Named Executives held 15,066 shares of restricted stock
valued at $310,736. During the three year period ended
December 31, 1999, 22,700 restricted shares were awarded to the
Named Executive Officers.
(3) Represents the amount we contribute pursuant to a 401(k)
retirement plan. Under the terms of this plan, we match 50% of
the employee's contribution to the plan, up to 6% of the
employee's salary. Employees may contribute up to 15% of their
salary, capped at $10,000.
(4) On December 31,1999, Richard J. VanDerhoff's employment with the
Company terminated.
Page 10
<PAGE>
(5) On January 1, 2000, Richard G. Collins transferred to Crest Net
Lease, Inc, of which the Company owns a 95% non-voting common
stock interest. Mr. Collins is the Chief Executive Officer and
President of Crest Net Lease, Inc.
</FN>
Option Grants in Last Fiscal Year
The following table provides information on options granted to the
Named Executive Officers on January 1, 2000 (as compensation for
performance in 1999).
<TABLE>
Individual Grants
- ----------------------------------------------------------------------
Percentage
of Total
Number of Options
Shares Granted to
Year Underlying Employees Exercise Expir-
of Options in Fiscal Price ation
Name Award Granted(1) Year (2) Per Share Date
- ------------------- ----- ---------- ---------- --------- -------
<S> <C> <C> <C> <C> <C>
Thomas A. Lewis 1999 40,000 29.2% 20.625 12/31/09
Gary M. Malino 1999 20,000 14.6% 20.625 12/31/09
Michael R. Pfeiffer 1999 20,000 14.6% 20.625 12/31/09
Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for
Year Option Term(3)
of -------------------------------
Name Award 5% 10%
- ------------------- ----- ------------- --------------
Thomas A. Lewis 1999 $ 518,838 $1,314,838
Gary M. Malino 1999 $ 259,419 $ 657,419
Michael R. Pfeiffer 1999 $ 259,419 $ 657,419
</TABLE>
[FN]
(1) These options were granted on January 1, 2000 as compensation for
performance during 1999. All such options vest ratably over
three years. Options are granted for a term of 10 years, subject
to earlier termination in certain events related to termination
of employment. The option exercise price is equal to the fair
market value of the shares on the date of grant.
(2) Percentages shown for 1999 represent the percentage of total
options granted to employees as compensation for performance in
1999 that were granted on January 1, 2000, respectively.
Page 11
<PAGE>
(3) Assumed annual rates of stock price appreciation for illustrative
purposes only. Actual stock prices will vary from time to time
based upon market factors and our financial performance. No
assurance can be given that these appreciation rates will be
achieved.
</FN>
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End
Option Value Table
The following table provides information related to the exercise
of stock options during the year ended December 31, 1999 by each of
the Named Executive Officers and the 1999 fiscal year-end value of in-
the-money exercisable and unexercised options.
<TABLE>
Value of
Number of Unexercised
Unexercised In-the-Money
Shares Options Options at
Acquir- at FY-End FY-End
ed on Value Exercisable/ Exerciseable/
Exer- Real- Unexercisable Unexercisable
Name cise ized (1) (1) (2)
- --------------------- ------ ----- -------------- ---------------
<S> <C> <C> <C> <C>
Thomas A. Lewis -- -- 78,100 / 53,000 $-- / --
Richard J. VanDerhoff(3) -- -- 72,833 / 37,067 $-- / --
Gary M. Malino -- -- 46,634 / 24,466 $-- / --
Michael R. Pfeiffer -- -- 34,967 / 20,733 $-- / --
Richard G. Collins(3) -- -- 28,334 / 19,233 $-- / --
</TABLE>
[FN]
(1) Excludes options granted on January 1, 2000 as compensation for
1999 (See "Executive Compensation-Summary Compensation Table").
(2) Market value of underlying Common Stock on date of fiscal year-
end minus the exercise price. The share price as of December 31,
1999 was $20.625.
(3) All options held were forfeited on January 1, 2000.
Employment Agreements
Effective January 1, 2000, each of Messrs. Lewis, Malino,
Pfeiffer, Kundrak and Selman has entered into employment agreements
with the Company pursuant to which each employee receives a base
Page 12
<PAGE>
salary of $300,000, $200,000, $200,000, $155,000 and $150,000,
respectively, and the right to receive severance compensation upon the
occurrence of certain events as specified in the agreements. The
employee may terminate the agreement at any time upon two weeks'
written notice to the Company. The Company may terminate the
agreement without cause at any time upon written notice to the
employee. The employment agreements provide that upon termination by
the Company, including termination resulting from a change in control
of the Company, the employee will be entitled to receive monthly
severance payments in an amount equal to the employee's base salary,
payable in monthly installments. Each of Messrs. Lewis, Malino, and
Pfeiffer is entitled to receive severance payments for 12 months
following termination, and each of Messrs. Kundrak and Selman is
entitled to receive severance payments for six months following
termination. The amount of severance compensation is increased by 50%
in the event of a termination resulting from a change in control of
the Company.
The employment agreements provide that the employee must devote
his full time, attention and energy to the business of the Company and
may not engage in any other business activity which would interfere
with the performance of his duties or be competitive with the Company,
unless specifically permitted by the Board. This restriction does not
prevent the employee from making passive investments in a business not
in competition with the Company, so long as the investment does not
require the employee's services in a manner that would impair the
performance of his duties under the employment agreement.
CERTAIN TRANSACTIONS
In connection with Mr. VanDerhoff terminating his employment with
the Company on December 31, 1999, he will receive a severance equal to
his base salary in 1999 of $225,000.
In January 2000, upon approval of the disinterested members of the
Board of Directors, the Company formed Crest Net Lease, Inc.,
investing $2.9 million and acquiring 95% of the common stock, all of
which is Class A and non-voting, and Messrs. Lewis, Malino, Pfeiffer,
Collins, Kundrak and Selman invested $150,000 and acquired 5% of the
common stock, all of which is Class B voting stock. The Company
entered into promissory notes in the principal amount of $37,500 for
Mr. Lewis and $22,500 each for Messrs. Malino, Pfeiffer, Collins,
Kundrak and Selman to finance their investment in Crest Net Lease,
Inc. The principal and interest on the promissory notes is due and
payable on January 1, 2003. Crest Net Lease was created to actively
buy and sell certain select properties, primarily to buyers using tax-
deferred exchanges, under Section 1031 of the Internal Revenue Service
Code. It is anticipated that the Company will make loans and,
possibly, other contributions to Crest Net Lease in connection with
its acquisition activities. Mr. Lewis and Mr. Smith are directors of
Crest Net Lease.
Page 13
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
In 1999, the Compensation Committee was comprised of five
independent non-employee directors. The Compensation Committee is
responsible for, among other things, establishing remuneration levels
for officers (including the Named Executive Officers) of the Company
and establishing and administering executive compensation programs.
Our compensation policies have been structured to link the
compensation of our executive officers with enhanced stockholder
value. Through the establishment of short- and long-term incentive
plans, we seek to align the financial interests of the executive
officers with those of our stockholders.
Executive Compensation Philosophy
In designing our compensation programs, we have followed our
belief that compensation should reflect the value created for
stockholders while supporting the business strategies and long-range
plans of the Company and the markets the Company serves. In doing so,
the compensation programs reflect the following themes:
A compensation program that stresses our financial
performance and the executive officers' individual
performance.
A compensation program that strengthens the relationship
between pay and performance by providing variable, at-risk
compensation that is reflective of current market practices
and comparable executive rates and is dependent upon the level
of success in meeting specified Company and individual
performance goals.
An annual incentive plan that supports a performance-oriented
environment and which generates a portion of compensation
based on the achievement of specific performance goals, with
superior performance resulting in total annual compensation
above competitive levels.
A long-term incentive plan that is designed to reward
executive officers for long-term strategic management of the
Company and the enhancement of stockholder value.
The Compensation Committee will review and determine the
compensation of our executive officers with this philosophy on
compensation as its basis.
Page 14
<PAGE>
Executive Compensation Components
Our executive compensation is based on three components, each of
which is intended to serve the overall compensation philosophy. Base
Salary. Base salary is set at a level competitive with amounts paid
to executive officers of comparable companies with similar business
structure, size and marketplace orientation. In determining
appropriate salary levels, the Compensation Committee considers the
individual's scope of responsibility, experience and performance. In
addition, the Compensation Committee reviews competitive market and
industry data. The data we review compares our compensation practices
to a group of comparable companies which tend to have similar business
structure, size and marketplace orientation.
Salaries for executive officers are reviewed by the Compensation
Committee on an annual basis. Increases to base salaries will be
driven by our assessment of competitive pay levels and by individual
performance. Base salaries allow executives to be rewarded for
individual performance based on our evaluation process which
encourages the development of executives and sustained levels of
contribution to the Company. Base salaries also offer security to
executives and allow the Company to attract competent executive talent
and maintain a stable management team.
Executive Incentive Compensation. We have adopted a management
incentive plan which is linked to the long-term performance of the
Company. Executive officers are eligible to receive annual grants of
cash, incentive stock options and restricted stock based upon the
achievement by the executive officers of annual financial criteria
stated in terms of target and maximum goals as determined by the
Compensation Committee at the beginning of the fiscal year and the
following three factors: (a) growth in our funds from operations
("FFO"), which is a common statistical benchmark in the real estate
investment trust ("REIT") industry, (b) our performance compared to a
peer group of comparable companies, and (c) the executive's individual
performance.
In keeping with our commitment to provide a total compensation
package which emphasizes at-risk components of compensation, awards
granted under the plan are intended to retain and motivate executive
officers to improve long-term stock market performance.
Chief Executive Officer Compensation. In 1999, Mr. Lewis received
base compensation of $262,500. In accordance with the terms of the
Management Incentive Plan, the Compensation Committee established an
FFO performance target at the beginning of the 1999 fiscal year and an
award under the Management Incentive Plan was attributable 60% to FFO
performance, 20% to total stockholder return as compared to the
Company's peer group and 20% to personal evaluation. Based on these
criteria and after reviewing competitive pay levels for the position
of Chief Executive Officer, the Compensation Committee determined to
award Mr. Lewis with a cash bonus of $75,000, 40,000 stock options and
Page 15
<PAGE>
3,000 shares of restricted stock for 1999. The restricted stock and
the stock options granted vest one-third each year assuming Mr. Lewis'
continued employment with the Company.
Under Section 162(m) of the Internal Revenue Code (the "Code"),
income tax deductions of publicly-traded companies in tax years
beginning on or after January 1, 1994 may be limited to the extent
total compensation (including base salary, annual bonus, stock option
exercises, and non-qualified benefits) for certain executive officers
exceeds $1 million (less the amount of any "excess parachute-payments"
as defined in Section 280G of the Code) in any one year. To the
extent that total compensation paid by the Company to any employee
exceeds $1 million in any one year, all or a portion of such excess
amount may not be deductible by the Company under Section 162(m) of
the Code. The Compensation Committee has designed our compensation so
that total compensation paid to any employee will not exceed $1
million in any one year, except for compensation payments which are
related to increases in the price of our common stock. We may also
pay compensation which is not deductible in other limited
circumstances when sound management of the Company so requires.
Donald R. Cameron, Chairman
William E. Clark
Roger P. Kuppinger
Michael D. McKee
Willard H. Smith Jr.
Date: March 27, 2000
The above report of the Compensation Committee will not be deemed to
be incorporated by reference into any filing by the Company under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except
to the extent that the Company specifically incorporates the same by
reference.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Cameron, Clark, Kuppinger, McKee, and Smith each served on the
Compensation Committee during 1999. None of Messrs. Cameron,
Kuppinger, McKee, and Smith have been an officer or employee of the
Company. Mr. Clark was formerly the Chief Executive Officer of the
Company until May 1997. None of the members of the Compensation
Committee have any financial relationship with the Company other than
disclosed herein.
Page 16
STOCK PERFORMANCE GRAPH
The chart below compares the performance of our Common Stock with
the performance of an index including all securities for U.S.
companies listed on Standard & Poor's 500 Total Return Index (the "S&P
500 Total Return Index") and of a peer group of companies, measuring
the changes in common stock prices for the five year period from
January 1, 1995 through December 31, 1999. The chart assumes an
investment of $100 on December 31, 1994, and as required by the
Commission, all values shown assume the reinvestment of all
distributions, if any, and, in the case of the peer group, are
weighted to reflect the market capitalization of the component
companies. The peer group consists of Commercial Net Lease Realty,
Franchise Finance Corporation of America, Lexington Corporate
Properties, Inc., and U.S. Restaurant Properties, Inc.
<TABLE>
TOTAL RETURN PERFORMANCE
[GRAPH]
Period Ending
---------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Index 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
- ---------- -------- -------- -------- -------- -------- --------
Realty Income
Corporation 100.00 145.15 166.58 191.07 201.79 183.43
Realty Income
Peer Index 100.00 138.53 178.79 203.16 194.77 181.85
S&P 500 100.00 137.58 169.03 225.44 289.79 350.50
</TABLE>
Page 17
<PAGE>
COMPLIANCE WITH FEDERAL SECURITIES LAWS
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires our officers and directors, and persons who own more than 10%
of a registered class of our equity securities (collectively,
"Insiders"), to file with the Commission initial reports of ownership
and reports of changes in ownership of our Common Stock and other
equity securities of the Company. Insiders are required by regulation
of the Commission to furnish the Company with copies of all Section
16(a) forms they file.
Based solely on our review of copies of Forms 3, 4, and 5, and the
amendments thereto, received by the Company for the year ended
December 31, 1999, or written representations from certain reporting
persons that no Forms 5 were required to be filed by those persons, we
believe that during the year ended December 31, 1999, all filings
requirements were complied with by its executive officers, directors
and beneficial owners of more than ten percent of our stock.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of March 7, 2000 certain
information with respect to the beneficial ownership of shares of our
Common Stock by (i) each director and Named Executive Officer and (ii)
all directors and executive officers of the Company as a group. We do
not know of any person who beneficially owns 5% or more of the
outstanding shares of our Common Stock. Except as otherwise noted, we
believe that the beneficial owners of shares of our Common Stock
listed below, based on information furnished by such owners, have sole
voting and investment power with respect to such shares.
<TABLE>
Shares of Beneficial
Ownership of Common Percent of
Name of Beneficial Owner Stock of the Company Class
- ------------------------- -------------------- ----------
<S> <C> <C>
William E. Clark (1) 534,501 2.0%
Thomas A. Lewis (2) 165,023 *
Gary M. Malino (3) 114,042 *
Richard J. VanDerhoff (4) 81,515 *
Michael R. Pfeiffer (5) 39,567 *
Donald R. Cameron (6) 36,700 *
Michael D. McKee (7) 27,000 *
Roger P. Kuppinger (8) 25,950 *
(table continued next page)
Page 18
<PAGE>
(table continued)
Shares of Beneficial
Ownership of Common Percent of
Name of Beneficial Owner Stock of the Company Class
- ------------------------- -------------------- ----------
<S> <C> <C>
Willard H. Smith Jr. (9) 23,500 *
Richard G. Collins 1,833 *
Kathleen R. Allen, Ph.D. -- --
All directors and executive
officers of the Company, as a
group (13 persons)(10) 1,058,521 3.9%
- ----------------------
*Less than one percent
</TABLE>
[FN]
(1) Mr. Clark's total includes 518,623 shares owned of record by The
William E. Clark, Jr. and Evelyn J. Clark Family Trust (the
"Clark Family Trust"), of which he is a trustee and 449 shares
owned of record by his wife. Mr. Clark disclaims beneficial
ownership of the shares owned of record by his wife. Mr. Clark's
total includes 15,000 shares subject to options that are
exercisable within 60 days of March 7, 2000.
(2) Mr. Lewis' total includes 78,100 shares subject to options that
are exercisable within 60 days of March 7, 2000.
(3) Mr. Malino's total includes 206 shares owned of record by his
wife, as to which he disclaims beneficial ownership, and 1,043
shares owned of record jointly with his wife, as to which he
shares voting and disposition power with his wife. Mr. Malino's
total includes 46,633 shares subject to options that are
exercisable within 60 days of March 7, 2000.
(4) Mr. VanDerhoff's total includes 2,440 shares owned of record by
his wife.
(5) Mr. Pfeiffer's total includes 34,967 shares subject to options
that are exercisable within 60 days of March 7, 2000.
(6) Mr. Cameron's total includes 10,200 shares owned of record by the
Cameron, Murphy and Spangler, Inc. Amended and Restated Pension
Trust dated April 1, 1984, of which he is the trustee. Of the
10,200 shares, 10,000 shares are in the account of Mr. Cameron
and 200 shares in the account of Lachlan Cameron. Mr. Cameron's
total also includes 1,500 shares owned of record by his son,
Donald Cameron. Mr. Cameron's total includes 25,000 shares
subject to options that are exercisable within 60 days of
March 7, 2000. Mr. Cameron disclaims beneficial ownership of the
Page 19
<PAGE>
1,500 shares owned by his son and the 200 shares owned by the
Cameron, Murphy and Spangler, Inc. Amended and Restated Pension
Trust in the account of Lachlan Cameron.
(7) Mr. McKee's total includes 25,000 shares subject to options that
are exercisable within 60 days of March 7, 2000.
(8) Mr. Kuppinger's total includes 25,000 shares subject to options
that are exercisable within 60 days of March 7, 2000.
(9) Mr. Smith's total includes 22,500 shares subject to options that
are exercisable within 60 days of March 7, 2000.
(10) See notes (1) though (9)
(/FN>
The following table sets forth as of March 7, 2000 certain information
with respect to the beneficial ownership of shares of our Class B
Preferred Stock by (i) each director and Named Executive Officer and
(ii) all directors and executive officers of the Company as a group.
We do not know of any person who beneficially owns 5% or more of the
outstanding shares of our Class B Preferred Stock. Except as
otherwise noted, we believe that the beneficial owners of shares of
our Class B Preferred Stock listed below, based on information
furnished by such owners, have sole voting and investment power with
respect to such shares.
<TABLE>
Shares of Beneficial
Ownership of Class B
Preferred Stock of Percent of
Name of Beneficial Owner the Company Class
- ------------------------- -------------------- ----------
<S> <C> <C>
Donald R. Cameron 2,000 *
All directors and executive
officers of the Company, as a
group (13 persons) 2,000 *
</TABLE>
The following table sets forth as of March 7, 2000 certain
information with respect to the beneficial ownership of shares of our
Class B Common Stock of Crest Net Lease, Inc. by (i) each director and
Named Executive Officer and (ii) all directors and executive officers
of the Company as a group. We believe that the beneficial owners of
shares of our Class B Common Stock of Crest Net Lease, Inc. listed
below, based on information furnished by such owners, have sole voting
and investment power with respect to such shares.
Page 20
<PAGE>
<TABLE>
Shares of Beneficial
Ownership of Class B
Common Stock of Percent of
Name of Beneficial Owner Crest Net Lease, Inc.(1) Class
- ------------------------- ------------------------ ----------
<S> <C> <C>
Thomas A. Lewis 3.0 25.0%
Gary M. Malino 1.8 15.0%
Michael R. Pfeiffer 1.8 15.0%
Richard G. Collins 1.8 15.0%
All directors and executive
officers of the Company, as a
group (13 persons) 12.0 100.0%
</TABLE>
[FN]
(1) The Class B common stock of Crest Net Lease represents 5%
economic ownership of Crest Net Lease, but 100% of the voting
stock. The Company holds 100% of the Class A common stock of
Crest Net Lease, Inc. which represents 95% economic ownership of
Crest Net Lease. The Class A common stock is non-voting stock.
</FN>
AUDITORS
Subject to its discretion to appoint other auditors if it deems
such action appropriate, the Board of Directors has retained KPMG LLP
as our auditors for the current fiscal year. The Board of Directors
has been advised that KPMG LLP is independent with respect to the
Company and its subsidiaries within the meaning of the Securities Act
and the applicable published rules and regulations thereunder.
Representatives of KPMG LLP are expected to be present at the Annual
Meeting and will have the opportunity to make statements if they
desire and to respond to appropriate questions from stockholders.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
In order for stockholder proposals otherwise satisfying the
eligibility requirements of SEC Rule 14a-8 to be considered for
inclusion in our Proxy Statement, they must be received by us at our
principal office in Escondido, California, on or before November 27,
2000.
In addition, if a stockholder desires to bring business (including
director nominations) before our 2001 Annual Meeting that is or is not
the subject of a proposal timely submitted for inclusion in our Proxy
Page 21
<PAGE>
Statement, written notice of such business, as prescribed in our
Bylaws, must be received by our Secretary between November 28, 2000
and December 28, 2000. For additional requirements, a stockholder may
refer to our Bylaws, Section 12, "Nominations and Stockholder
Business," a copy of which may be obtained from the Company's
Secretary. If we do not receive timely notice pursuant to our Bylaws,
any proposal will be excluded from consideration at the meeting,
regardless of any earlier notice provided in accord with SEC Rule 14a-
8.
YOUR PROXY IS IMPORTANT
WHETHER YOU OWN FEW OR MANY SHARES
Please date, sign and mail the enclosed Proxy Card today.
Page 22
YOUR VOTE IS IMPORTANT TO THE COMPANY WHETHER YOU OWN FEW OR MANY
SHARES! Please complete, date and sign the attached proxy card and
return it in the accompanying postage paid envelope, even if you plan
to attend the Annual Meeting. If you attend the Annual Meeting, you
may, if you wish, withdraw your proxy and vote in person.
REALTY INCOME CORPORATION
ANNUAL MEETING OF STOCKHOLDERS - MAY 3, 2000
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned stockholder of Realty Income Corporation, a
Maryland corporation (the "Company") hereby appoints Michael R.
Pfeiffer as proxy for the undersigned, with full power of
substitution, to attend the Annual Meeting of the Stockholders of the
Company to be held at the California Center for the Arts, 340 North
Escondido Boulevard, Escondido, California, 92025, on May 3, 2000 at
9:00 a.m. Local Time, and any adjournment or postponement thereof, to
cast on behalf of the undersigned all votes that the undersigned is
entitled to cast at such meeting and otherwise to represent the
undersigned at the meeting with all powers possessed by the
undersigned if personally present at the meeting. The undersigned
hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders and of the accompanying Proxy Statement and revokes any
proxy heretofore given with respect to such meeting.
The votes entitled to be cast by the undersigned will be cast as
instructed on the back of this card. If this proxy is executed but no
instruction is given, the votes entitled to be cast by the undersigned
will be cast "FOR" the following proposals.
All other proxies heretofore given by the undersigned to vote shares
of stock of the Company, which the undersigned would be entitled to
vote if personally present at the Annual Meeting or any adjournment or
postponement thereof, are hereby expressly revoked.
(Continued, and to be dated and signed on reverse side.)
Realty Income Corporation
P.O. Box 11104
New York, N.Y. 10203-0104
Page 23
<PAGE>
YOUR VOTE IS IMPORTANT TO THE COMPANY WHETHER YOU OWN FEW OR MANY
SHARES! Please complete, date and sign the attached proxy card and
return it in the accompanying postage paid envelope, even if you plan
to attend the Annual Meeting. If you attend the Annual Meeting, you
may, if you wish, withdraw your proxy and vote in person.
The Board of Directors recommends a vote FOR Election of Directors.
Proposal 1. Election of Directors
FOR all nominees WITHHOLD AUTHORITY to vote
listed below [ ] for all nominees listed below [ ]
Nominees: Kathleen R. Allen, William E. Clark and Thomas A. Lewis
(INSTRUCTIONS: To withhold authority to vote for any individual
nominee, strike through that nominee's name above.)
Proposal 2. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the
Annual Meeting or any adjournment or postponement
thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS
GIVEN, THIS PROXY WILL BE VOTED "FOR" PROPOSAL 1.
Change of Address and or Comments Mark Here [ ]
Please date this proxy and sign it exactly as your name or names
appear. When shares are held jointly, each holder should sign. When
signing as an attorney, executor, administrator, trustee or guardian,
please give full title as such. If shares are held by a corporation,
please sign in full corporate name by the president or other
authorized officer. If shares are held by a partnership, please sign
in partnership name by an authorized person.
Dated: , 2000
Signature(s)
-----------------------------------------------
Votes MUST be indicated (x) in Black or Blue ink. [X]
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THE PROXY CARD USING THE
ENCLOSED ENVELOPE. IF YOUR ADDRESS IS INCORRECTLY SHOWN, PLEASE PRINT
CHANGES.
Page 24
