SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
FIRST AMERICAN HEALTH CONCEPTS, INC.
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(Name of Registrant as Specified In Its Charter)
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(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)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
FIRST AMERICAN HEALTH CONCEPTS, INC.
7776 S. POINTE PARKWAY WEST, SUITE 150
PHOENIX, ARIZONA 85044-5424
--------------------------------------------------------
NOTICE OF MEETING AND PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 24, 2001
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To Our Shareholders:
The Annual Meeting of Shareholders of FIRST AMERICAN HEALTH CONCEPTS, INC.
(the "Company") will be held at Another Pointe in Tyme Restaurant at The Pointe
South Mountain Resort, 7777 S. Pointe Parkway, Phoenix, Arizona 85044 on
Wednesday, January 24, 2001 at 2:00 P.M., Arizona time, for the following
purposes:
1. To vote with respect to adopting a proposed amendment to Article X of
the Company's Articles of Incorporation to allow from three (3) to
seven (7) directors rather than requiring five (5) to seven (7)
directors.
2. To elect directors.
3. To ratify the Board of Directors" recommendation that Pannell Kerr
Forster of Texas, P.C. be appointed the Company's independent public
accountants for fiscal year 2001.
4. To transact such other business as may properly come before the
meeting. Management is presently aware of no other business to come
before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 3.
The Board of Directors has fixed the close of business on November 22, 2000
as the record date for the determination of shareholders entitled to receive
notice of and to vote at the meeting or any adjournment thereof and only holders
of record of issued and outstanding shares of the Company's Common Stock at that
time will be entitled to such notice or so to vote.
Management of the Company cordially invites you to attend the meeting.
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND PERSONALLY ARE REQUESTED TO SIGN AND
DATE THE ACCOMPANYING PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED POSTAGE
PREPAID ENVELOPE.
Details of the matters to be acted on by the shareholders are set forth in
the following Proxy Statement, which is hereby incorporated as a part of this
Notice of Meeting.
By Order of the Board of Directors
John R. Behrmann
Chairman of the Board
MAILED TO SHAREHOLDERS ON OR ABOUT JANUARY 3, 2001
<PAGE>
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of FIRST AMERICAN HEALTH CONCEPTS, INC. (the
"Company") to be used at the Annual Meeting of Shareholders which will be held
on January 24, 2001, and at any adjournment thereof with respect to the matters
referred to in the preceding Notice of Meeting. The Company's 2000 Annual
Report, containing financial statements reflecting the financial position and
results of operations of the Company for the fiscal year ended July 31, 2000,
and this Proxy Statement and the preceding Notice of Meeting are being mailed on
or about January 3, 2001, to shareholders of record at the close of business on
November 22, 2000. As of the record date, there were 2,604,736 shares of the
Company's Common Stock outstanding. Shareholders of record are entitled to one
vote for each share held of record on each matter of business to be considered
at the meeting other than the election of directors. See "Cumulative Voting
Rights" under Proposal 2 for information on voting with respect to the election
of directors.
VOTING; PROXIES; REVOCATION OF PROXIES
A shareholder desiring to vote at the Annual Meeting may do so by (i)
attending the meeting and voting in person; (ii) signing and dating the proxy
which accompanies this Notice of Meeting and Proxy Statement and returning it to
the Company; or (iii) duly executing and giving a proxy to a person of the
shareholder's choosing. Any proxy so given may be revoked by the person giving
it at any time before its use by delivering to the Company a written notice of
revocation or a duly executed proxy bearing a later date or by attending the
meeting and voting in person.
In determining whether a quorum exists at the meeting all shares
represented in person or proxy will be counted. Presence of holders of a
majority of the outstanding stock entitled to vote shall constitute a quorum.
Votes will be tabulated by inspectors. Abstentions and broker non-votes are each
included in the determination of the number of shares present and voting. Each
is tabulated separately. Abstentions are counted in tabulations of the votes
cast on proposals presented to shareholders, whereas broker non-votes are not
counted for purposes of determining whether a proposal has been approved.
Adoption of Proposals 1 and 3 will require the affirmative vote of a
majority of the shares of the Company's Common Stock present and entitled to
vote at the Annual Meeting, assuming a quorum is present. For information with
respect to election of directors, see "Proposal 2 - Cumulative Voting Rights."
2001 PROXY STATEMENT PROPOSALS
Each year the Board of Directors submits to the shareholders at the Annual
Meeting its nominations for election of directors. Other proposals may be
submitted by the Board of Directors or shareholders for inclusion in the Proxy
Statement for action at the Annual Meeting. Any proposal submitted by a
shareholder for inclusion in the 2001 Annual Meeting Proxy Statement must be
received by the Company not later than June 30, 2001.
1
<PAGE>
PROPOSAL 1
AMENDMENT TO ARTICLE X OF THE ARTICLES OF INCORPORATION
At the meeting, the Company will seek shareholder adoption of an amendment
to Article X of the Articles of Incorporation. A copy of the proposed Article X
as to be amended is set forth in Exhibit 1. The amendment is proposed to give
the Board flexibility to add Board members when it is determined to be in the
best interest of the Company and its shareholders.
PROPOSAL 2
ELECTION OF DIRECTORS
CUMULATIVE VOTING RIGHTS
Each shareholder present either in person or by proxy at the Annual Meeting
will have cumulative voting rights with respect to the election of directors;
that is the shareholder will have an aggregate number of votes in the election
of directors equal to the number of directors to be elected multiplied by the
number of shares of Common Stock of the Company held by such shareholder on the
record date. The resulting aggregate number of votes may be cast by the
shareholder for the election of any single nominee or the shareholder may
distribute such votes among any number of all of the nominees. The five nominees
receiving the highest number of votes will be elected to the Board of Directors.
The cumulative voting rights may be exercised in person or by proxy and there
are no conditions precedent to the exercise of such rights. The form of proxy
which accompanies this Notice of Meeting and Proxy Statement confers
discretionary authority on the proxyholders to vote the shares represented
thereby cumulatively in certain cases described immediately below under
"Nominees."
NOMINEES
A board of five directors is to be elected at the Annual Meeting. Unless
otherwise instructed in any proxy, the persons named in the form of proxy which
accompanies this Notice of Meeting and Proxy Statement (the "proxyholders") will
vote the proxies received by them for the Company's five nominees whose names
are set forth in the following table, four of whom are presently directors of
the Company and one who has been nominated by the Board of Directors. In the
event that any such nominee is unable or declines to serve as a director at the
time of the Annual Meeting, the proxies will be voted for any nominee who shall
be designated by the present Board of Directors to fill the vacancy. In the
event that additional persons are nominated for election as directors, the
proxyholders intend, unless otherwise instructed in any proxy, to vote all
proxies received by them in such manner in accordance with cumulative voting as
will assure the election of as many of the following nominees as possible, and,
in such event, the specific nominees to be voted for will be determined by the
proxyholders. In the event that authority to vote for any nominee whose name is
set forth in the following table is withheld in any proxy, the proxyholders
intend, unless otherwise instructed in such proxy, to vote the shares
represented by such proxy, in their discretion, cumulatively for one or more of
the other nominees named in such table. The Company is not aware of any nominee
who will be unable or will decline to serve as a director. The term of office of
each person elected as a director will expire upon the election and
qualification of his or her successor, expected to be at the next Annual Meeting
of Shareholders.
2
<PAGE>
The names of the nominees, their ages, position(s) with the Company, and
periods during which they have held such positions are as follows:
Name and Year
First Held Position Age Position(s)
------------------- --- -----------
John R. Behrmann 65 Director (1)
(1993)
Robert J. Delsol 51 Director (1)
(1993)
James D. Hyman 55 Nominee for Director,
(Nominee) President and CEO
Thomas B. Morgan 75 Director (1)
(1988)
Robert M. Topol 75 Director (1)
(1989)
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(1) A member of the Executive Committee, which Committee has all powers of the
entire Board of Directors other than powers denied by law or by resolution
of the entire Board of Directors.
INFORMATION CONCERNING NOMINEES
Information furnished to the Company by such persons, with respect to the
business experience of the above nominees for election as directors of the
Company, is set forth below.
JOHN R. BEHRMANN has been a director since November 1993 and Chairman since
January 1997. Mr. Behrmann is Chairman of the Board of Redstone Resources, Inc.,
a company engaged in natural gas exploration. Mr. Behrmann is also Chairman and
President of Behrwood Capital Services, Inc., an investment management company;
and Evergreen Industries, Inc., a commercial deer farm; and a director of The
North American Deer Farmers Association. Mr. Behrmann, a CPA, holds a B.S.
degree in Commerce and Finance from Bucknell University, Lewisburg,
Pennsylvania.
ROBERT J. DELSOL has been a director of the Company since June 1993. Mr.
Delsol is a graduate of California State University, Hayward, with a B.A. degree
in accounting. He received his CPA certificate in 1972. He currently serves as
President and Chief Executive Officer of Pacific Steel Casting Company;
President, Tri-Pacific, Inc., a personal holding company; President, Alpha
Capital Company, which he co-founded in 1977; and Executive Vice President,
Caron Compactor Company.
JAMES D. HYMAN has been with the Company since May 1997 serving as Vice
President of Sales and Marketing until being promoted to President and CEO on
April 1, 2000. Prior to joining the Company, Mr. Hyman was associated with
Physicians Eyecare Network and Davis Vision, Inc. for more than ten years. He
holds a B.A. degree in Political Science from Holy Cross College, Worcester,
Massachusetts.
THOMAS B. MORGAN has been a director of the Company since October 1988. Mr.
Morgan is currently the President of Citizen Auto Stage Co. and Gray Line Tours,
Inc., bus and trucking companies operating in Phoenix and southern Arizona and
is a member of the Board of Directors of Redstone Resources, Inc. He is also
Past Chairman of Holy Cross Hospital, Nogales, Arizona, and Gray Line Worldwide,
Denver, Colorado, and an Honorary Lifetime Member of the Board of Directors of
American Bus Association, Washington, D.C.
3
<PAGE>
ROBERT M. TOPOL has been a director of the Company since November 1989. In
June 1994, Mr. Topol retired from Smith Barney Shearson, Inc. after serving as
Executive Vice President since 1976, and Director of Unit Trusts since 1980. Mr.
Topol serves as Director of E-Z-EM, Inc., a medical products company in
Westbury, New York and is a member of the Board of Directors of the American
Health Foundation, City Meals and Wheels, Purchase College, and Redstone
Resources, Inc.
The Company maintains a standing Audit Committee currently comprised of
John R. Behrmann, Robert J. Delsol, and Robert M. Topol. The Audit Committee met
two times during fiscal 2000. The basic function of the Audit Committee is to
provide assistance to the corporate directors in fulfilling their responsibility
to the shareholders, potential shareholders, and investment community relating
to corporate accounting, reporting practices of the corporation, and the quality
and integrity of the financial reports of the corporation.
The Board of Directors maintains both a Nominating Committee and
Compensation and Options Committee currently comprised of John R. Behrmann,
Robert J. Delsol, Thomas B. Morgan, and Robert M. Topol.
During the fiscal year ended July 31, 2000, the Board of Directors met on
six occasions. During the last fiscal year, no incumbent director, during the
period that he was a director, attended fewer than 75% of the aggregate of (i)
the total number of meetings of the Board of Directors and (ii) the total number
of meetings held by all committees of the Board on which he served.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
During the fiscal year ended July 31, 2000, three Form 4's, one each for
Margaret Eardley, James D. Hyman, and Robert M. Topol were not filed on a timely
basis. Each Form 4 reflected one transaction.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS. As of November 22,
2000, the following persons were known by the Company to be the beneficial
owners of more than 5% of the Company's Common Stock:
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class (1)
-------------- ---------------- -------------------- ---------
<S> <C> <C> <C>
No par value John R. Behrmann, Chairman of the Board 169,883 6.5%
common 105 Leader Heights Road, Ste. #140 (2)(4)
York, PA 17403
No par value Robert J. Delsol, Director 795,634 30.5%
common 1425 E. Leimert Blvd., Ste. #400 (2)(5)(6)
Oakland, CA 94602
</TABLE>
4
<PAGE>
(b) SECURITY OWNERSHIP OF MANAGEMENT. The stock beneficially owned by
all directors, nominees, and executive officers of the Company as of November
22, 2000, is set forth below:
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class (1)
-------------- ---------------- -------------------- ---------
<S> <C> <C> <C>
No par value John R. Behrmann, Chairman of the Board 169,883 6.5%
common 105 Leader Heights Road, Ste. #140 (2)(4)
York, PA 17403
No par value Robert J. Delsol, Director 795,634 30.5%
common 1425 E. Leimert Blvd., Ste. #400 (2)(5)(6)
Oakland, CA 94602
No par value James D. Hyman, Nominee for Director, 2,131 .1%
common President and CEO (3)
First American Health Concepts, Inc.
7776 S. Pointe Parkway West, Suite 150
Phoenix, AZ 85044
No par value Thomas B. Morgan, Director 114,510 4.4%
common 67 East Baffert Drive (2)(7)
Nogales, AZ 85621
No par value Robert M. Topol, Director 100,003 3.8%
common 825 Orienta Avenue (2)(8)
Mamaroneck, NY 10543
Officers, directors and nominees 1,132,161 43.5%
as a group (8 persons) (9)(10)
</TABLE>
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(1) A person is deemed to be the beneficial owner of securities that can be
acquired within 60 days from November 22, 2000 through the exercise of any
option, warrant or right. Shares of Common Stock subject to options,
warrants or rights which are currently exercisable or exercisable within 60
days are deemed outstanding for computing the percentage of the person
holding such options, warrants or rights, but are not deemed outstanding
for computing the percentage of any other person. The amounts and
percentages are based upon 2,604,736 shares of Common Stock outstanding as
of July 31, 2000.
(2) A Director.
(3) A Nominee for Director.
(4) Includes 30,000 shares which may be acquired within 60 days of the record
date upon exercise of stock options.
(5) Includes 20,000 shares which may be acquired within 60 days of the record
date upon exercise of stock options.
(6) Includes 395,722 shares owned by Pacific Steel Casting, a corporation of
which Mr. Delsol is President and a major shareholder; with shared voting
and investment power; 163,086 shares owned by Pacific Steel Casting Pension
Plan and 135,054 by Pacific Steel Casting Profit Sharing Plan, of which Mr.
Delsol is a trustee with shared voting and investment power; 23,257 shares
owned by Piece of the Pebble, L.P., of which Mr. Delsol as the general
partner has sole voting and investment power; 12,000 shares owned by
Tri-Pacific, Inc., a personal holding company of which Mr. Delsol as
President has sole voting and investment power; and 46,515 shares owned by
Alpha Capital Company, Inc., a corporation in which Mr. Delsol as an owner,
officer, and director, has shared voting and investment power.
(7) Includes 15,000 shares owned by spouse. Mr. Morgan has no voting or
investment power with regard to these shares.
(8) Includes 36,001 shares owned by spouse. Mr. Topol has no voting or
investment power with regard to these shares.
(9) Includes shares held by officers, directors, nominees, and owners of 5% or
more, as community property, in joint tenancy with spouses or having other
shared voting rights.
(10) Includes an additional 15,474 exercisable options held by officers for a
total of 65,474 shares which may be acquired within 60 days of the record
date upon exercise of stock options.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth compensation paid or accrued to each
person who was an executive officer of the Company at any time during the fiscal
year ended July 31, 2000 whose cash compensation from the Company for services
in all capacities during such fiscal year exceeded $100,000.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
Other
Name and Annual
Principal Compen- Options/
Position Year Salary Bonus sation SARs
-------- ---- ------ ----- ------ ----
James D. Hyman 2000 $137,654 $ 0* 0 20,000
President/CEO 1999 110,000 15,229 0 0
1998 110,000 6,558 0 10,000
John A. Raycraft 2000 $199,480(1) $ 0 $1,999(2) 0
Former President/CEO 1999 167,500 26,248 1,999(2) 0
1998 159,800 28,144 1,999(2) 0
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* Estimate
(1) Includes $63,750 severence pay.
(2) Life insurance policy with spouse as beneficiary.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
Percent of Total
Options/SARS
Options/ Granted to
SARS Employees in Exercise or Expiration
Name Granted Fiscal Year Base Price Date
---- ------- ----------- ---------- ----
James D. Hyman 20,000 36.4% $3.75 08/08/2004
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Value of
Number of Unexercised
Unexercised In-the-money
Options/SARS Options/SARS
at FY-End at FY-End
Shares Acquired Exercisable/ Exercisable/
Name on Exercise Value Realized Unexercisable Unexercisable
---- ----------- -------------- ------------- -------------
None
6
<PAGE>
DIRECTORS' COMPENSATION
Directors who are not employees receive $500 per meeting of the Board of
Directors attended and an additional $200 per meeting for attending any
committee meeting of the Board of Directors of which they are a member.
No nonstatutory options of the Company's Common Stock were granted to
directors during the fiscal year ended July 31, 2000. Nonstatutory options for
10,000 shares of the Company's Common Stock were granted to one director during
the fiscal year ended July 31, 1998, at $3.3125 per share. Nonstatutory options
for 20,000 shares each of the Company"s Common Stock were granted to directors
as follows: One during fiscal year ended July 31, 1994 at $8.00 per share; one
during the fiscal year ended July 31, 1993, at $4.625 per share; one during the
fiscal year ended July 31, 1990, at $2.1875 per share, and one during the fiscal
year ended July 31, 1989, at $1.6256 per share.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During 1993, the Company made a $101,395 loan to John A. Raycraft,
President and Chief Executive Officer of the Company, in exchange for an
interest bearing note receivable. The agreement provided for quarterly loan
payments amounting to 50% of the profit sharing payment due to the officer, with
payments applied first to accumulated interest due and then to principal, until
paid in full. The note was secured by an insurance policy on the life of the
officer. The balance of the note on August 1, 1994 was $65,525. In fiscal 1995,
the Company loaned the officer an additional $28,000 and agreed to repayment of
principal and interest in five annual installments through August 1, 1999. Other
terms of the note receivable remained unchanged. The balance of the note on July
31, 1999 was $28,304.56. During August 1999 the loan was paid in full.
Former President and Chief Executive Officer, John A. Raycraft, was
terminated effective March 15, 2000. FAHC continued to pay his salary of
$170,000 on a semi-monthly basis through December 6, 2000. In addition FAHC
continued to provide health coverage for Mr. Raycraft and a $250,000 life
insurance policy, naming his spouse as beneficiary, for which the annual premium
was $1,999. All salary and benefits ended December 6, 2000. All stock options
previously granted to Mr. Raycraft also terminated on December 6, 2000.
Additionally, Mr. Raycraft is fully vested in 9,846 shares through the Company's
Employee Stock Ownership Plan.
PROPOSAL 3
SELECTION OF AUDITORS
The Board of Directors will seek shareholder ratification of its
selection of Pannell Kerr Forster of Texas, P.C. as the Company"s independent
public accountants for fiscal year 2001. If the shareholders do not ratify the
selection of Pannell Kerr Forster of Texas, P.C., another firm of certified
public accountants will be selected as the Company"s independent auditors by the
Board of Directors.
Representatives of Pannell Kerr Forster of Texas, P.C. will be present at
the Annual Meeting, will have an opportunity to make a statement, and will be
available to respond to appropriate questions.
The Board of Directors recommends a vote FOR Proposal 3.
7
<PAGE>
GENERAL
As of the date of this Proxy Statement, the Board of Directors knows of
no other matter which will come before the meeting. In the event that any other
matter legally comes before the meeting, the persons named in the accompanying
form of Proxy intend to vote all proxies in accordance with their judgment on
such matters.
Shares represented at the Annual Meeting by properly executed and dated
proxies in the accompanying form will be voted and, where the shareholder
specifies by means of the ballot set forth in the form of Proxy a choice with
respect to any matter to be acted upon, the shares will be voted in accordance
with the specifications so made. In the absence of any specification with
respect to Proposals 1 and 3, proxies will be voted FOR such Proposals.
The cost of soliciting proxies relating to the Annual Meeting will be
borne by the Company. Directors, officers and regular employees of the Company
may solicit proxies from the larger shareholders, which solicitation may be made
by telephone, telegram or personal interview. In addition, the Company will,
upon the request of brokers, dealers, voting trustees and banks and other
entities that exercise fiduciary powers, and their nominees, who are holders of
record of shares of the Company's Common Stock on the record date referred to
above, pay their reasonable expenses for completing the mailing of copies of
this Notice of Meeting and Proxy Statement, of the enclosed form of Proxy, and
of the Company's 2000 Annual Report to the beneficial owners of such shares of
Common Stock.
FIRST AMERICAN HEALTH CONCEPTS, INC.
John R. Behrmann
Chairman of the Board
January 3, 2001
8
<PAGE>
EXHIBIT 1
Proposed Article X of the Articles of Incorporation as to be amended
ARTICLE X
The Board of Directors shall be composed of a minimum of three (3) and a
maximum of seven (7) directors. The Board, as provided in the Bylaws, shall from
time-to-time determine the number of directors within the above minimum and
maximum.
9
<PAGE>
FRONT OF CARD
FIRST AMERICAN HEALTH CONCEPTS, INC.
7776 S. Pointe Parkway West, Suite 150, Phoenix, Arizona 85044-5424
ANNUAL MEETING OF SHAREHOLDERS -- JANUARY 24, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints James D. Hyman and Carolyn Hall and each or
either of them (with full power of substitution) to vote and represent all
shares of Common Stock registered in the name of the undersigned of record at
the close of business on November 22, 2000, at the Annual Meeting of
Shareholders of FIRST AMERICAN HEALTH CONCEPTS, INC. (the "Company") to be held
at Another Pointe in Tyme Restaurant at The Pointe South Mountain Resort, 7777
S. Pointe Parkway, Phoenix, Arizona, on January 24, 2001, at 2:00 P.M., Arizona
Time, and at any adjournment. Without otherwise limiting the generality of the
foregoing, said proxies are directed to vote as follows:
(The Proxy continues and must be signed on the reverse side.)
<PAGE>
Please mark your votes as in this example [X]
BACK OF CARD
(Continued from other side)
1. ELECTION OF [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to
DIRECTORS (except as withheld in the vote for all of the
space provided below) nominees listed below
NOMINEES:
John R. Behrmann, Robert J. Delsol, James D. Hyman, Thomas B. Morgan,
Robert M. Topol.
(INSTRUCTION: To withhold authority to vote for any nominee, write that
nominee's name on the following line.)s
________________________________________________________________________________
2. To vote with respect to adopting a proposed [ ] FOR [ ] AGAINST [ ] ABSTAIN
amendment to Article X of the Company's
Articles of Incorporation to allow from three
(3) to seven (7) directors rather than
requiring five (5) to seven (7) directors.
3. To ratify the Board of Directors' [ ] FOR [ ] AGAINST [ ] ABSTAIN
recommendation that Pannell Kerr Forster of
Texas, P.C. be appointed the Company's
independent public accountants for fiscal
year 2001.
This proxy also grants to the proxyholders the discretionary power to vote the
proxy for a substitute nominee in the event any nominee becomes unavailable, to
vote the shares cumulatively for one or more, but less than all of the nominees
named at left if additional persons are nominated for election as directors and
to vote such shares cumulatively for one or more of the nominees named at left
other than those (if any) for whom authority to vote is withheld.
This proxy when properly executed will be voted as specified above, but if no
specification is made, it will be voted FOR the proposals listed above. The
proxyholders are also authorized to vote in their discretion upon such other
business as may properly come before the meeting or any adjournment thereof
(unless this sentence is stricken).
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
------------------------- --------------------------------- ------------
Signature Signature if held jointly Dated
This proxy must be signed exactly as name appears. When shares are held by joint
tenants, both should sign. When signing as attorney or as trustee, executor or
guardian, please give full title as such. If a corporation, please sign in full
corporate name by President or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
