<PAGE>
<PAGE>
________________________________________________________________________________
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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 Commission Only (as permitted by Rule
14a-6(e)(2)
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
BHA GROUP HOLDINGS, INC.
--------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
--------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[x] 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:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement no.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
________________________________________________________________________________
<PAGE>
<PAGE>
BHA GROUP HOLDINGS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TUESDAY, FEBRUARY 23, 1999
To the Stockholders of
BHA GROUP HOLDINGS, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of BHA Group
Holdings, Inc. (the 'Company') will be held at the office of the Company, Second
(2nd) Floor, BHA Group Holdings, Inc. Corporate Headquarters, 8800 East 63rd
Street, Kansas City, Missouri 64133, on Tuesday, February 23, 1999, at 10:30
a.m., Kansas City time, for the following purposes:
1. To elect directors for the ensuing year;
2. To ratify the selection of KPMG Peat Marwick LLP as independent
auditors of the Company for the fiscal year ending September 30,
1999; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on January 5, 1999 has been designated as the record
date for the determination of stockholders entitled to notice of and to vote at
the Annual Meeting of Stockholders or any adjournments thereof.
MANAGEMENT REQUESTS ALL STOCKHOLDERS TO SIGN AND DATE THE ENCLOSED FORM OF
PROXY AND RETURN IT IN THE POSTAGE PAID, SELF-ADDRESSED ENVELOPE PROVIDED FOR
YOUR CONVENIENCE. PLEASE DO THIS WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL
MEETING OF STOCKHOLDERS. SHOULD YOU ATTEND, YOU MAY, IF YOU WISH, WITHDRAW YOUR
PROXY AND VOTE YOUR SHARES IN PERSON.
By Order of the Board of Directors
James C. Shay
Secretary
Kansas City, Missouri
January 14, 1999
<PAGE>
<PAGE>
BHA GROUP HOLDINGS, INC.
----------------------------------
PROXY STATEMENT
----------------------------------
DATED JANUARY 14, 1999
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD TUESDAY, FEBRUARY 23, 1999
This Proxy Statement is furnished by the Board of Directors (the 'Board')
of BHA Group Holdings, Inc. (the 'Company') in connection with the solicitation
of proxies to be voted at the Annual Meeting of Stockholders of the Company
which will be held at the principal executive offices of the Company, Second
(2nd) Floor, BHA Group Holdings, Inc. Corporate Headquarters, 8800 East 63rd
Street, Kansas City, Missouri 64133, on Tuesday, February 23, 1999 at 10:30
a.m., Kansas City time, and all adjournments thereof (the 'Annual Meeting'). The
close of business on January 5, 1999 has been designated as the record date (the
'Record Date') for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting.
Any proxy delivered pursuant to this solicitation may be revoked, at the
option of the person executing the proxy, at any time before it is exercised,
either by delivering a signed revocation to the Secretary of the Company at any
time prior to the Annual Meeting, or, at the Annual Meeting, by delivering a
signed revocation to the Chairman of the meeting at any time prior to the
commencement of the voting thereon. A duly executed proxy conferring different
authority than an earlier proxy of the same stockholder will constitute a
revocation of such earlier proxy.
UNLESS OTHERWISE SPECIFIED IN THE PROXY (AND EXCEPT FOR 'BROKER NON-VOTES'
DESCRIBED BELOW), STOCK REPRESENTED BY PROXIES WILL BE VOTED (I) FOR THE
ELECTION OF MANAGEMENT'S NOMINEES FOR DIRECTORS; (II) FOR THE RATIFICATION OF
THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITORS OF THE COMPANY
FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 1999 ('FISCAL 1999'); AND (III) IN THE
DISCRETION OF THE PROXYHOLDERS WITH RESPECT TO SUCH MATTERS AS MAY COME BEFORE
THE ANNUAL MEETING.
The cost of soliciting proxies will be borne by the Company. In addition to
the use of the mails, proxies may be solicited personally or by telephone by
some of the regular employees of the Company. The Company does not expect to pay
any compensation for the solicitation of proxies, but may reimburse brokers and
other persons holding stock in their names, or in the names of nominees, for
their expense incurred in sending proxy materials to their principals and
obtaining their proxies. On or about January 14, 1999, this Proxy Statement and
the accompanying form of proxy are to be mailed to each stockholder of record as
of the Record Date.
As of December 31, 1998, the Company had outstanding 7,106,478 shares of
the Company's $.01 par value common stock (the 'Common Stock'), the Company's
only class of voting securities outstanding. Each share of Common Stock
outstanding entitles the holder thereof to one vote. The majority of all the
outstanding shares of Common Stock constitutes a quorum at the Annual Meeting.
Shares of Common Stock represented by proxies that reflect abstentions and
'broker non-votes' (i.e. Common Stock represented at the Annual Meeting by
proxies held by brokers or nominees as to which (i) instructions have not been
received from the beneficial owners or persons entitled to vote and (ii) the
broker or nominee does not have the discretionary voting power on a particular
matter) will be counted as a vote represented and voted at the Annual Meeting
for purposes of determining the number of votes required to approve a proposal.
Shares of Common Stock represented by proxies that withhold authority to vote
for a nominee for election as a director and broker non-votes will not be
counted as a vote represented and voted at the Annual Meeting for purposes of
determining the number of votes required to elect such nominee.
<PAGE>
<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
NOMINEES FOR ELECTION OF DIRECTORS
Eight directors are to be elected at the Annual Meeting, each to hold
office until the next annual meeting of stockholders and until his successor is
duly elected and qualified. In voting for directors, for each share of Common
Stock held of record, such stockholder is entitled to cast one vote either in
favor of or against each candidate, or to abstain from voting on any or all
candidates. It is intended that shares represented by the enclosed form of proxy
will be voted in favor of the election of all of the nominees named below as
directors, all of whom are now directors of the Company, unless otherwise
specified in such proxy. If any of the nominees should become unavailable for
election, the shares represented by such proxies will be voted for such
substitute nominees as may be nominated by the Board. The election of directors
requires the affirmative vote of the holders of a plurality of the shares
present or represented and entitled to vote at the Annual Meeting.
The following information is given with respect to the nominees:
<TABLE>
<CAPTION>
DIRECTOR
NAME PRINCIPAL OCCUPATION SINCE
- ------------------------------ ------------------------------------------------------------- --------
<S> <C> <C>
Lamson Rheinfrank, Jr. ....... Chairman of the Board of the Company(1) 1986
Michael T. Zak................ Vice Chairman of the Board of the Company(2) 1986
James E. Lund................. Chief Executive Officer and President of the Company(3) 1986
James J. Thome................ Chief Operating Officer and Executive Vice President of the 1990
Company(4)
Don H. Alexander.............. President and Chief Executive Officer of Alexander & 1986
Associates, Inc.(5)
Robert D. Freeland............ Chairman of the Board of Havens Steel Company(6) 1988
Thomas A. McDonnell........... President and Chief Executive Officer of DST Systems, Inc.(7) 1993
Richard C. Green.............. Chairman and Chief Executive Officer of UtiliCorp United, 1995
Inc.(8)
</TABLE>
- ------------
(1) Mr. Rheinfrank, age 58, has been Chairman of the Board of the Company since
its inception in July 1986. He was the Chief Executive Officer and Chairman
of the Board of Directors of Standard Havens, Inc. ('Standard Havens') from
1967 until May 1989 when Standard Havens, which had been an affiliate of the
Company, was acquired by a subsidiary of Raytheon Company. Mr. Rheinfrank
also serves as the non-executive Chairman of the Board of Celotex
Corporation, a Director of Commerce Bank of Kansas City and an advisory
director of Havens Steel Company and U.S. Engineering Co.
(2) Mr. Zak, age 48, has been a Director of the Company since its inception in
July 1986. He has been Vice Chairman of the Company since April 1993 and
served as President and Chief Executive Officer from July 1986 to March
1993. From 1980 to July 1986, he was employed by Standard Havens in various
capacities, first as Controller of the Baghouse Accessories Division and
then as Vice President and Treasurer.
(3) Mr. Lund, age 49, has been a Director of the Company since its inception in
July 1986. He has been President and Chief Executive Officer of the Company
since April 1993 and prior thereto, served as Executive Vice President. Mr.
Lund joined Standard Havens in 1979 as Marketing Manager of the Baghouse
Accessories Division, and served as Manager of Sales and Marketing from 1980
to 1985, at which time he assumed the position of Vice President and General
Manager of the Baghouse Accessories Division of Standard Havens.
(4) Mr. Thome, age 43, has been Chief Operating Officer of the Company since May
1997 and Executive Vice President of the Company since April 1993. He has
been a Director of the Company
(footnotes continued on next page)
2
<PAGE>
<PAGE>
(footnotes continued from previous page)
since February 1990. He joined the Company in 1986 as National Sales Manager
and became Vice President of the Company in November 1988. Prior to his
employment with the Company, Mr. Thome served in various positions with
Standard Havens from 1979 to 1986.
(5) Mr. Alexander, age 60, has been a Director of the Company since its
inception in July 1986. Mr. Alexander is President and Chief Executive
Officer of Alexander & Associates, Inc., a private investment group;
Chairman of EMCO Specialty Products, Inc, a manufacturing company of hat and
coat racks; Chairman of Huebert Fiberboard Company of Booneville, MO, a
manufacturing company of fiberboard; Chairman of Ventaire Corporation, a
Tulsa-based metal fabrication company; and a Director of the Bank of Blue
Valley, a commercial banking company in Overland Park, Kansas. Prior to 1988
he was President of Perkins Industries, Inc. of Lenexa, Kansas, a
manufacturer of adhesives and resins.
(6) Mr. Freeland, age 61, has been a Director of the Company since November
1988. He is Chairman of the Board of Havens Steel Company of Kansas City,
Missouri, a global steel construction company. From 1983 to 1993, he was
President and Chief Executive Officer and has been a Director of Havens
Steel Company since 1971. Mr. Freeland is a past President and Board Member
of the Central Fabricators Association of Chicago, Illinois, and is the
current Chairman of the Board of Directors of the American Institute of
Steel Construction of Chicago, Illinois.
(7) Mr. McDonnell, age 53, has been a Director of the Company since December
1993. Mr. McDonnell is the President and Chief Executive Officer and a
Director of DST Systems, Inc. ('DST'), a company providing information
processing and computer software services primarily to mutual funds and
financial service organizations. He has been employed by DST in various
capacities since 1973. He is a Director of Informix Software, Inc., Cerner
Corporation, Euronet Services, Inc., and Computer Sciences Corporation.
(8) Mr. Green, age 44, has been a Director of the Company since November 1995.
Mr. Green is Chairman of the Board of Directors and Chief Executive Officer
of UtiliCorp United, Inc. ('UtiliCorp United'), a global energy company. His
association with UtiliCorp United began in 1976 with assignments in a
variety of operating and staff positions involving plant supervision, legal,
finance and treasury functions. He was appointed Chief Executive Officer of
UtiliCorp United in 1985 and Chairman of the Board of Directors of UtiliCorp
United in 1989. He is a Trustee of the Urban Institute in Washington, DC; a
member of the boards of directors of the Midwest Research Institute; and
Vice Chairman of the Greater Kansas City Community Foundation and affiliated
trusts.
COMMITTEES AND MEETINGS OF THE BOARD
During the Company's fiscal year ended September 30, 1998 ('Fiscal 1998'),
the Board held four regular meetings and one special meeting. The Board has an
Audit Committee and a Compensation Committee, but does not have a Nominating
Committee.
The Audit Committee consists of Messrs. Alexander, Freeland, McDonnell and
Green. During Fiscal 1998, the Audit Committee met two times. The Audit
Committee reviews and reports to the Board with respect to various auditing and
accounting matters, including the nomination of the Company's independent public
accountants, the scope of audit procedures, general accounting policy matters,
the Company's internal audit function, and the performance of the Company's
independent public accountants.
During Fiscal 1998, the Compensation Committee, comprised of Messrs.
Alexander, Freeland, McDonnell and Green, met twice. The Compensation Committee
is responsible for the review and approval of the annual corporate compensation
guidelines, management bonuses, executive officer compensation, and the
potential levels of contribution to or awards under the Company's Employee Stock
Option Plan ('ESOP'), 401(k) plan and Incentive Stock Option Plan (the 'Plan')
for the ensuing year.
3
<PAGE>
<PAGE>
During Fiscal 1998, all of the directors attended at least 75% of the
meetings of the Board and committees of which they are members.
DIRECTORS' COMPENSATION
Currently, each director who is not employed by the Company receives an
annual retainer of $14,000 plus $1,000 for each meeting of the Board or any
committee he attends, which, upon election, can be paid in the form of Common
Stock. All eligible directors elected to receive Common Stock for all
compensation earned in Fiscal 1998.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
To the Company's knowledge, all officers, directors and beneficial owners
of more than 10% of Common Stock of the Company filed timely reports under
Section 16(a) of the Securities Exchange Act of 1934, as amended (the 'Exchange
Act') during Fiscal 1998.
EXECUTIVE OFFICERS
The only executive officers of the Company other than Messrs. Rheinfrank,
Zak, Lund and Thome, who are listed above as nominees for director, are H.
Torsten Andersch and James C. Shay.
Mr. Andersch, age 41, is a Vice President having joined the Company's
wholly-owned subsidiary, BHA Group GmbH as Sales Manager in September 1990. He
became Assistant General Manager in December 1990 and was promoted to General
Manager of BHA Group GmbH in September 1992. Prior to September 1990, he was
employed as Sales Manager at Eastman Christensen GmbH.
Mr. Shay, age 35, has been Treasurer and Chief Financial Officer since
March 1994. He assumed the responsibilities of Secretary in May 1997. He joined
the Company as Controller in June 1992. From 1986 to 1992, he was employed at
KPMG Peat Marwick LLP as an Audit Manager and in various other positions.
4
<PAGE>
<PAGE>
EXECUTIVE COMPENSATION
I. SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
-------------------------------- -----------------------------------------
AWARDS PAYOUTS
-------------------------- -----------
SECURITIES
OTHER UNDER-
ANNUAL RESTRICTED LYING ALL OTHER
COMPEN- STOCK OPTIONS/ LTIP COMPEN-
NAME AND PRINCIPAL FISCAL SALARY BONUS(1) SATION AWARD(S)(3) SARS PAYOUTS(4) SATION
POSITION YEAR ($) ($) ($)(2) ($) (#) ($) ($)
(a) (b) (c) (d) (e) (f) (g) (h) (i)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James E. Lund, 1998 241,800 -- -- -- -- -- 11,996(5)
Chief Executive Officer 1997 221,800 84,500 -- -- -- 71,000 14,120(6)
and President 1996 195,000 83,750 -- -- -- 66,000 13,800(7)
- -----------------------------------------------------------------------------------------------------------------------------------
Lamson Rheinfrank, Jr., 1998 178,500 -- -- -- -- -- 10,416(5)
Chairman 1997 178,500 42,250 -- -- -- 35,500 12,540(6)
1996 172,500 41,875 -- -- -- 33,000 12,220(7)
- -----------------------------------------------------------------------------------------------------------------------------------
Michael T. Zak, 1998 201,800 -- -- -- -- -- 9,148(5)
Vice Chairman 1997 201,800 84,500 -- -- -- 71,000 11,272(6)
1996 195,000 83,750 -- -- -- 66,000 10,774(7)
- -----------------------------------------------------------------------------------------------------------------------------------
James J. Thome, 1998 241,800 -- -- -- -- -- 8,006(5)
Executive Vice President 1997 210,150 78,163 -- -- -- 65,675 9,493(6)
and Chief Operating 1996 172,500 71,188 -- -- -- 56,100 9,173(7)
Officer
- -----------------------------------------------------------------------------------------------------------------------------------
James C. Shay, 1998 120,000 -- -- -- -- -- 6,716(5)
Chief Financial Officer, 1997 97,500 33,800 -- -- -- 24,850 8,840(6)
Treasurer and Secretary 1996 82,500 26,200 -- -- -- 16,500 7,083(7)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Bonus payments were based on the Company's financial performance for each
fiscal year (see 'Compensation Committee Report on Executive
Compensation -- Annual Cash Incentives').
(2) No amounts for executive earnings and other personal benefits are shown
because the aggregate dollar amount per executive is less than either
$50,000 or 10% of annual salary and bonus.
(3) The total number of shares and their Fair Market Value ('FMV'), calculated
by multiplying the closing market price of unrestricted Common Stock on a
specific date by the number of shares of restricted stock. The related
vesting time table is represented in the following table:
<TABLE>
<CAPTION>
Number of
Shares on Vested Stock Awards -- Time Table
Award ---------------------------------------------
Date and FMV ($) FMV ($)
held as on on Oct. Oct. Oct. Oct. Oct.
of Sept. Award Sept. 18, 18, 18, 18, 18,
Name of Participant 30, 1998 Date 30, 1998 1995 1996 1997 1998 1999
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James E. Lund 11,459 $131,779 $134,643 2,292 2,292 2,291 2,292 2,292
Lamson Rheinfrank 1,825 $20,988 $21,444 365 365 365 365 365
Michael T. Zak 5,540 $63,710 $65,095 1,108 1,108 1,108 1,108 1,108
James J. Thome 8,696 $100,004 $102,178 1,739 1,739 1,740 1,739 1,739
James C. Shay 669 $ 7,694 $ 7,861 134 134 133 134 134
</TABLE>
As holders of restricted stock, the executives have, with respect to the
restricted stock, all of the rights of a stockholder of the Company,
including the right to vote the restricted stock and receive dividends and
distributions thereon.
5
<PAGE>
<PAGE>
(4) Represents payments of bonus awards made pursuant to the Company's Incentive
Compensation Plan (see 'Compensation Committee Report on Executive
Compensation -- Stock Compensation -- Incentive Compensation Plan').
(5) Amounts of All Other Compensation for Fiscal 1998 include the following:
(i) Contributions by the Company under the ESOP: each executive $5,696;
(ii) Contributions by the Company under the 401(k) plan: each executive
$600; and,
(iii) Premiums on life insurance for executives paid by the Company: Mr.
Lund, $5,700; Mr. Rheinfrank, $4,120; Mr. Zak, $2,852; Mr. Thome,
$1,710; Mr. Shay, $420.
(6) Amounts of All Other Compensation for Fiscal 1997 include the following:
(i) Contributions by the Company under the ESOP: each executive $7,820;
(ii) Contributions by the Company under the 401(k) plan: each executive,
$600; and,
(iii) Premiums on life insurance for executives paid by the Company: Mr.
Lund, $5,700; Mr. Rheinfrank, $4,120; Mr. Zak, $2,852; Mr. Thome,
$1,073; Mr. Shay, $420.
(7) Amounts of All Other Compensation for Fiscal 1996 include the following:
(i) Contributions by the Company under the ESOP: Mr. Lund, $7,500; Mr.
Rheinfrank, $7,500; Mr. Zak, $7,500; Mr. Thorne, $7,500; Mr. Shay,
$6,063;
(ii) Contributions by the Company under the 401(k) plan: each executive
$600; and,
(iii) Premiums on life insurance for executives paid by the Company: Mr.
Lund, $5,700; Mr. Rheinfrank, $4,120; Mr. Zak, $2,674; Mr. Thome,
$1,073; Mr. Shay, $420.
II. OPTION/SAR GRANTS TABLE
The following table sets forth information with respect to the named
executives concerning the grant of stock options during Fiscal 1998.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rate of Stock
Price Appreciation
Individual Grant Award for Option
- ------------------------------------------------------------------------------------------- ---------------------
% of Total
Number of Options
Securities Granted to
Underlying Employees Exercise or
Options in Fiscal Base Price Expiration
Name Granted Year ($/Sh) Date 5% 10%
- --------------------------------------- ---------- ---------- ----------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
James E. Lund 42,300 14.6% $ 16.00 6/17/08 425,636 1,078,645
Lamson Rheinfrank Jr. 42,300 14.6% $ 16.00 6/17/08 425,636 1,078,645
Michael T. Zak 42,300 14.6% $ 16.00 6/17/08 425,636 1,078,645
James J. Thorne 42,300 14.6% $ 16.00 6/17/08 425,636 1,078,645
James C. Shay 42,300 14.6% $ 16.00 6/17/08 425,636 1,078,645
James C. Shay 5,000 1.7% $ 18.50 5/15/08 58,173 147,421
</TABLE>
- ------------
The options represented above were granted during Fiscal 1998 and vest in four
annual increments of 25%. The options may not be exercisable until the price of
the Common Stock reaches $25.00 per share. Regardless of the price of the Common
Stock, the options will be 100% vested after seven years.
6
<PAGE>
<PAGE>
III. AGGREGATED OPTION EXERCISES IN FISCAL 1998
AND FISCAL YEAR-END ('FY-END') OPTION VALUES
<TABLE>
<CAPTION>
SHARES
ACQUIRED VALUE NUMBER OF SECURITIES UNDERLYING
ON EXERCISE REALIZED UNEXERCISED OPTIONS AT FY-END
NAME (#)(1) ($) (#)(2)
- -------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d)
- -------------------------------------------------------------------------------------------------------------------------
Exercisable Unexercisable(3)
------------------------------- -----------------
<S> <C> <C> <C> <C>
James E. Lund 79,860 590,365 19,965 150,111
- -------------------------------------------------------------------------------------------------------------------------
Lamson Rheinfrank, Jr. -- -- 39,929 42,300
- -------------------------------------------------------------------------------------------------------------------------
Michael T. Zak 64,208 485,927 35,617 42,300
- -------------------------------------------------------------------------------------------------------------------------
James J. Thome 57,898 438,072 19,965 135,470
- -------------------------------------------------------------------------------------------------------------------------
James C. Shay 5,503 31,546 14,641 68,917
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
VALUE OF UNEXERCISED
IN-THE MONEY OPTIONS AT
FY-END(4)
NAME ($)
- ------------------------------------------------------------------------------
(a) (e)
- ------------------------------------------------------------------------------
Exercisable Unexercisable(3)
----------- -----------------
- ------------------------------------------------------------------------------
<S> <C> <C>
James E. Lund -- 497,009
- ------------------------------------------------------------------------------
Lamson Rheinfrank, Jr. 134,302 --
- ------------------------------------------------------------------------------
Michael T. Zak 48,678 --
- ------------------------------------------------------------------------------
James J. Thome -- 429,514
- ------------------------------------------------------------------------------
James C. Shay 44,322 45,824
- ------------------------------------------------------------------------------
</TABLE>
- ------------
(1) All of the options granted under the Incentive Stock Plan expire ten years
from the date of award. The above table shows that during the current fiscal
year several executive officers exercised certain stock options. The
majority of the options exercised during fiscal 1998 were awarded during
1988 and as such, had reached the end of their ten year term. Consistent
with the Compensation Committee's strategy emphasizing long-term stock
ownership (refer to the 'Compensation Committee Report on Executive
Compensation'), the executive officers that exercised stock options shown
above retained the maximum number of shares possible using only a portion of
the shares acquired to pay the option exercise price and income taxes.
(2) The Company announced a 10% stock dividend in May 1998. As provided for in
the Plan, the Compensation Committee approved an appropriate adjustment to
the aggregate number of shares available under the Plan and to the number of
shares and the exercise price relating to outstanding options. The
Compensation Committee also reduced the minimum fair market value
requirement of the Common Stock associated with the exercisability of
certain options from $16.53 to $15.03. Regardless of the price of the Common
Stock, the options will be 100% vested after seven years.
(3) Includes options that have not met vesting requirements and minimum fair
market value requirements.
(4) The closing price of the Common Stock at the end of Fiscal 1998 was $11.75.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During Fiscal 1998, the Compensation Committee was comprised of Messrs.
Alexander, Freeland, McDonnell and Green. No such member of the Compensation
Committee was at any time an officer or employee of the Company or any of its
subsidiaries.
EXECUTIVE EMPLOYMENT CONTRACTS
The Company has employment agreements with each of the executive officers
listed in the Summary Compensation Table (each, an 'Agreement' and collectively,
the 'Agreements'). The initial terms of the Agreements expired on September 30,
1997 at which point they became subject to one year automatic extensions on each
October 1, unless either party gives notice within 30 days of such October 1 of
his or its election to have such automatic extensions cease. All of the
Agreements have been automatically extended.
Each Agreement prohibits the executive from competing with the Company for
the three year period after the termination of such employment with the Company.
Each Agreement further provides that if the Company terminates the Agreement
without cause, the executive covered by such Agreement is entitled to the base
salary he would have received through the then current expiration of
7
<PAGE>
<PAGE>
such Agreement and the pro rata portion of the annual bonus that would have been
earned in the year of termination. Finally, each Agreement provides for such
continuing payments in the event that the executive terminates his Agreement for
good reason, or in certain instances, for any reason. Compensation paid to the
five most highly compensated executive officers pursuant to the Agreements is
included for each executive in the Summary Compensation Table.
COMPENSATION COMMITTEE REPORT ON
EXECUTIVE COMPENSATION
The Board believes that increasing the value of the Company to its
stockholders is the Board's most important objective and should be the key
measure of management performance. The Board also believes that executive
compensation should be objectively determined. For this reason, the Compensation
Committee, which is made up of directors who are not employees of the Company,
is responsible for determining the compensation packages of the Company's
executives. The Compensation Committee also approves the potential levels of
contribution to the Company's ESOP and 401(k) plans for the ensuing year.
The Compensation Committee's role in determining the compensation of the
executives of the Company is to assure that the Company's compensation strategy
is aligned with the Board's overall objective and that executive compensation is
structured to provide fair, reasonable and competitive base salary levels and
the opportunity for the executives to earn incentive compensation reflecting
both the Company's and the individual's performance.
The Compensation Committee has implemented an executive compensation
program designed to accomplish the Board's objective. The program is based upon
the principles that: executive performance should be judged and compensated
primarily on the basis of the Company's earnings and the strength of the
Company's financial position; long-term changes in stockholder value are the
most appropriate measure of the Company's financial performance; and the most
effective approach to promoting the financial success of the Company is to align
the stockholders' and the executives' interests.
The Compensation Committee concluded that this alignment is best
accomplished through a compensation strategy emphasizing long-term stock
ownership. As a result, the executive compensation program was implemented to
increase the proportion of long-term compensation tied to increases in the
Company's earnings, financial position and appreciation in stockholder value.
The annual cash compensation for executive officers is primarily in the form of
base salary, which is being maintained at levels consistent with competitive
market compensation practices, and annual cash incentives based on quantitative
objectives tied to the Company's financial performance. Annual cash compensation
is supplemented with long-term incentive compensation, primarily in the form of
restricted stock and stock options, intended to link executive compensation to
changes in stockholders' value.
In order to help ensure that the strategy emphasizing long-term stock
ownership is implemented, the Compensation Committee has expressed its intent
that future awards of stock incentives to the executives are dependent upon such
executives retaining ownership of a substantial portion of the shares of the
Company's Common Stock acquired through the stock incentive awards. The
Compensation Committee has advised the executive officers that they should
retain a majority (less shares forfeited or used to pay the option exercise
price or taxes) of all restricted stock and stock acquired through the exercise
of options previously awarded. Since 1994, the executives of the Company have
exercised certain stock options and have retained the maximum number of shares
possible after using a portion of the shares to pay the option exercise price
and income taxes.
The Compensation Committee believes that while the Company should provide
an opportunity for its executives to acquire significant equity in the Company,
realization of the benefits of this opportunity should generally occur only
after the stockholders have benefited from an increase in the value of their
investment. For this reason, the Compensation Committee adopted the policy that
recipients of stock options would be generally permitted to exercise options,
regardless of exercise price, only if the per share fair market value of the
Common Stock was equal to a price that represented a premium to the option
exercise price. The Compensation Committee for each individual grant of stock
options determines this premium stock price. In compliance with the Company
policy, in Fiscal 1998, options
8
<PAGE>
<PAGE>
were awarded that may not be exercisable until the per share fair market value
of the Common Stock was equal to $25.00 for twenty two consecutive business
days.
The Compensation Committee intends that the application of these principles
will result in total executive compensation and capital accumulation potential
above competitive levels for superior stockholder returns and below competitive
levels for average or lesser returns.
There are three components to the Company's executive compensation
packages: base salary, annual cash incentives and stock compensation. Each of
these components is discussed in detail below.
BASE SALARY
Base salaries are established under the Agreements for each person within
the executive group. Factors considered in establishing salaries include the
responsibilities of the position, compensation of executives in companies of
similar size or in the same industry and external market conditions.
ANNUAL CASH INCENTIVES
Annual cash incentive awards are based entirely on quantitative objectives
tied to the Company's financial performance. Executives can earn bonuses based
upon the Company's performance as measured against pre-determined financial
objectives for the fiscal year. Performance is measured by comparing Company net
earnings to targeted levels as established in the Company's business plan and
approved by the Compensation Committee for the fiscal year. The ratio of net
earnings to targeted levels is multiplied by each individual's bonus maximum to
determine the annual bonus payout for each period. The amounts of each
individual's maximum bonus receive Compensation Committee approval and are
determined considering the impact on overhead as a percentage of sales, the
responsibility of each position and the compensation level required to provide a
competitive employee compensation package. The annual bonus component of
compensation enables the Company to adjust payouts to executives based on
Company performances with only modest adjustments to base salaries. During
Fiscal 1998, the Company's executive officers did not earn an annual cash
incentive award as the Company did not meet the pre-determined financial
objectives for the fiscal year.
STOCK COMPENSATION
The key component to the Compensation Committee's strategy is to make stock
incentives, which consist primarily of awards of restricted stock and stock
options, a significant portion of the executives' compensation package. Stock
incentives may be awarded pursuant to the following plans:
INCENTIVE COMPENSATION PLAN
The Company has an Incentive Compensation Plan pursuant to which the Board
is authorized to grant certain executive officers of the Company shares of
Common Stock or cash following the end of each fiscal year. The grants are
awarded pursuant to a formula which is based on the financial performance of the
Company and its subsidiaries over a three year period of time. Awards under the
Incentive Compensation Plan require a minimum average earnings growth for the
most recent three year period of time, as determined by the Compensation
Committee. Using a three year measurement period for financial performance
enables the Company to provide incentives to executives for implementing and
executing strategies essential to long-term success. During Fiscal 1998, the
Company's executive officers did not earn a payout under the Incentive
Compensation Plan as the Company did not achieve the minimum average earnings
growth for the most recent three year period of time, as determined by the
Compensation Committee. Payments made relating to Fiscal 1997 and 1996
performance are summarized in column (h) of the Executive Compensation Table.
INCENTIVE STOCK PLAN
During Fiscal 1998, shareholders approved an amendment and restatement of
the Company's Incentive Stock Plan. The Incentive Stock Plan, as amended and
restated, provides for the award of non-qualified and incentive stock options,
restricted stock and payments to non-employee directors in shares of Common
9
<PAGE>
<PAGE>
Stock. The Incentive Stock Plan, as amended and restated, also permits the
Compensation Committee to grant the following additional types of discretionary
awards: Stock Appreciation Rights, Dividend Equivalent Awards, Stock Awards and
other Stock based awards. During Fiscal 1998, the Compensation Committee
approved the award of stock options as summarized in Table II of this report.
The stock options granted during the current year vest over a four year period
and expire 10 years from the date of grant. The recipients of these options are
only permitted to exercise the options when the fair market value of Common
Stock reaches $25 per share, representing a premium over the share price of the
Common Stock on the date of award.
In determining the amount of future stock incentives to be awarded to an
executive, the Compensation Committee will, in addition to other factors,
consider previous awards, whether the executive has exercised, to the extent
possible, options previously awarded and whether the shares of the Company's
Common Stock acquired thereby or shares of restricted stock previously awarded
have been retained by the executive. By linking the executives' compensation and
net worth to the value of the Company's Common Stock, the Compensation Committee
seeks to focus the attention of the executives on the Board's overall objective
of building long-term stockholder value.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
Mr. Lund received total compensation amounting to $253,796 in Fiscal 1998.
His Fiscal 1998 compensation included a 9% increase in base salary over Fiscal
1997. He did not earn an annual bonus in Fiscal 1998, as the Company's net
earnings did not meet the performance criteria as described under 'Annual Cash
Incentives' above. Further, Mr. Lund did not earn an Incentive Compensation Plan
payout in Fiscal 1998 as the Company did not achieve the minimum average annual
earnings growth financial objective for the three year period as provided for
under that plan (as described more fully above). The Compensation Committee
considers Mr. Lund's compensation to be in line with industry and market size
standards and to be consistent with Company performance objectives.
This report was presented to and approved by the Board.
Don H. Alexander
Robert D. Freeland
Thomas A. McDonnell
Richard C. Green, Jr.
10
<PAGE>
<PAGE>
COMPARISON OF FIVE YEAR-CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPHS FOR
BHA GROUP HOLDINGS, INC.
The following graph reflects a comparison of the cumulative total
stockholder return (change in stock price plus reinvested dividends) of an
initial $100 investment on September 30, 1993 in the Company's Common Stock, the
Standard & Poors 500 Stock Index and the First Analysis Environmental Index. The
comparisons in this table are required by the Securities and Exchange
Commission. The stock price performance shown on the graph is not intended to
forecast or be indicative of future price performance.
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
9/93 9/94 9/95 9/96 9/97 9/98
<S> <C> <C> <C> <C> <C> <C>
BHA GROUP HOLDINGS INC. 100 93.92 98.44 117.32 154.59 116.62
S&P 500 INDEX 100 103.69 134.53 161.88 227.36 247.92
FIRST ANALYSIS 100 100.75 112.23 124.47 155.74 130.08
</TABLE>
11
<PAGE>
<PAGE>
COMPARISON OF LONG-TERM CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPHS FOR
BHA GROUP HOLDINGS, INC.
The following graph reflects a comparison of the cumulative total
stockholder return (change in stock price plus reinvested dividends) of an
initial $100 investment on November 30, 1986 (which corresponds to the month in
which the Company's stock first traded) in the Company's Common Stock, the
Standard & Poors 500 Stock Index and the First Analysis Environmental Index. The
stock price performance shown on the graph is not intended to forecast or be
indicative of future price performance.
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
11/86 9/87 9/88 9/89 9/90 9/91 9/92 9/93 9/94 9/95 9/96 9/97 9/98
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BHA GROUP HOLDINGS, INC. 100 207.41 266.7 625.05 558.38 475.05 508.36 468.87 440.38 461.56 550.16 724.9 546.74
S&P 500 INDEX 100 133.07 116.61 155.09 140.76 184.63 205.03 231.69 240.23 311.68 375.06 526.76 574.41
FIRST ANALYSIS 100 145.94 128.83 180.3 157.09 183.84 166.41 158.28 159.47 177.65 197.01 246.51 205.89
</TABLE>
12
<PAGE>
<PAGE>
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of December 31, 1998, the Company had outstanding and entitled to vote
7,106,478 shares of Common Stock. As of December 31, 1998, the trustee of the
ESOP was the registered holder of 447,603 shares of Common Stock, 427,864 of
which have vested in participant accounts. Participants in the ESOP are entitled
to vote both the vested and unvested shares which are in their account.
The following table sets forth, as of December 31, 1998, certain
information with respect to (a) each person known by the Company to own
beneficially five percent or more of the outstanding Common Stock, (b) each of
the directors and nominees for director of the Company, (c) each of the
executive officers named in the Summary Compensation Table, and (d) all
directors and executive officers of the Company as a group:
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE PERCENT OF
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP(1) COMMON STOCK
- ------------------------------------------------------------ -------------------------- ------------
<S> <C> <C>
Merrill Lynch Asset Management ............................. 667,457 9.4%
800 Grudders Mill Road
Plainsboro, NJ 08536
T. Rowe Price Associates ................................... 659,549 9.3%
100 East Pratt Street
Baltimore, Maryland 21202
Royce & Associates, Inc. .................................. 512,936 7.2%
1414 Avenue of the Americas
New York, New York 10019
Lamson Rheinfrank, Jr. .................................... 498,889(2) 7.0%
BHA Group Holdings, Inc.
8800 East 63rd Street
Kansas City, Missouri 64133
Robert Fleming, Inc. ...................................... 413,403 5.8%
25 Copthall Ave
London EC2R 7DR
Robert D. Freeland ......................................... 106,157(3) 1.5%
Havens Steel Company
7219 East 17th Street
Kansas City, Missouri 64126
James E. Lund .............................................. 103,058(4) 1.5%
BHA Group Holdings, Inc.
8800 East 63rd Street
Kansas City, Missouri 64133
Michael T. Zak ............................................. 99,022(5) 1.4%
BHA Group Holdings, Inc.
8800 East 63rd Street
Kansas City, Missouri 64133
James J. Thome ............................................. 79,209(6) 1.1%
BHA Group Holdings, Inc.
8800 East 63rd Street
Kansas City, Missouri 64133
Don H. Alexander ........................................... 25,927(7) *
Alexander & Associates, Inc.
408 Miami
Kansas City, KS 66105
Thomas A. McDonnell ........................................ 23,646(8) *
DST Systems, Inc.
333 W. 11th Street, Fifth Floor
Kansas City, Missouri 64105
James C. Shay .............................................. 20,512(9) *
BHA Group Holdings, Inc.
8800 East 63rd Street
Kansas City, Missouri 64133
</TABLE>
(table continued on next page)
13
<PAGE>
<PAGE>
(table continued from previous page)
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE PERCENT OF
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP(1) COMMON STOCK
- ------------------------------------------------------------ -------------------------- ------------
<S> <C> <C>
Richard C. Green ........................................... 10,617(10) *
UtiliCorp United, Inc.
MSC 2-283
20 West 9th Street
Kansas City, Missouri 64105
All directors and executive officers as a group (9
people)................................................... 967,037 13.6%
</TABLE>
- ------------
* Less than 1%
(1) All information is as of December 31, 1998 and was determined in accordance
with Rule 13d-3 under the Exchange Act, based upon information furnished by
the persons listed or contained in filings made by them with the Securities
and Exchange Commission. Unless otherwise indicated, beneficial ownership
disclosed consists of sole voting and dispositive power.
(2) Consists of 29,731 shares of Common Stock held of record by Mr. Rheinfrank,
171,445 shares of Common Stock held by irrevocable family trusts of which
Mr. Rheinfrank is the co-trustee, 7,000 shares of Common Stock held by his
daughters (as to which shares he disclaims any beneficial interest), 32,490
shares of Common Stock owned by Mr. Rheinfrank's wife (as to which shares
he disclaims any beneficial interest), 24,200 shares of Common Stock in the
Rheinfrank Foundation, 187,550 shares of Common Stock in the Rheinfrank
Family Limited Partnership, options to purchase 39,929 shares of Common
Stock under the Plan which are exercisable within 60 days of December 31,
1998, 1,825 shares of restricted stock, and 4,719 shares of Common Stock
held of record by the trustee of the ESOP for Mr. Rheinfrank who is
entitled to vote such shares by virtue of the allocation under the ESOP.
(3) Consists of 10,536 shares of Common Stock held of record by Mr. Freeland
and 95,621 shares of Common Stock held of record by Havens Steel Company,
with whom Mr. Freeland shares investment power through his position as
Chairman of the Board of that Company, but as to which Mr. Freeland
disclaims any beneficial interest.
(4) Consists of 50,044 shares of Common Stock held of record by Mr. Lund, 8,052
shares of Common Stock owned by Mr. Lund's wife (as to which shares he
disclaims any beneficial interest), options to purchase 19,965 shares of
Common Stock under the Plan which are exercisable within 60 days of
December 31, 1998, 11,459 shares of restricted stock, and 13,538 shares of
Common Stock held of record by the trustee of the ESOP for Mr. Lund who is
entitled to vote such shares by virtue of the allocation under the ESOP.
(5) Consists of 41,194 shares of Common Stock held of record by Mr. Zak and his
wife, 3,993 shares of Common Stock held by his children as to which shares
he disclaims any beneficial interest, options to purchase 35,617 shares of
Common Stock under the Plan which are exercisable within 60 days of
December 31, 1998, 5,540 shares of restricted stock, and 12,678 shares of
Common Stock held of record by the trustee of the ESOP for Mr. Zak who is
entitled to vote such shares by virtue of the allocation under the ESOP.
(6) Consists of 38,918 shares of Common Stock held of record by Mr. Thome,
options to purchase 19,965 shares of Common Stock under the Plan which are
exercisable within 60 days of December 31, 1998, 8,696 shares of restricted
stock, and 11,630 shares of Common Stock held of record by the trustee of
the ESOP for Mr. Thome who is entitled to vote such shares by virtue of the
allocation under the ESOP.
(7) Consists of 25,927 shares of Common Stock held of record by Mr. Alexander.
(8) Consists of 16,160 shares of Common Stock held of record by Mr. McDonnell
and options to purchase 7,486 shares under the Plan which are exercisable
within 60 days of December 31, 1998.
(footnotes continued on next page)
14
<PAGE>
<PAGE>
(footnotes continued from previous page)
(9) Consists of 4,042 shares of Common Stock held of record by Mr. Shay,
options to purchase 14,641 shares of Common Stock under the Plan which are
exercisable within 60 days of December 31, 1998, 669 shares of restricted
stock, and 1,160 shares of Common Stock held of record by the trustee of
the ESOP for Mr. Shay who is entitled to vote such shares by virtue of the
allocation under the ESOP.
(10) Consists of 10,617 shares of Common Stock held of record by Mr. Green.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
(PROPOSAL NO. 2)
KPMG Peat Marwick LLP is the accounting firm which examined and reported on
the Company's financial statements for Fiscal 1998. KPMG Peat Marwick LLP has
been selected by the Board to serve as the Company's accounting firm for Fiscal
1999. Representatives of KPMG Peat Marwick LLP are expected to attend the Annual
Meeting. The representatives of KPMG Peat Marwick LLP will have the opportunity
to make a statement if they desire to do so and will be available to respond to
appropriate questions.
The Board is seeking stockholder approval of its selection of KPMG Peat
Marwick LLP. Stockholder approval requires the affirmative vote of the holders
of a majority of the shares present or represented and entitled to vote at the
Annual Meeting. THE BOARD RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
SELECTION OF KPMG PEAT MARWICK LLP AND IT IS INTENDED THAT SHARES REPRESENTED BY
THE ENCLOSED FORM OF PROXY WILL BE VOTED IN FAVOR OF THE RATIFICATION OF THE
SELECTION OF KPMG PEAT MARWICK LLP UNLESS OTHERWISE SPECIFIED IN SUCH PROXY. If
stockholders do not ratify the appointment of KPMG Peat Marwick LLP as the
auditors of the Company for Fiscal 1999 at the Annual Meeting, the Board, on
recommendation of its Audit Committee, may reconsider the selection.
TIME FOR SUBMISSION OF PROPOSAL OF STOCKHOLDERS
Any stockholder who intends to present a proposal for action at the
Company's Annual Meeting of Stockholders scheduled to be held on February 22,
2000, must comply with and meet the requirements of Regulation 14a-8 of the
Exchange Act. That regulation requires, among other things, that a proposal be
received by the Company at its principal executive office, 8800 East 63rd
Street, Kansas City, Missouri 64133, by September 17, 1999.
GENERAL AND OTHER MATTERS
Management knows of no matter other than the matters described above which
will be presented to the Annual Meeting. However, if any other matters properly
come before the meeting, or any of its adjournments, the person or persons
voting the proxies will vote them in accordance with his or their best judgment
on such matters. You are urged to sign and return your proxy to make certain
your shares will be voted at the Annual Meeting.
By Order of the Board of Directors
JAMES C. SHAY
Secretary
Kansas City, Missouri
January 14, 1999
15
<PAGE>
<PAGE>
APPENDIX I
PROXY CARD
PROXY BHA GROUP HOLDINGS, INC.
8800 EAST 63RD STREET, KANSAS CITY, MISSOURI 64133
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS -- FEBRUARY 23, 1999
The undersigned hereby appoints James E. Lund and James C. Shay, or either of
them, as Proxy or Proxies of the undersigned with full power of substitution to
attend and to represent the undersigned at the Annual Meeting of Stockholders of
BHA Group Holdings, Inc. (the 'Company') to be held on February 23, 1999, and at
any adjournments thereof, and to vote thereat the number of shares of stock of
the Company the undersigned would be entitled to vote if personally present, in
accordance with the instructions set forth on this proxy card. Any proxy
heretofore given by the undersigned with respect to such stock is hereby
revoked.
1. ELECTION OF DIRECTORS.
NOMINEES: Don H. Alexander, Robert D. Freeland, Richard C. Green, James E.
Lund, Thomas A. McDonnell, Lamson Rheinfrank, Jr., James J. Thome and
Michael T. Zak.
[ ] FOR ALL nominees listed above.
[ ] FOR ALL nominees listed above EXCEPT:
___________________________________________________________________________
(INSTRUCTION: To withhold authority to vote on any individual nominee,
write the name above.)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed above.
<PAGE>
<PAGE>
2. RATIFICATION OF KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITORS OF THE COMPANY
FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 1999.
<TABLE>
<S> <C> <C>
[ ] FOR the ratification of KPMG [ ] AGAINST the ratification of KPMG [ ] ABSTAIN
Peat Marwick LLP. Peat Marwick LLP.
</TABLE>
3. ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
If no specification is made, this proxy will be voted FOR Proposals 1 and 2
listed above.
Dated: ______________________, 1999
___________________________________
___________________________________
Please sign exactly as name appears
above. For joint accounts, each
joint owner must sign. Please give
full title if signing in a
representative capacity.
[ ] PLEASE CHECK IF YOU PLAN TO ATTEND THE MEETING
PLEASE MARK, DATE AND SIGN THIS PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE
