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 (Amendment No. )
Filed by 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
(Name of Registrant as Specified In Its Charter)
STEVENS INTERNATIONAL, INC.
___________________________________________________________________________
(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 numer of securities to which transactions 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>
STEVENS INTERNATIONAL, INC.
5700 E. Belknap
Fort Worth, Texas 76117
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 25, 2000
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Stevens
International, Inc. (the "Company") will be held at The Fort Worth Club, 306
West 7th Street, 12th Floor, Fort Worth, Texas 76102, on Thursday, May 25,
2000, at 10:00 a.m., local time, for the following purposes:
(1) to elect six members of the Board of Directors (constituting the
entire Board of Directors) to serve until the next Annual Meeting of
Stockholders and until their respective successors shall be elected
and qualified.
(2) to transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on April 10, 2000, has been fixed as the record
date for determining holders of Series A Common Stock and Series B Common
Stock entitled to notice of and to vote at the Annual Meeting of
Stockholders or any adjournments thereof. For a period of at least 10 days
prior to the Annual Meeting, a complete list of stockholders entitled to
vote at the Annual Meeting will be open to examination of any stockholder
during ordinary business hours at the offices of the Company, 5700 E.
Belknap, Fort Worth, Texas 76117.
Information concerning the matters to be acted upon at the Annual Meeting
is set forth in the accompanying Proxy Statement.
HOLDERS OF SERIES A COMMON STOCK AND SERIES B COMMON STOCK WHO DO NOT
EXPECT TO BE PRESENT AT THE MEETING IN PERSON ARE URGED TO COMPLETE, DATE,
SIGN AND RETURN THE APPROPRIATE PROXY IN THE ACCOMPANYING ENVELOPE, WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors
/s/ Paul I. Stevens
-------------------------------------------------
Paul I. Stevens
Chairman of the Board and Chief Executive Officer
Fort Worth, Texas
April 21, 2000
<PAGE>
STEVENS INTERNATIONAL, INC.
5700 E. Belknap
Fort Worth, Texas 76117
PROXY STATEMENT
For
ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 25, 2000
This Proxy Statement is being first mailed on or about April 21, 2000 to
stockholders of Stevens International, Inc. (the "Company") by the Board of
Directors to solicit proxies (the "Proxies") for use at the Annual Meeting
of Stockholders (the "Meeting") to be held at The Fort Worth Club, 306 West
7th Street, 12th Floor, Fort Worth, Texas 76102, at 10:00 a.m. local time,
on Thursday, May 25, 2000, or at such other time and place to which the
Meeting may be adjourned.
The purpose of the Meeting is to consider and vote upon (i) the election
of six directors (constituting the entire Board of Directors) to serve until
the next Annual Meeting of Stockholders and until their respective
successors shall be elected or qualified; and (ii) such other matters as may
properly come before the Meeting or any adjournment thereof.
All shares represented by valid Proxies, unless the stockholder otherwise
specifies, will be voted (i) FOR the election of each person named herein
under "Proposal No. 1, Election of Directors" as a nominee for election as a
director of the Company for the term described therein, and (ii) at the
discretion of the Proxy holders with regard to any other matter that may
properly come before the Meeting or any adjournment thereof.
Where a stockholder has appropriately specified how a Proxy is to be
voted, it will be voted accordingly. The Proxy may be revoked at any time
by providing written notice of such revocation to American Stock Transfer &
Trust Company, 40 Wall Street, New York, NY 10005, Attention: Isaac Kagan.
If notice of revocation is not received by the Meeting date, a stockholder
may nevertheless revoke a Proxy if he attends the Meeting and desires to
vote in person.
RECORD DATE AND VOTING SECURITIES
The record date for determining the stockholders entitled to vote at the
Meeting is the close of business on April 10, 2000 (the "Record Date"), at
which time the Company had issued and outstanding 7,466,347 shares of
Series A Common Stock, par value $0.10 per share ("Series A Stock"), and
2,035,786 shares of Series B Common Stock, par value $0.10 per share
("Series B Stock"). Series A Stock and Series B Stock (collectively,
"Common Stock") are the only outstanding securities of the Company entitled
to vote at the Meeting.
<PAGE>
At the Meeting, the holders of Series A Stock, voting separately as a
class, are entitled to elect two directors, and the holders of Series B
Stock, voting separately as a class, are entitled to elect the remaining
directors. As to any other matters that may properly come before the
Meeting, the holders of Series A Stock and Series B Stock vote together as a
class, with each holder of Series A Stock having one-tenth of one vote for
each share of Series A Stock held by him or her, and each holder of Series B
Stock having one vote for each share of Series B Stock held by him or her.
QUORUM
The presence at the Meeting, in person or by proxy, of the holders of a
majority of the issued and outstanding shares of each Series of Common Stock
is necessary to constitute a quorum to elect the directors of that Series,
and the presence of the holders of a majority of the issued and outstanding
shares of Common Stock as a single class is necessary to constitute a quorum
to transact all other business to come before the Meeting.
The election inspectors will treat shares referred to as "broker non-
votes" (i.e. shares held by brokers or nominees as to which they have no
discretionary power to vote on a particular matter and have received no
instructions from the beneficial owners or persons entitled to vote
thereon), if any, as shares that are present and entitled to vote for
purposes of determining the presence of a quorum. However, for purposes of
determining the outcome of any matter in which brokers or nominees have no
discretionary power to vote, broker non-votes will be treated as not present
and not entitled to vote with respect to that matter (even though those
shares are considered entitled to vote for quorum purposes and may be
entitled to vote on other matters). Brokers or nominees have discretionary
power to vote on Proposal No. 1.
PROPOSAL NO. I
ELECTION OF DIRECTORS
Nominees for Directors
Six directors are to be elected, each director to hold office for a term
of one year or until his or her successor shall have been elected and
qualified. Under the terms of the Company's Certificate of Incorporation,
the holders of Series A Stock, voting separately as a class, are entitled to
elect 25% of the Board of Directors (or the next higher whole number if such
percentage is not a whole number), and the holders of Series B Stock, voting
separately as a class, are entitled to elect the remaining directors.
Accordingly, of the six directors to be elected, two will be Series A
Directors to be elected by holders of Series A Stock, and four will be
Series B Directors to be elected by holders of Series B Stock. Approval of
the proposal to elect the nominees to serve as directors of the applicable
Series requires the affirmative vote of the holders of a majority of the
shares of that Series present, in person or by proxy, at the Meeting. Votes
may be cast in favor or withheld with respect to such proposal. Votes that
are withheld will be counted toward a quorum, but will be excluded entirely
from the tabulation for such proposal and, therefore, will not affect the
outcome of the vote on such proposal.
<PAGE>
It is intended that the names of the persons indicated in the following
table will be placed in nomination and that the persons named in the Proxy
will vote for their election. Each of the nominees has indicated his or her
willingness to serve as a member of the Board of Directors if elected;
however, in case any nominee shall become unavailable for election to the
Board of Directors for any reason not presently known or contemplated, the
Proxy holders will have discretionary authority in that instance to vote the
Proxy for a substitute.
<TABLE>
The nominees are as follows:
Director
Name Age Since Positions with the Company
- ---------------------- --- -------- ---------------------------------
<S> <C> <C> <C>
Series A Directors:
Michel A. Destresse 73 1996 Director
Edgar H. Schollmaier 67 1995 Director
(1)(2)(3)
Series B Directors:
Paul I. Stevens (3) 85 1986 Chairman of the Board, Chief
Executive Officer
Richard I. Stevens 61 1986 President, Chief Operating
Officer and Director
Constance I. Stevens 56 1987 Vice President, Secretary and
Director
James D. Cavanaugh (1) 61 1993 Director
____________________
(1) Member of the Audit Committee.
(2) Member of the Stock Option and Compensation Committee.
(3) Member of the Executive Committee.
</TABLE>
James D. Cavanaugh has served as a director of the Company since May
1993. Mr. Cavanaugh served as Executive Vice President of Rockwell Graphic
Systems from May 1983 until June 1985 and served as its President and Chief
Executive Officer from June 1985 until his retirement in March 1993.
Edgar H. Schollmaier has served as a director of the Company since March
1995. Mr. Schollmaier, Chairman of Alcon Laboratories, Inc., a maker of
ophthalmic, pharmaceutical and therapeutic products, has served that firm in
various capacities since 1958, including President and Chief Executive
Officer from May 1977 to October 1, 1997.
<PAGE>
Michel A. Destresse has served as a director of the Company since May
1996. Mr. Destresse served as President Directeur Generale of Stevens
International, S.A. (formerly Stevens Security Systems, S.A.) from March 29,
1996 to December 31, 1996 and as a consultant to the Chief Executive Officer
of the Company since November 1995. From November 1992 to September 1995,
Mr. Destresse served as the International Monetary Fund General Advisor to
the Governor of the Central Bank of Russia, where he provided general advice
on monetary policy, organization, legal matters, internal audit, branch
problems and systems of payment. From 1950 to 1992, Mr. Destresse served in
various capacities with the Banque de France, including Executive Director
of the Printing Works, Director of the Legal Department and as a member of
the Board of Directors for 15 years.
Paul I. Stevens founded Stevens Corporation ("Stevens") in 1965 and
founded the Company in 1986 to be a holding company for Stevens. He has
served the Company as Chairman of the Board and Chief Executive Officer
since December 1986 and served Stevens as an officer and a director since
its inception. In 1974, Mr. Stevens founded Stevens Industries, Inc., a
family-owned holding company which is an affiliate of the Company and of
which he is the controlling stockholder. Mr. Stevens is the father of
Richard I. Stevens and Constance I. Stevens.
Richard I. Stevens has served as President and a director of the Company
since December 1986 and Chief Operating Officer of the Company since April
1987. Mr. Stevens also served as Vice President and Assistant Secretary of
the Company from December 1986 until April 1987. He has served Stevens in
various capacities since its inception, including serving as its President
from 1969 until December 1987, and as a director beginning in 1969.
Mr. Stevens is a stockholder, officer and director of Stevens Industries,
Inc. Mr. Stevens is the son of Paul I. Stevens and brother of Constance I.
Stevens.
Constance I. Stevens has served as a director of the Company since April
1987. Ms. Stevens has served as Vice President and Assistant Secretary to
the Company since 1995, and Secretary since 1998. From July 1989 to July
1995, Ms. Stevens served as President of a project management consulting
firm in Carmel, California. From May 1980 until July 1989, Ms. Stevens
served as the managing partner of Merritt Associates of Carmel, California,
an architectural design and real estate development firm. Ms. Stevens is a
stockholder, officer and director of Stevens Industries, Inc. Ms. Stevens
is the daughter of Paul I. Stevens and sister of Richard I. Stevens.
Except as otherwise noted, no family relationships exist among the
directors of the Company.
Meetings and Committees of the Board of Directors
The business of the Company is managed under the direction of the Board
of Directors. The Board meets on a regularly scheduled basis to review
significant developments affecting the Company and to act on matters
requiring Board approval. It also holds special meetings when an important
matter requires Board action between scheduled meetings. The Board of
Directors met four times during 1999 in regular sessions and one time during
1999 in special session.
<PAGE>
The Board of Directors has three standing committees, the Audit
Committee, the Stock Option and Compensation Committee and the Executive
Committee and the full Board of Directors acts to nominate persons to serve
on the Board. The functions of the committees, their current members and
the number of meetings held during 1999 are described below.
The functions performed by the Audit Committee include: recommending to
the Board of Directors selection of the Company's independent accountants
for the ensuing year; reviewing with the independent accountants and
management the scope and results of the audit; reviewing the independence of
the independent accountants; reviewing the independent accountants' written
recommendations and corresponding actions by management; and meeting with
management and the independent auditors to review the effectiveness of the
Company's system of internal control. The committee currently is composed
of James D. Cavanaugh and Edgar H. Schollmaier. The committee met two times
during 1999.
The Stock Option and Compensation Committee administers the Company's
Stock Option Plan and reviews other matters regarding the compensation of
employees of the Company. The committee currently is composed of Paul I.
Stevens and Edgar H. Schollmaier. The committee did not meet formally
during 1999.
The function of the Executive Committee is to direct and manage the
business and affairs of the Company in the intervals between meetings of the
Board of Directors. The Executive Committee is empowered to act in lieu of
the Board on any matter except that for which the Board has specifically
reserved authority to itself and except for those matters specifically
reserved to the full Board pursuant to the Delaware General Corporation
Law. The Executive Committee is currently comprised of Paul I. Stevens
(Chairman) and Edgar H. Schollmaier. The Executive Committee acted by
written consent one time and met one time in 1999.
During 1999, each director attended more than 75% of the meetings of the
Board of Directors and respective committees on which he or she served.
PRINCIPAL STOCKHOLDERS AND MANAGEMENT OWNERSHIP
The following table sets forth information as of April 10, 2000 (except
as otherwise noted) regarding the beneficial ownership of Common Stock by
each person known by the Company to own 5% or more of the outstanding shares
of each Series of Common Stock, each director and nominee for director of
the Company, including the Company's Chief Executive Officer, each other
Named Executive Officer listed in the Summary Compensation Table below, and
the current directors and Named Executive Officers of the Company as a
group. The persons named in the table have sole voting and investment power
with respect to all shares of Common Stock owned by them, unless otherwise
noted. Of the shares issued and outstanding as of April 10, 2000, Paul I.
Stevens, Chairman of the Board of the Company, and members of his immediate
family, own approximately 13.6% of the outstanding Series A Stock and 93.9%
of the outstanding Series B Stock, representing in the aggregate
approximately 72.4% of the total voting power of Common Stock with respect
to matters on which Series A Stock and Series B Stock vote together.
<PAGE>
In April 2000, the Company completed a private placement of $1 million of
10% convertible subordinated notes ("the Notes"). Net proceeds of the Notes
will be used for working capital. The Notes were issued in increments of
$50,000 and are convertible into 2,000,000 shares of Series A Common Stock
("SVEIA") of the Company at $0.50 per share, subject to adjustment. The
conversion of the Notes is at the holder's option anytime on or after the
fifteenth day following the original issue date of the Notes and prior to
the close of business on their maturity date. Issue costs for the Notes
aggregated approximately $151,000.
The Company has committed to register the shares that would be issuable
upon conversion of the Notes. Dilution to existing shareholders would occur
as a result of the conversion of the Notes to 2 million shares of Series A
common stock. Should all the Notes be converted, these shareholders would
own approximately 17% of the outstanding stock of the Company. The first
quarter of 2000 will include a charge for interest expense of $1 million
with a corresponding $1 million increase in "Paid in Capital in Excess of
Par Value."
<PAGE>
<TABLE>
Series A Stock (1) Series B Stock (2)
------------------- -----------------------
Name of Beneficial Number Percent Number Percent
Owner or Group of Series of Series
-------------------------------- ------- --------- --------- ---------
<S> <C> <C> <C> <C>
Paul I. Stevens(3)(4) .......... 953,202 12.8 1,702,615 90.6
Richard I. Stevens(3)(5) ....... 216,464 2.9 250,313 12.3
Constance I. Stevens(3)(6) ..... 246,617 3.3 107,650 5.3
James D. Cavanaugh(8) .......... 45,000 * - -
Edgar H. Schollmaier(7) ........ 495,000 6.6 - -
Michel A. Destresse(10) ....... 20,000 * - -
George A. Wiederaenders(9) ..... 53,275 * - -
Stevens Industries, Inc.(3) .... 73,106 0.1 74,140 3.6
All current directors and Named Executive
Officers as a group (8 persons) 1,810,240 24.2 1,912,298 93.9
____________________
* Less than 1%
(1) The information set forth for Series A Stock does not include the
shares of Series B Stock of such holder which are convertible, at any
time and from time to time, into shares of Series A Stock on a share-
for-share basis.
(2) Each share of Series B Stock is convertible into Series A Stock on a
share-for-share basis at any time.
(3) The address of Paul I. Stevens, Richard I. Stevens and Constance I.
Stevens is 5700 E. Belknap, Fort Worth, Texas 76117 and the address of
Stevens Industries, Inc. is P.O. Box 562, Fort Worth, Texas 76101. The
shares of Paul I. Stevens, Richard I. Stevens and Constance I. Stevens
include shares held by Stevens Industries, Inc. because, due to their
positions as officers, directors and stockholders of such corporation,
they could be deemed to share beneficial ownership of its shares.
(4) Includes 765,096 shares of Series A Stock and 1,628,475 shares of
Series B Stock owned by a trust for which Mr. Stevens and his wife
serve as Trustees, and 115,000 shares of Series A Stock options
available for purchase.
(5) Includes 115,000 shares of Series A Stock options available for
purchase.
(6) Includes 40,000 shares of Series A Stock options available for
purchase.
(7) Includes 25,000 shares of Series A Stock options available for
purchase.
(8) Includes 35,000 shares of Series A Stock options available for
purchase.
(9) Includes 50,000 shares of Series A Stock options available for
purchase.
(10) Includes 20,000 shares of Series A Stock options available for
purchase.
</TABLE>
<PAGE>
MANAGEMENT COMPENSATION AND TRANSACTIONS
Summary Compensation Table
The following table sets forth certain information regarding
compensation paid during each of the Company's last three fiscal years
to the Company's Chief Executive Officer and each of the Company's other
executive officers serving at fiscal 1999 year end whose salary and
bonus exceeded $100,000, (the "Named Executive Officers").
<TABLE>
Long Term Compensation
----------------------------------
Awards Payouts
Annual Compensation ------------------------- -------
----------------------------------
Securities
Name and Other Annual Restricted Underlying LTIP All Other
Principal Fiscal Compensation Stock Options/SARs Payouts Compensation
Position Year Salary ($) Bonus ($) ($)(1) Award(s) (#) ($) ($)
-------- ----- ---------- --------- ------ -------- ------- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paul I. Stevens, 1999 -0- - - - 115,000 - -
Chairman of the Board 1998 116,957 - - - 115,000 - -
and Chief Executive 1997 234,737 - - - 90,000 - -
Officer
Richard I. Stevens, 1999 40,000(2) - - - 115,000 - -
President and Chief 1998 182,852 - 2,850 - 115,000 - -
Operating Officer 1997 231,000 - 2,568 - 90,000 - -
George A. 1999 95,000 - - - 50,000 - -
Wiederaenders, Vice 1998 93,232 - 946 - 50,000 - -
President, Treasurer 1997 101,251 25,000 871 - 25,000 - -
and Chief Accounting
Officer
(1) Consists of automobile allowance and group insurance costs.
(2) Deferred compensation of $100,000 was recorded in 1999 for Richard I.
Stevens, but not paid to increase the cash availability of the Company.
</TABLE>
<PAGE>
Option Grants During 1998 Fiscal Year
No executive officers received options in the fiscal year 1999.
Options Exercised During 1999 Fiscal Year and Fiscal Year End Option
Values
There were no options exercised during the fiscal year 1999.The
following table provides information related to the number and value of
options held at fiscal year end. The Company does not have any
outstanding stock appreciation rights.
<TABLE>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Options/SAR's Options/SAR's
At FY-End (#) At FY-End ($)
-------------------------- ---------------------------
Shares Acquired Value
Name on Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
---- --------------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Paul I. Stevens - - 115,000 - - -
Chairman of the Board
and Chief Executive
Officer
Richard I. Stevens - - 115,000 - - -
President and Chief
Operating Officer
George A. - - 50,000 - - -
Wiederaenders Vice
President , Treasurer
and Chief Accounting
Officer
</TABLE>
Report of the Compensation and Stock Option Committees on Repricing of
Options/Sars
The Company's stock option plan has been used to provide executive
officers and other key employees with increased motivation and incentive to
exert their best efforts on behalf of the Company through the opportunity to
benefit from appreciation in the value of the Series A Common Stock. Due to
a decline in the price of the Common Stock in fiscal 1997, certain options
outstanding under the Company's stock option plan were exercisable at prices
which exceeded the then current market value of the Series A Common Stock.
In order to restore the incentive value to such options, the Board of
Directors approved the repricing of options.
<PAGE>
On September 10, 1997, each option outstanding under the Company's stock
option plan, with an exercise price exceeding the market price of the
Company's Series A Common Stock was canceled and reissued with an exercise
price equal to the then current market price of $1.50. All other terms and
conditions of these options remained the same. Additionally, as previously
reported, in fiscal 1993 the Company repriced stock options as set forth
below. The following table provides information related to all repricing of
options during the last ten fiscal years for the named executive officers.
Ten-Year Option/SAR Repricings
<TABLE>
Ten-Year Option/SAR Repricings
Number of Market
Securities Price of
Underlying Stock at Length of
Options/ Time of Exercise Price at Original Option
SARs Repriced Repricing Time of Repricing New Term Remaining at
or or or Amendment Exercise Date of Repricing
Name Date Amended (#) Amendment ($) ($) Price ($) or Amendment
---- ---- ----------- ------------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C>
Paul I. Stevens, 9/10/97 90,000 $1.50 50,000/$5.50 $1.50 September 1999
Chairman of the Board 40,000/$4.5625 November 1997
and Chief Executive
Officer
Richard I. Stevens, 9/10/97 90,000 $1.50 50,000/$5.50 $1.50 September 1999
President and Chief 40,000/$4.5625 $1.50 November 1997
Operating Officer 11/18/92 30,000 $4.5625 $8.00 $4.5625 March 1994
George A. Wiederaenders, 9/10/97 25,000 $1.50 15,000/$7.125 $1.50 March 2000
Vice President, 10,000/$4.5625 $1.50 November 1997
Treasurer and Chief 11/18/92 6,500 $4.5625 $15.00 $4.5625 January 1997
Accounting Officer
</TABLE>
This report is submitted by members of the Board of Directors, Edgar H.
Schollmaier, Paul I. Stevens, Richard I. Stevens, Constance I. Stevens James
D. Cavanaugh and Michel A. Destresse
Pension Plan and Trust
Effective January 1, 1989, the Company established the Stevens
International, Inc. Pension Plan and Trust (the "Pension Plan"). The
Pension Plan replaced and is the successor to two pension plans previously
maintained by subsidiaries of the Company. The Pension Plan is a tax
qualified defined benefit pension plan under Section 401(a) et. seq. of the
Code.
<PAGE>
The Company's Board of Directors decided to permanently freeze all
benefits under the Pension Plan effective April 30, 1997, as a part of the
cost reduction measures taken in 1997. This action eliminates all future
benefit accruals for participants in the Pension Plan for 1997 and
thereafter.
The following table illustrates estimated annual benefits payable upon
retirement in specified compensation and years of service classifications
and assumes (i) the participant attained age 65 in 1996, (ii) the
compensation presented is subject to the maximum permitted in 1996 and
preceding years, (iii) annual Social Security covered compensation amount
for 1996 is $27,580, (iv) the maximum allowable years of service is 40, (v)
the participant elected to receive his benefits for life, and (vi) the
Internal Revenue Code limitation on benefits elected remains at the level of
$120,000, the 1996 limit.
<TABLE>
Years of Service
-----------------------------------------------------------
Compensation 15 20 25 30 35 40
------------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
$100,000 15,784 22,152 28,519 34,886 41,253 46,518
125,000 20,147 28,264 36,381 44,499 52,616 59,255
150,000 24,509 34,377 44,244 55,411 63,978 71,993
175,000 27,934 39,552 51,169 62,786 74,403 84,168
200,000 31,359 44,727 58,094 71,461 84,828 96,343
225,000 33,157 47,258 61,358 75,458 89,559 101,806
250,000 33,341 47,441 61,542 75,642 89,743 101,990
300,000 33,341 47,441 61,542 75,462 89,743 101,990
</TABLE>
The amount of a participant's normal benefit is based on the
participant's accrued benefit as of December 31, 1991, plus, with respect to
service of participants after December 31, 1991, .75% of the participant's
monthly compensation for each year of participation (not to exceed 40
years), plus .5% of the participant's monthly compensation (in excess of the
Social Security covered compensation) for each year of participation (not to
exceed 35 years). Under the Code, the annual benefit payable to a
participant under the Pension Plan (expressed as a single life annuity
beginning at the participant's Social Security retirement age), is limited
to $120,000 in 1996 or, if less, 100% of the participant's average annual
compensation for the participant's highest three years of consecutive
service. For purposes of the Pension Plan, compensation includes a
participant's base compensation, bonuses, commissions, and overtime pay.
Compensation considered under the Pension Plan is subject to limits imposed
by the Code ($150,000 in 1996). Benefits provided by the Company under the
Pension Plan will become fully vested and nonforfeitable following the
completion of five years of service by a participant.
<PAGE>
The estimated credited years of service under the Pension Plan for each
of the executive officers listed in the compensation table above is as
follows: Mr. Paul I. Stevens, seven years; Mr. Richard I. Stevens, seven
years; and George Wiederaenders, seven years.
Under one of the predecessor pension plans, benefits have vested on
behalf of Mr. Richard I. Stevens who is entitled to a monthly annuity
benefit for life of $2,083, commencing on his normal retirement date.
Compensation of Directors
The following table provides information related to the compensation paid
to outside directors of the Company.
<TABLE>
Cash Compensation Stock Options
Number of
Securities
Annual Underlying
Name and Retainer Meeting Consulting Number of Options
Principal Position Fee Fee Fee/Other Shares (#) SARs(#)
<S> <C> <C> <C> <C> <C>
James D. Cavanaugh - $9,000 - 5,000 -
Audit Committee
Michel A. Destresse - - $19,500 5,000 -
Edgar H. Schollmaier - $7,500 - 5,000 -
Executive, Compensation,
and Audit Committees
(a) Directors who are also executives of the Company are not listed in the
above table. They do not receive compensation as directors. Refer to
the Summary Compensation Table for information concerning their
compensation.
(b) Amounts shown include cash compensation earned and received as well as
amounts earned but deferred at the election of directors.
(c) Each director generally receives $1,500/board meeting and
$1,500/committee meeting, however, certain director fees in 1999 were
deferred. Mr. Destresse receives consulting fees in lieu of director
fees.
(d) The reasonable expenses incurred by each director in connection with
his or her duties as a director are also reimbursed by the Company;
this amount is not reflected in the above table.
(e) There were no retainer fees paid in 1999.
<PAGE>
Report of the Compensation Committee of the Board of Directors on Executive
Compensation
The Company's executive compensation program is administered by the Stock
Option and Compensation Committee of the Board of Directors. During 1999,
the Committee was composed of two independent, nonemployee directors. The
Committee is committed to a strong, positive link between business,
performance and strategic goals, and compensation and benefit programs.
Accordingly, as part of stringent cost reduction measures, all officer base
pay was reduced from 5% to a maximum of 50% in July, 1997.
Overall Executive Compensation Policy
The Company's compensation policy is designed to support the overall
objective of enhancing value for the Company's stockholders by:
* Attracting, developing, rewarding and retaining highly qualified and
productive individuals.
* Relating compensation to both Company and individual performance.
* Ensuring compensation levels that are externally competitive and
internally equitable.
* Encouraging executive stock ownership to enhance a mutuality of
interest with other stockholders.
The following is a description of the elements of the Company's executive
compensation and how each relates to the objectives and policy outlined
above.
Base Salary
The Committee reviews each executive officer's salary annually. In
determining appropriate salary levels, the Committee considers individual
performance, internal equity, as well as pay practices of other companies
relating to executives of similar responsibility.
By design, the Committee strives to set executives' salaries at
competitive market levels. However, in July, 1997, the performance of the
Company necessitated a reduction of all officer salaries from 5% to a
maximum of 50% of base pay. In addition certain reductions of the Chairman
and CEO occurred in 1998. The Committee believes maximum performance can be
encouraged through the use of appropriate incentive programs. Incentive
programs for executives are as follows:
<PAGE>
Annual Incentives
Generally, discretionary annual incentive award opportunities are made to
executives to recognize and reward corporate and individual performance.
Senior executives may receive bonuses ranging from 60% to 75% of eligible
base compensation with attainment measured by corporate net income as
compared to the annual plan. Bonuses can be increased or decreased
incrementally based upon performance for the year. Other corporate officers
and key employees may receive bonuses ranging from 5% to 20% of eligible
base compensation, measured by corporate net income. Accordingly, no
senior executive officers were awarded an incentive bonus based upon 1998
performance. External market data is reviewed periodically to determine
competitive incentive opportunities for individual executives. The Company
believes that it is in the mid-range of compensation and annual incentive
programs, when compared to external compensation data.
Long-Term Incentives
The Company's long-term compensation philosophy is that long-term
incentives should be related to improvement in long-term stockholder value,
thereby creating a mutuality of interest with stockholders. In furtherance
of this objective, the Company awards to its executive officers stock
options.
Stock options encourage and reward effective management that results in
long-term corporate financial success, as measured by stock price
appreciation. Stock options generally are exercisable at the fair market
value at date of grant and options are generally exercisable in two
installments beginning one year after date of grant.
Rationale for CEO Compensation
Mr. Paul I. Stevens has been Chairman and Chief Executive Officer of the
Company since 1986. His compensation package has been designed to encourage
short and long-term performance in line with the interests of the Company's
stockholders. Mr. Stevens' large stock ownership percentage as described
elsewhere herein is a substantial incentive to perform in such a way to
enhance stockholders' interest and returns. His base pay was reduced 50% to
$150,000 in July, 1997. In addition, Mr. Stevens voluntarily eliminated his
base pay beginning October 1, 1998, to increase the cash availability of the
Company. He is a participant in the incentive plans described above.
The factors which the Committee considered in determining Mr. Stevens'
50% reduction in base pay in July, 1997, and the voluntary elimination of
his base pay in October 1998, relate principally to the need for stringent
cost reduction at all levels of the Company. Mr. Stevens declined his bonus
earned for fiscal year 1995. No such incentive was paid to Mr. Stevens for
fiscal years 1999, 1998, 1997, and 1996. In granting stock options in 1998
and 1997 to Mr. Stevens, as well as other executives, the Committee took
into account the executive's level and scope of responsibility and
contributions to the Company, as well as competitive long-term incentive
practices as verified by external surveys.
<PAGE>
This report is submitted by the Stock Option and Compensation Committee
of the Board of Directors, Mr. Edgar H. Schollmaier, member.
The Board Compensation Committee Report on Executive Compensation shall
not be deemed incorporated by reference by any general statement
incorporating by reference this proxy statement into any filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except to the
extent that the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under such Acts.
Stock Option and Compensation Committee and Insider Participation
During fiscal 1999, the members of the Stock Option and Compensation
Committee were primarily responsible for determining executive compensation
and matters relating to stock options, although certain of such matters were
discussed by the full Board of Directors. Paul I. Stevens, as a director as
well as an executive officer of the Company, participated in such
discussions.
The Company and Xytec Corporation ("Xytec"), a subsidiary of Stevens
Industries, Inc., one of the principal shareholders of the Company and a
corporation controlled by Paul I. Stevens, Richard I. Stevens and Constance
I. Stevens, entered into an agreement during 1994 for Xytec to provide
software and computer-related services and equipment of $2.1 million as a
subcontractor on a major contract. During 1997, 1998 and 1999, the Company
paid approximately $594,000, $856,000 and $328,000 to Xytec on this
contract. The cost to Xytec of this subcontract was approximately 92% of
its billings to the Company, or $575,000 in 1997, $787,000 in 1998, and
$302,000 in 1999.
Through September 30, 1998, each of Paul I. Stevens and Richard I.
Stevens owned a 22.5% interest in a joint venture which was the landlord
under the lease of the Company's corporate headquarters. Amounts paid to
the joint venture as rent and maintenance in 1998 and 1997 were
approximately $84,000 and $111,000.
Through December 31, 1999, Paul I. Stevens, the Company's Chairman and
Chief Executive Officer has loaned the Company $6.2 million on a long-term
arrangement. The long-term loans from Paul I. Stevens are due June 30, 2001
and bear interest at rates that vary up to 2% over bank prime.
Paul I. Stevens' loans at December 31, 1999 have first liens on certain
assets of the Company, principally a $0.5 million platen cutter relating to
the hold back on the 1997 sale of the Company's Zerand division, the assets
of a foreign subsidiary, and certain accounts receivable for new customer
equipment. The Company was paid $500,000 of the Zerand escrow hold back
funds net of amounts owed to the purchaser on November 6, 1998. Because
these hold back funds collateralized certain Paul I. Stevens advances, the
$500,000 was paid to him to reduce his secured loans to the Company.
The Company believes that the transactions described above are beneficial
to the Company and are on terms as favorable to the Company as could be
obtained from unaffiliated third parties. Such transactions are expected to
be continued in the future, with review of and the approval required by the
independent members of the Board of Directors.
<PAGE>
Stock Performance Chart
The following chart compares the yearly percentage change in the
cumulative total stockholder return on the Company's Series A Stock during
the five fiscal years ended December 31, 1999 (adjusted for a stock split
and the reclassification of the Company's Common Stock into Series A Stock
and Series B Stock) with the cumulative total return on the Media General
Composite Market Value Index and the Printing Equipment (SIC Code 355)
Machinery Industry Index. The comparison assumes $100 was invested on
December 31, 1994 in the Company's Common Stock and in each of the foregoing
indices and assumes reinvestment of dividends.
Comparison of Total Return of the Company, Peer Group
and Broad Market
[PERFORMANCE GRAPH APPEARS HERE]
</TABLE>
<TABLE>
12/30/ 12/29/ 12/31/ 12/31/ 12/31/ 12/31/
Company/Index/Market 1994 1995 1996 1997 1998 1999
- -------------------------- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Stevens Intl CL A 100 52.24 17.91 12.66 13.43 3.22
Special Industry Machinery 100 145.39 137.38 172.75 173.39 446.37
AMEX Market Index 100 128.90 136.01 163.66 161.44 201.27
</TABLE>
SECTION 16 REQUIREMENTS
Section 16(a) of the Exchange Act requires the Company's directors and
officers, and persons who own more than 10% of a registered class of the
Company's equity securities, to file initial reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission
(the "SEC"). Such persons are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it
with respect to fiscal 1999, or written representations from certain
reporting persons, the Company believes that all filing requirements
applicable to its directors, officers and persons who own more than 10% of a
registered class of the Company's equity securities have been complied with.
<PAGE>
INDEPENDENT AUDITORS
On May 21, 1998, Stevens International, Inc. (The "Company") dismissed
Deloitte & Touche LLP ("Deloitte & Touche") as its principal independent
accountants. The decision to dismiss Deloitte & Touche was approved by the
Company's Board of Directors as well as the Audit Committee of the Board of
Directors. Deloitte & Touche's report on the Company's financial statements
for the fiscal year ended December 31, 1997 did not contain an adverse
opinion or disclaimer of opinion. However, such report was qualified or
modified as to uncertainties involving factors raising substantial doubt
about the Company's ability to continue as a going concern. There were no
adjustments in the consolidated financial statements that might result from
the outcome of this uncertainty.
During the Company's 1996 and 1997 fiscal years and the period through
May 21, 1998, there were no disagreements between the Company and Deloitte &
Touche on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure which if not resolved to
the satisfaction of Deloitte & Touche would have caused it to make reference
to the subject matter(s) of the disagreement(s) in connection with its
reports.
A letter from Deloitte & Touche confirming the statements contained
herein was filed as an exhibit to Form 8-K filed on May 29, 1998.
On May 21, 1998, the Company retained Grant Thornton LLP to serve as the
Company's principal independent accountants. During the Company's 1996 and
1997 fiscal years and the period through May 21, 1998, the Company did not
consult Grant Thornton LLP regarding the application of accounting
principles to a specified transaction or the type of audit opinion that
might be rendered on the Company's financial statements.
Representatives of Grant Thornton LLP are expected to be present at the
Meeting with the opportunity to make a statement if they desire to do so and
to be available to answer appropriate questions.
STOCKHOLDERS' PROPOSALS
Stockholders may submit proposals on matters appropriate for stockholder
action at subsequent annual meetings of the Company consistent with Rule
14a-8 promulgated under the Securities Exchange Act of 1934, as amended.
For such proposals to be considered in the Proxy Statement and Proxy
relating to the 2001 Annual Meeting of Stockholders, such proposals must be
received by the Company not later than January 20, 2001. Such proposals
should be directed to Stevens International, Inc., 5700 E. Belknap, Fort
Worth, Texas 76117.
OTHER BUSINESS
The Board of Directors knows of no matters other than those described
herein that will be presented for consideration at the Meeting. However,
should any other matters properly come before the Meeting or any adjournment
thereof, it is the intention of the persons named in the accompanying Proxy
to vote in accordance with their best judgment in the interest of the
Company.
<PAGE>
MISCELLANEOUS
All costs incurred in the solicitation of Proxies will be borne by the
Company. In addition to solicitation by mail, the officers and employees of
the Company may solicit Proxies by telephone, telegraph or personally,
without additional compensation. The Company may also make arrangements
with brokerage houses and other custodians, nominees and fiduciaries for the
forwarding of solicitation materials to the beneficial owners of shares of
Common Stock held of record by such persons, and the Company may reimburse
such brokerage houses and other custodians, nominees and fiduciaries for
their out-of-pocket expenses incurred in connection therewith.
The Company's annual report to shareholders for 1999 is being mailed with
this proxy statement to stockholders entitled to vote at the Meeting. The
Annual Report is not to be deemed part of this Proxy Statement.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K, INCLUDING THE
FINANCIAL STATEMENTS AND THE FINANCIAL STATEMENT SCHEDULE, BUT NOT INCLUDING
EXHIBITS, WILL BE FURNISHED AT NO CHARGE TO EACH PERSON TO WHOM A PROXY
STATEMENT IS DELIVERED UPON THE WRITTEN REQUEST OF SUCH PERSON ADDRESSED TO
STEVENS INTERNATIONAL, INC., ATTN: MS. CONSTANCE STEVENS, 5700 E. BELKNAP,
FORT WORTH, TEXAS 76117.
By Order of the Board of Directors
/s/ PAUL I. STEVENS
---------------------------
PAUL I. STEVENS
Chairman of the Board
and Chief Executive Officer
Fort Worth, Texas
April 21, 2000
<PAGE>
STEVENS INTERNATIONAL, INC.
ANNUAL MEETING OF STOCKHOLDERS
SERIES A COMMON STOCK
The undersigned hereby appoints Paul I. Stevens and Richard I.
Stevens, each with power to act without the other and with full power of
substitution, as Proxies to represent and to vote, as designated on the
reverse, all Series A common Stock of Stevens International, Inc. owned
by the undersigned, at the Annual Meeting of Stockholders to be held at
The Fort Worth Club, 306 West 7th Street, 12th Floor, Fort Worth, Texas,
76102, on Thursday, May 25, 2000, at 10:00 a.m. local time, upon such
other business as may properly come before the meeting or any adjournment
thereof including the following:
(CONTINUED, AND TO BE SIGNED AND DATED ON REVERSE SIDE)
- ---------------------------------------------------------------------------
<PAGE>
A [X] Please mark your
votes as in this example.
FOR all nominees
Listed at right WITHHOLD AUTHORITY
(Except as marked to the To vote for all
contrary below) nominees listed at right NOMINEES:
Michel A. Destresse
Edgar H. Schollmaier
1. Election of [ ] [ ]
Directors
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME IN THE SPACE BELOW.
- ---------------------------------------------------------------------------
2. In their discretion on any other matter that may properly come before
the meeting or any adjournment thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no specific direction is
given, this proxy will be voted (i) for the election of the nominees for
director, and (ii) at the discretion of the proxy holders with regard to
any other matter that may properly come before the meeting or any
adjournment thereof.
This proxy may be revoked prior to the exercise of the powers conferred
by the proxy.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE DATE, SIGN EXACTLY AS SHOWN HEREON AND MAIL PROMPTLY THIS PROXY IN
THE ENCLOSED ENVELOPE.
Signature_________________________________________Dated______________2000
Note: Please date, sign exactly as shown hereon and mail promptly
this proxy in the enclosed envelope. When there is more than
one owner, each should sign. When signing as an attorney,
administrator, executor, guardian or trustee, please add your
title as such. If executed by a corporation, the proxy should
be signed by a duly authorized officer. If executed by a
partnership, please sign in the partnership name as an
authorized person.
<PAGE>
STEVENS INTERNATIONAL, INC.
ANNUAL MEETING OF STOCKHOLDERS
SERIES B COMMON STOCK
The undersigned hereby appoints Paul I. Stevens and Richard I.
Stevens, each with power to act without the other and with full power of
substitution, as Proxies to represent and to vote, as designated on the
reverse, all Series B common Stock of Stevens International, Inc. owned
by the undersigned, at the Annual Meeting of Stockholders to be held at
The Fort Worth Club, 306 West 7th Street, 12th Floor, Fort Worth, Texas,
76102, on Thursday, May 25, 2000, at 10:00 a.m. local time, upon such
other business as may properly come before the meeting or any adjournment
thereof including the following:
(CONTINUED, AND TO BE SIGNED AND DATED ON REVERSE SIDE)
- ---------------------------------------------------------------------------
<PAGE>
A [X] Please mark your
votes as in this example.
FOR all nominees
Listed at right WITHHOLD AUTHORITY
(Except as marked to the To vote for all
contrary below) nominees listed at right NOMINEES:
Paul I. Stevens
Richard I. Stevens
1. Election of [ ] [ ] Constance I. Stevens
Directors James D. Cavanaugh
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME IN THE SPACE BELOW.
- ---------------------------------------------------------------------------
2. In their discretion on any other matter that may properly come before
the meeting or any adjournment thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no specific direction is
given, this proxy will be voted (i) for the election of the nominees for
director, and (ii) at the discretion of the proxy holders with regard to
any other matter that may properly come before the meeting or any
adjournment thereof.
This proxy may be revoked prior to the exercise of the powers conferred
by the proxy.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE DATE, SIGN EXACTLY AS SHOWN HEREON AND MAIL PROMPTLY THIS PROXY IN
THE ENCLOSED ENVELOPE.
Signature______________________________________________Dated_________2000
Note: Please date, sign exactly as shown hereon and mail promptly
this proxy in the enclosed envelope. When there is more than
one owner, each should sign. When signing as an attorney,
administrator, executor, guardian or trustee, please add your
title as such. If executed by a corporation, the proxy should
be signed by a duly authorized officer. If executed by a
partnership, please sign in the partnership name as an
authorized person.
