HOLIDAY RV SUPERSTORES, INCORPORATED
SAND LAKE WEST EXECUTIVE PARK
7851 GREENBRIAR PARKWAY
ORLANDO, FLORIDA 32819
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 1999
AT
ORLANDO, FLORIDA
----------------------
April 8, 1999
To the Stockholders of
HOLIDAY RV SUPERSTORES, INC.
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Shareholders of
Holiday RV Superstores, Incorporated (the "Company") will be held at the offices
of the Company, Sand Lake West Executive Park, 7851 Greenbriar Parkway, Orlando,
Florida 32819, on MAY 17, 1999, AT 10:00 A.M. EASTERN DAYLIGHT TIME, to consider
and act upon the following matters:
1. To elect eight (8) directors to serve until the next Annual Meeting
and until their successors have been duly elected and qualified.
2. To approve the engagement of accountants as Independent Certified
Public Accountants for the Company for the fiscal year ending
October 31, 1999.
3. To ratify and approve the 1999-Stock Option Plan ("Plan") and the
setting aside of 500,000 shares issuable under the Plan.
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only Shareholders of record on the books of the Company at the close of
business on March 12, 1999, will be entitled to notice of and to vote at the
meeting or any adjournment thereof. A list of shareholders entitled to vote at
the meeting may be examined at the executive offices of the Corporation at Sand
Lake West Executive Park, 7851 Greenbriar Parkway, Orlando, Florida 32819.
By Order of the Board of Directors.
Joanne M. Kindlund
SECRETARY
IMPORTANT
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
<PAGE>
HOLIDAY RV SUPERSTORES, INCORPORATED
SAND LAKE WEST EXECUTIVE PARK
7851 GREENBRIAR PARKWAY
ORLANDO, FLORIDA 32819
INFORMATION STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 17, 1999
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
INTRODUCTION
This Information Statement is furnished in connection with matters to
be voted at the Annual Meeting of Shareholders of Holiday RV Superstores,
Incorporated, a Florida Corporation (the "Company") to be held at 10:00 A.M.
(EDT) on Monday, May 17, 1999, at the corporate office, Sand Lake West Executive
Park, 7851 Greenbriar Parkway, Orlando, Florida 32819, and at any and all
adjournments thereof with respect to matters referred to in the accompanying
notice. The approximate date on which this Information Statement will first be
sent to the Company's Shareholders is April 9, 1999.
The Common Stock ($.01 par value) is the only outstanding class of
voting securities. Shareholders of record at the close of business on March 12,
1999, the Company had 7,166,500 shares of Common Stock, par value $.01 per
share, outstanding and entitled to vote. Each share is entitled to one vote.
The presence, in person or by proxy, of the holders of one-third of the
total of the outstanding voting Shares is necessary to constitute a quorum at
the Annual Meeting. Approval of the proposals to be presented at the Annual
Meeting will require an affirmative vote of the holders of a majority of the
Shares present at the meeting.
BENEFICIAL SECURITY OWNERSHIP
The following table sets forth as of March 12, 1999, the number of
shares, of the Common Stock of the Company, owned and the percent so owned (i)
each person known to the Company to be the beneficial owner of more than 5% of
the outstanding Common Stock, (ii) each director and/or officer of the Company,
and (iii) all directors and officers of the Company as a group. The number of
shares owned are those "beneficially owned" as determined under the rules of the
Securities and Exchange Commission, including any shares of Common Stock as to
which a person has sole or shared voting power or investment power and any
shares of Common Stock which the person has the right to acquire within 60 days
through the exercise of any option, warrant or right.
NAME AND ADDRESS NUMBER PERCENTAGE
OF BENEFICIAL OWNER OF SHARES OF CLASS
- ------------------- --------- ----------
Newton C. Kindlund (1) 2,223,414 30.4%
7851 Greenbriar Parkway
Orlando, Florida 32819
Joanne M. Kindlund (1) 2,223,414 30.4%
7851 Greenbriar Parkway
Orlando, Florida 32819
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NAME AND ADDRESS NUMBER PERCENTAGE
OF BENEFICIAL OWNER OF SHARES OF CLASS
- ------------------- --------- ----------
W. Hardee McAlhaney 135,000(2) 1.9%
3701 Sedgewick Place
Orlando, Florida 32806
James P. Williams 11,500(3) *
615 North Wymore Road
Winter Park, Florida 32789
Paul G. Clubbe 50,000(3) *
R.R. #4 Stouffville
Ontario, Canada L4A 7X5
Roy W. Parker -0- *
455 South Lake Destiny Road
Orlando, Florida 32810
Harvey M. Alper 1,500 *
112 W. Citrus Street
Altamonte Springs, Florida 32714
David A. Kamm -0- --
8191 College Parkway, Suite 202
Ft. Myers, FL 33919
All Directors, Nominees and Officers as --------- ----
a group (8 persons) (2)(3) 4,644,828 63.5%
(1) Newton C. Kindlund and Joanne M. Kindlund, husband and wife, each disclaim
any right to control the other's exercise of shareholders rights with
respect to the Shares including voting the shares of the Common Stock of
the Company set out in the above table.
(2) Includes options exercisable for 125,000 shares of Common Stock issued
under the 1987 Incentive Stock Option Plan.
(3) Includes options exercisable for 10,000 shares of Common Stock, granted
February 20, 1993.
* Less than 1%.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Company held four regularly scheduled
quarterly meetings and a total of six meetings, including committee meetings and
the Annual Shareholders Meeting, in fiscal year ended October 31, 1998. No
Directors attended less than 75% of meetings and committee meetings on which
they serve during the fiscal year.
The Board of Directors has established the following committees:
Executive Committee, Nominating Committee, Audit Committee, and Compensation
Advisory Committee. During fiscal year ended October 31, 1998, the Audit
Committee held one meeting.
<PAGE>
The Executive Committee exercises the powers of the Board of Directors
in the management of the business of the Company during intervals between
meetings of the Board of Directors. The Executive Committee also functions as a
Nominating Committee, and considers nominees recommended by Shareholders or
others for election to the Board of Directors and submits its recommendations to
the Board of Directors from time to time. Shareholders or others may submit, in
writing, the name address (including zip code), telephone number and
biographical information of individuals recommended for membership on the Board
of Directors by the date for submission of Shareholder proposals for the 2000
Annual Meeting to any member of the Nominating Committee at the executive
offices of the Company located at Sand Lake Executive Park, 7851 Greenbriar
Parkway, Orlando, Florida 32819.
The Audit Committee, in consultation with financial officers of the
Company and with the independent certified public accountant, assist in
establishing the scope of the annual audit. The Committee (1) reviews annual and
quarterly financial statements, (2) recommends to the Board of Directors the
appointment of independent certified public accountant, (3) reviews the
Company's annual program of internal audit staff, (4) reviews programs designed
to protect and maintain the assets of the Company, including insurance and
internal security programs. The Committee may also examine and consider such
other matters relating to the financial affairs of the Company and its
subsidiaries as it determines to be desirable.
The Compensation Advisory Committee reviews the personnel affairs of
the Company and the compensation paid by the Company to its personnel, including
recruitment, salaries, stock options, retirement benefits, and any other
employment benefits, award options under the Company's Incentive Stock Option
Plan, and prepares and submits reports and recommendations to the Company's
Board of Directors from time to time, or whenever called upon by the Board of
Directors.
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors of the Company proposes that eight (8) nominees,
whose names appear below, be elected to serve as directors of the Company. Seven
(7) of the nominees are directors of the Company at the present time and were
elected in the fiscal year ended October 31, 1998, by the shareholders of the
Company. Directors will hold office until the next Annual Meeting of
Shareholders and until their successors are elected and qualified. The By-Laws
of the Company provide that the Board of Directors shall consist of ten members.
However, the Board of Directors desires to reduce the number of Directors to
eight to make the Board more effective. Shareholder voting at the meeting cannot
vote for more than eight (8) nominees. Any vacancy created by the resignation of
a Director may be filled for the remainder of the term, which is until the next
Annual Meeting of Shareholders. There is no reason to believe that any nominee
will be unable to serve if elected, and to the knowledge of management all
nominees intend to serve the entire term for which election is sought.
SERVED AS DIRECTOR SINCE
------------------------
Newton C. Kindlund, 58....................................................1978
Mr. Kindlund and his wife, Joanne M. Kindlund, are co-founders of the
Company. He has served as President and Chairman since its inception in July
1978. He is a graduate of Michigan State University having received his B.A. in
1963. He has done postgraduate studies at the Wharton School of the University
of Pennsylvania, Boston College and Indiana University. From 1975 to 1977 he was
a regional Vice President of Recreational Vehicle Industry Association, Elkhart,
Indiana. He was a founder of the Florida RV Trade Association and served on the
Board of Directors of the National Recreation Vehicle Rental Dealers Association
and the Central Florida World Trade Council. Recently Mr. Kindlund has served as
an Executive Board member and on the Executive Committee of the Greater Orlando
Florida Chamber of Commerce. Currently Mr. Kindlund is a member of the National
Dealer Advisory Council for Airstream, Inc., Spartan Motors, Inc., and is past
Chairman of the Board of Directors of the Recreation Vehicle Rental Dealers
Association. Mr. Kindlund was recognized as the RV NEWS RV Executive of the Year
for 1995.
Joanne M. Kindlund, 50.....................................................1978
Mrs. Kindlund, a co-founder of the Company, has served as Executive Vice
President, Secretary and Treasurer and as a Director since its inception in
July, 1978. She graduated from the University of Florida in 1971 with a B.S.
Degree in Advertising and has done postgraduate work at the University of
Florida in accounting and finance. From 1984 to 1985, she assisted Gorman
Planning and Associates, Virginia Beach, Virginia with the creation of software
managerial systems including accounting systems and inventory control systems
for retail recreational vehicle sales dealerships. Mrs. Kindlund was honored by
WORKING WOMEN MAGAZINE as one of the top women executives in 1998.
W. Hardee McAlhaney, 51....................................................1993
Mr. McAlhaney joined the Company as Corporate Comptroller in 1988 and is
currently a Vice President and the Chief Financial Officer of the Company. He
graduated from the University of Tennessee in 1970 with a B.S.B.A. Degree, and
from the University of Florida in 1972 with an M.B.A. Mr. McAlhaney served as
Chief Financial Officer for two national retail chains; The Athletic Attic and
The Athlete's Foot, prior to joining Drexel, Burnham, Lambert as an investment
consultant.
<PAGE>
James P. Williams, 60......................................................1987
Mr. Williams has served on the Board of Directors of the Company since
August of 1987. He received his Bachelor of Science Degree in Business in 1961
from Stetson University. Mr. Williams, since graduation from college, and has
been a practicing accountant having become a Certified Public Accountant in
1967. He is the owner of Williams and Company, CPAs and Consultants and Chief
Financial Officer of Shied Enterprises, Inc., a wealth building and preservation
services company.
Paul G. Clubbe, 57.........................................................1987
Mr. Clubbe attended St. Dunstans College, England, Lisgar Collegiate,
Ottawa, Ontario Canada and Pickering College, Toronto, Ontario Canada. From 1982
to 1995 Mr. Clubbe served as Executive Officer of Rotex Canada, Inc., of
Scarborough, Canada. From 1963 to 1964 Mr. Clubbe was a sales representative for
Morgan Paper Co., Ltd., Toronto, Canada. He is President of Paul Clubbe
(Marketing) Limited and a member of the Board of Directors of Flesherton
Concrete Products, Inc., Paulaurier Sales, Inc.
Roy W. Parker, 55 .........................................................1993
Mr. Parker is Chief Executive Officer and Owner of Parker Boat Company,
Incorporated, the Sea Ray boat dealer for Orlando, Florida. Parker Boats was
founded in 1927. Mr. Parker joined the business in 1964, and became the sole
owner in 1980. Parker Boats has ranked consistently as a top 25 dealer in sales
for Sea Ray. Mr. Parker received the Hall of Fame Award in 1993, presented by
the Marine Retailers Association of America. Mr. Parker also is past President
of the Central Florida Marine Trade Association, and is on the Lakes and
Advisory Board for the City of Maitland, Florida.
Harvey M. Alper, 52........................................................1995
Mr. Alper is a partner of the law firm, Massey, Alper and Walden, P.A.,
Altamonte Springs, Florida. He earned his B.S.J.M. degree (1968) and his JD
(1971) from the University of Florida and has continued his professional
education with several certifications including a certificate in "Comparative
Law" from Oxford University in 1979. Mr. Alper has been engaged in the private
practice of law since 1971, after serving as Assistant General Counsel for the
City of Jacksonville, Florida. Mr. Alper serve as general counsel to the Company
as a partner of the law firm, Alper, Walden, Crichton and Miller.
David A. Kamm, 62........................................................... --
Mr. Kamm is a registered Investment Advisor Representative with Raymond
James and Associates, Ft Myers, Florida. He obtained a BS in electrical
engineering from the University of Illinois and a MBA from Michigan State
University. Mr. Kamm has been in the investment business since 1970 and joined
his present employer in 1977. For the last eighteen years he has published a
weekly column running in numerous Newspapers across the State of Florida - "Take
Stock In Florida".
<PAGE>
PROPOSAL 2
APPROVAL OF INDEPENDENT PUBLIC ACCOUNTANTs
The independent public accountants recommended by the Board of
Directors for fiscal year 1999 is the firm of PricewaterhouseCoopers, LLP.
A representative of the firm will be present at the annual meeting with
the opportunity to make a statement and will respond to appropriate questions.
PROPOSAL 3
RATIFY AND APPROVE THE 1999 - STOCK OPTION PLAN, AND 500,000
SHARES ISSUABLE UNDER THE PLAN
The Company is seeking shareholder approval for the 1999-Stock Option
Plan ("Plan"). The Plan is a replacement for the 1987 Incentive Stock Option
Plan with the principal exception of a provision providing for grants in the
form of not only incentive stock options, as provided under Section 442A of the
Internal Revenue Code of 1986, or in the form of non-qualified stock options.
The 1987 Plan did not provide for granting non-qualified stock options. The Plan
includes 500,000 shares of the Company's common stock, which may be in whole or
in part unissued shares, or shares issued and reacquired by the Company. Upon
approval by the company's shareholders, the Plan shall terminate ten years
thereafter.
The Plan shall be administered by the Compensation Advisory Committee
of the Company's Board of Directors. The incentive options under the plan shall
be limited to persons who have been regular full-time employees of the Company
or its present or future subsidiaries for more than one year on the grant of any
option.
The purchase price of the common stock covered by each option shall be
no less than 100% of the fair market value of a share of the common stock on the
date on which the option is granted. In the case of non-qualified options, the
purchase price under the options shall be generally be fair market value,
although the committee may grant options with option prices of less than fair
market.
The term of each option shall be no more than 10 years from the date of
the grant. No option granted under the plan shall be exercisable prior to the
expiration of one year of its term. An option granted under the plan must be
exercised in full at the earliest of six months after the holders death or the
tenth anniversary of the grant date.
An option may be exercised, at any time, or from time to time, as to
any and all full shares as to which the option has been exercisable until the
expiration of the period set forth in the plan document. The purchase price of
the shares as to which an option is exercised shall be paid in full at time of
the exercise in cash or official bank check, or other instrument acceptable to
the Company. No option granted to any employee may be exercised by such employee
unless such an employee is then a regular full-time employee of the Company or a
subsidiary and unless the employee has remained in the Company's continuous
employment and/or that of its subsidiaries or any combination thereof.
With respect to incentive options, the aggregate fair market value of
the common stock or any other stock of the Company are exercisable for the first
time by any employee during any calendar year, shall not exceed $100,000. An
employee may exercise options for the purchase of common stock valued in excess
of $100,000 in a calendar year, but only if the right to exercise such options
shall have first become available in prior calendar years. No incentive option
may be granted to any employee who immediately prior to the date of the grant of
such incentive option owns more than 10% of the combined voting power of all
classes of stock in the Company, or any of its subsidiaries unless the exercised
price under the incentive option is at least 110% of the fair market value on
the date of the grant and the option expires within five years from the date of
the grant.
<PAGE>
Incentive options under the plan shall not be transferable otherwise
than by will or the laws of the descent and distribution. The incentive options
may be exercised during the lifetime of the employee only by the employee.
In the event that the employment of an employee to whom an option has
been granted under the plan shall be terminated, such option may be exercised at
anytime within three months, or twelve months in the case of permanently and
totally disabled employees, after such termination, but no later than the date
on which the option terminates. If an employee to whom an option has been
granted under the plan shall die while employed by the Company or a subsidiary
within three months after the termination of such employment, such options may
be exercised at any time within six months after the date of the employees
death, but no later than the date on which the option terminates.
The Company's Board of Directors may, at any time, make or provide for
such adjustments to the plan, to the number and class of shares issuable
thereunder, or to any outstanding options that it shall deem appropriate to
prevent dilution or enlargement of the rights.
The plan shall become effective upon approval of the same by the
stockholders of the Company. The Board of Directors of the Company may suspend,
terminate, modify, or amend the plan provided that any amendment that would
increase the aggregate number of shares, which may be issued under the plan,
materially increase the benefits accruing to the participants of the plan, or
materially modify the requirements as to the eligibility for participation in
the plan, shall be subject to approval by the Company's stockholders.
Below find a complete copy of the Plan.
1999-STOCK OPTION PLAN
OF
HOLIDAY RV SUPERSTORES, INCORPORATED
1. NAME OF PLAN. The name of this Stock Option Plan (hereinafter
referred to as the "Plan"), shall be the 1999 - Stock Option Plan of Holiday RV
Superstores, Incorporated, a Florida Corporation, (hereinafter referred to as
the "Company").
2. SCOPE AND DURATION. Options under the 1999 Plan may be granted in
the form of incentive stock options ("Incentive Options") as provided in Section
422A of the Internal Revenue Code of 1986, as amended (the "Code"), or in the
form of non-qualified stock options ("Non-qualified Options"). (Unless otherwise
indicated, references in the 1999 Plan to "options" include Incentive Options
and Non-qualified Options.) The maximum aggregate number of shares as to which
options may be granted from time to time under the 1999 Plan is 500,000 shares
of the Common Stock of the Company ("Common Stock"), which shares may be, in
whole or in part, authorized but unissued shares or shares reacquired by the
Company. If an option shall expire, terminate or be surrendered for cancellation
for any reason without having been exercised in full, the shares represented by
the option or portion thereof not so exercised shall (unless the 1999 Plan shall
have been terminated) become available for subsequent option grants under the
1999 Plan. As provided in Paragraph 13. the 1999 Plan shall become effective
upon the approval of the same by the Company's shareholders, and unless
terminated sooner pursuant to Paragraph 14. the 1999 Plan shall terminate ten
(10) years thereafter, and no option shall be granted hereunder after that date.
3. ADMINISTRATION. The 1999 Plan shall be administered by the
Compensation Advisory Committee of the Company's Board of Directors (the
"Committee"). The Committee shall consist of not less than three members of the
Board of Directors, two (2) of whom shall be "disinterested persons" as defined
in Rule 16b-3 pursuant to the Securities and Exchange Act of 1934, and one of
whom shall be the Company's Chief Financial Officer. The Committee shall have
plenary authority in its discretion, subject to and not inconsistent with the
express provisions of the 1999 Plan, to grant options, to determine the purchase
price of the Common Stock covered by each option, the term of each option, the
persons to whom, and the time or times at which, options shall be granted and
the number of shares to be covered by each option; to designate options as
Incentive Options or Non-qualified Options; to interpret this 1999 Plan; to
prescribe, amend and rescind rules and regulations relating to the 1999 Plan; to
determine the terms and provisions of the option agreements (which need not be
identical) entered into in connection with options under the 1999 Plan; and to
make all other determinations deemed
<PAGE>
necessary or advisable for the administration of the 1999 Plan. The Committee
may delegate to one or more of its members or to one or more agents such
administrative duties as it may deem advisable, and the Committee or any person
to whom it has delegated duties as aforesaid may employ one or more persons to
render advice with respect to any responsibility the Committee or such person
may have under the 1999 Plan.
4. ELIGIBILITY; FACTORS TO BE CONSIDERED IN GRANTING OPTIONS. Incentive
Options shall be limited to persons who have been regular full-time employees of
the Company or its present and future subsidiaries for more than one year and at
the grant of any option are in the employ of the Company or its present and
future subsidiaries. In determining the employees to whom Incentive Options
shall be granted and the number of shares to be covered by each Incentive
Option, the Committee shall take into account the nature of employees' duties,
their present and potential contributions to the success of the Company and such
other factors as it shall deem relevant in connection with accomplishing the
purposes of the 1999 Plan. An employee who has been granted an option or options
under the 1999 Plan may be granted an additional option or options, subject, in
the case of Incentive Options, to such limitations as may be imposed by the Code
on such options. Except as provided below, a Non-qualified Option may be granted
to any person, including, but limited to, employees, independent agents,
consultants and attorneys, the Committee believes have contributed, or will
contribute, to the success of the Company. Directors of the Company who are not
salaried employees of or exclusive, full-time consultants to the Company or its
present and future subsidiaries may not receive options under the 1999 Plan.
5. OPTION PRICE. The purchase price of the Common Stock covered by each
option shall be determined by the Committee and in the case of Incentive Options
shall not be less than 100% of the Fair Market Value (as defined in Paragraph
16., below) of a share of the Common Stock on the date on which the option is
granted. In the case of Non-qualified Options, the purchase price under the
option shall generally be Fair Market Value, although the Committee may grant
options with option prices of less than Fair Market Value. Such price shall be
subject to adjustment as provided in Paragraph 12., below. The Committee shall
determine the date on which an option is granted; in the absence of such a
determination, the date on which the Committee adopts a resolution granting an
option shall be considered the date on which such option is granted.
6. TERM OF OPTIONS. The term of each option shall be not more than ten
(10) years from the date of grant, as the Committee shall determine, subject to
earlier termination as provided in Paragraphs 10. and 11., below.
7. EXERCISE OF OPTIONS.
7.1. Except as provided below, no option granted under the 1999
Plan shall be exercisable prior to the expiration of the first year of its term.
Thereafter, subject to the provision of the 1999 Plan and unless otherwise
provided in the option agreement, an option granted under the 1999 Plan shall
become exercisable in full at the earliest of six (6) months after the holder's
death or the tenth anniversary of the date of grant. In its discretion, the
Committee may, in any case or cases, prescribe the option be exercised in
installments or provide that an option may be exercisable in full immediately
upon the date of its grant (subject, in the case of Incentive Options, to such
restrictions as may be imposed by the Code). The Committee may, in its sole
discretion, provide that an option shall immediately become exercisable in full
upon the happening of any of the following events: (i) the first purchase of
shares of Common Stock pursuant to a tender offer or exchange offer (other than
an offer by the Company) for all, or any part of, the Common Stock, (ii) the
approval by the stockholders of the Company of an agreement for a merger in
which the Company will not survive as an independent, publicly owned
corporation, a consolidation, or a sale, exchange or other disposition of all or
substantially all of the Company's assets, (iii) with respect to an employee, on
his 65th birthday, or (iv) with respect to an employee, on the employee's
involuntary termination from employment. In the event of a question or
controversy as to whether any of the events hereinabove described has taken
place, a determination by the Committee that such event has or has not occurred
shall be conclusive and binding upon the Company and participants in the 1999
Plan.
7.2. An option may be exercised, at any time or from time to time
(subject, in the case of Incentive Options, to such restrictions as may be
imposed by the Code), as to any or all full shares as to which the option has
become exercisable until the expiration of the period set forth in Section 6
hereof, by the delivery to the Company, at its principal place of business in
Orlando, Florida, of (i) written notice of exercise in the form specified by the
Committee specifying the number of shares of Common Stock with respect to which
the option is being exercised and signed by the person exercising the option as
provided herein, (ii) payment of the purchase price; and (iii) in the case of
Non-qualified Options, payment in cash of all withholding tax obligations
imposed on the Company by reason of the exercise of the option.
<PAGE>
Upon acceptance of such notice, receipt of payment in full, and receipt of
payment of all withholding tax obligations, the Company shall cause to be issued
a certificate representing the shares of Common Stock purchased. In the event
the person exercising the option delivers the items specified in (i) and (ii) of
this Subsection 7.2., but not the item specified in (iii) hereof, if applicable,
the option shall still be considered exercised upon acceptance by the Company
for the full number of shares of Common Stock specified in the notice of
exercise but the actual number of shares issued shall be reduced by the smallest
number of whole shares of Common Stock which, when multiplied by the Fair Market
Value of the Common Stock as of the date the option is exercised, is sufficient
to satisfy the required amount of withholding tax.
7.3 The purchase price of the shares as to which an option is
exercised shall be paid in full at the time of exercise. Payment shall be made
in cash, which may be paid by cashiers or official bank check or other
instrument acceptable to the Company; in addition, subject to compliance with
applicable laws and regulations and such conditions as the Committee may impose,
the Committee, in its sole discretion, may on a case-by-case basis elect to
accept payment in shares of Common Stock of the Company which are already owned
by the option holder, valued at the Fair Market Value thereof (as defined in
Paragraph 15., below) on the date of exercise; provided, however, that with
respect to Incentive Options, no such discretion may be exercised unless the
option agreement permits the payment of the purchase price in that manner.
7.4. Except as provided in Paragraphs 10. and 11., below, no
option granted to an employee may be exercised at any time by such employee
unless such employee is then a regular full-time employee of the Company or a
subsidiary and unless the employee has remained in the continuous employ of the
Company, any of its subsidiaries or any combination thereof, for a period of one
(1) year from the date of its grant.
8. INCENTIVE OPTIONS.
8.1 With respect to Incentive Options granted, the aggregate Fair
Market Value (determined in Accordance with the provisions of Paragraph 15. at
the time the Incentive Option is granted) of the Common Stock or any other stock
of the Company, its parent or subsidiary corporations with respect to which
incentive stock options, as defined in Section 422A of the Code, are exercisable
for the first time by any employee during any calendar year (under all incentive
stock option plan of the Company and its parent and subsidiary corporations, as
those terms are defined in Section425 of the Code) shall not exceed $100,000. An
employee may exercise options for the purchase of Common Stock valued in excess
of $100,000 (determined in accordance with the provisions of Paragraph 15. at
the time the Incentive Option is granted) in a calendar year, but only if the
right to exercise such options shall have first become available in prior
calendar years.
8.2. No Incentive Option may be awarded to any employee who
immediately prior to the date of the granting of such Incentive Option owns more
than 10% of the combined voting power of all classes of stock of the Company or
any of its subsidiaries unless the exercise price under the Incentive Option is
at least 110% of the Fair Market Value on the date of the grant and the option
expires within five (5) years from the date of grant.
8.3. In the event of amendments to the Code or applicable
regulations relating to Incentive Options subsequent to the date hereof, the
Company may amend the provisions of the 1999 Plan, and the Company and the
employees holding options may agree to amend outstanding option agreements, to
conform to such amendments.
9. NON-TRANSFERABILITY OF OPTIONS. Incentive Options granted under the
1999 Plan shall not be transferable otherwise than by will or the laws of
descent and distribution, and Incentive Options may be exercised during the
lifetime of the employee only by the employee.
10. TERMINATION OF EMPLOYMENT. In the event that the employment of an
employee to whom an option has been granted under the 1999 Plan shall be
terminated (except as set forth in Paragraph 11., below), such option may be,
subject to the provisions of the 1999 Plan, exercised (to the extent that the
employee was entitled to do so at the termination of his employment) at any time
within three (3) months (twelve (12) months in the case of a permanently and
totally disabled employee) after such termination, but not later than the date
on which the option terminates; provided, however that any option which is held
by an employee whose employment is terminated for cause shall, to the extent not
therefore exercised, automatically terminate as of the date of termination of
employment. As used herein, "cause" shall mean conduct amounting to fraud,
dishonesty, negligence, or engaging in competition or solicitations in
contradiction and breach of any applicable employment agreement between the
Company and Holder.
<PAGE>
Options granted to employees under the 1999 Plan shall not be affected
by any change of duties or position so long as the Holder continues to be a
regular full-time employee of the Company or any of its subsidiaries. An option
agreement or any rules and regulations relating to the 1999 Plan may contain
such provisions as the Committee shall approve with reference to the
determination of the date employment terminates and the effect of leaves of
absence. Nothing in the 1999 Plan or in any option granted pursuant to the 1999
Plan shall confer upon any employee any right to continue in the employ of the
Company or any of its subsidiaries or interfere in any way with the right of the
Company or any such subsidiary to terminate such employment at any time.
11. DEATH OF EMPLOYEE. If an employee to whom an option has been granted
under the 1999 Plan shall die while employed by the Company or a subsidiary or
within three (3) months after the termination of such employment (other than
termination for cause), such option may be exercised, to the extent exercisable
by the employee on the date of death, by a legatee or legatees of the employee
under the employee's last will, or by the employee's personal representatives or
distributes, at any time within six (6) months after the date of the employee's
death, but not later than the date on which the option terminates.
12. ADJUSTMENT UPON CHANGES IN CAPITALIZATION, ETC. Notwithstanding any
other provision of the 1999 Plan, the Company's Board of Directors may, at any
time, make or provide for such adjustments to the 1999 Plan, to the number and
class of shares issuable thereunder or to any outstanding options that it shall
deem appropriate to prevent dilution or enlargement of rights, including
adjustments in the event of changes in the outstanding Common Stock by reason of
stock dividends, split-ups, recapitalization, mergers, consolidations,
combinations or exchanges of shares, separations, reorganizations, liquidations
and the like. In the event of any offer to Holders of Common Stock generally
relating to the acquisition of their shares, the Company's Board of Directors
may make such adjustment as it deems equitable in respect of outstanding options
and rights, including in its discretion revision of outstanding options and
rights so that they may be exercisable for the consideration payable in the
acquisition transaction. Any such determination by the Board of Directors shall
be conclusive. Any fractional shares resulting from such adjustments shall be
eliminated.
13. EFFECTIVE DATE. The 1999 Plan shall become effective upon approval
of the same by the stockholders of the Company. Subject to such approval, the
1999 Plan is effective at once. Options may be granted under the 1999 Plan prior
to such approval, but each such option shall be subject to the approval of the
1999 Plan by the stockholders of the Company. If the 1999 Plan shall not be so
approved, all options granted thereunder shall be of no effect. The date of
grant of any option granted prior to such approval by the stockholders shall be
determined for all purposes as if the option had not been subject to such
approval; provided, however, no option granted under the 1999 Plan may be
exercised prior to the approval of the 1999 Plan by the Company's stockholders.
14. TERMINATION AND AMENDMENT. The Board of Directors of the Company may
suspend, terminate, modify or amend the 1999 Plan, provided that any amendment
that would increase the aggregate number of shares which may be issued under the
1999 Plan, materially increase the benefits accruing to participants under the
1999 Plan, or materially modify the requirements as to eligibility for
participation in the 1999 Plan, shall be subject to the approval of the
Company's stockholders, except that any such increase or modification that may
result from adjustments authorized by Paragraph 12. does not require such
approval. No suspension, termination, modification or amendment of the 1999 Plan
may, without the consent of the employee to whom an option shall theretofore
have been granted, affect the rights of such employee under such option.
15. MISCELLANEOUS. As said term is used in the 1999 Plan, the "Fair
Market Value" of a share of Common Stock on any day means: (a) if the principal
market for the Common Stock is a national securities exchange or the NASDAQ
National Market System, the closing sales price of the Common Stock on such day
as reported by such exchange or market system, or on a consolidated tape
reflecting transactions on such exchange or market system, or (b) if the
principal market for the Common Stock is not a national securities exchange and
the Common Stock is quoted on the National Association of Securities Dealers
Automated Quotations System, the mean between the closing bid and the closing
asked prices for the Common Stock on such day as quoted on such System, or (c)
if the principal market for the Common Stock is not a national securities
exchange and the Common Stock is not quoted on the National Association of
Securities Dealers Automated Quotations System, the mean between the highest bid
and lowest asked price for the Common Stock on such day as reported by the
National Quotation Bureau, Inc.; provided, that if clauses (a), (b) and (c) of
this paragraph are all inapplicable, or if no trades have been made or no quotes
are available for such day, the Fair Market Value of the Common Stock shall be
determined by the Committee and such determination shall be conclusive as to the
Fair Market Value of the Common Stock.
<PAGE>
The Committee may require, as a condition to the exercise of any options
granted under the 1999 Plan, that at the time of exercise, (i) the shares of
Common Stock reserved for purposes of the 1999 Plan shall be duly listed, upon
official notice of issuance, upon stock exchange(s) on which the Common Stock is
listed, (ii) a Registration Statement under the Securities Act of 1933, as
amended, with respect to such shares shall be effective, and/or (iii) the person
exercising such option deliver to the Company such documents, agreements and
investment and other representations as the Committee shall determine to be in
the best interest of the Company. If the shares of Common Stock being acquired
upon the exercise of an option have not been registered by the Company, the
Company shall have the right to place a restrictive legend on said shares of
Common Stock reflecting that such shares were issued under an exemption from
registration and transfer of the same will require registration or an opinion of
counsel satisfactory to the Company that such transfer is exempted from
registration.
IN WITNESS WHEREOF, the undersigned have set their hands and seals this
___ day of _________, 1999.
HOLIDAY RV SUPERSTORES, INC.,
a Florida Corporation
By:
--------------------------------------
Newton C. Kindlund, President
Attest:
----------------------------------
Joanne M. Kindlund, Secretary
(CORPORATE SEAL)
<PAGE>
OTHER INFORMATION
EXECUTIVE COMPENSATION
The table below sets forth the cash compensation including salaries,
bonuses, contributions to retirement plans, premium paid on health and dental
insurance plans and disability insurance plans, paid by the Company for the
years ended October 31, 1998, 1997, and 1996, to, or for the benefit of, each
executive officer whose aggregate cash compensation by the Company exceeded
$100,000 for the Fiscal year ended October 31, 1998, and the CEO regardless of
compensation level.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
- --------------------------------------------------------------------------------------------------------------------------------
Long-Term
Annual Compensation
Compensation -------------------
Awards Awards
--------------------------------- --------------------
Name and Restricted Stock
Principal Position Year Salary (1) Bonus (2) Other Stock Options(3) Other(4)
------------------------------------- --------- ----------- ------------ -------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Newton C. Kindlund 1998 $108,847 --- --- --- --- ---
Chairman, President 1997 $107,587 --- --- --- --- ---
Chief Executive 1996 $107,564 --- --- --- --- ---
W. Hardee McAlhaney 1998 $80,196 $75,002 --- --- --- $597
Vice President 1997 $81,437 $52,477 --- --- --- $597
Chief Financial Officer 1996 $80,850 $53,785 --- --- --- $597
------------------------------------- --------- ---------------- ------------ ----------- ----------------------------------------
</TABLE>
(1) Includes contributions by the Company pursuant to an employee benefit plan
established under Section 401(k) of the Internal Revenue Code in the
amounts of $2,859, $3,181 and $3,167 for Mr. Kindlund for 1998, 1997 and
1996 respectively, and $4,549, $4,027 and $3,450 for Mr. McAlhaney for
1998, 1997 and 1996 respectively.
(2) Mr. McAlhaney's bonus is based on the Company's net income before taxes.
(3) The Company pays a part of the premium on a term life insurance policies
for Mr. McAlhaney whose sole beneficiary is designated by the insured. The
policies have no cash surrender value provisions.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning stock option grants made
in the fiscal year ended October 31, 1998, to the individuals named in the
Summary Compensation Table. There were no grants of options or SARs to said
individuals during the year.
<TABLE>
<CAPTION>
Individual Grants Potential Realizable Value at
----------------------------------------------------------- Assume Annual Rates of Stock
Number of % of Total Price Appreciation for Option
Securities Options Exercise
Underlying Granted to or Base Term
Options Employee Price Expiration ------------------------
Name Granted (#) In FY ($/sh) Date 5%($) 10% ($)
---- ------------ ----------- -------- ---------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Newton C. Kindlund --- --- --- --- --- ---
W. Hardee McAlhaney --- --- --- --- --- ---
- ---------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
The following table sets forth information concerning the number and value
realized as to options exercised during Fiscal 1998 and options held at October
31, 1998, by the individuals named in the Summary Compensation Table and the
value of those options held at such date. There were no options exercised during
Fiscal 1998 and no SARs were held at year end.
<TABLE>
<CAPTION>
Number of Securities Value of unexercised
Value Underlying Unexercised In-The-Money Options
Shares Realized Options at FY-End (#) FY-END ($) (1)
Acquired on --------------------------- --------------------------
Name Exercise (#) $ Exercisable Unexercisable Exercisable Unexercisable
- ----- -------------- ---------- ----------- -------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Newton C. Kindlund -- -- -- -- -- --
W. Hardee McAlhaney -- -- 125,000 -- 59,200 --
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Based on a price of $2.25 per share, being the closing price of Common Stock
on October 31, 1998.
DISCRETIONARY AND INCENTIVE BONUSES
The Board of Directors awards discretionary cash bonuses to executive
officers and other employees each year. Bonuses have been paid under various
informal arrangements that have provided for the payment of stipulated amounts
to certain executive officers ratably during the fiscal year, fiscal year end
bonuses to certain executive officers and to marketing and sales support
personnel.
The Company has established an incentive bonus program for its employees with
bonuses generally paid monthly or annually. Bonuses are primarily based upon net
pre tax profits from the various profit centers within each dealership and is
contingent upon continued employment with the company.
DIRECTORS FEES
Directors, who are not salaried employees of the Company, receive $500 for
their attendance at each meeting of the Board of Directors, and annual
Shareholders Meeting and $175 for their attendance at each committee meeting.
The Directors are reimbursed for their travel, lodging and food expense incurred
when attending such meetings, if such meetings are held in a location in excess
of twenty five (25) miles from the principal place of business of the Company in
Orlando, Florida. Directors are also reimbursed for their travel, lodging and
food expenses incurred when traveling on behalf of the Company when requested to
do so by an officer of the Company or by the Board of Directors.
DIRECTORS OPTIONS
Each outside Director serving on the Board as of February 20, 1993 was granted
an option for 10,000 shares of common stock of the Company, exercisable after
February 20, 1995. The exercise price was $1.81 per share, the price of the
Company's Common stock at the time of the grant. A total of five (5) options
were granted, one to each of five Directors (total of 50,000 shares).
EMPLOYEE BENEFIT PLANS
The Company maintains a tax qualified, Profit Sharing and 401(k) Employee
Investment Plan, (Plan). All employees who have attained 21 years of age and
complete one year of service are eligible to participate in the Plan. Plan
participants must complete at least two (2) years of service to begin partial
vesting with total vesting occurring when a Plan participant has completed five
and one half (5 1/2) years of service to the Company. Normal retirement age
under the retirement Plan is 65 years. The Plan fiscal year ends October 31st.
In Fiscal 1998 $98,427 was contributed to the Plan for the
benefit of 140 Plan participants. In Fiscal 1997 $86,349 was contributed to the
Plan for the benefit of 115 Plan participants.
<PAGE>
Prudential Bank and Trust Company (One Ravinia Drive, Ste. 1000, Atlanta, GA
30346, 770-551-6700), is the trustee. The Company is the plan administrator.
The Plan document provides for contributions at the discretion of the Board
of Directors, to be allocated to each Plan participant in an amount not greater
than 10% of each participant's compensation subject to the annual contribution
(1) limitation of the top heavy rules. Under the Plan, compensation is broadly
defined to include wages, salaries, bonuses, overtime and commissions. Amounts
contributed to the Plan by the Company for the 1998, 1997 and 1996 Plan years on
behalf of the named individuals are included in the Executive Compensation
Table, of this report are included in said table.
1987 INCENTIVE STOCK OPTION PLAN
In August 1987, the Board of Directors of the Company adopted the 1987
Incentive Stock Option Plan (the "ISO Plan") which provides that the Company may
grant to officers and managerial employees of the Company and its subsidiaries
incentive stock options. The purpose of the ISO Plan is to provide the Company
with a means of attracting, retaining and increasing the incentive of officers
and managerial employees by offering them the opportunity to invest in, or
increase their investment in, the Company. Options under the ISO Plan are
designed to qualify under Section 422A of the Internal Revenue Code of 1986. The
ISO Plan terminated in August, 1997.
The ISO Plan is administered by the Compensation Advisory Committee of the
Board of Directors (the "Committee") which may grant options to purchase up to
an aggregate of 280,000 shares of Common Stock. The option exercise price must
be at least 100% of the fair market value per share of Common Stock on the date
of grant. The options are exercisable, as determined by the Committee, over a
period of time, but not more than ten years from the date of grant. Any option
granted to an employee shall lapse following his termination of employment;
provided, however, that in the discretion of the Committee, the employee shall
have up to three (3) months following his termination of employment to exercise
his options and provided, further, that upon the employee's permanent and total
disability, any option granted to him may be exercised within twelve months
following his termination of employment because of such disability. The ISO Plan
provides for certain anti-dilution adjustments upon the occurrence of certain
events.
Five separate options for 25,000 shares each have been granted to W. Hardee
McAlhaney, Vice President, Chief Financial Officer of the Company, and a
Director of the Company. The options were approved by the Board of Directors on
the following dates and at the following option exercise prices:
DATE SHARES EXERCISE PRICE
-------- ------ --------------
May 23, 1994 25,000 $1.819
February 20, 1993 25,000 $1.813
March 24, 1992 25,000 $1.375
November 17, 1990 25,000 $1.625
May 14, 1990 25,000 $2.500
-------
125,000
BONUS STOCK
In September 1987, the Company issued 250,000 Shares of Common Stock to
various individuals including officers, directors and employees of the Company
for services rendered. These shares have certain restrictions and forfeiture
provisions attached to them. Since September 1987, a number of recipients of
such shares have terminated their employment with the Company resulting in their
bonus shares of Common Stock being forfeited to the Company. After September
1987, the Company made additional awards of bonus shares to employees; however,
no shares in excess of the initial 250,000 shares have been issued since
forfeited shares equaled or exceeded the number of bonus shares issued by the
Company to employees subsequent to such date. beginning with the year ended
October 31, 1987, and over a period of two to five years the value of these
shares will be a charge against earnings of the Company. The Company valued the
shares initially issued at 50% of the initial public offering price of its
shares of common stock or $1.25. Shares issued subsequent to September 1987 were
valued at 100% of the market value on the day of issue.
<PAGE>
The amount of shares awarded and fair market value assigned to the shares for
the last three Fiscal years are as follows:
BONUS STOCK
--------------------------------------------------------------------------
Number Shares Fair Market Value
Fiscal Year Awarded at time of Award
--------------------------------------------------------------------------
1998 --- $ ---
1997 5,000 $11,250
1996 7,500 $14,063
--------------------------------------------------------------------------
The bonus stock awards listed above require a two (2) year vesting and
employment period. As of October 31, 1998, 218,700 shares had been
granted pursuant to the plan.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Board of Directors Compensation Advisory Committee membership
for Fiscal 1998 included Messrs. W. Hardee McAlhaney, James P. Williams and Roy
W. Parker. Mr. McAlhaney is the Vice President and Chief Financial Officer of
the Company.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and other persons who own more than ten
percent (10% of the registered class of the company's equitiy securities, to
file reports of ownership on Form 3 and changes in ownership on Form 4 or 5 with
the Securities and Exchange Commission (Section 16(a)) and the exchange on which
the Company's securities trade. Such officers and directors and ten percent
(10%) shareholders are also required by SEC rules to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on its review of copies of such reports received from certain
reporting persons, the Company believes that all it's directors, executive
officers and ten percent (10) stockholders complied with all Section 16(a)
filing requirements during the fiscal year ended October 31, 1998.
BOARD COMPENSATION ADVISORY COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Advisory Committee of the Board of Directors of Holiday RV
Superstores, Inc. consists of two outside Directors and the Chief Financial
Officer of the Company. The Committee has the responsibility to recommend to the
Board how to administer the Company's Incentive Stock Option Plan, awarding the
Company's bonus shares of Common Stock and determining the compensation of the
Company's three executive officers. This report focuses primarily on the
Company's philosophy with respect to the executive officers compensation and
approach the Committee has taken thus far and intends to take in the future with
respect to relating compensation to performance of the Company.
From the inception of the Company, its corporate philosophy concerning
compensation has been to minimize guaranteed fixed compensation in favor of
incentive compensation which increases when the Company's performance is strong
and declines when it is poor. Incentive compensation, or bonuses tied to
prescribed formulas, is pervasive throughout the Company's managerial structure.
Such bonuses can be as much as 100% or more of any employee's base salary.
Dealership general managers and departmental managers receive an incentive bonus
based on the profitability of their respective dealerships or departments. In
addition, dealership general managers are paid a year end bonus based on their
respective stores achieving a pre determined agreed upon annual income target,
usually the budgeted net pretax income for their dealership.
<PAGE>
The corporate officers receive a base salary which is expected to be
sufficient to support a reasonable minimal managerial lifestyle. The President
has a guarantee base annual salary of $125,000. The Secretary/Treasurer has the
base guaranteed annual salary of $87,500, and the Vice President and Chief
Financial Officer has a base guaranteed annual salary of $75,000. The
President's base was increased from $102,000, and the Secretary/Treasurer's base
from $75,000 by vote of the Board of Directors at the February 20, 1999 meeting.
Upon the recommendation by the Committee to the Board. The Committee
recommended, and the Board also approved the incentive Quarterly bonus for the
President based on the Company's net pretax income. These changes in the
compensation of the President and Secretary/Treasurer were recommended by the
Committee to more fairly compensate them for the level of responsibility they
have within the Company, and to raise their total compensation to an amount more
in-line with officers of other companies of similar size to that of the Company.
The CFO also receives an incentive quarterly bonus based on the company's net
pretax income.
The Board of Directors has viewed its incentive stock option program as
providing its executive officers, who have the greatest degree of control over
the Company's marketing cost control and long range planning, with the
opportunity to receive additional compensation if the price of the Company's
common stock appreciates significantly over the long term.
To date, the Board of Directors has awarded only the Vice President and CFO
of the Company five (5) incentive stock options, under the Company's Incentive
Stock Option Plan. Each option exercise price was at 100% of the fair market
value per share of the common stock on the date of grant. The 1987 Incentive
Stock Option Plan expired. The 1999-Stock Option Plan, to be ratified and
approved by the shareholders at the 1999 Annual Meeting, provides for awards at
the discretion of the Board of Directors upon the recommendation of the
committee and are determined on an annual basis.
The Board of Directors has viewed its awarding of the Company's bonus stock
as a means to help recipients of the stock to focus on the performance of its
common stock and afford it's bonus stock recipients the opportunity for
financial rewards as the stock appreciates. To date, the Committee has awarded
in excess of 200,000 shares of bonus stock to more than ninety recipients.
The Committee's role will be to continue to recommend to the Board how to
administer both the Incentive Stock Option Plan and the Bonus Stock Plan, to
determined participants and recommend to the Board of Directors awards, in all
cases based on recommendations from the executive management of the Company. The
Committee will periodically review the various compensation plans to insure the
plans are consistent with the Company's overall philosophy and to continue to
make recommendations to the Board of Directors on such plans. The Committee will
focus primarily on the Company's executive officers compensation plans, leaving
the compensation of the store managerial personnel to the executive officers of
the company.
James P. Williams Roy W. Parker W. Hardee McAlhaney
CUMULATIVE TOTAL SHAREHOLDER RETURN
The cumulative total shareholder return performance graph as of October 31,
1994, 1995, 1996, 1997 and 1998, for the Company, the Small Cap 600 Index, and
for the Company's peer group, is submitted as Exhibit A at the end of this
Notice.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In November 1994, the Company renewed a five year lease agreement with
Newton C. Kindlund and Joanne M. Kindlund, husband and wife, whereby the Company
leases the real property upon which its dealership is located in Orlando,
Florida. The annual rent is currently $144,000 and, in addition thereto, the
Company pays the real estate taxes, insures the interest of Mr. and Mrs.
Kindlund against casualty loss, pays for all repairs to the property and names
Mr. and Mrs. Kindlund as co-insured under its general liability insurance
policy.
<PAGE>
The lease provides for a cost of living increase for each year of the lease
beginning with the second lease year. The term of the lease agreement expires on
October 31, 1999. In fiscal year 1998, the Company paid to or for the benefit of
Mr. and Mrs. Kindlund $144,000 for the use of these premises.
In May 1997, the Company signed a five year lease agreement with a property
trust for which the beneficiaries are Mr. Kindlund's heirs, whereby the Company
leases the real property upon which its retail center is located in Ft. Myers,
Florida. The annual rent is $59,375 and, in addition thereto, the Company pays
the real estate taxes, insures the interest of the trust against casualty loss,
pays for all repairs to the property and names the property trust as the insured
under its general liability insurance policy. The term of the lease expires on
April 30, 2002. In fiscal, 1998, the company paid to or for the benefit of the
property trust $59,375 for the use of the premises.
Based on current market rates for properties similar to those listed above,
transactions with Mr. and Mrs. Kindlund related to the lease for the Orlando
property were on terms comparable to those which would have been reached with
unaffiliated parties.
Harvey M. Alper, a Director of the Company serves as general counsel of the
Company as a partner of the law firm, Alper, Walden, Chrichton and Miller. In
1998 the Company paid $68,223 to Mr. Alper's firm for legal services.
OTHER BUSINESS WHICH MAY PROPERLY COME BEFORE THE MEETING
The Board of Directors of the Company knows of no business which comes
before the meeting except that indicated above. However, if other business is
brought before the meeting, it will be acted upon accordingly.
DATE FOR SUBMISSION OF SHAREHOLDERS PROPOSALS FOR 2000 ANNUAL MEETING
Shareholder proposals in order to be timely submitted for inclusion in the
information statement or proxy materials for the 2000 annual meeting of
shareholders, must be received at the Company's executive offices by December
31, 1999.
A COPY OF THE COMPANY'S 1998 ANNUAL REPORT (FORM 10-K) AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, MAY BE ACCESSED FROM THE COMPANY'S WEB PAGE ON THE INTERNET
AT HOLIDAYRV.COM.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
By Order of the Board of Directors.
<PAGE>
EXHIBIT A
PERFORMANCE GRAPH
Here in displays a line graph plotting three (3) series of points, whereby
the Y axis is the total cumulative shareholder return, and the X axis is the
year, being 1993 thru 1999. The plotted points (cumulative shareholder return by
year) are listed in the table below
1993 1994 1995 1996 1997 1998
---------------------- ------ ------ ------ ------ ------ ------
RVEE 100.00 63.16 126.32 76.29 64.46 94.74
---------------------- ------ ------ ------ ------ ------ ------
S&P 500 100.00 96.58 117.02 140.96 186.02 165.45
---------------------- ------ ------ ------ ------ ------ ------
PEER GROUP 100.00 98.86 78.17 80.57 75.98 96.39
---------------------- ------ ------ ------ ------ ------ ------
The performance graph above illustrates the cumulative yearly shareholder
return for the past five years, assuming a $100 investment on October 31, 1993,
in (1) the Company; (RVEE) (2) The Standard and Poor's Small Cap 600 index,
assuming reinvestment of dividends; (3) a Company determined Market
Capitalization Peer Group composite index, assuming reinvestment of dividends.
The Company changed, effective with the 1998 graph, the board-market index
from the Standard and Poor's 500 composite index to the Standard and Poor's
Small Cap 600 index. The Company believes the Small Cap index is more comparable
than the 500 composite index to the Company's business sector and market
capitalization size.
The Peer Group consist of twenty publicly owned retail companies with similar
market capitalization as Holiday RV Superstores, Inc., whose common stocks are
traded on exchanges. The market capitalization criteria in determining a peer
group was selected by the Company for shareholder return comparative purposes,
as there is no published industry or line-of-business index comparable to the
industry or line-of-business as that of the Company.
The peer group consist of the following companies:
Audio King Corp., Brendles Inc., Chariot Entertainment Inc. (no longer
files as of 9/18/95), Evans Inc., FFP Partners LP-CL, A., Foodarama
Supermarkets, Harold's Stores Inc., Hills Department Stores Inc., Holiday RV
Superstores, Inc., Huffman Koos Inc. (acquired by Bruener's Home Furn. Co., Oct.
'95), Pubco Corp., Seaway Food Town Inc., Siebert Financial Corp., Sound Advice
Inc., Spec's Music Inc., Strober Organization Inc. (acquired by Hamilton NY,
March '97), Sunshine-Jr Stores (acquired by E-Z Serve Corp. July '95), Uni-Marts
Inc. CL A, Village Super Market CL A, Warehouse Club Inc. (no longer files as of
3/18/96) .
