SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
INFRACORPS INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) No fee required
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act 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>
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
INFRACORPS INC.
7400 Beaufont Springs Drive, Suite 415
Richmond, Virginia 23225
Solicitation of the enclosed proxy is made by and on behalf of the Board of
Directors (the "Board of Directors") of InfraCorps Inc. (the "Company") to be
used at the Annual Meeting of Shareholders to be held at the Omni
Charlottesville Hotel, 235 West Main Street, Charlottesville, Virginia 22902 on
Monday July 26, 1999, at 10:00 a.m., local time, and at any adjournments
thereof. The date on which this Proxy Statement and accompanying Proxy are first
being mailed is July 9, 1999.
The cost of the solicitation of proxies will be borne by the Company.
Solicitations will be made by use of the mails, except that, if necessary,
officers, directors, employees and agents of the Company or of its subsidiaries
may solicit proxies by telephone, telegram, facsimile or personal contact. It is
contemplated that brokerage houses and nominees will be requested to forward
proxy solicitation materials to the beneficial owners of the stock held of
record by such persons, and the Company will reimburse them for their reasonable
charges and expenses in this connection. The Company does not anticipate that
the cost of proxy solicitation will exceed $5,000.
All properly executed proxies delivered pursuant to this solicitation will be
voted at the Annual Meeting in accordance with the instructions thereupon, or,
in the absence of such instructions, in accordance with the Board of Director's
recommendations. Any person signing and mailing the enclosed proxy may,
nevertheless, revoke the proxy at any time prior to the actual voting thereof by
attending the Annual Meeting and voting in person, by providing written notice
of revocation of the proxy, or by submitting a signed proxy bearing a later
date. Any written notice of revocation should be sent to the attention of the
Secretary of the Board at the address above.
A copy of the Company's 1999 Annual Report to Shareholders is being mailed
concurrently with this Proxy Statement, but should not be considered proxy
solicitation material.
The Company has only one class of stock outstanding. The Company has fixed
the close of business on June 15, 1999, as the record date for determination of
shareholders entitled to notice of and to vote at the Annual meeting or any
adjournments thereof. As of June 15, 1999, there were outstanding 16,492,043
shares of Company common stock, no par value ("Common Stock"). Each share
entitled to one vote on each matter to be voted on at the Annual Meeting.
The holders of shares of Common Stock entitled to cast a majority of the
votes at the Annual Meeting constitute a quorum. If a share is represented for
any purpose at the Annual Meeting, it is deemed to be present for the purpose of
establishing a quorum. Abstentions and shares held of record by a broker or its
nominee ("Broker Shares") which are voted on any matter are included in
determining the number of shares present or represented at the Annual Meeting.
Conversely, Broker Shares that are not voted on any matter will not be included
in determining whether a quorum is present. If a quorum is established,
directors will be elected by a plurality of votes cast in person or by proxy at
the Annual meeting (Proposal No. 1). Votes that are withheld and Broker Shares
that are not voted in the election of directors will not be included in
determining the number of votes cast for that matter.
1
<PAGE>
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of June 15, 1999, the beneficial ownership
of each shareholder known to management of the Company to own beneficially more
than 5% of the outstanding Common Stock. Unless otherwise indicated, the Company
believes that the named persons have sole voting and investment power with
respect to all shares of Common Stock shown as beneficially owned by them.
Name of Amount and Nature Percent
Beneficial Owner of Beneficial Ownership Class
- ---------------- ----------------------- -------
Roberta Greiner 858,500 5.2%
5515 Village Drive
Roanoke, VA 24014
Dr. Allen Kahn 3,806,001 (1) 21.1%
55 E. Washington St., Suite 2117
Chicago, IL 60602
Coleman S. Lyttle 1,303,000 (2)(3) 7.8%
2210 Belt Boulevard
Richmond, VA 23224
James B. Quarles 910,000 (8) 5.2%
7400 Beaufont Springs Dr., Suite 415
Richmond, VA 23225
Thomas W. Marmon 1,547,638 (4)(5) 9.1%
4390 Airwest Drive, SE
Grand Rapids, MI 49512
John W. Winfield, The InterGroup 1,215,300 (7) 7.4%
Corporation and Santa Fe Financial
Corporation (6)
2121 Avenue of the Start, Suite 2020
Los Angeles, CA 90067
- --------------
(1)Includes 1,525,000 shares issuable upon exercise of warrants and conversion
of preferred shares as follows: 25,000 shares pursuant to warrants and
1,500,000 shares pursuant to the conversion of preferred shares.
(2)Includes 320,000 shares issuable upon the exercise of options as follows:
20,000 shares pursuant to the 1994 Nonstatutory Option Plan, 100,000 shares
pursuant to the 1995 Nonstatutory Option Plan, 100,000 shares pursuant to the
1997 Nonstatutory Option Plan and 100,000 shares issuable upon conversion of
preferred shares.
(3)Does not include shares in the name of the Estate of Stamie E. Lyttle, of
which Coleman Lyttle is executor, and certain trust created thereby of which
he is trustee. Mr. Lyttle is not a beneficiary of the Estate or the
beneficial owner of shares of Common Stock owned by the Estate or by any such
trust.
(4)Includes 533,350 shares issuable upon the exercise of options and warrants
as follows: 100,000 shares pursuant to the 1995 Nonstatutory Option Plan,
100,000 shares pursuant to the 1997 Nonstatutory Option Plan and 333,350
shares pursuant to warrants.
(5)Includes shares registered in the name of Thomas W. Marmon Trust.
(6)Mr. Winfield is the Chairman, president and Chief Executive Officer of The
InterGroup Corporation ("InterGroup") and Santa Fe Financial Corporation
("Santa Fe"), and is the controlling shareholder of InterGroup. InterGroup
owns approximately 41% of Santa Fe, and Mr. Winfield, as an individual, owns
3.7% of Santa Fe. In his capacity as Chairman, President and Chief Executive
Officer of InterGroup and Santa Fe, Mr. Winfield may be deemed to have voting
and dispositive power of shares of Company common Stock held by InterGroup
and Santa Fe.
2
<PAGE>
(7)Based on information contained in the Schedule 13D of Mr. Winfield,
InterGroup and Santa Fe dated January 5, 1998, the Company believes that: (I)
Mr. Winfield has sole voting and dispositive power with respect to 415,300
shares of Company Common Stock; (ii) Mr. Winfield may be deemed to have
shared voting and dispositive power with respect to 600,000 shares of Company
Common Stock, which include 500,000 shares held by InterGroup and 100,000
shares held by Santa Fe; and (iii) Mr. Winfield has not voting power but may
be deemed to have shared dispositive power with respect to 200,000 shares of
Company Common Stock held by members of Mr. Winfield's family.
(8)Mr. Quarles' shares are issuable upon the exercise of options as follows:
810,000 shares pursuant to the 1995 Nonstatutory Option Plan and 100,000
shares pursuant to the 1997 Nonstatutory Option Plan.
STOCK OWNERSHIP OF MANAGEMENT
The following table sets forth, as of June 15, 1998, certain information
regarding the beneficial ownership of Company Common Stock by each director and
director nominee of the Company, by each executive officer of the Company, and
by all directors and executive officers as a group. Unless otherwise indicated,
the Company believes that the named persons have sole voting and investment
power with respect to all outstanding shares of Common Stock shown as
beneficially owned by them.
Name of Amount and Nature Percent
Beneficial Owner of Beneficial Ownership Class
- ---------------- ----------------------- -------
Terence R. Dellecker (1) 100,000 (3) 0.6%
75 Rue De Courcelles
75008 Paris, France
Coleman S. Lyttle (1)(2) 1,303,000 (5)(6) 7.8%
2210 Belt Boulevard
Richmond, VA 23224
John R. Potter (1) 100,000 (3) 0.6%
2802 East Madison Suite 152
Seattle, WA 98112
James B. Quarles (1)(2) 910,000 (7) 5.2%
7400 Beaufont Springs Drive, Suite 415
Richmond, VA 23225
Navin D. Sheth (1)(2) 763,000 (5) 4.5%
2210 Belt Boulevard
Richmond, VA 23224
James G. Zumwalt (1) 100,000 (3) 0.6%
1831 Wiehle Avenue, Suite 103
Reston, VA 20190
Dr. Allen Kahn (1) 3,806,001 (8) 21.1%
55 East Washington Street, Suite 2117
Chicago, IL 60602
Warren E. Beam, Jr. (2) 25,000 (4) 0.2%
7400 Beaufont Springs Drive, Suite 415
Richmond, VA 23225
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<PAGE>
Name of Amount and Nature Percent
Beneficial Owner of Beneficial Ownership Class
- ---------------- ----------------------- -------
Directors and Executives 7,107,001(9) 35.7%
Officers as a group (8 persons)
- --------------
(1) Currently serves as a director of the Company.
(2) An executive officer of the Company.
(3) Includes 100,000 shares issuable upon the exercise of options pursuant
to the 1997 Nonstatutory Option Plan.
(4) Includes 25,000 shares issuable upon the exercise of options pursuant to the
1997 Nonstatutory Option Plan.
(5) Includes 320,000 shares issuable upon the exercise of options as follows:
20,000 shares pursuant to the 1994 Nonstatutory Option Plan, 100,000 shares
pursuant to the 1995 Nonstatutory Option Plan, 100,000 shares pursuant to
the 1997 Nonstatutory Option Plan and 100,000 shares pursuant to the
conversion of preferred stock.
(6) Does not include shares in the name of the Estate of Stamie E. Lyttle, of
which Coleman Lyttle is executor, and certain trust created thereby of which
he is trustee. Mr. Lyttle is not a beneficiary of the Estate or the
beneficial owner of Shares of Common Stock owned by the Estate or by any
such trust.
(7) Mr. Quarles' shares are issuable upon the exercise of options as follows:
810,000 shares pursuant to the 1995 Nonstatutory Option Plan and 100,000
shares pursuant to the 1997 Nonstatutory Option Plan.
(8) Includes 1,525,000 shares issuable upon exercise of warrants and conversion
of preferred shares as follows: 25,000 shares pursuant to warrants and
1,500,000 shares pursuant to the conversion of preferred shares.
(9) Includes 3,400,000 shares issuable upon the exercise of options, warrants
and the conversion of preferred stock.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table provides information as to annual and other compensation
paid by the Company to all individuals who served as the Company's Chief
Executive Officer during fiscal 1999 and to each of the other executive officers
of the Company whose total annual salary exceeded $100,000 in fiscal 1999.
Long-Term Compensation
Annual ----------------------
Name and Compensation Awards
Principal Position Year(2) Salary ($) Options/SARs
- ------------------ ------- ---------- ------------
James B. Quarles 1999 125,000 100,000
Chairman, President 1998 44,585 (1) 830,000
and Chief Executive 1997 - -
Officer of the 1996 - -
Company 1995 - -
Coleman S. Lyttle 1999 120,000 100,000
President of 1998 119,785 0
InfraCorps of 1997 115,337 100,000
Virginia, Inc. and a 1996 150,943 0
Director of the 1995 127,603 20,000
Company
Navin D. Sheth 1999 115,000 100,000
Chief Financial Officer
- --------------
(1) Mr. Quarles was appointed President and Chief Executive Officer of the
Company on January 20, 1998. Mr. Quarles became Chairman of the Board on
February 2, 1998. The amounts shown for Mr. Quarles reflect all compensation
received from the Company for services rendered in all capacities in fiscal
1998.
4
<PAGE>
(2) On April 6, 1998, the Board of Directors approved a resolution changing the
fiscal year-end of the Company from May 31 to March 31. Compensation
reported for 1995, 1996 and 1997 is based on a May 31 fiscal year-end.
Compensation shown with respect to 1998 is based on the twelve months ended
March 31, 1998. Accordingly, there is a two-month overlap between the
reported compensation for 1998 (covering the twelve months ended March 31,
1998) and 1997 (covering the twelve months ended May 31, 1997).
Option Grants in Last Fiscal Year
The following table provides information as to options granted in the fiscal
year ended March 31, 1999 to the individuals named in the Summary Compensation
Table above.
<TABLE>
<CAPTION>
Individual Grants Potential
------------------------------------------------ Realized
Value(1) at
Assumed
Annual
Rates of
% of Total Stock Price
Number of Options Market Appreciation
Securities Granted to Exercise Price on for
Underlying Employees or Base Date of Option Term
Options In Fiscal Price Grant Expiration -------------------
Name Granted(#) Year ($/Share)(2) ($/Share)(2) Date 5%($) 10%($)
- ---------------- ---------- --------- ------------ ------------ ---------- -------- ------
<S> <C>
James B. Quarles 100,000 31% 0.17 0.19 8/31/03 24,249 30,600
Coleman S. Lyttle 100,000 31% 0.17 0.19 8/31/03 24,249 30,600
Navin D. Sheth 100,000 31% 0.17 0.19 8/31/03 24,249 30,600
</TABLE>
- --------------
(1)The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission and therefore
are not intended to forecast possible future appreciation, if any, of the
Company's stock price. Additionally, these values do not take into
consideration the provisions of the options providing for nontransferability
or termination of the options following termination of employment. The
Company did not use an alternative formula for a grant date valuation, as it
is not aware of any formula which will determine with reasonable accuracy a
present value based on future unknown or volatile factors.
(2)The market price of the options is calculated based on the closing sales
price of the Company's Common Stock on the NASDAQ Over The Counter Bulletin
Board on the date of grant. Options generally expire five years from the date
of grant.
Aggregate Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End
Option/SAR Values
The following table shows the number and value of stock options exercised by
each of the named executive officers during fiscal year 1999. It also shows the
number and value of unexercised options held by each named executive on March
31, 1999. The value of unexercised options is calculated as the difference
between the exercised price and the average of the high and low bid prices on
the OTC Bulletin Board on March 31, 1999 ($0.15).
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options/SARs at In-the-Money Options/SARs at
March 31, 1999 (#) March 31, 1999 (#)(1)
-------------------------- ----------------------------
Share
Acquired
on Exercise Value
Name (# shares) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------ ----------- ------------- ----------- -------------
<S> <C>
James B. Quarles 0 0 910,000 0 0 0
Coleman S. Lyttle 0 0 220,000 0 0 0
Navin D. Sheth 0 0 220,000 0 0 0
</TABLE>
- --------------
(1)Options are in-the-money if the fair market value of the underlying common
stock exceeds the exercise price of the option. The exercise price of all
outstanding options held by the named executive officers currently exceeds
the fair market value of the underlying Common Stock of the Company.
Likewise, the named executive officers held no in-the-money options at March
31, 1999.
5
<PAGE>
Board of Directors Report on Executive Compensation
The compensation of the Company's executive officers is reviewed and approved
annually by the Board of Directors. In addition to reviewing and approving
executive officers' salary and bonus arrangements, the Board of Directors
establishes policies and guidelines for the other benefits and administers the
awards of stock options pursuant tot he Company's stock option plans.
General. Compensation of the Company's executives is intended to attract,
retain and award persons who are essential to the corporate enterprise. The
fundamental policy of the Company's executive compensation program is to offer
competitive compensation to executives that appropriately rewards the individual
executive's contribution to corporate performance. The Board of Directors
utilizes subjective criteria for evaluation of individual performance and relies
substantially on its key managers in doing so. The Board focuses on two primary
components of the Company's executive compensation program, each of which is
intended to reflect individual and corporate performance: base salary
compensation and long-term incentive compensation.
Base Salary Compensation. Executives' base salaries are determined primarily
by reference to compensation packages for similarly situated executives of
companies of similar size or in comparable lines of business with whom the
Company expects to compete for executive talent. The Board also assesses
subjective qualitative factors to discern a particular executive's relative
value to the corporate enterprise in establishing base salaries. Each year base
salaries of executives are increased by the increases in an average of local and
national cost of living indexes. The Board may aware year-end bonuses to
executives, but only in the event the Company is profitable. The total of all
bonuses generally is based on the Company's overall economic performance.
Bonuses may be awarded pursuant to the Board's subjective analysis of each
executive's performance. No bonuses were awarded or paid in fiscal 1999.
Long Term Incentive Compensation. It is the Board's philosophy that
significant stock ownership by management creates a powerful incentive for
executives to build long-term shareholder value. Accordingly, the Board believes
that an integral component of executive compensation is the award of
equity-based compensation, which is intended to align executives' long-term
interests with those of the Company's shareholders. Awards of stock options to
executives have historically been at then-current market prices and, in keeping
with the Company's objective to link pay with corporate loyalty, generally vest
over a period of one to five years. The Board believes that option grants should
be considered on an annual basis. In general, a fixed minimum option grant is
awarded to all executives and additional grants may be awarded from time to time
consistent with the relative pay levels of the executives.
Submitted by the Board of Directors of the Company:
Coleman S. Lyttle, Navin D. Sheth,
James B. Quarles, Terence R. Dellecker,
Dr. Allen Kahn, John R. Potter,
James G. Zumwalt
6
<PAGE>
Compensation Committee Interlocks and Insider Participation
The Board of Directors makes decisions regarding compensation of executive
officers. Messrs. Coleman S. Lyttle, Navin D. Sheth and James B. Quarles, who
currently continue as directors and executive officers of the Company,
participated during fiscal 1999 in deliberations of the Company's Board of
Directors concerning executive officer compensation. During fiscal 1999, the
Company had notes payable to each of directors Sheth and Lyttle. Each of these
individuals also participated in deliberations of the Board concerning
compensation of executive officers in fiscal 1999. See discussion under
"Transactions with Management" below.
Board of Directors and Committees
The Audit Committee makes recommendations to the Board of Directors with
respect to the Company's financial statements and the appointment of independent
auditors, reviews significant audit and accounting policies and practices, meets
with the Company's independent public accountants concerning, among other
things, the scope of audits and reports, and reviews the performance of the
overall accounting and financial controls of the Company. Members of the Audit
Committee are Messrs. Potter and Dellecker.
The Board of Directors does not have a standing compensation committee. The
Board of Directors is responsible for approving the salaries, bonuses and other
compensation and benefits of executive officers, reviewing and advising
management regarding benefits and other terms and conditions of compensation of
management and administering the Company's stock option plans.
The Board of Directors does not have a standing nominating committee.
Nominations for election to the Board of Directors may be made by the Board of
Directors, or by any shareholder entitled to vote for the election of directors.
Nominations made by shareholders must be made by written notice received by the
Secretary of the Company by July 31 of the year preceding the annual meeting or
within ten days of the date on which notice of a special meeting for the
election of directors is first given to shareholders.
The Board of Directors meets on a quarterly basis. Special meetings are held
from time to time to consider matters for which approval of the Board of
Directors is desirable or required by law. Four meetings of the Board of
Directors were held during fiscal 1999. Each incumbent director had an
attendance record of 75% or greater at meetings
Remuneration of Directors
Outside directors do not receive any fees for attending meetings of the
Board, but are reimbursed for their out-of-pocket expenses in connection
therewith. Directors are entitled to receive the base level of stock options
awarded to executives.
7
<PAGE>
Performance Graph
The following graph compares the yearly percentage change and the cumulative
total of shareholder return on the Company's Common Stock with the cumulative
return on the AMEX Market Value Index, the Russell 2000 Index and the Dow Jones
Heavy Construction Index for the five-year period commencing March 31, 1994 and
ending on March 31, 1998. These comparisons assume the investment of $100 in the
Company's Common Stock and in each of the indices on March 31, 1994 and the
reinvestment of dividends.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG INFRACORPS INC., THE AMEX MARKET VALUE INDEX,
THE RUSSELL 2000 INDEX AND THE DOW JONES HEAVY CONSTRUCTION INDEX
[GRAPH]
*$100 INVESTED ON 3/31/94 IN STOCK OR INDEX -
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING MARCH 31.
Cumulative Total Return
------------------------------
3/94 3/95 3/96 3/97 3/98 3/99
INFRACORPS INC. 100 140 100 60 10 12
AMEX MARKET VALUE 100 105 129 131 173 174
RUSSELL 2000 100 106 136 143 203 170
DOW JONES HEAVY CONSTRUCTION 100 87 116 98 102 65
8
<PAGE>
TRANSACTIONS WITH MANAGEMENT
Effective in 1994, InfraCorps of Virginia, Inc. (formerly ETS Water and Waste
Management, Inc.) ("ICVA") entered into a lease of its premises which are owned
by the Estate of Stamie E. Lyttle, of which Coleman S. Lyttle, a director of the
Company is executor, at $10,500 per month for two years. On June 1, 1997, the
lease was renewed for a one-year term with three one-year renewal options. Rent
expense under this lease was approximately $126,000 for fiscal 1999. The Company
believes that the lease is on terms as favorable as those which would be
available from non-affiliated third parties.
The Company has notes payable to affiliates of $609,900 as of March 31,
1999. These affiliates include Mr. Sheth, Mr. Lyttle, family members of Mr.
Sheth and Mr. Lyttle and the Estate of Stamie S. Lyttle. The balance is
classified as current and due in 1999. The notes, which are unsecured, bear
interest at annual rates between six and twelve percent. Interest is payable
monthly. The aggregate amount of the notes payable to Mr. Sheth and his
family members and affiliates was approximately $335,000 at March 31, 1999.
The aggregate amount of the notes payable to Mr. Lyttle and his family
members and associated entities, including the Estate of Stamie Lyttle, was
approximately $274,900 at March 31, 1999.
On April 27, 1998, the Company completed the sale of the Service Division of
ICVA (e.g., septic system installation and repair, irrigation, plumbing, jacuzzi
service contracts and incidental concrete manufacturing/concrete products) to a
new corporation formed by Coleman S. Lyttle, a director of the Company and
President of ICVA, for a total purchase price of $700,000, payable as follows:
$35,000 cash at closing, assumption of $100,000 of indebtedness of ICVA and
notes payable to ICVA in the aggregate amount of $250,000. At March 31, 1999,
$125,000 was outstanding. The note is due June 1, 2000 and bear interest at six
percent.
The Company had notes receivable from officers of $193,112 as of March 31,
1998, which include notes receivable from Coleman S. Lyttle, President of ICVA
and a director of the Company, in the principal aggregate amount of $180,000,
and from Navin D. Sheth, chief Financial Officer of the Company, Executive Vice
President of ICVA and a director of the Company, in the principal aggregate
amount of $90,000. At March 31, 1998, the outstanding balances on the Lyttle and
Sheth notes were $86,912 and $106,200, respectively. The notes, which are
unsecured, bear annual interest at six percent and are due July 1998.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
The Directors elected at the Annual Meeting will serve until the next
Annual Meeting of Shareholders or until their successors are elected and
qualified. The Board of Directors of the Company has nominated Terence R.
Dellecker, Coleman S. Lyttle, Navin D. Sheth, John R. Potter and James B.
Quarles to serve as directors of the Company for fiscal 2000. All nominees
are members of the Board of Directors.
TERENCE R. DELLECKER (age 52) is a lawyer based in Paris, France. He is a
member of the New York and Massachusetts bars and is licensed to practice in
France as an Avocat a la Cour. He has practiced law since 1970 and
specializes in corporate matters, in particular acquisitions, licensing,
mergers and capital restructurings. Mr. Dellecker served as Associate
Regional Counsel with the Department of Housing and Urban Development in
Boston, Massachusetts from 1972 through 1975. He received his B.S. in
Electrical Engineering from Princeton University in 1967 and his J.D. from
Harvard Law School in 1970.
COLEMAN S. LYTTLE (age 45) has served as President of ICVA since June
1994. From 1982 to 1994, he was President of Stamie E. Lyttle Company, Inc.
and Lyttle Utilities, Inc. From 1975 to 1982, he was Senior Estimator and
Project Manager of Stamie E. Lyttle Company, Inc. Mr. Lyttle received his
B.S. in Business Administration from Virginia Polytechnic Institute and State
University in 1975.
JOHN R. POTTER (age 53) founded Stratagem Inc., a business consulting firm
based in Seattle, Washington, in 1993 and is a principal in that company. He
was a Director of Enviros Inc., a biotechnology firm, from 1993 through 1996
and from 1983 until 1993 was president and chief Executive Officer of Utilx
Corporation, a NASDAQ-listed utility construction technology company. Mr.
Potter received his B.A. from Harvard University and his B.S. and M.S. in
Mechanical Engineering from Massachusetts Institute of Technology.
9
<PAGE>
JAMES B. QUARLES (age 46) has served as President and Chief Executive Officer
of the company since January 20, 1998. He became Chairman of the Company's Board
of Directors on February 2, 1998. From October 1997 to February 1998, Mr.
Quarles was the sole officer, director and shareholder of Q Enterprises, Inc., a
Virginia corporation, which purchased substantially all of the assets of ETS
Analytical Services, Inc., a wholly-owned subsidiary of the Company, and
provided consulting services to the Company. Prior thereto, he was employed as
the Senior Vice President for mergers and acquisitions with the Company from May
1997 through October 1997, and from January 1987 to December 1996 was Chairman
and president of Enviros Inc., a biotechnology company based in Seattle,
Washington. Mr. Quarles began his career in the U.S. Navy, where he served under
Admiral Elmo R. Zumwalt, Jr., former Chief of Naval Operations and the current
Coordinator of the Company's Management Advisory Committee.
NAVIN D. SHETH (age 52) has served as Executive Vice-President of ICVV
since June 1994 and, since May 1996, also served as Chief Operating Officer.
He was appointed Chief Financial Officer of the Company on January 20, 1998.
From 1972 to May 1994, he was associated with Stamie E. Lyttle Company, Inc.
in the following capacities: from 1982 to 1994 -- Vice President-Finance;
from 1979 to 1982 - Controller; from 1972 to 1979 - Operations Analyst. Mr.
Sheth was Assistant Professor, Virginia College, Lynchburg, Virginia, from
1971 to 1972. He received his B.S. in Chemistry in 1967 from Bombay
University and his MBA in 1971 from Atlanta University, Atlanta, Georgia.
It is the intention of the persons named as proxies in the accompanying
proxy, unless instructed otherwise, to vote for the persons nominated by the
Board. If any nominee should become unavailable to serve, the proxy may be voted
for the election of such substitute nominee as may be designated by the Board.
The Board has no reason to believe that any of the nominees will be unable to
serve if elected.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE ABOVE-NAMED
NOMINEES.
The following directors currently serve and were elected by the Series A
Preferred Shareholders pursuant to the agreement for the purchase of the Series
A Preferred Stock.
JAMES G. ZUMWALT (age 50) currently serves as Vice President of Admiral
Zumwalt and Consultants, Inc., an international firm providing expertise to
domestic and international clients in exploring and accessing investment
opportunities, and as President of J. G. Zumwalt and Associates, Inc., providing
corporate, management and real estate services. From 1992 till 1993 Mr. Zumwalt
was the Senior Advisor to the Assistance Secretary of State. During the period
1979 through 1990 he served in corporate counsel positions with Cummins Engine
Company, Inc., and System Planning Corporation and in the private practice of
law. Mr. Zumwalt graduated in 1970 from the University of North Carolina, Chapel
Hill with a BA and from Villanova School of Law in 1979. He served in the United
States Navy from 1970 to 1971 and the United States Marine Corps between 1971
and 1976.
ALLEN KAHN, MD (age 78) began his private practice in 1953 until present in
Chicago, Illinois. He received a BS in Biochemistry in 1944 from Pennsylvania
State University and a MD in 1949 from University of Pennsylvania. From 1953 to
1957 he attended the Institute for Psychoanalysis of Chicago, Illinois for
various seminars and courses. From 1965 through 1995 Dr. Kahn has served in the
capacity of an Investor and Board member for Nease Chemical Company (currently
German Chemical Company), Hollymatic Corporation and Pay Fone Systems (currently
Pay Chex, Inc.). Drl Kahn's expertise in entrepreneurial investments of small
"concept companies" with eventual profitability and growth began in 1960 until
present.
PROPOSAL NO. 2 - APPROVING THE APPOINTMENT OF GOODMAN AND COMPANY INDEPENDENT
AUDITORS FOR FISCAL 2000
The Board of Directors appointed Goodman and Company as independent certified
public accountants to audit the financial statements for fiscal 2000 and has
determined that it would be desirable to request that the shareholders approve
such appointment. Shareholder approval is not required for the appointment of
Goodman and company since the Board of Directors has the responsibility to
selecting auditors. However, the appointment is being submitted for the approval
at the Annual meeting. No determination has been made as to what action the
Board would take if shareholders do not approve the appointment.
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A representative of Goodman and company is expected to attend the Annual
Meeting with the opportunity to make a statement and/or respond to appropriate
questions from shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF GOODMAN AND COMPANY
AS INDEPENDENT AUDITORS.
SECTION 16(a) BENEFICIAL OWNERSHIP COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires Company
officers and directors, and persons who own more than ten percent of a
registered class of the Company' equity securities, to file reports of ownership
and changes in ownership with the Securities and Exchange Commission. Officers,
directors and greater than ten percent shareholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
PROPOSALS OF SHAREHOLDERS
Proposals of shareholders intended to be presented at the Company's fiscal
2001 Annual Meeting must be received by the President of the Company, at the
Company's headquarters, 7400 Beaufont Springs Drive, Suite 415, Richmond,
Virginia 23225, no later than February 24, 2000, in order to be considered for
inclusion in the Company's Proxy Statement relating to that meeting.
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OTHER MATTERS
The Board of Directors is not aware of any matter to be presented for action
at the meeting other than the matters set forth herein. Should any other matters
requiring a vote of shareholders arise, the proxies in the enclosed form confer
upon the person or persons entitled to vote the share represented by such
proxies discretionary authority to vote the same in accordance with their best
judgment in the interest of the Company.
BY ORDER OF THE BOARD OF DIRECTORS
WARREN E. BEAM, JR.
Secretary
July 9, 1999
The Company's Annual Report on Form 10-K for fiscal year ended March 31, 1999
is available without charge to any shareholder requesting the same. Written
requests should be addressed to the attention of Mr. Warren E. Beam, Jr.,
Secretary, InfraCorps Inc., 7400 Beaufont Springs Drive, Suite 415, Richmond,
Virginia 23225.
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