MONTEREY HOMES CORPORATION
6613 NORTH SCOTTSDALE ROAD
SUITE 200
SCOTTSDALE, ARIZONA 85250
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NOTICE AND PROXY STATEMENT
FOR A SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 16, 1998
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To Our Stockholders:
The Management of Monterey Homes Corporation cordially invites you to
attend a Special Meeting of Stockholders to be held at 9:00 a.m., on Wednesday,
September 16, 1998, at the Company's principal executive offices, 6613 North
Scottsdale Road, Scottsdale, Arizona for the following purposes:
1. To amend the Company's Amended and Restated Articles of
Incorporation to change the name of the Company to "Meritage
Corporation";
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
Each outstanding share of the Company's Common Stock entitles the
holder of record at the close of business on July 30, 1998 (the "Record Date"),
to receive notice of and to vote at the Special Meeting or any adjournment
thereof. Shares of Common Stock can be voted at the Special Meeting only if the
holder is present at the meeting in person or by valid proxy.
By Order of the Board of Directors
Scottsdale, Arizona Larry W. Seay
__________, 1998 Vice President-Finance, Chief Financial Officer,
Secretary and Treasurer
IMPORTANT
TO ASSURE REPRESENTATION, STOCKHOLDERS ARE REQUESTED TO SIGN,
DATE AND MAIL THE ENCLOSED PROXY. A POSTAGE PAID ENVELOPE IS
PROVIDED FOR MAILING IN THE UNITED STATES.
<PAGE>
MONTEREY HOMES CORPORATION
6613 NORTH SCOTTSDALE ROAD
SUITE 200
SCOTTSDALE, ARIZONA 85250
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PROXY STATEMENT
--------------------------
This Proxy Statement and the accompanying Proxy and Notice of Meeting
of Shareholders are furnished to holders of common shares (the "Common Shares")
of Monterey Homes Corporation (the "Company") in connection with the
solicitation by its Board of Directors (the "Board") of proxies to be used at
the Special Meeting of Shareholders of the Company (the "Meeting") to be held on
September 16, 1998 at 9:00 a.m. at the Company's principal executive offices in
Scottsdale, Arizona, and at any postponements or adjournments thereof. Only
those shareholders of record at the close of business on July 30, 1998 will be
entitled to receive notice of, and to vote at, the Meeting. Copies of this Proxy
Statement and the accompanying Proxy and Notice of Meeting of Shareholders are
first being mailed to shareholders on or about August 5, 1998.
All Common Shares represented by each properly executed Proxy received
by the Board pursuant to this solicitation will be voted in accordance with the
shareholder's directions specified on the Proxy. If no directions have been
specified on a Proxy, the Common Shares represented by the Proxy will be voted
in accordance with the Board's recommendation, which is:
"FOR" the amendment of the Company's Amended Articles of Incorporation
to change the name of the Company to "Meritage Corporation".
Management knows of no other matters that may properly be brought, or
which are likely to be brought, before the Meeting. However, if any other
matters are properly brought before the Meeting, the persons named as proxies in
the accompanying Proxy or their substitutes will vote in accordance with their
best judgment on such matters.
Without affecting any vote previously taken, a shareholder signing and
returning a Proxy has the power to revoke it at any time prior to its exercise
by giving notice to the Company in a writing mailed to Larry W. Seay, Secretary
of the Company, at the Company's executive offices at 6613 North Scottsdale
Road, Suite 200, Scottsdale, Arizona, 85250, by executing a subsequent Proxy, or
by attending the Meeting and giving notice of such revocation in person to the
inspector of elections at the Meeting. Attendance at the Meeting will not, in
and of itself, constitute revocation of a Proxy.
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Voting Securities Outstanding
The presence, in person or by proxy, of the holders of a majority of
the Common Shares issued and outstanding on July 30, 1998, is necessary to
constitute a quorum at the Meeting. As of the Record Date, the Company had
_________________Common Shares issued and outstanding.
Each shareholder is entitled to one vote for each Common Share held.
Common Shares represented by signed proxies that are returned to the Company
will be counted toward the quorum in all matters even though they are marked as
"Abstain," "Against," or "Withhold Authority" or they are not marked at all.
Broker/dealers who hold their customers' Common Shares in street name may, under
the applicable rules of the self-regulatory organizations of which the
broker/dealers are members, sign and submit proxies for such Common Shares and
may vote such Common Shares on routine matters which, under such rules,
typically include the election of directors and the ratification of the
selection of independent public accountants, but broker/dealers may not vote
such Common Shares on other matters without specific instructions from the
customers who own such Common Shares. Proxies signed and submitted by
broker/dealers which have not been voted on certain matters as described in the
previous sentence are referred to as broker non-votes. Such proxies also count
toward the establishment of a quorum. The effect of an abstention or broker
non-vote on each of the matters to be voted upon at the meeting is the same as a
"no" vote.
All costs of a solicitation of the Proxies will be borne by the
Company. Solicitation will be made by mail. Proxies may be further solicited at
no additional compensation by officers, directors or employees of the Company by
telephone, written communication or in person. Upon request, the Company will
reimburse banks, brokerage firms, and other custodians, nominees and fiduciaries
for expenses reasonably incurred by them in sending proxy materials to the
beneficial owners of Common Shares of the Company. No solicitation will be made
by specifically engaged employees or other paid solicitors.
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SECURITY OWNERSHIP OF
PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth, as of July 30, 1998, the number and
percentage of outstanding shares of the Company's Common Stock beneficially
owned by (i) each person known by the Company to beneficially own more than 5%
of such stock, (ii) all directors of the Company, (iii) all directors and
executive officers of the Company as a group.
<TABLE>
<CAPTION>
Shares
Name and Address of Beneficial Owner(1) Beneficially Percent Owned(3)
--------------------------------------- Owned(2) ----------------
--------
<S> <C> <C>
William W. Cleverly 742,890(4) 13.7%
Steven J. Hilton 739,557(4) 13.6%
John R. Landon 722,223(4)(5) 13.5%
Alan D. Hamberlin 368,235(6) 6.4%
Robert G. Sarver 146,200(7) 2.7%
C. Timothy White 5,800(7) *
Ray Oppel --- *
Larry W. Seay 2,000(8) *
Richard T. Morgan 4,500(8) *
All directors and executive officers
as a group (9 persons) 2,731,405 50.2%
</TABLE>
- -------------
* Represents less than 1%.
(1) The address for each beneficial owner is c/o Monterey Homes Corporation,
6613 North Scottsdale Road, Suite 200, Scottsdale, Arizona 85250.
(2) Includes, where applicable, shares of Common Stock owned of record by such
person's minor children and spouse and by other related individuals and
entities over whose shares of Common Stock such person has custody, voting
control or the power of disposition.
(3) The percentages shown include the shares of Common Stock actually owned as
of July 30, 1998, and the shares which the person or group had the right to
acquire within 60 days of such date. In calculating the percentage of
ownership, all shares of Common Stock which the identified person or group
had the right to acquire within 60 days of July 30, 1998, upon exercise of
options are deemed to be outstanding for the purpose of computing the
percentage of the shares owned by that person or group, but are not deemed
to be outstanding for the purpose of computing the percentage of the shares
of Common Stock owned by any other person.
(4) Includes 55,556 shares currently issuable upon exercise of outstanding
stock options.
(5) Includes 666,667 shares owned with Eleanor Landon, spouse, as
tenants-in-common.
(6) Includes 12,633 shares of Common Stock indirectly beneficially owned by Mr.
Hamberlin through a partnership and 355,602 shares of Common Stock
currently issuable to Mr. Hamberlin upon exercise of outstanding stock
options.
(7) Includes 2,500 shares currently issuable upon exercise of outstanding stock
options.
(8) Includes 2,000 shares currently issuable upon exercise of outstanding stock
options.
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AMENDMENT TO THE COMPANY'S
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
TO CHANGE ITS NAME
The Board recommends that the Shareholders approve a resolution to
amend Article I of the Company's Articles of Incorporation to change the name of
the Company from "Monterey Homes Corporation" to "Meritage Corporation". The
Board believes it is in the best interest of the Company to change the corporate
name to more clearly convey a consistent overall image and identity as it grows
through diversification of product types and geographic scope, while retaining
the ability to operate under separate brand names in individual markets.
Homebuilding operations in Arizona and Texas will continue under the brand names
Monterey Homes and Legacy Homes, respectively, while the recently acquired
Sterling Homes will operate under the Meritage Homes name.
If approved by the Shareholders, the amendment will become effective
upon filing a Certificate of Amendment with the Maryland Secretary of State
which filing is expected to be made shortly after the Meeting. However, the
Board of Directors will be authorized, without a further vote of the
Shareholders, to abandon the name change and determine not to file the
certificate of amendment if the Board concludes that such action would be in the
best interest of the Company and its Shareholders.
If the proposed name change is adopted, it is the intent of the Company
to use the name "Meritage Corporation" in its communications with Shareholders
and the investment community. The Company's common stock will continue to be
traded under the symbol MTH on the New York Stock Exchange.
Shareholders will not be required to exchange any outstanding share
certificates for certificates containing the Company's new name. Share
certificates reflecting the name Meritage Corporation will be issued upon any
purchase, sale or other disposition of shares following the effective date of
the name change.
Proposal
Shareholders are requested to approve the following resolution to amend
the Amended and Restated Articles of Incorporation of the Company:
RESOLVED, that Article I of the Company's Amended and Restated Articles
of Incorporation be, and it hereby is, amended to read as follows:
FIRST: The name of the corporation (which is hereinafter called the
"Corporation") is Meritage Corporation.
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Recommendation and Vote
Approval of the amendment to the Company's Amended and Restated
Articles of Incorporation to change the name of the Company will require the
affirmative vote of a majority of the Common Shares issued and outstanding as of
the record date.
The Board of Directors recommends that shareholders vote "FOR" the
approval of the adoption of the amendment to the Company's Amended and Restated
Articles of Incorporation to change its name to Meritage Corporation.
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