<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT
(PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934)
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ ] Confidential, for Use of the Commission Only
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
POLYVISION CORPORATION
(Name of Registrant as Specified in Its Charter)
POLYVISION CORPORATION
(Name of Persons(s) Filing Proxy Statement)
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 transactions apply:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(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>
POLYVISION CORPORATION
April 20, 1999
Dear Shareholder:
We cordially invite you to attend our 1998 Annual Meeting of
Shareholders to be held at 10:00 a.m. on Tuesday, May 18, 1999, at
The Mayflower Hotel - The Conservatory, 15 Central Park West, New York, NY
10023. Enclosed are the Notice of Annual Meeting, Proxy Statement and a Proxy
Card relating to the Annual Meeting which we urge you to read carefully. Also
enclosed is PolyVision's Annual Report on Form 10-K for the eight months
ended December 31, 1998 and its Current Report on Form 8-K, as amended,
reporting the recent acquisition of Alliance International Group, Inc.
Whether or not you expect to attend the Annual Meeting, please sign and date
the enclosed Proxy Card and return it as promptly as possible to ensure that
your shares will be voted. Because mail delays occur frequently, it is
important that the enclosed Proxy Card be returned well in advance of the
meeting.
On Behalf of Your Board of Directors
STEVEN S. ELBAUM
CHAIRMAN OF THE BOARD
JOSEPH A. MENNITI
CHIEF EXECUTIVE OFFICER
<PAGE>
POLYVISION CORPORATION
48-62 36th Street
Long Island City, New York 11101
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 18, 1999
-------------------
TO THE SHAREHOLDERS OF
POLYVISION CORPORATION:
Notice is hereby given that the Annual Meeting of Shareholders (the
"Annual Meeting") of PolyVision Corporation, a New York corporation
("PolyVision"), will be held at The Mayflower Hotel - The Conservatory, 15
Central Park West, New York, NY 10023, on Tuesday, May 18, 1999, beginning at
10:00 a.m., local time. The Annual Meeting will be held for the following
purposes:
1. To elect four Class I directors to the Board of Directors, each to
hold office until the Year 2000 Annual Meeting and until his successor
has been elected and qualified.
2. To approve an amendment to PolyVision's Certificate of Incorporation
increasing the number of authorized shares of common stock from
25,000,000 shares to 40,000,000 shares.
3. To ratify the adoption by the Board of Directors of PolyVision's 1999
Stock Option Plan.
4. To authorize and approve the issuance of warrants to purchase common
stock, and the possible issuance of common stock underlying such
warrants, which would represent 20% or more of the outstanding shares
of common stock.
5. To ratify the selection of Arthur Andersen LLP as PolyVision's
independent auditor.
6. To consider and transact such other business as may properly be
brought before the Annual Meeting or any adjournment thereof.
The Board of Directors has fixed April 16, 1999, as the record date for
the determination of shareholders entitled to notice of and to vote at the
Annual Meeting and any postponements or adjournments thereof, and only
shareholders of record at the close of business on that date are entitled to
such notice and to vote at the Annual Meeting. A list of shareholders entitled
to vote at the Annual Meeting will be available at the Annual Meeting and at the
offices of PolyVision for ten days prior to the Annual Meeting.
We hope that you will use this opportunity to take an active part in
the affairs of PolyVision by voting on the business to come before the Annual
Meeting, either by executing and returning the enclosed Proxy Card or by casting
your vote in person at the Annual Meeting.
<PAGE>
SHAREHOLDERS UNABLE TO ATTEND THE ANNUAL MEETING IN PERSON ARE
REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE. A
STAMPED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. IF A SHAREHOLDER RECEIVES
MORE THAN ONE PROXY CARD BECAUSE HE OR SHE OWNS SHARES REGISTERED IN DIFFERENT
NAMES OR ADDRESSES, EACH PROXY CARD SHOULD BE COMPLETED AND RETURNED.
By Order of the Board of Directors
BARRY M. PURITZ
VICE PRESIDENT OF BUSINESS DEVELOPMENT
AND SECRETARY
Long Island City, New York
April 20, 1999
<PAGE>
POLYVISION CORPORATION
48-62 36th Street
Long Island City, New York 11101
(718) 433-2170
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 1999
INTRODUCTION
This Proxy Statement is being furnished to the shareholders by the Board
of Directors of PolyVision Corporation, a New York corporation
("PolyVision"), for solicitation of proxies for use at the Annual Meeting of
Shareholders to be held at The Mayflower Hotel - The Conservatory, 15 Central
Park West, New York, NY 10023, on Tuesday, May 18, 1999, at 10:00 a.m., local
time, and at any and all adjournments thereof (the "Annual Meeting").
The expense of this solicitation of proxies will be borne by PolyVision.
Solicitations will be made only by use of the mail except that, if deemed
desirable, officers and regular employees of PolyVision may solicit proxies
by telephone, telegraph and personal calls. Brokerage houses, custodians,
nominees and fiduciaries will be requested to forward the proxy soliciting
material to the beneficial owners of the stock held of record by such persons
and PolyVision will reimburse them for their reasonable expenses incurred in
this connection.
PolyVision's Transition Report on Form 10-K, including financial
statements for the eight months ended December 31, 1998, and its Current
Report on Form 8-K and Form 8-K/A reporting the recent acquisition of
Alliance International Group, Inc. and containing financial statements
related to the acquisition, accompanies this Proxy Statement.
The purpose of the meeting and the matters to be acted upon are set forth
in the attached Notice of Annual Meeting. As of the date of this Proxy
Statement, the Board of Directors knows of no other business which will be
presented for consideration at the Annual Meeting. A shareholder giving a proxy
pursuant to the present solicitation may revoke it at any time before it is
exercised by submitting a duly executed proxy bearing a later date or by
delivering to the Secretary of PolyVision a written notice of revocation prior
to the Annual Meeting, or by appearing at the Annual Meeting and expressing a
desire to vote his or her shares in person. Subject to such revocation, all
shares represented by a properly executed proxy received prior to or at the
Annual Meeting will be voted by the proxy holders whose names are set forth in
the accompanying proxy in accordance with the instructions on the proxy. If no
instruction is specified with respect to a matter to be acted upon, the shares
represented by the proxy will be voted
o "FOR" the election of the nominees for director set forth herein,
o "FOR" the approval of an amendment to PolyVision's Certificate of
Incorporation increasing the number of authorized shares of common
stock from 25,000,000 shares to 40,000,000 shares,
o "FOR" the ratification of the adoption by the Board of Directors of
PolyVision's 1999 Stock Option Plan,
<PAGE>
o "FOR" the authorization and approval of the issuance of warrants to
purchase common stock, and the possible issuance of common stock
underlying such warrants, which would represent 20% or more of the
outstanding common stock, and
o "FOR" the proposal to ratify the appointment of Arthur Andersen LLP as
the independent auditor of PolyVision for the fiscal year ended
December 31, 1998.
If any other business shall properly come before the Annual Meeting, votes
will be cast pursuant to said proxies in respect of any such other business in
accordance with the judgment of the persons acting under said proxies.
It is anticipated that the mailing to shareholders of this Proxy Statement
and the enclosed proxy will commence on or about April 20, 1999.
<PAGE>
OUTSTANDING SECURITIES AND VOTING RIGHTS
Only shareholders of record at the close of business on April 16, 1999
(the "Record Date") are entitled to notice of and to vote at the Annual
Meeting. At that date, there were 14,117,750 outstanding shares of common
stock, par value $.001 per share, the only currently outstanding voting
security of PolyVision.
The holders of a majority of the outstanding shares of common stock,
present in person or by proxy, will constitute a quorum at the Annual Meeting.
Abstentions and broker non-votes will be counted for purposes of determining the
presence or absence of a quorum. "Broker non-votes" are shares held by brokers
or nominees which are present in person or represented by proxy, but which are
not voted on a particular matter because instructions have not been received
from the beneficial owner. Under applicable New York law, the effect of the
broker non-votes on a particular matter depends on whether the matter is one as
to which the broker or nominee has discretionary voting authority. The effect of
broker non-votes on the specific items to be brought before the Annual Meeting
is discussed under each item.
As of the Record Date, The Alpine Group, Inc. ("Alpine"), of which
Steven S. Elbaum, Bragi F. Schut and Stephen C. Knup, directors of
PolyVision, are directors and/or executive officers, possessed the power to
vote approximately 48.4% of the outstanding shares of common stock.
PolyVision has been advised that Alpine intends to vote all of the shares
beneficially owned by it "FOR" all of the proposals.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth information as to the shares of common stock
owned as of the Record Date, by (i) each person known to PolyVision to be the
beneficial owner of more than 5% of the common stock; (ii) each director; (iii)
each executive officer named in the Summary Compensation Table herein; and (iv)
all directors and executive officers of PolyVision as a group. Unless otherwise
indicated in the footnotes following the table, the persons as to whom the
information is given had sole voting and investment power over the shares of
common stock shown as beneficially owned by them, subject to community property
laws where applicable.
<TABLE>
<CAPTION>
Number of Percent of
Shares Common Stock
Name and Address of Beneficially Beneficially
Beneficial Owner Owned(1) Owned(1)
- ------------------- ----------- ---------------
<S> <C> <C>
The Alpine Group, Inc. 13,568,370 65.1%
1790 Broadway
New York, NY 10019
John Hancock Mutual Life Insurance Company 2,986,467 17.5%
200 Clarendon Street
Boston, MA 02117
Wind Point Partners III, L.P. 2,666,667 15.9%
676 North Michigan Avenue, Suite 3300
Chicago, IL 60611
Steven S. Elbaum 14,060,814 67.4%
c/o The Alpine Group, Inc.
1790 Broadway
New York, NY 10019
Ivan Berkowitz 53,333(7) *
1790 Broadway
New York, NY 10019
Michael H. Dunn --(8) --
c/o PolyVision Corporation
4888 South Old Peachtree Road
Norcross, GA 30071
Lyman C. Hamilton, Jr 54,848(6) *
69 Byron Drive
Avon, CT 06001
Stephen C. Knup 28,750(6) *
c/o The Alpine Group, Inc.
1790 Broadway
New York, NY 10019
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Number of Percent of
Shares Common Stock
Name and Address of Beneficially Beneficially
Beneficial Owner Owned(1) Owned(1)
- ------------------- ----------- ---------------
<S> <C> <C>
Joseph A. Menniti 150,333(9) 1.1%
c/o PolyVision Corporation
48-62 36th Street
Long Island City, NY 11101
Bragi F. Schut 147,803(6) 1.0%
c/o The Alpine Group, Inc.
1790 Broadway
New York, NY 10019
Barry M. Puritz 5,000(10) *
c/o PolyVision Corporation
48-62 36th Street
Long Island City, NY 11101
All executive officers and 14,500,881 70.7%
directors as a group
(8 persons)
</TABLE>
- ------------------------
* Percentage ownership is less than 1%.
(1) In accordance with Rule 13d-3(d)(1)(i) of the Securities Exchange Act
of 1934, as amended, shares beneficially owned include shares issuable
upon the exercise of options, warrants, rights or conversion privileges
within 60 days of the Record Date. For the purpose of computing the
percentage of outstanding shares beneficially owned by a particular
person, any securities not outstanding which are subject to options,
warrants, rights or conversion privileges exercisable by that person
within 60 days of the Record Date, have been deemed to be outstanding,
but have not been deemed outstanding for the purpose of computing the
percentage of the class beneficially owned by any other person.
(2) Includes (i) 4,250,000 shares of common stock reserved for issuance
upon the conversion of outstanding shares of Series B Preferred Stock,
and (ii) 2,500,000 shares of common stock reserved for issuance upon
the conversion of outstanding shares of Series C Preferred Stock, each
of which was purchased by Alpine in November 1998.
(3) Represents shares of common stock reserved for issuance upon the
exercise of outstanding warrants issued to John Hancock Mutual Life
Insurance Company and certain of its affiliates in connection with a
$25,000,000 senior subordinated credit facility entered into with
PolyVision in December 1998.
(4) Represents shares of common stock reserved for issuance upon the
conversion of a 10% Convertible Subordinated Promissory Note due 2007
issued in connection with PolyVision's acquisition of Alliance
International Group, Inc. in November 1998.
3
<PAGE>
(5) Includes the shares of common stock owned by Alpine. Mr. Elbaum may be
deemed to be the beneficial owner of such shares by virtue of his
position as Chairman of the Board and Chief Executive Officer of Alpine
and his beneficial ownership of 11.1% of the issued and outstanding
common stock of Alpine.
(6) Pursuant to PolyVision's 1995 Directors Stock Option Plan, each of
Messrs. Elbaum, Hamilton, Knup and Schut were granted stock options to
purchase 25,000 shares of common stock in October 1995 at an exercise
price of $3.86 per share. Under the terms of the 1995 Directors Stock
Option Plan, such options become exercisable over a four-year period,
vesting as to one-fourth of the total number of options granted in
October of each year, commencing October 1996.
(7) Includes stock options to purchase 35,000 shares of common stock
granted to Mr. Berkowitz under the terms of PolyVision's 1994 Stock
Option Plan at an exercise price of $1.00. Excludes 3,334 shares of
common stock under PolyVision's 1995 Directors Stock Grant Plan, which
will vest and be issuable to Mr. Berkowitz if he is elected a director
at the next Annual Meeting of Shareholders.
(8) Excludes stock options to purchase an aggregate of 250,000 shares of
common stock granted in November 1998, which are exercisable in
increments of 62,500 shares in November 1999, 2000, 2001 and 2002.
(9) Includes (i) 12,000 of the 15,000 "restricted" shares of common stock
granted to Mr. Menniti under the terms of his employment agreement with
PolyVision, with the remaining shares to be earned on May 1, 2000,
subject to certain conditions in the event of Mr. Menniti's earlier
termination of employment, (ii) stock options to purchase 75,000 shares
of common stock granted to Mr. Menniti under the terms of PolyVision's
1994 Stock Option Plan at an exercise price of $1.00, (iii) stock
options to purchase 30,000 shares of common stock granted under the
terms of PolyVision's 1994 Stock Option plan at an exercise price of
$1.00, and (iv) stock options to purchase 33,333 of the 100,000 shares
of common stock granted to Mr. Menniti under the terms of PolyVision's
1994 Stock Option Plan at an exercise price of $1.25 per share, which
are exercisable in one-third increments on each of May 1, 1999, 2000
and 2001. Excludes stock options to purchase an aggregate of 175,000
shares of common stock granted in October 1998, which are exercisable
in increments of 43,750 shares in each of November 1999, 2000, 2001 and
2002.
(10) Includes (i) stock options to purchase 2,333 of the 7,000 shares of
common stock granted to Mr. Puritz under the terms of PolyVision's 1994
Stock Option Plan at an exercise price of $1.00 per share, with the
remaining options to be exercisable in equal increments in December
1999 and 2000, and (ii) stock options to purchase 2,667 of the 8,000
shares of common stock granted to Mr. Puritz under the terms of
PolyVision's 1994 Stock Option Plan at an exercise price of $1.25 per
share, with the remaining options to be exercisable in equal increments
in May 2000 and 2001.
4
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
TERM OF OFFICE
PolyVision's Restated Certificate of Incorporation provides that the Board
of Directors of PolyVision shall consist of three to nine directors. Presently,
the Board of Directors of PolyVision is comprised of seven directors and is
divided into two classes, with staggered two-year terms, and one class of
directors is elected at each Annual Meeting of Shareholders.
At the 1997 Annual Meeting of Shareholders, Steven S. Elbaum and Lyman C.
Hamilton, Jr. were re-elected to PolyVision's Board of Directors as Class II
directors to hold office until the 1999 Annual Meeting of Shareholders and until
their successors are elected and qualified. At the 1996 Annual Meeting of
Shareholders, Ivan Berkowitz, Stephen C. Knup and Bragi F. Schut were elected as
Class I directors to hold office until this 1998 Annual Meeting of Shareholders
and until their successors are elected and qualified. In May 1997, Joseph A.
Menniti, PolyVision's Chief Executive Officer, was elected a Class II director
to fill a vacancy on PolyVision's Board, and in November 1998, Michael H. Dunn,
PolyVision's President and Chief Operating Officer, was elected a Class I
director following PolyVision's acquisition of all of the capital stock of
Alliance International Group, Inc.
At the Annual Meeting, in accordance with PolyVision's Restated Certificate
of Incorporation and By-laws which relate to corporate governance, four persons
are to be elected to the Board of Directors of PolyVision as Class I directors
to hold office until the 2000 Annual Meeting of Shareholders and until their
successors are elected and qualified, and it is intended that shares represented
by properly executed proxies will be voted, in the absence of contrary
instructions, in favor of the election of the following named nominees, all of
whom are presently Class I directors: Ivan Berkowitz, Michael H. Dunn, Stephen
C. Knup and Bragi F. Schut. The directors unanimously approved the nominations
as noted at a special meeting of the Board of Directors held January 26, 1999.
The affirmative vote of the holders of a majority of the shares of common stock
present or represented at the Annual Meeting is required to elect the foregoing
nominees to the Board of Directors.
The persons named in the enclosed proxy intend to vote the shares
represented by proxies for these nominees unless the vote for such persons is
withheld. If any of those nominated should not continue to be available for
election, it is intended that the shares represented by the proxies will be
voted for such other person or persons as the Board shall designate. No
circumstances are presently known which would render any nominee named herein
unavailable for election. Abstentions and broker non-votes will have no affect
on the election of directors.
5
<PAGE>
NOMINEES FOR DIRECTOR
DIRECTORS TO HOLD OFFICE UNTIL 2000 MEETING (CLASS I)
IVAN BERKOWITZ - AGE 53
Director since 1995
Mr. Berkowitz was elected a director of PolyVision in May 1995, and served
as Chief Executive Officer of PolyVision from such date to April 1997.
Previously, from September 1993 to March 1995, he was the Managing General
Partner of Steib & Company, a private investment partnership. Since March 1995,
Mr. Berkowitz has also been a director of Propierre I, a public French real
estate mutual fund, and, since January 1998, a director of HMG Worldwide
Corporation, a point-of-purchase display manufacturer. From 1978 through
December 1994, Mr. Berkowitz was a Managing Director of Chestnut Hill
Securities, Inc., a registered broker-dealer in Los Angeles, California.
MICHAEL H. DUNN - AGE 49
Director since 1998
Mr. Dunn was elected President and Chief Operating Officer of PolyVision in
November 1998, following PolyVision's acquisition of Alliance International
Group, Inc. ("Alliance"). Mr. Dunn had served as Chairman, President and Chief
Executive Officer of Alliance since October 1997. He also served as President of
Alliance from March 1985 to January 1992. In the interim, from January 1992 to
February 1997, Mr. Dunn served as President and Chief Executive Officer of
Visibility Inc., a manufacturing enterprise software company and a portfolio
company of Equity South, a buyout fund of which Mr. Dunn remains a general
partner.
STEPHEN C. KNUP - AGE 55
Director since 1995
Mr. Knup was elected a director of PolyVision in May 1995. Mr. Knup
recently joined Alpine as a Senior Vice President in February 1999. He
previously served as Executive Vice President and Chief Financial Officer of
MG North America Holdings Inc. (formerly known as MetallGesellschaft Corp.),
a raw materials company, from November 1994 to February 1999. Mr. Knup also
served as the Chief Operating Officer of Frankel & Co., an insurance
brokerage company, from May 1994 to November 1994, the Senior Vice President
and Chief Financial Officer of AMAX Inc., a natural resource and a natural
gas producer, from February 1988 to December 1993, and a consultant to Cyprus
Amax Minerals Company, its successor by merger, from January 1994 to March
1994.
BRAGI F. SCHUT - AGE 58
Director since 1994
Mr. Schut was elected a director of PolyVision in December 1994. Mr.
Schut has been a director of Alpine since 1983 and its Executive Vice
President since 1986. Mr. Schut is also a director of Superior TeleCom, Inc.
("Superior TeleCom"), a manufacturer of copper telecommunications wire and
cable.
6
<PAGE>
DIRECTORS CONTINUING IN OFFICE UNTIL 1999 MEETING (CLASS II)
STEVEN S. ELBAUM - AGE 50
Director since 1994
Mr. Elbaum was elected Chairman of the Board and a director of
PolyVision in December 1994. Mr. Elbaum has been a director of Alpine since
1980 and has served as its Chairman of the Board and Chief Executive Officer
since June 1984. Mr. Elbaum has also been the Chairman of the Board,
President and Chief Executive Officer of Superior TeleCom since July 1996.
Mr. Elbaum serves on the Board of Directors of Interim Services, Inc., a
provider of value-added staffing and healthcare services, HumaScan, Inc., a
developer of medical monitoring devices, Broadway and Seymour, Inc., a
developer and vendor of computer software technologies, and Vestaur
Securities, Inc., a closed-end NYSE-listed mutual fund.
LYMAN C. HAMILTON, JR. - AGE 72
Director since 1995
Mr. Hamilton was elected a director of PolyVision in May 1995. Mr. Hamilton
is currently a private investor and served as President and Chief Executive
Officer of APV, Inc., a wholly-owned subsidiary of PolyVision that was engaged
in the research and development of a proprietary flat panel display technology,
from March 1991 to December 1992. From 1962 to 1979, Mr. Hamilton served in
various senior executive officer positions with ITT Corp. and was its Chief
Executive Officer in 1978 and 1979 and a director from 1974 to 1979. Mr.
Hamilton currently serves on the Board of Directors of Scan-Optics, Inc., a
manufacturer of optical character recognition equipment. Mr. Hamilton served on
Alpine's Board of Directors from 1991 to November 1993.
JOSEPH A. MENNITI - AGE 61
Director since 1998
Mr. Menniti was elected Chief Executive Officer of PolyVision in March 1998
and was elected a director of PolyVision in May 1998. He also served as
President and Chief Operating Officer of PolyVision from May 1995 to November
1998. Prior to joining PolyVision, from 1989 to May 1995, Mr. Menniti was the
Chief Executive Officer of DNE Systems, Inc., then a wholly-owned subsidiary of
Alpine, and currently a subsidiary of Superior TeleCom, which designs,
manufactures and markets electronic and communications products and systems for
the military, government and commercial sectors. Mr. Menniti held various
positions at Grumman Aerospace Corporation prior to 1989.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES
FOR DIRECTOR LISTED ABOVE.
7
<PAGE>
INFORMATION ABOUT BOARD
MEETINGS AND COMMITTEES, AND MANAGEMENT
There were three meetings of the Board of Directors during the fiscal year
ended December 31, 1998. Each incumbent director attended all of the Board of
Directors meetings and the meetings of Board Committees on which he served.
COMMITTEES OF THE BOARD
AUDIT COMMITTEE - During the fiscal year ended December 31, 1998, the Audit
Committee of PolyVision's Board of Directors consisted of Steven S. Elbaum,
Lyman C. Hamilton, Jr. and Stephen C. Knup. The Audit Committee met once during
the fiscal year ended December 31, 1998, at which it reviewed the financial
results of PolyVision and discussed the prospective audit for the fiscal year
ended December 31, 1998 with PolyVision's independent auditors. The Audit
Committee is primarily responsible for reviewing the services performed by
PolyVision's independent auditors and evaluating PolyVision's accounting
policies and its system of internal control.
COMPENSATION COMMITTEE - During the fiscal year ended December 31, 1998,
the Compensation Committee of PolyVision's Board of Directors consisted of
Ivan Berkowitz, Stephen C. Knup and Bragi F. Schut. The Compensation
Committee did not meet during the fiscal year ended December 31, 1998. The
Compensation Committee is primarily responsible for reviewing and approving
the salary and benefits policies of PolyVision, including compensation of
executive officers; however, in 1998, the full Board, rather than the
Compensation Committee, performed these functions.
STOCK OPTION COMMITTEE - During the fiscal year ended December 31, 1998,
the Stock Option Committee of PolyVision's Board of Directors consisted of Ivan
Berkowitz, Stephen C. Knup and Bragi F. Schut. The Stock Option Committee
administers the 1994 Stock Option Plan, and recommends and approves grants of
stock options under such plans. During the fiscal year ended December 31, 1998,
the Stock Option Committee did not meet. Options granted to Mr. Menniti were
approved by the entire Board of Directors as a whole.
DIRECTORS STOCK GRANT AND STOCK OPTION COMMITTEES - PolyVision's Board of
Directors does not have a separate Directors Stock Grant or Stock Option
Committee, but rather administers such plans as a whole.
NOMINATING COMMITTEE - PolyVision's Board of Directors does not have a
Nominating Committee, but rather performs these functions as a whole.
DIRECTOR COMPENSATION
In addition to grants made pursuant to PolyVision's 1995 Directors Stock
Option and Stock Grant Plans, non-employee directors receive $500 for each board
or committee meeting attended. All expenses in connection with attendance at
such meetings are paid by PolyVision.
8
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In May 1995, PolyVision entered into an agreement with Alpine, PolyVision's
largest single shareholder, pursuant to which PolyVision had the right to
borrow, prior to May 24, 1997, up to $5,000,000 from Alpine to be used by
PolyVision to fund its working capital needs, including research, development
and commercialization activities in connection with the flat panel display
technology of APV, Inc., a wholly-owned subsidiary of PolyVision. Borrowings
under the agreement were unsecured and accrued interest at a market rate
reflecting Alpine's cost of borrowing such funds (then approximately 8-1/2%),
with interest payable semiannually in cash. In April 1997, PolyVision entered
into an agreement with Alpine to borrow $811,000 to fund its corporate borrowing
requirements. Borrowings under this agreement were also at Alpine's cost of
borrowing such funds. PolyVision has historically relied upon the support of
Alpine to meet its working capital needs and financial commitments.
In November 1998, all indebtedness of PolyVision due Alpine was exchanged
for shares of PolyVision's common stock, and is no longer outstanding.
The Board of Directors of PolyVision and Alpine contain some of the same
members. See "Proposal No. 1: Election of Directors."
MANAGEMENT
The names and ages of the executive officers of PolyVision, and their
positions with PolyVision, are as follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Joseph A. Menniti................. 61 Chief Executive Officer
Michael H. Dunn................... 49 President and Chief Operating Officer
Richard J. Still.................. 49 Chief Financial Officer
Barry M. Puritz................... 56 Vice President of Business Development and
Secretary
</TABLE>
See "Nominees for Directors" above for certain biographical information
concerning Joseph A. Menniti and Michael H. Dunn.
RICHARD J. STILL was elected Chief Financial Officer of PolyVision in
November 1998, following PolyVision's acquisition of Alliance. Mr. Still had
served as Senior Vice President and Chief Financial Officer of Alliance since
January 1998. From 1982 to January 1998, Mr. Still served as a Director, Senior
Vice President - Finance, Treasurer and Secretary of Immucor, Inc., a healthcare
manufacturing company which he co-founded. Mr. Still has also held senior
financial positions with Cooper Laboratories, Inc. and the Ortho Diagnostics
division of Johnson & Johnson.
9
<PAGE>
BARRY M. PURITZ was elected Vice President of Marketing and Sales of
PolyVision in May 1998 and became its Vice President of Business Development and
Secretary in November 1998. Mr. Puritz served as the Executive Vice President,
Marketing and Sales of the Greensteel division of PolyVision from May 1997 to
May 1998. Mr. Puritz was the President of the VisCon division of Posterloid
Corporation, a wholly-owned subsidiary of PolyVision, from 1992 to May 1997, and
was responsible for its bank merchandising business and for the development of
new menuboard products for the restaurant business of Posterloid Corporation.
Mr. Puritz joined PolyVision in 1992 following PolyVision's purchase of VisCon,
Inc., which he founded.
No family relationship exists among any of the directors or executive
officers of PolyVision. No arrangement or understanding exists between any
director or executive officer and any other person pursuant to which any
director or executive officer was selected as a director or executive officer of
PolyVision. All executive officers are appointed annually by the Board of
Directors.
EXECUTIVE COMPENSATION AND RELATED MATTERS
The following table sets forth the cash compensation (including cash
bonuses) paid or accrued by PolyVision during the year ended December 31, 1998,
and during the two prior fiscal years ended April 30, 1998 and 1997, to its
Chief Executive Officer and to the only other executive officer of PolyVision
whose compensation exceeded $100,000 (the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
-------------------------------------- ---------------------------------
OTHER ANNUAL COMMON STOCK
NAME AND FISCAL BONUS COMPENSATION RESTRICTED UNDERLYING
PRINCIPAL POSITION YEAR ENDED(1) SALARY ($) ($) ($)(2) STOCK AWARDS (#) OPTIONS (#)
- --------------------------- ----------------- ----------- ----- ------------ ---------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Menniti December 31, 1998 222,800 130,000 -- -- 275,000
Chief Executive Officer April 30, 1998 205,900 67,000 -- -- 30,000
April 30, 1997 191,000 30,000 -- -- --
Barry M. Puritz December 31, 1998 107,100 29,300 -- -- 8,000
Vice President of April 30, 1998 109,400 30,000 -- -- 7,000
Business Development and April 30, 1997 107,400 -- -- -- --
Secretary
</TABLE>
(1) On December 30, 1998, PolyVision changed its fiscal year-end from
April 30 to December 31. Information presented for the fiscal year
ended December 31, 1998 reflects compensation paid or accrued by
PolyVision from January 1 to December 31, 1998. Compensation paid or
accrued from January 1 to April 30, 1998 is also reflected in the
information presented for the fiscal year ended April 30, 1998.
(2) The aggregate value of benefits to be reported under the "Other Annual
Compensation" column did not exceed the lesser of $50,000 or 10% of
the total of annual salary and bonus reported for the Named Executive
Officer.
10
<PAGE>
EMPLOYMENT AGREEMENTS
Pursuant to an Employment Agreement, dated as of May 1, 1995, between
PolyVision and Joseph A. Menniti, Mr. Menniti agreed initially to serve as the
President of PolyVision until either he or PolyVision elects to terminate such
employment upon prior written notice. Under the terms of his Employment
Agreement, Mr. Menniti receives an annual base salary, subject to annual reviews
for services rendered in such position, plus an annual bonus of a percentage of
his base salary in the event PolyVision achieves annual targeted performance
objectives set by PolyVision's Board of Directors. In November 1998, at the time
Mr. Menniti agreed to serve as the Chief Executive Officer of PolyVision, his
Employment Agreement was amended to, among other things, increase his annual
base salary to $260,000 and his annual bonus percentage to 50%.
In addition, pursuant to his Employment Agreement, PolyVision agreed to
grant to Mr. Menniti stock options to purchase 75,000 shares of PolyVision's
common stock at an exercise price of $3.82 (which was subsequently reduced to
$1.00) and vesting in five equal annual installments. Pursuant to the November
1998 amendment to Mr. Menniti's Employment Agreement, PolyVision agreed to grant
to Mr. Menniti additional stock options to purchase 175,000 shares of
PolyVision's common stock at an exercise price of $1.50 per share, vesting in
four equal annual installments. Under Mr. Menniti's Employment Agreement,
PolyVision also agreed to make restricted stock grants to Mr. Menniti in the
amount of 15,000 shares of PolyVision's common stock, to be held by PolyVision
and released at a rate of 3,000 shares per year. In addition, if Mr. Menniti's
employment is terminated by PolyVision for any reason other than for "Cause" (as
defined) or by Mr. Menniti for "Good Reason" (as defined), he is entitled to
payment of one and one-half times his salary if termination occurs after May 1,
1999, together with the annual bonus that he would have been entitled to had his
employment not been so terminated. Mr. Menniti has agreed not to compete with
PolyVision during his term of employment and for two years thereafter, and not
to disclose any part of PolyVision's proprietary technology at any time.
Pursuant to an Employment Agreement, dated as of November 20, 1998,
between PolyVision and Michael H. Dunn, Mr. Dunn agreed to serve as the
President and Chief Operating Officer of PolyVision until either he or
PolyVision elects to terminate such employment upon prior written notice.
Under the terms of his Employment Agreement, Mr. Dunn receives an annual base
salary of $240,000, plus an annual bonus equal to 45% of his base salary in
the event PolyVision achieves annual targeted performance objectives set by
PolyVision's Board of Directors. In addition, pursuant to his Employment
Agreement, PolyVision agreed to grant to Mr. Dunn stock options to purchase
250,000 shares of PolyVision's common stock at an exercise price of $1.50 per
share, vesting in four equal annual installments. Under his Employment
Agreement, if Mr. Dunn's employment is terminated by PolyVision for any
reason other than for "Cause" (as defined) or by Mr. Dunn for "Good Reason"
(as defined), he is entitled to payment of 100% of the balance of his salary
for the remaining period under his Employment Agreement and, if the date of
termination of his employment is more than six months into any particular
fiscal year, any discretionary bonus that he would have been entitled to had
his employment not been so terminated. Mr. Dunn has agreed not to compete
with PolyVision during his term of employment and for certain periods
thereafter, and not to disclose any part of PolyVision's proprietary
technology at any time.
Pursuant to an Employment Agreement, dated as of November 20, 1998, between
PolyVision and Richard J. Still, Mr. Still agreed to serve as the Chief
Financial Officer of PolyVision until either he or PolyVision elects to
terminate such employment upon prior written notice. Under the terms of his
Employment Agreement, Mr. Still receives an annual base salary of $175,000, plus
an annual bonus equal to 35% of his base salary in the event PolyVision achieves
annual targeted performance objectives set by PolyVision's Board of Directors.
In addition, pursuant to his Employment Agreement, PolyVision agreed to grant to
Mr. Still stock options to purchase 150,000 shares of PolyVision's common stock
at an exercise price of $1.50 per share, vesting in four equal annual
installments. Under his Employment Agreement,
11
<PAGE>
if Mr. Still's employment is terminated by PolyVision for any reason other
than for "Cause" (as defined) or by Mr. Still for "Good Reason" (as defined),
he is entitled to payment of 100% of the balance of his salary for the
remaining period under his Employment Agreement and, if the date of
termination of his employment is more than six months into any particular
fiscal year, any discretionary bonus that he would have been entitled to had
his employment not been so terminated. Mr. Still has agreed not to compete
with PolyVision during his term of employment and for a period of one year
thereafter, and not to disclose any part of PolyVision's proprietary
technology at any time.
STOCK OPTIONS
The following table sets forth information with respect to grants of
options to purchase common stock under PolyVision's 1994 Stock Option Plan to
the Named Executive Officers during the fiscal year ended December 31, 1998:
OPTION GRANTS IN FISCAL 1998
<TABLE>
<CAPTION>
% OF TOTAL POTENTIAL REALIZED
OPTIONS VALUE AT ASSUMED
GRANTED TO EXERCISE ANNUAL RATE OF STOCK
OPTIONS EMPLOYEES PRICE EXPIRATION APPRECIATION FOR
NAME GRANTED(1) IN FISCAL YEAR(2) ($/SH)(1) DATE OPTION TERM(3)
- ---- ----------- ----------------- --------- ---------- --------------------
5% 10%
-------- -------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Menniti 100,000 14.0% 1.25 May 2008 $ 79,000 $199,000
175,000 24.4% 1.50 Nov. 2008 $183,750 $418,250
Barry M. Puritz 8,000 1.1% 1.25 May 2008 $ 6,320 $ 15,920
</TABLE>
(1) All options were granted at or above market value on the date of
grant.
(2) Percentages based on total number of stock options granted to
employees during the fiscal year ended April 30, 1998 or the year
ended December 31, 1998, as applicable.
(3) These amounts represent certain assumed rates of appreciation only.
Actual gains, if any, on option exercises are dependent upon other
factors, including the future performance of the common stock and
overall stock market conditions.
12
<PAGE>
AGGREGATE OPTION EXERCISES DURING FISCAL 1998 AND FISCAL YEAR-END OPTION VALUES
The following table sets forth for the Named Executive Officers information
on options exercised, unexercised options and year-end option values in each
case with respect to options to purchase shares of PolyVision's common stock:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
SHARES VALUE UNDERLYING VALUE OF UNEXERCISED
ACQUIRED ON REALIZED UNEXERCISED OPTIONS AT IN THE MONEY OPTIONS
NAME EXERCISE(#) ($) DECEMBER 31, 1998(#) AT DECEMBER 31, 1998(1)
- --------------------- -------------- -------- ---------------------------- ---------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Joseph A. Menniti -0- -0- 138,333 241,667 $138,645 $152,605
Barry M. Puritz -0- -0- 5,000 10,000 $4,646 $9,292
</TABLE>
(1) Represents the difference between the last sale price of the common
stock on December 31, 1998 ($2-1/16), and the exercise price of the
option multiplied by the applicable number of options.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee of the Board of Directors were
Ivan Berkowitz, Stephen C. Knup and Bragi F. Schut during the fiscal year ended
December 31, 1998. No member of the Board of Directors or the Compensation
Committee has any interlocking relationship with any other corporation that
requires disclosure under this heading.
REPORT OF THE COMPENSATION COMMITTEE ON
EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors of
PolyVision was established in 1990 and did not hold any meetings during the
fiscal year ended December 31, 1998. The duties and responsibilities of the
Committee include the following:
(a) approval of annual salaries and other benefits provided for executive
officers of PolyVision;
(b) approval of the adoption of compensation plans in which the executive
officers of PolyVision may be participants and awarding of benefits
under such plans; and
(c) undertaking studies and making recommendations with respect to
PolyVision's compensation structure and policies and the development
of management personnel.
The Committee's policies with respect to executive compensation are
intended to achieve the following goals. First, they are intended to create base
compensation levels sufficient to attract and retain talented and dedicated
executive officers. Second, the compensation policies are intended to provide a
direct link between performance during the year (both the performance of
PolyVision as a whole and the performance of the individual officer) as a part
of the officer's compensation. Third, the compensation policies are intended to
provide executive officers with the opportunity to acquire an equity stake in
PolyVision through the grant of options pursuant to PolyVision's 1994 Stock
Option Plan.
13
<PAGE>
During the fiscal year ended December 31, 1998, the full Board approved
the various employment agreements and amendments discussed in "Executive
Compensation and Related Matters - Employment Agreements" above, as well as
approving bonuses and granting options to certain of its executive officers
and certain employees. In each case, the Board's decision was based upon the
principles and procedures outlined above.
COMPENSATION COMMITTEE
Ivan Berkowitz
Stephen C. Knup
Bragi F. Schut
The Report of the Compensation Committee on Executive Compensation shall
not be deemed incorporated by reference by any general statement incorporating
by reference this Proxy Statement into any filing under the Securities Act of
1933, as amended, or under the Exchange Act, except to the extent that
PolyVision specifically incorporates this information by reference, and shall
not otherwise be deemed filed under such acts.
SHAREHOLDER RETURN PERFORMANCE PRESENTATION
The following chart compares the value of $100 invested in PolyVision's
common stock from December 31, 1993 to December 31, 1998, with a similar
investment in the Dow Jones Equity Market Index and the Dow Jones Heavy
Construction Index.
COMPARISON OF CUMULATIVE TOTAL RETURN
AMONG POLYVISION CORPORATION, THE DOW JONES EQUITY MARKET INDEX
AND THE DOW JONES HEAVY CONSTRUCTION INDEX
<TABLE>
<CAPTION>
Cumulative Total Return
----------------------------------------------------------------------
12/93 12/94 12/95 4/96 4/97 4/98 12/98
----- ----- ----- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PolyVision Corporation PLI 100 91 20 20 2 13 20
Dow Jones Equity Market
Index 100 101 139 149 186 263 294
IDOW
Dow Jones Heavy
Construction Index ICON 100 96 134 137 124 116 100
</TABLE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires PolyVision's executive officers,
directors and holders of more than ten percent of PolyVision's common stock to
file with the Securities and Exchange Commission and The American Stock Exchange
initial reports of ownership and reports of changes in ownership of PolyVision's
common stock. Such persons are required by SEC regulations to furnish PolyVision
with copies of all Section 16(a) forms they file.
Based solely upon its review of the copies of such forms received by
PolyVision, or representations from certain reporting persons that no year-end
Forms 5 were required for those persons, PolyVision believes that, during the
fiscal year ended December 31, 1998, all filing requirements applicable to its
executive officers, directors and greater than ten percent beneficial owners
were complied with.
14
<PAGE>
PROPOSAL NO. 2
APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION
PolyVision's Restated Certificate of Incorporation, as currently in effect
(the "Certificate"), provides that PolyVision is authorized to issue two classes
of capital stock consisting of 25,000,000 shares of common stock, par value
$.001 per share, and 1,500,000 shares of Preferred Stock, par value $.01 per
share. In January 1999, the Board of Directors authorized an amendment to the
Certificate to increase the authorized number of shares of common stock to
40,000,000 shares. The shareholders are being asked to approve at the Annual
Meeting such amendment to the Certificate. Under the proposed amendment,
paragraph (a) of Article Fourth of the Certificate would be amended to read as
follows:
(a) The Corporation shall be authorized to issue the following shares:
<TABLE>
<CAPTION>
CLASS NUMBER OF SHARES PAR VALUE
----- ---------------- ---------
<S> <C> <C>
Common Stock 40,000,000 $.001
Preferred Stock 1,500,000 $.01
</TABLE>
PolyVision currently has 25,000,000 authorized shares of common stock. As
of December 31, 1998, 14,092,750 shares of common stock were issued and
outstanding. In addition, as of December 31, 1998, and without giving effect to
the proposed 1999 Stock Option Plan described in this Proxy Statement:
o 4,282,517 shares of common stock were reserved for issuance upon the
conversion of PolyVision's outstanding shares of Series B Preferred
Stock (representing a conversion price of $3.00 per share), exchanged
with Alpine and one other entity,
o 2,500,000 shares of common stock were reserved for issuance upon the
conversion of PolyVision's outstanding shares of Series C Preferred
Stock (representing a conversion price of $2.00 per share), sold to
Alpine,
o 2,666,667 shares of common stock were reserved for issuance upon the
conversion of PolyVision's 10% Convertible Subordinated Promissory
Note due 2007 issued to Wind Point Partners III, L.P. (representing a
conversion price of $3.00 per share),
o 2,986,467 shares of common stock were reserved for issuance upon the
exercise of outstanding warrants issued to John Hancock Mutual Life
Insurance Company and certain of its affiliates (exercisable at a
nominal price), and
o 400,000 shares of common stock were reserved for future grant or for
issuance upon the exercise of outstanding stock options under the 1994
Stock Option Plan; 125,000 shares of common stock were reserved for
future grant or issuance upon exercise of outstanding stock options
under the 1995 Directors Stock Option Plan; and 6,667 shares were
reserved for future grant under the 1995 Directors Stock Grant Plan.
15
<PAGE>
PURPOSE AND EFFECT OF THE AMENDMENT
The principal purpose of the proposed amendment to the Certificate is to
authorize additional shares of common stock which will be available upon the
conversion and exercise of the securities described above. In addition,
additional shares will be needed if the Board of Directors determines that it is
necessary or appropriate to permit future stock dividends or stock splits, to
raise additional capital through the sale of securities, to acquire another
company or its business or assets, or to establish a strategic relationship with
a corporate partner. The Board of Directors has no present agreement or
arrangement to issue any such shares. If the amendment is approved by the
shareholders, the Board of Directors does not intend to solicit further
shareholder approval prior to the issuance of any additional shares of common
stock, except as may be required by applicable law.
The increase in authorized common stock will not have any immediate effect
on the rights of existing shareholders. However, the Board will have the
authority to issue authorized common stock without requiring future shareholder
approval of such issuances, except as may be required by applicable law. To the
extent that the additional authorized shares are issued in the future, they will
decrease the existing shareholders' percentage equity ownership and, depending
on the price at which they are issued, could be dilutive to the existing
shareholders. The holders of common stock have no preemptive rights to purchase
any shares of common stock which may be offered in the future.
POTENTIAL ANTI-TAKEOVER EFFECT
The increase in the authorized number of shares of common stock and the
subsequent issuance of such shares could have the effect of delaying or
preventing a change in control of PolyVision without further action by the
shareholders. Shares of authorized and unissued common stock could (within the
limits imposed by applicable law) be issued in one or more transactions which
would make a change in control of PolyVision more difficult, and therefore less
likely. Any such issuance of additional stock could have the effect of diluting
the earnings per share and book value per share of outstanding shares of common
stock, and such additional shares could be used to dilute the stock ownership or
voting rights of a person seeking to obtain control of PolyVision. PolyVision
has previously adopted certain measures that may have the effect of helping to
resist an unsolicited takeover attempt, including a staggered board and "blank
check" preferred stock.
REQUIRED VOTE
The approval of the amendment to the Certificate requires the affirmative
vote of a majority of the outstanding shares of common stock of PolyVision. An
abstention or non-vote is not an affirmative vote and, therefore, will have the
same effect as a vote against the proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE AMENDMENT TO THE
CERTIFICATE.
16
<PAGE>
PROPOSAL NO. 3
APPROVAL AND RATIFICATION OF 1999 STOCK OPTION PLAN
BACKGROUND AND PURPOSE
In January 1999, the Board of Directors adopted the PolyVision Corporation
1999 Stock Option Plan (the "Plan") and recommended that it be submitted to
PolyVision's shareholders for their approval at the Annual Meeting. The purpose
of the Plan is to provide an additional incentive to attract and retain
qualified competent persons who provide services and upon whose efforts and
judgment the success of PolyVision is largely dependent, through the
encouragement of stock ownership in PolyVision by such persons. In furtherance
of this purpose, the Plan authorizes, among other things, (a) the granting of
incentive or nonqualified stock options to purchase common stock (collectively,
"Options") to persons selected by the administrators of the Plan from the class
of all regular employees of PolyVision, including officers who are regular
employees and directors, (b) the provision of loans for the purposes of
financing the exercise of Options and the amount of taxes payable in connection
therewith, and (c) the use of already owned common stock as payment of the
exercise price for Options granted under the Plan.
Shareholder approval of the Plan is required (i) for purposes of
compliance with certain exclusions from the limitations of Section 162(m) of
the Internal Revenue Code of 1986, as amended, and (ii) by the rules of the
American Stock Exchange, where PolyVision's common stock is traded.
The effective date of the Plan is January 26, 1999 (the "Effective
Date"). In October 1998, PolyVision's Board of Directors awarded, subject to
and conditioned on completion of the Alliance purchase and approval of the
Plan by PolyVision's shareholders at the Annual Meeting, non-qualified stock
options under the Plan to the following persons:
NEW PLAN BENEFITS
<TABLE>
<CAPTION>
Name and Position Dollar Value (1) Number of Options (2)
- ----------------- ---------------- ---------------------
<S> <C> <C>
Joseph A. Menniti $186,025 175,000
Chief Executive Officer
Michael H. Dunn $265,750 250,000
President and Chief
Operating Officer
Richard J. Still $159,450 150,000
Chief Financial Officer
-------- -------
All Employees $611,225 575,000
as a group
</TABLE>
- ----------------
(1) Represents the closing price of PolyVision's common stock on March 26,
1999 ($2-9/16 per share), minus the exercise price of the options. On
October 8, 1998, the date the options were awarded, the closing price
of PolyVision's common stock, as reported by the American Stock Exchange,
was $1-3/8 per share.
(2) All of the stock options provide for an exercise price of $1.50 per share,
are exercisable at the rate of 25% of the number of options granted in
each of November 1999, 2000 and 2002 and, unless exercised, expire in
November 2008 (subject to prior termination in accordance with their
applicable stock option agreement).
No other stock options under the Plan have been granted or are othewise
contemplated at this time.
The following is a summary of certain principal features of the Plan. This
summary is qualified in its entirety by reference to the complete text of the
Plan, which is attached to this Proxy Statement as Exhibit A. Shareholders are
urged to read the actual text of the Plan in its entirety.
ADMINISTRATION OF THE PLAN
The Plan provides that it shall be administered by
- the Board of Directors of PolyVision (the "Board") or
- by a committee appointed by the Board (the "Committee"), which shall be
composed of two or more directors, all of whom shall be "outside
directors" (as defined in the Plan),
in compliance with Rule 16b-3 of the Exchange Act and Section 162(m) of the
Code (although Rule 16b-3 may also be complied with if option grants are
approved by the Board).
The Committee or the Board in its sole discretion determines the persons to
be awarded Options, the number of shares subject thereto and the exercise price
and other terms thereof. In addition, the Committee or the Board has full power
and authority to construe and interpret the Plan, and the acts of the Committee
or the Board are final, conclusive and binding on all interested parties,
including
17
<PAGE>
PolyVision, its shareholders, officers and employees, recipients of grants under
the Plan, and all persons or entities claiming by or through such persons.
An aggregate of 1,000,000 shares of common stock (subject to adjustment
described below) are reserved for issuance upon the exercise of Options granted
under the Plan. The shares acquired upon exercise of Options granted under the
Plan will be authorized and issued shares of common stock. PolyVision's
shareholders will not have any preemptive rights to purchase or subscribe for
any common stock by reason of the reservation and issuance of common stock under
the Plan. If any Option granted under the Plan should expire or terminate for
any reason other than having been exercised in full, the unpurchased shares
subject to that Option will again be available for purposes of the Plan.
CERTAIN TERMS AND CONDITIONS
All Options granted under the Plan must be evidenced by a written agreement
between PolyVision and the grantee. The agreement will contain such terms and
conditions as the Committee or the Board shall prescribe, consistent with the
Plan, including, without limitation, the exercise price, term and any
restrictions on the exercisability of the Options granted.
For any Option granted under the Plan, the exercise price per share of
common stock may be any price determined by the Committee or the Board; however,
the exercise price per share of any Incentive Stock Option may not be less than
the Fair Market Value of the common stock on the date such Incentive Stock
Option is granted. For purposes of the Plan, the "Fair Market Value" on any date
of reference is deemed to be the closing price of common stock on the business
day immediately preceding such date, unless the Committee or the Board in its
sole discretion determines otherwise in a fair and uniform manner. For this
purpose, the closing price of common stock on any business day is (i) if common
stock is listed or admitted for trading on any United States national securities
exchange, or if actual transactions are otherwise reported on a consolidated
transaction reporting system, the last reported sale price of common stock on
such exchange or reporting system, as reported in any newspaper of general
circulation; (ii) if common stock is quoted on the National Association of
Securities Dealers Automated Quotation System ("Nasdaq"), or any similar system
of automated dissemination of quotations of securities prices in common use, the
mean between the closing high bid and low asked quotations for such day of
common stock on such system; or (iii) if neither clause (i) nor (ii) is
applicable, the mean between the high bid and low asked quotations for common
stock as reported by the National Quotation Bureau, Incorporated if at least two
securities dealers have inserted both bid and asked quotations for common stock
on at least 5 of the 10 preceding days. The closing price of PolyVision's common
stock on March 26, 1999, as reported by the American Stock Exchange, was $2-9/16
per share.
The Committee or the Board may permit the exercise price of an Option to be
paid for in cash, by certified or official bank check or personal check, by
money order, with already owned shares of common stock that have been held by
the Optionee for at least six (6) months (or such other shares as PolyVision
determines will not cause PolyVision to recognize for financial accounting
purposes a charge for compensation expense), the withholding of shares of common
stock issuable upon exercise of the Option, by delivery of a properly executed
exercise notice together with such documentation as shall be required by the
Committee or the Board (or, if applicable, the broker) to effect a cashless
exercise, or a combination of the above. If paid in whole or in part with shares
of already owned common stock, the value of the shares surrendered is deemed to
be their Fair Market Value on the date the Option is exercised. The Plan also
authorizes PolyVision to lend money to an Optionee, guarantee a loan to an
Optionee, or otherwise assist an Optionee to obtain the cash necessary to
exercise all or a portion of the Option granted thereunder or to pay any tax
liability of the Optionee attributable to such exercise. If the exercise price
is paid in whole or part with the Optionee's promissory note, such note shall
(i) provide for full recourse to the maker, (ii) be collateralized by the pledge
of the shares that the Optionee purchases
18
<PAGE>
upon exercise of such Option, (iii) bear interest at the prime rate of
PolyVision's principal lender or such other rate as the Committee or the Board,
as the case may be, shall determine, and (iv) contain such other terms as the
Committee or the Board in its sole discretion shall reasonably require.
The use of already owned shares of common stock applies to payment for the
exercise of an Option in a single transaction and to the "pyramiding" of already
owned shares in successive, simultaneous Option exercises. In general,
pyramiding permits an Option holder to start with as little as one share of
common stock and exercise an entire Option to the extent then exercisable (no
matter what the number of shares subject thereto). By utilizing already owned
shares of common stock, no cash (except for fractional share adjustments) is
needed to exercise an Option. Consequently, the Optionee would receive common
stock equal in value to the spread between the fair market value of the shares
subject to the Option and the exercise price of such Option.
No incentive stock option and, unless the prior written consent of the
Committee or the Board is obtained (which consent may be withheld for any
reason) and the transaction does not violate the requirement of Rule 16b-3
under the Exchange Act, no non-qualified stock option, granted under the Plan
is assignable or transferable, other than by will or by the laws of descent
and distribution. During the lifetime of an Optionee, an Option is
exercisable only by him or her, or in the case of a non-qualified stock
option, by his permitted assignee. The expiration date of an Option under the
Plan will be determined by the Committee or the Board at the time of grant,
but in no event may such an Option be exercisable after 10 years from the
date of grant. An Option may be exercised at any time or from time to time or
only after a period of time in installments, as the Committee or the Board
determines. The Committee or the Board may in its sole discretion accelerate
the date on which any Option may be exercised. Each outstanding Option
granted under the Plan may become immediately fully exercisable in the event
of certain transactions, including certain changes in control of PolyVision,
certain mergers and reorganizations, and certain dispositions of
substantially all PolyVision's assets.
Unless otherwise provided in the Option agreement, the unexercised portion
of any Option granted under the Plan shall automatically be terminated (a) three
months after the date on which the Optionee's employment is terminated for any
reason other than (i) Cause (as defined in the Plan), (ii) mental or physical
disability, or (iii) death; (b) immediately upon the termination of the
Optionee's employment for Cause; (c) one year after the date on which the
Optionee's employment is terminated by reason of mental or physical disability;
or (d) one year after the date on which the Optionee's employment is terminated
by reason of Optionee's death, or if later, three months after the date of
Optionee's death if death occurs during the one year period following the
termination of the Optionee's employment by reason of mental or physical
disability.
To prevent dilution of the rights of a holder of an Option, the Plan
provides for appropriate adjustment of the number of shares for which Options
may be granted, the number of shares subject to outstanding Options and the
exercise price of outstanding Options, in the event of any increase or decrease
in the number of issued and outstanding shares of PolyVision's capital stock
resulting from a stock dividend, stock split, share combination,
recapitalization or other capital adjustment of PolyVision. The Committee or the
Board has discretion to make appropriate antidilution adjustments to outstanding
Options in the event of a merger, consolidation or other reorganization of
PolyVision or a sale or other disposition of substantially all of PolyVision's
assets.
The Plan will expire on January 26, 2009, and any Option outstanding on
such date will remain outstanding until it expires or is exercised. The
Committee or the Board may amend, suspend or terminate the Plan or any Option at
any time, provided that such amendment shall be subject to the approval of
PolyVision's shareholders if such shareholder approval is required by any
federal or state law or regulation (including, without limitation, Rule 16b-3 or
to comply with Section 162(m) of the Code) or the rules of any stock exchange or
automated quotation system on which the common stock may then be listed or
granted. In addition, no amendment, suspension or termination shall
substantially impair the
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rights or benefits of any Optionee, pursuant to any Option previously granted,
without the consent of the Optionee.
FEDERAL INCOME TAX CONSEQUENCES OF AWARDS OF OPTIONS
The Plan is not qualified under the provisions of section 401(a) of the
Code, and is not subject to any of the provisions of the Employee Retirement
Income Security Act of 1974, as amended.
NONQUALIFIED STOCK OPTIONS. On exercise of a nonqualified stock option
granted under the Plan, an Optionee will recognize ordinary income equal to the
excess, if any, of the fair market value on the date of exercise of the shares
of common stock acquired on exercise of the Option over the exercise price. If
the Optionee is an employee of PolyVision, that income will be subject to the
withholding of Federal income tax. The Optionee's tax basis in those shares will
be equal to their fair market value on the date of exercise of the Option, and
his holding period for those shares will begin on that date.
If an Optionee pays for shares of common stock on exercise of an Option by
delivering shares of PolyVision's common stock, the Optionee will not recognize
gain or loss on the shares delivered, even if their fair market value at the
time of exercise differs from the Optionee's tax basis in them. The Optionee,
however, otherwise will be taxed on the exercise of the Option in the manner
described above as if he had paid the exercise price in cash. If a separate
identifiable stock certificate is issued for that number of shares equal to the
number of shares delivered on exercise of the Option, the Optionee's tax basis
in the shares represented by that certificate will be equal to his tax basis in
the shares delivered, and his holding period for those shares will include his
holding period for the shares delivered. The Optionee's tax basis and holding
period for the additional shares received on exercise of the Option will be the
same as if the Optionee had exercised the Option solely in exchange for cash.
PolyVision will be entitled to a deduction for Federal income tax purposes
equal to the amount of ordinary income taxable to the Optionee, provided that
amount constitutes an ordinary and necessary business expense for PolyVision and
is reasonable in amount, and either the employee includes that amount in income
or PolyVision timely satisfies its reporting requirements with respect to that
amount.
INCENTIVE STOCK OPTIONS. The Plan provides for the grant of stock options
that qualify as "incentive stock options" as defined in section 422 of the Code.
Under the Code, an Optionee generally is not subject to tax upon the grant or
exercise of an incentive stock option. In addition, if the Optionee holds a
share received on exercise of an incentive stock option for at least two years
from the date the Option was granted and at least one year from the date the
Option was exercised (the "Required Holding Period"), the difference, if any,
between the amount realized on a sale or other taxable disposition of that share
and the holder's tax basis in that share will be long-term capital gain or loss.
If, however, an Optionee disposes of a share acquired on exercise of an
incentive stock option before the end of the Required Holding Period (a
"Disqualifying Disposition"), the Optionee generally will recognize ordinary
income in the year of the Disqualifying Disposition equal to the excess, if any,
of the fair market value of the share on the date the incentive stock option was
exercised over the exercise price. If, however, the Disqualifying Disposition is
a sale or exchange on which a loss, if realized, would be recognized for Federal
income tax purposes, and if the sales proceeds are less than the fair market
value of the share on the date of exercise of the Option, the amount of ordinary
income recognized by the Optionee will not exceed the gain, if any, realized on
the sale. If the amount realized on a Disqualifying Disposition exceeds the fair
market value of the share on the date of exercise of the Option, that excess
will be short-term or long-term capital gain, depending on whether the holding
period for the share exceeds one year.
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An Optionee who exercises an incentive stock option by delivering shares of
common stock acquired previously pursuant to the exercise of an incentive stock
option before the expiration of the Required Holding Period for those shares is
treated as making a Disqualifying Disposition of those shares. This rule
prevents "pyramiding" the exercise of an incentive stock option (that is,
exercising an incentive stock option for one share and using that share, and
others so acquired, to exercise successive incentive stock options) without the
imposition of current income tax.
For purposes of the alternative minimum tax, the amount by which the fair
market value of a share of common stock acquired on exercise of an incentive
stock option exceeds the exercise price of that Option generally will be an
adjustment included in the Optionee's alternative minimum taxable income for the
year in which the Option is exercised. If, however, there is a Disqualifying
Disposition of the share in the year in which the Option is exercised, there
will be no adjustment with respect to that share. If there is a Disqualifying
Disposition in a later year, no income with respect to the Disqualifying
Disposition is included in the Optionee's alternative minimum taxable income for
that year. In computing alternative minimum taxable income, the tax basis of a
share acquired on exercise of an incentive stock option is increased by the
amount of the adjustment taken into account with respect to that share for
alternative minimum tax purposes in the year the Option is exercised.
PolyVision is not allowed an income tax deduction with respect to the grant
or exercise of an incentive stock option or the disposition of a share acquired
on exercise of an incentive stock option after the Required Holding Period.
However, if there is a Disqualifying Disposition of a share, PolyVision is
allowed a deduction in an amount equal to the ordinary income includible in
income by the Optionee, provided that amount constitutes an ordinary and
necessary business expense for PolyVision and is reasonable in amount, and
either the employee includes that amount in income or PolyVision timely
satisfies its reporting requirements with respect to that amount.
SECTION 162 LIMITATIONS. The Omnibus Budget Reconciliation Act of 1993
added Section 162(m) to the Code, which generally disallows a public company's
tax deduction for compensation to covered employees in excess of $1 million in
any tax year beginning on or after January 1, 1994. Compensation that qualifies
as "performance-based compensation" is excluded from the $1 million
deductibility cap, and therefore remains fully deductible by PolyVision that
pays it. PolyVision intends that Options granted to employees, whom the
Committee expects to be covered employees at the time a deduction arises in
connection with such Options, will qualify as such "performance-based
compensation," so that such Options will not be subject to the Section 162(m)
deductibility cap of $1 million. Future changes in Section 162(m) or the
regulations thereunder may adversely affect the ability of PolyVision to ensure
that Options under the Plan will qualify as "performance-based compensation"
that is fully deductible by PolyVision under Section 162(m).
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL AND
RATI-FICATION OF THE 1999 STOCK OPTION PLAN.
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PROPOSAL NO. 4
AUTHORIZATION AND APPROVAL OF THE ISSUANCE OF WARRANTS TO PURCHASE COMMON STOCK,
AND THE POSSIBLE ISSUANCE OF COMMON STOCK UNDERLYING SUCH WARRANTS, WHICH WOULD
REPRESENT 20% OR MORE OF THE OUTSTANDING SHARES OF COMMON STOCK
On December 30, 1998, PolyVision completed the refinancing of the
$25,000,000 loan made to PolyVision by Fleet Corporate Finance, Inc. ("Fleet")
in November 1998 in connection with the Alliance acquisition. Such loan was
evidenced by a 12.5% Senior Subordinated Note in the aggregate principal amount
of $25,000,000 (the "Fleet Note").
PolyVision refinanced the Fleet Note through the issuance of 12.5% Senior
Subordinated Notes in the aggregate principal amount of $25,000,000 (the
"Hancock Notes") to John Hancock Mutual Life Insurance Company and affiliates
(collectively, "John Hancock") pursuant to a Senior Subordinated Note and
Warrant Purchase Agreement (the "Subordinated Note Agreement"). Under the
Subordinated Note Agreement, John Hancock purchased from PolyVision the Hancock
Notes and warrants to purchase up to 2,986,467 shares of PolyVision's common
stock at an exercise price of $.001 per share, or an aggregate exercise price
of $2,986 (the "warrants"). On December 30, 1998, the closing price of
PolyVision's common stock was $1.75 per share.
If the warrants were exercised in full, the 2,986,467 shares of common
stock issuable upon such exercise would represent approximately 21.2% of the
outstanding shares of common stock before giving effect to such exercise.
This number of shares presents substantial dilution to current PolyVision
shareholders and may have an adverse effect on the market price of
PolyVision's common stock.
AMERICAN STOCK EXCHANGE VOTING REQUIREMENTS
The common stock is traded on the American Stock Exchange ("Amex"). The
Amex market rules require shareholder approval as a prerequisite to approval of
applications to list additional shares to be issued in connection with, among
other things, the sale or issuance by a company of common stock (or securities
convertible into common stock) equal to 20% or more of presently outstanding
stock for less than the greater of book or market value of the stock.
Since the exercise price of the warrants is nominal and the full exercise
of the warrants would result in the issuance by PolyVision of approximately
21.2% of presently outstanding shares of common stock, the shareholders must
vote in favor of this Proposal No. 4 in order for the shares of common stock
underlying the warrants to be approved for listing on the Amex.
REQUIRED VOTE
The authorization and approval of the issuance of the warrants to purchase
common stock, and the possible issuance of common stock underlying such
warrants, requires the affirmative vote of a majority of the outstanding shares
of common stock of PolyVision. An abstention or non-vote is not an affirmative
vote and, therefore, will have the same effect as a vote against the proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE ISSUANCE
OF WARRANTS TO PURCHASE COMMON STOCK, AND THE POSSIBLE ISSUANCE OF COMMON STOCK
UNDERLYING SUCH WARRANTS, WHICH WOULD REPRESENT 20% OR MORE OF THE OUTSTANDING
SHARES OF COMMON STOCK.
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PROPOSAL NO. 5
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR
Upon recommendation by the Audit Committee, the Board of Directors has
appointed Arthur Andersen LLP as PolyVision's independent auditor for the year
ended December 31, 1998. Representatives of that firm will be present at the
Annual Meeting to respond to appropriate questions and will be given an
opportunity to make a statement if they so desire. As previously reported, in
December 1998, the Board of Directors of PolyVision determined to change the
fiscal year end of PolyVision from April 30 to December 31 of each year,
commencing with the fiscal year ended December 31, 1998.
Shareholders are being asked to ratify the appointment of Arthur Andersen
LLP as PolyVision's independent auditor for the year ended December 31, 1998.
If the shareholders do not ratify the appointment of Arthur Andersen LLP as
PolyVision's independent auditors, the Board of Directors will consider
selecting another accounting firm.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ABOVE PROPOSAL.
PROPOSALS OF SHAREHOLDERS
Under certain circumstances, shareholders are entitled to present proposals
for consideration at shareholders meetings. Any such proposal to be included in
the proxy statement for PolyVision's 1999 Annual Meeting of Shareholders must be
submitted to the Secretary of PolyVision prior to January 31, 2000. It is
suggested that such proposals be sent by Certified Mail, Return Receipt
Requested.
WHERE YOU CAN FIND MORE INFORMATION
PolyVision files annual, quarterly and special reports, proxy statements
and other information with the SEC. You may read and copy any document
PolyVision files at the public reference facilities of the SEC in Washington,
D.C., Chicago, Illinois and New York, New York. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms.
PolyVision's SEC filings are also available to the public from the SEC's web
site at http://www.sec.gov.
The SEC allows PolyVision to "incorporate by reference" the information
PolyVision has filed with it, which means that PolyVision can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this proxy
statement. PolyVision incorporates by reference the following documents,
which contain important information about PolyVision and its finances:
(1) Transition Report Form 10-K for the eight months ended
December 31, 1998;
(2) Annual Report on Form 10-K for the fiscal year ended
April 30, 1998;
(3) Quarterly Reports on Form 10-Q for the three months ended
July 31, 1998 and the six months ended October 31, 1998; and
(4) Current Reports on Form 8-K, as amended, reporting
events which occurred on May 19, 1998, November 20, 1998 and
December 30, 1998.
You may request a copy of these filings, at no cost, by writing or
telephoning PolyVision at the following address:
PolyVision Corporation
48-62 36th Street
Long Island City, New York 11101
Attn: Mr. Barry M. Puritz
Vice President of Business Development Secretary
Tel: (718) 433-2170
OTHER MATTERS WHICH MAY COME BEFORE THE ANNUAL MEETING
PolyVision knows of no other matters to be presented at the Annual Meeting,
but if any other matters should properly come before the meeting, it is intended
that the persons named in the accompanying form of proxy will vote the same in
accordance with their best judgment and their discretion, and authority to do so
is included in the proxy.
By Order of the Board of Directors
BARRY M. PURITZ
VICE PRESIDENT OF BUSINESS DEVELOPMENT
AND SECRETARY
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EXHIBIT A
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POLYVISION CORPORATION
1999 STOCK OPTION PLAN
---------------------------------------
1. PURPOSE. The purpose of this Plan is to advance the interests of
PolyVision Corporation, a New York corporation ("PolyVision"), and its
Subsidiaries by providing an additional incentive to attract and retain
qualified and competent persons who provide services to PolyVision and its
Subsidiaries, and upon whose efforts and judgment the success of PolyVision and
its Subsidiaries is largely dependent, through the encouragement of stock
ownership in PolyVision by such persons.
2. DEFINITIONS. As used herein, the following terms shall have the meaning
indicated:
(a) "Board" shall mean the Board of Directors of PolyVision.
(b) "Committee" shall mean the committee appointed by the Board pursuant
to Section 13(a) hereof.
(c) "Common Stock" shall mean PolyVision's common stock, par value $.001
per share.
(d) "Director" shall mean a member of the Board.
(e) "Fair Market Value" of a Share on any date of reference shall mean the
"Closing Price" (as defined below) of the common stock on the business
day immediately preceding such date, unless the Committee or the Board
in its sole discretion shall determine otherwise in a fair and uniform
manner. For the purpose of determining Fair Market Value, the "Closing
Price" of the common stock on any business day shall be (i) if the
common stock is listed or admitted for trading on any United States
national securities exchange, or if actual transactions are otherwise
reported on a consolidated transaction reporting system, the last
reported sale price of common stock on such exchange or reporting
system, as reported in any newspaper of general circulation, (ii) if
the common stock is quoted on the National Association of Securities
Dealers Automated Quotation System ("NASDAQ"), or any similar system
of automated dissemination of quotations of securities prices in
common use, the last reported sale price of common stock on such
system or, if sales prices are not reported, the mean between the
closing high bid and low asked quotations for such day of common stock
on such system, as reported in any newspaper of general circulation or
(iii) if neither clause (i) or (ii) is applicable, the mean between
the high bid and low asked quotations for the common stock as reported
by the National Quotation Bureau, Incorporated if at least two
securities dealers have inserted both bid and asked quotations for
common stock on at least five of the ten preceding days. If neither
(i), (ii), or (iii) above is applicable, then Fair Market Value shall
be determined in good faith by the Committee or the Board in a fair
and uniform manner.
(f) "Incentive Stock Option" shall mean an incentive stock option as
defined in Section 422 of the Internal Revenue Code.
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(g) "Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(h) "Non-Qualified Stock Option" shall mean an Option which is not an
Incentive Stock Option.
(i) "Officer" shall mean PolyVision's Chairman of the Board, President,
Chief Executive Officer, principal financial officer, principal
accounting officer, any vice-president of PolyVision in charge of a
principal business unit, division or function (such as sales,
administration or finance), any other officer who performs a
policy-making function, or any other person who performs similar
policy-making functions for PolyVision. Officers of Subsidiaries shall
be deemed Officers of PolyVision if they perform such policy-making
functions for PolyVision. As used in this paragraph, the phrase
"policy-making function" does not include policy-making functions that
are not significant. If pursuant to Item 401(b) of Regulation S-K (17
C.F.R. ss. 229.401(b)), PolyVision identifies a person as an
"executive officer," the person so identified shall be deemed an
"Officer" even though such person may not otherwise be an "Officer"
pursuant to the foregoing provisions of this paragraph.
(j) "Option" (when capitalized) shall mean any option granted under this
Plan.
(k) "Optionee" shall mean a person to whom a stock option is granted under
this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(l) "Outside Director" shall mean a member of the Board who qualifies as
an "outside director" under Section 162(m) of the Internal Revenue
Code and the regulations thereunder and as a "Non-Employee Director"
under Rule 16b-3 promulgated under the Securities Exchange Act.
(m) "Plan" shall mean this 1999 Stock Option Plan for PolyVision.
(n) "Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.
(o) "Share" shall mean a share of common stock.
(p) "Subsidiary" shall mean any corporation (other than PolyVision) in any
unbroken chain of corporations beginning with PolyVision if, at the
time of the granting of the Option, each of the corporations other
than the last corporation in the unbroken chain owns stock possessing
50 percent or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
3. SHARES AVAILABLE FOR OPTION GRANTS. The Committee or the Board may grant
to Optionees from time to time Options to purchase an aggregate of up to One
Million (1,000,000) Shares from PolyVision's authorized and unissued Shares. If
any Option granted under the Plan shall terminate, expire, or be cancelled or
surrendered as to any Shares, new Options may thereafter be granted covering
such Shares.
4. INCENTIVE AND NON-QUALIFIED OPTIONS.
(a) An Option granted hereunder shall be either an Incentive Stock
Option or a Non-Qualified Stock Option as determined by the Committee or the
Board at the time of grant of such Option and shall clearly state whether it is
an Incentive Stock Option or a Non-Qualified Stock Option. All
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Incentive Stock Options shall be granted within 10 years from the effective date
of this Plan. Incentive Stock Options may not be granted to any person who is
not an employee of PolyVision or any Subsidiary.
(b) Options otherwise qualifying as Incentive Stock Options hereunder
will not be treated as Incentive Stock Options to the extent that the aggregate
fair market value (determined at the time the Option is granted) of the Shares,
with respect to which Options meeting the requirements of Section 422(b) of the
Internal Revenue Code are exercisable for the first time by any individual
during any calendar year (under all plans of PolyVision and its parent and
subsidiary corporations as defined in Section 424 of the Internal Revenue Code),
exceeds $100,000.
5. CONDITIONS FOR GRANT OF OPTIONS.
(a) Each Option shall be evidenced by an option agreement that may
contain any term deemed necessary or desirable by the Committee or the Board,
provided such terms are not inconsistent with this Plan or any applicable law.
Optionees shall be (i) those persons selected by the Committee or the Board from
the class of all regular employees of , or persons who provide consulting or
other services as independent contractors to, PolyVision or its Subsidiaries,
including Directors and Officers who are regular employees, and (ii) Directors
who are not employees of PolyVision or of any Subsidiaries. Any person who files
with the Committee or the Board, in a form satisfactory to the Committee or the
Board, a written waiver of eligibility to receive any Option under this Plan
shall not be eligible to receive any Option under this Plan for the duration of
such waiver.
(b) In granting Options, the Committee or the Board shall take into
consideration the contribution the person has made to the success of PolyVision
or its Subsidiaries and such other factors as the Committee or the Board shall
determine. The Committee or the Board shall also have the authority to consult
with and receive recommendations from officers and other personnel of PolyVision
and its Subsidiaries with regard to these matters. The Committee or the Board
may from time to time in granting Options under the Plan prescribe such other
terms and conditions concerning such Options as it deems appropriate, including,
without limitation, (i) prescribing the date or dates on which the Option
becomes exercisable, (ii) providing that the Option rights accrue or become
exercisable in installments over a period of years, or upon the attainment of
stated goals or both, or (iii) relating an Option to the continued employment of
the Optionee for a specified period of time, provided that such terms and
conditions are not more favorable to an Optionee than those expressly permitted
herein.
(c) The Options granted to employees under this Plan shall be in
addition to regular salaries, pension, life insurance or other benefits related
to their employment with PolyVision or its Subsidiaries. Neither the Plan nor
any Option granted under the Plan shall confer upon any person any right to
employment or continuance of employment by PolyVision or its Subsidiaries.
(d) Notwithstanding any other provision of this Plan, an Incentive
Stock Option shall not be granted to any person owning directly or indirectly
(through attribution under Section 424(d) of the Internal Revenue Code) at the
date of grant, stock possessing more than 10% of the total combined voting power
of all classes of stock of PolyVision (or of its parent or subsidiary
corporation (as defined in Section 424 of the Internal Revenue Code) at the date
of grant) unless the option price of such Option is at least 110% of the Fair
Market Value of the Shares subject to such Option on the date the Option is
granted, and such Option by its terms is not exercisable after the expiration of
five years from the date such Option is granted.
(e) Notwithstanding any other provision of this Plan, and in addition
to any other requirements of this Plan, the aggregate number of Options granted
to any one Optionee may not exceed 500,000 Options, subject to adjustment as
provided in Section 10 hereof.
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6. OPTION PRICE. The option price per Share of any Option shall be any
price determined by the Committee or the Board but shall not be less than the
par value per Share; provided, however, that in no event shall the option price
per Share of any Incentive Stock Option be less than the Fair Market Value of
the Shares underlying such Option on the date such Option is granted.
7. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i)
PolyVision has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Committee or the Board in its sole discretion have
been made for the Optionee's payment to PolyVision of the amount that is
necessary for PolyVision or Subsidiary employing the Optionee to withhold in
accordance with applicable Federal or state tax withholding requirements. The
consideration to be paid for the Shares to be issued upon exercise of an Option
as well as the method of payment of the exercise price and of any withholding
and employment taxes applicable thereto, shall be determined by the Committee or
the Board and may in the discretion of the Committee or the Board consist of:
(1) cash, (2) certified or official bank check, (3) money order, (4) Shares that
have been held by the Optionee for at least six (6) months (or such other Shares
as PolyVision determines will not cause PolyVision to recognize for financial
accounting purposes a charge for compensation expense), (5) the withholding of
Shares issuable upon exercise of the Option, (6) pursuant to a "cashless
exercise" procedure, by delivery of a properly executed exercise notice together
with such other documentation, and subject to such guidelines, as the Board or
the Committee shall require to effect an exercise of the Option and delivery to
PolyVision by a licensed broker acceptable to PolyVision of proceeds from the
sale of Shares or a margin loan sufficient to pay the exercise price and any
applicable income or employment taxes, or (7) in such other consideration as the
Committee or the Board deems appropriate, or by a combination of the above. In
the case of an Incentive Stock Option, the permissible methods of payment shall
be specified at the time the Option is granted. The Committee or the Board in
its sole discretion may accept a personal check in full or partial payment of
any Shares. If the exercise price is paid in whole or in part with Shares, or
through the withholding of Shares issuable upon exercise of the Option, the
value of the Shares surrendered or withheld shall be their Fair Market Value on
the date the Option is exercised. PolyVision in its sole discretion may, on an
individual basis or pursuant to a general program established in connection with
this Plan, lend money to an Optionee, guarantee a loan to an Optionee, or
otherwise assist an Optionee to obtain the cash necessary to exercise all or a
portion of an Option granted hereunder or to pay any tax liability of the
Optionee attributable to such exercise. If the exercise price is paid in whole
or part with Optionee's promissory note, such note shall (i) provide for full
recourse to the maker, (ii) be collateralized by the pledge of the Shares that
the Optionee purchases upon exercise of such Option, (iii) bear interest at the
prime rate of PolyVision's principal lender, and (iv) contain such other terms
as the Committee or the Board in its sole discretion shall reasonably require.
No Optionee shall be deemed to be a holder of any Shares subject to an Option
unless and until a stock certificate or certificates for such Shares are issued
to such person(s) under the terms of this Plan. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distributions or other rights for which the record date is prior to
the date such stock certificate is issued, except as expressly provided in
Section 10 hereof.
8. EXERCISABILITY OF OPTIONS. Any Option shall become exercisable in such
amounts, at such intervals and upon such terms as the Committee or the Board
shall provide in such Option, except as otherwise provided in this Section 8.
(a) The expiration date of an Option shall be determined by the
Committee or the Board at the time of grant, but in no event shall an Option be
exercisable after the expiration of 10 years from the date on which the Option
is granted.
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(b) Unless otherwise provided in any Option, each outstanding Option
shall become immediately fully exercisable in the event of a "Change in Control"
or in the event that the Committee or the Board exercises its discretion to
provide a cancellation notice with respect to the Option pursuant to Section
9(b) hereof. For this purpose, the term "Change in Control" shall mean:
(i) approval by the shareholders of PolyVision of a reorganization,
merger, consolidation or other form of corporate transaction or series of
transactions, in each case, with respect to which persons who were the
shareholders of PolyVision immediately prior to such reorganization, merger or
consolidation or other transaction do not, immediately thereafter, own more than
50% of the combined voting power entitled to vote generally in the election of
directors of the reorganized, merged or consolidated company's then outstanding
voting securities, in substantially the same proportions as their ownership
immediately prior to such reorganization, merger, consolidation or other
transaction, or a liquidation or dissolution of PolyVision or the sale of all or
substantially all of the assets of PolyVision (unless such reorganization,
merger, consolidation or other corporate transaction, liquidation, dissolution
or sale is subsequently abandoned); or
(ii) individuals who, as of the date on which the Option is
granted, constitute the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a
director subsequent to the date on which the Option was granted whose election,
or nomination for election by PolyVision's shareholders, was approved by a vote
of at least a majority of the directors then comprising the Incumbent Board
(other than an election or nomination of an individual whose initial assumption
of office is in connection with an actual or threatened election contest
relating to the election of the Directors of PolyVision, as such terms are used
in Rule 14a-11 of Regulation 14A of Regulation 14A promulgated under the
Securities Exchange Act) shall be, for purposes of this Agreement, considered as
though such person were a member of the Incumbent Board; or
(iii) the acquisition (other than from PolyVision) by any person,
entity or "group," within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act, of more than 50% of either the then outstanding shares
of PolyVision's common stock or the combined voting power of PolyVision's then
outstanding voting securities entitled to vote generally in the election of
directors (hereinafter referred to as the ownership of a "Controlling Interest")
excluding, for this purpose, any acquisitions by (1) PolyVision or its
Subsidiaries, (2) The Alpine Group, Inc. or any other person, entity or "group"
that as of the date on which the Option is granted owns beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act)
of a Controlling Interest or (3) any employee benefit plan of PolyVision or its
Subsidiaries.
(c) The Committee or the Board may in its sole discretion, accelerate
the date on which any Option may be exercised and may accelerate the vesting of
any Shares subject to any Option or previously acquired by the exercise of any
Option.
9. TERMINATION OF OPTION PERIOD. (a) Unless otherwise provided in any
Option agreement, the unexercised portion of any Option shall automatically and
without notice terminate and become null and void at the time of the earliest to
occur of the following:
(i) three months after the date on which the Optionee's employment is
terminated other than by reason of (A) Cause, which, solely for
purposes of this Plan, shall mean the termination of the
Optionee's employment by reason of the Optionee's willful
misconduct or gross negligence, (B) a mental or physical
disability (within the meaning of Internal Revenue Code Section
22(e)) of the Optionee as determined by a medical doctor
satisfactory to the Committee, or (C) death of the Optionee;
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(ii) immediately upon the termination of the Optionee's employment for
Cause;
(iii) twelve months after the date on which the Optionee's employment
is terminated by reason of a mental or physical disability
(within the meaning of Internal Revenue Code Section 22(e)) as
determined by a medical doctor satisfactory to the Committee or
the Board;
(iv) (A) twelve months after the date of termination of the Optionee's
employment by reason of death of the Optionee, or, if later, (B)
three months after the date on which the Optionee shall die if
such death shall occur during the one year period specified in
Subsection 9(a)(iii) hereof.
All references herein to the termination of the Optionee's employment shall, in
the case of a Optionee who is not an employee of PolyVision or a Subsidiary,
refer to the termination of the Optionee's service with PolyVision.
(b) To the extent not previously exercised, (i) each Option shall
terminate immediately in the event of (1) the liquidation or dissolution of
PolyVision, or (2) any reorganization, merger, consolidation or other form of
corporate transaction in which PolyVision does not survive, unless the successor
corporation, or a parent or subsidiary of such successor corporation, assumes
the Option or substitutes an equivalent option or right pursuant to Section
10(c) hereof, and (ii) the Committee or the Board in its sole discretion may by
written notice ("cancellation notice") cancel, effective upon the consummation
of any corporate transaction described in Subsection 8(b)(i) hereof in which
PolyVision does survive, any Option that remains unexercised on such date. The
Committee or the Board shall give written notice of any proposed transaction
referred to in this Section 9(b) a reasonable period of time prior to the
closing date for such transaction (which notice may be given either before or
after approval of such transaction), in order that Optionees may have a
reasonable period of time prior to the closing date of such transaction within
which to exercise any Options that then are exercisable (including any Options
that may become exercisable upon the closing date of such transaction). An
Optionee may condition his exercise of any Option upon the consummation of a
transaction referred to in this Section 9(b).
10. ADJUSTMENT OF SHARES.
(a) If at any time while the Plan is in effect or unexercised
Options are outstanding, there shall be any increase or decrease in the number
of issued and outstanding Shares through the declaration of a stock dividend or
through any recapitalization resulting in a stock split-up, combination or
exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the
maximum number of Shares available for grant under the Plan, or
available for grant to any person under the Plan, so that the same
percentage of PolyVision's issued and outstanding Shares shall continue
to be subject to being so optioned; and
(ii) the Board or the Committee may, in its
discretion, make any adjustments it deems appropriate in the number of
Shares and the exercise price per Share thereof then subject to any
outstanding Option, so that the same percentage of PolyVision's issued
and outstanding Shares shall remain subject to purchase at the same
aggregate exercise price.
(b) Unless otherwise provided in any Option, the Committee or
the Board may change the terms of Options outstanding under this Plan, with
respect to the option price or the number of
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Shares subject to the Options, or both, when, in the Committee's or Board's sole
discretion, such adjustments become appropriate so as to preserve but not
increase benefits under the Plan.
(c) In the event of a proposed sale of all or substantially
all of PolyVision's assets or any reorganization, merger, consolidation or other
form of corporate transaction in which PolyVision does not survive, where the
securities of the successor corporation, or its parent company, are issued to
PolyVision's shareholders, then the successor corporation or a parent of the
successor corporation may, with the consent of the Committee or the Board,
assume each outstanding Option or substitute an equivalent option or right. If
the successor corporation, or its parent, does not cause such an assumption or
substitution to occur, or the Committee or the Board does not consent to such an
assumption or substitution, then each Option shall terminate pursuant to Section
9(b) hereof upon the consummation of sale, merger, consolidation or other
corporate transaction.
(d) Except as otherwise expressly provided herein, the
issuance by PolyVision of shares of its capital stock of any class, or
securities convertible into shares of capital stock of any class, either in
connection with a direct sale or upon the exercise of rights or warrants to
subscribe therefor, or upon conversion of shares or obligations of PolyVision
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made to, the number of or exercise price
for Shares then subject to outstanding Options granted under the Plan.
(e) Without limiting the generality of the foregoing, the
existence of outstanding Options granted under the Plan shall not affect in any
manner the right or power of PolyVision to make, authorize or consummate (i) any
or all adjustments, recapitalizations, reorganizations or other changes in
PolyVision's capital structure or its business; (ii) any merger or consolidation
of PolyVision; (iii) any issue by PolyVision of debt securities, or preferred or
preference stock that would rank above the Shares subject to outstanding
Options; (iv) the dissolution or liquidation of PolyVision; (v) any sale,
transfer or assignment of all or any part of the assets or business of
PolyVision; or (vi) any other corporate act or proceeding, whether of a similar
character or otherwise.
11. TRANSFERABILITY OF OPTIONS AND SHARES.
(a) No Incentive Stock Option, and unless the prior written
consent of the Committee or the Board is obtained (which consent may be withheld
for any reason) and the transaction does not violate the requirements of Rule
16b-3 promulgated under the Securities Exchange Act no Non-Qualified Stock
Option, shall be subject to alienation, assignment, pledge, charge or other
transfer other than by the Optionee by will or the laws of descent and
distribution, and any attempt to make any such prohibited transfer shall be
void. Each Option shall be exercisable during the Optionee's lifetime only by
the Optionee, or in the case of a Non-Qualified Stock Option that has been
assigned or transferred with the prior written consent of the Committee or the
Board, only by the permitted assignee.
(b) No Shares acquired by an Officer or Director pursuant to
the exercise of an Option may be sold, assigned, pledged or otherwise
transferred prior to the expiration of the six-month period following the date
on which the Option was granted, unless the transaction does not violate the
requirements of Rule 16b-3 promulgated under the Securities Exchange Act.
12. ISSUANCE OF SHARES.
(a) Notwithstanding any other provision of this Plan,
PolyVision shall not be obligated to issue any Shares unless it is advised by
counsel of its selection that it may do so without violation of the applicable
Federal and State laws pertaining to the issuance of securities, and may require
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any stock so issued to bear a legend, may give its transfer agent instructions,
and may take such other steps, as in its judgment are reasonably required to
prevent any such violation.
(b) As a condition to any sale or issuance of Shares upon
exercise of any Option, the Committee or the Board may require such agreements
or undertakings as the Committee or the Board may deem necessary or advisable to
facilitate compliance with any applicable law or regulation including, but not
limited to, the following:
(i) a representation and warranty by the Optionee to
PolyVision, at the time any Option is exercised, that he is acquiring
the Shares to be issued to him for investment and not with a view to,
or for sale in connection with, the distribution of any such Shares;
and
(ii) a representation, warranty and/or agreement to
be bound by any legends endorsed upon the certificate(s) for such
Shares that are, in the opinion of the Committee or the Board,
necessary or appropriate to facilitate compliance with the provisions
of any securities laws deemed by the Committee or the Board to be
applicable to the issuance and transfer of such Shares.
13. ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by the Board or by a
committee appointed by the Board (the "Committee") which shall be composed of
two or more Directors all of whom shall be Outside Directors. The membership of
the Committee shall be constituted so as to comply at all times with the
applicable requirements of Rule 16b-3 promulgated under the Securities Exchange
Act and Section 162(m) of the Internal Revenue Code. The Committee shall serve
at the pleasure of the Board and shall have the powers designated herein and
such other powers as the Board may from time to time confer upon it.
(b) The Board may grant Options pursuant to this Plan to
Directors who are not employees of PolyVision or any Subsidiary and/or other
persons to whom Options may be granted under Section 5(a) hereof.
(c) The Committee or the Board, from time to time, may adopt
rules and regulations for carrying out the purposes of the Plan. The
determinations by the Committee or the Board, and the interpretation and
construction of any provision of the Plan or any Option by the Committee or the
Board, shall be final and conclusive.
(d) Any and all decisions or determinations of the Committee
shall be made either (i) by a majority vote of the members of the Committee at a
meeting or (ii) without a meeting by the unanimous written approval of the
members of the Committee.
14. WITHHOLDING OR DEDUCTION FOR TAXES. If at any time specified herein for
the making of any issuance or delivery of any Option or common stock to any
Optionee or beneficiary, any law or regulation of any governmental authority
having jurisdiction in the premises shall require PolyVision to withhold, or to
make any deduction for, any taxes or take any other action in connection with
the issuance or delivery then to be made, such issuance or delivery shall be
deferred until such withholding or deduction shall have been provided for by the
Optionee or beneficiary, or other appropriate action shall have been taken.
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15. INTERPRETATION.
(a) As it is the intent of PolyVision that the Plan comply in all
respects with Rule 16b-3 promulgated under the Securities Exchange Act ("Rule
16b-3"), any ambiguities or inconsistencies in construction of the Plan shall be
interpreted to give effect to such intention, and if any provision of the Plan
is found not to be in compliance with Rule 16b-3, such provision shall be deemed
null and void to the extent required to permit the Plan to comply with Rule
16b-3. The Committee or the Board may from time to time adopt rules and
regulations under, and amend, the Plan in furtherance of the intent of the
foregoing.
(b) The Plan and any Option agreements entered into pursuant to the
Plan shall be administered and interpreted so that all Incentive Stock Options
granted under the Plan will qualify as Incentive Stock Options under section 422
of the Internal Revenue Code. If any provision of the Plan or any such Option
agreement should be held invalid for the granting of Incentive Stock Options or
illegal for any reason, such determination shall not affect the remaining
provisions hereof, but instead the Plan and the Option agreement shall be
construed and enforced as if such provision had never been included in the Plan
or the Option agreement.
(c) This Plan shall be governed by the laws of the State of New York.
(d) Headings contained in this Plan are for convenience only and shall
in no manner be construed as part of this Plan.
(e) Any reference to the masculine, feminine, or neuter gender shall be
a reference to such other gender as is appropriate.
16. AMENDMENT AND DISCONTINUATION OF THE PLAN. The Committee or the Board
may from time to time amend, suspend or terminate the Plan or any Option;
provided, however, that, any amendment to the Plan shall be subject to the
approval of PolyVision's shareholders if such shareholder approval is required
by any federal or state law or regulation (including, without limitation, Rule
16b-3 or to comply with Section 162(m) of the Internal Revenue Code) or the
rules of any Stock exchange or automated quotation system on which the Common
Stock may then be listed or granted. Except to the extent provided in Sections 9
and 10 hereof, no amendment, suspension or termination of the Plan or any Option
issued hereunder shall substantially impair the rights or benefits of any
Optionee pursuant to any Option previously granted without the consent of the
Optionee.
17. EFFECTIVE DATE AND TERMINATION DATE. The effective date of the Plan is
January 26, 1999, the date on which the Board adopts this Plan, and the Plan
shall terminate on January 26, 2009. The Plan shall be submitted to the
shareholders of PolyVision for their approval and adoption and Options hereunder
may be granted prior to such approval and adoption but contingent upon such
approval and adoption.
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POLYVISION CORPORATION
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 18, 1999
Steven S. Elbaum, Bragi F. Schut and Joseph A. Menniti, and each of
them, as the true and lawful attorneys, agents and proxies of the
undersigned, with full power of substitution, are hereby authorized to
represent and to vote, as designated below, all shares of common stock of
PolyVision Corporation held of record by the undersigned on April 20, 1999,
at the Annual Meeting of Shareholders to be held at 10:00 a.m. on May 18,
1999, at The Mayflower Hotel - The Conservatory, 15 Central Park West, New
York, NY 10023, and at any adjournment thereof. Any and all proxies
heretofore given are hereby revoked.
1. ELECTION OF DIRECTORS. To elect all nominees.
Nominees are:Ivan Berkowitz, Michael H. Dunn, Stephen C. Knup, Bragi F. Schut
/ / AUTHORITY GIVEN / / AUTHORITY WITHHELD
For all nominees listed above except:
-----------------------------
2. To approve an amendment to PolyVision's Certificate of Incorporation
increasing the number of authorized shares of common stock from
25,000,000 shares to 40,000,000 shares.
/ /1 FOR / /2 AGAINST / /3 ABSTAIN
3. To ratify the adoption by the Board of Directors of PolyVision's 1999 Stock
Option Plan.
/ /4 FOR / /5 AGAINST / /6 ABSTAIN
4. To authorize and approve the issuance of warrants to purchase common
stock, and the possible issuance of common stock underlying such
warrants, which would represent 20% or more of the outstanding shares
of common stock.
/ /7 FOR / /8 AGAINST / /9 ABSTAIN
5. To ratify the selection of Arthur Andersen LLP as PolyVision's independent
auditor.
/ /10 FOR / /11 AGAINST / /12 ABSTAIN
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 THROUGH 5.
PLEASE MARK, DATE AND SIGN THE REVERSE SIDE AND MAIL PROMPTLY IN THE ENCLOSED
ENVELOPE.
Discretionary authority is hereby granted with respect to such other
matters as may properly come before the meeting.
The signer acknowledges receipt of the Notice of Annual Meeting of
Shareholders and the Proxy Statement furnished therewith. Unless otherwise
specified, this Proxy will be voted FOR Proposals 1 through 5.
IMPORTANT: Please sign exactly as name appears
hereon. Each joint owner shall sign. Executors,
administrators, trustees, etc. should give their full
title.
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Signature(s)
--------------------------------------------------
Date
--------------------------------------------------
Signature(s)
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Date
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