REXHALL INDUSTRIES, INC.
25655 Springbrook Avenue
Saugus, California 91350
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Rexhall Industries, Inc. ("Company")
will be held at the Hampton Inn, 25259 The Old Road, Newhall, California,
91321, on Wednesday, May 27, 1992, at 2:00 p.m., California time for the
following purposes:
1. To elect its Board of Directors to serve for the ensuing year;
2. To ratify the selection of Deloitte & Touche as the independent public
accountants of the Company for the year ending December 31, 1992;
3. To transact such other business as may properly come before the meeting
or any adjournments thereof.
The stock transfer books of the Company will not be closed, but only holders
of common stock of record at the close of business on April 17, 1992 will be
entitled to vote at the meeting.
Your proxy is enclosed. You are cordially invited to attend the meeting,
but if you do not expect to attend, or if you plan to attend, but desire the
proxy holders to vote your shares, please date and sign your proxy and
return it in the enclosed postage paid envelope. The giving of this proxy
will not affect your right to vote in person in the event you find it
convenient to attend.
Cheryl L. Rex
Secretary
DATED: April 17,1992
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REXHALL INDUSTRIES, INC.
25655 Springbrook Avenue
Saugus, California 91350
PROXY STATEMENT FOR ANNUAL MEETING TO BE HELD
MAY 27,1992, 2:00 P.M.
Your proxy is solicited on behalf of the Board of Directors of Rexhall
Industries, Inc. ("Company") for use at the annual meeting of shareholders to
be held at the above date at the Hampton Inn, 25259 The Old Road, Newhall,
California, 91321. If a proxy in the accompanying form is duly executed and
returned, the shares represented by the proxy will be voted as directed.
If no direction is given, the shares will be voted for the election of the
five (5) nominees for director named herein and for the approval of Deloitte
& Touche as the Company's independent accountants for the year ending
December 31, 1992. A proxy given by a shareholder may be revoked at any time
before it is exercised by notifying the Secretary of the Company in writing
of such revocation, by giving another proxy bearing a later date or by
voting in person at the meeting.
The cost of this solicitation of proxies will be borne by the Company.
Solicitations will be made by mail. In addition the officers and regularly
engaged employees of the Company may, in a limited number of instances,
solicit proxies personally or by telephone. The Company will reimburse
banks, brokerage firms, other custodians, nominees and fiduciaries for
reasonable expenses incurred in sending proxy materials to beneficial owners
of common stock of the Company.
The Company's annual report, including financial statements for its fiscal
year ended December 31, 1991, is being mailed to all shareholders
concurrently herewith. The annual report is not part of the proxy materials.
The Company's annual report on Form 10-K for the year ended December 31,
1991, as filed with the Securities and Exchange Commission, is available
without charge upon written request from the Secretary of the Company at the
address set forth above.
Holders of common stock of record at the close of business on April 17, 1992
will be entitled to vote at the meeting. There were 2,405,000 shares of
common stock outstanding at that date. Each share is entitled to one vote and
a majority of the shares of common stock outstanding is necessary to
constitute a quorum for the meeting. The shareholders have cumulative voting
rights in the election of directors. Under the cumulative voting method, a
shareholder may multiply the number of shares owned by the number of
directors to be elected and cast this total number of votes for any one
candidate or distribute the total number of votes in any proportion among as
many candidates as the shareholder desires. A shareholder may not cumulate
his votes for a candidate unless such candidate's name has been placed in
nomination prior to the voting and unless a shareholder has given notice at
the meeting prior to the voting of his intention to cumulate his votes. If
any shareholder gives such notice, all shareholders may then cumulate
their votes.
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ELECTION OF DIRECTORS
The Company's directors are elected annually to serve until the next annual
meeting of shareholders and until their successors are elected and qualified.
The number of directors presently authorized by the By-laws of the Company
is five (5).
Unless otherwise directed by shareholders, the proxy holders will vote all
shares represented by proxies held by them for the election of the maximum
number of the following nominees, all of whom are now members of and
constitutes the Company's Board of Directors. The Company is advised that
all of the nominees have indicated their availability and willingness to
serve if elected. In the event that any nominee becomes unavailable or
unable to serve as a director of the Company prior to voting, the proxy
holders will vote for a substitute nominee in the exercise of their best
judgment.
Information Concerning Nominees
Information concerning the nominees based on data furnished by them is
set forth below:
WILLIAM J. REX, age 41, a founder of the Company, has served as the Company's
chief executive from its inception as a general partnership in July 1986. In
January 1987, when the Company began operations in corporate form, Mr. Rex
became the Company's President and Chairman of the Board, offices which he
continues to hold. From March 1983 until founding the Company, Mr. Rex
served in various executive capacities for Establishment Industries, Inc., a
manufacturer of Class A and Class C motorhomes which was acquired in June
1985 by Thor Industries, Inc., a large manufacturer of recreational vehicles.
His last position with Establishment Industries, Inc. was President. From
1970 until March 1983, Mr. Rex was employed in various production capacities
by Dolphin Trailer Company, a manufacturer of a wide range of recreational
vehicle products. At the time he left Dolphin Trailer Company (which changed
its name to National R.V., Inc. in 1985), Mr. Rex was Plant Manager in charge
of all production and research and development.
W. MICHAEL HILL, age 46, joined the Company as Executive Vice President in
November, 1990 and became a member of the Board of Directors in March 1991.
From October 1982 until joining the Company, Mr. Hill served as President of
Executive Industries, Inc. where he served as Chief Operating Officer and
later as Chief Executive Officer. Executive Industries was a manufacturer of
Recreational Vehicles.
DOUGLAS J. BURTON, age 36, joined the Company in August 1991 as Controller.
From November 1989 to April 1991, W. Burton served as the Chief Financial
Officer of Avanti Food Distributors, Inc. From May 1986 to November 1989,
Mr. Burton was employed by Executive Industries, Inc. as Chief Financial
Officer. Executive Industries, Inc. was a Class "A" motorhome manufacturer.
AL J. THEIS, age 74, became a director in August 1987. Mr. Theis is a
consultant to the recreational vehicle industry and consults with the Company
relating to financial matters and in development of global sales. From
August 1987 to February 1991, Mr. Theis was employed by the Company as Chief
Financial Officer. From February 1982 until June 1984, he was employed by
Establishment Industries, Inc., as Chief Financial Officer and Corporate
Planner.
<PAGE>
THOMAS H. LENAGH, age 72, became a director of the Company in June 1989.
Since 1984, Mr. Lenagh has been a financial advisor. From 1982 to 1984,
Mr. Lenagh served as Chairman of the Board and Chief Executive Officer of
Greiner Engineering Corp., an engineering consulting company located in
Irvine, Texas. Mr. Lenagh serves on the boards of directors of Adams Express
Company, CML, Inc., Clemente Global, Fund, Gintel Funds, Irvine Sensors
Corporation, MLAM Funds, SCI Systems, Inc., U.S. Life Corporation, and ICN
Biomedicals.
Until June 30, 1992, the Company has agreed to nominate and use its best
efforts to cause the election to the Company's Board of Directors of a
designee of H.J. Meyers & Co , Inc., the Representative of the Underwriters
in the Company's initial public offering, reasonably acceptable to the
Company. H.J. Meyers & Co., has currently designated Thomas H. Lenagh as
such nominee.
Information Concerning Directors and Committees
During 1991, there were four meetings of the Board of Directors. Outside
directors receive $750 per meeting for serving the Company as members of the
Board. Directors may also be reimbursed for reasonable expenses relating to
attendance at meetings of the Board or a Committee of the Board. Each
Director attended all of the Board meetings held during his tenure as a
director in 1991.
There are the following Committees of the Board of Directors:
Audit Committee. The Audit Committee consists of William J. Rex, Al J. Theis
and Thomas H. Lenagh. The audit Committee is to meet with representatives of
the Company's independent auditors and with representatives of senior
management. The committee recommends the engagement or discharge of the
Company's independent auditors, consults with the auditors as to the adequacy
of internal accounting procedures and reviews and approves financial
statements and reports. The Audit Committee met one time in 1991.
Compensation Committee. The Compensation Committee consists of William J.
Rex, Al J. Theis and Thomas H. Lenagh. The Compensation Committee is
responsible for reviewing and reporting to the Board on the recommended
annual compensation for officers including salary, bonuses, and other forms
of compensation and remuneration and also administers the Company's Stock
Option Plan. The Compensation Committee met three times in 1991.
The Company has no standing nominating or similar committee whose function is
to consider or recommend nominees to the Board of Directors.
<PAGE>
Securities Ownership
The following table sets forth information as of April 17, 1992 concerning
the ownership of the Company's Common Stock (the only class of securities
outstanding) by all persons known by the Company to be beneficial owners of
more than five percent (5%), by all directors and nominees for director
owning Common Stock, and by all directors and officers as a group:
Number of Percent of
Shares Outstanding
Name of Beneficial Owner Beneficially Shares at
or Identity of Group Owned (1)
William J. Rex (1) 1,231,000 51.2%
c/o Rexhall Industries, Inc.
25655 Springbrook Avenue
Saugus, CA 91350
Thomas H. Lenagh 1,000
All Directors and Officers as a Group
(8 persons) 1,232,000 51.2%
* Less than 1%.
(1) The persons named in the table have sole voting and investment power with
respect to all shares of Common Stock shown as beneficially owned by him,
subject to applicable community property law.
Executive Compensation
Cash Compensation
The following table sets forth certain information as to each of the five
highest paid of the Company's executive officers whose cash compensation
exceeded $60,000 and for all executive officers as a group for the year ended
December 31, 1991:
Cash
Name of Individual Capacity in Compensation
or Number In Group Which Served (1) (2)
William J. Rex President $320,445
W. Michael Hill Executive Vice President $113,220
W. Bryan George Chief Financial Officer $86,346
Donald C. Hannay, Sr. Vice President Sales $108,700*
Donald C. Hannay, Jr. Vice President Marketing $ 91,344
All executive officers as a group
(Nine persons) $771,832
*Resigned March 31, 1992
<PAGE>
(1) The Company has no profit sharing, pension, retirement, annuity, savings
or similar benefit plan at the present time.
(2) Excludes compensation attributable to the personal use of a company-owned
automobile provided to Mr Rex.
(3) As of February 28, 1991, Mr. Theis terminated employment with the Company
and resigned as Chief Financial Officer. He continues to consult with
the Company and serve on the Board of Directors.
(4) As of August 31,1991, Bryan George terminated his employment with the
Company.
In June 1989, the Company entered into a three year employment agreement with
William J. Rex, its President. The employment agreement provides for an
annual salary of $250,000 plus a bonus, determined monthly, in the amount of
10% of income before bonus and taxes.
The Company also has an incentive program under which it pays all supervisory
employees involved in sales and production, including supervisors, foremen
and leadmen, a cash bonus based on the number of motorhomes shipped.
Stock Option Plan
In May 1989, the Company adopted the 1989 Incentive and Nonstatutory Stock
Option Plan (the "Option Plan"), which provides for the granting of (i)
incentive stock options pursuant to Section 422A of the Internal Revenue Code
of 1986, as amended, to key employees, and (ii) nonstatutory stock options to
key employees and directors and consultants to the Company designated by the
Board as eligible under the Option Plan. Under the Option Plan, options for
up to 225,000 shares may be granted.
The Option Plan is administered by the Compensation Committee of the Board of
Directors, which determines the terms of options granted, including the
exercise price, the number of shares subject to options, and the terms and
conditions of exercise. No option granted under the Option Plan is
transferable by the optionee other than by will or the laws of descent and
distribution, and each option is exercisable during the lifetime of the
optionee only by such optionee.
The exercise price of all stock options granted under the Option Plan must be
at least equal to the fair market value of such shares on the date of grant,
and the maximum term of each option may not exceed 10 years. With respect to
any participant who owns stock possessing more than 10% of the voting rights
of the Company's outstanding capital stock, the exercise price of any stock
option must be not less than 110% of the fair market value on the date of
grant and the maximum term of such option may not exceed five years. Stock
appreciation rights are not authorized under the Option Plan.
<PAGE>
The following table sets forth information as to all options to purchase
Common Stock which were granted to Executive Officers specified in the table
under "Cash Compensation" above who received options and by all Executive
Officers as a Group during the year ended December 31, 1991:
All Executive
Officers
William J. Al J. Donald C. Donald C. as a Group
Rex Theis Hannay, Sr. Hannay, Jr. (4 persons)
Granted-
Number of Options (1) 65,000 5,000 10,000 10,000 90,000
Weighted average
per share exercise price $5.36 $4.875 $4.875 $4.875 $5.36
Outstanding at
December 31, 1991 65,000 5,000 10,000 10,000 90,000
(1) In 1990, certain options previously granted under the Company's Stock
Option Plan were canceled and re-granted at exercise prices which took
into account the declining market price of the Company's Common Stock.
The vesting schedules of the re-granted options were also revised.
No director who was not an Executive Officer was granted any stock options
during the year ended December 31, 1991. No stock option was exercised during
the year ended December 31, 1991.
William J. Rex, Al J. Theis, Donald C. Hannay, Sr., and Donald C. Hannay, Jr.
were unaware of the reversal of prior S.E.C. regulations where stock options
are now required to be reported to the S.E.C. on form 4 within 10 days after
options were granted. They were, however, reported on our proxy statement
dated March 22, 1991. On March 30, 1992 form 5 was filled out reporting those
options and mailed to the S.E.C.
Certain Transactions
William J. Rex and Charles A. Hall founded the Company as a general
partnership. Effective December 31, 1986, the partnership transferred its
assets and business, valued at $105,000, to Rexhall Industries, Inc., a
California corporation, in exchange for the Company's assumption of the
partnership's liabilities and an aggregate of 1,882,500 shares of the
Company's Common Stock (equal to $.06 per share). Of such shares, 1,255,000
were issued to Mr. Rex and 627,500 were issued to Mr. Hall.
In February 1989, Mr. Hall's association and affiliation with the Company
terminated. As part of the termination process, the Company repurchased all
of the 627,500 shares of Common Stock owned by Mr. Hall for an aggregate of
$763,133 (equal to $1.22 per share). The sum of $410,000 of the purchase
price was paid by the Company to Mr. Hall in cash and property and the
balance was paid in monthly installments of $15,000, including interest at
the rate of 9% per annum, in accordance with the provisions of a promissory
note. Mr. Rex had personally guaranteed the Company's obligation on the
promissory note to Mr. Hall.
Mr. and Mrs. Rex have also personally guaranteed various other of the
Company's obligations. Mr. and Mrs. Rex, with the Company's cooperation, are
attempting to remove themselves from these guarantees and intend to avoid
personally guaranteeing any of the Company's obligations in the future.
<PAGE>
In the past, the Company has purchased instrument panels installed in the
dashes of its motorhomes from Ripco (formerly James Rex Enterprises), a firm
owned by James C. Rex, the brother of William J. Rex. During 1991, the
Company paid an aggregate of approximately $124,045, to the firm of Mr. Rex's
brother for such instrument panels. The Company believes that these
transactions were on terms no less favorable to the Company than could have
been obtained from an unrelated third party.
SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche as independent
accountants of the Company for the year ending December 31, 1992 and further
directed that the Company submit the selection of independent accountants for
ratification by shareholders at the Company's annual meeting. Deloitte &
Touche acted for the Company in such capacity for the year ended December 31,
1991. Representatives of Deloitte & Touche are expected to be present at the
annual meeting and will have the opportunity to make a statement if they
desire to do so. They will also be available to respond to appropriate
questions.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1993 Annual Meeting
must be received at the Company's principal office no later than December 28,
1992 in order to be considered for inclusion in the proxy statement and form
of proxy related to that meeting.
OTHER BUSINESS
The Board of Directors knows of no other matter to be acted upon at the
meeting. However, if any other matter shall properly come before the
meeting, the proxy holders named in the proxy accompanying this statement
will have discretionary authority to vote all proxies in accordance with
their best judgment.
By order of the Board of Directors
Cheryl L. Rex
Secretary
DATED: April 17,1992
Saugus, California
