REXHALL INDUSTRIES, INC.
46147 7th Street West
Lancaster, California 93534
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Rexhall Industries, Inc.
("Company") will beheld at the Lancaster plant, 46147 7th Street West,
Lancaster, California, 93534 on Tuesday, May 25, 1999, 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 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 records at the close of business
on April 19, 1999 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.
By order of the Board of Directors
REXHALL INDUSTRIES, INC.
Cheryl L. Rex
Secretary
DATED: April 19, 1999
Lancaster, California<PAGE>
<PAGE>
REXHALL INDUSTRIES, INC.
46147 7th Street West
Lancaster, California 93534
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDER
TO BE HELD MAY 25, 1999, 2:00 P.M.
SOLICITATION OF PROXIES
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 on the above date at 46147 7th Street West,
Lancaster, California, 93534. 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. 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, 1998, 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, 1998, 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 in the notice.
Holders of common stock of record at the close of business on
April 19, 1999 will be entitled to vote at the meeting. There were
3,010,362 shares of common stock outstanding on 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
<PAGE>
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 shareholders give such notice, all shareholders may then
cumulate their votes.
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 no less than four (4) but no more than
seven (7).
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 nominees become 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 48, as founder of the Company, has
served as the Company's Chief Executive Officer from its inception as
a general partnership to date. Upon commencing 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
vehicles 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.
DONALD C. HANNAY, SR., AGE 71, joined the Company in
December 1987 and is responsible for product sales. He became a
director in May 1989. From April 1982 until August 1987, he was
employed by Establishment Industries, Inc. as Vice President, Sales
and Marketing, where he built Establishment's dealer network and was
responsible for dealer sales. From August 1987 until joining the
Company, he was employed as General Sales Manager by Komfort Industries
of California, Inc., a recreational vehicle manufacturer located in
Riverside, California.
<PAGE>
AL J. THEIS, AGE 81, joined the Company as its Chief
Financial Officer and a member of the Board of Directors in August
1987. In February 1991, he resigned as Chief Financial Officer and
began serving the Company as a consultant, in financial matters and in
development of global sales. He continues to serve as a member of the
Board of Directors. From July 1984 until joining the Company, Mr.
Theis was self-employed as a management consultant to recreational
vehicles industry manufacturers. From February 1982 until June 1984,
he was employed by Establishment Industries, Inc. as Chief Financial
Officer and Corporate Planner.
ROBERT A. LOPEZ, AGE 59, is President of Nickerson Lumber and
Plywood. Mr. Lopez started his employment with Nickerson as an outside
salesman in 1969 and in 1980 he became a partner and purchased
Nickerson Lumber stock. He was elected as President of Nickerson in
1981. His background in marketing products is primarily to residential
builders, manufactured housing and recreational vehicle assemblers.
Mr. Lopez will be a great asset to further developments of marketing
Rexhall products in both the domestic and global markets. In his spare
time, if any, Mr. Lopez is captain of the San Fernando Rangers, a
non-profit organization working to use horses as therapeutic
conditioning for mentally and physically disabled children.
FRANK A. VISCO, AGE 54, was elected to the Board of
Directors on December 17, 1998. Mr. Visco is owner of Frank A. Visco
& Associates insurance company. Mr. Visco began his insurance career
in 1970 with New York Life Insurance Company as a Sales Manager in
their Antelope Valley office. From 1975-1984 he was the co-owner of
APS Co. Inc., producing aircraft parts for the aircraft industry. In
1980, in addition to his insurance activities, he began developing
properties in Los Angeles and Kern County.
Mr. Visco is involved in many community services. He assists
the YMCA in various capacities as well as his participation in their
annual fund raisers. Mr. Visco has served as Vice Chairman of the
United Way from 1972-1974. Mr. Visco was co-founder and Charter
President of the North Los Angeles County Regional Center for the
Developmentally Disabled. Mr. Visco financially supports many
organizations from the Boy Scouts of America to the Child Abuse Center,
American Cancer Society and other organizations that support the
mentally retarded citizens of the Antelope Valley. He assisted, along
with Kaufman & Broad, in building the Antelope Valley Assistance League
Day Care Center.
Mr. Visco began his political career in 1974 when he was
appointed to the Republican State Central Committee and subsequently
assisted many State candidates as well as Presidential campaigns. He
was a delegate to the Republican National Convention of 1976, 1980 and
1984 supporting Ronald Regan for President and had the high honor of
being selected as a member of the Electoral College to accomplish the
constitutional duty of electing the President of the United States.
Mr. Visco was a delegate to the National Conventions in 1992 and 1996.
Mr. Visco currently serves on the Republican Party Executive Committee and
as an ex-officio member of the Republican Central Committee.
<PAGE>
Information Concerning Directors and Committees.
During 1998, there were four meetings of the Board of
Directors. Outside directors receive $500 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 and committee meetings held during his tenure as a director
in 1998.
These are the following Committees of the Board of Directors:
Audit Committee. The Audit Committee consist of William J.
Rex, Al J. Theis andRobert A. Lopez. 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 1998.
Compensation Committee. The Compensation Committee consists
of William J. Rex, Al J. Theis and Robert A. Lopez. 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 renumeration and also
administers the Company's StockOption Plan. The Compensation Committee
met four times in 1998.
The Company has no standing nominating or similar committee
whose function is to consider or recommend nominees to the Board of
Directors.
Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth information regarding the
ownership of the Company's Common Stock by (I) each person known by the
Company to be the beneficial owner of more than 5% of the outstanding
shares of Common Stock, (ii) each of the Company's directors
beneficially owning Common Stock and (iii) all of the Company's
officers and directors as a group as:
Number of Percent of
Name of Beneficial Owner Shares Outstanding
or Indentity of Group Beneficially Shares at
Owned (1) March 31, 1999
William J. Rex (1)..... 1,546,000 51.4%
c/o Rexhall Industries
46147 7th Street West
Lancaster, California 93534
All Directors and Officers
as a Group 6 persons) 1,570,000 52.2%
<PAGE>
(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
The following table sets forth certain information as to each of the
four highest paid (1) of the Company's executive officers whose cash
compensation exceeds $100,000 for the year ended December 31, 1998.
SUMMARY COMPENSATION TABLE
Annual Compensation
Name and Other Annual
Principal Position Year Salary ($) Bonus($) Compensation (2)
William J. Rex 98 250,000 604,917 ----------
President & CEO 97 250,000 168,243 ----------
96 250,000 199,8900 ----------
Donald C. Hannay, Sr. 98 52,000 177,600 ----------
V.P. of Sales 97 52,800 170,391 ----------
& Marketing 96 52,800 171,550 ----------
Demetrio Arias 98 47,000 93,000 ----------
V.P. of Production
Anthony J. Partipilo 98 77,100 46,325 -----------
(1) Note: Only four executive officers received cash compensation in
excess of $100,000.
(2) The unreimbursed incremental cost to the Company of providing
perquisites and other personal benefits during 1998 did not exceed,
as to any named officer, the lesser of $50,000 or 10% of the total
998 salary and bonus paid to such named officer and, accordingly,
is omitted from the table. These benefits included (I) reimbursement
for medical expenses and (ii) amounts allocated for personal use of a
company-owned automobile provided to Mr. Rex.
<PAGE>
Compensation Committee Report
On August 1, 1996, the Company renewed for 5 years (expires
July 31, 2001) an employment agreement with William Rex. The
employment agreement provides for an annual salary of $250,000 plus a
bonus determined monthly in the amount of 10% before bonus and taxes.
Other Executive Officers are compensated based on the following factors
as determined by the Board of Directors: (1) the financial result of
the Company during the prior year, (2) compensation paid to executive
officers in prior years, (3) extraordinary performance during the year
and (4) compensation of executive officers employed by competitors.
Directors who are not Executive Officers are paid $500 per
Board Meeting and there are four Board Meetings per year.
The Company also has an incentive program under which it pays
supervisory employees involved in sales and production a cash bonus
based on specific performance criteria. Committee members: William J.
Rex, Robert A. Lopez and Al J. Theis. Mr. Rex does not participate in
the determination of his own compensation.
The Committee believes that the executive compensation
programs and practices described above are conservative and fair to
shareholders. The Committee further believes that these programs and
practices serve the best interests of Rexhall and its shareholders.
Respectfully submitted,
Robert A. Lopez
Al J. Theis
William J. Rex
<PAGE>
<PAGE>
COMPARATIVE SHARE PERFORMANCE
The graph below compares the cumulative total shareholder
return on the Common Shares of Rexhall for the last five fiscal years
with the cumulative total return on the Standard & Poor's (S&P) 500
Index over the same period (assuming the investment of $100 in
Rexhall's Common Shares, the S & P 500 Index and the below mentioned
Peer Group Index on December 31, 1993).
REXHALL INDUSTRIES, INC.
Share Price Performance
INDEXED TOTAL RETURN - BASE 100
SOURCES: IDD Information Services via Lexis BASE YEAR = 100: 12/31/93
Company Name 12/93 12/94 12/95 12/96 12/97 12/98
REXHALL INDUSTRIES, INC 100.00 101.93 79.70 113.04 79.70 133.33
S&P 500 COMP-LTD 100.00 98.46 132.05 158.80 208.05 263.54
PEER GROUP INDEX
Coachmen Industries, Inc.100.00 94.58 133.85 174.65 132.68 161.54
Monaco Coach Corp. 100.00 112.96 66.66 120.37 188.88 196.30
Thor Industries, Inc. 100.00 75.73 75.26 98.06 133.24 98.06
*TOTAL RETURN INDEX GRAPH AVAILABLE ON HARD COPY.
<PAGE>
STOCK OPTION PLAN
In May 1989, the Company adopted the 1989 Incentive and
Nonstatutory Stock Option pursuant to Section 422A of the Internal
Revenue Code of 1986, as amended to (i) key employees, and (ii) to
directors and consultants to the Company designed by the Board as
eligible under the Option Plan. Under the Option Plan, options for
up to 225,000 shares maybe granted.
The following table sets forth information as to all options
to purchase Common Stock which were granted to Executive Officers
specified in the table under "Cash Compensation" above who received
options during the year ended December 31, 1998:
Option/SAR Grants
Percent of Total
Number of Securities Options/SARs
Underlying Grant to Exercise
Options/SARS Employees in or Base Expiration
Name Year Granted Fiscal Year Price ($/Sh) Date
William J.
Rex 1998 -0- -0- -0-
1997 -0- -0- -0-
1996 -0- -0- -0-
Donald C.
Hannay 1998 -0- -0- -0-
1997 -0- -0- -0-
1996 -0- -0- -0-
Option/SAR grants Canceled
Number of
Securities
Underlying % of Total Option
Options/SARs Grants canceled Base Price
Name Year Grants Canceled to employees (SH)
William J. Rex 1998 -0- -0- -0-
1997 -0- -0- -0-
1996 -0- -0- -0-
Donald C. Hannay 1998 -0- -0- -0-
1997 -0- -0- -0-
1996 -0- -0- -0-
No director who was not an Executive Officer was granted any stock
options during the year ended December 31, 1998. There were no stock
options granted in 1998.
<PAGE>
Aggregated Option/SAR Exercises in last FY
and FY-End Options/SAR Values
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
at FY-End FY-End
Shares Acquired Exercisable/ Exercisable/
Name on Exercise Value Unexercisable Unexercisable
Realized($)
(1)
William J. Rex 112,000 349,000 -0-/-0- - 0-/-0-
Donald C. Hannay 11,000 35,750 11,000/-0- $63,250/-0-
(1) 12/31/98 close price $9.00 vs. option price.
No options have been granted under the Option Plan in 1998. The
following table sets forth information from inception of Option Plan
through December 31, 1998 concerning the net number of options under
the Option Plan that has been received by (i) each of the Company's
current executive officers, (ii) each nominee for election as director,
(iii) all current executive officers as a group, (iv) all current
directors who are not executive officers as a group, and (v) all
employees who are not executive officers:
Number of Options
Name of Person/Group Position with the Company Granted
William J. Rex Chairman of the Board, President
and Chief Executive
Officer; and Nominated Director 112,000
Donald C. Hannay, Sr. Vice President of Sales and Marketing;
and Nominated Director 22,000
All current executive officers as a group.....................134,000
<PAGE>
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934
requires Rexhall's directors, executive officers, and persons who own
more than ten percent (10%) of a registered class of Rexhall's equity
securities to file with the United States Securities and Exchange
Commission ("SEC") initial reports of ownership and reports of changes
in ownership of Common Shares and other equity securities of Rexhall.
Officers, directors and greater than ten percent (10%) shareholders,
are required by SEC regulations to furnish the Company with copies of
all Section 16(a) forms filed by them.
To the Company's knowledge, based solely on review of
the copies of such reports furnished to the Company and written
representations that no other reports were required, all Section 16(a)
filing requirements applicable to its officer, directors and greater
than ten percent (10%) beneficial owners were complied with on a timely
basis during the fiscal year ended December 31, 1998.
SELECTION OF INDEPENDENT ACCOUNTANTS
The firm of KPMG Peat Marwick LLP will continue to serve
Rexhall as independent auditors for the fiscal year ending December
1, 1999. The firm of KPMG Peat Marwick LLP has served as independent
auditors for Rexhall since 1998. Representatives of KPMG Peat Marwick
LLP are expected to be present at the Annual Meeting and will have the
opportunity to make statements and respond to appropriate questions.
ANNUAL REPORT
Rexhall's Annual Report, containing audited financial
statements for the fiscal year ended December 31, 1998, December 31,
1997 and December 31, 1996, accompanies or has proceeded the mailing
of this Proxy Statement. Upon your written request, Rexhall will send
you, without charge, a copy of the Annual Report on Form 10-K for the
fiscal year ended December 31, 1998, including the financial statements
and schedules thereto, which Rexhall is filing with the Securities and
Exchange Commission. Rexhall's Annual Report on Form 10-K is
incorporated herein by reference and can be found in the EDGAR website
at www.SEC.gov, accession number 0000850476-99-000002. The written
request must be directed to the attention of Thomas M. Zirnite, Chief
Financial Officer of Rexhall, 46147 7th Street West, Lancaster, CA
93534.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 2000
Annual Meeting must be received at the Company's principal office no
later than December 28, 1999 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
REXHALL INDUSTRIES, INC.
Cheryl L. Rex
Secretary
DATED: April 19, 1999
Lancaster, California
<PAGE>
PROXY CARD REXHALL INDUSTRIES, INC.
ANNUAL MEETING OF SHAREHOLDERS
May 25, 1999
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY
The undersigned hereby designates WILLIAM J. REX, and CHERYL L. REX,
or either of them, to act as proxy for the purpose of voting the
common shares of Rexhall Industries, Inc. held of record by the
undersigned on April 19, 1999, at the Annual Shareholders meeting of
the Corporation to be held at Corporate Offices, 46147 7th Street West,
Lancaster, California, 93534, on May 25, 1999 at 2:00 p.m., California
time, and any adjournment thereof, as directed herein, or in the
absence of direction and as to any other matters which may come before
the meeting, in the discretion of said proxies as follows:
1. FOR AGAINST ABSTAIN
The election as directors of the Company of the five (5) persons
listed below.
(The Board of Directors recommends a vote FOR each director listed
in Item 1)
William J. Rex, Al J. Theis, Donald Hannay, Sr., Robert A. Lopez
and Frank A. Visco
Proxies signed and returned without checking any boxes will be
effective as votes FOR approval.
BACK SIDE OF PROXY CARD
Please sign exactly as your name appears on your certificates, with
all persons signing on jointly held certificates. A proxy executed by
a corporation should be signed in its name by an authorized officer.
Dated: , 1999
Signature of shareholder
Signature of shareholder
Please sign exactly as the name or names
appear at left.
