REXHALL INDUSTRIES, INC.
46147 North 7th Street West
Lancaster, California 93534
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Rexhall Industries, Inc.
("Company") will be held at the Lancaster plant, 46147 North 7th Street West,
Lancaster, California, 93534 on Tuesday, May 23, 2000, 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 17, 2000
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
Corporate Secretary
DATED: April 17, 2000
Lancaster, California
<PAGE>
REXHALL INDUSTRIES, INC.
46147 North 7th Street West
Lancaster, California 93534
ANNUAL MEETING OF SHAREHOLDER
TO BE HELD MAY 23, 2000, 2:00 P.M.
PROXY STATEMENT
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, 1999, 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,
1999, 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 17,
2000 will be entitled to vote at the meeting. There were 3,160,850 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 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.
<PAGE>
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, 49
Mr. Rex is a 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., 72
Mr. Hannay 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.
Robert A. Lopez, 60
Mr. Lopez 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.
<PAGE>
Frank A. Visco, 55
Mr. Visco was elected to the Board of Directors on December 17, 1998.
Mr. Frank A. 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.
Dr. Dennis K. Ostrom, 58
Dr. Ostrom was elected to the Board of Directors on July 12, 1999. Dr.
Ostrom received his BS, MS and Ph.D. degrees in Engineering from the
University of California, Los Angeles. He majored instructural mechanics and
dynamics. Dr. Ostrom is a Professional Civil Engineer in the State of
California.
Dr. Ostrom was employed by Southern California Edison Company from
1970 - 1996. His position was that of a Consultant. His job was
formulating technical strategy and policy and relating the same to the
California Energy Commission, California Public Utilities Commission, Nuclear
Regulatory Commission and local regulatory agencies.
Dr. Ostrom has written several papers about risk management and how this
relates to equipment purchasing and risk mitigation strategies, including
insurance purchase decisions. While at Edison, he applied this expertise as
a private consultant (with knowledge and consent of Edison) for other
utilities and organizations, i.e., United States National Academics of
Science and Engineering; Office of Technology Assessment, Congress of the
United States; Coca Cola; Bonneville Power Authority; British Columbia
Hydro; New Zealand Centre for Advanced Engineering; East Bay Municipal
Utility District; Puget Sound and Power; Snohomish County Public Utility
District; Central United States Earthquake Consortium; Tennessee Valley
Authority; Eugene Water & Electric Board and Humbolt Bay Municipal Water
District.
From 1988 to present, Dr. Ostrom has been a member of the Board of
Directors for Keysor Century, Inc., Saugus, California.
Currently Dr. Ostrom is an ongoing consultant for San Diego Gas &
Electric, Pacific Gas & Electric and Southern California Edison. In addition
to his consulting work, Dr. Ostrom is the Planning Commissioner for the City
of Santa Clarita.
<PAGE>
Information Concerning Directors and Committees. During 1999, there were
three 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.
These are the following Committees of the Board of Directors:
Audit Committee. The Audit Committee consist of William J. Rex, Robert A.
Lopez and Dr. Dennis K. Ostrom. Dr. Dennis K. Ostrom was appointed to the
Audit Committee on January 1, 2000 to replace Mr. Al J. Theis. 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 three times in 1999.
Compensation Committee. The Compensation Committee consists of William J.
Rex, Robert A. Lopez and Frank A. Visco. Mr. Frank A. Visco was appointed
to the Compensation Committee on November 22, 1999 to replace Mr. Al J.
Theis. 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 re-numeration
and also administers the Company's Stock Option Plan. The Compensation
Committee met three times in 1999.
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, 2000
William J. Rex (1)..... 1,623,000 51.3%
c/o Rexhall Industries
46147 7th Street West
Lancaster, California 93534
All Directors and
Officers as a Group (6 persons) 1,649,000 52.2%
(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.
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information as to each of the two
highest paid (1) of the Company's executive officers whose cash compensation
exceeds $100,000 for the year ended December 31, 1999.
SUMMARY COMPENSATION TABLE
Annual Compensation
Name and Bonus
Principal Accrued Other Annual
Position Year Salary ($) Bonus($) Non-Paid Compensation (2)
William J. Rex 99 250,000 445,000 411,000 ---
President & CEO 98 250,000 295,000 310,000 ---
97 250,000 168,000 --- ---
Donald C. Hannay,
Sr. 99 61,400 201,600 20,700 ---
V.P. of Sales
& Marketing 98 52,000 178,000 --- ---
97 52,800 170,000 --- ---
(1) Note: Only two 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 1997 did not exceed, as to any
named officer, the lesser of $50,000 or 10% of the total 1999 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.
AUDIT COMMITTEE REPORT
On November 22, 1999 the Audit Committee met with the management of the
company to review and discuss the audited financial statements. On November
22, 1999, the Audit Committee met with the Company's outside auditors to
discuss the conduct of the audit and has clarified their independence. It is
the opinion of the Audit Committee that the audited financials contained
within the 10-K and proxy materials are a true and accurate reflection of the
Company's financial status.
Respectfully Submitted:
William J. Rex
Robert A. Lopez
Dr. Dennis K. Ostrom
<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 or
sales commission, (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 were three Board Meetings in 1999.
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.
The Committee members are William J. Rex, Robert A. Lopez and Frank A.
Visco. Mr. Frank A. Visco was appointed to the Compensation Committee on
November 22, 1999 to replace Mr. Al J.Theis.
Mr. William J. 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,
William J. Rex
Robert A. Lopez
Frank A. Visco
<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,
1995).
REXHALL INDUSTRIES, INC.
Share Price Performance
INDEXED TOTAL RETURN - BASE 100
SOURCES: IDD Information Services via Lexis BASE YEAR = 100: 12/31/95
Company Name 12/95 12/96 12/97 12/98 12/99
REXHALL
INDUSTRIES, INC 100.00 141.86 100.00 167.44 181.40
S&P 500 COMP-LTD
100.00 120.26 157.56 199.58 238.54
PEER GROUP INDEX
Coachmen Industries, Inc.
100.00 130.48 99.13 120.69 69.54
Monaco Coach Corp.
100.00 180.56 283.33 294.44 284.03
Thor Industries, Inc. 100.00 131.61 177.10 131.61 157.10
<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, 1999.
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 31, 2000. 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 quesitons.
ANNUAL REPORT
Rexhall's Annual Report, containing audited financial statements for the
fiscal year ended December 31, 1999, December 31, 1998 and December 31, 1997,
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, 1999, 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. The written request must be directed to
the attention of Investor Relations at Rexhall Industries, Inc., 46147 7th
Street West, Lancaster, CA 93534.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 2001 Annual
Meeting must be received at the Company's principal office no later than
December 28, 2000 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 /s/
Corporate Secretary
DATED: April 17, 2000
Lancaster, California
