APPLEBEE'S INTERNATIONAL, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 6, 1998
To the Stockholders of Applebee's International, Inc.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of Applebee's International, Inc., a Delaware corporation (the
"Company"), will be held on May 6, 1998, at 10:00 a.m., CDT, at the Overland
Park Marriott, 10800 Metcalf, Overland Park, Kansas 66210 for the
following purposes:
I. To elect three directors;
II. To ratify the selection of Deloitte & Touche LLP as independent
auditors for the Company for the 1998 fiscal year; and
III. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
THE BOARD OF DIRECTORS RECOMMENDS A "YES" VOTE ON ALL PROPOSALS.
The Board of Directors has fixed the close of business on March 20, 1998,
as the record date for the determination of stockholders entitled to notice of
and to vote at this Annual Meeting and at any adjournment or postponement
thereof.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. WHETHER OR
NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR REPRESENTATION AT
THE MEETING. A POSTAGE-PREPAID ENVELOPE IS ENCLOSED FOR THAT PURPOSE. EVEN IF
YOU HAVE GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE
MEETING.
By Order of the Board of Directors
Robert T. Steinkamp, Secretary
Overland Park, Kansas
April 6, 1998
<PAGE>
APPLEBEE'S INTERNATIONAL, INC.
--------------
PROXY STATEMENT
--------------
INFORMATION CONCERNING SOLICITATION AND VOTING
General
The enclosed proxy is solicited on behalf of the Board of Directors of
Applebee's International, Inc., a Delaware corporation (the "Company"), for use
at the Annual Meeting of Stockholders (the "Annual Meeting") to be held on May
6, 1998, at 10:00 a.m., CDT, and at any adjournment or postponement thereof, for
the purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders. The Annual Meeting will be held at the Overland Park Marriott,
10800 Metcalf, Overland Park, Kansas 66210.
This proxy statement and accompanying proxy ("Proxy Statement") was mailed
on or about April 6, 1998, to all stockholders entitled to vote at the Annual
Meeting.
Voting Rights and Outstanding Shares
Only stockholders of record at the close of business on March 20, 1998,
will be entitled to notice of and to vote at the Annual Meeting. At the close of
business on March 20, 1998, there were 30,257,011 outstanding shares of the
Company's common stock, par value $.01 per share (the "Common Stock"). Each
share of Common Stock outstanding on the record date is entitled to one vote.
Approval of Proposal II requires the affirmative vote of a majority of the
shares of Common Stock represented at the meeting. Thus, abstentions and broker
non-votes (i.e., shares present in person or by proxy but for which no voting
authority has been given by the beneficial holder) will not affect the vote on
the proposals. Because directors are elected by a plurality of the votes cast,
abstentions and broker non-votes will not affect the outcome of the election of
directors.
On March 20, 1998, the closing sale price reported on The Nasdaq Stock
Market for a share of the Common Stock was $21.9375 (as reported by the National
Quotation Bureau, Inc.).
Revocability of Proxies
Any person giving a proxy pursuant to this solicitation has the power to
revoke it any time before it is voted by filing with the Secretary of the
Company at the Company's principal executive office a written notice of
revocation or a duly executed proxy bearing a later date, or by attending the
Annual Meeting and voting in person.
Solicitation
The Company will bear the entire cost of solicitation of proxies in the
enclosed form, including preparation, assembly, printing and mailing of this
Proxy Statement and any additional information furnished by the Company to
stockholders. Original solicitation of proxies by mail may be supplemented by
telephone, telegraph or personal solicitation by directors, officers or other
regular employees of the Company or by agents employed by the Company for the
specific purpose of supplemental proxy solicitation. Such soliciting agents, if
engaged, will be paid a reasonable fee for their services. No additional
compensation will be paid to directors, officers or other regular Company
employees for such services.
1
<PAGE>
Stockholder Proposals
Proposals of stockholders that are intended to be presented by such
stockholders at the Company's 1999 Annual Meeting of Stockholders must comply
with the rules of the Securities and Exchange Commission ("SEC") and be received
by the Company from qualified stockholders no later than December 5, 1998 in
order to be included in the proxy statement and proxy relating to that meeting.
Certain Information Concerning the Board of Directors
The Board of Directors is classified into three classes, each holding
three-year terms (designated Class I, II, and III). There are currently two
directors in Class I, with terms expiring at the 1999 Annual Meeting, three
directors in Class II, with terms expiring at the 2000 Annual Meeting, and three
directors in Class III, with terms expiring at the 1998 Annual Meeting. The
following information is furnished for each of the three persons being nominated
for election as a Class III director to a new three-year term ("Nominee"), and
for each person who is continuing as a Class I or Class II director of the
Company ("Incumbent").
ABE J. GUSTIN, JR., age 63 (Nominee - Class II term expiring in 2000). Mr.
Gustin has been a director of the Company since September 1983 when the Company
was formed. He served as Chairman of the Board of Directors of the Company from
September 1983 until January 1988 and was again elected as Chairman in September
1992. He was Vice President from November 1987 to January 1988, and from January
1988 until December 1994, he served as President of the Company. Mr. Gustin
served as Chief Executive Officer of the Company through 1996, and effective
January 1, 1997, became Co-Chief Executive Officer along with Lloyd L. Hill. In
January 1998, Mr. Gustin retained his position as the Chairman of the Board and
Mr. Hill assumed the full duties of Chief Executive Officer. From 1983 to 1990,
he also served as Chairman of Juneau Holding Co., a Kansas City, Missouri-based
franchisee which operated Taco Bell restaurants.
LLOYD L. HILL, age 54 (Incumbent - Class III term expiring in 1998). Mr.
Hill was elected a director of the Company in August 1989 and was appointed
Executive Vice President and Chief Operating Officer of the Company in January
1994. In December 1994, he assumed the role of President in addition to his role
as Chief Operating Officer. Effective January 1, 1997, Mr. Hill assumed the role
of Co-Chief Executive Officer along with Mr. Gustin. In January 1998, Mr. Gustin
retained his position as the Chairman of the Board and Mr. Hill assumed the full
duties of Chief Executive Officer. From 1990 to 1994, he served as President of
Kimberly Quality Care, a home health care and nurse personnel staffing company,
where he also served as a director from 1988 to 1994, having joined that
organization in 1980. Mr. Hill serves as a member of the Nominating Committee.
D. PATRICK CURRAN, age 53 (Nominee - Class II term expiring in 2000). Mr.
Curran became a director of the Company in November 1992. He has served as Chief
Executive Officer of the Curran Companies in North Kansas City, Missouri since
August 1979. Mr. Curran serves as a member of the board of directors of
Sealright Co., Inc., Unitog Company, and American Safety Razor Company, all
publicly-traded corporations. Mr. Curran serves as a member of the Audit
Committee, the Executive Compensation Committee and the Nominating Committee.
ERIC L. HANSEN, age 49 (Incumbent - Class I term expiring in 1999). Mr.
Hansen was elected a director of the Company in January 1991. He is presently a
shareholder in the Kansas City law firm of Holman, Hansen & Colville, P.C., a
professional association. From September 1984 to December 1990, he served as a
tax partner at Deloitte & Touche LLP, and from September 1974 to September 1984,
he was a certified public accountant with Deloitte & Touche LLP. Mr. Hansen
serves as a member of the Audit Committee, the Executive Compensation Committee
and the Nominating Committee.
2
<PAGE>
JACK P. HELMS, age 45 (Incumbent - Class III term expiring in 1998). Mr.
Helms became a director of the Company in March 1994. He is presently a
principal and shareholder in the investment banking firm of Goldsmith, Agio,
Helms and Company in Minneapolis, Minnesota. From May 1978 to January 1986, Mr.
Helms was a partner in the law firm of Fredrikson & Byron, P.A. in Minneapolis,
Minnesota. Mr. Helms serves as a member of the Audit Committee, the Executive
Compensation Committee and the Nominating Committee.
KENNETH D. HILL, age 64 (Incumbent - Class I term expiring in 1999). Mr.
Hill became a director of the Company in November 1992 and has agreed to
continue to serve as a director until the Company selects someone to fill his
position on the Board of Directors or for the remainder of his Board term. He
was employed by the Company in April 1991, serving as Executive Vice President
and Chief Operating Officer until January 1994, when he was named President of
International Development. Effective February 28, 1995, Mr. Hill resigned as an
employee and officer of the Company and served as a consultant to the Company
for governmental affairs and industry relations through March 31, 1998. See
"Certain Transactions." From May 1990 to March 1991, he was President and Chief
Executive Officer of Creative Restaurant Management, a company created in a
leveraged buy-out from Gilbert/Robinson, Inc., a Kansas City-based specialty
restaurant group. In March 1992, Creative Restaurant Management filed a petition
for bankruptcy, and the bankruptcy proceeding was terminated in March 1995. Mr.
Hill is an honorary director of the National Restaurant Association, after
having served as both a director of that association and as chairman of most of
its major committees. Mr. Kenneth Hill and Mr. Lloyd Hill are not related.
ROBERT A. MARTIN, age 67 (Nominee - Class II term expiring in 2000). Mr.
Martin was elected a director of the Company in August 1989. In April 1991, he
became Vice President of Marketing, and in January 1994, he was promoted to
Senior Vice President of Marketing. In January 1996, Mr. Martin was promoted to
Executive Vice President of Marketing. From January 1990 to April 1991, he
served as President of Kayemar Enterprises, a Kansas City-based marketing
consulting firm. From 1983 to January 1990, he served as the President, Chief
Operating Officer and a director of Juneau Holding Co., of which Mr. Gustin was
Chairman. From July 1977 to June 1981, he served as President of United Vintners
Winery and prior to that time was employed for 25 years by Schlitz Brewing
Company, most recently in the position of Senior Vice President of Sales and
Marketing.
BURTON M. SACK, age 60 (Incumbent - Class III term expiring in 1998). Mr.
Sack was elected a director and appointed an Executive Vice President of the
Company effective October 24, 1994. In January 1996, Mr. Sack was appointed
Executive Vice President of New Business Development with responsibility for
international franchising. Mr. Sack was the principal shareholder, a director
and the President of Pub Ventures of New England, Inc., a former franchisee of
the Company which was acquired by the Company in October 1994. Mr. Sack retired
as an officer of the Company at the end of the 1997 fiscal year, but continues
to serve as a director. Mr. Sack is a director of the National Restaurant
Association.
The Board has three standing committees: the Audit Committee, the Executive
Compensation Committee and the Nominating Committee. The Audit Committee
recommends engagement of the Company's independent accountants, reviews and
approves services performed by such accountants, reviews and evaluates the
Company's accounting system and its system of internal controls, and performs
other related duties delegated to such Committee by the Board of Directors. The
members of the Audit Committee are Mr. Curran, Mr. Hansen, and Mr. Helms. The
Executive Compensation Committee is responsible for recommending to the Board of
Directors executive compensation levels, bonus plan participation and executive
and overall compensation policies. It also makes awards under the Company's 1995
Equity Incentive Plan. The members of the Executive Compensation Committee are
Mr. Curran, Mr. Hansen and Mr. Helms. The Nominating Committee evaluates and
recommends candidates for nomination to the Board of Directors. Pursuant to the
Company's By-laws, stockholder nominations for Board candidates must be
submitted to the Nominating Committee, along with certain information about the
candidate, at least 60 days prior to the Annual Meeting date. The Nominating
Committee is responsible for reviewing any stockholder nominations. The members
of the Nominating Committee are Mr. Curran, Mr. Hansen, Mr. Helms and Mr. Lloyd
Hill.
3
<PAGE>
During fiscal year 1997, the Board of Directors held ten meetings
(including five regular meetings), the Audit Committee held two meetings, the
Executive Compensation Committee held seven meetings, and the Nominating
Committee held four meetings. During fiscal year 1997, each director attended
more than 75% of the Board meetings and the meetings of the committees on which
such director served.
For director compensation purposes, Mr. Curran, Mr. Hansen and Mr. Helms
were considered "non-employee directors" throughout 1997. During 1997, Mr.
Gustin, Mr. Lloyd Hill, Mr. Martin and Mr. Sack were "employee directors," and
Mr. Kenneth Hill was also treated as an "employee director" pursuant to his
consulting agreement with the Company. Non-employee directors receive an annual
cash retainer of $15,000 plus an annual fee of $5,000 for each committee on
which the director serves, up to a maximum of $10,000 for all such committees.
Employee directors do not receive any compensation for their service on the
Board.
Additionally, the Company's 1995 Equity Incentive Plan provides for
non-employee directors to receive an annual base grant of options to purchase
5,000 shares of Common Stock. The base grant of 5,000 shares will be increased
(i) by 2,000 shares if the Company realizes an increase in Net Income of more
than 20% (defined as income after taxes determined in accordance with generally
accepted accounting principles) over the prior year, and (ii) by 100 shares for
each additional 1% increase in Net Income, but in no event will the total shares
granted in any year (the 5,000 base grant plus the incremental grants) exceed
9,000. There is no provision for the base grant to be decreased. Under the
amended plan, options for 8,800 shares of Common Stock were granted in fiscal
1997 to Mr. Curran, Mr. Hansen and Mr. Helms for serving as non-employee
directors of the Company. In addition, an option for 8,800 shares of Common
Stock was granted in fiscal 1997 to Mr. Kenneth Hill (who, pursuant to his
consulting agreement with the Company, was treated as an employee for director
compensation purposes).
Mr. Kenneth Hill also received cash compensation of $96,750 for services
rendered as a consultant to the Company in fiscal 1997. See "Certain
Transactions." Cash compensation paid and stock options granted to Mr. Gustin
and Mr. Lloyd Hill for services rendered to the Company as employees in fiscal
1997 are shown in the Summary Compensation Table. In addition, Mr. Martin and
Mr. Sack received cash compensation of $246,194 and $162,308 respectively, for
services rendered to the Company as employees in fiscal 1997.
Johyne H. Reck served as a director of the Company until May 1997, and
Raymond D. Schoenbaum served as a director of the Company until August 1997.
Neither Ms. Reck nor Mr. Schoenbaum received any cash compensation from the
Company during 1997 other than director compensation as discussed above. Options
for 8,800 shares of Common Stock were granted in fiscal 1997 to Mr. Schoenbaum
for serving as a non-employee director of the Company, but such options were
canceled upon his resignation.
4
<PAGE>
Certain Information Concerning Executive Officers
Information regarding the executive officers of the Company, who are not
also directors of the Company, as of December 28, 1997, is as follows:
<TABLE>
<CAPTION>
Name Age Position
<S> <C> <C>
George D. Shadid........................ 43 Executive Vice President, Chief Financial Officer and
Treasurer
Louis A. Kaucic......................... 46 Senior Vice President of Human Resources
Steven K. Lumpkin....................... 43 Senior Vice President of Strategic Development
Ronald J. Marks......................... 42 Senior Vice President of Research and Development
(resigned in March 1998)
Stuart F. Waggoner...................... 52 President and Chief Executive Officer of Rio Bravo
International, Inc. (a wholly-owned subsidiary of
Applebee's International, Inc.)
</TABLE>
GEORGE D. SHADID was employed by the Company in August 1992, and served as
Senior Vice President and Chief Financial Officer until January 1994 when he was
promoted to Executive Vice President and Chief Financial Officer. He also became
Treasurer in March 1995. From 1985 to 1987, he served as Corporate Controller of
Gilbert/Robinson, Inc., at which time he was promoted to Vice President, and in
1988 assumed the position of Vice President and Chief Financial Officer, which
he held until joining the Company. From 1976 until 1985, Mr. Shadid was employed
by Deloitte & Touche LLP.
LOUIS A. KAUCIC was employed by the Company in November 1997 as Senior Vice
President of Human Resources. From July 1992 until November 1997, Mr. Kaucic was
Vice President of Human Resources and later promoted to Senior Vice President of
Human Resources with DAKA International, which operates several restaurant
concepts. From 1982 to 1992, he was employed by Pizza Hut in a variety of
positions, including Director of Employee Relations. From 1978 to 1982, Mr.
Kaucic was employed by Kellogg's as an Industrial Relations Manager.
STEVEN K. LUMPKIN was employed by the Company in May 1995 as Vice President
of Administration. In January 1996, he was promoted to Senior Vice President of
Administration. In November 1997, he assumed the position of Senior Vice
President of Strategic Development. From July 1993 until January 1995, Mr.
Lumpkin was a Senior Vice President with a division of the Olsten Corporation,
Olsten Kimberly Quality Care. From June 1990 until July 1993, Mr. Lumpkin was an
Executive Vice President and a member of the board of directors of Kimberly
Quality Care. From January 1978 until June 1990, Mr. Lumpkin was employed by
Price Waterhouse LLP, where he served as a management consulting partner and
certified public accountant.
RONALD J. MARKS has been an employee of the Company since March 1988 and
served as Director of Product Development until March 1991, when he became
Director of Menu Development. In February 1992, he was promoted to Executive
Director of Research and Development, and in February 1993, Mr. Marks was
promoted to Vice President of Research and Development. He was promoted to
Senior Vice President of Research and Development in January 1997. Mr. Marks
resigned as an officer and employee of the Company in March 1998.
STUART F. WAGGONER has been an employee of the Company since December 1988
and served as the Executive Director of Franchise Operations until March 1991,
when he became Vice President of Franchise Operations. In December 1994, Mr.
Waggoner assumed the newly created position of Senior Vice President of
Operations, with overall responsibility for franchise and Company owned
Applebee's restaurant operations. In October 1997, Mr. Waggoner was appointed
President and Chief Executive Officer of Rio Bravo International, Inc., a
wholly-owned subsidiary of Applebee's International, Inc. From October 1987 to
December 1988, Mr. Waggoner was a Vice President of Operations for Eateries',
Inc., a restaurant company based in Oklahoma City, Oklahoma. From 1985 to July
1987, Mr. Waggoner was President of Pendleton's Bar & Grill in Dallas, Texas.
From October 1974 to March 1985, Mr. Waggoner was Vice President of Restaurant
Administration for TGI Friday's, Inc., in Dallas, Texas.
5
<PAGE>
Security Ownership of Officers, Directors and Certain Beneficial Owners
The following table sets forth information, as of March 20, 1998, regarding
the ownership of Common Stock, the Company's only class of outstanding
securities, by (i) each person known by the Company to own beneficially more
than 5% of the outstanding shares of Common Stock, (ii) each director and each
executive officer named in the Summary Compensation Table, and (iii) all
executive officers and directors of the Company as a group. Unless otherwise
indicated, each of the stockholders has sole voting and investment power with
respect to the shares beneficially owned.
<TABLE>
<CAPTION>
Beneficial Ownership(1)
-------------------------------
Number of Percent
Shares Held
-------------- -------------
<S> <C> <C>
Massachusetts Financial Services Company............................... 4,037,395 13.3%
500 Boylston Street
Boston, MA 02116
AIM Management Group, Inc.............................................. 1,881,900 6.2%
11 Greenway Plaza, Suite 1919
Houston, TX 77046
Burton M. Sack (2)..................................................... 2,026,020 6.7%
Abe J. Gustin, Jr. (2)................................................. 1,108,000 3.7%
Lloyd L. Hill (2)...................................................... 129,086 0.4%
Kenneth D. Hill (2).................................................... 85,800 0.3%
Robert A. Martin (2)................................................... 85,367 0.3%
D. Patrick Curran (2).................................................. 76,800 0.3%
George D. Shadid (2)................................................... 70,101 0.2%
Eric L. Hansen (2)..................................................... 59,850 0.2%
Jack P. Helms (2)...................................................... 58,800 0.2%
Stuart F. Waggoner (2)................................................. 34,500 0.1%
Steven K. Lumpkin (2).................................................. 10,475 -
All executive officers and directors as a group (13 persons) (2)....... 3,745,199 12.4%
- - ---------------
<FN>
(1) The mailing address of each individual is 4551 W. 107th Street, Suite 100,
Overland Park, Kansas 66207, unless otherwise shown.
(2) Includes certain shares subject to options exercisable as of March 20, 1998
or within 60 days thereafter: 9,000 shares for Mr. Sack, 58,000 shares for
Mr. Gustin, 116,000 shares for Lloyd L. Hill, 85,300 shares for Kenneth D.
Hill, 59,000 shares for Mr. Martin, 71,800 shares for Mr. Curran, 45,000
shares for Mr. Shadid, 53,800 shares for Mr. Hansen, 53,800 shares for Mr.
Helms, 34,500 shares for Mr. Waggoner, 10,000 shares for Mr. Lumpkin, and
596,200 shares for all executive officers and directors as a group.
</FN>
</TABLE>
Mr. Gustin is a party to a voting agreement, pursuant to which he has
agreed to vote all voting securities of the Company held by him at any time (i)
to maintain the size of the Board of Directors at ten members unless otherwise
mutually agreed, (ii) to vote for his election as a director of the Company at
each election of directors, (iii) to vote against his removal as a director of
the Company, and (iv) to vote his shares so that the Board of Directors has at
least two independent directors at all times. In addition, in the event of Mr.
Gustin's death, the voting agreement contains provisions relating to voting for
the election of a successor director of the deceased party. The voting agreement
terminates in 1999, and does not apply to any voting securities transferred to a
third party in a public transaction.
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of the Common Stock,
to file certain reports of ownership and changes in ownership with the SEC.
Officers, directors and persons owning beneficially greater than 10% of the
Company's Common Stock are required by SEC regulations to furnish the Company
with copies of all such reports.
6
<PAGE>
Based solely on its review of the copies of such reports received by the
Company, or written representations from certain reporting persons, the Company
believes that all filing requirements applicable to its officers, directors, and
greater than 10% beneficial owners were complied with during the fiscal year
ended December 28, 1997, except that one report was not timely filed by Richard
K. Horn, Vice President of Concept Development, one report was not timely filed
by Louis A. Kaucic, Senior Vice President of Human Resources, and one report was
not timely filed by Robert T. Steinkamp, Vice President and General Counsel. The
transactions were reported by each of these individuals in subsequent filings.
PROPOSAL I
ELECTION OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
IN FAVOR OF EACH NAMED NOMINEE.
Shares of Common Stock represented by executed proxies will be voted, if
authority to do so is not withheld, for the election of the Nominees named
below. If any Nominee should become unavailable for election as a result of an
unexpected occurrence, such shares will be voted for the election of such
substitute Nominee as the Company may propose. Each person nominated for
election has agreed to serve if elected, and the Company has no reason to
believe that any Nominee will be unavailable to serve. Additional information
concerning the following Nominees is set forth in "Certain Information
Concerning the Board of Directors."
The Company has a classified Board of Directors so that each director
serves a three-year term. If elected, each of the below nominees would serve
until the 2001 Annual Meeting of Stockholders and until his successor is elected
and has qualified or until his earlier death, resignation or removal.
<TABLE>
<CAPTION>
Current Position Director
Name Age With The Company Since
------------------------------- ------------ -------------------------------------------- ---------------
<S> <C> <C> <C>
Lloyd L. Hill 54 Chief Executive Officer, President 1989
and Chief Operating Officer
Jack P. Helms 45 Director 1994
Burton M. Sack 60 Director 1994
</TABLE>
PROPOSAL II
RATIFICATION OF DELOITTE & TOUCHE LLP AS INDEPENDENT
AUDITORS FOR THE COMPANY FOR THE 1998 FISCAL YEAR
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THIS PROPOSAL.
The Company has selected the accounting firm of Deloitte & Touche LLP to
serve as the Company's independent auditors for the 1998 fiscal year. The
stockholders are being asked to ratify this selection. Representatives of
Deloitte & Touche LLP are expected to be present at the Annual Meeting. Such
representatives will have the opportunity to make a statement at the Annual
Meeting if they so choose and will be available to respond to appropriate
questions.
7
<PAGE>
EXECUTIVE COMPENSATION
Executive Compensation Committee Report
This report discusses the manner in which base salaries and incentive
compensation for Abe J. Gustin, Jr. and Lloyd L. Hill, the Company's Co-Chief
Executive Officers ("CEO"), and the other executives named in the Summary
Compensation Table (the "Named Executives") were determined for the 1997 fiscal
year.
The Company continues to believe that its past growth and success have
been, and that its continued growth and success will be dependent in part on its
ability to attract and retain highly-qualified senior management. In addition,
the Company believes that executive officers should have their personal
financial interests closely aligned with stockholder value. As a result, the
Company established executive total direct compensation levels for 1997 that it
believes are competitive with restaurant industry leaders, based on the
compensation survey described below, and focused on the Company's operating
performance. The Company's executive compensation arrangements consist of three
primary parts: competitive base salary levels, significant Company
performance-based bonus payments, and stock options. The Committee believes that
these components are appropriate ways to provide the Company's executives
financial security and motivation to increase profitability both in the
near-term and over time. The Committee used the advice of an independent
compensation consultant on executive compensation issues. The Company had
written employment agreements in effect throughout 1997 with Mr. Gustin, Mr.
Hill and Mr. Shadid. The Company's executive employment agreements address only
first-year base salary levels and, therefore, did not determine 1997
compensation levels. Base salary, bonus and stock option levels are left to the
discretion of the Committee each year.
In reviewing compensation levels for 1997, the Committee reviewed and
updated existing executive salary and bonus policies in order to provide the
Company's executive officers with appropriate financial and motivational
arrangements in 1997 and the future. The Committee compared the base salaries,
incentives and total cash compensation paid to the Company's executives with
those paid by other companies in four categories:
Performance graph customized industry peer group -- consisting of the
seven publicly-traded restaurant companies comprising the customized
industry peer group used in the performance graph included in the
Company's 1996 Proxy Statement.
Historical peer group -- consisting of the performance graph customized
industry peer group plus 12 additional publicly-traded restaurant
companies. This is the same group the Committee used in 1995 to
evaluate 1996 executive compensation levels.
Industry leader peer group -- consisting of 10 publicly-traded
restaurant companies, three of which are included in the performance
graph customized industry peer group, four more of which are included
in the Historical peer group, and three of which are not in either of
the other industry peer groups.
Service industry peer group -- consisting of eight publicly-traded
health care and retail companies with annual revenues in excess of $1
billion.
The Committee directed the compensation consultant as to which specific
companies to use in its study. The companies were selected because they were
generally comparable to the Company in size and recent growth rate. The
Committee's review of this data and of an industry compensation analysis
prepared by the consultant resulted in the base salary increases described
below.
8
<PAGE>
Base Salary
In determining the 1997 base salaries for the CEO and Named Executives, the
Committee considered several criteria, including growth in stockholder value,
free cash flow, earnings before interest, taxes, depreciation, and amortization
("EBITDA"), net earnings, franchisee relations and new restaurant openings.
These criteria were not weighted by any predetermined formula, but rather, were
considered in light of the overall achievement of the Company's goals and of
general industry and economic factors. The significance of any particular
criterion varied depending upon the particular position or area of
responsibility of the executive in question. Mr. Gustin's 1997 base salary of
$500,000 represented an increase of 7.5% over 1996 and reflected the continued
strong operational and financial performance of the Company and of the
Applebee's franchise system, evidenced by, among other things, continued
earnings growth, operating margin improvement, and another year of a record
number of restaurant openings. Mr. Hill's 1997 base salary of $420,000
represented an increase of 23.5% over 1996 and reflected the increased duties
and responsibilities commensurate with Mr. Hill's new role in 1997 as Co-Chief
Executive Officer, as well as the continued strong operational and financial
performance of the Company.
It is the policy of the Company to review executive base salaries in
relation to comparable positions in the restaurant industry. The Committee
believes that base salaries should remain competitive with industry leaders, but
not significantly exceed the median.
Incentive Compensation
The Committee believes that a significant part of compensation for the CEO
and other senior executives should continue to be based on the achievement of
operating and financial goals. The incentive plan is targeted to provide award
opportunities approximately equal to the 75th percentile of total annual cash
compensation for comparable positions among industry leaders. The Company uses a
combination of cash bonuses and equity awards as incentives for its executives
and other employees. Under the cash bonus plan, the Committee established
operating and financial goals for the Company and individual bonus payments,
based on a percentage of base salary, to be paid at various levels of goal
achievement. The Committee believes that this program provides an appropriate,
attractive incentive opportunity to the Company's executives for both short-term
and long-term rewards.
The Committee established the 1997 minimum achievement level to receive
bonus payments under the cash bonus plan at 91% of the Company's internal
targeted net income, an increase from the 88% minimum achievement level used in
1996. The maximum achievement level for 1997 established under the cash bonus
plan was 98.6% of the Company's internal targeted net income. The plan allows
the Committee to exclude items from the calculation of net income when it
believes that it is equitable to do so. In July of 1997, the Committee excluded
the results of the April 1997 acquisition of certain restaurants in St. Louis
from the bonus plan calculation and reduced the level of targeted net income at
which the maximum bonus would be payable to 96.2%. Under the terms of the bonus
plan, a mid-year bonus calculation was made based on the Company's performance
through the second fiscal quarter, and 75% of the bonus amount earned at such
time was paid and 25% was withheld pending calculation of the full year results.
Through the end of the second fiscal quarter of 1997, performance was at the
100% bonus payment level (as revised), and Mr. Gustin and Mr. Hill and each of
the Named Executives received a bonus payment of 75% of one-half of their
maximum annual bonus potential for 1997 which equated to 37.5% of their maximum
annual bonus potential. At the end of the 1997 fiscal year, the final bonus
calculation was below the minimum level of performance established to earn any
bonus and so neither the accrued 25% of the mid-year payment nor any additional
bonus payments were made.
9
<PAGE>
Stock Options
The Committee believes that stock option grants and other equity-related
compensation programs are important elements of the Company's executive
compensation program and will continue to be used to attract, motivate and
retain experienced, qualified members of management. Stock options are awarded
under the 1995 Equity Incentive Plan. Options are granted at 100% of fair market
value on date of grant, and can be exercised (following a required holding
period) at any time over a 10 year period. In 1996, the Committee implemented
significant changes in the Company's approach to stock options by informing the
executives that grants will be made once every three years rather than annually
and by changing the vesting schedule for these options to vest 50% after three
years, 25% after four years and 25% after five years. As a result, no options
were granted to Mr. Gustin, Mr. Hill, or any of the Named Executives during
1997.
Other Information
Section 162(m) of the Internal Revenue Code places an annual limitation of
$1,000,000 on the compensation of certain executive officers of publicly held
corporations that can be deducted for federal income tax purposes unless such
compensation is based on performance. No executive of the Company received
annual compensation in excess of $1,000,000 in 1997 or in any prior year. The
Company's bonus and equity-based compensation plans are designed to meet the
requirements of Section 162(m) by basing incentive compensation on identifiable
performance criteria. The Committee does not anticipate that any executive base
salary will exceed $1,000,000.
EXECUTIVE COMPENSATION COMMITTEE
D. Patrick Curran
Eric L. Hansen
Jack P. Helms
Compensation Committee Interlocks and Insider Participation
The Executive Compensation Committee consists entirely of individuals who
are neither officers nor employees of the Company. The Company leases certain
office space under an operating lease from a partnership in which Mr. Schoenbaum
holds a 37.5% interest. The Company paid $120,000 under this lease in the 1997
fiscal year. The Company believes that the terms of the lease reflect fair
market value rentals which are comparable to those which could have been
obtained from an unaffiliated third party. Mr. Schoenbaum resigned from the
Board of Directors in August 1997.
10
<PAGE>
Summary Compensation Table
The following Summary Compensation Table sets forth the compensation of the
Co-Chief Executive Officers and each of the next three most highly compensated
executive officers in each of their respective positions with the Company whose
annual salary and bonuses exceeded $100,000 for services in all capacities to
the Company during the last three fiscal years.
<TABLE>
<CAPTION>
==================================================================================================================
SUMMARY COMPENSATION TABLE
==================================================================================================================
Long Term
Compensation
Annual Compensation Awards
------------------------------------------------------------------------------
Other Annual
Fiscal Salary Bonus(1) Compensation(2) Options(3)
Name and Principal Position Year ($) ($) ($) (#)
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Abe J. Gustin, Jr. 1997 $ 498,654 $ 112,500 $ -- --
Chairman and Co-Chief Executive 1996 463,462 139,500 -- 100,000
Officer 1995 423,077 318,750 -- 59,000
Lloyd L. Hill 1997 $ 416,923 $ 94,500 $ 7,076 --
Co-Chief Executive Officer, 1996 338,432 102,000 14,243 100,000
President and Chief Operating 1995 308,655 232,500 95,576 72,000
Officer
George D. Shadid 1997 $ 295,039 $ 111,050 $ 4,941 --
Executive Vice President and 1996 269,362 74,525 23,267 75,000
Chief Financial Officer 1995 238,462 180,000 11,221 30,000
Steven K. Lumpkin(4) 1997 $ 228,946 $ 58,125 $ -- --
Senior Vice President of 1996 198,077 50,000 -- 50,000
Strategic Development 1995 98,077 93,750 -- 25,000
Stuart F. Waggoner 1997 $ 209,231 $ 38,391 $ -- --
President and Chief Executive 1996 188,461 47,500 3,241 50,000
Officer of Rio Bravo 1995 148,462 105,000 20,270 38,500
International, Inc.
- - ---------------
<FN>
(1) Represents payments made under the Company's cash bonus plan. Amounts
applicable to Mr. Shadid and Mr. Lumpkin for 1997 also include $50,000 and
$15,000, respectively, for discretionary bonuses approved by the Executive
Compensation Committee. In addition, amounts applicable to Mr. Lumpkin for
1995 include a bonus of $30,000 paid in 1995 pursuant to an agreement made
at the time he joined the Company as an officer.
(2) Represents payments made in connection with the Company's non-qualified
retirement savings plan. Amounts applicable to Mr. Hill also include moving
and relocation expense reimbursements of $84,868 in 1995. Amounts
applicable to Mr. Waggoner ($3,241 in 1996 and $20,270 in 1995) relate to
one-time payments made to account for increased income taxes incurred by
him as a result of adjustments made by the Company to certain stock
options.
(3) Represents options granted pursuant to the Company's 1989 Stock Option Plan
and 1995 Equity Incentive Plan, including options granted to directors who
were also executive officers in 1995 (see "Certain Information Concerning
the Board of Directors").
(4) Mr. Lumpkin's employment with the Company commenced May 1, 1995.
</FN>
</TABLE>
11
<PAGE>
During 1997, the Company had written employment agreements with Mr. Gustin,
Mr. Hill and Mr. Shadid. Each of the employment agreements provides for periodic
salary adjustments as determined by the Executive Compensation Committee. In
January 1998, Mr. Hill's salary was increased to $470,000, and Mr. Shadid's
salary was increased to $310,000.
Effective January 1, 1996, the Company and Mr. Gustin entered into a new
two-year employment agreement. The agreement allows periodic salary increases as
determined by the Executive Compensation Committee and provides a 26 month
severance payment based on the current year's salary and the greater of the
annualized current year's bonus or prior year's bonus (the "Severance Amount")
in the event of termination by the Company without cause (as defined) or by Mr.
Gustin with reason (as defined). Upon such a termination, if Mr. Gustin elects
to receive the Severance Amount, the agreement imposes a noncompetition and an
employee nonsolicitation clause. Upon any other termination, the agreement
allows the Company to impose the noncompetition and nonsolicitation provisions
for up to two years upon a payment of 50% of Mr. Gustin's base salary. The
agreement also provides for a lump sum payment equal to 26 times his current
year's monthly salary plus bonus, plus an amount equal to all bonuses paid or
accrued in the fiscal year of termination, without the imposition of a
noncompetition or nonsolicitation clause, in the event Mr. Gustin resigns or is
terminated following a change in control. The agreement was amended as of
December 31, 1997 to extend the term for an additional two-year period, expiring
on December 31, 1999. Under the terms of the amendment, Mr. Gustin's base salary
for 1998 will be $500,000, and he will not participate in the Company's
incentive compensation or stock option plans.
Mr. Hill's agreement was for an original term of one year, expiring in
January 1995, and automatically renews for successive one-year terms unless
otherwise terminated as provided in the agreement. The Company also entered into
a severance and noncompetition agreement with Mr. Hill which provides a
continuation of salary, bonus and benefits for a period of three years following
certain "triggering events," including termination by the Company without cause
or termination by Mr. Hill if the Company substantially reduces his
compensation, benefits, or duties or requires a relocation from the Kansas City
area. If the three-year severance payments are due, Mr. Hill will be bound by a
three-year non-compete. If the severance payments are not due, the Company can
elect to impose a one-year non-compete on Mr. Hill if it pays him 50% of his
base salary.
Effective March 1, 1995, the Company and Mr. Shadid entered into a new
employment agreement with an initial term ending December 29, 1996, and
renewable thereafter for additional one year terms. The agreement allows
periodic salary increases as determined by the Executive Compensation Committee
and provides a 26 month severance payment based on the current year's salary and
the greater of the annualized current year's bonus or prior year's bonus (the
"Severance Amount") in the event of termination by the Company without cause (as
defined) or by Mr. Shadid with reason (as defined). If Mr. Shadid elects to
receive the Severance Amount, the agreement imposes a noncompetition and an
employee nonsolicitation clause. The agreement also provides for a lump sum
payment equal to 26 times his current year's monthly salary plus bonus, plus an
amount equal to all bonuses paid or accrued in the fiscal year of termination,
without the imposition of a noncompetition or nonsolicitation clause, in the
event Mr. Shadid resigns or is terminated following a change in control.
During 1997, the Company had severance arrangements with other officers of
the Company (six persons), which provide for lump sum payments in the event the
employee resigns or is terminated following a change in control of the Company
in an amount equal to (i) one and two-thirds times the officer's cash
compensation for the prior year (salary plus bonus), and (ii) the amount of all
bonuses paid or accrued in the fiscal year of termination. If all officers with
change in control severance agreements (eight persons) had been terminated as of
December 28, 1997, as a result of a change in control, the Company would have
been required to make payments under the change in control severance provisions
of the above agreements aggregating approximately $4,900,000.
12
<PAGE>
The following table sets forth information regarding the year-end value of
unexercised options with respect to the Co-Chief Executive Officers and the next
three most highly compensated executive officers. No options were granted to or
exercised by these individuals during 1997.
===============================================================================
FISCAL YEAR-END OPTION VALUES
===============================================================================
Number of Value of Unexercised
Securities Underlying In-The-Money
Unexercised Options at Options at
12/28/97 12/28/97(1)
(#) ($)
------------------------ ------------------------
Exercisable/ Exercisable/
Name Unexercisable Unexercisable
- - --------------------- -------------------------- ------------------------
Abe J. Gustin, Jr. 58,000/150,000 $ 233,940/$ --
Lloyd L. Hill 116,000/140,000 361,531/ --
George D. Shadid 45,000/105,000 228,050/ --
Steven K. Lumpkin 10,000/ 65,000 --/ --
Stuart F. Waggoner 34,500/ 70,000 76,584/ --
- - --------------
(1) Based upon the closing sale price of the Common Stock on December 26, 1997
(the last trading day in fiscal year 1997).
13
<PAGE>
Performance Graph
The following graph compares the annual change in the Company's
cumulative total stockholder return for the five fiscal years ended December 28,
1997 (December 27, 1992 to December 28, 1997) based upon the market price of the
Company's Common Stock, compared with the cumulative total return on Media
General's Nasdaq Total Return Index and the Media General Restaurant Industry
Index as indexed by Media General. The Media General Nasdaq Index includes both
the Nasdaq NMS and Nasdaq Small-Cap Issuers indices. The Media General
Restaurant Industry Index includes approximately 140 restaurant companies.
APPLEBEE'S INTERNATIONAL, INC.
Performance Graph
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
APPLEBEE'S INTERNATIONAL, INC. VS. NASDAQ TOTAL RETURN INDEX
VS. MEDIA GENERAL RESTAURANT INDUSTRY INDEX
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Media
Measurement Period NASDAQ General
(Fiscal Year Covered) Applebee's Total Return Restaurant
Measurement Point International, Inc. Index Industry Index
- - ----------------------------------- ------------------- ------------ --------------
<S> <C> <C> <C>
December 27, 1992 $ 100.00 $ 100.00 $ 100.00
December 26, 1993 $ 221.86 $ 119.95 $ 109.27
December 25, 1994 $ 160.14 $ 125.94 $ 98.38
December 31, 1995 $ 245.53 $ 163.35 $ 134.44
December 29, 1996 $ 294.83 $ 202.99 $ 135.93
December 28, 1997 $ 203.58 $ 248.30 $ 141.80
</TABLE>
ASSUMES $100 INVESTED ON DECEMBER 27, 1992
ASSUMES DIVIDENDS REINVESTED
FISCAL YEAR ENDING DECEMBER 28, 1997
14
<PAGE>
Certain Indemnification Agreements
The Company has entered into Indemnification Agreements with each of its
directors and officers. Under the Indemnification Agreements, the Company has
agreed to hold harmless and indemnify each indemnitee generally to the full
extent permitted by Section 145 of the Delaware General Corporation Law and
against any and all liabilities, expenses, judgments, fines, penalties and costs
in connection with any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative to which
the indemnitee is made a party by reason of the fact that the indemnitee has, is
or at the time becomes a director or officer of the Company or any other entity
at the request of the Company. The indemnity does not cover liability arising
out of fraudulent acts, deliberate dishonesty or willful misconduct, violations
of certain securities laws, or if a court determines that such indemnification
is not lawful. In addition, the By-laws of the Company provide for
indemnification to all officers and directors of the Company to essentially the
same extent as provided in the indemnification agreements.
The Company presently carries director and officer liability insurance to
insure its directors and officers against certain liabilities they might incur
in connection with performing their duties for the Company. The proceeds of such
insurance would be available to the extent thereof to satisfy any obligation of
the Company to indemnify its directors or officers with respect to the liability
giving rise to the insurance proceeds. The insurance does not cover all
liabilities that could give rise to indemnification by the Company.
CERTAIN TRANSACTIONS
The Company and certain franchisees have obtained restaurant equipment from
Sal Reck Equipment Company. Sal Reck, the owner of such company, is the
father-in-law of Johyne H. Reck, who was a director of the Company until May
1997. During the 1997 fiscal year, the Company paid $264,000 for equipment and
services purchased from Sal Reck Equipment Company. The Company believes that
all such transactions have been on terms at least as favorable as could have
been obtained from unaffiliated third parties.
One of the Company's restaurants is leased from a corporation in which Abe
J. Gustin, Jr., Johyne H. Reck (who was a director of the Company until May
1997), and Ronald B. Reck (Ms. Reck's husband and a former officer of the
Company) each owns a 25% interest. During 1995, the Company entered into an
agreement with this corporation to lease additional parking space for this
restaurant. The Company paid $166,000 under these leases in the 1997 fiscal
year. The Company believes that the terms of the leases reflect fair market
value rentals which are comparable to those which could have been obtained from
an unaffiliated third party. Abe J. Gustin, Jr. personally guaranteed a
restaurant lease for a former franchisee in Dallas. When the Company undertook
the operation of this franchise restaurant it agreed to assume the lease
prospectively. This decision was approved by a majority of the disinterested
members of the Board of Directors. Mr. Gustin remains liable on his guarantee.
In the 1997 fiscal year, the aggregate payments made by the Company on the lease
were $97,000.
Mr. Gustin's brother and a brother-in-law own two of the Company's
franchisees, A.N.A., Inc., which operates 10 Applebee's restaurants, and
Miss-Ala-Rio, Inc., which operates one Rio Bravo Cantina restaurant. In December
1997, A.N.A., Inc. and its affiliate, Quality Restaurant Concepts, LLC ("QRC")
entered into a letter of intent to acquire 26 restaurants from Apple South,
Inc., the Company's largest franchisee, which is expected to be completed during
the second quarter of 1998. The Company has agreed to guarantee $1,000,000 of
the amount QRC will be borrowing related to this acquisition. The guarantee will
be reduced by the amount of principal payments and will terminate after QRC
repays $1,000,000 of its borrowings.
Another brother-in-law of Mr. Gustin owns Apple-Bay East, Inc., a
franchisee of the Company which operates five Applebee's restaurants. The
development and franchise agreements of A.N.A., Inc., Miss-Ala-Rio, Inc., and
Apple-Bay East, Inc. are standard in form and require payment of standard
franchise, royalty, and advertising fees.
15
<PAGE>
In April 1997, the Company acquired the assets of 11 operating Applebee's
franchise restaurants in St. Louis for approximately $36,100,000. One of the
principals of the franchisee is related to Johyne H. Reck, who was a director of
the Company until May 1997.
In March 1998, the Company entered into an agreement to purchase a tract of
land for future restaurant development for $290,000 from an entity in which Mr.
Gustin has a one-third ownership interest. The purchase price is less than
current appraised value.
The Company leases certain office space under an operating lease from a
partnership in which Raymond D. Schoenbaum, who was a director of the Company
until August 1997, holds a 37.5% interest. The Company paid $120,000 under this
lease in the 1997 fiscal year. The Company believes that the terms of the lease
reflect fair market value rentals which are comparable to those which could have
been obtained from an unaffiliated third party.
The Company had a consulting agreement with Mr. Kenneth Hill to act as a
consultant to the Company for governmental affairs and restaurant industry
relations that expired March 1, 1998 and was extended through March 31, 1998.
Mr. Hill was paid $200,000 for the first year of the agreement, $150,000 for the
second year, and $86,000 for the final period of the agreement. The agreement
contains nondisclosure, noncompetition, and employee nonsolicitation clauses and
also provides that all concepts and discoveries conceived by Mr. Hill alone or
with others become the exclusive property of the Company. Mr. Hill has agreed to
continue to serve as a director for the remainder of his Board term or until the
Company selects someone to fill his position on the Board of Directors.
OTHER MATTERS
The Company knows of no other matters to be considered at the Annual
Meeting. However, if any other matters are properly presented at the meeting, it
is the intention of the persons named in the accompanying proxy to vote in
respect thereof in accordance with their best judgment.
The Board of Directors encourages each stockholder to attend the Annual
Meeting. Whether or not you plan to attend, you are urged to complete, sign and
return the enclosed proxy in the accompanying envelope. A prompt response will
greatly facilitate arrangements for the meeting, and your cooperation will be
appreciated. Stockholders who attend the meeting may vote their shares
personally even though they have sent in their proxies.
By Order of the Board of Directors
Robert T. Steinkamp, Secretary
Applebee's International, Inc.
4551 W. 107th Street, Suite 100
Overland Park, Kansas 66207
Overland Park, Kansas
April 6, 1998
16
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF APPLEBEE'S INTERNATIONAL, INC.
ANNUAL MEETING OF STOCKHOLDERS, MAY 6, 1998
The undersigned hereby appoints each of Abe J. Gustin, Jr. and Robert
T. Steinkamp the proxy and attorney-in-fact of the undersigned with full power
of substitution for and in the name of the undersigned to attend the Annual
Meeting of Stockholders of Applebee's International, Inc., to be held at the
Overland Park Marriott, 10800 Metcalf, Overland Park, Kansas 66210 on May 6,
1998, at 10:00 a.m., CDT, and any and all adjournments thereof, and to vote
thereat the number of shares of Common Stock of Applebee's International, Inc.,
which the undersigned would be entitled to vote if then personally present. The
Board of Directors recommends votes FOR proposals I and II.
I. To elect three directors to serve until the 2001 Annual Meeting of
Stockholders or until their earlier resignation;
Nominees: Lloyd L. Hill, Jack P. Helms and Burton M. Sack;
[ ] FOR all nominees listed above.
[ ] FOR all nominees listed above except ___________________.
[ ] WITHHOLD AUTHORITY to vote for all nominees listed above.
II. To ratify the selection of Deloitte & Touche LLP as independent
auditors for the Company for the 1998 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
III. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THE PROXY WILL BE VOTED
FOR PROPOSALS I AND II.
Signature _______________ Date _________
Signature _______________ Date _________
Sign exactly as name appears hereon. When
shares are held by joint tenants, both
should sign. When signing as attorney,
executor, administrator, trustee or
guardian, give full title. If a
corporation, sign full corporate name by
President or other authorized officer. If
a partnership, sign in partnership name by
authorized partner.
MARK, DATE, SIGN, AND PROMPTLY RETURN
PROXY CARD IN ENCLOSED ENVELOPE.
