800 East 101st Terrace
Kansas City, Missouri 64131
---------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on November 11, 1998
-------------------------------
To Our Shareholders:
The Annual Meeting of Shareholders of The Rival Company (the "Company") will
be held at the Doubletree Hotel, 10100 College Boulevard, Overland Park,
Kansas, at 9:00 a.m. Central Standard Time, on Wednesday, November 11, 1998 for
the following purposes:
1. To elect a Board of Directors for the upcoming year;
2. To act upon a proposal to ratify the appointment of KPMG Peat Marwick as
independent public accountants for the Company for the fiscal year ending
June 30, 1999; and
3. To transact such other business, if any, as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on September 14,
1998, as the record date for the determination of Shareholders entitled to
notice of and to vote at the meeting.
Your vote is important. Please sign and date the enclosed proxy card and
return it promptly in the enclosed return envelope, whether or not you expect
to attend the meeting. Sending in your Proxy now will not interfere with your
rights to attend the meeting or to vote your shares personally at the meeting
if you wish to do so.
By Action of the Board of Directors
Stanley D. Biggs,
Secretary
Kansas City, Missouri
September 15, 1998
<PAGE>
This page left blank intentionally.
2
<PAGE>
PROXY STATEMENT
1998 ANNUAL MEETING OF SHAREHOLDERS
OF
THE RIVAL COMPANY
-----------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of The Rival Company for the Annual Meeting
of Shareholders to be held on November 11, 1998.
The close of business on September 14, 1998, has been fixed as the record
date for the determination of the Shareholders entitled to notice of, and to
vote at, the Annual Meeting. On that date there were 9,296,477 shares of Common
Stock outstanding and entitled to vote at the meeting. Each share of Common
Stock is entitled to one non-cumulative vote as to each nominee and issue
presented.
Shares represented by proxies will be voted in accordance with the
specifications made on the proxy card by the shareholder. Any proxy not
specifying the contrary will be voted in favor of the Board of Directors'
nominees for election as Directors and in favor of ratifying the selection of
the accounting firm of KPMG Peat Marwick as independent auditors of The Rival
Company. A shareholder giving a proxy has the right to revoke it at any time
before it is voted by giving to the Secretary of the Company written notice of
revocation bearing a later date than the proxy, by submission of a later-dated
proxy, or by revoking the proxy and voting in person at the Annual Meeting.
Abstentions and broker non-votes are counted for purposes of determining the
presence or absence of a quorum for the transaction of business. Directors will
be elected by a plurality of the votes cast by shareholders and the nine
nominees who receive the most votes will be elected. Therefore, abstentions and
broker non-votes will not be taken into account in determining the outcome of
the election. In order to be approved, the ratification of the appointment of
the independent auditors must receive the affirmative vote of a majority of the
shares present in person or by proxy at the meeting and entitled to vote.
Therefore, abstentions and broker non-votes on this matter have the effect of
negative votes.
The principal executive offices of the Company are located at 800 East 101st
Terrace, Kansas City, Missouri 64131. This Proxy Statement and the enclosed
proxy card are being furnished to shareholders on or about September 21, 1998.
3
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors of the Company is currently composed of nine
directors, whose terms of office will expire upon the election of their
successors at the Annual Meeting. At the meeting, the shareholders will be
asked to elect nine directors to hold office for one-year terms ending at the
Company's 1999 annual meeting of shareholders or until their successors are
elected and qualified. The Company's Board of Directors has nominated each of
the Company's current directors for re-election at the Annual Meeting. The
Board of Directors recommends that shareholders vote FOR each of the persons
nominated.
The Board of Directors believes that all of the nominees are willing to
serve as directors. However, if any nominee at the time of election is unable
to serve or is otherwise unavailable for election, and as a result other
nominees are designated by the Board of Directors, the persons named in the
enclosed proxy or their substitutes intend to vote for the election of such
designated nominees. The nine nominees receiving the greatest number of votes
will be elected as Directors at the meeting.
Nominees for Election
The nominee directors and their respective ages, year first elected to the
Board, positions and principal occupations are furnished below.
Year
First
Name Age Elected Position with Company
- ---- --- ------- ---------------------
Thomas K. Manning 56 1986 Chairman of the Board of Directors
and Chief Executive Officer
William L. Yager 50 1994 Director, President and
Chief Operating Officer
Jack J. Culberg 84 1986 Director
Todd Goodwin 67 1986 Director
John E. Grimm, III 76 1994 Director
Lanny R. Julian 55 1994 Director
Noel Thomas Patton 52 1995 Director
Beatrice B. Smith 57 1994 Director
Darrel M. Sanders 57 1994 Director, Senior Vice President
Operations
4
<PAGE>
Mr. Manning was named Chairman of the Board of Directors and Chief Executive
Officer effective June 30, 1996. He was President and Chief Executive Officer
from 1989 until 1996 and has been employed by the Company for over 20 years.
Mr. Yager was named President and Chief Operating Officer effective June 30,
1996. He was Senior Vice President-Finance and Administration of the Company
from February 1992 through June 1996 and has been employed by the Company since
1988.
Mr. Culberg is an independent investor. He was Chairman of the Board of
Directors from May 1988 through his resignation as Chairman on June 30, 1996.
Mr. Goodwin has been a partner in Gibbons, Goodwin, van Amerongen ("GGvA"),
a New York investment banking firm, for more than five years. Mr. Goodwin is
also a member of the Board of Directors of Johns Manville Corporation, Merrill
Lynch Institutional Funds and Wells Aluminum Corporation.
Mr. Grimm has been Chairman and Chief Executive Officer of Midbrook, Inc., a
New York business consulting firm, for more than ten years. Prior to that he
was a corporate Vice President of the Colgate Palmolive Company.
Mr. Julian is President of Donlan Marketing Group, L.L.C., a marketing
consulting company. He was previously President of Ambassador Cards, a division
of Hallmark Cards, Inc., a position which he held from 1992 through 1994.
Mr. Patton is an independent investor. He was the owner, Chairman and Chief
Executive Officer of Patton Electric Company for more than five years prior to
its acquisition by the Company in April 1995.
Ms. Smith has been Dean of the College of Human Environmental Sciences at
the University of Missouri in Columbia, Missouri for more than five years.
Mr. Sanders has been Senior Vice President-Operations of the Company since
1992. He has been employed by the Company for over 30 years.
Meetings of the Board of Directors and Committees
The Board of Directors conducts its business through meetings of the Board
and through activities of its committees and, when appropriate, by unanimous
written consent in lieu of meetings of the Board or its committees. The Board
of Directors met four times during the year ended June 30, 1998. The committees
of the Board are the Executive Committee, the Audit Committee and the
Compensation and Stock Option Committee (the "Compensation Committee").
5
<PAGE>
The Executive Committee may be empowered to take all actions of the full
Board of Directors at all times between regularly scheduled meetings of the
full Board. The Executive Committee consists of Jack J. Culberg, Todd Goodwin,
Thomas K. Manning and Beatrice B. Smith. The Committee did not meet during the
year ended June 30, 1998.
The Compensation Committee consists of Todd Goodwin, Chairman, John E.
Grimm, III, and Lanny R. Julian. This Committee administers the Company's Stock
Option Plans and determines the level of executive compensation, including
amounts to be allocated under the Company's incentive compensation plan for
executive officers and other key managers. The Compensation Committee met once
during the year ended June 30, 1998.
The Audit Committee periodically reviews the Company's auditing practices
and procedures and recommends independent auditors for selection by the full
Board of Directors. The Audit Committee consists of Lanny R. Julian, Noel
Thomas Patton and Beatrice B. Smith. This committee met once during the year
ended June 30, 1998.
The Company does not have a standing nominating committee of the Board or a
committee performing a similar function.
EXECUTIVE OFFICERS
Information regarding three of the Company's executive officers is included
under "Nominees for Election." An additional executive officer is W. Mark
Meierhoffer, age 50, the Company's Senior Vice President, Finance and
Administration. Prior to joining the Company in November 1996, Mr. Meierhoffer
was Senior Vice President and Chief Operating Officer of DeMarche Associates,
Inc., a national investment consulting firm, serving in such position from 1993
until 1996. Prior to 1993, Mr. Meierhoffer served in various capacities for
Marion Merrell Dow, Inc. including as Vice President and International
Treasurer.
PROPOSAL 2
ELECTION OF INDEPENDENT AUDITORS
The Company's independent auditors for fiscal 1998 were KPMG Peat Marwick,
independent certified public accountants. At the Annual Meeting, the
shareholders will consider and vote upon a proposal to ratify the appointment
of the independent auditors for the Company's fiscal year ending June 30, 1999.
The Audit Committee of the Board of Directors has recommended that KPMG Peat
Marwick be re-appointed as independent auditors for that year. The Board of
Directors unanimously recommends that shareholders vote FOR this proposal.
Representatives of KPMG Peat Marwick will be present at the Annual Meeting
to make a statement, if they wish, and to respond to appropriate questions from
shareholders.
EXECUTIVE COMPENSATION
Summary Compensation Table
The table below shows all plan and non-plan compensation awarded to, earned
by, or paid to the Company's Chief Executive Officer ("CEO") and its four most
highly compensated executive officers other than the CEO, for services rendered
to the Company and its subsidiaries during the periods indicated.
6
<PAGE>
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation(4)
------------------- ---------------
Stock All
Fiscal Options Other
Name and Title Year Salary Bonus Other(1) Granted(#) Compensation(5)
- -------------- ---- ------ ----- -------- ---------- ---------------
<S> <C> <C> <C> <c. <c. <C>
Thomas K. Manning............1998 $285,000 $ - $ 8,950 25,000 $37,256
Chairman of the Board 1997 270,000 28,337 11,948 25,000 48,346
of Directors and Chief 1996 270,000 128,253 9,989 30,000 43,213
Executive Officer
William L. Yager.............1998 200,000 - 6,540 15,000 26,715
President and Chief 1997 200,000 17,992 6,402 12,000 29,163
Operating Officer 1996 150,000 50,894 5,123 15,000 22,788
Darrel M. Sanders............1998 165,000 33,413 5,321 10,000 21,840
Sr. Vice President 1997 165,000 12,370 6,139 8,000 26,013
Operations 1996 150,000 50,894 5,123 10,000 22,788
W. Mark Meierhoffer..........1998 155,000 31,388 1,471 10,000 15,765
Sr. Vice President 1997 93,333 10,495 - 16,000 556
Finance and Administration 1996 - - - - -
Neal Bastick (3).............1998 112,816 28,800 - 4,000 10,518
Vice President 1997 109,529 20,246 - 4,000 0
International Sales 1996 - - - - -
William S. Endres (2)........1998 165,000 - - - 45,765
Former Sr. Vice President 1997 165,000 12,370 6,139 8,000 26,013
Sales and Marketing 1996 150,000 50,894 5,123 10,000 22,788
<FN>
1)Other Annual Compensation consists solely of cash payments made in March of
each year to reimburse participants in the Company's Secular Trust Plan for a
portion of the income tax liabilities incurred as a result of participating in
this non-qualified retirement plan.
2)Mr. Endres resigned his position as Director and Senior Vice President of
Sales and Marketing in November 1997. The Company continues to pay Mr. Endres
his base salary for one year following termination under the terms of his
employment agreement.
3)Mr. Bastick's compensation is paid in Netherland Guilders. For purposes of
the presentation herein, the Guilders have been converted to U.S. dollars at
the June 30, 1998 exchange rate of .4905.
4)Stock options are the only form of Long Term Compensation currently provided
by the Company.
5)The majority of All Other Compensation for the executive officers represents
the Company's contributions to the Secular Trust Plan. The Secular Trust Plan
was designed to replace benefits under the Company's defined benefit pension
plan which are no longer available to the executive officers and certain other
managers. Contributions to the Secular Trust Plan for fiscal 1998 were as
follows: Mr. Manning, $36,700; Mr. Yager, $26,159; Mr. Sanders, $21,284; and
Mr. Meierhoffer, $15,209. Mr. Bastick's non-cash compensation included $10,518
under a defined contribution pension plan for the Company's European managers.
Mr. Endres' non-cash compensation included $16,334 under the Secular Trust Plan
and $28,875 for a company vehicle that was transferred to him upon his
resignation. The balance of the All Other Compensation represents the Company's
payments for term life insurance and the Company's 401(K) matching
contributions made on behalf of the executive officers.
</TABLE>
7
<PAGE>
Stock Option Grants in Fiscal 1998
The following table provides information concerning stock options granted
during the year ended June 30, 1998 to the named executive officers.
<TABLE>
<CAPTION>
Individual Grants
-----------------
Number of
Securities % of Total Potential Realizable Value at
Underlying Options Assumed Annual Rates of Stock
Options Granted to Exercise Price Appreciation for Option
Granted Employees in Price Expiration Term (2)
Name #(l) Fiscal Year $/Share Date 5% 10%
- ----------------- ------ ----- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Thomas K. Manning 25,000 14.1% $15.625 5/12/08 $245,662 $622,556
William L. Yager 15,000 8.5 15.625 5/12/08 147,397 373,533
Darrel M. Sanders 10,000 5.6 15.625 5/12/08 98,265 249,022
W. Mark Meierhoffer 10,000 5.6 15.625 5/12/08 98,265 249,022
Neal Bastick 4,000 2.3 15.625 5/12/08 39,306 99,609
<FN>
1) The exercise price of each option was 100% of the fair market value of the
Common Stock at the close of business on the date of grant. At the end of each
year following the date of grant, 25% of the options become exercisable, with
accumulation privileges.
2) These dollar amounts represent a hypothetical increase in the price of the
Common Stock from the date the referenced options were granted until their
expiration date at the rate of 5% and 10% per annum compounded.
</TABLE>
Aggregated Option Exercises in Fiscal 1998 and 6/30/98 Option Values
The table below provides information concerning stock options exercised
during the year ended June 30, 1998, by the named executive officers and the
number and value of unexercised options held by them as of June 30, 1998.
<TABLE>
CAPTION>
Number of Value of Unexercised
Options Exercised Unexercised In-the-Money
------------------ Options at 6/30/98 Options at 6/30/98
Shares Value -------------------------- --------------------------
Name Acquired Realized Exercisable Unexercisable Exercisable Unexercisable
- ------------------- ------------------ -------------------------- --------------------------
<S> <C> <C> <C> <C> <C> <C>
Thomas K. Manning 0 0 162,414 66,250 $633,419 $ 0
William L. Yager 0 0 81,040 34,000 522,490 0
Darrel M. Sanders 0 0 41,500 23,500 42,750 0
W. Mark Meierhoffer 0 0 4,000 22,000 0 0
Neal Bastick 0 0 2,000 8,000 0 0
William S. Endres 27,540 $159,413 0 0 0 0
</TABLE>
8
<PAGE>
Retirement Plan
During the year ended June 30, 1990, the accrued benefits under the
Company's defined benefit pension plan of certain individuals defined under the
Internal Revenue Code as "highly compensated," including all of the executive
officers employed by the Company, were vested and frozen at their accrued
benefit levels. Certain executive officers will receive retirement benefits
under the Company's retirement plan as a result of accrued benefits available
to such officers at the time their benefits were frozen. At regular retirement
age, monthly benefits will be available as follows: Mr. Manning ($3,410), Mr.
Endres ($1,405) and Mr. Sanders ($1,944).
Employment Agreements
The Company has entered into Employment Agreements ("Agreements") with
Messrs. Manning, Yager, Meierhoffer and Sanders. Each of the Agreements provide
for severance pay equal to the executive's annual base salary in the event that
the executive is discharged by the Company, other than for just cause (as
defined in the Agreements). Additionally, the executive will receive severance
equal to the executive's annual base salary if after a change of control (as
defined in the Agreements), the executive terminates his employment with thirty
days written notice to the Company within six months after he has been assigned
services and responsibilities which are not substantially commensurate with the
services and responsibilities which he was performing immediately prior to the
change of control. Mr. Endres had a similar employment agreement.
Director Compensation
Members of the Board of Directors, other than executive officers of the
Company, receive fees of $5,000 per quarter for serving on the Board. In
addition to the cash compensation, at each annual shareholders' meeting
commencing with the 1995 meeting, each Outside Director elected to serve at
such annual meeting receives a grant of a nonqualified stock option to purchase
1,000 shares, effective as of the date of the meeting, at an exercise price
equal to the fair market value of the shares on the date of grant, and which
shall become exercisable in four equal annual installments.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee currently consists of Todd Goodwin, Chairman,
John E. Grimm, III and Lanny R. Julian. There are no compensation committee
interlocks involving these individuals.
9
<PAGE>
Compensation Committee Report on Executive Compensation
It is the Company's policy that executive officers receive total
compensation designed to attract, retain, and motivate high performance
managers that is appropriate in light of the Company's performance and the
interests of shareholders. Total executive compensation (base salary, bonus and
stock options) for the executive officers is based upon the Company's operating
performance as compared to the Company's strategic plan.
Base Salary
The Company believes that its executives' salaries have generally been set
at conservative levels when compared with salaries paid by other companies of
comparable size to executives with similar skills. The base salaries are set at
approximately the 25th percentile of salaries for similar positions based upon
a survey of all industrial companies by a nationally recognized independent
consulting organization. The Compensation Committee annually reviews the
executive officers' salaries and, if warranted, approves changes. This review
takes into consideration the Company's performance over the preceding year,
each executive's individual performance and contribution, Committee approved
merit increase guidelines, compensation levels at comparable companies and
other factors.
Bonuses
Each year, under the Management Incentive Bonus Plan, the Committee
establishes goals relating to the Company's operating results and establishes
the minimum and maximum bonus pools that may be earned. No bonus is paid to the
Chief Executive Officer or the President if a minimum level of budgeted
operating results are not achieved. The incentive pool is established under a
formula that weights several factors including operating income, net sales and
working capital management. A majority of the incentive pool generated by
reaching the target is distributed in cash ratably to designated executive
officers and managers at year-end based on a weighing of positions and base
salaries. The remaining portion of the incentive pool is distributed to
outstanding performers within the eligible group based on the recommendation of
the CEO to the Committee. The targeted and maximum bonuses payable to executive
officers represent a significant portion of an executive's total compensation
(25-30% of the total compensation derived from a combination of base salary,
bonus and stock options).
Stock Options
Stock option grants are intended to provide long-term incentives for the
achievement of the Company's strategic business plan and to tie the interests
of the executive officers directly to the performance of the Company's Common
Stock. Under the Company's stock option plans, the Committee may award stock
options related to the individual's level of responsibility within the
organization that are designed to represent 25-30% of the executive officer's
total compensation. Only through maximizing shareholder wealth will the
Company's executive officers and other managers receive full potential of this
important part of their compensation package.
Total Compensation
The total compensation package consisting of base salary, bonus and stock
options can fluctuate significantly based upon Company performance. If the
Company meets its long term objectives which generally include average annual
stock price and earnings growth of 15%, then it is contemplated that the
executives' total compensation package would be at approximately the 75th
percentile of compensation packages for all other industrial companies.
10
<PAGE>
Committee's Bases for the CEO's Compensation
Mr. Manning was the Chief Executive Officer throughout fiscal 1998. His
compensation, like that of the other executive officers of the Company, is set
in accordance with the aforementioned policies. In fiscal 1998, operating
income and net earnings were below plan. As a result, Mr. Manning received no
bonus for fiscal 1998 and his cash compensation declined as compared to the
previous year.
The issuance of additional stock options to Mr. Manning in fiscal 1998 are
intended to provide incentives for continued focus on maximizing long-term
shareholder wealth.
Deductibility Cap on Compensation Exceeding $1,000,000
The Committee does not believe that Internal Revenue Service regulations
regarding non-deductibility of annual compensation in excess of $1,000,000 will
have any material impact upon the Company, given the current salary and bonus
levels of officers of the Company, and given the treatment in the regulations
of compensation under the Company's stock option plans.
Submitted by the Compensation and Stock Option Committee:
Todd Goodwin, Chairman
John E. Grimm, III
Lanny R. Julian
11
<PAGE>
Performance Graph
The following line graph compares the cumulative total return to
shareholders of the Company's Common Stock to the Total Return Index for the
Nasdaq Stock Market and a peer group index of eight stocks from June 30,1993
through June 30, 1998. The graph assumes $100 invested at June 30, 1993 and
reinvestment of dividends.
The Peer Group consists of Black & Decker, General Housewares, Helen of Troy
Corp., National Presto Industries, Inc., Royal Appliance Mfg. Co., Toastmaster,
Inc. and Windmere Corporation.
(PERFORMANCE GRAPHIC)
Value of $100 invested on June 30, 1993 with Dividends Reinvested *
6/30/93 6/30/94 6/30/95 6/30/96 6/30/97 6/30/98
---------------------------------------------------------
The Rival Company 100 145 105 165 107 100
Nasdaq Stock Market 100 101 135 173 210 278
Peer Group 100 85 127 161 171 253
* $100 invested on 6/30/93 in stock or in index - including reinvestment of
dividends. Fiscal year ending June 30.
12
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial ownership of
the Company's Common Stock by all present directors and the named executive
officers. The table also sets forth the number of shares beneficially owned and
the percentage of ownership of the Company's Common Stock by all directors and
executive officers as a group and by each person who was known by the Company
to own beneficially as much as five percent of the total outstanding shares of
the Company's Common Stock as of the dates indicated. The table reports
ownership as of August 25, 1998, except for Neuberger & Berman LLC, Franklin
Templeton Group and Pioneering Management Corporation for which the Company
relied on Forms 13(f) filed as of June 30, 1998.
Amount and Nature
of Beneficial
Shareholder Ownership(1) Percent Owned(11)
- -------------------------------------------------------------------------------
5% Shareholders:
T. Rowe Price (2) 1,132,000 11.5%
Pioneering Management Corporation (3) 924,000 9.4
Franklin Templeton Group (4) 870,400 8.8
Neuberger & Berman LLC (5) 713,900 7.2
Royce & Associates, Inc. (6) 474,600 4.8
Directors and Named Executive Officers:
Thomas K. Manning (7) 261,977 2.7
William L. Yager (8) 88,840 .9
Darrel M. Sanders 67,554 .7
Jack J. Culberg 35,650 .4
Todd Goodwin (9) 57,988 .6
John E. Grimm, III 3,800 *
Lanny R. Julian 2,700 *
Noel Thomas Patton (10) 851,500 8.6
Beatrice Smith 2,700 *
W. Mark Meierhoffer 6,000 *
Neal Bastick 2,000 *
All Directors and Executive
Officers as a Group 1,380,709 14.0
(1) The shares beneficially owned as scheduled above include those shares the
following persons have the right to acquire within sixty days from August
25, 1998 by way of option exercise: Mr. Manning - 162,414; Mr. Yager -
81,040; Mr. Sanders - 41,500; Mr. Meierhoffer - 4,000; Mr. Bastick -
2,000; Mr. Culberg - 750; Mr. Goodwin - 750; Mr. Grimm - 1,500; Mr.
Julian - 1,500; Mr. Patton - 1,500; and Ms. Smith - 1,500. Out-of-the-
money options are included in the shares presented as beneficially owned
to the extent they are exercisable within 60 days of August 25, 1998.
(2) T. Rowe Price Associates, Inc. (100 East Pratt Street, Baltimore, MD)
("Price Associates") is a registered investment advisor, which has sole
investment power with respect to the shares indicated and sole voting
power with respect to 116,200 shares. These securities are owned by
various individual and institutional investors for which Price Associates
serves as investment adviser with power to direct investments and/or sole
power to vote the securities. For purposes of the reporting requirements
of the Securities Exchange Act of 1934, Price Associates is deemed to be
a beneficial owner of such securities; however, Price Associates
expressly disclaims that it is, in fact, the beneficial owner of such
securities.
(3) Pioneering Management Corporation (60 State Street, Boston, MA) is a
registered investment advisor, which has sole investment power and sole
voting power over all of the shares indicated.
(4) Franklin Templeton Group (777 Mariners Island Blvd., San Marco, CA) is a
registered investment advisor, which has sole investment power and sole
voting power over all of the shares indicated.
13
<PAGE>
(5) Neuberger & Berman LLC (605 Third Avenue, New York, NY) ("N&B") is a
registered investment advisor. In its capacity as investment advisor, N&B
may have discretionary authority to dispose of or to vote shares that are
under its management. As a result, N&B may be deemed to have beneficial
ownership of such shares. N&B does not, however, have any economic
interest in the shares. As of June 30, 1998, of the shares set forth
above, N&B had shared investment power on 231,900 shares and sole voting
power with respect to 482,000 shares. With regard to the shared voting
power, Neuberger & Berman Management, Inc. and Neuberger & Berman Funds
are deemed to be beneficial owners for purpose of Rule 13(d) since they
have shared power to make decisions whether to retain or dispose of the
securities. N&B is the sub-advisor to the above referenced Funds.
(6) Royce & Associates, Inc. (1414 Avenue of the Americas, New York, NY) is a
registered investment advisor, which has sole investment power and sole
voting power over all of the shares indicated.
(7) Includes 30,000 shares held by Mr. Manning's spouse. Mr. Manning shares
voting and investment power with respect to these shares.
(8) Includes 1,800 shares held by members of Mr. Yager's family. Mr. Yager
shares voting and investment power with respect to these shares.
(9) Includes 3,000 shares held by Mr. Goodwin's spouse as to which he
disclaims beneficial ownership.
(10) Includes 843,948 shares held by a corporation in which Mr. Patton and
his spouse each have a 50% ownership interest.
(11) For purposes of determining this percentage, the outstanding shares of
the Company include shares which such persons have the right to acquire
within sixty days by way of option exercise.
FINANCIAL DATA
The Company's Annual Report containing financial statements of the Company
for the year ended June 30, 1998, has been enclosed in the same mailing with
this Proxy Statement. The Annual Report is not incorporated in this Proxy
Statement and is not deemed a part of the proxy soliciting material.
OTHER MATTERS
The Board of Directors knows of no other matters which will be presented for
consideration at the Annual Meeting. Other matters may be properly brought
before the Annual Meeting by or at the discretion of the Board of Directors, or
by shareholders who are entitled to vote at the meeting and who comply with the
notice procedures set forth in Section 13 of the Company's By-laws (see
"Shareholder Proposals" below). If any other matter is properly brought before
the meeting by or at the discretion of the Board of Directors, the persons
named in the proxy will vote the shares represented thereby in accordance with
their judgment.
In addition to the solicitation of proxies from shareholders by use of the
mails, proxies may be solicited by the Company's directors, officers and other
employees, by personal interview, telephone or telegram. Such persons will
receive no additional compensation for their services. The Company requests
that brokerage houses and other custodians, nominees and fiduciaries forward
the soliciting material to the beneficial owners of the shares of Company
Common Stock held of record by such persons and will pay such brokers and other
fiduciaries their reasonable out-of-pocket expenses incurred in connection
therewith. All costs of solicitation, including the costs of preparing,
assembling and mailing this Proxy Statement and all papers which now accompany
or may hereafter supplement the same, will be borne by the Company.
14
<PAGE>
SHAREHOLDER PROPOSALS
Shareholder nominations of candidates for election as directors or other
shareholder proposals may be brought before the 1998 Annual Meeting of
Shareholders only by shareholders entitled to vote at the meeting who give
timely notice thereof in compliance with Section 13 of the Company's By-laws,
which notice must be delivered to the Company not less than 10 days following
the mailing date of this Proxy Statement.
Shareholder proposals may be brought before the 1999 Annual Meeting of
Shareholders only by shareholders entitled to vote at such meeting who give
timely written notice thereof in compliance with Section 13 of the By-laws,
which notice must be delivered to the Company (a) not less than 60 days prior
to the date of the meeting, or (b) if the Company does not provide at least 70
days' prior notice or public announcement of the date of the meeting, such
shareholder notice must be delivered to the Company not more than 10 days
following the Company's mailing date of the notice or public announcement of
the date of the meeting, whichever is earlier. To be considered for inclusion
in the proxy statement and proxy for the 1999 Annual Meeting of Shareholders,
any shareholder proposal meeting the foregoing requirements must be received at
the Company's corporate office by May 24, 1999.
By order of the Board of Directors
Stanley D. Biggs
Secretary
15
<PAGE>
This page left blank intentionally.
16
<PAGE>
