<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. ___)
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12.
RUSHMORE FINANCIAL GROUP, INC.
(Name of Registrant as Specified in Its Charter)
-----------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction applies:
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<PAGE> 2
(2) Aggregate number of securities to which transactions applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total Fee paid:
- ------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0- 11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- -----------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- -----------------------------------------------------------------
(3) Filing party:
- -----------------------------------------------------------------
(4) Date filed:
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<PAGE> 3
RUSHMORE FINANCIAL GROUP, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of
RUSHMORE FINANCIAL GROUP, INC. (the "Company") will be held on Friday, July 17,
1998 at 3:00 p.m., local time, at The Westin Hotel Galleria, located at 13340
Dallas Parkway, 21st Floor, Panorama Room, Dallas, Texas, for the following
purposes:
(1) To elect a class of three members of the Board of
Directors to serve until the 2001 annual meeting of shareholders or
until their respective successors are duly elected and qualified;
(2) To ratify the appointment of KPMG Peat Marwick LLP as the
Company's auditors; and
(3) To consider and act upon any other matters which may
properly come before the meeting or any adjournment thereof.
The holders of record of Common Stock at the close of business on June
19, 1998 will be entitled to vote at the meeting.
For a period of at least ten days prior to the meeting, a complete list
of shareholders entitled to vote at the meeting will be open to the examination
of any stockholder during ordinary business hours at the Company's offices at
13355 Noel Road, Suite 650, Dallas, Texas 75240.
By order of the Board of Directors
D.M. (Rusty) Moore, Jr.
President and Chief Executive Officer
June 26, 1998
--------------------------
You are cordially invited to attend the meeting in person. Even if you
plan to be present, please sign, date and mail the enclosed proxy promptly. Even
if you attend the meeting, you may vote in person or by your proxy.
<PAGE> 4
RUSHMORE FINANCIAL GROUP, INC.
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
JULY 17, 1998
This proxy statement is furnished in connection with a solicitation of
proxies by the Board of Directors of Rushmore Financial Group, Inc. (the
"Company"). The proxies solicited in connection with this proxy statement will
be used at the annual meeting of shareholders of the Company to be held on
Friday, July 17, 1998 at 3:00 p.m., local time, at The Westin Hotel Galleria,
located at 13340 Dallas Parkway, 21st Floor, Panorama Room, Dallas, Texas 75240,
and at any adjournment thereof, for the purposes set forth in the foregoing
notice of the meeting. Properly executed proxies received in time for the
meeting will be voted as specified therein. If either of the enclosed forms of
proxy is executed and returned, it may nevertheless be revoked by written notice
to either of the persons named as a proxy or the Secretary of the Company at any
time before it is exercised, by voting in person at the meeting or by giving a
later proxy. This proxy statement and the enclosed forms of proxy are being
mailed on or about June 26, 1998.
The Company's principal executive office is located at 13355 Noel Road,
Suite 650, Dallas, Texas 75240, and its telephone number is (972) 450-6000.
At the close of business on June 19, 1998 (the "Record Date"), the
Company had outstanding and entitled to vote 2,984,617 shares of Common Stock,
$.01 par value (the "Common Stock"). The holders of record of such shares on
such date will be entitled to one vote at the annual meeting for each share held
by them. The presence, in person or by proxy, of a majority of the outstanding
shares of Common Stock entitled to vote at the annual meeting will constitute a
quorum for the vote of Common Stock.
The Annual Report to shareholders for the year ended December 31, 1997,
including financial statements, is enclosed with this proxy statement.
MATTERS TO BE ACTED UPON
As of the date of this proxy statement, the Board of Directors of the
Company knows of no other matters other than Proposal 1 and Proposal 2,
described below, which are likely to be presented for consideration at the
annual meeting. However, if any other matters should properly come before the
meeting or any adjournment thereof, the persons named in the enclosed proxy will
have discretionary authority to vote such proxy in accordance with their best
judgment on such matters and with respect to matters incident to the conduct of
the meeting. Votes will be counted at the meeting by an election judge to be
appointed by the Company prior to the meeting. An
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<PAGE> 5
abstention or non vote on a matter will not be counted for purposes of
determining whether the required vote necessary to approve such matter was
received.
PROPOSAL 1 - ELECTION OF DIRECTORS
At the annual meeting, the holders of Common Stock will be asked to
consider and act upon a resolution to elect a class of three members of the
Board of Directors. Directors will be elected by a plurality of votes.
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS
At the annual meeting, the holders of Common Stock will be asked to
ratify the Board of Directors appointment of KPMG Peat Marwick LLP as the
Company's independent auditors for the year ending December 31, 1998. The
affirmative vote, either in person or by proxy, of the holders of more than 50%
of the shares of Common Stock outstanding as of the Record Date, and that voted
for or against or expressly abstained, is necessary to ratify such appointment.
Accordingly, if a shareholder abstains from voting certain shares on the
ratification, or a beneficial owner fails to deliver written instructions to his
nominee holder of shares so that the nominee holder is not able to vote such
shares, it will have the effect of a negative vote.
PROPOSAL 1
ELECTION OF DIRECTORS
At the meeting, a class of three directors is to be elected to hold
office until the 2001 annual meeting of shareholders or until their successors
are elected and qualified. The Company's Articles of Incorporation and Bylaws
provide that the Board of Directors shall be divided into three classes, equal
or approximately equal in number, serving staggered three year terms, and that
the number of directors constituting the Board of Directors shall be not less
than three nor more than twenty-one, as established by resolution of the Board
of Directors or by the vote of holders of at least 66 2/3% of the Common Stock.
The Board of Directors is now comprised of nine members, as fixed by the Board
of Directors, with each class consisting of three members.
Proxies may not be voted for a greater number of persons than the
number of nominees named in this proxy statement. It is the intention of the
persons named in the enclosed form of proxy to vote such proxies FOR the
election of the nominees named below unless authorization is withheld on the
proxy. Management does not contemplate that any nominee will be unable or
unwilling to serve as a director or become unavailable for any reason, but if
such should occur before the meeting, a proxy voted for any such individual will
be voted for another nominee to be selected by management.
The enclosed form of proxy provides a means for holders of Common Stock
to vote for all of the nominees listed therein, to withhold authority to vote
for one or more of such nominees or to withhold authority to vote for all such
nominees. Each properly executed proxy received in time for the meeting will be
voted as specified therein. If a holder of Common Stock does not specify
otherwise, the shares represented by such shareholder's proxy will be voted for
the nominees listed therein or, as noted above, for other nominees selected by
management. The withholding of authority or abstention will have no effect upon
the election of directors by holders of Common Stock because under Texas law
directors are elected by a plurality of the votes cast, assuming a quorum is
present. The presence of a majority of the outstanding shares of Common Stock
will constitute a quorum, and the shares held by each holder of Common Stock who
signs and returns the enclosed form of proxy will be counted for purposes of
determining the presence of a quorum at the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE THREE NOMINEES TO THE
BOARD OF DIRECTORS IDENTIFIED BELOW.
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<PAGE> 6
MANAGEMENT
DIRECTORS, DIRECTOR NOMINEES AND EXECUTIVE OFFICERS
The following table provides information as of June 1, 1998, with
respect to each of the Company's directors continuing in office, nominees for
director and executive officers, and certain key employees of the Company:
<TABLE>
<CAPTION>
Served as Executive
Officer, Director or
Name Age Position Key Employee Since
---- --- --------- ---------------------
<S> <C> <C> <C>
DIRECTOR NOMINEES
CLASS OF NOMINEES FOR TERMS EXPIRING IN 2001
Frederick E. (Fritz) Mowery(1) 42 Director and President 1996
of Rushmore Advisors
William C. Keane(4) 68 Director
Charles M. Duke, Jr. 62 Director
DIRECTORS CONTINUING IN OFFICE
CLASS OF DIRECTORS WITH TERMS EXPIRING IN 1999
D.M. (Rusty) Moore, Jr.(1) 48 Director (Chairman), 1990
President and Chief
Executive Officer
Timothy J. Gardiner 43 Director 1997
James M. Fehleison(2)(3) 39 Director 1998
CLASS OF DIRECTORS WITH TERMS EXPIRING IN 2000
James W. Clark(1) 46 Director, Secretary and 1991
President of Rushmore
Securities
Mark S. Adler 44 Director 1997
Gayle C. Tinsley(2)(3) 67 Director 1998
OTHER EXECUTIVE OFFICERS
Robert W. Hendren 44 Chief Financial Officer 1998
KEY EMPLOYEES
Christine E. Miller 60 Vice President of 1992
Administration
</TABLE>
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<PAGE> 7
<TABLE>
<S> <C> <C> <C>
Howard M. Stein 49 Controller 1995
G.A. (Chip) Brunott, Jr. 48 President of Rushmore 1996
Agency
Thomas G. Coleman, Jr. 35 Vice President of 1994
Rushmore Securities
Benjamin H. Dean 34 Director of RushMAP 1996
Richard C. Lee 32 Director of Career Partners 1997
Division
</TABLE>
- ------------------------
(1) Member of Executive Committee.
(2) Member of Audit Committee.
(3) Member of Compensation Committee.
(4) If elected, Mr. Keane will also be appointed a member of the Audit
Committee and Compensation Committee.
Frederick E. (Fritz) Mowery has been President of Rushmore Investment
Advisors, Inc., a wholly owned subsidiary of the Company ("Rushmore Advisors"),
since January 1996. From November 1990 to September 1995, he was a senior
portfolio manager with Comerica Bank-Texas, and from September 1995 to January
1996, he was President of Guardian Financial Management. He is a certified
financial planner.
William C. Keane will become a director if elected at the annual
meeting. He is currently retired, but has over 20 years experience in insurance
and securities, serving as President of A.L. Williams Corp. and A.L. Williams
Life Insurance Company for eight years, Vice President and General Manager of
Massachusetts Indemnity Life, a subsidiary of Penn Corp. Financial, Inc., for
approximately two years and as Senior Vice President for over ten years for
National Home Life Assurance Company, a subsidiary of National Liberty Corp.
Charles M. Duke, Jr. will become a director upon his election at the
annual meeting. Mr. Duke is a former astronaut who piloted the lunar module on
the Apollo 16 mission on April 16-27, 1972. For the past sixteen years, he has
been engaged in personal investments. Also, he has been the President of Charlie
Duke Enterprises, Inc., a video productions and sales company, since January
1989.
D.M. (Rusty) Moore, Jr., is the founder and has been President of the
Company since its formation in 1990. Prior to that he was a senior vice
president and national sales director of a large insurance and securities
marketing organization.
Timothy J. Gardiner has been a director of the Company since April
1997. He has been a regional director of Managed Economics for Doctors, Inc.
since 1991, a company engaged in financial planning to members of the medical
profession.
James M. Fehleison has been a director of the Company since April 1998.
He is currently the Chief Financial Officer of First Southwest Holdings, Inc.,
the parent of First Southwest Company, an investment banking firm in Dallas,
Texas. From 1995 to 1997, he was Chief Financial Officer of the corporate
services division of Fidelity Investments. From 1985 to 1995, he was Senior Vice
President and Controller of Rauscher Pierce Refsnes, Inc. He is a certified
public accountant.
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<PAGE> 8
James W. Clark has been President of Rushmore Securities Corporation, a
wholly owned subsidiary of the Company ("Rushmore Securities"), since 1991 and
Secretary of the Company since 1993 and a director since 1991. He is a general
securities registered principal and financial operations principal and
supervises all registered representatives and branch office operations.
Mark S. Adler has been a director of the Company since April 1997 and a
director of Rushmore Life Insurance Company, a wholly owned subsidiary of the
Company ("Rushmore Life"), since 1996. He has served since 1984 as President and
a co-founder of A&R Financial and Insurance Services, Inc., a company that
markets insurance and investment services to Public Safety Unions throughout
California.
Gayle C. Tinsley has been a director of the Company since April 1998.
He has served as a consultant to small businesses since 1988 in the areas of
business and marketing plan development and capital funding. Prior to 1988, he
was Vice President of Sales, Marketing and Technical Services of VMX
Corporation, and is a former President and Chief Executive Officer of
Docutel/Olivetti Corporation. Mr. Tinsley has held management positions with
Xerox Corporation, Recognition Equipment, Inc. and IBM Corporation.
Robert W. Hendren began serving as Chief Financial Officer of the
Company in January 1998. Prior to that he served from October 1997 to January
1998 as an examiner for the Oklahoma Department of Insurance, from June 1997 to
October 1998 as Chief Financial Officer of United Benefit Managed Care Corp. and
from September 1985 to June 1997 as Chief Financial Officer of National Health
Insurance Corporation. Mr. Hendren is a certified public accountant and a Fellow
of the Life Management Institute.
Christine E. Miller has served as Vice President of Administration of
the Company since February 1992 and has been employed by the Company since its
inception.
Howard M. Stein has served as Controller of the Company since February
1995 and was Chief Financial Officer until January 1998. Prior to joining the
Company, from 1987 until 1992 he was a Controller for First Gibraltar Bank and
from 1992 to 1994 he was Controller and Chief Financial Officer of FTS Life
Insurance Agency, Inc. He is a certified public accountant in the State of
Texas.
G.A. (Chip) Brunott, Jr. has served as President of Rushmore Insurance
Services, Inc., an affiliate of the Company ("Rushmore Agency"), since January
1996 and as director of marketing from 1993 to 1996. He has a background in
retail sales, small business management and church and ministry organization.
Thomas G. Coleman, Jr. has served as Vice President of Rushmore
Securities in charge of its discount brokerage division since February 1994.
From 1998 to 1994 he was a registered representative with Ellsworth Investments,
Inc. Mr. Coleman is a certified public accountant.
Benjamin H. Dean has served as director of Rushmore Managed Asset
Program ("RushMAP"), a proprietary asset allocation program operated by Rushmore
Advisors, since July 1996. From November 1992 until May 1996, he was manager of
advisory services for 1st Global Capital Corp. Mr. Dean is a certified financial
planner.
Richard C. Lee has served as director of Rushmore Agency's Career
Partners Division since April 1997. Prior to that, he served as President of ASA
Promotions from 1989 to 1996, a specialty advertising and promotions firm for
the telecommunications industry.
Harlan T. (Tra) Cardwell, III has served as a director of the Company
since April 1997, but his term will expire at the annual meeting. He formerly
served as a loan officer for Herring Bank. He is also a director of the
Company's annuity division and is a certified financial planner.
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<PAGE> 9
COMMITTEES OF DIRECTORS
The Board of Directors has the following committees:
COMMITTEE MEMBERS
Executive . . . . . . . . . . . D.M. (Rusty) Moore, Jr. - Chairman
James W. Clark
Frederick E. (Fritz) Mowery
Audit . . . . . . . . . . . . . James M. Fehleison - Chairman
Gayle C. Tinsley
William C. Keane
Compensation. . . . . . . . . . Gayle C. Tinsley - Chairman
James M. Fehleison
William C. Keane
The Executive Committee conducts the normal business operations of the
Company except for certain matters reserved to the Board of Directors. The Audit
Committee recommends an independent auditor for the Company, consults with such
independent auditor and reviews the Company's financial statements. The
Compensation Committee recommends to the Board of Directors the compensation of
officers and key employees for the Company and the granting of stock options.
Messrs. Fehleison, Tinsley and Keane are considered to be independent directors
for these and other purposes. The Company does not have a nominating committee
or any committee performing similar functions.
The Board of Directors held four meetings in 1997, the Executive
Committee held one meeting in 1997, and the Compensation Committee held one
meeting during 1997. The Audit Committee held no meetings in 1997.
COMPENSATION OF DIRECTORS
The Company pays each non-employee director a fee of $2,500 per year,
plus a meeting fee of $250 for each Board meeting attended, and automatically
grants to each director non-qualified stock options for 2,500 shares of Common
Stock per year.
CERTAIN TRANSACTIONS
The Company believes that all of the transactions set forth below,
which were approved by the full Board of Directors of the Company, which
included independent directors, were made on terms no less favorable to the
Company than could have been obtained from unaffiliated third parties. All
future transactions, including loans, between the Company and its officers,
directors, principal shareholders and affiliates, will be approved by a majority
of the Board of Directors, including a majority of the independent and
disinterested outside directors, and will be on terms no less favorable to the
Company than could be obtained from unaffiliated third parties.
D. M. (Rusty) Moore, Jr., the Company's President and Chief Executive
Officer, owns 100% of Rushmore Agency, due to provisions of the Texas Insurance
Code that prohibit ownership of life insurance agencies by corporations.
Pursuant to an Overhead Services Agreement between Mr. Moore and the Company,
all activities of the agency are administered by the Company, and all revenues
and expenses of the agency are passed through to the Company. Mr. Moore has also
granted the Company an irrevocable option for the Company to appoint any other
qualified person to acquire Rushmore Agency on its behalf.
As of December 31, 1997, Mr. Moore was the 100% owner of a company
known as Rushmore Realty Advisors, Inc., which is a licensed real estate agent
in Texas ("Rushmore Realty"). Rushmore Realty acted as the real estate agent
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<PAGE> 10
for the Company in negotiating two new office leases during 1997, and received
commissions of $27,693 that were paid by the landlord and sublessor. In April
1998, Rushmore Realty was acquired by the Company for nominal consideration.
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid by the Company for
services rendered during the fiscal years ended December 31, 1997 and 1996, and
the number of options granted, to the Chief Executive Officer of the Company and
each other executive officer of the Company whose total cash compensation for
the fiscal year ended December 31, 1997 exceeded $100,000:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Annual Compensation-
Name and Compensation Securities
Principal ---------------------------------------- Underlying
Position Year Salary Bonus Other Options or Warrants
--------- ---- ------ ----- ----- -------------------
<S> <C> <C> <C> <C> <C>
D.M. (Rusty) Moore, Jr. 1997 $ 79,023 $ - $ 74,365 7,083
Chief Executive Officer 1996 60,000(1) - 114,124 -
James W. Clark. 1997 9,863 - 128,532 6,458
President, Rushmore 1996 9,678 - 79,732 -
Securities Corporation
</TABLE>
- --------------------------
(1) Only $3,602 of such amount was paid at the election of Mr. Moore.
(2) Constitutes commissions paid for sales of securities and insurance.
OPTION/SAR GRANT TABLE
(OPTION/WARRANT/SAR GRANTS IN LAST FISCAL YEAR)
<TABLE>
<CAPTION>
Number of
Securities Percent of
Underlying Total
Options or Option/Warrant Market Price
Warrants Granted to Exercise or on Date
Granted Employees in Base Price of Grant Expiration
Name # Fiscal Year ($/Sh) ($/Sh) Date
---- ----------- ------------ ------------- ------------- ----------
<S> <C> <C> <C> <C> <C>
D. M. (Rusty) 5,833 10.7% $1.50 $1.50(1) 3/1/2004
Moore, Jr. 1,250 2.3% 1.92 1.92(2) 4/1/2007
James W. Clark 5,833 10.7% $1.50 $1.50 3/1/2004
625 1.2% 1.92 1.92 4/1/2007
</TABLE>
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<PAGE> 11
- ------------------------
(1) There was no market for the Common Stock on the date of grant, and the
market price as of such date was determined by the Board of Directors.
(2) There was no market for Common Stock on the date of the grant, and the
market price as of such date was determined by appraisal.
AGGREGATED OPTION/WARRANT/SAR EXERCISES IN LAST FISCAL
YEAR AND FY-END OPTION/WARRANT/SAR VALUES
<TABLE>
<CAPTION>
Value of
Unexercised
Shares Number of Securities In-the-Money
Acquired Underlying Unexercised Options/Warrants/
on Value Options/Warrants/SARs SARs at 1997
Exercise Realized at 1997 FY-End(1) FY-End
Name # $ # $
---- --- --- --- --
<S> <C> <C> <C> <C>
D. M. (Rusty) 13,260 -(1) 23,823 $ -(2)
Moore, Jr.
James W. Clark -0- - 36,458 -(2)
</TABLE>
- -----------------------
(1) The options were exercised on April 16, 1997. On such date, there was
no market for the Common Stock, and the difference between the fair
market value and the exercise price was not readily ascertainable.
However, based on the $5.50 offering price of the Common Stock pursuant
to the Company's initial public offering on February 17, 1998, the
value realized would have been $5.30 per share, or $70,278.
(2) All options are vested. At December 31, 1997, there was no market for
the Common Stock, and the difference between the fair market value and
the exercise price was not readily ascertainable. However, based on the
$5.50 initial public offering price for the Common Stock, the
difference between the exercise price and such $5.50 value would have
yielded a value of unexercised options of $116,529 for Mr. Moore and
$184,570 for Mr. Clark.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with each of D.M.
(Rusty) Moore, Jr. and James W. Clark for three year terms that are renewed each
month. Such agreements are terminable only upon death, disability or for good
cause, including resignation. Upon termination for any other reason, the
executive is entitled to receive three year's severance pay.
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<PAGE> 12
PRINCIPAL SHAREHOLDERS AND SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information regarding the
ownership of Common Stock as of June 1, 1998 by each shareholder known to the
Company to own beneficially more than five percent of the outstanding Common
Stock, each current director and director nominee, each executive officer, and
all executive officers, directors and director nominees as a group, based on
information provided to the Company by such persons. The addresses of all such
persons are in care of the Company. Except pursuant to applicable community
property laws and except as otherwise stated, each such person has sole
investment and voting power with respect to the shares set forth in the table:
<TABLE>
<CAPTION>
Beneficial Ownership
of Common Stock
---------------------------------
NAME SHARES PERCENTAGE
- ---- ------ ----------
<S> <C> <C>
D.M. (Rusty) Moore, Jr.(1)................... 535,395 17.9
Mark S. Adler(2)............................. 188,941 6.3
James W. Clark(3)............................ 86,866 2.9
Frederick E. (Fritz) Mowery(4)............... 29,391 1.0
Robert W. Hendren(5)......................... 25,000 *
Timothy J. Gardner........................... 26,041 *
Harlan T. Cardwell, III...................... 11,410 *
Charles M. Duke, Jr.......................... 1,000 *
William C. Keane............................. 2,000 *
James M. Fehleison........................... 5,000 *
Gayle C. Tinsley............................. 12,000 *
All executive officers, directors
and director nominees as a group (11
persons)(6)................................ 923,044 30.8
</TABLE>
- -----------------------------
* Less than 1%
(1) Includes options to purchase 7,083 shares of Common Stock and 7,629
shares held of record by Mr. Moore's spouse.
(2) Includes options to purchase 1,500 shares of Common Stock.
(3) Includes options to purchase 6,458 shares of Common Stock.
(4) Includes options to purchase 2,334 shares of Common Stock and 14,666
shares of record held by Mr. Mowery's spouse.
(5) Includes options to purchase 15,000 shares of Common Stock, none of
which are presently vested.
(6) Includes options to purchase 32,375 shares of Common Stock.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed KPMG Peat Marwick LLP to serve as
the Company's independent auditors for the year ending December 31, 1998. The
shareholders are being asked to ratify the Board's appointment. The affirmative
vote, either in person or by proxy, of the holders of more than 50% of the
shares of Common Stock outstanding as of the Record Date, and that voted for or
against or expressly abstained, is necessary to ratify such appointment.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE
APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 1998.
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<PAGE> 13
SHAREHOLDER PROPOSALS FOR THE
1999 ANNUAL MEETING OF SHAREHOLDERS
Proposals of shareholders must be received by the Company at its
principal executive office at 13355 Noel Road, Suite 650, Dallas, Texas 75240,
by January 1, 1999 for inclusion in the Company's proxy statement and form of
proxy relating to the 1999 annual meeting of shareholders.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
KPMG Peat Marwick LLP served as the Company's principal independent
public accountants for 1997, and has been appointed by the Company to serve in
1998, subject to ratification by the shareholders at the annual meeting.
Representatives of KPMG Peat Marwick LLP are expected to be present at the 1998
annual meeting of shareholders with the opportunity to make a statement if they
so desire and will be available to respond to appropriate questions.
Cheshier & Fuller, L.L.P. served as the Company's independent public
accountants for 1996, but effective April 29, 1998, the Company chose not to
renew its engagement with Cheshier & Fuller, L.L.P. and engaged KPMG Peat
Marwick LLP. There were no disagreements with Cheshier & Fuller, L.L.P. on any
matters of accounting principles or practices, financial statement disclosure,
or auditing scope or procedure, which, if not resolved to its satisfaction,
would have caused it to make reference to such disagreement in its report. A
copy of a letter from Cheshier & Fuller, L.L.P. , addressed to the Securities
and Exchange Commission, concurring with the Company's statements herein has
been filed with the Securities and Exchange Commission. Neither of the reports
of Cheshier & Fuller, L.L.P. on the Company's financial statements for the
Company's fiscal years ended December 31, 1996 and 1995 contained an adverse
opinion or disclaimer of opinion, or was qualified or modified as to
uncertainty, audit scope, or accounting principles. The decision to change the
Company's principal independent accountant was approved by the Board of
Directors of the Company upon the recommendation of the Audit Committee.
OTHER MATTERS
The cost of solicitation of proxies in the accompanying form will be
paid by the Company. In addition to solicitation by use of the mails, certain
officers and employees of the Company may solicit the return of proxies by
telephone, telegram or personal interviews.
By Order of the Board of Directors
D. M. (Rusty) Moore, Jr.
President and Chief Executive Officer
June 26, 1998
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<PAGE> 14
COMMON STOCK PROXY
RUSHMORE FINANCIAL GROUP, INC.
THIS COMMON STOCK PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby (1) acknowledges receipt of the Notice of Annual
Meeting of Shareholders of Rushmore Financial Group, Inc. (the "Company") to be
held at The Westin Hotel Galleria Dallas, located at 13340 Dallas Parkway, 21st
Floor, Panorama Room, Dallas, Texas 75240, on July 17, 1998, beginning at 3:00
p.m., local time, and the Proxy Statement in connection therewith and (2)
appoints D. M. (Rusty) Moore, Jr. and James W. Clark, and each of them, the
undersigned's proxies with full power of substitution for and in the name, place
and stead of the undersigned, to vote upon and act with respect to all of the
shares of Common Stock of the Company standing in the name of the undersigned,
or with respect to which the undersigned is entitled to vote and act, at the
meeting and at any adjournment thereof.
The undersigned directs that the undersigned's proxy be voted as
follows:
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1. ELECTION OF [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY TO VOTE FOR [ ] ABSTAIN
DIRECTORS (except as marked to the contrary below) all nominees listed below from voting
Frederick E. (Fritz) Mowery, William C. Keane and Charles M. Duke, Jr.
(INSTRUCTION: To withhold authority to vote for any individual nominee, write that nominee's name on the line provided below.)
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2. RATIFY [ ] FOR ratification [ ] AGAINST ratification [ ] ABSTAIN
APPOINTMENT from voting
OF KPMG PEAT
MARWICK LLP
AS THE
COMPANY'S
AUDITORS
3. IN THE DISCRETION OF THE PROXIES, ON ANY OTHER MATTER WHICH MAY PROPERLY COME BEFORE THE MEETING.
This proxy will be voted as specified above. If no specification is made, this proxy will be voted for the election of
the director nominees in item 1 above and for the ratification in item 2 above.
The undersigned hereby revokes any proxy heretofore given to vote or act with respect to the Common Stock of the Company
and hereby ratifies and confirms all that the proxies, their substitutes, or any of them may lawfully do by virtue hereof.
If more than one of the proxies named shall be present in person or by substitute at the meeting or at any adjournment
thereof, the majority of the proxies so present and voting, either in person or by substitute, shall exercise all of the powers
hereby given.
Please date, sign and mail this proxy to the Company.
Date , 1998
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Signature of Shareholder
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Signature of Shareholder
Please date this proxy and sign your name exactly as
it appears hereon. Where there is more than one
owner, each should sign. When signing as an
attorney, administrator, executor, guardian or
trustee, please add your title as such. If executed
by a corporation, the proxy should be signed by a
duly authorized officer.
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