<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or 240.14a-12
</TABLE>
Simula, 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 Rule 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(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:
------------------------------------------------------------------------
<PAGE> 2
SIMULA, INC.
------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 10, 1998
------------------------------------------------------------
The 1998 Annual Meeting of Stockholders of Simula, Inc. (the
"Company") will be held at The Grace Inn, 10831 South 51st Street, Phoenix,
Arizona 85044 on Wednesday, June 10, 1998, at 8:00 a.m., for the following
purposes:
1. To ratify the selection of Deloitte & Touche LLP, as the
independent public accountants for the Company's fiscal year
1998;
2. To vote for the election of nine Directors; and
3. To transact such other business as may properly come before
the meeting.
April 17, 1998 was the record date for the determination of the
Stockholders entitled to notice of, and to vote at, this meeting. The list of
Stockholders entitled to vote at this meeting is available, upon advance
request, at the offices of Simula, Inc., 2700 North Central Avenue, Suite 1000,
Phoenix, Arizona 85004 for examination by any Stockholder.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE SIGN,
DATE AND RETURN THE ENCLOSED PROXY, WHICH IS SOLICITED BY AND ON BEHALF OF THE
SIMULA, INC. BOARD OF DIRECTORS. THE GIVING OF SUCH PROXY WILL NOT AFFECT YOUR
RIGHT TO REVOKE SUCH PROXY OR TO VOTE IN PERSON SHOULD YOU LATER DECIDE TO
ATTEND THIS MEETING.
By Order of the Board of Directors
Bradley P. Forst
Secretary
Phoenix, Arizona
May 1, 1998
<PAGE> 3
SIMULA, INC.
2700 NORTH CENTRAL AVENUE
SUITE 1000
PHOENIX, ARIZONA 85004
------------------------------
PROXY STATEMENT
------------------------------
GENERAL
Proxies in the form enclosed are solicited by the Board of Directors of
Simula, Inc. (the "Company") for use at the 1998 Annual Meeting of Stockholders
of the Company to be held on June 10, 1998. Proxy materials were mailed on or
about May 12, 1998, to Stockholders of record as of the close of business on
April 17, 1998.
PROXIES
Execution of the enclosed proxy will not in any way affect a
Stockholder's right to attend the meeting and vote in person. Stockholders
giving proxies may revoke them at any time before they are exercised by filing
with the Secretary of the Company a written revocation or a proxy bearing a
later date, or by attending the meeting and voting in person.
The Company will bear the cost of solicitation of proxies, including
the charges and expenses of brokerage firms and others who forward proxy
materials to beneficial owners of stock. Solicitation by the Company will be by
mail.
ANNUAL REPORT
The Company's Annual Report accompanies this proxy. The Company's
Report on Form 10-K was filed with the United States Securities and Exchange
Commission ("SEC") on March 31, 1998. The Form 10-K is not incorporated by
reference herein. The Form 10-K is available on the Company's web site, which is
www.simula.com, and on the SEC's EDGAR web site. Additionally, the Form 10-K and
any exhibit will be furnished to any requesting person who contacts the Company.
The fee for furnishing a copy of the report and any exhibit is $3.00.
VOTING SECURITIES
As of April 17, 1998, the record date for Stockholders entitled to
vote at the meeting, there were 9,873,270 outstanding shares of the Company's
Common Stock. Each share of Common Stock is entitled
<PAGE> 4
to one vote on each matter to be considered at the Annual Meeting. Cumulative
voting for the election of Directors is permitted. A majority of the total
number of shares of Common Stock outstanding constitutes a quorum. If a quorum
is represented in person or by proxy at the Annual Meeting, the affirmative vote
of a majority of the shares will constitute the approval of the Stockholders.
Votes cast by proxy or in person at the meeting will be tabulated by the
Company's stock transfer agent, Corporate Secretary, and staff acting as
election inspectors. The election inspectors will treat abstentions as shares
that are present and entitled to vote for purposes of determining the presence
of a quorum, but will be counted as unvoted for purposes of determining approval
of any matter. Under the rules of the New York Stock Exchange, if a broker
holding stock in "street name" indicates on the proxy that it does not have
discretionary authority as to certain shares to vote on a particular matter,
those shares will not be considered as present and entitled to vote with respect
to that matter and a "broker non-vote" will have no effect on the voting on the
matter. Subject to the foregoing, executed, duly returned proxies will be voted
as directed. If no specification is made, shares represented by the proxy will
be voted "for" matters presented for consideration.
SECURITY OWNERSHIP OF CERTAIN PRINCIPAL STOCKHOLDERS
AND MANAGEMENT
The following table sets forth information with respect to the number
of shares of Common Stock of the Company, as of April 17, 1998, beneficially
owned by (a) each person known to the Company to own more than five percent of
the outstanding shares; (b) individual Directors; (c) Named Executive Officers
(defined hereafter); and (d) all Directors and Named Executive Officers of the
Company as a group. The backgrounds, age, position as an officer, and terms of
Directors and Named Executive Officers is set forth in this proxy under "The
Board of Directors."
<TABLE>
<CAPTION>
SHARES OWNED
-------------------------------------
Name of Beneficial Owner Number(1) Percentage(2)
- ------------------------ --------- -------------
<S> <C> <C>
Directors and Executive Officers:
Stanley P. Desjardins(3) 3,274,114 33%
Donald W. Townsend(4) 575,449 6%
Bradley P. Forst(5) 281,154 3%
Sean K. Nolen(6) 155,279 2%
James C. Withers(7) 26,400 *
Robert D. Olliver(8) 24,572 *
Scott E. Miller(9) 27,550 *
John M. Leinonen(10) 15,000 *
James F. Smith(11) -0- *
All Directors and Officers as a group 4,379,518 40%
(9 persons)
5% STOCKHOLDERS:
Brian J. Stark and Michael A. Roth(12) 659,840 7%
Scudder Kemper Investments, Inc(13) 722,900 7%
</TABLE>
- ---------------------------------------
(1) An * indicates ownership of less than 1% of the outstanding Common
Stock. The number of shares shown in the table, including the notes
thereto, have been rounded to the nearest whole share. Includes, when
applicable, shares owned of record by such person's spouse and by other
related individuals, trusts, and entities over whose shares of Common
Stock
2
<PAGE> 5
such person has custody, voting control or power of disposition. Also
includes shares of Common Stock that the identified person had the
right to acquire within 60 days of April 18, 1998 by the exercise of
stock options.
(2) The percentages shown include the shares of Common Stock which the
person will have the right to acquire within 60 days of April 18, 1998.
In calculating the percentage of ownership, all shares of Common Stock
which the identified person will have the right to acquire within 60
days of April 18, 1998 upon the exercise of stock options are deemed to
be outstanding for the purpose of computing the percentage of shares of
Common Stock owned by such person, but are not deemed to be outstanding
for the purpose of computing the percentage of the shares of Common
Stock owned by any other person.
(3) The address of Mr. Desjardins and all other Directors and executive
officers is 2700 North Central Avenue, Suite 1000, Phoenix, Arizona
85004.
(4) Includes options to purchase 529,800 shares of Common Stock which are
presently exercisable.
(5) Includes options to purchase 280,000 shares of Common Stock which are
presently exercisable.
(6) Includes options to purchase 155,000 shares of Common Stock which are
presently exercisable.
(7) Includes options to purchase 26,250 shares of Common Stock which are
presently exercisable.
(8) Includes options to purchase 23,937 shares of Common Stock which are
presently exercisable.
(9) Includes options to purchase 25,500 shares of Common Stock which are
presently exercisable.
(10) Ownership total comprised of options to purchase 15,000 shares of
Common Stock which are first exercisable in June 1998.
(11) Mr. Smith owns options to purchase 15,000 shares of Common Stock
granted to him when he was first elected to the Company's Board of
Directors in April 1998. The options are not exercisable, however,
until April 1999.
(12) Messrs. Stark and Roth jointly have filed a Schedule 13D ownership
statement with the SEC and hold the shares identified in the table
through various holding entities. The address of Messrs. Stark and Roth
is 1500 West Market Street, Mequon, Wisconsin 53902.
(13) Scudder Kemper Investments, Inc. has filed a Schedule 13G ownership
statement with the SEC. The address of Scudder Kemper Investments, Inc.
is 345 Park Avenue, New York, New York 10154.
PROPOSAL NO. 1.
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Company's Board of Directors, acting upon the recommendation of its
Audit Committee, has selected and is submitting to Stockholders for their
confirmation the appointment of Deloitte & Touche, LLP, as auditors for the
Company for its current fiscal year ending December 31, 1998. The approval of
the Stockholders is being sought because of the importance of independent public
accountants in a publicly held corporation. If the Stockholders do not approve
the appointment of Deloitte & Touche, the Company's Board of Directors will
reconsider its selection of independent accountants.
For the year ended December 31, 1997, Deloitte & Touche provided audit
services to the Company, including examination of the annual consolidated
financial statements of the Company, review of unaudited quarterly financial
information, assistance and consultation in connection with filing the Company's
Reports to the Securities and Exchange Commission ("SEC") on Forms 10-Q and
10-K, registration statements on Forms S-3 and S-8 and other filings with the
SEC, and consultation in connection with various audit-related and accounting
matters.
Each year, the Audit Committee will review and approve in advance the
scope of the annual audit
3
<PAGE> 6
by the Company's independent accountants. The Audit Committee will also be
advised of significant non-audit professional services provided by such
accountants to assess whether the rendering of such services would impair the
independence of the firm.
It is intended that the proxies will be voted in favor of ratifying
the selection of the Company's independent accountants unless instructions to
the contrary are indicated on the accompanying proxy form.
PROPOSAL NO. 2
ELECTION OF DIRECTORS
The Articles of Incorporation of the Company provide for a Board of
Directors of not less than two nor more than fifteen members, which number may
be altered as provided in the Company's bylaws. Vacancies occurring during a
term may be filled by the Company's Board of Directors for the remainder of the
full term. In 1995, the Company's Board of Directors adopted, and the
Stockholders approved, a proposal to provide for the prospective classification
of the Company's Board of Directors. Classification results in the Company
"staggering" the terms of members of the Board of Directors so that only a
portion of the Directors are elected at each Annual Meeting of Stockholders.
The Board of Directors has determined that it is in the Company's best
interest to classify the Directors for the first time in the election to occur
at the 1998 Annual Meeting of Stockholders. The Company presently has nine
members on its Board of Directors. All Directors are standing for re-election at
the 1998 Annual Meeting of Stockholders. If elected, Directors will be
classified into three groups of three each, with the first group's (Class I)
term being one year and expiring in 1999, the second group's (Class II) term
being two years and expiring in 2000, and the third group's (Class III) term
being three years and expiring in 2001. Hereafter, in those years, members of
the appropriate class will stand for election for three year terms.
Standing for re-election at the 1998 Annual Meeting of Stockholders are
Stanley P. Desjardins, Donald W. Townsend, Bradley P. Forst, Sean K. Nolen,
James C. Withers, Robert D. Olliver, Scott E. Miller, and John M. Leinonen. Mr.
Fred J. Musone was appointed to the Board on August 14, 1997 and resigned on
March 17, 1998. Mr. James F. Smith was appointed on March 31, 1998 to assume Mr.
Musone's vacant seat on the Board and is standing for election to the Board for
the first time at the 1998 Annual Meeting of Stockholders.
The Board of Directors is classified for election as follows:
<TABLE>
<CAPTION>
CLASS I-TERM EXPIRING 1999 Class II-Term Expiring 2000 Class III-Term Expiring 2001
-------------------------- --------------------------- ----------------------------
<S> <C> <C>
James C. Withers Robert D. Olliver Scott E. Miller
James F. Smith John M. Leinonen Stanley P. Desjardins
Bradley P. Forst Sean K. Nolen Donald W. Townsend
</TABLE>
Pursuant to the provisions of Arizona General Corporation Law, at each
election for Directors, every Stockholder is entitled to cumulative voting at
such election and thus has the right to vote, in person or by proxy, the number
of shares owned by him for as many persons as there are Directors to be elected
4
<PAGE> 7
or to cumulate his or her votes by giving one candidate as many votes as the
number of such Directors multiplied by the number that his shares equal, or by
distributing such vote on the same principle among any number of such
candidates.
It is intended that the proxies will be voted for the nominees or for
a substitute nominee, in the case of any nominee who becomes unavailable, on a
pro rata noncumulative basis among the nominees unless instructions to the
contrary are indicated on the proxy form.
THE BOARD OF DIRECTORS
The following table sets forth certain information about the
individuals who are nominated for election as Directors and includes additional
information about the Company's Named Executive Officers.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Stanley P. Desjardins 67 Chairman of the Board of Directors
Donald W. Townsend 58 Chief Executive Officer, President and Director
Bradley P. Forst 45 Vice President, General Counsel, Secretary and Director
Sean K. Nolen 35 Vice President of Finance, Treasurer and Director
James C. Withers 64 Director
Robert D. Olliver 71 Director
Scott E. Miller 38 Director
John M. Leinonen 60 Director
James F. Smith 52 Director
</TABLE>
Stanley P. Desjardins. Mr. Desjardins founded the Company in 1975 and
has served as its Chairman since that time. He was President from 1975 until
October 1994. Mr. Desjardins pioneered crashworthy seating technology for the
United States armed forces and continues to work on technology development as a
recognized world expert in the field. He has approximately 40 years of
experience in research and development of aerospace systems and components,
including over 30 years in research and development of technology for improving
survival in vehicle crashes. Prior to forming the Company, Mr. Desjardins was
Manager of Aircraft Safety for a division of Ultrasytems, Inc., where he managed
research programs involving the crashworthiness of aircraft seating and
restraint systems. From 1958 to 1968, he held various positions in missile
programs with Thiokol Chemical Corporation. His work has resulted in several
United States patents related to energy-absorption and rocket nozzle design. He
is the author or co-author of 26 technical articles related to his research. Mr.
Desjardins is a member of the American Helicopter Society, the Survival and
Flight Equipment Association, the Arizona Innovation Network, The Center for
Aerospace Safety Education, and The Governor's Science and Technology Council
(Arizona).
Donald W. Townsend. Mr. Townsend has served as Chief Executive Officer
of the Company since December 1997 and President since October 1994. He was
Executive Vice President from 1989 to 1994, Treasurer and Secretary from 1986
until 1994, and has been a Director since 1989. Prior to joining the Company in
1985, Mr. Townsend was employed by Walled Lake Door Company, a manufacturer of
wooden doors, in positions as Vice President of Finance, Chief Financial
Officer, Director, and Controller. Mr. Townsend is a Certified Public
Accountant.
5
<PAGE> 8
Bradley P. Forst. Mr. Forst joined the Company as Vice President,
General Counsel, Secretary, and as a Director in 1995. Prior to joining the
Company, Mr. Forst was engaged in the private practice of law in Phoenix,
Arizona, from 1985 to 1995. Included among his clients was the Company, for whom
he provided corporate, finance, and securities legal services for a number of
years. Prior to entering private practice in Phoenix, Mr. Forst was an attorney
in the head office legal department of Shell Oil Company based in Houston,
Texas. Mr. Forst received his J.D. from the University of Tulsa College of Law
in 1978, and his LL.M. from Columbia University School of Law in New York City
in 1981.
Sean K. Nolen. Mr. Nolen joined the Company as Vice President of
Finance, Chief Financial Officer, Treasurer, and as a Director in 1996. Prior to
joining the Company, from 1984 to 1996 Mr. Nolen was employed by Deloitte &
Touche LLP. Included among his positions was as an Audit Senior Manager, in
which capacity Mr. Nolen provided auditing, planning, and other assistance and
consultation to numerous privately and publicly held companies, including the
Company. Mr. Nolen received his B.S. in Accountancy from Northern Arizona
University. Mr. Nolen is a Certified Public Accountant.
James C. Withers. Mr. Withers has served as a Director of the Company
since its initial public offering in 1992. Mr. Withers is the Chief Executive
Officer of Materials and Electrochemical Research Corporation based in Tucson,
Arizona. He has served in that capacity since 1985. From 1986 to 1988, Mr.
Withers was President and Chief Executive Officer of Keramont Research
Corporation, also based in Tucson, Arizona.
Robert D. Olliver. Mr. Olliver has served as a Director of the Company
since its initial public offering in 1992. Mr. Olliver is the Director of Risk
Management Services for Acordia of Arizona, based in Phoenix, Arizona. Mr.
Olliver has over 48 years experience in the insurance business. Mr. Olliver,
through his affiliates, has been the general agent for the Company's insurance
programs since 1987.
Scott E. Miller. Mr. Miller has served as a Director of the Company
since January 1995. Mr. Miller is a Director of Investment Banking of H.D. Brous
& Co., Inc., a co-managing underwriter of certain of the Company's private and
public offerings of securities. From 1991 to 1994, Mr. Miller was Director of
Investment Banking of W.B. McKee Securities, Inc., Phoenix, Arizona, which was
the managing underwriter of the Company's initial public offering. From 1987 to
1991, Mr. Miller was the Director of Investments of Bellmar Partners, an
investment fund. Mr. Miller also currently serves on the Board of Directors of
Meadow Valley Corporation, a publicly held construction company specializing in
highways, bridges and overpasses.
John M. Leinonen. Mr. Leinonen is Vice President, Automotive Business
Development, for Exponent Failure Analysis Associates, Inc., an analytical,
testing, and safety engineering services firm. From 1960 to 1995, Mr. Leinonen
was employed by Ford Motor Company, where for over a 22 year period he directed
all activities in Ford's automotive safety office, including vehicle safety
assurance, safety regulations and planning, and production vehicle safety and
compliance. Mr. Leinonen was President of the Society of Automotive Engineers
("SAE") in 1995, and has served six years as a member of SAE's Board of
Directors. Mr. Leinonen is a Registered Professional Engineer.
James F. Smith. Mr. Smith is Vice President and General Manager for the
worldwide inflatable restraint systems business of TRW Inc. TRW is the world's
largest independent supplier of occupant restraint systems. Mr. Smith has been
employed by TRW or its affiliates in positions of increasing responsibility
since 1969. Mr. Smith received a B.S. in Industrial Management from Purdue
University and is a member of SAE.
6
<PAGE> 9
DIRECTOR COMPENSATION
Directors who are not executive officers receive $5,000 annual cash
compensation for their services in that capacity to cover expenses. Directors
who are executive officers do not receive such additional compensation for their
services as Directors. Outside Directors are also awarded options to purchase
15,000 shares upon commencement of service on the Board and 1,500 additional
shares on an annual basis thereafter.
BUSINESS OF THE BOARD OF DIRECTORS
During the fiscal year ended December 31, 1997, the Company's Board of
Directors held three meetings. All Directors were present at all meetings.
AUDIT COMMITTEE
The Company's Audit Committee is comprised of Messrs. Withers, Olliver
and Miller, all of whom are outside (non-employee) Directors. The functions of
the Audit Committee are to receive reports with respect to loss contingencies,
the public disclosure of which may be required; the annual review and
examination of those matters that relate to a financial and performance audit of
the Company's employee benefit plans; to recommend to the Company's Board of
Directors the selection, retention and termination of the Company's independent
accountants; to review the professional services, proposed fees and independence
of such accountants; and to provide for the periodic review and examination of
management performance in selected aspects of corporate responsibility. The
Audit Committee held one meeting during the fiscal year ended December 31, 1997.
COMPENSATION COMMITTEE
The Company's Compensation Committee consists of Messrs. Withers,
Olliver and Miller, all of whom are outside (non-employee) Directors. The
functions of the Compensation Committee are to review annually the performance
of the Chief Executive Officer and other executive officers and to set
compensation. Additionally, the Compensation Committee's role is to review
compensation of outside Directors for service on the Company's Board of
Directors and for service on committees of the Company's Board of Directors, and
to review the level and extent of applicable benefits provided by the Company
with respect to health and medical coverage, stock options and other stock plans
and benefits. The Compensation Committee held three formal meetings and two
telephonic meetings during the fiscal year ended December 31, 1997. See "Report
Of The Compensation Committee" and "Interlocks and Insider Participation" in the
following sections.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires each director and executive officer of the Company, and
each person who owns more than ten percent (10%) of a registered class of the
Company's equity securities to file by specific dates with the Securities
7
<PAGE> 10
and Exchange Commission (the "SEC") reports of ownership and reports of change
of ownership of equity securities of the Company. Officers, Directors, and 10%
stockholders are required by the SEC to furnish the Company with copies of all
Section 16(a) forms they file. The Company is required to report in this report,
any failure of its Directors and executive officers to file by the relevant due
date, any of these reports during the Company's fiscal year. To the Company's
knowledge, all Section 16(a) filing requirements were complied with during the
fiscal year ended December 31, 1997.
LIMITATION ON LIABILITY OF DIRECTORS
The General Corporation Law of the State of Arizona, under which the
Company is organized, was amended in full effective January 1, 1996. Subsequent
to such modification of the Arizona Corporate Code, the Company, through
resolution of its Board of Directors and approval of its Stockholders at the
1996 Annual Meeting, amended and restated its Articles of Incorporation,
providing for the limitation or elimination of potential monetary liability of
Directors of the Company to the fullest extent permitted by Arizona law. The
Arizona Corporate Code limits or eliminates the liability of a director of a
corporation for money damages in any action taken or not taken as a director in
all instances except (i) instances where a director receives financial benefits
to which he is not entitled; (ii) any intentional infliction of harm on the
corporation or its Stockholders; (iii) the making of unlawful distributions; and
(iv) intentional violations of criminal law.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Board of Directors has a policy that provides that all
transactions between the Company and its executive officers, Directors,
employees and affiliates are subject to the approval of a majority of
disinterested Directors of the Board of Directors and will be on terms that are
no less favorable to the Company than those that could be negotiated with
unaffiliated parties.
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<PAGE> 11
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee is comprised of three outside (non-employee)
Directors. The compensation of the Company's CEO and Named Executive Officers is
set by the Committee. Since 1995, the Committee's objectives have been first, to
provide that executive compensation is competitive and second, to align
compensation with increases in Stockholder value.
No base compensation increases were given in 1997. Executive
compensation remained unchanged from 1995 levels. Similarly, cash bonuses were
discussed and deferred again in 1997. These decisions were made to accommodate
the view that financial results and budgetary plans for the Company made
executive compensation increases inappropriate. Nevertheless, the Committee
acknowledges that cash compensation paid to executive officers was significantly
below competitive levels generally.
In assessing compensation, the Committee relies upon the report of an
independent compensation consulting firm retained in 1995 to provide advice to
the Committee with respect to executive compensation. Additionally, in 1996 and
1997, the Committee instructed the Company's finance department to review
publicly filed documents and independent compensation surveys and prepare an
analysis of compensation levels in a peer group of companies of similar size,
lines of business, and geographic area. Based upon the reports described above,
the Committee believed that to achieve a level of a competitive total
compensation in 1997, other means should be utilized including, opportunities
for equity ownership; employment agreements; death benefits; and, change of
control protections.
The Committee believes that in lieu of, or as a supplement to cash
compensation, stock options motivate employees to serve the Company in a manner
that will provide the best overall return to the Company's Stockholders, and the
Committee seeks to grant stock options to key employees in a manner consistent
with such belief. Having reviewed the performance of the Company's management,
the Compensation Committee approved the grant of stock options in January 1997
based upon the achievement of objectives for the Company including, record
revenues; management of significant investments in new product manufacturing
capacity; and refinement of a financial reporting system including monthly
subsidiary performance to budget target reviews. The Committee will make similar
evaluations in 1998.
In 1996, the Committee authorized the purchase of key-man life
insurance for six key employees and members of management. These policies,
purchased in 1997, provide that in the event of death during the term of
employment, a portion of the death benefit proceeds will be paid to the Company
and portion to the employee's designated beneficiary.
To supplement compensation and in the interest of furthering the
Company's ability to attract and retain quality managers, the Compensation
Committee also continues to favor agreements which provide for severance pay,
immediate vesting and liquidation of stock options, and tax assistance, in the
event of a change in control of the Company. Six key employees and members of
management have such agreements with the Company. Similarly, Stanley Desjardins
and Donald Townsend have historically been retained pursuant to employment
agreements, and the Committee approved like agreements to retain other
executives. The terms of the change of control and employment agreements
currently in place are disclosed herein under the section "EXECUTIVE
COMPENSATION -- Employment and Related Agreements."
9
<PAGE> 12
On a going forward basis, the Committee has determined that
compensation increases in 1998 will be granted in consideration of, among other
things, the following: (i) increase in common stock value; (ii) the cost of
replacing a member of executive management; (iii) competitive compensation by
industry; (iv) competitive compensation by company size and complexity; (v)
competitive compensation by geographic location; and (vi) performance of tasks
beyond respective job descriptions and titles. In considering these objectives
as a whole and if the Company meets its 1998 financial objectives, compensation
packages will be increased.
Robert D. Olliver
James C. Withers
Scott E. Miller
SUMMARY COMPENSATION TABLE
The following table sets forth the total compensation received by the
Company's "Named Executive Officers" as defined by SEC Regulation S-K 402(a)3,
comprised of the Chief Executive Officer and each other person who is an
executive officer of the Company whose total remuneration exceeded $100,000 for
services rendered in all capacities to the Company during the last three fiscal
years.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------------------------- ------------
Securities
Other Annual Underlying
NAME AND PRINCIPAL POSITION Year Salary(1) Bonus(2) Compensation(3) Options
- --------------------------- ---- --------- -------- --------------- -------
<S> <C> <C> <C> <C> <C>
Stanley P. Desjardins 1997 $200,000
Chairman of the Board 1996 200,000
1995 200,000
Donald W. Townsend 1997 200,000 238,200
President 1996 200,000 Tax Assistance(3) 70,000
1995 180,000 40,000 Tax Assistance(3) 60,000
Bradley P. Forst 1997 140,000 93,750
Vice President, General Counsel 1996 140,000 50,000
and Secretary(4) 1995 140,000 56,250
Sean K. Nolen 1997 120,000 150,000
Vice President of Finance, Chief 1996 120,000 25,000
Financial Officer, and Treasurer(5)
</TABLE>
- ---------------------------------------
(1) In addition to salary, nominal amounts are contributed by the Company
to the 401(k) accounts of Messrs. Desjardins and Townsend. See
"Executive Compensation -- 401(k) Profit Sharing Plan."
(2) The Compensation Committee declared a bonus for Mr. Townsend for
services in 1994 and 1995, which was paid in late 1995.
10
<PAGE> 13
(3) In 1995, the Compensation Committee adopted policies to encourage
executive management of the Company to exercise stock options and
thereby become equity owners of the Company. In order to exercise such
options, members of management were required to sell such underlying
shares in the market to provide the funds to pay for the option
exercises. Because of the immediate exercise and sale, incentive tax
aspects of the options, under relevant IRS rules, were eliminated.
Accordingly, taxes on such sales were immediately due and payable. As
part of the policy, the Committee determined to pay such taxes for the
accounts of the executives. Such payments by the Company were fully
deductible as a compensation expense and such amounts did not accrue to
the individuals, but were paid to state and federal taxing authorities.
The amounts of such tax assistance on behalf of Mr. Townsend were
$231,367 and $211,500 for the fiscal years 1995 and 1996.
(4) Mr. Forst was not employed by the Company for the entire fiscal year
1995. The salary figure contained in the column for 1995 reflects the
salary Mr. Forst would have received had he been employed by the
Company for the entire year. Mr. Forst's actual salary compensation
from the Company for 1995 was $60,000.
(5) Mr. Nolen was not employed by the Company for the entire fiscal year
1996. The salary figure contained in the column for 1996 reflects the
salary Mr. Nolen would have received had he been employed by the
Company for the entire year. Mr. Nolen's actual salary compensation
from the Company for 1996 was $80,000.
STOCK OPTIONS AND BENEFIT PLANS
Stock Option Plans
In 1992, the Company adopted the Simula 1992 Stock Option Plan. The
1992 Plan provided for the issuance of up to 360,000 shares of the Company's
Common Stock pursuant to grants made under the 1992 Plan. In August 1994, the
Board of Directors adopted the 1994 Stock Option Plan, which was subsequently
approved by the Stockholders of the Company at the Annual Meeting in June 1995.
The 1994 Plan currently reserves up to 2,500,000 shares of Common Stock for
issuance under the Plan. Through December 31, 1997, a total of 1,681,775 options
had been granted pursuant to the 1994 Plan.
Except as to the number of shares reserved for issuance under the 1992
Plan and the 1994 Plan, respectively, the provisions, terms and conditions of
the two plans, (together, the "Plans"), are substantially the same. The Plans
authorize the Company to grant to key employees of the Company (i) incentive
stock options to purchase shares of Common Stock, and (ii) non-qualified stock
options to purchase shares of Common Stock. The objectives of the Plans are to
provide incentives to key employees to achieve financial results aimed at
increasing Stockholder value and attracting talented individuals to the Company.
Although the Plans do not specify what portion of the shares may be awarded in
the form of incentive stock options or non-statutory options, a substantially
greater number of incentive stock options were and have been awarded under the
1992 Plan and 1994 Plan, respectively, and it is anticipated that a majority of
remaining options to be awarded under the 1994 Plan will be incentive stock
options. The incentive stock options are qualified stock options under the
Internal Revenue Code. Persons eligible to participate in the Plans are those
employees of the Company whose performance had or may have significant effect on
the success of the Company.
The Plans are administered by the Compensation Committee of the Board
of Directors, which has the authority to interpret the Plans' provisions, to
establish and amend rules for their administration, to determine the types and
amounts of awards made pursuant to the Plans, subject to the Plans' limitations,
and to approve recommendations made by management of the Company as to who
should receive awards. The Compensation Committee of the Board of Directors must
consist of outside Directors.
Incentive stock options may be granted under the Plans for terms of up
to ten years and at an exercise price at least equal to 100% of the fair market
value of the Common Stock as of the date of
11
<PAGE> 14
grant, and 85% of the fair market value in the case of non-statutory options,
except that incentive options granted to any person who owns stock possessing
more than 10% of the combined voting power of all classes of the Company's stock
or of any parent or subsidiary corporation must have an exercise price at least
equal to 110% of the fair market value of the Company's Common Stock on the date
of grant. The aggregate fair market value, determined as of the time an
incentive stock option is granted, of the Common Stock with respect to which
incentive stock options are exercisable by an employee for the first time during
any calendar year may not exceed $100,000. There is no aggregate dollar
limitation on the amount of non-statutory stock options which may be exercisable
for the first time by an employee during any calendar year. Payment of the
exercise price is to be in cash, although the Compensation Committee may, in its
discretion, allow payment in the form of shares of the Company's Common Stock
under certain circumstances. Any option granted under the Plans will expire at
the time fixed by the Committee, which will not be more than 10 years after the
date it is granted. Any employee receiving a grant must remain continuously
employed by the Company for a period of twelve months after the date of the
grant, as a condition to the exercise of the option. The Compensation Committee
may also specify when all or part of an option becomes exercisable, but in the
absence of such specification, the option will ordinarily be exercisable in
whole or part at any time during its term. In addition, optionees who are
Directors or executive officers of the Company may not exercise any portion of
an option within six months of the date of grant. Subject to the foregoing, the
Compensation Committee may accelerate the exercisability of any option in its
discretion.
The Company may assist optionees in paying the exercise price of
options granted under the Plans by either the extension of a loan by the Company
for payment by the optionee of the exercise price in installments, or a
guarantee by the Company of a loan obtained by the optionee from a third party.
The terms of any loan, installment payments or guarantees, including the
interest rate and terms of repayment and collateral requirements, if any, shall
be determined by the Compensation Committee.
In the event of a change in control of the Company, all issued but
unvested options become immediately vested and exercisable. In connection with
immediate exercises made by certain covered executive officers of the Company,
the Company will pay tax assistance to supply the funds necessary for those
individuals to pay taxes resulting from income, the loss of tax incentives and
accelerated exercises and sales. See "Executive Compensation - Employment and
Related Agreements."
1992 Restricted Stock Plan
In February 1992, the Company adopted the 1992 Restricted Stock Plan
("Restricted Stock Plan") authorizing the Company to grant to key employees of
the Company and other individuals who provide services to the Company an
aggregate of 19,500 shares of Common Stock. The Restricted Stock Plan is
intended to allow the Company to provide awards of Common Stock to long-term
employees who have provided valuable past services to the Company. The
Restricted Stock Plan authorizes disinterested members of the Board of Directors
to determine the persons to whom the restricted stock plan will be granted and
the terms and conditions and restrictions of such awards. As of the date of this
Proxy Statement, 4,500 shares have been issued under the Restricted Stock Plan.
12
<PAGE> 15
Options Granted under Plans
In fiscal 1997, the Board of Directors granted a total of 858,900
incentive stock options under the Plans. The following table sets forth
information regarding options granted in 1997 to Named Executive Officers
identified in the Summary Compensation Table:
OPTION GRANTS IN LAST FISCAL YEAR
(Individual Grants)
<TABLE>
<CAPTION>
Potential Realizable
Percent of Value at Assumed
Number of Total Annual Rates
Securities Options Exercise of Stock Price
Underlying Granted to or Base Appreciation for
Options Employees in Price Expiration Option Term(1)
Name Granted Fiscal Year ($/Sh) Date 5%($) 10%($)
- ---- ------- ----------- ------ ---- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Donald W. Townsend 238,200 28% $13.50 2007 $5,238,036 $8,340,698
Bradley P. Forst 93,750 11 13.50 2007 2,061,570 3,282,705
Sean K. Nolen 150,000 17 13.50 2007 3,298,512 5,252,328
</TABLE>
- ---------------------------------------
(1) Calculated from a base price equal to the exercise price of each
option, which was the fair market value of the Common Stock on the date of
grant. The amounts represent only certain assumed rates of appreciation. Actual
gains, if any, on stock option exercises and Common Stock holdings cannot be
predicted, and there can be no assurance that the gains set forth on the table
will be achieved. Further, the number shown is the gross dollar value of the
Common Stock, but does not give effect to the payment of the purchase price to
exercise the option, and thus does not represent the net value or net gain, and
does not reflect the taxes payable on such gain.
FISCAL YEAR END OPTIONS VALUES
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised In-the-Money
Options at Fiscal Year End Options at Fiscal Year End
Name (#) Exercisable/Unexercisable ($)(1)Exercisable/Unexercisable
---- ----------------------------- -------------------------------
<S> <C> <C>
Donald W. Townsend 404,800 / -0- $1,017,118 / -0-
Bradley P. Forst 150,000 / 50,000 299,981 / 90,625
Sean K. Nolen 25,000 / 150,000 -0- / 271,875
</TABLE>
- ---------------------------------------
(1) Calculated by multiplying the number of shares underlying outstanding
in-the-money options by the difference between the last sales price of
the Company's Common Stock on December 31, 1997 ($15.3125 per share)
and the exercise prices for both exercisable and unexercisable shares.
13
<PAGE> 16
DEFINED BENEFIT PENSION PLAN
The Company adopted a non-contributory defined benefit pension plan as
of November 1, 1980. To be eligible, participants must have completed six months
of continuous service and have attained the age of 21. Benefits are based on the
length of service and the participants' final pay (averaged over the five
highest consecutive years of his last ten years of participation). The Company
makes contributions to the plan based on actuarially-determined amounts. Both
Mr. Desjardins and Mr. Townsend are participants in the plan consistent with the
normal terms and conditions of the plan.
The following table sets forth the estimated annual benefits payable
on retirement for specified earnings and years of service categories for
participants.
<TABLE>
<CAPTION>
PENSION PLAN TABLE
YEARS OF SERVICE(1)
-------------------------------------------------------------------------------------------------------
Remuneration 15 20 25 30 35
- -------------------- ---------------- ---------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
$50,000 $17,500 $17,500 $17,500 $17,500 $17,500
75,000 26,250 26,250 26,250 26,250 26,250
100,000 35,000 35,000 35,000 35,000 35,000
150,000 52,500 52,500 52,500 52,500 52,500
200,000 70,000 70,000 70,000 70,000 70,000
</TABLE>
- ---------------------------------------
(1) As of December 31, 1997, Mr. Desjardins' and Mr. Townsend's credited
years of service are 17 and 12, respectively.
(2) Benefits are calculated on a straight-life annuity basis. The
compensation covered by the retirement plan includes all wages and
salaries but excludes bonuses. Benefits under the retirement plan are
not subject to deduction for Social Security or other offset amounts.
401(k) PROFIT SHARING PLAN
The Company's 401(k) Profit Sharing Plan (the "PSP") is qualified under
Sections 401(a) and 401(k) of the Internal Revenue Code. The PSP was adopted
effective November 1, 1989. The PSP is administered under a trust, and the
Company's Directors are currently serving as its trustees. All employees of the
Company who are 21 years or older, including its executive officers, are
eligible to participate in the PSP after six months of employment with the
Company.
Under the PSP, participating employees have the right to elect their
contributions to the PSP be made from reductions from compensation owed to them
by the Company. In addition, the Company at its discretion can make
contributions to the PSP of a percentage of a participant's annual compensation.
Participating employees are entitled to full distribution of their share of the
Company's contributions under the PSP upon death, disability or when they reach
retirement age. If their employment is terminated earlier, their share of the
Company's contributions will depend on the number of years of employment with
the Company. All participating employees have the right to receive 100% of their
own contributions to the PSP upon any termination of employment. Apart from the
Company's and the employee's contributions, they may receive investment earnings
related to the funds in their account under this plan.
14
<PAGE> 17
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee consists of Messrs. Miller,
Olliver and Withers, all of whom are outside Directors for purposes of
administering the stock option plans under SEC Rule 16(b)(3). There were no
interlocks among the Compensation Committee or named executive officers of other
corporations or compensation committees.
EMPLOYEE STOCK PURCHASE PLAN
At the 1996 Annual Meeting, the Company's Board of Directors and
Stockholders adopted the Employee Stock Purchase Plan ("ESPP" or "Plan"). The
ESPP provides eligible employees with the opportunity to acquire a stock
ownership interest in the Company through periodic payroll deductions. The
purpose of the Plan is to provide incentive to employees of the Company to
perform in a manner which enhances the value of the Company's Common Stock by
providing a direct ownership stake in the Company's performance.
The ESPP reserves 400,000 shares of the Company's Common Stock to be issued
to employees eligible to participate in the Plan. Employees of the Company and
its subsidiaries are eligible to participate in the Plan following 30 days of
continuous service with the Company, provided that such employees work in excess
of 20 hours per week and greater than five months per calendar year. The
Company, at its discretion, need not include all of its operating subsidiaries
in the ESPP.
Eligible employees invest in the Plan through regular payroll deductions of
up to 10% of their gross earnings, deducted net of taxes, for each semi-annual
period of participation, provided that no employee may purchase greater than
$25,000 worth of the Company's Common Stock in any given calendar year. Payroll
deductions are credited to an account established in each participating
employee's name and shares of the Company's Common Stock are automatically
purchased on behalf of participating employees on the last business day of each
semi-annual period of participation at the lesser of (i) 85% of the market price
per share of Common Stock on an individual's entry date into the Plan (subject
to certain limitations), or (ii) 85% of the market price per share on the
semi-annual purchase date.
The Company commenced operation of the ESPP on October 1, 1996. The
Plan provides for semi-annual purchase dates to occur on March 31 and September
30 of each year.
EMPLOYMENT AND RELATED AGREEMENTS
Employment Agreements
Since 1992, the Company has had an employment agreement with Mr. Donald
Townsend. Upon the approval of the Compensation Committee, the Company renewed
the agreement, on substantially the same terms, with Mr. Townsend effective
January 1, 1998 (the "Agreement"). The Agreement is designed to assure that the
Company will have the continued employment and dedication of Mr. Townsend as its
President and Chief Executive Officer.
15
<PAGE> 18
Unless earlier terminated as described below, the Agreement is
effective for a term of five years. At the end of the first year of the
Agreement and every year thereafter, the Agreement will be automatically renewed
for a continuous five year term unless terminated by the Company for cause, or
death or disability, or by Townsend for good reason. Townsend's base salary is
subject to review and upward adjustment by the Compensation Committee of the
Company's Board of Directors on an annual basis. In addition to such base
salary, the Agreement provides that Townsend be entitled to participate in any
and all additional compensation or benefit plans now in place or later adopted,
such as annual bonus or option plans; incentive, savings and retirement plans;
and welfare benefit plans. See "Executive Compensation - Stock Option and
Benefit Plans.
The Agreement provides that in the event Townsend is terminated for
reasons other than for cause, or death or disability, or the Agreement is
terminated by Townsend for good reason, Townsend will be entitled to receive a
lump sum cash payment consisting of: (i) the annual base salary compensation
which would have been payable to Townsend over the remaining term of the
Agreement, as it may have been renewed, had the Agreement not been so
terminated; (ii) any declared and accrued, but unpaid, bonus or stock option
grant (whether or not vested); (iii) other benefits including accrued vacation
pay, and amounts under the Company's benefit and retirement plans. The Agreement
provides that in the event it is terminated by Townsend's death, without further
obligation the Company will transfer to Townsend's estate all accrued
compensation to date, stock options and retirement and other benefits, such as
life insurance proceeds, as applicable under the Company's various plans as then
in effect. In the event the Agreement is terminated on account of Townsend's
disability, the Company will pay to Townsend all accrued salary and bonuses and
other benefits through the date of termination, and provide for the vesting and
non-forfeiture of all granted stock options. In addition, the Company will
continue to pay Townsend a salary amount equal to the difference between
Townsend's salary then in effect under the Agreement and the proceeds received
by him from disability insurance. In the event the Agreement is terminated for
cause, Townsend will only be entitled to receive the salary and bonuses and
those benefits accrued as of the date of termination. In addition to the
foregoing, the Agreement provides that in the event that it is determined that
any payment under the Agreement be subject to the payment by Townsend of the
excise tax imposed by Section 4999 of the Internal Revenue Code or parallel
state or local tax laws, Townsend will be entitled to receive from the Company
an additional "gross- up" payment in an amount equal to the excise tax and all
related penalties, interest and other charges.
The Agreement prohibits Townsend from competing with the Company during
his employment and for a period of thirty (30) months following his termination
of employment with the Company. The Agreement also provides for continuing
duties on Townsend's part regarding the non-disclosure and confidentiality of
the Company's proprietary information.
In addition to the Townsend Agreement, effective January 1, 1998 the
Company entered into employment agreements with Named Executive Officers Forst
and Nolen, and two other key employees and members of management. Such
agreements have differing salary levels and effectiveness periods, but are
otherwise on the same terms as described above for the Townsend Agreement.
Change of Control Agreements
In addition to employment agreements, the Company has also entered
into change of control agreements with Named Executive Officers Townsend, Forst
and Nolen, and three other key employees and members of management. The
objectives of the agreements are to attract and retain qualified executives,
encourage key management personnel to devote full attention to the Company's
business in the event a third party expresses an intention to acquire or merge
with the Company, and to provide
16
<PAGE> 19
compensation in the event of termination of employment of such an individual
upon a change of control of the Company. The agreements are effective for the
duration of the employee's employment and terminate only upon the employee's
termination of employment with the Company. "Change of control" means the
occurrence of any of the following events: (i) when any person acquires,
directly or indirectly, beneficial ownership of more than 20% of the Company's
Common Stock; (ii) a change in the membership of a majority of the Board of
Directors in one or more contested elections; (iii) a merger or consolidation
where voting power of the Company's securities changes or the Company is not the
surviving corporation; or, (iv) the sale, transfer, or other disposition in one
or more transactions, of all or substantially all of the assets of the Company.
In the event of such a change of control, covered employees who are terminated
by the acquiring person within one year, or voluntarily resign within 180 days,
after the effective date of the change of control, will receive compensation and
benefits including: (i) a multiple of their then current annual base salary,
plus the equivalent dollar value of all benefits, such multiple being in a range
from 3 to 5 depending on such individual's position; (ii) immediate vesting of
all stock options, which will then at the employee's election be exercised and
paid for by the Company or the acquiring person on the employee's behalf; and
(iii) tax assistance and gross-up payments to supply the funds necessary for the
employee to pay all income and excise taxes resulting from these compensation,
benefits, and stock option transactions. See "Executive Compensation - Stock
Option Plans."
STOCK PERFORMANCE GRAPH
The graph on the following page shows the Company's total return to
Stockholders compared to three indices over the period from December 31, 1992
(the last day of the fiscal year following the Company's initial public
offering), through December 31, 1997, the last day of the most recent fiscal
year.
Due to the fact that it is difficult to find a line of business index
or peer group index of comparable companies, the indices were selected to
represent (i) the stock market as a whole; and (ii) companies with similar
market capitalization to the Company.
The cumulative total return shown on the Stock Performance Graph
indicates historical results only, and is not necessarily indicative of future
results. The Performance Graph shall not be deemed incorporated by reference by
any general statement into any filing under the Securities Act of 1933 or under
the Securities Exchange Act of 1934.
17
<PAGE> 20
[GRAPH]
VALUE OF $100 INVESTMENT
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Simula, Inc. $ 100.00 $ 114.50 $ 480.00 $ 600.00 $ 432.00 $ 490.00
Russell 3000 index $ 100.00 $ 108.14 $ 105.46 $ 140.88 $ 167.91 $ 217.39
S&P 600 Small Cap Index $ 100.00 $ 117.59 $ 110.74 $ 142.40 $ 171.07 $ 213.03
Nasdaq Composite Index $ 100.00 $ 114.64 $ 111.08 $ 155.42 $ 190.71 $ 231.97
</TABLE>
18
<PAGE> 21
OTHER MATTERS
The Company's Board of Directors is not aware of any matters to be
presented at the meeting other than those described above. However, if other
matters properly come before the meeting, it is the intention of the persons
named in the accompanying proxy to vote said proxy on such matters in accordance
with their judgment.
STOCKHOLDER PROPOSALS
Any Stockholder desiring to have a proposal included in the Company's
Proxy Statement for its 1999 Annual Meeting must deliver such proposal (which
must comply with the requirements of Rule 14a-8 promulgated under the Securities
Exchange Act of 1934) to the Company's principal executive offices not later
than February 13, 1999.
19
<PAGE> 22
PROXY
SIMULA, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS
FOR THE 1998 ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 10, 1998
The undersigned hereby appoints Donald W. Townsend and Bradley P. Forst,
and each of them, with full power of substitution, as proxies, to represent the
undersigned at the 1998 Annual Meeting of Shareholders of Simula, Inc. (the
"Company") to be held on Wednesday, June 10, 1998 at 8:00 a.m., Mountain
Standard Time, and at any adjournment thereof, and to vote all shares of the
Company's Common Stock standing in the name of the undersigned on the matters
set forth on the reverse side of this card and upon any other matters that may
properly come before the meeting or any adjournment thereof as follows:
PLEASE DATE, SIGN AND RETURN PROMPTLY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
SEE REVERSE
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.) SIDE
<PAGE> 23
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF SHAREHOLDERS
SIMULA, INC.
JUNE 10, 1998
[DOWN ARROW] PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED [DOWN ARROW]
[X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
1. Ratification of independent public accountants (Deloitte & Touche, LLP).
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
FOR ALL
(except vote withheld
from the nominees WITHHOLD
listed at right) ALL
2. Election of nine [ ] [ ] FOR ALL, except
directors -- vote withheld
from the following
nominees:
__________________
Cumulative Votes for one or more nominees as follows:
__ Stanley P. Desjardins __ Scott E. Miller __ Robert D. Olliver
__ Bradley P. Forst __ Donald W. Townsend __ John M. Leinonen
__ James C. Withers __ Sean K. Nolen __ James F. Smith
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AT THE MEETING IN ACCORDANCE
WITH THE SPECIFICATIONS APPEARING ABOVE. THE SHARES WILL BE VOTED "FOR" ANY
PROPOSAL FOR WHICH NO CONTRARY SPECIFICATION IS MADE.
PLEASE MARK, SIGN AND DATE THIS PROXY CARD PROMPTLY AND RETURN IT USING THE
ENCLOSED ENVELOPE.
SIGNATURE(S) ________________________________ DATE: _________________ , 1998
NOTE: Please sign exactly as name appears on the stock certificates. When
signing as attorney, executor, administrator, trustee, guardian, etc.,
give full title as such. If stock is held jointly, each owner should
sign.
