GOLDEN EAGLE GROUP, INC.
120 STANDIFER DRIVE
HUMBLE, TEXAS 77338
NOTICE OF ANNUAL MEETING
TO BE HELD JUNE 16, 1998
To all Stockholders of
GOLDEN EAGLE GROUP, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of GOLDEN EAGLE
GROUP, INC., a Delaware corporation (the "Company"), will be held at the
Sheraton Hotel, 15700 JFK Boulevard, Houston, Texas 77032 on Tuesday, June 16,
1998, at the hour of 9:00 A.M. for the following purposes:
1. To elect five Directors of the Company for the ensuing year;
2. To consider and vote upon a proposal to ratify the selection of Coopers &
Lybrand as independent auditors for the Company's fiscal year ending
December, 31, 1998; and
3. To transact such other business as may properly come before the meeting
The Board of Directors has fixed the close of business on May 22, 1998
as the record date for the determination of Stockholders entitled to notice of
and to vote at such meeting and any adjournment thereof.
DONALD A. NODORFT
SECRETARY
Houston, Texas
May 22, 1998
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND DATE THE ENCLOSED
PROXY, WHICH IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY, AND RETURN
IT TO THE COMPANY IN THE PREADDRESSED ENVELOPE PROVIDED FOR THAT PURPOSE. ANY
STOCKHOLDER MAY REVOKE HIS PROXY AT ANY TIME BEFORE THE MEETING BY WRITTEN
NOTICE TO SUCH EFFECT, BY SUBMITTING A SUBSEQUENTLY DATED PROXY OR BY ATTENDING
THE MEETING AND VOTING IN PERSON.
<PAGE>
GOLDEN EAGLE GROUP, INC.
120 STANDIFER DRIVE
HUMBLE, TEXAS 77338
PROXY STATEMENT
The Board of Directors presents this Proxy Statement to all stockholders and
solicits their proxies for the Annual Meeting of Stockholders (the "Meeting") to
be held on June 16, 1998.
All proxies duly executed and received will be voted on all matters
presented at the Meeting in accordance with the specifications made in such
proxies. In the absence of specified instructions, proxies so received will be
voted (1) FOR each of the named nominees to the Company's Board of Directors,
and (2) FOR the proposal to ratify the selection of Coopers & Lybrand L.L.P. as
the Company's independent auditors for the fiscal year ending December 31, 1998.
The Board does not know of any other matters that may be brought before the
Meeting nor does it foresee or have reason to believe that proxy holders will
have to vote for substitute or alternate nominees.
If any other matter should come before the Meeting or any nominee is not
available for election, the persons named in the enclosed Proxy will have
discretionary authority to vote all proxies not marked to the contrary with
respect to such matters in accordance with their best judgment. A proxy may be
revoked at any time before being voted by written notice to such effect received
by the Company at the address set forth above, attention Donald A. Nodorft,
Secretary, by delivery of a subsequently dated proxy or by a vote cast in person
at the Meeting. The Company will pay the entire expense of soliciting proxies,
which solicitation will be by use of the mails. It is anticipated that these
proxy materials will be mailed to stockholders of the Company on or about
June 1, 1998.
The Company's Annual Report to the Stockholders for the year ended
December 31, 1997, including financial statements, is being mailed with this
Proxy Statement to all stockholders entitled to vote at the Meeting. The Annual
Report does not constitute a part of the soliciting material.
Only stockholders of record at the close of business on May 22, 1998 are
entitled to vote at the Meeting. The total number of shares of Common Stock of
the Company outstanding as of April 27, 1998 was 6,410,218 shares. The Common
Stock is the only class of securities of the Company entitled to vote, each
share of Common Stock being entitled to one non-cumulative vote. A majority of
the shares of Common Stock outstanding and entitled to vote as of May 22, 1998,
or 3,205,110 shares, must be present at the Meeting in person or by proxy in
order to constitute a quorum for the transaction of business.
The affirmative vote of a plurality of the shares of Common Stock
present and voting at the Meeting is required for the election of Directors. The
affirmative vote of a majority of the shares of Common Stock present and voting
at the Meeting is required to pass upon the proposal to ratify the selection of
Coopers & Lybrand as independent auditors for the Company. Compagnie Daher de
Gerance et D'Armement ("Compagnie Daher") which holds approximately 42.4% of the
Company's outstanding Common Stock, has advised the Company that it intends to
vote in favor of the named nominees to the Company's Board of Directors and the
proposal to ratify the auditors at the Meeting.
Pursuant to Delaware law, abstentions and broker non-votes are counted
as present for purposes of determining the presence of a quorum. However,
abstentions are treated as present and entitled to vote and thus have the effect
of a vote against a matter. A broker non-vote on a matter is considered not
entitled to vote on that matter and thus is not counted in determining whether a
matter requiring approval
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of a majority of the shares present and entitled to vote has been approved or
whether a plurality of the shares present and entitled to vote has been voted.
A list of stockholders entitled to vote at the Meeting will be available
at the Company's offices, 120 Standifer Drive, Humble, Texas 77338, for a period
of ten days prior to the Meeting and at the Meeting itself for examination by
any stockholder.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth share ownership information as of April
27, 1998 with respect to (i) each person known to the Company to be a beneficial
owner of more than 5% of the Company's Common Stock, (ii) each Director of the
Company, (iii) the Chief Executive Officer and the two other most highly
compensated executive officers of the Company (the "Named Executive Officers")
and (iv) all executive officers and Directors of the Company as a group:
NAME AND ADDRESS
OF BENEFICIAL OWNER NUMBER OF SHARES(L) PERCENTAGE OWNERSHIP(L)
------------------- ------------------- -----------------------
Compagnie Daher............ 2,717,011 (2) 42.4%
120 Standifer Drive
Humble, TX 77338
Patrick M. Daher........... 2,739,511 (2) 42.7%
120 Standifer Drive
Humble, TX 77338
Lawrence Bauer........... 598,718 (3) 9.3%
4425 Waters Edge Lane
Sanibel, FL 33957
Henri Youngblood........... 393,750 (4) 6.1%
22 Export Drive
Sterling, VA 20164
Patrick H. Weston.......... 318,489 (5) 5.0%
120 Standifer Drive
Humble, TX 77338
Carlos A. Macaluso......... 151,100 (6) 2.4%
11700 N.W. 100th Road
Medley, FL 33178
Keith Bates................ 22,500 (7) -
120 Standifer Drive
Humble, TX 77338
John F. Darden............. 22,500 (7) -
120 Standifer Drive
Humble, TX 77338
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NAME AND ADDRESS
OF BENEFICIAL OWNER NUMBER OF SHARES(L) PERCENTAGE OWNERSHIP(L)
------------------- ------------------- -----------------------
Donald A. Nodorft 29,400 (8) -
120 Standifer Drive
Humble, TX 77338
All executive officers and
Directors as a group (eight
persons)................... 3,283,500 (9) 51.2%
(1) Except as otherwise noted, includes options and warrants
to purchase shares of Common Stock, which become
exercisable within 60 days of the date of this Report.
(2) Represents 2,626,965 shares of Common Stock held by
Compagnie Daher, of which Mr. Daher is Chairman of the
Board and Chief Executive Officer and 22,500 shares of
Common Stock issuable upon the exercise of stock options.
(3) Represents 598,718 shares of Common Stock issued in
connection with the October 27, 1997 acquisition by merger
of Columbia Shipping Group, Inc. including 129,143 shares
held in trust for the employees of Columbia Shipping
Group, Inc.
(4) Includes 2,000 shares of Common Stock issuable upon
exercise of stock options.
(5) Includes 131,500 shares of Common Stock issuable upon the
exercise of stock options.
(6) Includes 20,900 shares of Common Stock issuable upon
exercise of stock options.
(7) Represents 22,500 shares of Common Stock issuable upon
exercise of stock options.
(8) Represents 29,400 shares of Common Stock issuable upon
exercise of stock options held by the Company's Vice
President-Finance and Chief Financial Officer.
(9) Includes all shares of Common Stock described in note (2)
and notes (5) through (8).
<PAGE>
ELECTION OF DIRECTORS
Five Directors are to be elected at the Meeting to serve until the next
annual meeting of the Company's stockholders and until their respective
successors shall have been elected and shall have qualified or until their
earlier resignation, removal from office or death.
NOMINEES
The following table sets forth information concerning each nominee.
NAME AGE TITLE
- ---- --- -----
Patrick M. Daher 48 Chairman of the Board and
Director
Patrick H. Weston 55 President, Chief Executive
Officer and Director
Carlos A. Macaluso 45 Executive Vice President
Latin America and
Director
Keith Bates 58 Director
John F. Darden 51 Director
PATRICK M. DAHER was elected Chairman of the Board and a Director of the
Company in March 1994, upon completion of the acquisition by merger of Daher
America, Inc. (the "Merger"). Since 1991, Mr. Daher has been Chairman of the
Board and Chief Executive Officer of Compagnie DAHER, a French transportation
and logistics concern which became the Company's principal stockholder upon
completion of the Merger. From 1985 to 1990, Mr. Daher was Executive Vice
President of ETS DAHER & Co., a French-based freight forwarding concern.
PATRICK H. WESTON was elected President, Chief Executive Officer and a
Director of the Company in March 1994, upon completion of the Merger. From July
1985 until the Merger, Mr. Weston served as President and Chief Executive
Officer of DAHER America.
CARLOS A. MACALUSO is Executive Vice President for Latin America and a
Director of the Company. Mr. Macaluso has served as a Director since 1983. From
1983 until completion of the Merger, Mr. Macaluso also served as President and
Chief Operating Officer of the Company. Mr. Macaluso has been employed by the
Company since 1981.
KEITH BATES was appointed to the Board of Directors of the Company in
August 1994. Mr. Bates has been affiliated with Colgate-Palmolive since 1961 in
various capacities most recently as Vice President of European Operations since
1995, as Vice President of Manufacturing-Latin America from 1992 to 1994, and as
Director of Manufacturing-Latin America from 1986 to 1992.
JOHN F. DARDEN was elected a Director of the Company in November 1994.
Since 1986 Mr. Darden, a certified public accountant, has been Senior Vice
President-Finance and Chief Financial Officer of GAB Business Services, Inc. a
large insurance adjusting firm.
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ELECTION OF DIRECTORS AND EXECUTIVE OFFICERS; VOTING AGREEMENTS
Directors of the Company hold their offices until the next annual
meeting of the Company's stockholders and until their successors have been duly
elected and qualified or their earlier resignation, removal from office or
death.
Upon completion of the Merger, an agreement (the "Stockholders
Agreement") was entered into by and among the Company, Compagnie Daher, Patrick
H. Weston, Gary M. Goldfarb, Carlos A. Macaluso and William Goldfarb. (Gary M.
Goldfarb, Carlos A. Macaluso and William Goldfarb being collectively, the "GEG
Stockholders"), pursuant to which it was agreed that Compagnie Daher shall have
the right to designate four of the Company's seven Directors (the "Compagnie
Daher Designees") and the GEG Stockholders, in their capacity as Directors of
the Company, shall have the right to designate the remaining three Directors
(the "GEG Designees"). Pursuant to the Stockholders Agreement, the Company
agreed to include the Compagnie Daher Designees and the GEG Designees in
management's slate presented to stockholders at each annual meeting of
stockholders of the Company and use its best efforts to cause all such designees
to be elected. Compagnie Daher, Patrick H, Weston and the GEG Stockholders
agreed to vote their respective shares of Common Stock at each annual meeting of
stockholders of the Company for the election of the Compagnie Daher Designees
and the GEG Designees as Directors of the Company.
In December 1996, in conjunction with the resignation of Gary M.
Goldfarb as both an officer and director, the parties to the Stockholders
Agreement amended the Stockholders Agreement whereby the new board designee to
the seven member board who shall take Gary Goldfarb's place shall be nominated
by a Nominating Committee established by the Board of Directors (the "Nominating
Committee Designee"), and shall be elected by a simple majority vote of the
shareholders of the Company as provided in the Company's bylaws. The parties
further agreed that the remaining two board positions held by William Goldfarb
and Carlos Macaluso may only be held by those two persons and that they could
not nominate designees. When either of these gentleman relinquish their board
seat, such seat shall then be filled through the Nominating Committee process as
set out above. Such director would then be submitted to a vote of the
Shareholders at the Company's next annual Stockholders meeting.
In lieu of nominating a candidate to fill the vacant seventh seat on the
board, on April 25, 1997 the Board resolved by unanimous consent to reduce the
number of directors from seven to six. On March 17, 1998, William Goldfarb
resigned as a director of the Company. On March 27, 1998, in lieu of nominating
a candidate to fill the vacancy, the Board resolved to further reduce the number
of board seats to five.
Patrick M. Daher, Patrick H. Weston, Keith Bates and John F. Darden are
currently the Compagnie Daher Designees and Carlos A. Macaluso is the remaining
GEG Designee. The provisions of the Stockholders Agreement, as amended,
regarding the election of the Company's Directors will remain in effect for so
long as Compagnie Daher owns not less than 20% of the issued and outstanding
Common Stock.
Officers of the Company serve at the pleasure of the Board of Directors
and until the first annual meeting of the Board of Directors following the next
annual meeting of the Company's stockholders and until their successors have
been chosen and qualified.
COMMITTEES
The Board of Directors does not have a nominating committee, but rather
performs this function as a whole.
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AUDIT COMMITTEE. The Audit Committee, established in December 1997, is
currently comprised of Patrick M. Daher and John F. Darden. The Audit
Committee's responsibilities include selecting the audit firm, ongoing
communication with the audit firm and review of the audit's results.
COMPENSATION COMMITTEE. The Compensation Committee is currently
comprised of Patrick M. Daher, John F. Darden and Keith Bates. The Compensation
Committee's responsibilities consist of recommending and approving the salary
and fringe benefit policies of the Company, including compensation of executive
officers of the Company. The Compensation Committee was established in April
1994.
1992 STOCK OPTION COMMITTEE. The 1992 Stock Option Committee is
currently comprised of Patrick M. Daher, John F. Darden and Keith Bates. The
1992 Stock Option Committee administers the Company's Amended 1992 Stock Option
Plan (the "1992 Option Plan") and recommends and approves grants of stock
options under the 1992 Stock Option Plan. The 1992 Stock Option Committee was
originally established in January 1992 and was re-established in August 1994.
DIRECTORS STOCK OPTION COMMITTEE. The Directors Stock Option Committee,
established in April 1994, is currently comprised of Patrick H. Weston and
Carlos A. Macaluso. The Directors Stock Option Committee's responsibilities
include administering the 1994 Directors Stock Option Plan (the "Directors
Plan").
ADDITIONAL INFORMATION CONCERNING DIRECTORS
The Board of Directors of the Company held four meetings during the year
ended December 31, 1997. Each Director, during the period he served as such, was
present at not less than 75% of these meetings.
All Directors are reimbursed for travel, lodging and similar expenses
incurred in connection with their attendance at meetings of the Board of
Directors. In addition to the foregoing, in August 1994, the Board of Directors
adopted the 1994 Directors Stock Option Plan which compensates non-employee
directors for their time and efforts on behalf of the Company with annual grants
of options to purchase Common Stock. Grant provisions under the 1994 Directors
Stock Option Plan, were amended at the June 20, 1997 Shareholder Meeting,
whereby each non-employee director is entitled to an annual grant of 7,500
options to purchase Common Stock each succeeding December 31st, the ending date
of the Company's fiscal year.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's Directors, executive officers and holders of more than
ten percent of the Company's Common Stock to file initial reports of ownership
and changes in ownership of Common Stock with the Securities and Exchange
Commission (the "SEC") and NASDAQ. Such persons are required by SEC regulation
to furnish the Company with copies of all Section 16(a) forms they file.
Based solely upon a review of the Forms 3,4 and 5 and amendments
thereto, and certain written representations furnished to the Company, the
Company believes that during the year ended December 31, 1997, its executive
officers, directors and greater than ten percent (10%) beneficial owners
complied with all applicable filing requirements, except that Patrick Daher,
John Darden and Keith Bates, in connection with a review of their beneficial
ownership, detected certain possible deficiencies in their
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reporting to the Commission. In order to correct such possible deficiencies,
Patrick Daher, John Darden and Keith Bates each filed one Statement of Changes
in Beneficial Ownership on Form 4 covering an aggregate of one transaction.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE PROPOSED
NOMINEES FOR DIRECTOR.
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EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following compensation table sets forth, for the years ended
December 31, 1997, 1996 and 1995, the cash and certain other compensation paid
by the Company to the Named Executive Officers. For further information
concerning named executive officers see " Election of Directors".
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
--------------------------------------------------------------
Other Annual Shares Underlying
Compensation Options/SARS
Name and Principal Position Year Salary ($) Bonus ($) ($) (#)
--------------------------- ---- ---------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Patrick H. Weston (1) ........................ 1997 237,000 21,120 (2) 31,500(3)
President and CEO ............................ 1996 237,000 104,800 (2) --
1995 192,883 18,600 (2) 100,000(3)
Carlos A. Macaluso (4) ....................... 1997 145,000 15,840 (2) 20,900(3)
Executive Vice President ..................... 1996 143,400 61,730 (2) --
Sales and Marketing .......................... 1995 136,027 9,300 (2) 12,000(3)(5)
Donald A. Nodorft (6) ........................ 1997 110,000 15,840 (2) 18,400(3)
Vice President, Finance ...................... 1996 95,000 47,500 (2) 11,000(3)
and Chief Financial Officer
</TABLE>
(1) Mr. Weston became the Company's President and CEO upon completion of the
Merger in March 1994.
(2) Represents less than ten percent of the Named Executive Officer's
compensation.
(3) Represents options granted under the Company's Amended 1992 Stock Option
Plan (the "1992 Option Plan").
(4) Upon completion of the Merger in March 1994, Mr. Macaluso, the Company's
then President and Chief Operating Officer, became the Company's Executive
Vice President-Sales and Marketing. In 1996 Mr. Macaluso was appointed
Executive Vice President-South America.
(5) In February 1995, Mr. Macaluso agreed to accept 12,000 stock options
under the 1992 Option Plan in lieu of the issuance of additional shares
of Common Stock after the Company met certain performance goals in 1994
related to the October 1993 temporary salary reduction agreement. See
Employment Agreements.
(6) Mr. Nodorft became the Company's Vice President-Finance and CFO upon
completion of the Merger in March 1994. Total annual compensation for years
prior to 1996 was less than $100,000.
1992 OPTION PLAN
The 1992 Option Plan, as amended at the June 20, 1997 Annual Meeting of
the Stockholders, provides for issuance of options covering up to 900,000 shares
of Company Common Stock at a purchase price per share at least equal to one
hundred percent of fair market value of a share of Common Stock on the date of
grant. The purpose of the 1992 Option Plan is to provide additional incentives
to attract and retain qualified and competent persons as Directors, officers,
employees, consultants or agents who provide management services or upon whose
efforts and judgment the success of the Company is largely dependent, through
the encouragement of stock ownership in the Company by such persons. In
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furtherance of this purpose, the 1992 Option Plan authorizes (a) the granting of
incentive or non-qualified (as defined in the 1992 Option Plan) stock options to
purchase Common Stock to persons satisfying the description above and (b) the
provision of loans for the purpose of financing the exercise of options and the
amount of taxes payable in connection therewith.
Options are intended to be granted primarily to those persons who
possess a capacity to contribute significantly to the successful performance of
the Company. Because persons to whom grants of options are to be made are to be
determined from time to time by the 1992 Stock Option Committee or the Board of
Directors, in its discretion, it is impossible at this time to indicate the
precise number, name or position of persons who will receive options or the
number of shares for which options will be granted to any such person, except to
the extent already granted.
1994 DIRECTORS PLAN
The 1994 Directors Plan (the "Directors Plan"), as amended at the June
20, 1997 Annual Meeting of the Stockholders, provides for issuance of options
covering up to 250,000 shares of Company Common Stock at a purchase price per
share at least equal to one hundred percent of fair market value of a share of
Common Stock on the date of grant. The Company's directors who are not employees
of the Company are eligible to participate in the Directors Plan.
Prior to the June 20, 1997 amendment, non-employee directors were
granted options to purchase shares of Common Stock as follows: (i) options to
purchase 5,000 shares of Common Stock will be granted to each non non-employee
Director who joins the Company as of the date on which such person is elected or
appointed to the Board of Directors; and (ii) options to purchase 5,000 shares
of Common Stock will be granted to each non-employee Director on the date of
each annual meeting of stockholders. The amendment to the Directors Plan (a)
increased to 7,500, the number of options to be granted to each eligible
director on the Initial Grant Date and (b) increased the annual Option grant to
purchase shares each Eligible Director shall receive 7,500 on the last day of
the Company's fiscal year that ends at least six months after the Initial Grant
Date for each such Eligible Director.
On June 20, 1997, 20,000 additional grants were issued under the
provisions of the Directors Plan before amendment, compensating the non-employee
directors for services provided in fiscal year ended December 31, 1996. On
December 31, 1997, 30,000 additional grants were issued under the amended terms
for services performed for fiscal year ended December 31, 1997. All prior grants
are vested shares. As of April 8, 1998, options to purchase 114,000 shares of
Common Stock had been granted under the Directors Plan.
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OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning individual grants
of stock options made during the fiscal year ended December 31, 1997 to each of
the Named Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
NUMBER OF REALIZABLE VALUE AT
SHARES %OF TOTAL ASSUMED ANNUAL
UNDERLYING OPTIONS GRANTED EXERCISE OR RATES OF STOCK PRICE
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION APPRECIATION
NAME GRANTED (#) (1)FISCAL YEAR ($/SHARE) DATE 5%($) 10%($)
- ----------------- ------------- -------------- --------- --------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Patrick H. Weston 19,000 9.1% $ 2.375 06/20/2002 $ 6,989 $ 14,394
Carlos A. Macaluso 11,500 5.5% $ 2.375 06/20/2002 $ 4,230 $ 8,712
Donald A. Nodorft 9,000 4.3% $ 2.375 06/20/2002 $ 3,310 $ 6,818
- -----------------
</TABLE>
(1) Represents options granted under the 1992 Option Plan.
STOCK OPTIONS HELD AT END OF FISCAL 1997
The following table provides information concerning stock options
exercised by each of the three named executive officers and the value of options
held by each such officer on December 31, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Value of
Unexercised
In-the-Money
Shares Number of Unexercised Options
acquired OPTIONS AT FISCAL YEAR END FISCAL YEAR END (1)
on Value -------------------------- --------------------
EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Patrick H. Weston 47,000 $ 52,875 119,000 - $ 37,500 -
Carlos A. Macaluso - - 11,500 - - -
Donald A. Nodorft - - 20,000 - - -
</TABLE>
(1) Based on a closing bid price on December 31, 1997 of $2.125 per share as
reported by NASDAQ.
EMPLOYMENT AGREEMENTS AND TERMINATION OF EMPLOYMENT
AND CHANGE-IN-CONTROL ARRANGEMENTS
In March 1994, the Company entered into a five-year employment agreement
with Patrick H. Weston, which provides for an annual base salary of $175,000 and
a monthly car allowance of $1,000. The Company is also party an employment
agreement with Carlos A. Macaluso originally expiring in December 1997, which
provides for annual base salary of $125,000 and monthly car allowance of $550.
The employment agreement with each of Messrs. Weston and Macaluso also
provides that such officers will be entitled to participate in an annual bonus
pool to be established equal to five percent of the Company's pre-tax income for
each fiscal year before giving effect to extraordinary gains, which bonus
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pool will be allocated among the senior management of the Company by its Board
of Directors. The employment agreements may be extended for additional one-year
terms unless terminated by either party at least 90 days prior to the end of any
term. Pursuant to such employment agreements, the Company is obligated to pay
each employee full compensation pursuant to such agreement for the remainder of
the term of such agreement if the employee is terminated without cause. If an
employee's employment with the Company is terminated for any other reason, such
employee will not be entitled to any compensation pursuant to such agreement
except for any amounts accrued prior to such termination. Each of the employment
agreements contains non-competition and non-disclosure covenants.
On January 8, 1998, the Company entered into a employment agreement with
Donald A. Nodorft, the Company's Chief Financial Officer. The agreement commits
the Company to pay twelve months of then current compensation and accrued bonus
upon termination without cause.
On December 12, 1996, Mr. Gary Goldfarb resigned from his position as
Executive Vice President-Corporate Development of the Company to pursue various
outside consulting opportunities thereby terminating all remaining obligations
under an employment contract entered between he and the Company. Both parties
agreed that it was in the best interests of the Company for Mr. Goldfarb to be
available on a consulting basis to maintain continuity with certain business
interests brought to the Company by Mr. Goldfarb. The Company and Mr. Goldfarb
thus agreed to enter into a consulting agreement whereby Mr. Goldfarb was paid a
monthly consultation fee through November 30, 1997.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors reviews and
recommends the compensation arrangements for the named executive officers with
respect to salaries, bonuses and grants of options to purchase shares of Common
Stock under the Company's 1992 Stock Option Plan.
OBJECTIVES AND POLICIES
The Compensation committee strives to:
o motivate executive officers to create added value for the Company's
shareholders through compensation incentives that are tied to the
Company's operating performance
o reward executive officers for their individual performance and the
performance of the Company
o provide compensation and benefits at levels which enable the Company
to attract and retain high quality executives
To accomplish these objectives, the Compensation Committee retained a
professional consulting firm in 1995 to evaluate and advise the Committee on
compensation alternatives for its executive officers. The consulting firm took
into consideration the respective responsibilities of said officers, the size of
the company, compensation programs in peer group competitors and in companies of
similar size and operating characteristics. The Committee used the consultant's
study to establish base compensation levels for 1996 and subsequent years for
each of the named executives which would accomplish the stated objectives, and
then established a strong incentive plan based on operating performance targets
which would reward the executives with additional bonus compensation and grants
of options to purchase Common Stock.
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SUMMARY
The Compensation Committee, the Board of Directors and senior
management, takes executive compensation at the Company seriously. After
reviewing the Company's operating results for 1997, the Committee has concluded
that the amounts paid to executive officers in fiscal 1997 appropriately reflect
individual performance, are properly linked to established targets and goals of
the Company and are generally competitive with amounts paid to executive
officers of comparable companies.
COMPENSATION COMMITTEE
John F. Darden, Chairman
Patrick M. Daher
Keith Bates
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<PAGE>
PERFORMANCE GRAPH
The following Performance Graph compares the Company's cumulative total
shareholder return on its Common Stock for a five year period (December 31, 1992
to December 31, 1997) with the cumulative total return of The Nasdaq Stock
Market (US) and a peer group comprised of four publicly traded international
freight forwarders that most closely resemble the operations of the Company
(weighted for comparison purposes for stock market capitalization). The graph
assumes an investment of $100 in the Company's Common Stock and reinvestment of
all dividends. The Company did not pay any dividends during this period. The
following companies comprise the peer group: Air Express International, Fritz
Companies, Expeditors International, and Circle International.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG GOLDEN EAGLE GROUP, THE NASDAQ STOCK MARKET (US) AND A
PEER GROUP OF SIMILAR INTERNATIONAL FREIGHT FORWARDING COMPANIES
[GRAPHIC OMITTED]
12/31/92 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
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The Nasdaq Stock Market | 100.00 | 114.80 | 112.21 | 158.70 | 195.19 | 239.53
Golden Eagle Group | 100.00 | 77.42 | 41.94 | 51.61 | 70.97 | 54.84
Peer Group | 100.00 | 96.46 | 140.64 | 225.42 | 172.39 | 211.82
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The Comparisons in this table are required by the Securities and
Exchange Commission and are not intended to forecast or be indicative of
possible future performance of the Company's Common Stock.
15
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CERTAIN TRANSACTIONS
AGENCY AGREEMENT. The Company has an exclusive agency agreement with
Compagnie Daher pursuant to which the Company appointed Compagnie Daher as its
exclusive agent in France and Compagnie Daher appointed the Company as its
exclusive agent in the United States, other than with respect to one of
Compagnie Daher's existing accounts. Each party has the right to terminate the
agency agreement upon two months notice to the other party. The other terms of
the agency agreement are comparable to those between the Company and its
non-affiliated agents.
TRANSACTION BETWEEN CONTROL PERSONS:
In November 1997, Carlos A. Macaluso, the Company's Executive Vice
President, Latin America and a director, sold 57,000 shares of Common Stock
directly to the Company's major shareholder, Compagnie Daher.
In March 1998, Patrick H. Weston, the Company's CEO and a director, sold
33,046 shares of Common Stock directly to the Company's major stockholder,
Compagnie Daher.
GOLDFARB CONSULTING AGREEMENT. The Company entered into a Consulting
Agreement dated December 12, 1996 with Gary M. Goldfarb, a former director and
executive officer of the Company (the "Goldfarb Consulting Agreement"), to which
Mr. Goldfarb agreed to assist the Company with transition of certain business
interests in which he was involved with prior to his resignation from the
Company on December 12th 1996. The Goldfarb Consulting Agreement provided for a
monthly consulting fee of $11,000 to be paid through November 30, 1997.
16
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PROPOSAL TO RATIFY THE SELECTION OF INDEPENDENT AUDITORS
Unless instructed to the contrary, the persons named in the, enclosed
proxy intend to vote the same in favor of the ratification of the selection of
Coopers & Lybrand, L.L.P. as independent auditors to the Company for the fiscal
year ending December 31, 1998. It is anticipated that representatives of Coopers
& Lybrand will attend the meeting. Such persons will be afforded the opportunity
to make a statement and/or respond to appropriate questions from stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO RATIFY
THE SELECTION OF COOPERS & LYBRAND AS INDEPENDENT AUDITORS TO THE COMPANY FOR
THE FISCAL YEAR ENDING DECEMBER 31, 1998.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the Company's 1999
Annual Meeting of Stockholders pursuant to the provisions of Rule 14a-8 of the
Securities and Exchange Commission promulgated under the Securities Exchange Act
of 1934, as amended, must be received by the Company at its principal executive
offices by January 25, 1999 for inclusion in the Company's proxy statement and
form of proxy relating to such meeting.
GENERAL
As of the date of the Proxy Statement, the Company's management has no
knowledge of any business to be presented for consideration at the Annual
Meeting other than that described above. If any other business should properly
come before the Annual Meeting, it is intended that the shares represented by
proxies will be voted with respect thereto in accordance with the judgment of
the persons named in such proxies.
The cost of any solicitation of proxies by mail will be borne by the
Company. Arrangements may be made with brokerage firms and other custodians,
nominees and fiduciaries for the forwarding of material to and solicitation of
proxies from the beneficial owners of Common Stock held of record by such
persons, and the Company will reimburse such brokerage firms, custodians,
nominees and fiduciaries for the reasonable out of pocket expenses incurred by
them in connection therewith.
DONALD A. NODORFT,
------------------
SECRETARY
Houston, Texas
May 22, 1998
THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH PERSON WHOSE PROXY IS BEING
SOLICITED, UPON THE WRITTEN REQUEST OF SUCH PERSON, A COPY OF THE COMPANY'S
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997, AS FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE FINANCIAL STATEMENTS
THERETO. REQUESTS FOR COPIES OF SUCH REPORT SHOULD BE DIRECTED TO DONALD A.
NODORFT, SECRETARY, GOLDEN EAGLE GROUP, INC., 120 STANDIFER DRIVE, HUMBLE, TEXAS
77338.
17
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[FRONT SIDE OF PROXY]
PROXY
GOLDEN EAGLE GROUP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF THE STOCKHOLDERS TO BE HELD ON JUNE 16, 1998.
The undersigned hereby appoints Patrick M. Daher and Patrick H. Weston,
jointly and severally, as Proxies, with the power of substitution, and
authorizes them to represent and to vote at the Annual Meeting of Stockholders
to be held June 16, 1998, or any adjournment thereof, all the shares of Common
Stock of Golden Eagle Group, Inc. held of record by the undersigned on May 22,
1998, as designated below.
1. Election of directors - director nominees:
Patrick M. Daher, Patrick H. Weston, Carlos A. Macaluso,
Keith Bates, John F. Darden.
[ ] FOR all nominees listed above [ ] WITHHOLD AUTHORITY
(except as indicated below) to vote for all nominees
Instruction: to withhold authority to vote for any of the above
nominees, write the nominee's name(s) on this line.
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2. To ratify the selection of Coopers & Lybrand, L.L.P. as independent
accountants.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. The Proxies are authorized to vote in their best judgment upon such
business as may properly come before the Annual Meeting.
[REVERSE SIDE OF PROXY]
This Proxy, when properly executed, will be voted in the manner directed
by the undersigned stockholder. Please refer to the Proxy Statement for a
discussion of each of these matters. IF NO DIRECTION IS GIVEN, THIS PROXY WILL
BE VOTED FOR THE PROPOSALS. As to any other matter, said Proxies shall vote in
accordance with their best judgment.
Please sign exactly as name appears below. When shares are held joint
tenants, both should sign. If acting as attorney, executor, trustee, or in any
other representative capacity, sign name and title.
Dated ______________________, 1998
-----------------------------------------
Signature
-----------------------------------------
Signature if held jointly
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THIS PROXY CARD USING THE ENCLOSED
ENVELOPE.
