<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule
14a-11(c) or Rule 14a-12
FRITZ COMPANIES, INC.
------------------------------------------------
(Name of Registrant as Specified in Its Charter)
------------------------------------------------
(Name of Person(s) Filing Proxy Statement,
if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
Common Stock, $0.01 par value
(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
FRITZ LOGO
FRITZ COMPANIES, INC.
706 MISSION STREET
SAN FRANCISCO, CALIFORNIA 94103
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
WEDNESDAY, SEPTEMBER 29, 1999, 10:30 A.M.
TO THE STOCKHOLDERS:
Notice is hereby given that the Annual Meeting of Stockholders of Fritz
Companies, Inc. will be held at The Argent Hotel, 50 Third Street, San
Francisco, California, on Wednesday, September 29, 1999, at 10:30 A.M. for the
following purposes:
(1) To elect six directors.
(2) To transact such other business as may properly come before the
meeting.
Only stockholders of record on the books of the Company as of 5:00 PM,
August 2, 1999 are entitled to vote at the meeting and any adjournment thereof.
By Order of the Board of Directors
Jan H. Raymond,
Secretary
Dated: August 20, 1999
STOCKHOLDERS ARE REQUESTED TO MARK, DATE, SIGN AND RETURN THE ENCLOSED PROXY AS
PROMPTLY AS POSSIBLE.
<PAGE> 3
FRITZ LOGO
FRITZ COMPANIES, INC.
706 MISSION STREET
SAN FRANCISCO, CALIFORNIA 94103
------------------------
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of Fritz
Companies, Inc. (the "Company") to be used at the Annual Meeting of Stockholders
on September 29, 1999, for the purposes set forth in the foregoing notice. This
proxy statement and the enclosed form of proxy were first sent to stockholders
on or about August 25, 1999.
If the enclosed form of proxy is properly signed and returned, the shares
represented thereby will be voted at the Annual Meeting in accordance with the
instructions specified thereon. If the proxy does not specify how the shares
represented thereby are to be voted, the proxy will be voted FOR the election of
the six directors proposed by the Board unless the authority to vote for the
election of directors (or for any one or more nominees) is withheld. Any
stockholder signing a proxy in the form accompanying this Proxy Statement has
the power to revoke it prior to or at the Annual Meeting. A proxy may be revoked
by a writing delivered to the Secretary of the Company stating that the proxy is
revoked, by a subsequent proxy signed by the person who signed the earlier
proxy, or by attendance at the Annual Meeting and voting in person.
VOTING SECURITIES
Only stockholders of record on the books of the Company as of 5.00 P.M.,
August 2, 1999, will be entitled to vote at the Annual Meeting.
As of the close of business on August 2, 1999, there were outstanding
36,523,614 shares of Common Stock of the Company, entitled to one vote per
share. The holders of a majority of the outstanding shares of the Common Stock
of the Company, present in person or by proxy, will constitute a quorum for the
transaction of business at the Annual Meeting or any adjournment thereof.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the election inspectors appointed for the Meeting and will determine whether or
not a quorum is present. The election inspectors will treat abstentions and
broker non-votes as shares that are present and entitled to vote for purposes of
determining the presence of a quorum. With regard to the election of directors,
votes may be cast "For" or "Withhold Authority" for each nominee; votes that are
withheld will be excluded entirely from the vote and will have no effect. If a
broker 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.
Therefore, a broker non-vote will have no effect on the election of directors.
ELECTION OF DIRECTORS
The persons named below are nominees for director to serve until the next
Annual Meeting of Stockholders and until their successors shall have been
elected. The nominees constitute the present Board of Directors.
In the absence of instructions to the contrary, shares represented by the
proxy will be voted and the proxies will vote for the election of all such
nominees to the Board of Directors. If any of such persons is
<PAGE> 4
unable or unwilling to be a candidate for the office of director at the date of
the Annual Meeting, or any adjournment thereof, the proxies will be voted for
such substitute nominee as shall be designated by the persons appointed in the
proxies. The management has no reason to believe that any of such nominees will
be unable or unwilling to serve if elected a director. Set forth below is
certain information concerning the nominees, which is based on data furnished by
them.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST SERVED AS
NOMINEES FOR DIRECTOR AGE FIVE YEARS AND OTHER INFORMATION DIRECTOR SINCE
- --------------------- --- -------------------------------- --------------
<S> <C> <C> <C>
Lynn C. Fritz........ 57 Chairman of the Board. Mr. Fritz has been the Company's Chief 1977
Executive Officer since 1986. Mr. Fritz is a director of
Manugistics Corporation (developer of software for supply chain
management).
Dennis L. Pelino..... 51 President since August 1996. Mr. Pelino was Chief Operating 1991
Officer from January 1994 until September 1998, Executive Vice
President from January 1994 until August 1996 and Senior Vice
President from August 1992 until January 1994.
James Gilleran....... 66 Chairman of the Board and Chief Executive Officer of The Bank of 1992
San Francisco and its parent, The San Francisco Company since
November 1994. Mr. Gilleran was Superintendent of the California
State Banking Department from 1989 until November 1994. Mr.
Gilleran is a director of Zindart (Holdings) Ltd. (toys and
collectibles).
Preston Martin....... 75 Chairman, President and Chief Executive Officer of Martin 1992
Holdings, Inc. (bank asset holding company), Chairman of Martin
Associates (consulting firm) and Chairman of LINC Group, Inc.
(insurance agency). Mr. Martin is a director of SoCal Savings
(financial institution holding company) and INCO Homes (home
builder). Mr. Martin was previously Vice Chairman of the Board
of Governors of the Federal Reserve Board.
Paul S. Otellini..... 48 Executive Vice President of Intel Corporation (semiconductor 1998
manufacturer). Mr. Otellini is a director of Autodesk Corp.
(software provider).
William J. Razzouk... 51 Chairman and Chief Executive Officer of PlanetRx (internet 1998
pharmacy and healthcare company). From September 1997 until May
1998, Mr. Razzouk was President and Chief Operating Officer of
Storage USA (real estate investment trust). From February 1996
until June 1996, Mr. Razzouk was President of America Online
(internet services). Prior to February 1996, Mr. Razzouk was
Executive Vice President of Federal Express Corporation
(provider of global transportation logistics). Mr. Razzouk is a
director of Waste Connections, Inc. (waste management).
</TABLE>
FURTHER INFORMATION CONCERNING
THE BOARD OF DIRECTORS
COMMITTEES OF THE BOARD
During the fiscal year ended May 31, 1999 ("Fiscal 1999"), the Board of
Directors held five meetings and acted by unanimous written consent on a number
of occasions. The Board of Directors has two committees: the Audit Committee and
the Compensation Committee.
The members of the Audit Committee are James Gilleran and Paul S. Otellini.
Among the functions performed by this committee are to make recommendations to
the Board of Directors with respect to the engagement or discharge of
independent auditors, to review with the independent auditors the plan and
results of the auditing engagement, to review the Company's internal auditing
procedures and system of internal accounting controls and to make inquiries into
matters within the scope of its functions.
2
<PAGE> 5
The members of the Compensation Committee are Preston Martin and William
Razzouk. Among the functions performed by this committee are to review and make
recommendations to the Board of Directors concerning the compensation of the key
management employees of the Company and to administer the Company's equity
incentive and 401(k) plans.
During Fiscal 1999, the Audit Committee held five meetings and the
Compensation Committee held one meeting.
ATTENDANCE AT MEETINGS
During Fiscal 1999, there were no members of the Board of Directors who
attended fewer than seventy-five percent of the meetings of the Board of
Directors and all committees of the Board on which they served.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company are paid directors' fees
consisting of $24,000 per year and $1,000 for each Board meeting attended.
Directors who attend committee meetings receive an additional $1,000 for each
meeting not held on the same day as a Board meeting. Of the $24,000 annual
retainer paid to nonemployee directors, 60% is paid in Common Stock pursuant to
the Nonemployee Director Restricted Stock Plan.
EXECUTIVE COMPENSATION
COMPENSATION OF EXECUTIVE OFFICERS
The compensation paid to the Company's Chief Executive Officer and the four
other most highly compensated executive officers for services in all capacities
to the Company and its subsidiaries during the fiscal years indicated is set
forth below.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------ --------------------------
OTHER ANNUAL SECURITIES
NAME AND COMPENSATION RESTRICTED UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($)(1) STOCK($)(2) OPTIONS(#) COMPENSATION($)
------------------ ---- --------- -------- ------------ ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Lynn C. Fritz......... 1999 $500,000 -- $ 8,040 -- 250,000 --
Chairman of the 1998 $500,000 -- $ 8,040 -- 50,000 --
Board and Chief 1997 $500,000 -- $15,000 -- -- --
Executive Officer
Dennis L. Pelino...... 1999 $375,000 -- -- $500,000 30,000 --
President 1998 $375,000 -- -- -- -- --
1997 $358,300 -- $ 5,000 $690,000 -- --
Joseph Carnes......... 1999 $251,250 -- -- $267,446(3) 30,000 $52,265(7)
Executive Vice- 1998 $220,000 -- $ 6,000 $138,562(3) 15,000 --
President 1997 $206,667 -- $ 6,000 $238,000(3) 4,667 --
Robert Arovas......... 1999 $246,667 -- -- $205,000(4) 30,000 --
Executive Vice- 1998 $230,000 -- -- $ 60,000(4) 25,000 --
President and Chief 1997 $ 82,400(5) -- -- -- 10,000 --
Financial Officer(8)
Jan H. Raymond........ 1999 $220,417 -- -- $211,370(6) 20,000 $25,841(7)
Executive Vice- 1998 $200,000 -- -- $118,562(6) 15,000 --
President, Secretary 1997 $189,700 -- $15,500 $ 10,500(6) 6,000 --
and General Counsel
</TABLE>
- ---------------
(1) While the named executive officers enjoy certain perquisites, for fiscal
years 1997, 1998 and 1999 these did not exceed the lesser of $50,000 of 10%
of each officer's salary and bonus.
3
<PAGE> 6
(2) As of the end of fiscal year 1999, the aggregate restricted stock holdings
for the named executives consisted of 157,519 shares worth $1,693,329 at the
then current fair market value (as represented by the closing price of the
Company's Common Stock on May 31, 1999), without giving effect to the
diminution of value attributable to the restrictions on such stock. Such
amount includes $150,500 for Mr. Fritz (14,000 shares), $577,178 for Mr.
Pelino (53,691 shares), $210,238 for Mr. Arovas (19,557 shares), $432,827
for Mr. Carnes (40,263 shares) and $322,586 for Mr. Raymond (30,008 shares).
Dividends are paid on the restricted shares to the extent payable on the
Company's Common Stock generally. Except as set forth in footnotes 3, 4 and
6 below, no shares granted to the named executives vest in less than three
years from the date of grant.
(3) Certain restricted stock awarded during 1997($10,500), 1998($8,562) and
1999($7,524) to Mr. Carnes vested upon grant. The remaining restricted stock
awarded to Mr. Carnes during 1997, 1998 and 1999 vested 30% upon grant, with
the balance to vest on January 1, 2001.
(4) The restricted stock awarded during 1998 to Mr. Arovas vested 30% upon
grant, with the balance to vest on January 1, 2000. The restricted stock
awarded during 1999 to Mr. Arovas vested 30% upon grant, with the balance to
vest on January 1, 2000.
(5) Mr. Arovas joined the Company during Fiscal 1997.
(6) Certain restricted stock awarded during 1997($10,500), 1998($8,562) and
1999($46,370) to Mr. Raymond vested upon grant. The remaining restricted
stock awarded to Mr. Raymond during 1997, 1998 and 1999 vested 30% upon
grant, with the balance to vest five years from the date of grant.
(7) During 1999, certain restricted stock grants to Messrs. Raymond and Carnes
became vested and thereupon became subject to withholding taxes. The Company
paid those taxes in cash in lieu of shares.
(8) Mr. Arovas left the Company as of May 31, 1999.
OPTIONS GRANTED TO EXECUTIVE OFFICERS
The following table sets forth certain information regarding stock options
granted during Fiscal 1999 to the executive officers named in the foregoing
Summary Compensation Table.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------------------- POTENTIAL REALIZABLE
NUMBER OF VALUE AT ASSUMED
SECURITIES PERCENT OF ANNUAL RATES OF STOCK
UNDERLYING TOTAL OPTIONS MARKET PRICE APPRECIATION FOR
OPTIONS GRANTED TO EXERCISE OR PRICE ON OPTION TERM(4)
GRANTED EMPLOYEES IN BASE PRICE DATE OF EXPIRATION -----------------------
NAME (#)(1) FISCAL YEAR ($/SH)(2) GRANT(2) DATE(3) 5%($) 10%($)
---- ---------- ------------- ----------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Lynn C. Fritz.......... 250,000 51.47% $9.3125 $9.3125 7/27/08 1,464,145 3,710,432
Dennis L. Pelino....... 30,000 6.18% $9.3125 $9.3125 7/27/08 175,697 445,252
Joseph Carnes.......... 30,000 6.18% $9.3125 $9.3125 7/27/08 175,697 445,252
Robert Arovas.......... 30,000 6.18% $9.3125 $9.3125 7/27/08 175,697 445,252
Jan H. Raymond......... 20,000 4.12% $9.3125 $9.3125 7/27/08 117,132 296,835
</TABLE>
- ---------------
(1) Except as to the options granted to Mr. Arovas, all such options become
exercisable (a) as to 1/3 (33.3%) of the shares on the day after the first
anniversary of the grant, (b) as to an additional 1/3 (33.3%) of the shares
on the day after the second anniversary of the grant, and (e) as to the
remaining 1/3 (33.3%) of the shares on the day after the third anniversary
of the grant. Mr. Arovas' options became exercisable on June 1, 1999. Under
the terms of the Company's stock option plan, the Compensation Committee
retains discretion, subject to plan limits, to modify the terms of
outstanding options.
(2) All options were granted at fair market value.
(3) All options granted in fiscal 1999 were granted for a term of 10 years.
(4) Realizable values are reported net of the option exercise price. The dollar
amounts under these columns are the result of calculations at the 5% and 10%
rates (determined from the price at the date of grant, not
4
<PAGE> 7
the stock's current market value) set by the Securities and Exchange
Commission and therefore are not intended to forecast possible future
appreciation, if any, of the Company's stock price. Actual gains, if any, on
stock option exercises are dependent on the future performance of the Common
Stock as well as the optionholder's continued employment through the vesting
period. The potential realizable value calculation assumes that the
optionholder waits until the end of the option term to exercise the option.
None of the Company's executive officers exercised any stock options during
Fiscal 1999. The following table sets forth certain information with respect to
stock options held by each of the Company's executive officers as of May 31,
1999.
AGGREGATED OPTION EXERCISES IN LAST FLSCAL YEAR
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FY-END(#) AT FY-END($)(1)
---------------------------- ----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Lynn C. Fritz.............................. 186,666 283,334 10,416 380,209
Dennis L. Pelino........................... 435,800 30,000 18,850 43,125
Joseph Carnes.............................. 6,556 43,111 11,289 53,462
Robert Arovas.............................. 8,333 56,667 5,208 53,542
Jan H. Raymond............................. 25,000 32,000 65,625 40,250
</TABLE>
- ---------------
(1) Based on the price per share of $10.75, which was the price of the Common
Stock on the Nasdaq National Market at the close of business on May 31,
1999.
EMPLOYMENT AGREEMENTS
In October 1996, the Company entered into an employment agreement with
Dennis Pelino, which was amended in July 1998. The agreement, which expires on
October 31, 2002, is performance based and provides non-salary compensation in
stock in relationship to the performance goals and objectives of Mr. Pelino. The
terms of the agreement provide Mr. Pelino with an annual base salary of $375,000
and a severance benefit of two years' salary in the event of involuntary
termination without cause.
In January 1999, the Company entered into an employment agreement with
Joseph Carnes. The agreement has no set expiration date. It provides for an
initial annual base salary of $275,000 and a severance benefit of $400,000 in
the event of involuntary termination without cause within the first five years
of employment under the agreement. The agreement also provides for Mr. Carnes to
receive certain restricted stock grants under the Company's Performance Based
Retention Plan.
In January 1999, the Company entered into an employment agreement with Jan
Raymond. The agreement expires on December 31, 2001. It provides for an initial
annual base salary of $240,000 and a severance benefit of the amount of salary
payable over the remainder of the contract term in the event of involuntary
termination without cause during the term of the contract and one year's base
salary in the event of termination due to a change of control of the Company
within one year of such change of control. The agreement also provides for Mr.
Raymond to participate in the Company's Performance Based Retention Plan.
In May 1999, the Company entered into a termination agreement with Robert
Arovas. The agreement provides for a six month period of salary continuation,
accelerated vesting of restricted stock and stock options, an award for Fiscal
1999 under the Company's Performance Based Retention Plan and reimbursement of
relocation costs incurred in connection with Mr. Arovas' joining the Company.
5
<PAGE> 8
TRANSACTIONS WITH THE COMPANY
In connection with the Company's U.S. customs brokerage operations, the
Company's customers are required to obtain surety bonds, The Company places such
customs bonds with Intercargo Corporation ("Intercargo") and other underwriters
of customs bonds. In addition, the Company carries various liability insurance
policies with Intercargo. Lynn Fritz owned approximately 2% of the outstanding
common stock of Intercargo during Fiscal 1999. During Fiscal 1999, Mr. Fritz
liquidated all of his shareholdings in Intercargo. During Fiscal 1999, the
Company placed approximately $4,557,881 of insurance and surety bond business
with Intercargo and received $573,131 in insurance and surety bond commissions
and fees from Intercargo. The Company believes that the amounts received are
substantially the same as the Company would have received from other third
parties.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
To the Board of Directors:
As members of the Compensation Committee, it is our duty to evaluate and
determine the appropriate levels of compensation for officers and directors and
to administer the Company's 1992 Omnibus Equity Incentive Plan and 401(k) Plan.
Our general policy is to discharge these responsibilities in a manner which
links executive performance to long term shareholder value. Our specific
objectives are to enhance the long term performance of the Company, enable the
Company to attract and retain outstanding executives and employees and provide
meaningful incentives, without subjecting the Company to excessive cost.
Competitive Compensation Information
Annually, the Compensation Committee reviews with management competitive
data from recognized national surveys concerning executive compensation levels
and practices as part of the process of establishing an appropriate level of
overall executive compensation. These surveys include some of the companies that
are inlcuded in the Peer Group used by the Company in the comparison of
five-year cumulative total return set forth below, as well as many other
companies not in the Peer Group. The Committee has chosen not to limit the
survey information to companies in the Peer Group because the search to attract
new executives is not limited to companies within the same industry, and the
competition that the Company faces to recruit and retain existing executives
comes from companies in many different industries.
Base Salary
The Compensation Committee approves all salary changes for the Company's
executive officers, and bases decisions with respect to changes in individual
salary on a combination of factors including the performance of the executive,
changes in the responsibilities of the executive, salary level relative to the
competitive market and the recommendations of the Company's Chief Executive
Officer. Mr. Fritz' base salary is $500,000. He has not had an increase to base
salary since the Company went public in 1992. Mr. Fritz has requested of the
Committee that given the operating performance of the Company, his salary not be
increased. The Committee has agreed to Mr. Fritz' request and therefore
determined that no adjustment to base pay was in order for Mr. Fritz.
Bonus
The cash bonus provides an annual reward for exceptional performance which
exceeds expectation. Bonus awards are subject to significant variability
depending on the annual performance of the Company The bonus for the Chief
Executive Officer is based solely on the performance of the Company. In
recognition of the Company's fiscal year performance, no cash bonuses were paid
to any executive officers in respect of Fiscal 1999.
6
<PAGE> 9
Stock Based Incentives
Stock based incentives are used as a means of rewarding executives for
making decisions which lead to substantial growth in stockholder value and for
the perceived long term value of the executive to the Company. No specific
minimum holdings of Fritz stock are required formally; however executives are
encouraged to hold significant stock in the Company.
Stock options and restricted stock are the primary long term incentive
awards for executives. We believe that stock options and restricted stock focus
attention on managing the Company from the perspective of an owner with an
equity stake in the business. In this regard, the Company has approved and
implemented a Performance Based Retention Plan that utilizes restricted stock as
a key element of performance recognition and retention value. Under the current
terms of the Performance Based Retention Plan, awards are made in restricted
stock that vests 30% on the date of grant and 70% on the fifth anniversary of
the date of grant providing the executive is continuously employed by the
Company until the vesting date. In order to better serve the dual purposes of
recognition and retention, effective with awards made in Fiscal 2000, awards
will be made in restricted stock that vests 20% at the date of grant and 20%
annually on the anniversary date of the grant so long as the executive remains
continuously employed by the Company until the vesting date. Mr. Fritz and Mr.
Pelino do not participate in the Performance Based Retention Plan, but the other
named executives do and received awards under the Plan in Fiscal 1999.
The Committee continues to support the leadership that Mr. Fritz brings to
the organization and the importance of his long-term value. In that regard, in
July 1998 the Committee awarded Mr. Fritz a grant of 250,000 market based
nonqualified stock options.
As a matter of policy, the Company believes it is important to retain the
flexibility to maximize the Company's tax deductions. Amendments to Section
162(m) of the Internal Revenue Code have eliminated the deductibility of most
compensation over a million dollars in any given year unless the specifications
outlined in Section 162(m) are met. It will continue to be the policy of this
Committee to consider the impact, if any, of Section 162 (m) on the Company and
to document as necessary specific performance goals in order to seek to preserve
the Company's tax deduction.
The Committee is committed to a goal oriented compensation system based on
how the Company performs. In years when the Company meets its aggressive
business plan, we intend to recognize this achievement with substantial bonus
awards.
Compensation Committee
PRESTON MARTIN
WILLIAM RAZZOUK
July 30, 1999
7
<PAGE> 10
PERFORMANCE GRAPH
The following graph compares the percentage change in the Company's
cumulative total stockholder return on its Common Stock for the period from June
1, 1994 to May 31, 1999 with the cumulative total return of the NASDAQ Market
Index and a peer group index consisting of Air Express International
Corporation, Circle International Group, Inc. and Expeditors International of
Washington, Inc.
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG FRITZ COMPANIES INC.,
NASDAQ MARKET INDEX AND PEER GROUP INDEX
<TABLE>
<CAPTION>
FRITZ COS INC PEER GROUP INDEX NASDAQ MARKET INDEX
------------- ----------------------- -------------------
<S> <C> <C> <C>
'1994' 100.00 100.00 100.00
'1995' 174.38 136.69 109.45
'1996' 228.10 174.04 154.49
'1997' 71.90 259.09 173.33
'1998' 85.95 303.19 220.07
'1999' 71.07 341.60 303.20
</TABLE>
Assumes $100 Invested on June 1, 1994
Assumes Dividend Reinvested
Fiscal Year Ending May 31, 1999
8
<PAGE> 11
OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table indicates, as to (i) each person who is known by the
Company to own beneficially more than 5% of the outstanding shares of Common
Stock, (ii) each director, (iii) each named executive officer, and (iv) all
directors and executive officers as a group, the number of shares and percentage
of the Company's Common Stock beneficially owned as of July 15, 1999.
<TABLE>
<CAPTION>
COMMON STOCK BENEFICIALLY
OWNED AS OF JULY 15, 1999
---------------------------
EXECUTIVE OFFICER OR DIRECTOR NUMBER OF SHARES PERCENT
----------------------------- ---------------- -------
<S> <C> <C>
Lynn C. Fritz(1)............................................ 13,236,196 36.3%
Franklin Resources, Inc..................................... 2,497,900 6.9%
Westport Asset Management, Inc.............................. 2,277,424 6.3%
State of Wisconsin Investment Board......................... 1,969,300 5.4%
Dennis L. Pelino(2)......................................... 499,491 1.4%
Joseph Carnes(3)............................................ 73,540 .2%
Robert Arovas(4)............................................ 96,578 .3%
Jan H. Raymond(5)........................................... 77,285 .2%
James Gilleran.............................................. 9,944 *
Preston Martin.............................................. 13,444 *
Paul S. Otellini............................................ 2,105 *
William J. Razzouk.......................................... 3,505 *
All directors and executive officers as a group (15
persons)(6)............................................... 14,066,611 38.6%
</TABLE>
The address of Mr. Fritz is 706 Mission Street, San Francisco, California 94103.
Mr. Fritz may be deemed to be a "control person," of the Company within the
meaning of the rules and regulations of the Securities and Exchange Commission
by reason of his stock ownership and positions with the Company. The address of
Franklin Resources, Inc. is 777 Mariners Island Boulevard, San Mateo, California
94404; the address of Westport Asset Management is 253 Riverside Avenue,
Westport, Connecticut 06880; and the address of State of Wisconsin Investment
Board is P.O. Box 7842, Madison, Wisconsin 53707.
- ---------------
* Less than 1/10 of 1%
(1) Includes employee stock options exercisable within 60 days to purchase
286,666 shares.
(2) Includes employee stock options exercisable within 60 days to purchase
445,800 shares.
(3) Includes employee stock options exercisable within 60 days to purchase
23,111 shares.
(4) Includes employee stock options exercisable within 60 days to purchase
65,000 shares.
(5) Includes employee stock options exercisable within 60 days to purchase
77,285 shares.
(6) Includes shares which the directors and executive officers have the option
to purchase within 60 days.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than ten-percent shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that, during the period from
June 1, 1998 to May 31, 1999 all filing requirements applicable to its officers,
directors, and greater than ten-percent beneficial owners were complied with.
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AUDITORS
KPMG LLP serves as the Company's principal independent accountants.
Representatives of KPMG LLP will be present at the Annual Meeting with the
opportunity to make a statement if they desire to do so and will be available to
respond to appropriate questions.
OTHER MATTERS
As of the date of this Proxy Statement, there are no other matters which
management intends to present or has reason to believe others will present to
the meeting. If other matters properly come before the meeting, those who act as
proxies will vote in accordance with their judgment.
STOCKHOLDER PROPOSALS
If any stockholder intends to present a proposal for action at the
Company's 2000 Annual Meeting and wishes to have such proposal set forth in
management's proxy statement, such stockholder must forward the proposal to the
Company so that it is received on or before April 22, 2000. Proposals should be
addressed to the Company at 706 Mission Street, San Francisco, California 94103,
Attention: Corporate Secretary.
The attached proxy card grants the proxy holders discretionary authority to
vote on any matter raised at the Annual Meeting. If a stockholder intends to
submit a proposal at the 2000 Annual Meeting of Stockholders of the Company,
which proposal is not intended to be included in the Company's proxy statement
and form of proxy relating to such meeting, the stockholder should give
appropriate notice no later than July 9, 2000. If a stockholder fails to submit
the proposal by such date, the Company will not be required to provide any
information about the nature of the proposal in its proxy statement and the
proxy holders will be allowed to use their discretionary voting authority if the
proposal is raised at the 2000 Annual Meeting of Stockholders of the Company.
COST OF SOLICITATION
All expenses in connection with the solicitation of this proxy, including
the charges of brokerage houses and other custodians, nominees or fiduciaries
for forwarding documents to stockholders, will be paid by the Company.
By Order of the Board of Directors
Jan H. Raymond
Secretary
Dated: August 20, 1999.
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