<PAGE>
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 Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
COPART, 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:
-----------------------------------------------------------------------
(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.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]
COPART, INC.
NOVEMBER 7, 1997
Dear Shareholder:
You are cordially invited to attend the 1997 Annual Meeting of Shareholders
of Copart, Inc. (the "Company") to be held on Tuesday, December 9, 1997 at 9:00
a.m., at the Company's corporate headquarters located at 5500 E. Second Street,
Benicia, CA 94510 (see directions on back of proxy statement). The formal Notice
of Annual Meeting of Shareholders and Proxy Statement accompanying this letter
describes the business to be acted upon.
PLEASE SIGN AND RETURN YOUR PROXY NOW WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING. If you attend the meeting, you may still vote in person even if you
have previously returned a signed proxy.
Sincerely,
[/S/ WILLIS J. JOHNSON]
WILLIS J. JOHNSON
CHIEF EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER
YOUR VOTE IS IMPORTANT
SO THAT YOUR COMMON STOCK WILL BE REPRESENTED AT THE ANNUAL MEETING IN THE EVENT
YOU ARE NOT PERSONALLY PRESENT, PLEASE DATE, SIGN AND RETURN PROMPTLY THE
ENCLOSED PROXY IN THE ENVELOPE PROVIDED. EXECUTION OF THE PROXY WILL NOT AFFECT
YOUR RIGHT TO VOTE IN PERSON IF YOU ARE PRESENT AT THE MEETING.
<PAGE>
COPART, INC.
----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 9, 1997
---------------------
The Annual Meeting of Shareholders (the "Annual Meeting") of Copart, Inc.
(the "Company") will be held on Tuesday, December 9, 1997 at 9:00 a.m. at the
Company's corporate headquarters located at 5500 E. Second Street, Benicia,
California 94510 for the following purposes:
1. To elect seven Directors of the Company for the ensuing year or until
their successors have been elected and qualified;
2. To ratify KPMG Peat Marwick LLP as independent auditors for the Company
for fiscal year 1998;
3. To increase the number of shares reserved under the 1994 Employee Stock
Purchase Plan from 85,000 to 170,000; and
4. To transact such other business as may properly come before the meeting
or any adjournment(s) thereof.
The Board of Directors has fixed the close of business on October 23, 1997,
as the record date for determining shareholders entitled to notice of, and to
vote at, the Annual Meeting. The stock transfer books will not be closed between
the record date and the date of the Annual Meeting.
Please read carefully the following Proxy Statement which describes the
matters to be voted upon at the Annual Meeting, and then complete, sign and
return your Proxy as promptly as possible. Should you receive more than one
Proxy because your shares are registered in different names and addresses, each
Proxy should be signed and returned to assure that all your shares will be
voted. If you attend the Annual Meeting and vote by ballot, your Proxy will be
revoked automatically and only your vote at the Annual Meeting will be counted.
Sincerely,
[/S/ WILLIS J. JOHNSON]
WILLIS J. JOHNSON
CHIEF EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER
<PAGE>
COPART, INC.
5500 E. SECOND STREET
BENICIA, CALIFORNIA 94510
------------------------
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 9, 1997
---------------------
GENERAL
THE ENCLOSED PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
COPART, INC., a California corporation (the "Company"), for use at the Annual
Meeting of Shareholders to be held on Tuesday, December 9, 1997 (the "Annual
Meeting"). The Annual Meeting will be held at 9:00 a.m. at the Company's
corporate headquarters located at 5500 E. Second Street, Benicia, California.
Shareholders of record on October 23, 1997 will be entitled to notice of and to
vote at the Annual Meeting. The Company's principal executive offices are
located at 5500 E. Second St., Benicia, CA 94510. The Company's telephone number
at that address is (707) 748-5000.
The Proxy Statement and accompanying proxy (the "Proxy") and Notice of
Annual Meeting were first mailed to shareholders on or about November 7, 1997.
RECORD DATE, VOTING AND SHARE OWNERSHIP
On October 23, 1997, the record date for determination of shareholders
entitled to vote at the Annual Meeting, there were 13,100,354 shares of Common
Stock outstanding held by 260 shareholders of record. No shares of the Company's
Preferred Stock are outstanding. Every shareholder voting in the election of
directors may cumulate such shareholder's votes and give one candidate a number
of votes equal to the number of directors to be elected (seven) multiplied by
the number of shares held by such shareholder, or distribute such number of
votes on the same principle among as many candidates as the shareholder thinks
fit, provided that votes cannot be cast for more than the number of candidates
to be elected. However, no shareholder shall be entitled to cumulate votes for a
candidate unless such candidate's name has been placed in nomination prior to
the voting and the shareholder, or any other shareholder, has given notice at
the meeting prior to the voting of the intention to cumulate votes. On all other
matters, each share has one vote. Approval of the Board's decision to retain
KPMG Peat Marwick LLP as independent auditors for fiscal 1998 and to amend the
Employee Stock Purchase Plan will be decided by the affirmative vote of a
majority of the shares present or represented and entitled to vote on each such
matter. Abstentions with respect to any matter are treated as shares present or
represented at the Annual Meeting and entitled to vote on that matter and thus
have the same effect as negative votes. If shares are not voted by the broker
who is the record holder of the shares, or if shares are not voted in other
circumstances in which proxy authority is defective or has been withheld with
respect to any matter, these non-voted shares are not deemed to be present or
represented for purposes of determining whether shareholder approval of that
matter has been obtained, although they are deemed to be present for purposes of
establishing a quorum for the transaction of business.
REVOCABILITY OF PROXIES
If you are unable to attend the Annual Meeting, you may vote by Proxy. The
enclosed Proxy is solicited by the Company's Board of Directors and, when
returned properly completed, will be voted as you direct your Proxy. Unless
otherwise instructed in the Proxy, the proxyholder will vote the Proxies
received by them FOR each of the three proposals described herein.
<PAGE>
Any person giving a Proxy has the power to revoke it at any time before its
exercise. It may be revoked by filing with Paul A. Styer, Senior Vice President,
General Counsel and Secretary of the Company at the Company's principal
executive offices, Copart, Inc., 5500 E. Second St., Benicia, California 94510,
a notice of revocation or another signed Proxy with a later date. You may also
revoke your Proxy by attending the Annual Meeting and voting in person.
SOLICITATION
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the Proxy
and any additional soliciting materials furnished to shareholders. Copies of
solicitation materials will be furnished to brokerage houses, fiduciaries, and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
In addition, the Company may reimburse such persons for their costs in
forwarding the solicitation materials to such beneficial owners. The original
solicitation of proxies by mail may be supplemented by solicitation by
telephone, telegram, or other means by Directors, officers, employees or agents
of the Company. No compensation will be paid to these individuals for any such
services. Except as described above, the Company does not presently intend to
solicit proxies other than by mail.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of shareholders of the Company that are intended to be presented
by such shareholders at the Company's 1998 Annual Meeting must be received by
the Company at its principal executive offices no later than July 7, 1998 in
order that they may be considered for inclusion in the proxy statement and form
of proxy relating to that meeting.
2
<PAGE>
MATTERS TO BE CONSIDERED AT ANNUAL MEETING
PROPOSAL ONE -- ELECTION OF DIRECTORS
One of the purposes of the Annual Meeting is to elect directors to hold
office until the next annual meeting or until their respective successors are
elected and have been qualified. The number of authorized Directors is currently
seven. The Board of Directors has selected the seven nominees listed below for
election as Directors. Each person nominated for election has agreed to serve if
elected and Management has no reason to believe that any nominee will be
unavailable to serve. Unless otherwise instructed in the Proxy, the proxy
holders will vote the Proxies received by them FOR the nominees named below. The
seven candidates receiving the highest number of affirmative votes of the shares
entitled to vote at the Annual Meeting will be elected Directors of the Company.
The Board of Directors recommends that the shareholders vote FOR the
election of each of the following nominees to serve as Directors of the Company
for the ensuing year until the next Annual Meeting or until their successors are
elected and qualified.
NOMINEES
Set forth below is information regarding the nominees, all of whom are
currently directors of the Company, including information furnished by them as
to principal occupations, certain other directorships held by them, any
arrangements pursuant to which they were or are selected as Directors or
nominees and their ages as of October 23, 1997:
<TABLE>
<CAPTION>
NAME AGE PRINCIPAL OCCUPATION
- ------------------------------- --- -----------------------------------------------------------------
<S> <C> <C>
Willis J. Johnson (1).......... 50 Chief Executive Officer and Chief Financial Officer of the
Company
Marvin L. Schmidt.............. 53 Senior Vice President of Corporate Development of the Company
A. Jayson Adair................ 28 President of the Company
James Grosfeld (1)(2).......... 60 Independent Investor
Jonathan Vannini (1)(2)........ 35 General Partner, Atlas Partners, L.P.
Harold Blumenstein............. 58 General Partner, Paragon Properties Company
James E. Meeks................. 48 Executive Vice President of the Company
</TABLE>
- ------------------------
(1) Member of the Compensation Committee.
(2) Member of the Audit and Stock Option Grant Committees.
WILLIS J. JOHNSON, co-founder of the Company, has served as Chief Executive
Officer of the Company since 1986, Chief Financial Officer of the Company since
October 1997 and has been a Board member since 1982. Mr. Johnson served as
President of the Company from 1986 until May 1995. Mr. Johnson was an officer
and director of U-Pull-It, Inc (UPI), a self-service auto dismantler which he
co-founded in 1982, from 1982 through September, 1994. Mr. Johnson sold his
entire interest in UPI in September, 1994. Mr. Johnson has over 25 years of
experience in owning and operating auto dismantling companies.
MARVIN L. SCHMIDT has served as Senior Vice President of Corporate
Development since May 1995. Mr. Schmidt served as Vice President of the
Company's Western Region and a director of the Company since July 1993, when he
joined the Company concurrent with the Company's acquisition of County Salvage,
Inc. From January 1989 until July 1993, Mr. Schmidt owned and operated County
Salvage, Inc. in Los Angeles. Mr. Schmidt has over 25 years of experience as an
owner and operator of auto dismantling and parts businesses.
A. JAYSON ADAIR has served as President of the Company since November 1996
and as a director since September 1992. From April 1995 until October 1996, Mr.
Adair served as Executive Vice President. From
3
<PAGE>
August 1990 until April 1995, Mr. Adair served as Vice President of Sales and
Operations and from June 1989 to August 1990, Mr. Adair served as the Company's
Manager of Operations.
JAMES GROSFELD has served as a director since November 1993. From November
1993 until November 1994, Mr. Grosfeld also served as Chairman of the Board of
the Company. Mr. Grosfeld, an independent investor, served as Chairman of the
Board and Chief Executive Officer of Pulte Corporation, a home-building
corporation, from 1974 to 1990. In addition to serving as Co-Chairman of the
Executive Committee, Mr. Grosfeld serves as consultant and director of Pulte
Corporation, and a director of each of the publicly-traded BlackRock Financial
Management funds.
JONATHAN VANNINI has served as a director of the Company since February
1993. Mr. Vannini was a general partner at HPB Associates, an investment
partnership, and was employed by HPB Associates from August 1987 until March,
1996. In March, 1996, Mr. Vannini became a general partner in Atlas Partners,
L.P., an investment partnership. Mr. Vannini holds a B.A. in Economics from the
University of California, Los Angeles and an M.B.A. from Columbia University.
HAROLD BLUMENSTEIN has served as a director of the Company since March 1994.
Mr. Blumenstein is a general partner of Paragon Properties Company, a real
estate development, investment and management company, where he has been
employed since January 1971. Mr. Blumenstein holds a B.A. in Economics and
Accounting from Wayne State University.
JAMES E. MEEKS has served as Vice President and Chief Operating Officer of
the Company since September 1992 when he joined the Company concurrent with the
Company's purchase of South Bay Salvage Pool (the San Martin Operation). Mr.
Meeks has served as Executive Vice President and Director since October 1996 and
as Senior Vice President since April 1995. From April 1986 to September 1992,
Mr. Meeks, together with his family, owned and operated the San Martin
Operation. Mr. Meeks is also an officer, director and part owner of Cas & Meeks,
Inc., a towing and subhauling service company, which he has operated since 1991.
Mr. Meeks has also been an officer and director of E & H Dismantlers, a self-
service auto dismantler, since 1967. Mr. Meeks has over 25 years of experience
in the vehicle dismantling business.
There are no family relationships among any of the directors or executive
officers of the Company, except that A. Jayson Adair is the son-in-law of Willis
J. Johnson.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and officers, and persons who own more than ten percent
of a registered class of the Company's equity securities to file with the SEC
initial reports of ownership and reports of changes in ownership of Common Stock
and other equity securities of the Company. Officers, directors and greater than
ten percent shareholders are required by SEC regulations to furnish the Company
with copies of all Section 16(a) reports they file.
Based solely upon a review of the copies of such reports furnished to the
Company and written representations from such officers, directors and greater
than ten percent shareholders that no other reports were required to be made,
the Company believes that there was full compliance for the fiscal year ended
July 31, 1997 with all Section 16(a) filing requirements applicable to the
Company's officers, directors and greater-than-ten percent shareholders, except
that Paul A. Styer reported exercises of stock options and a sale transaction on
Form 4s which were filed late.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended July 31, 1997, the Board of Directors held four
(4) meetings. As of July 31, 1997, the Company had three standing Committees: an
Audit Committee, Stock Option Grant
4
<PAGE>
Committee and a Compensation Committee. The Company has no nominating committee
or any committee performing similar functions.
The Audit Committee is primarily responsible for approving the services
performed by the Company's independent auditors, reviewing financial statements
of the Company, and reviewing reports of the Company's accounting practices and
systems of internal accounting controls. The Audit Committee currently consists
of Directors Vannini and Grosfeld. The Audit Committee held one meeting during
the last fiscal year.
The Stock Option Grant Committee is responsible for the administration of
the Company's 1992 Stock Option Plan. The Compensation Committee is generally
responsible for, among other things, reviewing and approving the Company's
compensation policies and setting the compensation levels for those Company
executive officers and senior managers reporting directly to the Company's
President whose compensation is not otherwise established pursuant to employment
agreements reviewed or approved by the Board of Directors. The Compensation
Committee consists of Directors Grosfeld, Johnson and Vannini and the Stock
Option Grant Committee consists of Directors Grosfeld and Vannini. The
Compensation Committee and Stock Option Grant Committee each held one (1)
meeting during the last fiscal year.
During the last fiscal year, no director attended fewer than 75% of the
aggregate number of meetings of the Board of Directors and meetings of
Committees of the Board on which he serves that were held during the period for
which he has been a member.
5
<PAGE>
SECURITY OWNERSHIP
The following table sets forth certain information known to the Company
regarding the ownership of the Company's Common Stock as of October 23, 1997 for
(i) each Director and nominee for director, (ii) all persons known by the
Company to be beneficial owners of five percent or more of the Company's Common
Stock, (iii) any other Named Officer (as said term is defined hereinafter in
"Executive Compensation -- Summary of Cash and Certain Other Compensation") and
(iv) all executive officers and Directors of the Company as a group. Unless
otherwise indicated, each of the shareholders has sole voting and investment
power with respect to the shares beneficially owned, subject to community
property laws where applicable, except as otherwise indicated.
<TABLE>
<CAPTION>
NUMBER PERCENT OF TOTAL
NAME AND ADDRESS OF SHARES SHARES OUTSTANDING
- ----------------------------------------------------------------------------- ---------- -------------------------
<S> <C> <C>
FIVE PERCENT SHAREHOLDERS:
Willis J. Johnson............................................................ 2,974,383 22.7%
c/o Copart, Inc.
5500 E. Second Street
Benicia, CA 94510
James Grosfeld............................................................... 1,200,000 9.2%
20500 Civic Center Drive
Southfield, MI 48076
DIRECTORS AND EXECUTIVE OFFICERS:
Willis J. Johnson............................................................ 2,974,383 22.7%
A. Jayson Adair (1).......................................................... 113,381 *
James E. Meeks (2)........................................................... 61,733 *
Marvin L. Schmidt (2)........................................................ 318,200 2.4%
Paul A. Styer (4)............................................................ 47,355 *
Joseph M. Whelan (5)......................................................... 30,695 *
James Grosfeld............................................................... 1,200,000 9.2%
Harold Blumenstein (6)....................................................... 140,000 1.1%
----------
All directors and executive officers listed (eight persons) (7).............. 4,885,747 37.3%
</TABLE>
- ------------------------
* Represents less than 1% of the outstanding Common Stock.
(1) Includes 101,500 shares of Common Stock subject to options exercisable
within 60 days of October 23, 1997.
(2) Includes 50,167 shares of Common Stock subject to options exercisable within
60 days of October 23, 1997.
(3) Includes -0- shares of Common Stock subject to options exercisable within 60
days of October 23, 1997.
(4) Includes 34,666 shares of Common Stock subject to options exercisable within
60 days of October 23, 1997.
(5) Includes 26,583 shares of Common Stock subject to options exercisable within
60 days of October 23, 1997. Mr. Whelan resigned as Senior Vice President
and Chief Financial Officer on October 6, 1997.
(6) Includes 5,500 shares of Common Stock subject to options exercisable within
60 days of October 23, 1997.
6
<PAGE>
EXECUTIVE COMPENSATION
DIRECTORS' COMPENSATION
Non-employee Directors are reimbursed for expenses incurred in attending
Board and Committee meetings. During fiscal year 1997, all non-employee
Directors received quarterly compensation of $2,000.
Each non-employee Director is also eligible to receive periodic option
grants for shares of the Company's Common Stock pursuant to the automatic option
grant program in effect under the Company's 1994 Director Stock Option Plan (the
"Option Plan"). Mr. Grosfeld has waived all rights to receive automatic option
grants under the Option Plan.
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table provides certain summary information concerning the
compensation earned for services rendered in all capacities to the Company and
its subsidiaries during each of the last three fiscal years, by the Company's
CEO and each of the Company's other four most highly compensated executive
officers whose salary and bonus for the 1997 fiscal year was in excess of
$100,000. The individuals whose compensation is disclosed in the following
tables are hereafter referred to as the "Named Officers".
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION AWARDS
ANNUAL COMPENSATION ---------------------------------------
---------------------------------- SECURITIES UNDERLYING ALL OTHER
NAME AND POSITION FISCAL YEAR SALARY($) BONUS($) OPTIONS/SARS(#) COMPENSATION($)
- ----------------------------------------------------- ----------- --------- -------- --------------------- ---------------
<S> <C> <C> <C> <C> <C>
Willis J. Johnson.................................... 1997 236,538 -- -- 16,488(1)
Chief Executive Officer and 1996 225,000 -- -- 22,300(2)
Chief Financial Officer 1995 225,000 -- -- 10,680(3)
A. Jayson Adair...................................... 1997 134,231 -- -- 13,080(4)
President 1996 125,000 -- 20,000 4,800(4)
1995 112,500 -- 12,500 4,800(4)
Paul A. Styer........................................ 1997 156,538 -- -- 6,000(5)
Senior Vice President, General 1996 152,307 -- 10,000 6,000(5)
Counsel, Secretary 1995 150,000 10,000 12,500 6,000(5)
Marvin L. Schmidt.................................... 1997 150,000 -- -- 6,000(5)
Senior Vice President of 1996 150,000 -- -- 6,000(5)
Corporate Development 1995 150,000 -- -- 6,000(5)
Joseph M. Whelan..................................... 1997 140,000 -- -- 3,600(7)
Senior Vice President 1996 137,307 -- 10,000 3,600(7)
Chief Financial Officer (6) 1995 135,000 10,000 12,500 --
</TABLE>
- --------------------------
(1) Comprised of premiums on life insurance policies payable to beneficiaries
designated by Mr. Johnson in the amount of $6,024 and value to Mr. Johnson
of use of Company automobile of $10,464.
(2) Comprised of premiums on life insurance policies payable to beneficiaries
designated by Mr. Johnson in the amount of $7,100 and value to Mr. Johnson
of use of Company automobile of $15,200.
(3) Comprised of premiums on life insurance policies payable to beneficiaries
designated by Mr. Johnson in the amount of $1,500 and value to Mr. Johnson
of use of Company automobile of $9,180.
(4) Comprised of use of Company automobiles.
(5) Comprised of automobile expense allowance of $6,000.
7
<PAGE>
(6) Mr. Whelan resigned from his position as Chief Financial Officer and Senior
Vice President on October 6, 1997.
(7) Comprised of use of Company automobile.
OPTION GRANTS
There were no stock options granted during the 1997 fiscal year.
OPTION EXERCISE AND YEAR-END HOLDINGS
The following table sets forth information concerning exercises of options
during fiscal 1997 and the value of unexercised options held as of the end of
the 1997 fiscal year by the Named Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING OPTIONS IN-THE-MONEY OPTIONS AT
ACQUIRED ON GRANTED(#)(1) FISCAL YEAR-END (2)
EXERCISE VALUE --------------------------- ---------------------------
NAME (#) REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------------------- ----------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Willis J. Johnson....................... -- -- -- -- -- --
A. Jayson Adair......................... -- -- 94,625 37,875 $ 1,691,422 $677,016
Paul A. Styer........................... 5,000 $73,500 31,125 20,375 556,359 364,203
Marvin L. Schmidt....................... -- -- 162,500 -- 2,904,688 --
Joseph M. Whelan........................ -- -- 23,958 23,542 428,249 420,813
</TABLE>
- ------------------------
(1) Market value of underlying securities on the date of exercise, minus the
exercise price.
(2) Market value of underlying securities at fiscal year end (for in-the-money
options only) minus the exercise price.
EMPLOYMENT CONTRACTS
The Company is party to an employment agreement with WILLIS J. JOHNSON,
Chief Executive Officer, which continues through December 31, 1997. Under this
agreement, Mr. Johnson is entitled to a current annual salary of $300,000. The
contract also provides for a performance bonus for each fiscal year as
determined by the Board of Directors of the Company, in which determination Mr.
Johnson excuses himself. Mr. Johnson is entitled to participate in the Company's
benefit plans and is entitled to four weeks paid vacation per year, use of a
Company automobile, and a $1 million life insurance policy with the beneficiary
being designated by Mr. Johnson. The agreement further provides that if Mr.
Johnson's employment is terminated without cause, the Company shall be obligated
to pay Mr. Johnson's current salary through the remainder of the employment
term.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors has general
responsibility for establishing the compensation payable to the Company's
executive officers and other key executives. The Company's Stock Option Plan
Committee has the sole and exclusive authority to administer the Company's 1992
Stock Option Plan under which grants may be made to such individuals. While the
Compensation Committee has responsibility for establishing the level of
compensation payable to the Company's executive officers, the decisions reached
by the Committee with respect to the compensation paid to them for the 1997
fiscal year were to a substantial extent governed by the terms and requirements
of employment agreements that have since terminated.
8
<PAGE>
This report is divided into two parts. Part One is a brief description of
the compensation arrangements in effect for the 1997 fiscal year for the
Executive Officers of the Company, including the Named Officers in the Summary
Compensation Table. Part Two is a discussion of the factors which governed the
compensation payable to the Chief Executive Officer for the 1997 fiscal year.
PART ONE -- EXISTING COMPENSATION ARRANGEMENTS
The compensation arrangements for fiscal 1997 with the Company's other
executive officers were negotiated directly between the Company and such
individuals at the time of their commencement of employment. The Compensation
Committee believes that the salaries and benefits under the current or former
employment agreements with the Company's executive officers are commensurate
with the Company's financial performance to date. During fiscal 1997, employment
agreements between the Company and two executive officers of the Company expired
and such persons are employed on an "at-will" basis. As a result of their
promotions from Executive Vice President to President and Senior Vice President
to Executive Vice President, respectively, the annual base salaries of Mr. Adair
and Mr. Meeks were increased to $180,000 and $165,000, respectively in May 1997.
Additionally, Mr. Styer's base salary was increased to $165,000. The
Compensation Committee intends to review these salary levels on a regular basis
and to make such adjustments to them as it sees fit based on the performance of
the Company and the employee.
While the Stock Option Committee awards stock options to executive officers
in order to align the interests of the executive officers with those of the
shareholders, the Committee believes that stock option grants to the Named
Officers made during the last two fiscal years are adequate and, as a result,
granted no stock options to the Named Officers during fiscal 1997.
PART TWO -- CEO COMPENSATION
Willis J. Johnson, the co-founder of the Company served as President and CEO
from 1986 until May 1995, and has served as CEO since May 1995. Based upon the
Company's improved performance during fiscal year 1997, the Compensation
Committee increased Mr. Johnson's base salary to $300,000 effective May 16,
1997.
The terms of Mr. Johnson's existing employment agreement are described above
in the section entitled "Employment Contracts and Termination of Employment
Agreements". The Compensation Committee believes that the salary and benefits
paid to Mr. Johnson in fiscal 1997 are commensurate with the Company's financial
performance, based upon the growth of the Company's net revenue and number of
vehicles processed. Any bonus compensation recommended by the Compensation
Committee to be payable to Mr. Johnson in future years will be based upon
Company growth and financial performance, and subject to approval by the Board
of Directors, excluding Mr. Johnson.
TAX LIMITATION. As a result of federal tax legislation, a publicly-held company
such as the Company will not be allowed a federal income tax deduction for
compensation paid to certain executive officers, to the extent that compensation
exceeds $1 million per officer in any fiscal year. The Company intends to
structure its future compensation packages in a manner to comply with the $1
million compensation cap.
Compensation Committee
Willis J. Johnson James Grosfeld Jonathan Vannini
Stock Option Committee
James Grosfeld Jonathan Vannini
9
<PAGE>
PERFORMANCE GRAPH
The following graph shows a comparison of the cumulative total shareholder
returns for the Company, the Nasdaq Stock Market - US Companies Index and the
Nasdaq, American Stock Exchange, and New York Stock Exchange SIC Peer Group
5010-5019 Index (Motor Vehicle and Automotive Equipment) for the period of March
17, 1994, the date the Company's Common Stock commenced trading on the Nasdaq
National Market, through July 31, 1997.
COMPARISON OF CUMULATIVE TOTAL RETURN (*)
AMONG NASDAQ STOCK MARKET - US COMPANIES INDEX
NASDAQ STOCK MARKET, AMERICAN STOCK EXCHANGE
AND NEW YORK STOCK EXCHANGE SIC PEER GROUP 5010 - 5019 INDEX,
AND COPART, INC. (CPRT)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DOLLARS COPART, INC. PEER GROUP NASDAQ STOCK MARKET - US
<S> <C> <C> <C>
3/14/94 100 100 100
7/94 100 90 91
7/95 158 75 126
7/96 123 79 138
7/97 138 94 203
</TABLE>
* $100 invested on 3/17/94 in stock or index including reinvestment of
dividends. Fiscal years ending July 31.
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, which might incorporate future filings made by
the Company under those statutes, the preceding Compensation Committee Report on
Executive Compensation and Performance Graph are not to be incorporated by
reference into any of those previous filings; or is such report or graph to be
incorporated by reference into any future filings which the Company may make
under those statutes.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee are Willis J. Johnson, James
Grosfeld, and Jonathan Vannini. Except for Willis J. Johnson, who serves as CEO,
none of these individuals was at any time during the fiscal year ended July 31,
1997 or at any other time an officer or employee of the Company.
No executive officer of the Company serves as a member of the board of
directors or compensation committee of any entity which has one or more
executive officers serving as a member of the Company's Board of Directors or
Compensation Committee.
10
<PAGE>
CERTAIN TRANSACTIONS
James E. Meeks, an executive officer of the Company, owns an interest in Cas
& Meeks, a towing service, which supplied approximately $380,300 in transport
services to the Company in fiscal 1997. The Company believes that these services
were provided on terms no less favorable to the Company than could be obtained
from unaffiliated third parties. On October 20, 1995, the Company loaned Mr.
Meeks the sum of $95,000 bearing interest at 8% per annum, payable in annual
installments of $23,750, with the balance payable at the end of four years. The
loan was made to assist Mr. Meeks in re-locating his personal residence closer
to the Company's corporate headquarters. The October 20, 1996 payment of $31,500
(principal and accrued interest) was forgiven by the Company and accounted for
as additional compensation expense.
Willis J. and Reba J. Johnson are the owners of the real property and
improvements of the Fresno, California facility and lease said premises to the
Company for current monthly lease payments of $7,400 under a lease dated August
1, 1992, which expires, with inclusion of all extension options, in July 2000,
and contains a provision whereby the Company has an option to purchase the real
property and improvements. Total payments under this lease aggregated $71,259 in
fiscal 1997. The Company believes that the terms of this lease are no less
favorable to the Company than could be obtained from unaffiliated third parties.
Under the terms of a lease agreement effective July 1, 1993 between the
Schmidt Family Trust dated September 29, 1982 (the "Schmidt Trust") and the
Company, the Company leases property in the Los Angeles, California, area from
the Schmidt Trust (the "Los Angeles Lease"). The term of the Los Angeles Lease
is five years, expiring June 30, 1998 and for a second five-year period
following the expiration of the extended term. Until June 30, 1998, the annual
rent under the Los Angeles Lease is $55,100, payable monthly in equal
installments. Marvin L. Schmidt, the Company's Senior Vice President of
Corporate Development and a Director, is a beneficiary of the Schmidt Trust.
PROPOSAL TWO -- RATIFICATION OF INDEPENDENT AUDITORS
The Company is asking the shareholders to ratify the selection of KPMG Peat
Marwick LLP as the Company's independent auditors for the fiscal year ending
July 31, 1998.
In the event the shareholders fail to ratify the appointment, the Board of
Directors will reconsider its selection. Even if the selection is ratified, the
Board in its discretion may direct the appointment of a different independent
accounting firm at any time during the year if the Board feels that such a
change would be in the best interests of the Company and its shareholders.
KPMG Peat Marwick LLP were auditors for the years ended July 31, 1994, 1995,
1996 and 1997 and have been recommended to the shareholders for ratification as
auditors for the year ending July 31, 1998. A representative of KPMG Peat
Marwick LLP is expected to be present at the Annual Meeting, will have the
opportunity to make a statement if he desires to do so, and will be available to
respond to appropriate questions.
The Board of Directors recommends that the shareholders vote FOR the
ratification of the selection of KPMG Peat Marwick LLP to serve as the Company's
independent auditors for the fiscal year ending July 31, 1998.
PROPOSAL THREE -- APPROVAL OF AMENDMENT TO THE
1994 EMPLOYEE STOCK PURCHASE PLAN
The 1994 Employee Stock Purchase Plan ("Purchase Plan") was amended by the
Board of Directors in October 1997 to reserve an additional 85,000 shares of
Common Stock for issuance thereunder, bringing the total number of shares under
the Purchase Plan to 170,000.
11
<PAGE>
The Company believes that its Purchase Plan is an important factor in
attracting and retaining skilled personnel. Each year the Company reviews the
number of shares available for issuance under the Purchase Plan and, based on
the Company's estimates of the number of shares expected to be purchased under
the Purchase Plan during the coming year, management presents to the Board of
Directors a recommendation whether or not to increase the number of shares to
the pool reserved for issuance under the Purchase Plan. The Board then reviews
this recommendation and presents a proposal such as this one to the stockholders
for approval.
The initial offering period under the Purchase Plan began on March 16, 1994,
and from that date to October 23, 1997, 59,019 shares of the Company's Common
Stock have been sold under the Purchase Plan. The number of shares sold in each
offering period will vary with the number of participants, the amount of their
payroll deductions and the fair market value of the Company's Common Stock.
The Board of Directors recommends that the shareholders vote FOR approval of
the Purchase Plan as amended, including the addition of shares to the pool
reserved for issuance thereunder.
The essential features of the Purchase Plan are outlined below.
GENERAL
The Purchase Plan, and the right of participants to make purchases
thereunder, is intended to qualify under the provisions of Sections 421 and 423
of the Tax Code. See "Tax Information" below.
PURPOSE
The purpose of the Purchase Plan is to provide employees of the Company with
an opportunity to purchase Common Stock of the Company at a discount through
accumulated payroll deductions.
ADMINISTRATION
The Purchase Plan is administered by the Board of Directors or a committee
of members of the Board appointed by the Board, who receive no separate
additional compensation for such service. All questions of interpretation or
application of the Purchase Plan are determined by the Board or its appointed
committee, whose decisions are final and binding upon all participants. Members
of the Board who are eligible employees are permitted to participate in the
Purchase Plan but may not vote on any matter affecting the administration of the
Purchase Plan or the grant of any option pursuant to the Purchase Plan.
ELIGIBILITY
Any person who is customarily employed at least 20 hours per week and 5
months per calendar year by the Company during the applicable offering period is
eligible to participate in the Purchase Plan, unless the employee would own 5%
or more of the total combined voting power or value of all classes of stock of
the Company or of its subsidiaries (including stock issuable upon exercise of
options held by him) at the end of the offering period, or the employee would
receive more than $25,000 worth of stock (computed as of the date of grant)
pursuant to the Purchase Plan in any calendar year. Participation in the
Purchase Plan is voluntary and is dependent on each eligible employee's election
to participate and his or her respective determination as to the level of
payroll deductions. Accordingly, future purchases under the Purchase Plan are
not determinable. No purchases have been made under the Purchase Plan since the
adoption of the Amendment by the Board.
The following schedule summarizes the employees who participated in the
Purchase Plan and shows: (i) the number of shares of the Company's Common Stock
purchased under the Purchase Plan during the last fiscal year; (ii) the dollar
value of the benefit; and (iii) the amount of payroll deductions for future
purchases accumulated through July 31, 1997:
12
<PAGE>
AMENDED PLAN BENEFITS
EMPLOYEE STOCK PURCHASE PLAN
LAST FISCAL YEAR
<TABLE>
<CAPTION>
PAYROLL
NUMBER OF DEDUCTIONS
SHARES DOLLAR AS OF
NAME OF INDIVIDUAL OR PURCHASED VALUE FISCAL
IDENTITY OF GROUP AND POSITION (#) ($)(1) YEAR-END
- ------------------------------------------------------------------------ ----------- --------- -----------
<S> <C> <C> <C>
Willis J. Johnson, Chief Executive Officer, Chief Financial Officer and
Director.............................................................. -- -- --
Jayson Adair, President and Director.................................... -- -- --
Paul A. Styer, Senior Vice President, General Counsel and Secretary..... -- -- --
Marvin L. Schmidt, Senior Vice President of Corporate Development....... -- -- --
Joseph M. Whelan, Senior Vice President and Chief Financial Officer
(2)................................................................... 1,263 $ 4,454 $ 1,077
----------- --------- -----------
All current executive officers as a group (5 persons)................... 1,263 $ 4,454 $ 1,077
All other current employees as a group.................................. 26,234 $ 91,110 $ 21,784
</TABLE>
- ------------------------
(1) Market value of shares on date of purchase, minus the purchase price under
the Purchase Plan.
(2) Mr. Whelan resigned as Senior Vice President and Chief Financial Officer on
October 6, 1997.
At the Record Date, the Company employed approximately 1,040 people, 792 of
whom were eligible to participate in the Purchase Plan. Approximately, 124
employees were participating in the Purchase Plan as of that date.
OFFERING DATES
The Purchase Plan is generally implemented by one offering during each
six-month period. Offering periods commence on or about January 1 and July 1 of
each year.
ENROLLMENT IN THE PLAN
Eligible employees become participants in the Purchase Plan by delivering to
the Company's payroll office a subscription agreement authorizing payroll
deductions. Employees hired after the first day of an offering period (or who
otherwise become eligible after such date) may begin participation in the
Purchase Plan on the first business day of the calendar month following the
month in which they are hired (or become eligible). Under the Purchase Plan,
once an employee elects to participate in the Purchase Plan, enrollment in each
successive offering period occurs automatically unless the employee withdraws
from participation in the Purchase Plan.
PURCHASE PRICE
The purchase price per share under the Purchase Plan is the lower of (i) 85%
of the fair market value of a share of Common Stock on the date of commencement
of the offering (or for employees beginning participation later, the date such
participation began) or (ii) 85% of the fair market value of a share of Common
Stock of the last day of the offering period. The fair market value of the
Common Stock on a given date is the closing sale price on The Nasdaq National
Market.
13
<PAGE>
PAYMENT OF PURCHASE PRICE; PAYROLL DEDUCTIONS
The purchase price of the shares is accumulated by after-tax payroll
deductions over the offering period. The deductions may not exceed 10% of a
participant's compensation. The total number of shares purchased by any
participant shall in no event exceed, in any calendar year, the number of shares
of Common Stock which $25,000 could purchase at the fair market value of a share
of the Company's Common Stock, calculated as of the offering date. A participant
may discontinue participation in the Purchase Plan, and may decrease but not
increase the rate of payroll deductions, during the offering period.
PURCHASE OF STOCK; EXERCISE OF OPTIONS
By executing a subscription agreement to participate in the Purchase Plan,
the employee is entitled to have shares placed under option to him. The maximum
number of shares placed under option to a participant in an offering is that
number determined by dividing the total amount of the participant's contribution
for the offering period by the lower of (i) 85% of the fair market value of the
Common Stock at the beginning of the offering period (or date his participation
began) or (ii) 85% of the fair market value of the Common Stock at the end of
the offering period, but in no event shall more than the number of shares of
Common Stock which $25,000 could purchase at the fair market value of a share of
the Company's Common Stock, calculated as of the offering date, be placed under
option to a single participant in any one calendar year. Unless the employee's
participation is discontinued, the option for the purchase of shares will be
exercised automatically at the end of the offering period at the applicable
price. No fractional shares will be issued upon exercise of the option. Any
amounts insufficient to purchase a full share remaining in a participant's
account after exercise of the option will be returned to the participant. No
interest will accrue on the payroll deductions of a participant in the Purchase
Plan.
WITHDRAWAL
A participant's interest in a given offering may be terminated by signing
and delivering to the Company a notice of withdrawal from the Purchase Plan.
Upon withdrawal from the Purchase Plan, accrued but unused payroll deductions
are returned to the employee. Such withdrawal may be elected at any time prior
to the end of the applicable six-month offering period. A participant's
withdrawal from an offering will not have any effect upon such participant's
eligibility to participate in subsequent offering periods under the Purchase
Plan.
TERMINATION OF EMPLOYMENT
Termination of a participant's employment for any reason, including
retirement or death, cancels participation the Purchase Plan immediately. In
such event the payroll deductions credited to the participant's account will be
returned without interest to such participant, or, in the case of death, to the
person or persons entitled thereto as specified by the employee in the
subscription agreement.
CAPITAL CHANGES
In the event of changes in the capitalization of the Company, such as stock
splits or stock dividends, which result in an increase or decrease in the number
of shares of Common Stock without receipt of consideration by the Company,
appropriate adjustments will be made by the Company in the number of shares
subject to purchase and in the price per share.
EFFECT OF LIQUIDATION, DISSOLUTION, SALE OF ASSETS OR MERGER
In the event of a liquidation or dissolution of the Company, an employee's
participation in the Purchase Plan will be terminated immediately before
consummation of such event unless otherwise provided by the Board. In the event
of a sale of all or substantially all of the assets of the Company or a
14
<PAGE>
merger of the Company with or into another corporation, the employee's rights
may be satisfied by assumption of the Company's obligations by such acquiring or
successor corporation. If such corporation refuses to assume those obligations,
the Board shall allow the immediate exercise of the employee's rights for 30
days, after which the employee's rights under the Purchase Plan shall terminate.
NON-ASSIGNABILITY
No rights or accumulated payroll deductions of an employee under the
Purchase Plan may be pledged, assigned or transferred for any reason, and any
such attempt may be treated by the Company as an election to withdraw from the
Purchase Plan.
REPORTS
Individual accounting will be maintained for each participant in the
Purchase Plan. Each participant receives as promptly as practicable after the
end of the six-month offering period a report showing the details of the
participant's account.
AMENDMENT AND TERMINATION OF THE PLAN
The Board may at any time amend, alter, suspend or discontinue the Purchase
Plan, but, except under certain conditions, no amendment, alteration, suspension
or discontinuation shall be made which would impair the rights of any
participant arising out of any offering period which has already commenced
without such participant's written consent. In addition, to the extent necessary
and desirable to comply with Rule 16b-3 under the Exchange Act or with Section
423 of the Tax Code (or any other applicable law or regulation, including the
requirements of the NASD or an established stock exchange), the Company shall
obtain stockholder approval of any Purchase Plan amendment in such a manner and
to such a degree as required.
TAX INFORMATION
The Purchase Plan, and the right of participants to make purchases
thereunder, is intended to qualify under the provisions of Sections 421 and 423
of the Tax Code. Under these provisions, no income will be taxable to a
participant until the shares purchased under the Plan are sold or otherwise
disposed of. Upon sale or other disposition of the shares, the participant will
generally be subject to tax and the amount of the tax will depend upon the
holding period. If the shares are sold or otherwise disposed of more than two
years from the first day of the offering period, the participant will recognize
ordinary income measured as the lesser of (a) the excess of the fair market
value of the shares at the time of such sale or disposition over the purchase
price, or (b) an amount equal to 15% of the fair market value of the shares as
of the first day of the offering period. Any additional gain will be treated as
long-term capital gain. If the shares are sold or otherwise disposed of before
the expiration of this holding period, the participant will recognize ordinary
income generally measured as the excess of the fair market value of the shares
on the date the shares are purchased over the purchase price. Any additional
gain or loss on such sale or disposition will be long-term or short-term capital
gain or loss, depending on the holding period. The Company is not entitled to a
deduction for amounts taxed as ordinary income or capital gain to a participant
except to the extent of ordinary income recognized by participants upon a sale
or disposition of shares prior to the expiration of the holding period(s)
described above.
The foregoing is only a summary of the effect of federal income taxation
upon the participant and the Company with respect to the shares purchased under
the Purchase Plan, does not purport to be complete, and reference should be made
to the applicable provisions of the Tax Code. In addition, this summary does not
discuss the tax consequences of a participant's death or the income tax laws of
any municipality, state or foreign country in which the participant may reside.
15
<PAGE>
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting. If any
other matters properly come before the meeting, it is the intention of the
persons named in the enclosed form of Proxy to vote the shares they represent as
the Board of Directors may recommend. Discretionary authority with respect to
such other matters is granted by the execution of the enclosed Proxy.
THE BOARD OF DIRECTORS OF COPART, INC.
DATED: November 7, 1997
SITE OF THE 1997 ANNUAL SHAREHOLDER MEETING
DIRECTIONS TO: COPART SALVAGE AUTO AUCTIONS
5500 E. SECOND STREET
BENICIA, CALIFORNIA 94510
FROM: SAN FRANCISCO AIRPORT
Exit the airport on Highway 101 Northbound toward San Francisco. As you enter
San Francisco follow the signs directing you towards the Bay Bridge. This is
Interstate 80 Eastbound. Follow Interstate 80 over the Bay Bridge and continue
Eastbound on Interstate 80. When you reach the other side of the Bay Bridge stay
in the left lanes. Follow Interstate 80 approximately 15 miles to the Carquinez
Bridge. After crossing the Carquinez Bridge, exit onto Interstate 780 towards
Benicia. Follow 780 approximately 7 miles, get in the left lane and make a left
turn onto 680 Eastbound towards Sacramento. The second exit is Lake Herman Rd.
Turn left over freeway and make the first left turn onto East Second, then go to
the first building on the left at 5500 E. Second Street.
16
<PAGE>
COPART, INC.
Proxy for 1997 Annual Meeting of Shareholders
December 9, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
P The undersigned shareholder of Copart, Inc. (the "Company") hereby
R revokes all previous proxies and appoints Willis J. Johnson or Paul A.
O Styer or either of them, with full power of substitution, as the proxy
X of the undersigned to vote and otherwise represent all of the shares
Y registered in the name of the undersigned at the 1997 Annual Meeting of
Shareholders of the Company to be held on Tuesday, December 9, 1997 at
9:00 a.m., at the Company's corporate headquarters located at 5500 E.
Second Street, Second Floor, Benicia, California, and any adjournment
thereof, with the same effect as if the undersigned were present and
voting such shares on the following matters and in the following manner
set forth on the reverse side.
SEE REVERSE
CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
<PAGE>
/ X /Please mark
votes as in
this example.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATIONS MADE. IF NO SPECIFICATION IS MADE, THE SHARES REPRESENTED BY
THIS PROXY WILL BE VOTED FOR EACH OF THE PERSONS AND PROPOSALS BELOW, AND FOR
SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING AS THE
PROXYHOLDERS DEEM ADVISABLE.
<TABLE>
<S> <C>
FOR AGAINST ABSTAIN
1. Election of Directors 2. Approval of the Board of / / / / / /
NOMINEES: WILLIS J. JOHNSON; MARVIN L. SCHMIDT; Directors' selection of
A. JAYSON ADAIR; JAMES GROSFELD; JAMES E. MEEKS; KPMG Peat Marwick LLP as
JONATHAN VANNINI; HAROLD BLUMENSTEIN. independent auditors for
FOR WITHHELD MARK HERE the Company for the current
/ / / / IF YOU PLAN / / fiscal year ending July 31, 1998.
TO ATTEND
THE MEETING FOR AGAINST ABSTAIN
3. Approval to increase the / / / / / /
MARK HERE number of shares reserved
FOR ADDRESS / / for issuance in the 1994
CHANGE AND Employee Stock Purchase Plan
NOTE BELOW from 85,000 shares to 170,000
/ / --------------------------------------- shares.
For all nominees except as noted above
and, in their discretion, upon such other matters
which may properly come before the Annual Meeting
or any adjournments thereof.
TO ASSURE YOUR REPRESENTATION AT THE ANNUAL MEETING,
PLEASE MARK, SIGN AND DATE THIS PROXY AND RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE.
Sign exactly as your name(s) appears on your stock certificate.
A corporation is requested to sign its name by its President or
other authorized officer, with the office held designated.
Executors, administrators, trustees, etc. are requested to so
indicate when signing. If stock is registered in two names,
both should sign.
Signature: Date: Signature: Date:
------------------------- ------------ --------------------------------- -----------
</TABLE>
