SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| 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 ss.240.14a-11(c) or ss.240.14a-12
BEDFORD PROPERTY INVESTORS, INC.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No Fee Required
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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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):
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5. Total fee paid:
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|_| 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 number, or
the Form or Schedule and the date of its filing.
1. Amount previously paid:
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<PAGE>
Dear Stockholder:
The directors and officers join me in extending to you a cordial invitation to
attend our annual meeting of stockholders. This meeting will be held on
Thursday, May 18, 2000 at 1:00 p.m. at the Soda Activity Center at St. Mary's
College, 1928 St. Mary's Road, Moraga, California. There is a map to St. Mary's
College on the last page of this proxy.
Enclosed please find the Notice of Meeting, Proxy Statement and Proxy Card. At
this Meeting we are seeking to elect five directors, all of whom will be elected
by the Stockholders, voting as a single class. Stockholders will also be asked
to ratify the appointment of KPMG LLP as the Company's independent public
accountants for the upcoming year.
Your management and Board of Directors unanimously recommend that you vote FOR
all nominees for directors and FOR the other proposal.
Please take time to review and vote on each proposal. Your vote is important.
Please remember to return your Proxy Card or to vote by Internet or telephone
voting.
I hope to see you at the Annual Meeting.
Very truly yours,
Peter B. Bedford
Chairman of the Board and Chief Executive Officer
<PAGE>
BEDFORD PROPERTY INVESTORS, INC.
270 Lafayette Circle
Lafayette, CA 94549
-----------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 18, 2000
-----------
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of Bedford Property Investors, Inc., a
Maryland corporation (the "Company"), will be held at the Soda Activity Center
at St. Mary's College, 1928 St. Mary's Road, Moraga, California, on Thursday,
May 18, 2000 at 1:00 p.m. local time, to consider the following proposals:
1. Election by the holders of Common Stock of five directors to serve
until the next annual meeting of stockholders and until their
successors are duly elected and qualified;
2. To ratify the appointment by the Board of Directors of the Company's
independent public accountants for the year ending December 31,
2000; and
3. To transact such other business as may properly come before the
meeting.
Only stockholders of record at the close of business on March 31, 2000 are
entitled to notice of and to vote at the meeting and any adjournment or
postponement thereof.
STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON. THE
PRESENCE AT THE MEETING, IN PERSON OR BY PROXY, OF STOCK HOLDERS ENTITLED TO
CAST A MAJORITY OF ALL THE VOTES ENTITLED TO BE CAST AT THE MEETING SHALL
CONSTITUTE A QUORUM. THIS PROXY STATEMENT IS ACCOMPANIED BY A PROXY CARD. IF YOU
CANNOT ATTEND THE MEETING, PLEASE (1) COMPLETE, DATE, SIGN AND RETURN THE PROXY
CARD IN THE ENCLOSED ENVELOPE, OR (2) CALL THE 800 TOLL-FREE NUMBER LISTED ON
THE PROXY CARD, OR (3) VOTE VIA THE INTERNET AS INDICATED ON THE PROXY CARD.
By Order of the Board of Directors
DENNIS KLIMMEK
Secretary
April 10, 2000
Lafayette, California
<PAGE>
BEDFORD PROPERTY INVESTORS, INC.
270 Lafayette Circle
Lafayette, CA 94549
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PROXY STATEMENT
-----------
May 18, 2000
Annual Meeting of Stockholders
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors (the "Board of Directors" or the "Board") of Bedford
Property Investors, Inc., a Maryland corporation (the "Company"), of proxies
from the holders (the "Common Stockholders") of the Company's issued and
outstanding shares of Common Stock, par value $.02 per share (the "Common
Stock"), to be exercised at the Annual Meeting of Stockholders to be held on
Thursday, May 18, 2000 at 1:00 p.m., local time, and at any adjournment(s) or
postponement(s) of such meeting (the "Annual Meeting"), for the purposes set
forth in the accompanying Notice of Annual Meeting of Stockholders.
The purpose of the Annual Meeting is to consider and act upon the
following proposals:
1. Election by the holders of Common Stock of five directors to serve
until the next annual meeting of stockholders and until their
successors are duly elected and qualified;
2. To ratify the appointment by the Board of Directors of the Company's
independent public accountants for the year ending December 31,
2000; and
3. To transact such other business as may properly be brought before
the Annual Meeting.
This Proxy Statement and the enclosed Proxy Card are being mailed to the
Common Stockholders on or about April 10, 2000.
The holders of record of the shares of Common Stock at the close of
business on March 31, 2000 (the "Record Date") are entitled to notice of and to
vote at the Annual Meeting in relation to proposals 1 and 2, above, on which
they will vote as a class. At the close of business on the Record Date,
18,620,056 shares of Common Stock were outstanding (the "Outstanding Stock"),
each of which is entitled to cast one vote.
The presence at the Annual Meeting, in person or by proxy, of Common
Stockholders holding shares entitled to cast a majority for each proposal of all
the votes entitled to be cast at the Annual Meeting shall constitute a quorum
for the transaction of business at the Annual Meeting. Abstentions and broker
non-votes (i.e., votes not cast by a broker or other record holder in "street"
or nominee name solely because such record holder does not have discretionary
authority to vote on the matter) will be counted toward the presence of a
quorum. The directors (Proposal 1) will be elected by a plurality of all the
votes cast at the Annual Meeting. Accordingly, abstentions as to the election of
directors will not affect the election of the candidates receiving the plurality
of votes. The affirmative vote of a majority of all the votes cast by holders of
Common Stock is necessary for ratification of the appointment of independent
public accountants for the fiscal year ending December 31, 2000 (Proposal 2).
Abstentions as to this proposal will not be counted as votes cast and will have
no effect on the result of the vote on this proposal.
Under the Maryland General Corporation Law ("MGCL"), holders of shares of
Outstanding Stock will not be entitled to appraisal rights with respect to such
shares with respect to any of the proposals.
All expenses in connection with the solicitation of proxies will be
borne by the Company. In addition to solicitation
<PAGE>
by mail, officers and directors of the Company may also solicit proxies by mail,
telephone, facsimile or in person. Additionally, the Company may retain the
services of a professional proxy solicitation firm to assist in the solicitation
of proxies, at a cost of approximately $5,000 plus expenses, which would be
borne by the Company.
This proxy statement is accompanied by a proxy card for use by the Common
Stockholders. The shares of Common Stock represented by properly executed proxy
cards will be voted at the Annual Meeting as indicated or, if no instruction is
given, in favor of proposals 1 and 2. The Company does not presently know of any
other business which may come before the Annual Meeting. Any person giving a
proxy has the right to revoke it at any time before it is exercised (a) by
filing with the Secretary of the Company a duly signed revocation or proxy
bearing a later date or (b) by voting in person at the Annual Meeting.
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
The Company's Board of Directors is currently composed of six members with
the death of Director Tom Eastman. Claude Ballard is retiring as a director, and
the Board has approved reducing the number of directors to five pursuant to the
Company's Bylaws. Accordingly, the Common Stockholders, voting as a class, have
the right to elect all five members to the Board of Directors to serve until the
next annual meeting of Common Stockholders and until their respective successors
are duly elected and qualified.
The Board of Directors has nominated the five individuals listed below to
serve as directors of the Company. Management knows of no reason why any of
these nominees would be unable or unwilling to serve, but if any nominee should
be unable or unwilling to serve, the proxies will be voted for the election of
such other persons for the office of director as management may recommend in the
place of such nominee.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMMON STOCKHOLDERS VOTE "FOR"
THE FIVE NOMINEES LISTED BELOW.
<TABLE>
<CAPTION>
Name Age Business Experience During Past Five Years Director Since
- ---- --- ------------------------------------------ --------------
<S> <C> <C>
Peter B. Bedford 62 Mr. Bedford has been Chairman of the Board since 1991
May 1992 and Chief Executive Officer since
November 1992. Mr. Bedford has been engaged in the
commercial real estate business, primarily in the
Western United States, for over 36 years and has been
responsible for the acquisition, ownership, development
and management of an aggregate of approximately
19 million square feet of industrial, office and retail
properties, as well as land, in 14 states. Mr. Bedford
serves on the board of directors of Bixby Ranch
Company, a real estate investment company; eVAULT, a
data storage company; and First American Title
Guarantee Co., a title insurance company. Mr. Bedford
is the recipient of numerous awards recognizing his
contributions to the real estate industry and serves as
a governor of the Urban Land Foundation and an overseer
of the Hoover Institution. His previous experience also
includes serving as Vice Chairman of the National
Realty Committee and of the Hoover Institution and as
Chairman of the Real Estate Advisory Board of the
Wharton School of Business. Mr. Bedford received his
B.A. in Economics from Stanford University.
Anthony Downs 69 Mr. Downs is a Senior Fellow at The Brookings 1992
Institution, a non-profit policy research organization.
Mr. Downs serves on the Board of Directors of each
General Growth Properties, Inc., a REIT; Massachusetts
Mutual Life Insurance Co.; the Urban Institute; the
NAACP Legal and Educational Defense Fund, Inc.; the
National Housing Partnership Foundation, a developer of
low-income housing; the Urban Land Institute;
Counselors of Real Estate; and Penton Media, Inc.
Mr. Downs received a B.A. in International Relations
and Political Theory from Carleton College and an M.A.
and Ph.D. in Economics from Stanford University.
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Anthony M. Frank 68 Mr. Frank served as Postmaster General of the United 1992
States from 1988 to 1992 and as Chairman and Chief
Executive Officer of First Nationwide Bank from 1971 to
1988. Prior to that time, he was Chairman of the
Federal Home Loan Bank of San Francisco, Chairman of
the California Housing Finance Agency, Chairman of
Independent Bancorp of Arizona, and the first Chairman
of the Federal Home Loan Mortgage Corporation Advisory
Board. Currently, he is Chairman of Acrogen, Inc., a
biotechnology company; Chairman of Belvedere Capital
Partners; and serves on the Board of Directors of
Crescent Real Estate Equities, a REIT; Charles Schwab &
Co., a brokerage firm; Temple-Inland, Inc., a forest
products company; General American Investors
Company, Inc., a publicly-traded closed-end investment
fund; and Cotelligent, Inc., an information technology
services company. Mr. Frank received a B.A. from
Dartmouth College and an M.B.A. from the Tuck School of
Business at Dartmouth.
Thomas H. Nolan, Jr. 42 Mr. Nolan is a Managing Director of AEW Capital 1995
Management, L.P. (AEW), a national real estate
investment adviser. Mr. Nolan joined AEW in 1984.
Mr. Nolan's responsibilities include the oversight of
investments made by certain partnerships managed by
AEW. In that capacity he serves on a number of Boards
of private companies and has formerly served on the
Board of Directors of Crocker Trust, Inc., a REIT, and
the Partnership Committee of the Taubman Realty Group
L.P. Mr. Nolan earned a B.B.A. in Business
Administration from the University of Massachusetts.
Martin I. Zankel, Esq. 66 Mr. Zankel has been a Director of the Company since 1992
May 1992. He is Senior Principal in the law firm of
Bartko, Zankel, Tarrant & Miller. In addition,
Mr. Zankel has more than 35 years experience as a real
estate investor and developer, including President of
Independent Holdings, Inc., a real estate development
company; Chairman of the Board and Chief Executive
Officer of Landsing Pacific Fund, Inc., a REIT (ASE);
and Managing Member of ZORO, LLC, a developer of San
Francisco multimedia real estate facilities. Mr. Zankel
is the Chairman of the Board of trustees of the
Berkeley Repertory Theater. He received a B.S. in
Economics from the Wharton School of Commerce and
Finance at the University of Pennsylvania and a J.D.
from the Hastings College of the Law at the University
of California in San Francisco.
</TABLE>
<PAGE>
Compensation of Directors
Members of the Board of Directors who are not employees of the Company are
currently paid an annual retainer fee of $17,500 and an additional fee of $2,500
for each Board meeting attended. Any non-employee Director attending in person a
duly constituted meeting of a committee of the Board of Directors of which such
Director is a member receives, in addition to any other fees to which he may be
entitled, a separate meeting attendance fee equal to $2,500 for his or her
attendance in person at any such committee meeting not held on the same day, the
day preceding or the day following a regular or special meeting of the Board of
Directors. Any non-employee member of the Board of Directors who participates in
a regular or special meeting of the Board of Directors by conference telephone
or similar communications equipment receives $600 for each such meeting.
Non-employee Directors are reimbursed for out-of-pocket expenses in connection
with attendance at meetings. If a non-employee member of the Board of Directors
travels to conduct a site inspection of a property to be acquired by the
Company, such Director is paid $1,000 per day and reimbursed for related travel
expenses. Non-employee Directors receive no other cash compensation for their
services on behalf of the Company. Pursuant to the Company's Amended and
Restated 1992 Directors' Stock Option Plan, all Directors (whether or not
employed by the Company) receive annual grants of 10,000 stock options and newly
elected members receive 25,000 stock options.
Committees and Meetings of the Board of Directors
The Board of Directors held four regular meetings and no special meetings
during 1999. Each member of the Board of Directors attended at least 75% of the
aggregate number of meetings of the Board of Directors and the committees of
which he was a member during the last year except for Mr. Frank who missed two
of the regular meetings while hospitalized and recovering from a serious
accident.
The Company has an Audit Committee which consists of Messrs. Ballard
(Chairman), Downs, Frank and Nolan. The Audit Committee reviews the internal
control of the Company and reviews the services performed and to be performed by
the independent auditors of the Company during the year. The members of the
Audit Committee also meet regularly with the independent auditors to review the
scope and results of the annual audit. The Audit Committee met twice during
1999.
The Company also has a Compensation Committee which consists of Messrs.
Zankel (Chairman), Ballard and Frank. The Compensation Committee is responsible
for the administration of the Amended and Restated Employee Stock Option Plan
(the "Employee Plan"). The Compensation Committee met once during 1999.
The Company also has a Nominating Committee which consists of Messrs.
Bedford (Chairman), Downs and Frank. The Nominating Committee is responsible for
submitting nominations for the directors, elections for whom are held at the
annual meeting of Stockholders. The Nominating Committee does not consider
nominees proposed by Stockholders. The Nominating Committee met once during
1999.
The Company also has an Exploratory Committee which consists of Messrs.
Zankel (Chairman), Ballard, Bedford and Downs. The Exploratory Committee is
responsible for evaluating strategic alternatives. The Exploratory Committee met
once in 1999.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee during 1999 were Messrs. Zankel,
Ballard and Frank. None of these individuals were officers or employees of the
Company at any time during the year ended December 31, 1999, nor have any of
these individuals ever been an officer of the Company or any of its
subsidiaries. In addition, none of the executive officers of the Company served
on the compensation committee of another entity or as a director of an entity
which employs any of the members of the Compensation Committee.
Martin I. Zankel, a director of the Company, and his associates provided
legal services to the Company for which his firm was paid, in the aggregate,
$7,876 in 1999.
<PAGE>
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
KPMG LLP, Certified Public Accountants, served as independent accountants
of the Company for the fiscal year ended December 31, 1999. The Board of
Directors, acting upon the recommendation of its audit committee, has appointed
KPMG LLP to audit the financial statements of the Company for the fiscal year
ending December 31, 2000. A representative of KPMG LLP is expected to be present
at the Annual Meeting and will have the opportunity to make a statement if he so
desires and will be available to respond to appropriate questions from the
Common Stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMMON STOCKHOLDERS VOTE "FOR"
RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS INDEPENDENT ACCOUNTANTS OF THE
COMPANY.
<PAGE>
INFORMATION REGARDING EXECUTIVE OFFICERS
Executive Officers of the Company
The following persons serve as executive officers of the Company:
<TABLE>
<CAPTION>
Name Age Business Experience During Past Five Years Officer Since
- ---- --- ------------------------------------------ --------------
<S> <C> <C>
Peter B. Bedford 62 Mr. Bedford has been Chairman of the Board since 1992
May 1992 and Chief Executive Officer since
November 1992. Mr. Bedford has been engaged in the
commercial real estate business, primarily in the
Western United States, for over 36 years and has been
responsible for the acquisition, ownership, development
and management of an aggregate of approximately
19 million square feet of industrial, office and retail
properties, as well as land in 14 states. Mr. Bedford
serves on the board of directors of Bixby Ranch
Company, a real estate investment company, eVAULT, a
data storage company, and First American Title
Guarantee Co., a title insurance company. Mr. Bedford
is the recipient of numerous awards recognizing his
contributions to the real estate industry and serves as
a governor of the Urban Land Foundation and an overseer
of the Hoover Institution. His previous experience also
includes serving as Vice Chairman of the National
Realty Committee and of the Hoover Institution and as
Chairman of the Real Estate Advisory Board of the
Wharton School of Business. Mr. Bedford received his
B.A. in Economics from Stanford University.
James R. Moore 59 Mr. Moore has been Executive Vice President and Chief 1995
Operating Officer since January 1998 and joined the
Company in September 1995. From September 1995 to
June 1997, Mr. Moore was Vice President of
Property/Asset Management. From June 1997 to
January 1998, Mr. Moore was Senior Vice President of
Property/Asset Management. From 1983 to 1994, he was
Managing Director of Cushman and Wakefield, an
international commercial real estate services firm.
Mr. Moore was also a branch manager and commercial real
estate broker at Cushman and Wakefield. He has served
on the Board of Trustees of The Lindsay Museum since
1984. Mr. Moore has the CCIM designation and has
lectured at the University of San Francisco and San
Francisco State University. He received a B.A. in
History from the University of California at Berkeley,
an M.B.A. from the University of San Francisco and a
Doctorate in Business Administration Degree from Golden
Gate University.
Hanh Kihara 52 Ms. Kihara has been Senior Vice President and Chief 1993
Financial Officer of the Company since January 1999.
From May 1993 to January 1999, Ms. Kihara served as
Vice President and Controller of the Company. Prior to
joining the Company, she was Controller and Assistant
Controller of Bedford Properties Holdings, Ltd a
company wholly owned by Mr. Bedford (BPHL), from 1990
to 1993. From 1986 to 1990, Ms. Kihara was a Manager at
Armstrong, Gilmour and Associates, a certified public
accounting firm. Ms. Kihara has been a certified public
accountant since 1989. Ms. Kihara received a B.S. in
Administration and Accounting from California State
University of Hayward.
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
Dennis Klimmek 55 Mr. Klimmek has been Secretary since January 1998 and 1997
General Counsel since December 1998 of the Company and
Bedford Acquisitions, Inc., a California corporation
wholly-owned by Mr. Bedford. From October 1997, Mr.
Klimmek served as a Senior Vice President of the
Company and Bedford Acquisitions, Inc. From 1992 to
1997, Mr. Klimmek served as Vice President and General
Counsel of Kemper Real Estate Management Company and
its affiliates, a real estate development and
management company. From 1986 to 1992, he was Vice
President and General Counsel of BPHL. Mr. Klimmek has
been a member of the California Bar since 1974. He
received a B.S. in Business Administration/Economics
from Pepperdine University, a M.S. in Engineering from
the University of Southern California and a J.D. from
Loyola University.
Anne L. Hoffman 47 Ms. Hoffman has been Senior Vice President, Development 1998
of the Company and Bedford Acquisition, Inc. since
March 1998. Ms. Hoffman has personally managed the
development of over 1.5 million square feet of suburban
office, R&D, warehouse and service buildings. In the
four years immediate prior to joining the Company,
Ms. Hoffman was the principal of a real estate
consulting practice providing a variety of services to
corporate and developer clients such as Catellus, The
Martin Group, Chevron, Ryerson Steel, and Vintage
Properties. From 1992 to 1994, Ms. Hoffman was Vice
President of Sales and Marketing for HQ Network System,
the franchise organization for HQ Business Centers.
From 1984 to 1991 Ms. Hoffman was a Partner and Project
Manager for the Philadelphia based Rouse & Associates.
</TABLE>
<PAGE>
Compensation of Named Executive Officers
The following table sets forth information regarding compensation paid by
the Company for services rendered during the past three fiscal years for (i) the
Chief Executive Officer, (ii) the two next most highly compensated executive
officers of the Company who were employed by the Company as of December 31,
1999, and (iii) the two most highly compensated executive officers of Bedford
Acquisition, Inc. who were employed by Bedford Acquisition, Inc. as of December
31, 1999 (collectively, the "Named Executive Officers").
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------- ----------------------------
Restricted All Other
Salary Bonus Stock Awards Options Compensation
Name and Principal Position Year ($) ($) ($) (#) ($)(1)
- --------------------------- ---- ------- ---------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Peter B. Bedford 1999 175,000 150,000(2) 398,578(3) 10,000(4) 14,190
Chief Executive Officer 1998 154,500 50,000(2) 292,500(3) 10,000(4) 8,190
100,000(5)
10,000(4)
1997 150,000 100,000(2) 150,938(3) 75,000(5) 6,840
James R. Moore 1999 175,000 100,000(6) 398,578(3) -- 14,190
Executive Vice President and Chief 1998 151,875 100,000(6) 121,875(3) 75,000(5) 8,190
Operating Officer 1997 150,000 100,000(6) 100,625(3) 30,000(5) 3,240
Hanh Kihara 1999 150,000 65,000 290,972(3) -- 14,190
Senior Vice President and Chief 1998 96,500 40,000 97,500(3) 25,000(5) 1,590
Financial Officer 1997 82,500 40,000 60,375(3) 20,000(5) 1,590
Dennis Klimmek(7) 1999 150,000 150,000 318,891(3) -- 14,190
Senior Vice President, General 1998 151,500 100,000 97,500(3) 50,000(5) 8,190
Counsel and Secretary 1997 37,500 25,000 164,531(3) 60,000(5) 1,673
Anne L. Hoffman(8) 1999 150,000 150,000 271,050(3) -- 11,790
Senior Vice President, 1998 120,250 150,000 97,500(3) 25,000(5) 4,893
Development
</TABLE>
- ----------
(1) Includes auto allowance (in an aggregate amount of $30,600 for 1999,
$23,125 for 1998, and $8,550 for 1997), premiums paid by the Company for
term life insurance (in an aggregate amount of $450 for 1999, $428 for
1998, and $293 for 1997) and matching contributions under the Company's
401(k) Plan (in an aggregate amount of $37,500 for 1999, $7,500 for 1998,
and $4,500 for 1997).
(2) 30% of Mr. Bedford's 1999 bonus and 50% of Mr. Bedford's 1997 bonus were
paid by Bedford Acquisitions, Inc., a California corporation wholly-owned
by Mr. Bedford. See "Certain Relationships and Related Transactions
Funding of Acquisitions and Financing Costs."
(3) All restricted stock granted in 1997 and 1998, except for the restricted
stock granted to Mr. Klimmek under the terms of his employment agreement,
will fully vest five (5) years from the date granted. In the case of
restricted stock granted to Mr. Klimmek 20% of the restricted stock vests
annually from the date granted. Restricted stock granted in 1999 vests 13%
each anniversary of the date of grant, with the remaining 48% vesting on
the fifth anniversary of the grant. The aggregate restricted stock held by
the Named Executive Officers as of December 31, 1999 and the aggregate
cash value of those shares based on the closing price of the common stock
on the date of grant were as follows: Mr. Bedford 46,000 shares/$842,016;
Mr. Moore 34,750 shares/$621,078; Ms. Kihara 25,050 shares/$448,847; Mr.
Klimmek 31,000 shares/$580,922; and Ms. Hoffman 20,800 shares/$368,550.
The Named Executive Officers are paid dividends on their holdings of
restricted stock.
<PAGE>
(4) Represents stock options granted pursuant to the Director Plan.
(5) Represents stock options granted pursuant to the Employee Plan.
(6) 50% of Mr. Moore's 1999, 1998, and 1997 bonuses were paid by Bedford
Acquisitions, Inc., a California corporation wholly-owned by Mr. Bedford.
(7) Mr. Klimmek commenced employment with the Company and Bedford
Acquisitions, Inc., a California corporation wholly-owned by Mr. Bedford,
in October 1997.
(8) Ms. Hoffman commenced employment with the Company and Bedford
Acquisitions, Inc., a California corporation wholly-owned by Mr. Bedford,
in March 1998.
Option Grants
The following table sets forth certain information concerning options
granted during 1999 to the Named Executive Officers.
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates of Stock
Option Grants in 1999 Price Appreciation For Option
Individual Grants Term(3)
------------------------------------------------------ -----------------------------
Number of Securities Percent of Total
Underlying Options Granted to Exercise
Options Granted Employees in Fiscal Price Expiration 5% 10%
Name (#) Year ($/sh) Date ($) ($)
- ---- -------------------- ------------------- --------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Peter B. Bedford........ 10,000 (1) N/A $17.72 11/13/2009 $111,432 $282,391
James R. Moore.......... -- (2) -- -- -- -- --
Hanh Kihara............. -- (2) -- -- -- -- --
Dennis Klimmek.......... -- (2) -- -- -- -- --
Anne Hoffman............ -- (2) -- -- -- -- --
</TABLE>
- -----------
(1) Represents stock options granted pursuant to the Director Plan, which
options vest and become exercisable six months from the date of grant.
(2) No stock options were granted pursuant to The Employee Plan in 1999.
(3) Potential gains are net of exercise price, but before taxes associated
with exercise. These amounts represent certain assumed rates for
appreciation only, based on SEC rules, and do not represent the Company's
estimate or projection of the price of the Company's stock in the future.
Actual gains, if any, on stock option exercises depend upon the actual
future performance of the Common Stock and the continued employment of the
option holders throughout the vesting period. Accordingly, the potential
realizable values set forth in this table may not be achieved.
Aggregate Option Exercises in 1999 and Values at Year-End 1999
The following table sets forth information regarding the number of shares
acquired and value realized for options exercised by the Named Executive
Officers during the year ended December 31, 1999 and the number and aggregate
dollar value of unexercised options held at the end of 1999.
<PAGE>
Aggregated Option/SAR Exercises in
Last Fiscal Year and Year-End Option/SAR Values
<TABLE>
<CAPTION>
Number of Value of Unexercised
Securities Underlying in-the-Money Options
Unexercised Options at Year-End
at Fiscal Year-End ($)(1)
--------------------------------- ------------------------------
Shares Acquired Value Realized
Name on Exercise # ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ---------------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Peter B. Bedford.............. 30,000 118,139 140,000 125,000 810,469 213,281
James R. Moore................ 2,500 9,375 43,750 83,750 170,625 213,281
Hanh Kihara................... 5,000 19,375 29,000 28,750 217,547 --
Dennis Klimmek................ -- -- 67,500 42,500 -- --
Anne Hoffman.................. -- -- 6,250 18,750 -- --
</TABLE>
- ----------
(1) For all unexercised in-the-money options, assumes a fair market value at
December 31, 1999 of $17 1/16 per share of Common Stock (being the average
of the high and low price on that date), which is the last transaction in
the Common Stock on the New York Stock Exchange on that date.
Employment Agreement with Peter B. Bedford
On February 16, 1993, the Company entered into an employment agreement
with Mr. Bedford, Chairman and Chief Executive Officer, and amended the
agreement on September 18, 1995. Pursuant to the amended employment agreement,
Mr. Bedford has agreed to serve as Chairman and Chief Executive Officer of the
Company on a substantially full-time basis until the agreement's expiration on
September 18, 2000. After September 18, 2000, the agreement will be
automatically renewed for additional one-year terms unless either party gives
the other notice of non-renewal. Under the employment agreement, the Company
agrees to pay Mr. Bedford a salary of not less than $150,000 per annum, plus
automobile and parking allowances. The amended employment agreement provides
that the Company will pay Mr. Bedford a severance payment equal to his base
salary in the event that his employment is terminated by the Company without
cause or Mr. Bedford resigns following a change in control of the Company. The
agreement defines a "change of control" as a transaction not approved by a
majority of the Board that results in the acquisition by any person of 35% of
the voting stock of the Company, other than persons who had such voting control
at the time the agreement was originally entered into.
Employment Agreement with Dennis Klimmek
As of October 1, 1997, Bedford Acquisitions, Inc., a California
corporation wholly-owned by Mr. Bedford entered into a one-year employment
agreement with Mr. Klimmek pursuant to which Mr. Klimmek additionally agreed to
serve as Senior Vice President, and Counsel of the Company. Under the employment
agreement, Bedford Acquisition, Inc. agreed to pay Mr. Klimmek a base salary of
not less than $150,000 per annum, plus automobile expenses. Under the terms of
the agreement, Mr. Klimmek was granted 60,000 stock options and 7,500 restricted
shares of the Company on commencement of his employment. Additionally, Mr.
Klimmek received an annual incentive bonus, guaranteed to be $100,000 for the
first full year of Mr. Klimmek's employment, and $25,000 for 1997. The agreement
also provides that Mr. Klimmek is to receive a minimum of 50,000 options and
5,000 shares of restricted stock for each of the next two years of employment.
The agreement provides that if, at any time during the first three years of Mr.
Klimmek's employment, a "change of control" (as that term is defined in the
Restricted Stock Agreement) occurs in the Company or Mr. Klimmek is terminated
without cause, Mr. Klimmek will be granted (i) a severance payment equal to one
year's salary and bonus and (ii) the immediate grant and vesting of all
restricted stock and stock options previously granted to Mr. Klimmek.
<PAGE>
Employment Agreement with Anne Hoffman
Effective March 1, 2000, Bedford Acquisition, Inc. entered into a two-year
employment agreement with Ms. Hoffman pursuant to which Ms. Hoffman agreed to
continue her employment as Senior Vice President, Development. Under the
employment agreement, Bedford Acquisition, Inc. agreed to pay Ms. Hoffman a base
salary of $150,000 per annum, a bonus of $150,000 per annum, and automobile
expenses for the term of the agreement. The agreement provides that if Ms.
Hoffman is terminated without cause at any time prior to the end of the term of
the agreement she would receive $600,000 less the total amount of salary and
bonuses paid to her from March 1, 2000 through the date of termination.
Retention Agreements
The Company has entered into retention agreements ("Retention Agreements")
with Mr. Moore, Ms. Kihara and Mr. Bedford providing for certain cash payments
in the event of an executive's termination of employment following a change in
control of the Company. For purposes of the Retention Agreements, a "change in
control" is defined as (i) the acquisition by any person of 30% or more of the
combined voting power of the Company (with certain exceptions), (ii) a change in
50% of the membership of the Board during any consecutive 2-year period, where
new members of the Board were not approved by members at the beginning of the
period or by other members so approved, (iii) the occurrence of a
reorganization, merger, consolidation or other transaction after which the
stockholders of the Company immediately prior to the transaction do not,
immediately following the transaction, own more than 50% of the combined voting
power of the Company and (iv) a sale, liquidation or distribution of all or
substantially all of the assets of the Company. Mr. Bedford may elect to receive
termination payment under his Retention Agreement or his Employment Agreement
but not both.
In the event of an Involuntary Termination (as defined in the Retention
Agreements) of a participating executive within two years following a change in
control, such executive will be entitled to receive a cash payment equal to the
sum of the executive's salary plus 3-year average bonus. Any severance payable
under an executive's retention agreement will be reduced by any amount of
severance payable to such executive under any other plan, arrangement or
agreement under which the executive is entitled to receive cash severance
payments. In addition, the participating executive will be entitled to receive a
pro rata bonus for the year in which the Involuntary Termination occurs.
Board Compensation Committee Report on Executive Compensation
Overview
During 1999 the members of the Compensation Committee were Messrs. Zankel,
Ballard and Frank. The Compensation Committee is responsible for the general
compensation policies of the Company, and in particular is responsible for
setting and administering the policies that govern executive compensation. The
Compensation Committee evaluates the performance of management and determines
the compensation levels for all executive officers.
The primary objectives of the Company's compensation policies and programs
are (i) to attract and retain key executives, (ii) to reward performance by
these executives which benefits the Stockholders and (iii) to align the
financial interests of the Company's executive officers directly with those of
the Stockholders. The primary elements of executive officer compensation are
base salary, annual cash bonus, and stock option and restricted stock awards.
The salary is based on factors such as related experience, level of
responsibility, and comparison to similar positions in comparable companies. The
annual cash bonuses are based on the Company's performance measured against
attainment of financial and other objectives, and on individual performance.
Stock option and restricted stock awards are intended to align the executive
officer's interest with those of the Stockholders, and are determined based on
the executive officer's level of responsibility, number of options or shares
previously granted, and contributions toward achieving the goals and objectives
of the Company. Additional information on each of these compensation elements
follows.
Salaries
Base salaries for the executive officers are adjusted annually, following
a review by the Chairman and Chief Executive Officer (the "CEO") of the Company.
In completing the review, performance of the individual with respect to specific
objectives is evaluated, as are increases in responsibility and salaries for
similar positions. Comparisons are made to the total compensation packages of
other publicly traded real estate investment trusts of similar size, with a
<PAGE>
comparable number of properties and employees. These comparisons are completed
through a review of various public filings as well as through a review of the
results of the REIT Executive Compensation Survey sponsored by the National
Association of Real Estate Investment Trusts (NAREIT) and other industry
compensation surveys. When all reviews are completed, the CEO makes a
recommendation to the Compensation Committee for its review and final approval.
With respect to the CEO, the Compensation Committee considers a number of
factors in setting his compensation, the most important of which are the level
of compensation paid to chief executive officers of other real estate investment
trusts, the success of the Company's recent acquisitions of new properties, and
his importance to the Company's efforts to raise capital in the public markets.
The current base salary for Mr. Bedford, the Company's CEO, is less than the
average for chief executive officers of similar real estate investment trusts.
However, his total compensation is deemed appropriate in view of the restricted
stock and the stock options he holds.
Annual Bonuses
Annual bonuses are awarded on a discretionary basis and reflect both
Company and individual performance. The Compensation Committee considers
numerous qualitative and quantitative factors in determining these bonus awards,
including the amount of equity capital raised, the success of the Company's
acquisition and sale programs, and the growth in the Company's funds from
operations, after adjustment for lease commissions, tenant improvements and
other capital expenditures.
Stock Option Awards
Stock options are an integral part of each executive officer's
compensation and are utilized by the Company to provide an incentive to the
officer, and to align the interests of the executive with those of the
Stockholders by providing him with a financial interest in the Company. Options
granted by the Compensation Committee under the Company's Employee Stock Option
Plan are made at fair market value on the date of the grant, vest over various
time periods of up to five years and expire after ten years. In making grants,
the Compensation Committee takes into account the executive officer's
contributions to the Company, scope of responsibilities, salary and the number
of options previously granted. No options were granted to employees in 1999.
Restricted Stock Awards
A share of restricted stock entitles a participant to receive a share of
common stock at a specified vesting date, subject to vesting criteria, and, in
the discretion of the Compensation Committee performance criteria. All
restricted stock granted prior to 1999, except for the restricted stock granted
to Mr. Klimmek under the terms of his employment agreement, will fully vest five
(5) years from the date granted. In the case of restricted stock granted to Mr.
Klimmek, 20% of the restricted stock vests annually from the date granted. The
restricted stock granted in 1999 vests at the rate of 13% per year on each
anniversary of the grant. On the fifth anniversary of the grant, the remaining
48% of the stock will vest. Much like stock options, restricted stock awards are
utilized by the Company to provide an incentive to the employee, and to align
the interests of the employee with those of the Stockholders by providing the
employee with a financial interest in the Company. During 1999, the Company
granted 227,289 shares of restricted stock. These grants included restricted
stock granted to employees other than executive officers who were given an
election to exchange options for restricted stock based on the equivalent value
of each using a Black-Scholes valuation.
Section 162(m)
The Company intends that compensation paid to its executive officers will
be deductible under Section 162(m) of the Internal Revenue Code.
COMPENSATION COMMITTEE
Anthony Downs (Chairman)
Claude M. Ballard
Anthony M. Frank
<PAGE>
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 and officers, and any person who owns more than ten
percent (10%) of a registered class of the Company's equity securities, to file
reports of securities ownership on Form 3 and changes in ownership on Form 4 or
5 with the Securities and Exchange Commission (the "SEC"). Such officers,
directors and greater than ten percent (10%) stockholders are also required by
SEC rules to furnish the Company with copies of all Section 16(a) forms that
they file.
Based solely on its review of copies of such reports furnished to the
Company, the absence of a Form 3 or Form 5 or written representations that no
Form 5 was required, the Company believes that all Section 16(a) filing
requirements applicable to its officers, directors and greater than ten percent
(10%) stockholders during the fiscal year ended December 31, 1999 were
satisfied.
<PAGE>
Stock Price Performance Graph
The following line graph illustrates a five-year comparison of the
cumulative total stockholder return on the Common Stock against the cumulative
total return of the Standard & Poor's 500 Composite Stock Index and the SNL
Securities Corporate Performance Index Value of all publicly-traded real estate
investment trusts ("REITs") holding greater than a 75% equity interest in their
REIT-qualifying assets. The graph assumes that $100 was invested on December 31,
1994 in the Common Stock and the indices, and that all dividends were reinvested
throughout the period.
[THIS WAS ORIGINALLY DEPICTED AS A CHART IN THE ORIGINAL MATERIALS]
Five Year Cumulative Total Stockholder Return
<TABLE>
<CAPTION>
Year Ending
------------------------------------------------------------------------------
Index 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Bedford Property Investors, Inc. 100.00 138.58 184.87 244.17 202.62 224.73
S&P 500 100.00 137.58 169.03 225.44 289.79 350.78
SNL All Equity REITs 100.00 115.08 156.45 188.36 155.84 147.38
</TABLE>
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of March 15, 2000, with
respect to directors, certain employees of the Company and each person who is
known by the Company to own beneficially more than 5% of the shares of its
Common Stock, and with respect to shares of Common Stock owned beneficially by
all directors and officers of the Company as a group.
<TABLE>
<CAPTION>
Name and Address Number of Shares Percent of Class
- ---------------- Beneficially Owned ----------------
------------------
<S> <C> <C>
Bed Preferred No. 1 Limited Partnership(1)............................................. 3,449,667 (1) 17.08%
Peter B. Bedford....................................................................... 1,217,142 (2) 6.31%
Capital Growth Management.............................................................. 1,086,600 5.38%
ICM Asset Management 1,076,267 5.33%
Heitman/PRA Securities Advisors, Inc................................................... 1,012,208 5.01%
Anthony Downs.......................................................................... 76,410 (3) **
Anthony M. Frank....................................................................... 79,534 (3) **
Claude M. Ballard...................................................................... 70,239 (4) **
Martin I. Zankel....................................................................... 94,605 (5) **
Thomas H. Nolan, Jr.................................................................... 65,000 (6) **
James R. Moore......................................................................... 138,755 (7) **
Hanh Kihara............................................................................ 57,596 (8) **
Dennis Klimmek......................................................................... 55,761 (9) **
Anne Hoffman........................................................................... 39,300 (10) **
All directors and officers as a group (17 persons)..................................... 2,083,307 (11) 10.31%
</TABLE>
- ----------
** Less than 1%.
(1) A Delaware limited partnership beneficially owned by an investment fund
managed by AEW Capital Management. The shares held by this partnership
were acquired on October 14, 1997 upon the partnerships' conversion of all
of the shares of the Company's Series A Convertible Preferred Stock, then
outstanding, into shares of Common Stock.
(2) Includes 140,000 shares owned by Mr. Bedford's children (as to which Mr.
Bedford has sole voting power and may be deemed to be the beneficial
owner), 8,400 shares owned by Mr. Bedford's wife (as to which Mr. Bedford
has shared voting power and may be deemed to be beneficial owner), 50,000
shares owned by the Grindstone Trust a revocable trust in which Mr.
Bedford has a beneficial interest, 1,490 shares held in trust for Mr.
Bedford's grandchildren, and 108,750 shares of Common Stock subject to
options which are currently exercisable or will become exercisable within
60 days of March 15, 2000.
(3) Includes 45,000 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(4) Includes 45,000 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000 and 616 shares
held in trust for Mr. Ballard's children.
(5) Includes 8,991 partnership units convertible into 8,991 shares of Common
Stock and 45,000 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(6) Includes 65,000 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
<PAGE>
(7) Includes 68,750 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(8) Includes 19,000 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(9) Includes 12,500 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(10) Includes 12,500 shares subject to options which are currently exercisable
or will become exercisable within 60 days of March 15, 2000.
(11) Includes 8,991 partnership units convertible into 8,991 shares of Common
Stock and 514,000 shares subject to options which are currently
exercisable or will become exercisable within 60 days of March 15, 2000.
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Funding of Acquisition, Disposition and Development Costs
Due to the Company's limited financial resources, its activities relating
to the acquisition of new properties, sales of Company owned real estate and
development of real property are currently performed by Bedford Acquisitions,
Inc., ("Bedford Acquisitions"), a corporation wholly owned by Peter B. Bedford,
the Company's Chairman and Chief Executive Officer, pursuant to a written
contract dated January 1, 1995. The contract provides that Bedford Acquisitions
is obligated to provide services to the Company with respect to the Company's
acquisition, disposition, development and financing activities, and that Bedford
Acquisitions is responsible for the payment of its expenses incurred in
connection therewith. Such expenses include certain costs incurred by the
Company on behalf of Bedford Acquisitions, including the cost of officers and
directors insurance coverage under the Company's insurance policy. Bedford
Acquisitions also paid one-third of Mr. Bedford's bonus ($50,000), one-half of
Mr. Moore's bonus ($50,000), and all compensation paid to Mr. Silla, Mr. Klimmek
and Ms. Hoffman in 1999. Bedford Acquisitions must submit to the Company a
direct cost estimate for the Company's approval relating to each acquisition,
disposition or development, setting forth the estimated timing and amount of all
projected Bedford Acquisitions costs relating to the acquisition or financing.
Pursuant to the contract, Mr. Bedford is obligated to make the payments of
Bedford Acquisitions' expenses described above if Bedford Acquisitions fails to
make any such payments in a timely fashion, provided that Mr. Bedford is not
obligated to pay any such amounts exceeding $1 million or following a
termination of Bedford Acquisitions' obligations based on the expiration or
termination of the term of the contract. The contract provides that Bedford
Acquisitions is to be paid a fee in an amount equal to the lesser of (i) (w) 1
1/2% of the purchase price of property acquisitions, plus (x) 1 1/2% of the sale
price of dispositions, plus (y) 1 1/2% of the amount of any loans (less
third-party commissions) plus (z) 5% of the total costs paid on each development
project, or (ii) an amount equal to (a) the aggregate amount of approved
expenses funded by Bedford Acquisitions through the time of such acquisition or
financing minus (b) the aggregate amount of fees previously paid to Bedford
Acquisitions pursuant to such arrangement. In no event will the aggregate amount
of fees paid to Bedford Acquisitions exceed the aggregate amount of costs funded
by Bedford Acquisitions. The agreement with Bedford Acquisitions will expire on
January 1, 2001.
For the year ended December 31, 1999, the Company had paid Bedford
Acquisitions an aggregate of approximately $2,783,320 for acquisition,
disposition and development activities performed pursuant to the foregoing
arrangements which was approximately $640,128 less than the sum of 1.5% of the
aggregate purchase price of acquired or sold properties plus 5% of development
costs. The Company believes that since the fees charged under the foregoing
arrangements (i) have been and continue to be comparable to those charged by
other sponsors of real estate investment entities or other third-party service
providers and (ii) have been and continue to be charged only for services on
acquired or sold properties or developed properties, such fees were and continue
to be properly includable in direct acquisition costs and capitalized as part of
the asset or financing activities. If the Company were to discontinue this
arrangement, its acquisition, disposition and development activities would have
to be paid by the Company, as incurred, out of cash from operations or
borrowings and certain of such costs would be reflected as operating expenses in
its statement of operations rather than being capitalized. For example, without
the above-described arrangement with Bedford Acquisitions, the Company may have
incurred substantial operating expenses relating to acquisition, disposition and
development activities; if the Company had employed the same personnel and
incurred the same expenses as Bedford Acquisitions, net income and Funds from
Operations for the year ended December 31, 1999 each would have been reduced by
approximately $1,938,563 (or $0.09 per common share assuming dilution) compared
to the corresponding amounts actually reported for that period. The Company
intends to discontinue this fee arrangement if and when its operating results
permit it to sustain acquisition, disposition and development activities
internally. However, the termination of this arrangement prior to that time
would likely require the Company to decrease its acquisition, disposition and
development efforts, which could have a material adverse effect on the Company's
ability to grow.
Other Transactions
Martin I. Zankel, a member of the Board of Directors of the Company, and
his associates provide legal services to the Company for which his firm was
paid, in the aggregate, $7,876 in 1999.
<PAGE>
Indebtedness of Management
In September 1995, the Company established a Management Stock Acquisition
program. Under the program, options exercised by key members of management
within thirty days of the grant date may be exercised and paid for either in
cash or with a note payable to the Company. Each note is due five years after
the date of its issuance or within ninety days from termination of employment,
with interest payable quarterly. Mr. Bedford and Mr. Moore, both of whom are
executive officers of the Company, have exercised options for 25,000 and 27,500
shares of Common Stock, respectively, in exchange for notes of $325,000 and
$357,500, respectively, each payable to the Company. The notes bear interest at
7.5% per annum. As of February 28, 2000, $206,257 and $268,080, in principal
amount were outstanding under the notes owed by Mr. Bedford and Mr. Moore,
respectively.
OTHER INFORMATION
A copy of the Company's Annual Report or Form 10-K for the fiscal year
ended December 31, 1999, may be obtained, without charge, by writing to Dennis
Klimmek, General Counsel, Bedford Property Investors, Inc., 270 Lafayette
Circle, Lafayette, CA 94549.
OTHER MATTERS
The Board of Directors knows of no matter to be presented at the Annual
Meeting other than those set forth in the Notice of Meeting and described in
this Proxy Statement. If, however, any other business should properly come
before the meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in their discretion.
STOCKHOLDER PROPOSALS
Proposals of Stockholders intended to be presented at the annual meeting
of Stockholders to be held in 2001 must be received by the Company at its
principal executive offices no later than March 10, 2001 for inclusion in the
Company's Proxy Statement and form of proxy relating to that meeting. Such
proposals must meet the requirements of the rules of the Securities and Exchange
Commission relating to stockholder proposals.
By Order of the Board of Directors,
/s/ Dennis Klimmek
------------------
Dennis Klimmek
Secretary
April 10, 2000
