<PAGE> 1
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
/X/ Definitive Proxy Statement Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Materials Pursuant to Rule 14a-11(c) or Rule 14a-12
Mity-Lite, 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:
- ------------------------------------------------------------------------------
<PAGE> 2
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- ------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- ------------------------------------------------------------------------------
(3) Filing Party:
- ------------------------------------------------------------------------------
(4) Date Filed:
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<PAGE> 3
[GRAPHIC OMITTED - MITY-LITE LOGO]
MITY-LITE, INC.
1301 West 400 North
Orem, Utah 84057
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 12, 1999
NOTICE IS HEREBY GIVEN that an annual meeting of Shareholders of
Mity-Lite, Inc., a Utah corporation (the "Company"), will be held at the
Hampton Inn, 425 South 300 West, Salt Lake City, Utah 84101 on Thursday,
August 12, 1999, at 2:00 p.m., local time, for the following purposes:
1. To elect four (4) directors for the ensuing year or until their
successors are elected; and
2. To transact such other business as may properly come before
the annual meeting or any adjournment(s) thereof.
The Board of Directors has fixed the close of business on June 28, 1999,
as the record date for determining shareholders entitled to notice of, and to
vote at, the annual meeting and any postponement or adjournments thereof.
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN
PERSON. HOWEVER, TO ENSURE YOUR REPRESENTATION AT THE ANNUAL MEETING, YOU ARE
URGED TO MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE AS PROMPTLY AS POSSIBLE. ANY SHAREHOLDER ATTENDING THE
ANNUAL MEETING MAY VOTE IN PERSON EVEN IF SUCH SHAREHOLDER HAS PREVIOUSLY
RETURNED A PROXY.
By Order of the Board of Directors,
/s/ Gregory D. Dye
Gregory D. Dye
Corporate Secretary
Orem, Utah, July 1, 1999
<PAGE> 4
MITY-LITE, INC.
1301 West 400 North
Orem, Utah 84057
--------------------------------
PROXY STATEMENT
Information Concerning Solicitation and Voting
General
The enclosed Proxy is solicited on behalf of the Board of Directors of
Mity-Lite, Inc. (the "Company") for use at its annual meeting of Shareholders
to be held Thursday, August 12, 1999, at 2:00 p.m. local time, or at any
adjournment(s) thereof. The purposes of the annual meeting are set forth
herein and in the accompanying Notice of annual meeting of Shareholders. The
annual meeting will be held at the Hampton Inn, 425 South 300 West, Salt Lake
City, Utah 84101. The Company will bear the cost of this solicitation.
Record Date
Shareholders of record at the close of business on June 28, 1999, are
entitled to notice of and to vote at the annual meeting. As of the record
date, 3,200,270 shares of the Company's Common Stock, $.01 par value, were
issued and outstanding and entitled to be voted at the annual meeting.
Revocation of Proxies
Shareholders may revoke any appointment of proxy given pursuant to this
solicitation by delivering to the Company a written notice of revocation or a
duly executed proxy bearing a later date or by attending the annual meeting
and voting in person. An appointment of proxy is revoked upon the death or
incapacity of the shareholder if the Secretary or other officer of the Company
authorized to tabulate votes receives notice of such death or incapacity
before the proxy exercises its authority under the appointment.
Voting and Solicitation
Each shareholder will be entitled to one vote for each share of Common
Stock held at the record date. Assuming a quorum is present, a plurality of
votes cast by the shares entitled to vote in the election of directors will be
required to elect each director. It is estimated that the proxy materials
will be mailed to shareholders of record on or about July 1, 1999. The
principal executive offices of the Company are located at 1301 West 400 North,
Orem, Utah 84057. The Company will bear the cost of solicitation of proxies.
In addition to the use of the mail, proxies may be solicited personally, by
telephone, or by facsimile, and the Company may reimburse brokerage firms and
other persons holding shares of the Company's Common Stock in their names or
those of their nominees for their reasonable expenses in forwarding soliciting
materials to the beneficial owners. Abstentions or broker non-votes (ie.,
shares held by a broker nominee which are represented at the annual meeting,
but with respect to which such broker or nominee is not empowered to vote on a
particular proposal) will be counted as shares that are present and entitled
to vote for purposes of determining the presence of a quorum.
<PAGE> 5
Deadline for Receipt of Shareholder Proposals
The deadline for receipt of proposals for issues to be placed on the
proxy statement and form of proxy for the August 1999 Shareholders meeting was
March 15, 1999. Shareholders of the Company who intend to present proposals
at the Company's 2000 annual meeting of shareholders must deliver such
proposals to the Company no later than March 15, 2000, in order to be included
in the proxy statement and form of proxy relating to the 2000 annual meeting.
PROPOSAL 1
ELECTION OF DIRECTORS
Nominees
The Company's Board of Directors currently consists of four directors.
It is contemplated that four directors will be elected at the annual meeting.
Unless otherwise instructed, the proxy holders will vote the proxies received
by them for management's four nominees, namely Gregory L. Wilson, Ralph E.
Crump, C. Lewis Wilson and Peter Najar, all of whom are presently directors of
the Company. In the event that any director nominee is unable or declines to
serve as a director at the time of the annual meeting, the proxies will be
voted for any nominee who shall be designated by the present Board of
Directors to fill the vacancy. In the event that additional persons are
nominated for election as directors, the proxy holders intend to vote all
proxies received by them in such a manner as will ensure the election of as
many of the referenced nominees as possible. It is not expected that any
nominee will be unable or will decline to serve as a director. The term of
office of each person elected as a director will continue until the next
annual meeting of shareholders, or until such person's successor has been
elected and qualified. Officers are appointed by the Board of Directors and
serve at the discretion of the Board.
RECOMMENDATION OF BOARD OF DIRECTORS:
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" EACH
OF THE FOUR NOMINEES TO THE COMPANY'S BOARD OF DIRECTORS. ASSUMING A QUORUM
IS PRESENT, A PLURALITY OF VOTES CAST BY THE SHARES ENTITLED TO VOTE IN THE
ELECTION OF DIRECTORS WILL BE REQUIRED TO ELECT EACH DIRECTOR.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of four meetings
during the fiscal year ended March 31, 1999. The Audit Committee of the Board
of Directors, consisting of directors Crump, Najar and C. Wilson, met three
times during the last fiscal year. The Audit Committee is primarily
responsible for reviewing the services performed by the Company's independent
public accountants and internal accounting department and evaluating the
Company's accounting principles and its system of internal accounting
controls. The Compensation Committee of the Board of Directors, consisting of
directors Crump, Najar and C. Wilson, met two times during the last fiscal
year. The Compensation Committee is primarily responsible for reviewing
compensation of executive officers and overseeing the granting of stock
<PAGE> 6
options. All members of the Board of Directors attended at least 75 percent
of all meetings of the Board and all Board Committee members attended at least
75 percent of all Committee meetings held during the fiscal year ended March
31, 1999.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
director nominees and executive officers of the Company.
Director or Officer
Name Age Position with the Company
- ------------------------ ------- ---------------------------------
Gregory L. Wilson 51 Chairman of the Board, President,
and Chief Executive Officer
Bradley T Nielson 37 Chief Financial Officer and Chief
Operating Officer
Kenneth A. Law 50 Vice President - Manufacturing
Gregory D. Dye 39 Corporate Secretary
Paul R. Killpack 30 Corporate Treasurer
Ralph E. Crump(1) 75 Director
Peter Najar(1) 49 Director
C. Lewis Wilson(1) 59 Director
- ------------------------------------------
(1) Member of Compensation and Audit Committees.
Officers are appointed by and serve at the discretion of the Board of
Directors. Each director holds office until the next annual meeting of
shareholders or until his successor has been duly elected and qualified.
Gregory L. Wilson and C. Lewis Wilson are brothers. Ralph E. Crump is the
father-in-law of Peter Najar. All executive officers of the Company devote
full time to their duties. Non-management directors devote such time as is
necessary to carry out their responsibilities.
The following is a description of the business experience of each of the
director nominees and each of the executive officers of the Company.
Gregory L. Wilson is the founder of the Company and has been the
President, Chief Executive Officer and a director since the Company's
inception in September 1987. He has served as Chairman of the Board since
March 1988. Mr. Wilson also served as the Treasurer from September 1993 to
August 1995. From 1982 until 1987, Mr. Wilson was President of Church
Furnishings, Inc., in Provo, Utah. He is currently a director of Stratasys,
Inc. (Nasdaq). He earned a Bachelor of Arts Degree in Economics from Brigham
Young University in 1971 and a Masters of Business Administration Degree from
Indiana University in 1973.
Bradley T Nielson became the Company's Chief Financial Officer in March
1994, and Chief Operating Officer in August, 1998. He served as Corporate
Secretary from January 1998 to August 1998. From August 1992 to March 1994,
Mr. Nielson was the Vice President - Finance for Pinnacle Micro, Inc. From
January 1991 to August 1992, he was a management consultant for Price
Waterhouse's National Manufacturing Management Consulting Group. He was
employed by Ernst & Young from June 1985 to January 1991. Mr. Nielson
graduated with a Bachelor of Science Degree in Accounting from Brigham Young
University. He is a Certified Public Accountant, a Certified Management
Accountant and is Certified in Financial Management.
<PAGE> 7
Kenneth A. Law has been Vice President - Manufacturing since September
1993. From April 1988 until September 1993, Mr. Law served as the Company's
Production Manager. From September 1987 to September 1988 he was a production
foreman for the Company. Mr. Law holds an Associate Degree in Business
Management from Utah Valley State College.
Gregory D. Dye became the Company's Corporate Secretary in August 1998.
He joined the company in August 1997 and served as an engineer, trainer and
quality manager prior to being named Corporate Secretary. Mr. Dye graduated
from Utah State University with a Bachelors Degree in Business/Production
Management in 1985. From May 1985 to July 1997, he was a manager for
Woodgrain Millwork, Inc.
Paul R. Killpack became the Company's Treasurer in August 1998. He
joined the Company in April 1997 and served as the Controller prior to being
named Treasurer. Mr. Killpack graduated from Brigham Young University with a
Masters of Business Administration Degree in 1998.
Ralph E. Crump has been a director since March 1988. Mr. Crump is
President of Crump Industrial Group, an investment firm located in Trumbull,
Connecticut. For a short time in 1988, Mr. Crump served as the Company's
Treasurer. Mr. Crump is a founder and director of Osmonics, Inc. (NYSE) and
Stratasys, Inc. (Nasdaq). He is also a founder, director and chairman of
IMTEC, Inc. (Nasdaq) and Structural Instrumentation, Inc. (Nasdaq). From 1962
until 1987, Mr. Crump was the President and Chairman of Frigitronics, Inc.
(NYSE). Mr. Crump is also a Trustee of the Alumni Foundation of the
University of California at Los Angeles and a member of the Board of Overseers
for the Thayer Engineering School at Dartmouth College. He received a
Bachelor of Science Degree in Chemical Engineering in 1950 from the University
of California at Los Angeles and a Bachelor of Science Degree in Marine
Engineering from the U. S. Merchant Marine Academy. Mr. Crump is a licensed
professional engineer.
Peter Najar has been a director since March 1988. From August 1988 until
September 1993 he served as the Assistant Treasurer and Assistant Corporate
Secretary. Mr. Najar has been a sales engineer employed by Lange Sales, Inc.
in Littleton, Colorado from November 1981 to the present. From 1977 to 1981,
Mr. Najar was the National Technical Director for Head Ski Co.
C. Lewis Wilson has been a director since May 1991. From 1987 to 1996,
Mr. Wilson, a licensed professional engineer, was the President of Heath
Engineering Company, a consulting engineering firm in Salt Lake City, Utah.
From 1996 to present, Mr. Wilson has served as the Chairman and Chief
Executive Officer of Heath Engineering Company. He received a Bachelor of
Engineering Sciences Degree in Mechanical Engineering from Brigham Young
University in 1966 and a Masters of Mechanical Engineering Degree from Purdue
University in 1968. Mr. Wilson is a published technical author and has been
an Adjunct Professor of Mechanical Engineering at the University of New
Mexico, Brigham Young University and the University of Utah.
<PAGE> 8
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 officers and directors and persons who own beneficially
more than 10 percent of a registered class of the Company's equity securities
to file with the Securities and Exchange Commission and Nasdaq initial reports
of ownership and reports of changes in ownership of the Company's equity
securities. Officers, directors and greater than 10 percent beneficial owners
are required to furnish the Company with copies of all Section 16(a) reports
they file. Based on the Company's information, the directors, officers, and
greater than 10 percent shareholders have timely filed all necessary Forms 3,
4 and 5, for the fiscal year ended March 31, 1999.
SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS
The following table sets forth security ownership information as of May
21, 1999 (i) for persons known by the Company to own beneficially more than 5
percent of the Company's Common Stock, (ii) for each director or director
nominee and executive officer, and (iii) for all officers and directors of the
Company as a group:
Shares
Beneficially Percent
Name & Address(1) Owned(2) Of Class(3)
- ------------------------------------ ------------- -------------
Gregory L. Wilson(4) 868,204 25.78%
Peter Najar(5) 469,631 13.94
Ralph E. Crump(6) 317,634 9.43
Bradley T Nielson(7) 69,686 2.07
Kenneth A. Law(8) 62,861 1.87
C. Lewis Wilson(9) 35,391 1.05
All officers and directors as a
group (8 persons) 1,826,166 54.22
- -------------------------------------------
(1) The address for Gregory L. Wilson, Kenneth A. Law, Bradley T Nielson, and
Paul R. Killpack is 1301 West 400 North, Orem, Utah 84057. The address for
Peter Najar is 9900 Phillips Road, Lafayette, Colorado 80026. The address for
Ralph E. Crump is 28 Twisted Oak Circle, Trumbull, Connecticut 06611. The
address for C. Lewis Wilson is 377 West 800 North, Salt Lake City, Utah
84103.
<PAGE> 9
(2) The number of shares beneficially owned includes shares of the Company's
Common Stock for which the persons set forth in this table have or share
either investment or voting power. The number of shares beneficially owned
also includes shares that any of the named persons has the right to acquire
within 60 days of May 21, 1999, upon exercise of the stock options granted to
them under the Company's 1990 Stock Option Plan and the Company's 1997 Stock
Incentive Plan.
(3) All percentages have been calculated to include 3,229,717 shares of
Common Stock outstanding on May 21, 1999, plus options exercisable within 60
days following May 21, 1999 to purchase 138,139 shares.
(4) Includes 421,909 shares owned individually by Mr. Wilson, 435,209 shares
owned individually by his wife, Kathleen Wilson, and 11,086 shares held by
Kathleen Wilson as the custodian for the Wilson children. Gregory and
Kathleen Wilson disclaim beneficial ownership of the shares held by Kathleen
Wilson as custodian for their children.
(5) Includes 213,883 shares owned individually by Constance Crump, the wife
of Mr. Najar, and 41,865 shares held by Constance Crump as custodian for
certain minor-aged relatives. Mr. Najar disclaims beneficial ownership of the
shares held by Constance Crump as custodian.
(6) Includes 158,817 shares owned individually by Marjorie Crump, the wife of
Mr. Crump.
(7) Includes 16,600 shares owned individually by Mr. Nielson, 1,200 shares
owned jointly by Mr. Nielson and his wife, Kellie Nielson, and 51,886 shares
that Mr. Nielson had the right to acquire within 60 days following May 21,
1999 upon exercise of options granted to him.
(8) Includes 10,287 shares owned individually by Mr. Law, 4,774 shares owned
individually by Fern Law, his wife, and 47,800 shares that Mr. and Mrs. Law
had the right to acquire within 60 days following May 21, 1999 upon exercise
of stock options granted to them.
(9) Includes 27,467 shares owned jointly by C. Lewis Wilson and his wife,
Grace Wilson, 3,662 shares owned individually by Grace Wilson, 3,662 shares
owned individually by Mr. Wilson and 600 shares held by Mr. Wilson as
custodian for the Wilson children.
REPORT OF COMPENSATION COMMITTEE
The Compensation Committee Report discusses the Company's executive
compensation policies and the basis for the compensation paid to the Company's
executive officers, including its Chief Executive Officer, Gregory L. Wilson
during the fiscal year ended March 31, 1999.
Compensation Policy. The Company's executive compensation program has
been designed to:
o Adequately and fairly compensate executive officers in relation to
their responsibilities, capabilities and contributions to the
Company.
<PAGE> 10
o To reward executive officers for the achievement of short-term
operating goals and for the enhancement of the long-term value of
the Company; and
o Align the interests of the executive officers with those of the
Company's stockholders with respect to short-term operating goals
and long-term increases in the price of the Company's Common Stock.
The three key components of the Company's executive compensation program
for fiscal 1999 for all executive officers, including its Chief Executive
Officer, were base salary, short-term incentive bonuses, and long-term
incentives in the form of stock options. Overall compensation is intended to
be competitive. Annual bonuses are paid out at the Board of Director's sole
discretion, and are typically based on pre-tax profit. The Compensation
Committee has been responsible for: reviewing and approving cash compensation
paid by the Company to its executive officers and members of the Company's
senior management team, including bonuses and awards made under the
aforementioned incentive plans; and reviewing, establishing and administering
the Company's incentive plans, including determining the individuals who will
receive discretionary bonuses and awards and determining the timing, pricing
and amount of all such bonuses and awards granted. In reviewing and approving
the base salaries paid to its executive officers, the Committee considers
various factors including (1) the nature of each executive officer's
responsibilities, capabilities and contributions; and (2) the performance of
the Company (to the extent such performance can fairly be attributed or related
to each executive officer's performance). The Compensation Committee believes
that the concepts discussed above further the shareholders' interests and that
officer compensation encourages responsible management of the Company.
Ralph E. Crump
Peter Najar
C. Lewis Wilson
Summary Compensation Table. The following table sets forth the annual
and long-term compensation awards to the President and Chief Executive Officer
of the Company and other executive officers (the "Named Executive Officers")
receiving more than $100,000 in annual salary and bonus compensation for
services in all capacities to the Company for the fiscal years ended March 31,
1997, March 31, 1998 and March 31, 1999.
<PAGE> 11
Long-Term
Annual Compensation Compensation
------------------- ------------
Securities
Underlying
Fiscal Option/ All Other
Year Salary Bonus (1) SARs (#) Comp.(2)
------ -------- ---------- ------------- ----------
Gregory L. Wilson, 1999 $75,000 $100,000 20,000 (4) $18,400
Chairman, President, 1998 75,000 70,000 - 5,300
and Chief Executive 1997 73,100 70,000 - 8,600
Officer
Bradley T Nielson, 1999 70,000 94,000 15,000 (4) 18,500
Chief Financial 1998 70,000 45,000 10,000 (3) 6,000
Officer and Chief 1997 68,800 40,000 - 6,000
Operating Officer
Kenneth A. Law, 1999 70,000 42,500 5,000 (4) 8,300
Vice President 1998 70,000 30,000 - 5,800
Manufacturing 1997 68,800 33,000 - 5,300
(1) During the reported periods, bonuses were awarded annually at the
discretion of the Board of Directors to the Named Executive Officers and
certain other officers and Company personnel. No formal bonus plan exists.
The Board is not obligated to award bonuses.
(2) Amounts under the column heading "All Other Compensation" represent
matching contributions made by Mity-Lite under the Company's 401(k) defined
contribution plan and the value of personal use of Company-owned vehicles. In
1999, Mr. Wilson and Mr. Nielson both received $11,600 for serving on the
board of directors of DO Group, Inc., a Mity-Lite affiliate.
(3) Options vest over a three-year period commencing in 1998, one-third of
the options vesting per year.
(4) Options vest over a four-year period commencing in 2000, one-fourth of
the options vesting per year.
1990 Stock Option Plan. As of May 21, 1999, options to purchase 499,861
shares of the Company's Common Stock had been granted under the Company's 1990
Incentive Stock Option Plan (the "1990 Option Plan"), which expires by its own
terms in May 2000. Of the total 499,861 options granted as of May 21, 1999,
389,760 had been granted to executive officers of the Company. Of the total
options granted, 487,470 were vested and had either been exercised or were
immediately exercisable as of May 21, 1999. As of May 21, 1999, the Company
had 139 shares reserved for issuance upon exercise of options that could still
be granted under the 1990 Option Plan.
<PAGE> 12
The 1990 Option Plan provides for the grant of incentive stock options
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended, and non-qualified stock options to employees and non-employee
directors of the Company. Incentive stock options may be granted only to
employees. The 1990 Option Plan is administered by the Compensation Committee
of the Board of Directors, which determines the terms of options granted
including the exercise price, the number of shares subject to the option, and
the exercisability of the option.
The term of the 1990 Option Plan is ten years. With respect to any
participant who owns stock representing more than 10 percent of the voting
rights of the Company's outstanding capital stock, the exercise price of any
option must be at least equal to 110 percent of the fair market value on the
date of grant. Otherwise, the exercise price for options intended to be
incentive stock options is the fair market value on the date of grant. The
exercise price of any non-qualified stock option is determined by the
Compensation Committee, in its absolute discretion after taking into
consideration factors it deems relevant.
1997 Stock Incentive Plan. As of May 21, 1999, options to purchase
338,600 shares of the Company's Common Stock had been granted under the
Company's 1997 Stock Incentive Plan (the "1997 Stock Incentive Plan"), which
expires by its own terms in March 2007. Of the total 338,600 options granted
as of May 21, 1999, 73,000 had been granted to executive officers of the
Company and 135,000 options had been granted to executive officers of the
Company's affiliate, DO Group, Inc. Of the total options granted, 22,195 were
vested and were exercisable as of May 21, 1999. As of May 21, 1999, the
Company had 161,400 shares reserved for issuance upon exercise of options that
could still be granted under the 1997 Stock Incentive Plan.
The 1997 Stock Incentive Plan provides for the grant of incentive stock
options within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended, non-qualified stock options and stock rights to directors,
officers, employees and consultants of the Company and its affiliates.
Incentive stock options may be granted only to officers and employees. The
1997 Stock Incentive Plan is administered by the Compensation Committee of the
Board of Directors, which determines the terms of options granted including
the exercise price, the number of shares subject to the option, and the
exercisability of the option.
The term of the 1997 Stock Incentive Plan is ten years. With respect to
any participant who owns stock representing more than 10 percent of the voting
rights of the Company's outstanding capital stock, the exercise price of any
option must be at least equal to 110 percent of the fair market value on the
date of grant. Otherwise, the exercise price for options intended to be
incentive stock options is the fair market value on the date of grant. The
exercise price of any non-qualified stock option is determined by the
Compensation Committee, in its absolute discretion after taking into
consideration factors it deems relevant.
Shown below is information with respect to exercises of stock options
during the last completed fiscal year by each of the Named Executive Officers
and the fiscal year-end value of unexercised options.
<PAGE> 13
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<CAPTION>
Number of Value of
Securities Unexercised
Underlying In-the-Money
Unexercised Options/SARs
Options/SARs at at March 31,
March 31, 1999(#) 1999 ($)(1)
Shares
Acquired or Value Exercisable/ Exercisable/
Exercised (#) Realized ($) Unexercisable Unexercisable
------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Gregory L. Wilson,
Chairman, President, and
Chief Executive Officer - - 0/20,000 $0/0
Bradley T Nielson,
Chief Financial Officer
and Chief Operating
Officer 5,800 $70,000 48,533/21,667 559,000/30,000
Kenneth A. Law, Vice
President Manufacturing - - 47,800/ 5,167 478,000/ 3,000
</TABLE>
(1) Value is based on market price of the Company's Common Stock
(closing price of $15.25 per share on the Nasdaq National Market on March
31, 1999) less exercise price.
<PAGE> 14
401(k) Plan. In January 1995, the Board of Directors of the Company
adopted a Defined Contribution 401(k) Plan and Trust (the "401(k) Plan"). The
401(k) Plan allows the Board to determine the amount of the Company
contribution. The Board adopted a contribution formula specifying that such
discretionary employer matching contributions would equal 25 percent of the
participating employee's contribution to the 401(k) Plan up to a maximum
discretionary employer contribution of 3 percent of a participating employee's
compensation, as defined by the 401(k) Plan. In addition, the Board at its
discretion can provide for additional employer matching. For the 401(k) Plan
year ended December 31, 1996, 1997 and 1998, the Board provided for additional
matching contributions that would equal 37.5 percent of the participating
employee's contribution to the 401(k) Plan up to a maximum 3 percent of a
participating employee's compensation, as defined by the 401(k) Plan. The
401(k) Plan allows the Board to utilize either Common Stock of the Company or
cash as a matching contribution. To date, all matching contributions have
been in cash. The Board has approved the reservation of 25,000 shares of
Common Stock for issuance under the Company's 401(k) Plan. These shares may
be issued to satisfy all or a portion of the Company's matching contribution
under the 401(k) Plan or issued as a result of a participant's election to
acquire shares of the Company's Common Stock as an investment option under the
401(k) Plan. If such investment option is elected by plan participants, the
shares will be issued at a price per share which is the lower of 85 percent of
the fair market value of a share of Common Stock on the commencement of the
applicable quarterly election period or 85 percent of the fair market value of
a share of Common Stock on the last day of the applicable quarterly election
period. As of May 21, 1999, 12,365 shares had been issued to the 401(k)
Plan. All employees who have completed at least six months of service with
the Company and who satisfy other requirements are eligible to participate in
the 401(k) Plan.
Employment Agreements. The Company has entered into employment
agreements effective May 21, 1998, with Gregory L. Wilson, the Company's
Chairman and President and Kenneth A. Law, the Company's Vice
President-Manufacturing, each for a term ending May 20, 2003. The Company
entered into an employment agreement effective January 1, 1999 with Bradley T
Nielson, Chief Financial Officer and Chief Operating Officer, with a term
ending December 31, 2003. Each employment agreement provides that compensation
will be determined annually by the Compensation Committee of the Board of
Directors. Each employment agreement contains a non-compete clause covering
the term of the agreement and three years thereafter. Each employment
agreement can be terminated by the Company without cause entitling the
terminated employee to two months salary as severance.
Director Compensation. The Company's directors receive no compensation
for attendance at Board meetings. However, the directors are reimbursed for
their expenses related to attending Board meetings.
Certain Transactions
The Company leases its production and office facility for a five-year
term from a trust of which Gregory L. Wilson's uncle is a trustee. The fixed
base monthly rent for the term of the lease is $17,100. The Company pays
maintenance costs, taxes and insurance costs under the lease. The Company
believes that the terms of the lease are no less favorable to the Company than
could be obtained from an unrelated third party. No independent appraisal or
evaluation of the lease terms has been obtained.
<PAGE> 15
The Company has entered into indemnification agreements with each of its
officers and directors. The Company has adopted policies that any loans to
officers, directors and 5 percent or more shareholders ("affiliates") are
subject to approval by a majority of the disinterested directors and that any
transactions with affiliates will be on terms no less favorable than could be
obtained from unaffiliated parties. In April 1999, the Company temporarily
loaned $275,000 to Gregory L. Wilson, its President, in the form of notes
receivable. The notes earned interest at the rate of eight percent and were
secured by shares of Mity-Lite common stock. Mr. Wilson subsequently repaid
the notes in May 1999.
STOCK PERFORMANCE
The following graph compares the yearly percentage change in the
cumulative total stockholder return on Mity-Lite Common Stock during the five
fiscal years ended March 31, 1999 with the cumulative total return of other
Indices. The comparison assumes $100 was invested on April 29, 1994 (the date
of the Company's initial public offering) in Mity-Lite Common Stock and in
each of such indices and assumes reinvestment of dividends. The publicly
traded companies in the peer index are Chromcraft Revington Inc., Falcon
Products Inc., Flexsteel Industries Inc., Neutral Posture Ergo Inc., Shelby
Williams Ind. Inc., and Virco Manufacturing CP.
[GRAPHIC OMITTED - STOCK PERFORMANCE CHART]
4-29-94 3-31-95 3-31-96 3-31-97 3-31-98 3-31-99
------- ------- ------- ------- ------- -------
Mity-Lite, Inc. $100.00 $125.49 $125.49 $227.45 $305.88 $239.22
Russell 2000 Index $100.00 $104.89 $135.48 $142.40 $202.19 $168.29
Self-determined peer
group $100.00 $94.85 $111.49 $137.07 $173.95 $124.75
OTHER MATTERS
The Company knows of no other matters to be submitted to the annual
meeting. If any other matters properly come before the annual meeting, it is
the intention of the persons named in the enclosed form of proxy to vote the
shares they represent as the Company may recommend.
<PAGE> 16
ANNUAL REPORT TO SECURITIES AND EXCHANGE COMMISSION
A copy of the Company's Annual Report on Form 10-K as filed with the
Securities and Exchange Commission may be obtained by shareholders without
charge by written request to Bradley T Nielson, Chief Financial Officer,
Mity-Lite, Inc., 1301 West 400 North, Orem, Utah, 84057.
By the Order of Board of Directors,
/s/ Gregory D. Dye
Gregory D. Dye, Corporate Secretary
DATED: July 1, 1999
<PAGE> 17
FORM OF PROXY:
MITY-LITE, INC.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
August 12, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF MITY-LITE, INC.
The undersigned common shareholder of Mity-Lite, Inc., a Utah
corporation, hereby acknowledges receipt of the Notice of Annual Meeting of
Shareholders, to be held on August 12, 1999, 2:00 p.m. local time at the
Hampton Inn, 425 South 300 West, Salt Lake City, Utah, and hereby appoints
Gregory L. Wilson and Gregory D. Dye, or either of them, each with the power
of substitution, as proxies to vote at said Annual Meeting of Shareholders and
at all adjournments thereof, all shares of common stock which the undersigned
would be entitled to vote on the matters set forth below, if personally
present.
1. ELECTION OF DIRECTOR NOMINEES: Gregory L. Wilson, Ralph E. Crump, C.
Lewis Wilson and Peter Najar.
[ ] FOR all nominees listed (except [ ] WITHHOLD AUTHORITY to vote for
as marked to the contrary below) all nominees listed
Instruction: To withhold authority for an individual nominee, write that
nominee's name here:
- ----------------------------------------------------------------------------
(Continued and to be signed on other side)
2. IN THEIR DISCRETION, ON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY
DIRECTION IS INDICATED, WILL BE VOTED FOR PROPOSAL 1. In their discretion,
the proxies are authorized to vote upon such other matters as may properly
come before the meeting or any adjournment(s) thereof.
Dated: , 1999
--------------------------------------------------
Signature
(This proxy should be marked, dated, signed by each
shareholder exactly as such shareholder's name appears
hereon and returned promptly in the enclosed envelope.
Persons signing in a fiduciary capacity should so
indicate. If shares are held by joint tenants or as
community property, both should sign. If a corporation,
please sign in full corporation name by the President or
by an authorized corporate officer. If a partnership,
please sign in partnership name by an authorized person).
