<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. ___)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
NESCO, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously by written preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: _______________________________________________
(2) Form, Schedule or Registration Statement No.___________________________
(3) Filing Party:__________________________________________________________
(4) Date Filed:_________________________________
<PAGE>
NESCO, INC.
12331 E. 60TH STREET, TULSA, OKLAHOMA 74146
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 18, 2000
MEETING NOTICE
The Annual Meeting of the Shareholders of NESCO, Inc., an Oklahoma Corporation,
will be held at 12331 E. 60th St., Tulsa, Oklahoma, on May 18, 2000, at 1:00
p.m. for the purpose of considering and acting upon the following:
(1) The election of five directors for a one year term.
(2) The ratification of the selection of Tullius Taylor Sartain & Sartain
as independent auditors to audit the financial statements to be
included in the Annual Report to Shareholders for 2000.
(3) The consideration of the proposal to approve the NESCO, Inc. 2000
Equity Incentive Plan.
(4) The transaction of any other matters that properly come before the
meeting or any adjournment thereof.
Shareholders entitled to vote are invited to attend the Annual Meeting.
The Board of Directors has fixed the record date for the determination of
shareholders entitled to notice and to vote at the Annual Meeting at 5:00 p.m.,
April 7, 2000.
The Company's Proxy Statement and Annual Report are included with this notice.
Dated: April 14, 2000
/s/ Larry G. Johnson
Larry G. Johnson
Vice President &
Secretary Treasurer
REGARDLESS OF WHETHER YOU NOW EXPECT TO BE PRESENT PERSONALLY AT THE MEETING,
YOU ARE REQUESTED TO SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE
ENCLOSED SELF-ADDRESSED, POSTAGE PRE-PAID ENVELOPE.
<PAGE>
NESCO, Inc.
12331 E. 60th Street, Tulsa Oklahoma 74146
ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 2000
PROXY STATEMENT
The Board of Directors solicits your proxy for use at the Annual Meeting of
NESCO, Inc. (the "Company") to be held at 1:00 PM on May 18, 2000 at the
corporate office located at 12331 East 60th Street, Tulsa, Oklahoma. Proxy
statements and proxies were first mailed to shareholders on or about April 14,
2000. A shareholder who signs and returns a proxy may revoke it or give special
voting specifications at any time before the proxy is exercised by writing the
Secretary of the Company at its offices at 12331 E. 60th St., Tulsa, Oklahoma,
74146, by exercising a later-dated proxy or by attending the 2000 Annual Meeting
in person and giving written notice to the Secretary of the Company. The proxy
will be voted in accordance with such specifications.
Shareholders of record at the close of business on April 7, 2000 (the "Record
Date") will be entitled to vote at the Annual Meeting. The Company had
9,255,855 outstanding shares of common stock on the Record Date. The Company
has no other voting securities outstanding. Shareholders are entitled to one
vote per share on each matter. If the accompanying form of proxy is signed and
returned, the shares will be voted for each of the nominees named herein, for
approval of the NESCO, Inc. 2000 Equity Incentive Plan and for the selection of
Tullius Taylor Sartain & Sartain as the Company's independent auditors.
A shareholder may, with respect to the selection of directors (i) vote for the
election of all nominees named herein as directors, (ii) withhold authority to
vote for all these director nominees or (iii) vote for the election of all these
director nominees other than any nominee with respect to whom the shareholder
withholds authority to vote by so indicating in the appropriate space on the
proxy. Withholding authority to vote for a director nominee will not prevent
such director nominee from being elected.
A proxy submitted by a shareholder may indicate that all or a portion of the
shares represented by the proxy are not being voted by that shareholder with
respect to a particular matter. This could occur, for example, when a broker is
not permitted to vote stock held in street name on certain matters in the
absence of instructions from the beneficial owner of the stock. The shares
subject to any such proxy which are not being voted with respect to a particular
matter (the "non-voted shares") will not be considered shares present and
entitled to vote on such matter, although such shares may be considered present
and entitled to vote for purposes of determining the presence of a quorum.
Approval of each matter specified in the notice of the meeting requires the
affirmative vote of a majority, or in the case of the election of directors a
plurality, of the shares of common stock present in person or by proxy at the
Annual Meeting and entitled to vote on such matter. Accordingly, non-voted
shares with respect to these matters will not affect the determination of
whether these matters are approved or the outcome of the election of directors.
Abstentions from voting, which may be specified on any proposal other than the
election of directors, will be included for purposes of determining whether the
requisite number of affirmative votes are received on any matters submitted to
the shareholders for a vote. Accordingly, an abstention will have the same
effect as a vote against any of these matters.
SHAREHOLDER PROPOSALS
The Company knows of no shareholder proposals to be considered at the Annual
Meeting. Shareholder proposals
1
<PAGE>
will be eligible for consideration for inclusion in the Proxy Statement for the
2001 Annual Meeting if they are received by the Secretary of the Company no
later than December 15, 2000 at the address set forth above. If a shareholder,
who intends to present a proposal at the Company's 2001 Annual Meeting and has
not sought inclusion of the proposal in the Company's proxy materials pursuant
to Rule 14a-8, fails to provide the Company with notice of such proposal by
February 26, 2001, then the persons named in the proxies solicited by the
Company's Board of Directors for its 2001 Annual Meeting of Shareholders may
exercise discretionary voting power with respect to that proposal.
ELECTION OF DIRECTORS
Proxy holders named on the proxy card will vote "FOR" the election of the
nominees listed below, unless otherwise instructed on the proxy cards that have
been signed and returned. If you do not wish your shares to be voted for
particular nominees, please identify the exceptions on the proxy card. If any
of these nominees should be unable to serve, the proxies will be voted by the
proxy holders for the election of any other person as the proxies determine, in
accordance with their judgment. Directors are elected for one-year terms. The
Board of Directors recommends a vote "FOR" each of the following nominees for
directors.
Name Age Position
- ---- --- --------
Eddy L. Patterson 58 Director, Chairman and Chief Executive Officer
Albert A. McCutchan 59 Director and Executive Vice President
Edward R. Foraker 61 Director
Dallin Bagley 61 Director
Robert D. Sumner 58 Director
The business background of the Directors follows:
Eddy L. Patterson has served as Chairman, Chief Executive Officer and a
director of the Company since May 1989. Mr. Patterson also serves as Chairman
and a director of Lab One Analytical, Inc. ("Lab One"), Chairman and director of
Fuel Recovery Systems, Inc.("FRS"), President and director of THH Alpha, Inc.,
President and director of Carolina Drilling Services, Inc., and director of
Summit Environmental Services, Inc., wholly owned subsidiaries of the Company.
Mr. Patterson was formerly the owner of an oil and gas production company and a
small manufacturing company.
Albert A. McCutchan served as Executive Vice President and a director of
the Company since May 1989. Mr. McCutchan retired from his position as Executive
Vice President in September, 1999, a position he has held since 1989.
Edward R. Foraker has served as a director of the Company since April 1994.
Since 1970, Mr. Foraker has served as President and Chairman of the Board of
Directors of ECC Energy Corporation and its predecessor corporations. Mr.
Foraker also served as President of WestAmerica Investment Group, Inc. until its
sale in 1997. ECC Energy Corporation engages in coalbed methane gas exploration,
development and production and oil field service contracting. ECC's
headquarters is located in Dewey, Oklahoma.
Dallin Bagley has served as a director of the Company since February, 1999.
Mr. Bagley began practicing law in 1996. During the past six years Mr. Bagley
has served as Vice President of National Financial Services, Inc., a computer
back-up accounting firm for health and fitness clubs. Mr. Bagley is also
currently a director of Tunex International, a chain of automotive engine
performance and service centers, and Gentner Communications Corporation, a
corporation that provides technology, service, and educational solutions for
U.S. and international communications markets. Mr. Bagley received a Juris
Doctorate in l965 from the University of Utah College of
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Law.
Robert W. Sumner has been nominated to serve as a director of the Company.
Mr. Sumner is the owner of Horne Oil Company, Enid, Oklahoma, a provider of fuel
and lubricants. Mr. Sumner has been with that company since 1983 and has served
as president since 1995.
BOARD COMPENSATION AND COMMITTEES
The Company pays each non-employee member of its Board of Directors $1,250 for
each quarterly Board meeting which he attends. Directors are not compensated
for special meetings. Directors are not currently reimbursed for their expenses
incurred in attending meetings.
During 1999, there were four regular quarterly board meetings and one special
board meeting. No director attended less than 75% of the board meetings and
meetings of those committees on which he served.
W. F. Simpson, E. R. Foraker, and Dallin Bagley served on both the Audit and
Compensation Committees. Mr. McCutchan was appointed to serve on the Audit and
Compensation committees at the February 3, 2000, board meeting.
The primary functions of the Audit Committee are to monitor the Company's
internal accounting controls, review the annual financial information and review
the services and fees of the independent auditors. The Audit Committee met one
time during the fiscal year ended December 31, 1999.
The primary functions of the Compensation Committee are to review and approve
management's recommendations concerning compensation of executive officers and
certain other employees and to administer the Company's 1994 Employee Stock
Plan. The Compensation Committee, acting as the Equity Incentive Plan
Committee, has the authority, in its discretion, to select the eligible officers
and employees to whom options shall be granted and the number of shares of the
Company's Common Stock to be subject to such options. The Compensation
Committee met one time during the fiscal year ended December 31, 1999. The
Company has no standing nominating committee.
EXECUTIVE OFFICERS
Executive Officers that are not directors of the Company and their business
backgrounds are as follows:
James Howell, President , age 46, received a B.S. degree from Oklahoma State
University in Agricultural Engineering. Mr. Howell has held marketing
and management positions with several national companies including Network
Security Corporation and Mosler, Inc. Mr. Howell joined the Company in
1989 as Director of Marketing. Mr. Howell has been the Vice President-
Marketing since January 1, 1995 and was elected as President in June, 1998.
Larry G. Johnson, Vice President, Secretary-Treasurer and Chief Financial
Officer, age 54, has served in these capacities since January 1, 1995. Mr.
Johnson also has served as the President of Lab One since March 1993. Mr.
Johnson has been employed by the Company since 1993. From April 1992 to
January 1993, Mr. Johnson served as a consultant to the Company. From 1971
to 1991, Mr. Johnson was employed by Broken Arrow Federal Savings and Loan
and served as President and Chief Executive Officer for 16 of those years.
Mr. Johnson holds an M.B.A. degree from the University of Tulsa.
Chuck Nance, Vice President-Operations, age 53, has over 20 years of experience
in service station construction and underground storage tank installation.
Mr. Nance joined the Company in 1991 as a project manager and is licensed
in several states to perform all aspects of underground storage services.
Mr. Nance was named Vice President-Operations on January 1, 1995. Prior
to joining the Company , Mr. Nance was a construction manager for over nine
years with Petroleum Marketers Equipment Company, Inc.
3
<PAGE>
Robert Watson, Controller, age 53, received his degree, with honors, from the
University of Arkansas in 1969. With over 20 years experience as a CPA,
including seven years with the international firm of Arthur Young & Co.
(now Ernst & Young LLP), he joined NESCO in 1996. Mr. Watson was the
Controller and Corporate Secretary-Treasurer for Lake Country Beverage,
Inc. from October 1986 to November 1995 and was a business consultant from
November 1995 to May 1996. Mr. Watson oversees all day to day corporate
accounting functions.
Executive Compensation
The following table sets forth certain information concerning the annual and
long-term compensation for the three principal executive officers of the Company
(including Mr. McCutchan who retired in September, 1999). Because no other
executive officer of the Company received cash compensation exceeding $100,000
during the year ended December 31, 1999, no disclosure pertaining to other
executives is required or provided.
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term Compensation
----------------------------------
Annual Compensation Awards Payments
------------------------------------------- ---------------------- ----------
Restrict- Securities
ed Under
Annual Compensation Stock lying LTIP All other
-------------------------------------------
Name and Other Annual Awards Options/ Payouts Compen-
Principal Position Year Salary Bonus Compensation ($) SAR(#) ($) sation
- ------------------ ---- ------ ----- ------------ --------- -------- ---------- ------
Compensation
- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Eddy L. Patterson, 1999 $200,000 $ - (1)
Chairman & Chief 1998 $148,077 $ 25,000 (1)
Executive Officer 1997 $105,042 $ 20,484 (1)
Albert A. McCutchan 1999 $115,818 $ - (1)
Executive vice President 1998 $129,151 $ 20,000 (1)
1997 $ 98,286 $ 18,435 (1)
James Howell 1999 $111,260 $ - (1)
President 1998 $ 86,094 $ - (1) 25,000(2)
1997 $ 65,804 $ - (1)
</TABLE>
(1) Other annual compensation did not exceed the lesser of $50,000 or 10% of
the executive's annual salary and bonus for any of the executive officers.
(2) In June, 1998, Mr. Howell was awarded 25,000 shares with an exercise price
of $2.00 per share.
4
<PAGE>
Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options at Fiscal Year- In-the-Money Options at
End (#) Fiscal Year-End ($)
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise (#) Realized ($) Unexercisable Unexercisable (1)
- ---- --------------- ------------ ------------- -----------------
<S> <C> <C> <C> <C>
Eddy L. Patterson - - 0/0 0/0
Albert A. McCutchan - - 0/0 0/0
James Howell - - 41,000/4,000 $21,875/0
</TABLE>
_____________
(1) The value of the unexercised in-the-money options is calculated by
multiplying (a) the difference between (i) the closing price of $2.875 for
the last business day of the fiscal year ended December 31, 1999, and (ii)
the option exercise price by (b) the number of securities underlying the
options.
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information as of April 7, 2000,
regarding the ownership of the Company's common stock by (a) all persons known
by the Company to be beneficial owners of more than 5% of the outstanding common
stock, (b) each director and nominee for director of the Company, (c) each of
the executive officers of the Company named in the Summary Compensation Table,
and (d) all executive officers and directors of the Company as a group. There
is no other class of securities of the Company entitled to vote at the Annual
Meeting.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP PERCENT OF CLASS
- ------------------- ----------------------- ----------------
<S> <C> <C>
Eddy L. Patterson 2,984,258 shares 32.2%
12331 E. 60th St.
Tulsa, Oklahoma 74146
Albert A. McCutchan 170,205 shares(1) 1.8%
12331 E. 60th St.
Tulsa, Oklahoma 74146
E.R. Foraker 293,678 shares(2) 3.2%
4141 North Scottsdale Road
Suite 100
Scottsdale, Arizona 85251
Dallin Bagley 1,397,500 shares 15.1%
2350 Oakhill Drive
Salt Lake City, Utah 84121
Robert W. Sumner 339,885 shares 3.2%
2822 Oakleaf Circle
Enid, Oklahoma 73703
</TABLE>
5
<PAGE>
Wesley Hill 684,990 shares 7.4%
1625 West Owen K. Garriott
Suite D
Enid, Oklahoma 73703
James Howell 69,574 shares(3) .8%
1425 Jamestown
Edmond, Oklahoma 73003
All directors and executive officers
as a group of eight persons 5,296,718 shares 57.2%
- ----------------------------------
(1) Mr. McCutchan's shares include 45,164 shares owned by his wife. Mr.
McCutchan disclaims beneficial ownership of such shares.
(2) Mr. Foraker's beneficial shares of 293,678 shares include 6,806 shares
owned by his wife, 5,000 shares owned by his children, and 90 shares owned
by his grandchildren. Mr. Foraker disclaims beneficial ownership of such
shares.
(3) Mr. Howell's shares include stock options for 45,000 shares which are fully
exercisable.
Except as otherwise indicated, all of the persons named above have sole voting
and investment power with respect to the shares beneficially owned by them.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's directors, executive officers and shareholders who own more than 10%
of the Company's outstanding common stock to report to the Securities and
Exchange Commission their initial ownership of the common stock and any
subsequent changes in that ownership and to furnish the Company with a copy of
each report. The regulations of the Securities and Exchange Commission impose
specific due dates for such reports, and the Company is required to disclose in
this Proxy Statement any failure to file by these dates during and with respect
to fiscal year 1999.
To the Company's knowledge, based solely on review of the copies of the reports
furnished to the Company and written representations that no other reports were
required during and with respect to fiscal 1999, all Section 16(a) filing
requirements applicable to its officers, directors and holders of more than 10%
of its outstanding shares of common stock were complied with.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Lab One Analytical, Inc. ("Lab One") was acquired by the Company from Eddy L.
Patterson and Albert A. McCutchan, executive officers and directors of the
Company, on January 30, 1998, for $75,000 cash and 225,000 shares of the
Company's common stock following the completion of an independent appraisal of
Lab One and the review and unanimous consent of the outside directors of the
company as to the transaction and the terms and conditions thereof.
The Company leased its Tulsa office and warehouse space from McCutchan-Patterson
Partnership, a partnership wholly-owned by Messrs. Patterson and McCutchan. The
lease ran from July 1, 1995 through December 31, 1997 and called for monthly
lease payments by the Company of $5,500. On February 28, 1998, the Company
acquired the office building, warehouse, and lot on which the Company's
corporate office is located. The purchase price of $600,000 was established by
an independent appraisal of the property. The acquisition was approved by
unanimous consent of the outside directors of the Company after a review of the
appraisal and the terms and conditions of the purchase.
<PAGE>
EQUITY INCENTIVE PLAN
The Board of Directors is requesting that the shareholders of the Company
approve the NESCO, Inc. 2000 Equity Incentive Plan (the "2000 Plan"). In April
of 2000, the Board of Directors adopted the 2000 Plan to enable the Company to
recruit, retain and motivate qualified directors, officers and employees who are
essential to the success of the Company. The 2000 Plan is also designed to
enhance the profitability and value of the Company for the benefit of its
shareholders by providing stock and cash awards to officers and other key
employees who make important contributions to the success of the Company. A
summary of the major features of the 2000 Plan are outlined below. The
affirmative vote of the holders of a majority of the aggregate shares of common
stock present in person or by proxy at the Annual Meeting and entitled to vote
is required for approval of the 2000 Plan.
The Board of Directors recommends a vote "FOR" approval of the 2000 Plan.
Eligible Participants. The 2000 Plan permits the granting of benefits to (a) key
employees and directors of the Company and (b) the NESCO, Inc. Employees Savings
Trust Plan account of an employee. Although a determination has not been made as
to the number of employees and non-employee directors currently eligible for
consideration as participants in the 2000 Plan, 25 employees currently hold
options granted under the 1994 Employee Stock Plan covering a total of 282,000
shares. The Board of Directors has terminated the 1994 Employee Stock Plan and
the 1994 Director Stock Plan so that additional options may not be granted under
those plans.
Shares Reserved for Issuance. Under the 2000 Plan, the amount of common stock
initially available for issuance is 643,586 shares. However, if any of the
options granted under the 1994 Employee Stock Plan are terminated or canceled
without being exercised, the shares subject to those options will become
available under the 2000 Plan. Additionally, the number of shares available for
certain grants under the 2000 Plan will increase or decrease so that the total
number available equals 10% of the total number of issued and outstanding shares
of the Company's common stock.
Administration. The 2000 Plan is to be administered by the Compensation
Committee of the Board of Directors. The Committee is authorized to determine
plan participants, the types and amounts of benefits granted and the terms,
conditions, provisions and restrictions of benefits, prescribe the form and
content of benefit agreements, interpret and determine all questions relating to
the 2000 Plan, establish, amend and rescind rules and regulations relating to
the 2000 Plan, maintain accounts and records relating to benefits and the
Committee's decisions and proceedings, employ agents for such purposes as the
Committee considers appropriate, and make all other determinations and perform
all acts which may be necessary or advisable for the administration of the 2000
Plan.
Summary of Benefit Awards. The 2000 Plan permits the granting of any or all of
the following types of benefits: (a) stock options; (b) stock appreciation
rights ("SARs"); (c) restricted stock; and (d) performance shares. Generally,
benefits under the 2000 Plan are granted for no consideration other than prior
and future services. Benefits granted under the 2000 Plan may, in the discretion
of the Committee, be granted individually or in tandem with any other benefit
under the 2000 Plan, except that incentive stock options may not be granted in
tandem with any other Benefit other than SARs. The 2000 Plan limits benefits
that may be granted to one participant in any one calendar year to not more than
300,000 shares. The Company may, at the time any distribution is made under the
2000 Plan or at the time any option is exercised, withhold from the distribution
or shares of common stock any amount necessary to satisfy federal, state or
local withholding requirements.
Stock Options. Stock options granted pursuant to the 2000 Plan may, at the
-------------
discretion of the Committee, be either incentive stock options ("ISOs"), within
the meaning of Section 422 of the Internal Revenue Code or non-qualified stock
options. The terms of all options under the 2000 Plan will be determined by the
Committee, except that the exercise price of any stock option may not be less
that the fair market value of the common stock on the date of grant and no more
than 643,586 shares of common stock may be issued upon the exercise of ISOs
granted under the 2000 Plan. The grant of ISOs may only be made to employees.
Generally, options and other benefits that require upon exercise a payment by
the participant to the Company may be so exercised by the payment of cash.
However, upon the consent of the Committee or to the extent provided in a
particular benefit agreement, payments may be in the form of the surrender of
all or part of any 2000 Plan benefits, stock, other property
7
<PAGE>
including promissory notes, or any combination of the foregoing, including cash.
Stock Appreciation Rights. Any SARs granted under the 2000 Plan will give
-------------------------
the holder the right to receive cash, stock, or any combination thereof as the
Committee may determine, in an amount equal to the difference between the fair
market value of a share of common stock on the date of payment and the grant
date. Methods of exercise and other terms of SARs are determined by the
Committee under the 2000 Plan.
Restricted Stock. The Committee may award restricted stock with such
----------------
terms, conditions, and at such cost, as the Committee may determine. Often,
restricted shares are and may be issued for no monetary. Generally, restricted
stock consists of shares which may not be disposed of by participants until
certain restrictions established by the Committee lapse. If the conditions or
restrictions or not met, the restricted shares are generally forfeited and
returned to the Company. The Committee has the discretion to determine whether
the restricted stock that is granted has full voting rights or not, and the
Committee may require that any dividends on restricted stock be automatically
deferred and reinvested in additional restricted stock having the same
restrictions as the underlying benefit.
Performance Shares. The Committee may award performance shares with such
------------------
terms and conditions as determined by the Committee, but generally it is
expected that the award of performance shares will be based upon the attainment
of targeted financial performance objectives. Performance shares represent the
right of a participant to receive shares or cash equal to the fair market value
of such shares at a future date in accordance with the terms and conditions of
the grant.
Dividend Equivalents. In addition, grants of benefits in common stock or
--------------------
common stock equivalents may include dividend or dividend equivalent payments or
dividend credit rights. For example, the Committee may include in a benefit a
dividend credit right entitling the recipient to receive amounts equal to the
ordinary dividends that would have been paid, during the time such benefit is
outstanding, unexercised or not vested, on the shares of common stock covered by
such benefit if such shares were then outstanding.
Transferability. Benefits under the 2000 Plan are not transferable except for
transfers (a) to the Company, (b) by will or the laws of descent and
distribution, (c) pursuant to domestic relations orders, (d) of the right to
exercise benefits on behalf of a participant by his or her legal representative
where the participant has suffered a disability, or (e) in connection with
cashless exercise procedures with third parties authorized by the Committee. The
Committee may permit benefits to be transferred to and exercised by family
members, charitable institutions, trusts or other entities whose beneficiaries
or beneficial owners are members of the participants immediate family or
charitable institutions, or other person or entities the Committee approves.
Adjustment Provisions. In the event of any change affecting the shares of common
stock by reason of any stock split, stock dividend, spin-off, spin-out,
recapitalization, merger, consolidation, reorganization, combination or exchange
of shares, or any other similar transaction, the number of shares available for
grant under the 2000 Plan or subject to or granted pursuant to a benefit and the
price thereof, as applicable, will be appropriately adjusted by the Committee.
Term, Amendment to, and Termination of the 2000 Plan. The 2000 Plan will
commence upon shareholder approval and will continue for a period of ten years
unless earlier terminated by the Committee. No benefits will be granted under
the 2000 Plan after termination, but benefits granted prior to termination may
extend beyond the termination date to the date specified in the benefit
agreement. The Committee may amend the 2000 Plan at any time and from time to
time.
Change of Control. In the event of a Change of Control of the Company as defined
in the 2000 Plan, all outstanding benefits under the 2000 Plan, regardless of
any limitations or restrictions except those imposed by applicable law, become
fully exercisable or payable and freed of all restrictions.
Federal Income Tax Consequences. The Company believes that under present Federal
tax laws the following are the Federal income tax consequences generally arising
with respect to benefits granted under the 2000 Plan. The
8
<PAGE>
grant of an option or SAR will create no tax consequences for the participant or
the Company. The participant will not have taxable income upon exercising an ISO
(except that the alternative minimum tax may apply) and the Company will receive
no deduction. Upon exercising an option other than an ISO, a participant will
recognize income equal to the difference between the exercise price and the fair
market value of the stock acquired on the date of exercise. Upon exercising an
SAR, a participant will recognize ordinary income equal to the cash or the fair
market value of the stock received on the date of exercise. In the case of the
exercise of a non-qualified stock option or SAR, the Company generally will be
entitled to a deduction for the amount recognized as ordinary income by the
participant. The treatment to a participant of a disposition of shares acquired
upon the exercise of an SAR or option depends on how long the shares have been
held and on whether such shares are acquired by exercising an ISO or by
exercising an option other than an ISO. Generally, there will be not tax
consequences to the Company in connection with a disposition of shares acquired
under an option except that the Company will be entitled to a deduction (and the
employee will recognize ordinary income) if shares acquired under an ISO are
disposed of before the applicable ISO holding periods have been satisfied.
With respect to benefits granted under the 2000 Plan involving stock that is
restricted as to transferability and subject to a substantial risk of
forfeiture, a participant will recognize ordinary income equal to the fair
market value of the shares received at the earlier of the time at which the
shares became transferable or not subject to a substantial risk of forfeiture
unless the participant elects to be taxed at the time of the award
notwithstanding the restrictions (to minimize the tax payable in respect of the
appreciation in the value of the stock from the time it is awarded until the
restrictions lapse). The Company generally will be entitled to a deduction for
the same amount.
Performance share benefits may also be granted under the 2000 Plan. Participants
receiving common stock pursuant to a performance share benefit generally will
recognize ordinary income equal to the fair market value of the shares received.
The Company will generally be entitled to a corresponding deduction. Upon the
disposition of such stock, the participant will generally recognize capital
gains or loss.
This discussion presents only a very general description of the application of
Federal income tax laws to benefits under the 2000 Plan. The discussion does not
address the effects of foreign, state and local tax laws.
Awards Granted. As of the date of this proxy statement, there has been no
determination by the Board of Directors or the Committee with respect to future
benefit awards under the 2000 Plan. Had the 2000 Plan been in effect for the
1999 fiscal year, the benefits to the named officers and to non-employee
directors would have been as follows (based on actual grants made under existing
plans) for (1) the named officers, (2) all current executive officers as a
group, (3) all current directors who are not executive officers, as a group, and
(4) all employees, including all current officers who are not executive
officers, as a group:
<TABLE>
<CAPTION>
Name and Position Options Granted Value ($) (1)
- ----------------- --------------- ---------
<S> <C> <C>
Eddy Patterson, Chairman & Chief Executive Officer..... 0 0
Albert McCutchan, Executive Vice President............. 0 0
James Howell, President................................ 0 0
All current executive officers as a group.............. 0 0
All current directors who are not
executive officers, as a group......................... 0 0
All employees, including all current officers
who are not executive officers, as a group............. 75,000 $65,625
</TABLE>
________________
(1) Value shown is the closing price of the Company's common stock on December
31, 1999 as reported on the Nasdaq SmallCap Market ($2.875 per share), minus the
per share exercise price ($2.00), multiplied by the number of shares underlying
the options.
INDEPENDENT AUDITORS
Tullius Taylor Sartain & Sartain LLP served as the Company's independent
auditors during 1999 and have been chosen by the Board of Directors to serve in
that capacity for 2000. A proposal will be presented at the Annual
9
<PAGE>
Meeting to ratify Tullius Taylor Sartain & Sartain LLP as the Company's
independent auditors. If the shareholders do not ratify this appointment, the
Board of Directors will reconsider the appointment.
The Board of Directors recommends a for "FOR" the ratification of Tullius Taylor
Sartain & Sartain LLP as the Company's independent auditors for 2000.
Representatives of Tullius Taylor Sartain and Sartain LLP will be present at the
Annual Meeting to respond to appropriate questions from shareholders and to make
a statement if they desire to do so.
OTHER MATTERS
The Company will bear the cost of the proxy solicitation. In addition to
solicitation by mail, the Company will request banks, brokers and other
custodian nominees and fiduciaries to supply solicitation materials by mail to
the beneficial owners of the Company's common stock of whom they have knowledge,
and will reimburse them for their expenses in so doing; and certain directors,
officers and employees of the Company, not employed for the purpose, may solicit
proxies, without additional remuneration therefore, by personal interview, mail,
telephone or telegraph.
MATTERS WHICH MAY COME BEFORE THE MEETING
The Board of Directors does not intend to bring any other matters before the
Annual Meeting, nor does the Board of Directors know of any matters which other
persons intend to bring before the Annual Meeting. If, however, other matters
not mentioned in this Proxy Statement properly come before the meeting, the
persons named in the accompanying Proxy Card will vote thereon in accordance
with the recommendation of the Board of Directors.
REMINDER: PLEASE SIGN, DATE AND RETURN YOUR PROXY CARD TO ASSURE THAT ALL OF
YOUR SHARES WILL BE VOTED.
10
<PAGE>
NESCO, INC. 2000 EQUITY INCENTIVE PLAN
ARTICLE I
NAME AND PURPOSE
1.1 Name. The name of this Plan is the "NESCO, Inc. 2000 Equity Incentive
----
Plan."
1.2 Purpose. The purpose of the Plan is to enhance the profitability and value
-------
of the Company for the benefit of its shareholders by providing equity
ownership opportunities and performance based incentives to better align
the interests of officers, key employees and Directors with those of
shareholders. The Plan is also designed to enhance the profitability and
value of the Company for the benefit of its shareholders by providing stock
and cash awards to attract, retain and motivate officers and other key
employees who make important contributions to the success of the Company.
ARTICLE II
DEFINITIONS OF TERMS AND RULES OF CONSTRUCTION
2.1 General Definitions. The following words and phrases, when used in the
-------------------
Plan, unless otherwise specifically defined or unless the context clearly
otherwise requires, shall have the following respective meanings:
(a) Affiliate. A Parent, or Subsidiary of the Company or any other entity
---------
designated by the Committee in which the Company owns at least a 50%
interest (including, but not limited to, partnerships and joint
ventures).
(b) Agreement. The document which evidences the grant of any Benefit
---------
under the Plan and which sets forth the Benefit and the terms,
conditions and provisions of, and restrictions relating to, such
Benefit.
(c) Benefit. Any benefit granted to a Participant under the Plan.
-------
(d) Board. The Board of Directors of the Company.
-----
(e) Change of Control. The occurrence of any one of the following events:
-----------------
(i) The acquisition at any time by a "person" or "group" (as that
term is used in Sections 13(d) and 14(d)(2) of the Exchange Act)
(excluding, for this purpose, the Company or any Subsidiary or
any employee benefit plan of the Company or any Subsidiary) of
beneficial ownership (as defined in Rule 13d-3 under the Exchange
Act) directly or indirectly, of securities representing 20% or
more of the combined voting power in the election of directors of
the then-outstanding securities of the Company or any successor
of the Company;
(ii) Individuals who, as of the beginning of any twenty-four month
period, constitute the Board (the "Incumbent Board") cease for
any reason to
<PAGE>
constitute at least a majority of the Board, provided that any
individual becoming a Director subsequent to the beginning of
such period whose election or nomination for election by the
Company's shareholders was approved by a vote of at least a
majority of the Directors then comprising the Incumbent Board
shall be considered as though such individual were a member of
the Incumbent Board, but excluding for this purpose any such
individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the
election of the Directors of the Company (as such terms are used
in Rule 14a-11 of Regulation 14A promulgated under the Exchange
Act);
(iii) Approval by the shareholders of the Company of any merger or
consolidation or statutory share exchange as a result of which
the Common Stock shall be changed, converted or exchanged (other
than a merger or share exchange with a wholly-owned Subsidiary
of the Company) or liquidation of the Company or any sale or
disposition of 50% or more of the assets or earning power of the
Company; or
(iv) Approval by the shareholders of the Company of any merger or
consolidation or statutory share exchange to which the Company
is a party as a result of which the persons who were
shareholders of the Company immediately prior to the effective
date of the merger or consolidation or statutory share exchange
shall have beneficial ownership of less than 50% of the combined
voting power in the election of directors of the surviving
corporation following the effective date of such merger or
consolidation or statutory share exchange; provided, however,
that no Change of Control shall be deemed to have occurred if,
prior to such time as a Change of Control would otherwise be
deemed to have occurred, the Company's Board of Directors deems
otherwise. A "Change of Control" shall not include any reduction
in ownership of an Affiliate so long as the entity continues to
meet the definitions of those terms as contained in this
Section.
(f) Code. The Internal Revenue Code of 1986, as amended. Any reference to
----
the Code includes the regulations promulgated pursuant to the Code.
(g) Company. NESCO, Inc.
-------
(h) Committee. The Company's Compensation Committee or its successor.
---------
(i) Common Stock. The Company's $0.01 par value common stock.
------------
(j) Director(s). A member or members of the Board.
-----------
2
<PAGE>
(k) Disability. Being unable to engage in any substantial gainful
----------
activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has
lasted or can be expected to last for a continuous period of not less
than 12 months.
(l) Effective Date. The date that the Plan is approved by the
--------------
shareholders of the Company which must occur within one year after
approval by the Board. Any grants of Benefits prior to the approval by
the shareholders of the Company shall be void if such approval is not
obtained.
(m) Employee. Any person employed by the Employer.
--------
(n) Employer. The Company and all Affiliates.
--------
(o) Exchange Act. The Securities Exchange Act of 1934, as amended.
------------
(p) Fair Market Value. For the relevant day, whichever of the following is
-----------------
applicable:
(i) If shares of Common Stock are listed or admitted to unlisted
trading privileges on any national or regional securities
exchange, the last reported sale price, regular way, on the
composite tape of that exchange on the day Fair Market Value is
to be determined;
(ii) If the Common Stock is not listed or admitted to unlisted
trading privileges as provided in paragraph (a), and if sales
prices for shares of Common Stock are reported by the National
Market System of the National Association of Securities Dealers
Automated Quotation System ("NASDAQ System"), then the last sale
price for Common Stock reported as of the close of business on
the day Fair Market Value is to be determined, or if no such
sale takes place on that day, the average of the high bid and
low asked prices so reported for such day; or
(iii) If trading of the Common Stock is not reported by the NASDAQ
System or on a stock exchange, Fair Market Value will be
determined by the Board in its discretion based upon the best
available data.
(q) Fiscal Year. The taxable year of the Company which is the calendar
-----------
year.
(r) ISO. An Incentive Stock Option as defined in Section 422 of the Code.
---
(s) NQSO. A Non-Qualified Stock Option, which is an Option that does not
----
meet the statutory requirements of an ISO.
(t) Option. An option to purchase Shares granted under the Plan.
------
3
<PAGE>
(u) Parent. Any corporation (other than the Company or a Subsidiary) in
------
an unbroken chain of corporations ending with the Company, if, at the
time of the grant of an Option or other Benefit, each of the
corporations (other than the Company or a Subsidiary) owns stock
possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
(v) Participant. An Employee or Director who is granted a Benefit under
-----------
the Plan. ISO's may be granted only to Employees.
(w) Performance Share. A Share awarded to a Participant under ARTICLE XVI
-----------------
of the Plan.
(x) Plan. The NESCO, Inc. 2000 Equity Incentive Plan and all amendments
----
and supplements to it.
(y) Restricted Stock. Shares issued under ARTICLE XV of the Plan.
----------------
(z) Rule 16b-3. Rule 16b-3 promulgated by the SEC, as amended, or any
----------
successor rule in effect from time to time.
(aa) SAR. A Stock Appreciation Right, which is the right to receive an
---
amount equal to the appreciation, if any, in the Fair Market Value of
a Share from the date of the grant of the right to the date of its
payment.
(bb) SEC. The Securities and Exchange Commission.
---
(cc) Share. A share of Common Stock.
-----
(dd) Subsidiary. Any corporation, other than the Company, in an unbroken
----------
chain of corporation beginning with the Company if, at the time of
grant of an Option or other Benefit, each of the corporations, other
than the last corporation in the unbroken chain, owns stock possessing
50% or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.
(ee) Termination of Employment.
-------------------------
(i) With respect to an Employee, when the Employee's employment
relationship with the Company and all of its Subsidiaries is
terminated, regardless of any severance arrangements. A transfer
from the Company to a Subsidiary or Affiliate of the Company or a
Subsidiary, or vice versa, is not a termination of employment for
---- -----
purposes of the Plan; or
(ii) With respect to a Director, when such individual is no longer
serving as a Director of the Company.
4
<PAGE>
2.2 Other Definitions. In addition to the above definitions, certain words and
-----------------
phrases used in the Plan and any Agreement may be defined in other portions
of the Plan or in such Agreement.
2.3 Conflicts in Plan. In the case of any conflict in the terms of the Plan,
-----------------
or between the Plan and an Agreement, relating to a Benefit, the provisions
in the ARTICLE of the Plan which specifically grants such Benefit shall
control those in a different ARTICLE or in such Agreement.
ARTICLE III
COMMON STOCK
3.1 Number of Shares. The number of Shares which may be issued or sold or for
----------------
which Options, SARs, Restricted Stock or Performance Shares may be granted
under the Plan shall be Nine Hundred Twenty-Five Thousand Five Hundred
Eighty-Six (925,586) (or such greater or lesser number of shares that
equals ten percent (10%) of the issued and outstanding shares of Common
Stock) less that number of shares of Shares issuable upon the exercise of
stock options granted under the National Environmental Services Co. 1994
Employee Stock Plan and the National Environmental Services Co. 1994
Director Stock Plan. Such number of shares available under this Plan shall
be increased automatically without further action by the Board of Directors
or shareholders of the Company to that number which, when added to the
number of shares subject to Options granted under this Plan and any other
stock plan(s) of the Company equals ten percent (10%) of the issued and
outstanding shares of Common Stock at such time(s) as the Company issues
additional shares of Common Stock (excluding for purposes of determining
the number of shares available under this Plan and the time(s) of such
automatic increases all shares of Common Stock issued pursuant to this Plan
and any other stock plan(s) of the Company and all shares of Common Stock
in the Company's Treasury). During the term of this Plan, Benefits
representing no more than Three Hundred Thousand (300,000) of such Shares
may be granted to any one individual in any one calendar year. Such Shares
may be authorized but unissued Shares, reacquired Shares, Shares acquired
on the open market specifically for distribution under this Plan, or any
combination thereof.
3.2 Reusage. If an Option or SAR expires or is terminated, surrendered or
-------
canceled without having been fully exercised, if Restricted Shares or
Performance Shares are forfeited, or if any other grant results in any
Shares not being issued, the unused Shares covered by any such Benefit
shall again be available for grant under the Plan.
3.3 Adjustments. If there is any change in the Common Stock of the Company by
-----------
reason of any stock split, stock dividend, spin-off, split-up, spin-out,
recapitalization, merger, consolidation, reorganization, combination or
exchange of shares, or any other similar transaction, the number of shares
available for grant under the Plan or subject to or granted pursuant to a
Benefit and the price thereof, as applicable, shall be appropriately
adjusted by the Committee.
ARTICLE IV
5
<PAGE>
ELIGIBILITY
4.1 Eligible Participants. Subject to the provisions of the Plan, the persons
---------------------
who shall be eligible to participate in the Plan and be granted a Benefit
shall be those persons who are key Employees and Directors of the Company
or any Subsidiary who shall be in a position, in the opinion of the
Committee, to make contributions to the growth, management, protection, and
success of the Company and its Subsidiaries. Of those persons described in
the preceding sentence, the Committee may, from time to time, select
persons to be granted a Benefit and shall determine the terms and
conditions with respect thereto. In making any such selection and in
determining the form of the Benefit, the Committee may give consideration
to the functions and responsibilities of the person, to the person's
contributions to the Company and its Subsidiaries, the value of the
individual's service to the Company and its Subsidiaries and such other
factors deemed relevant by the Committee. In the event and to the extent
authorized by the United States Departments of Treasury and Labor, the
NESCO, Inc. Employees Savings Trust Plan account of an Employee may also be
a Participant, the Committee may grant a Benefit to such account and, to
the extent such account is a Participant, the Benefit in such an account
shall be subject to all of the terms and provisions of the Plan as if the
Benefit had been granted to the individual for whom the account is
maintained.
ARTICLE V
ADMINISTRATION
5.1 Committee. The Plan shall be administered by the Company's Compensation
---------
Committee or its successor. The Committee shall consist solely of two or
more members of the Board who are "non-employee directors" as defined in
Rule 16b-3 and are "outside directors" as defined in Code Section 162(m)
and the regulations thereunder.
5.2 Authority. Subject to the terms of the Plan, the Committee shall have sole
---------
discretionary authority to:
(a) determine the individuals to whom Benefits are granted, the type and
amounts of Benefits to be granted and the date of issuance and
duration of all such grants;
(b) determine the terms, conditions and provisions of, and restrictions
relating to, each Benefit granted;
(c) interpret and construe the Plan and all Agreements;
(d) prescribe, amend and rescind rules and regulations relating to the
Plan;
(e) determine the content and form of all Agreements;
(f) determine all questions relating to Benefits under the Plan;
6
<PAGE>
(g) maintain accounts, records and ledgers relating to Benefits;
(h) maintain records concerning its decisions and proceedings;
(i) employ agents, attorneys, accountants or other persons for such
purposes as the Committee considers necessary or desirable; and
(j) do and perform all acts which it may deem necessary or appropriate for
the administration of the Plan and to carry out the purposes of the
Plan.
5.3 Delegation. Except as required by Rule 16b-3 with respect to grants of
----------
Options, SARs, Performance Shares, or Restricted Stock to individuals who
are subject to Section 16 of the Exchange Act or as otherwise required for
compliance with Rule 16b-3 or other applicable law, the Committee may
delegate all or any part of its authority under the Plan to any Employee,
Employees or committee of Employees.
5.4 Decisions of Committee and its Delegates. All decisions made by the
----------------------------------------
Committee or (unless the Committee has specified an appeal process to the
contrary) any other person or persons to whom the Committee has delegated
authority pursuant to the provisions hereof shall be final and binding on
all persons.
ARTICLE VI
AMENDMENT OF PLAN
6.1 Power of Committee. The Committee shall have the sole right and power to
------------------
amend the Plan at any time and from time to time; provided, however, that
the Committee may not amend the Plan, without approval of the shareholders
of the Company, in a manner which would:
(a) cause Options which are intended to qualify as ISOs to fail to
qualify;
(b) cause the Plan to fail to meet the requirements of Rule 16b-3; or
(c) violate applicable law.
ARTICLE VII
TERM AND TERMINATION OF PLAN
7.1 Term. The Plan shall commence as of the Effective Date. No Benefit shall
----
be granted pursuant to the Plan on or after the tenth anniversary date of
the Effective Date, but Benefits granted prior to such tenth anniversary
may extend beyond that date to the date(s) specified in the Agreement(s)
covering such Benefits.
7.2 Termination. Subject to ARTICLE VIII, the Plan may be terminated at any
-----------
time by the Committee.
7
<PAGE>
ARTICLE VIII
MODIFICATION OR TERMINATION OF BENEFITS
8.1 General. Subject to the provisions of Section 8.2, the amendment or
-------
termination of the Plan shall not adversely affect a Participant's rights
to or under any Benefit granted prior to such amendment or termination.
8.2 Committee's Right. Except as may be provided in an Agreement, any Benefit
-----------------
granted may be converted, modified, forfeited or canceled, prospectively or
retroactively, in whole or in part, by the Committee in its sole
discretion, but, subject to Section 8.3, no such action may impair the
rights of any Participant without his or her consent. Except as may be
provided in an Agreement, the Committee may, in its sole discretion, in
whole or in part, waive any restrictions or conditions applicable to, or
accelerate the vesting of, any Benefit.
8.3 Termination of Benefits under Certain Conditions. The Committee in its
------------------------------------------------
sole discretion may cancel any unexpired, unpaid, or deferred Benefits at
any time if the Participant is not in compliance with all applicable
provisions of this Plan or with any Agreement or if the Participant,
whether or not he or she is currently employed by an Employer, acts in a
manner contrary to the best interests of the Company or any Affiliate.
8.4 Awards to Foreign Nationals and Employees Outside the United States. To
-------------------------------------------------------------------
the extent the Committee deems it necessary, appropriate or desirable to
comply with foreign law or practice and to further the purpose of this
Plan, the Committee may, without amending this Plan, (i) establish special
rules applicable to Benefits granted to Participants who are foreign
nationals, are employed outside the United States, or both, including rules
that differ from those set forth in this Plan, and (ii) grant Benefits to
such Participants in accordance with those rules.
ARTICLE IX
CHANGE OF CONTROL
9.1 Acceleration. Upon a Change of Control, the restrictions and limitations
------------
applicable to any Benefit shall lapse, and such Benefit shall become free
of all restrictions imposed by the Plan (but not restrictions imposed by
any applicable law, including, for example, the restrictions on
transferability of an ISO) and become fully vested to the full extent of
the original grant and all Benefits shall be exercisable or payable for the
full term provided in the applicable Agreement notwithstanding the Change
of Control. Nothing in this Plan shall impose on a Participant the
obligation to exercise any Benefit immediately before or upon a Change of
Control, nor shall the Participant forfeit the right to exercise the
Benefit during the remainder of the original term of the Benefit because of
a Change of Control or because the Participant's employment is terminated
for any reason following a Change of Control.
8
<PAGE>
ARTICLE X
AGREEMENTS
10.1 Grant Evidenced by Agreement. The grant of any Benefit under the Plan may
----------------------------
be evidenced by an Agreement which shall describe the specific Benefit
granted and the terms and conditions of the Benefit. The granting of any
Benefit shall be subject to, and conditioned upon, the recipient's
execution of any Agreement required by the Committee. Except as otherwise
provided in an Agreement, all capitalized terms used in the Agreement shall
have the same meaning as in the Plan, and the Agreement shall be subject to
all of the terms of the Plan.
10.2 Provisions of Agreement. Each Agreement shall contain such provisions as
-----------------------
the Committee shall determine in its sole discretion to be necessary,
desirable and appropriate for the Benefit granted which may include, but
not necessarily be limited to, the following: description of the type of
Benefit; the Benefit's duration; its transferability; if an Option, the
exercise price, the exercise period and the person or persons who may
exercise the Option; the effect upon such Benefit of the Participant's
death, disability, change of duties or termination of employment; the
Benefit's conditions; subject to the provisions of Section 11.2, when, if,
and how any Benefit may be forfeited, converted into another Benefit,
modified, exchanged for another Benefit, or replaced; and the restrictions
on any Shares purchased or granted under the Plan.
ARTICLE XI
TANDEM AWARDS AND REISSUANCE OF OPTIONS
11.1 Tandem Awards. Benefits may be granted by the Committee in its sole
-------------
discretion individually or in tandem, provided, however, that no Benefit
except SARs may be granted in tandem with an ISO.
ARTICLE XII
PAYMENT, DIVIDENDS, DEFERRAL AND WITHHOLDING
12.1 Payment. Upon the exercise of an Option or in the case of any other
-------
Benefit that requires a payment by a Participant to the Company, the amount
due the Company is to be paid:
(a) in cash;
(b) by the surrender of all or part of a Benefit (including the Benefit
being exercised);
(c) by the tender to the Company of Shares owned by the Participant and
registered in his or her name having a Fair Market Value equal to the
amount due to the Company;
(d) in other property, rights and credits, deemed acceptable by the
Committee including the Participant's promissory note; or
9
<PAGE>
(e) by any combination of the payment methods specified in (a) through (d)
above.
Notwithstanding the foregoing, any method of payment other than in cash may
be used only with the consent of the Committee or if and to the extent so
provided in an Agreement. The proceeds of the sale of Shares purchased
pursuant to an Option and any payment to the Company for other Benefits
shall be added to the general funds of the Company or to the reacquired
Shares held by the Company, as the case may be, and used for the corporate
purposes of the Company as the Board shall determine.
12.2 Dividend Equivalents. Grants of Benefits in Shares or Share equivalents
--------------------
may include dividend or dividend equivalent payments or dividend credit
rights.
12.3 Optional Deferral. The right to receive any Benefit under the Plan may, at
-----------------
the request of the Participant, be deferred for such period and upon such
terms as the Committee shall determine, which may include crediting of
dividends on deferrals denominated in Shares.
12.4 Code Section 162(m). The Committee, in its sole discretion, may require
-------------------
that one or more Agreements contain provisions which provide that, in the
event Section 162(m) of the Code, or any successor provision relating to
excessive employee remuneration, would operate to disallow a deduction by
the Company for all or part of any Benefit under the Plan, a Participant's
receipt of the portion of such Benefit that would not be deductible by the
Company shall be deferred until the next succeeding year or years in which
the Participant's remuneration does not exceed the limit set forth in such
provision of the Code.
12.5 Withholding. The Company may, at the time any distribution is made under
-----------
the Plan, whether in cash or in Shares, or at the time any Option is
exercised, withhold from such distribution or Shares issuable upon the
exercise of an Option, any amount necessary to satisfy federal, state or
local withholding requirements with respect to such distribution or
exercise of such Option. Such withholding may be satisfied, at the
Company's option, either by cash or the Company's withholding of Shares.
Agreements may contain withholding provisions applicable only to
Participants who are subject to Section 16 of the Exchange Act.
ARTICLE XIII
OPTIONS
13.1 Types of Options. It is intended that both ISOs and NQSOs may be granted
----------------
by the Committee under the Plan.
13.2 Option Price. The purchase price for Shares under any ISO shall be no less
------------
then the Fair Market Value of the Shares at the time the Option is granted.
13.3 Other Requirements for ISOs. The terms of each Option which is intended to
---------------------------
qualify as an ISO shall meet all requirements of Section 422 of the Code or
any successor statute in effect from time to time. In addition, no more
than Six HundredForty-Three Thousand Five
10
<PAGE>
Hundred Eighty-Six (643,586) shares of Common Stock may be issued upon the
exercise of ISO's granted under the Plan and no ISO may be granted under
the Plan after the tenth anniversary of the date the Plan is approved by
the shareholders of the Company. Any Participant who disposes of shares
acquired upon the exercise of an ISO either (i) within two years after the
date of grant of the Option under which the shares were acquired or (ii)
within one year after the acquisition of such shares shall notify the
Company of such disposition and of the amount realized. Failure by a
Participant to so notify the Company of such a disposition of shares shall
entitle the Company to treat the shares of Common Stock issued to such
Participant as void ab initio or to recover from the Participant the
greater of the value of the shares disposed of as of the date of
disposition or the value of the shares disposed of as of the date the
Company learns of such disposition from either (ii) any amounts due to such
Participant from the Company or a Subsidiary, or (ii) otherwise. The
Company may, at its discretion, place a legend noting the possible
consequences of a Participant's failure to provide such disposition notice
on shares of Common Stock delivered upon the exercise of an ISO.
13.4 NQSOs. The terms of each NQSO shall provide that such Option will not be
-----
treated as an ISO. The purchase price for Shares under any NQSO shall be
no less than the Fair Market Value of the Shares at the time the Option is
granted.
13.5 Determination by Committee. Except as otherwise provided in Section 13.2
--------------------------
through Section 13.4, the terms of all Options shall be determined by the
Committee.
13.6 Rights as a Shareholder. No person shall have any rights as a shareholder
-----------------------
with respect to any shares delivered upon the exercise of an Option until
such time as such Option is validly exercised.
13.7 Vesting. A Participant may not exercise an Option until it has become
-------
vested. The portion of an Option that is vested depends upon the vesting
restrictions, if any, established by the Committee for such Option at the
time of its grant and the period that has elapsed since the grant.
ARTICLE XIV
SARS
14.1 Grant and Payment. The Committee may grant SARs. Upon electing to receive
-----------------
payment of an SAR, a Participant shall receive payment in cash, in Shares,
or in any combination of cash and Shares, as the Committee shall determine.
14.2 Grant of Tandem Award. If SARs are granted in tandem with an Option, the
---------------------
exercise of the Option shall cause a proportional reduction in SARs
standing to a Participant's credit which were granted in tandem with the
Option; and the payment of SARs shall cause a proportional reduction of the
Shares under such Option. If SARs are granted in tandem with an ISO, the
SARs shall have such terms and conditions as shall be required for the ISO
to qualify as an ISO.
11
<PAGE>
14.3 Payment of Award. SARs shall be paid by the Company to a Participant, to
----------------
the extent payment is elected by the Participant (and is otherwise due and
payable), as soon as practicable after the date on which such election is
made.
ARTICLE XV
RESTRICTED STOCK
15.1 Description. The Committee may grant Benefits in Shares as Restricted
-----------
Stock with such terms and conditions as may be determined in the sole
discretion of the Committee. Shares of Restricted Stock shall be issued
and delivered at the time of the grant or as otherwise determined by the
Committee, but shall be subject to forfeiture until provided otherwise in
the applicable Agreement or the Plan. Each certificate representing Shares
of Restricted Stock shall bear a legend referring to the Plan and the risk
of forfeiture of the Shares. At the discretion of the Committee, the
grantee may or may not be entitled to full voting and dividend rights with
respect to all shares of Restricted Stock from the date of grant. The
Committee may (but is not obligated to) require that any dividends on such
shares shall be automatically deferred and reinvested in additional
Restricted Stock subject to the same restrictions as the underlying
Benefit.
15.2 Cost of Restricted Stock. Grants of Shares of Restricted Stock shall be
------------------------
made at such cost as the Committee shall determine and may be issued for no
monetary consideration, subject to applicable state law.
ARTICLE XVI
PERFORMANCE SHARES
16.1 Description. Performance Shares represent the right of a Participant to
-----------
receive Shares or cash equal to the Fair Market Value of such Shares at a
future date in accordance with the terms and conditions of a grant. The
terms and conditions shall be determined by the Committee, in its sole
discretion, but generally are expected to be based substantially upon the
attainment of targeted financial performance objectives.
16.2 Grant. The Committee may grant an award of Performance Shares at such
-----
times, in such amounts and under such terms and conditions as it deems
appropriate.
ARTICLE XVII
MISCELLANEOUS PROVISIONS
17.1 Termination of Employment. In the event of a Participant's Termination of
-------------------------
Employment, the following rules shall apply:
12
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(a) Resignation in order to assume employment, approved by the Company's
Chief Executive Officer, with a governmental, charitable or
educational institution, or business entity affiliated with the
Company:
When a Participant resigns to assume employment, approved by the
Company's Chief Executive Officer, with a governmental, charitable or
educational institution, or business entity in which the Company has
an equity interest, the Committee may (i) authorize the continuation
of Benefits granted prior to termination as if the Participant were
still employed by the Company and (ii) permit the exercise of such
Benefits or lapse of restrictions in respect of Benefits during
periods after such Termination of Employment, but not beyond the
original expiration date of the Benefit. Such actions will not be
authorized to the extent they would cause outstanding ISOs to be
considered to have been modified for purposes of Section 424(h) of the
Code. Unless the Committee determines otherwise, termination of such
approved employment, except to rejoin the Company or accept other
employment which would qualify under this paragraph (a), or
divestiture by the Company of its equity interest in such business
entity, shall be treated as a Termination of Employment pursuant to
paragraph (b), (c) or (d) of this Section 17.1.
(b) Termination of Employment for any reason other than death, disability
or resignation for approved employment pursuant to paragraph (a)
above:
Any Benefit shall expire forthwith; provided, however, that with the
approval of the Committee evidenced by a writing signed by an
executive officer of the Company other than the Participant, unvested
Benefits may be accelerated to vest immediately, any Benefits
exercisable at the time of such termination may be exercised up to a
date after such termination that is determined by the Committee, but
not exceeding five years from the date of such termination and not
beyond the date the Benefit otherwise would have expired in accordance
with the Agreement evidencing such Benefit and/or the restrictions on
the Benefit may be eliminated so that such Benefit is free of such
restrictions at the time of Termination of Employment and not
forfeited upon such Termination of Employment.
(c) Termination of Employment by Reason of the Death of a Participant:
A Participant's estate or beneficiaries shall have a period up to the
later of one year after the Participant's death or the expiration date
specified in the Agreement within which to exercise a Benefit;
provided, however, in the case of ISO's, the Participant's estate or
beneficiaries may exercise an ISO only until the expiration date
specified in the Agreement. Any Benefit may be immediately exercised
in full by the Participant's estate or beneficiaries. In the event the
Participant's estate is closed with exercisable Options then
unexercised, the rights under this paragraph shall pass by will or the
laws of descent and distribution. In the case of Restricted Stock, the
restrictions on such
13
<PAGE>
Restricted Stock shall be deemed to have lapsed immediately before
such Participant's death.
(d) Termination of Employment by Reason of the Disability of a
Participant:
In the event of a Participant's Disability during employment with the
Company or a Subsidiary, the Participant, or his or her guardian or
legal representative shall have a period up to the expiration date
specified in the Agreement within which to exercise the Benefit. In
the case of Restricted Stock, the restrictions on such Restricted
Stock shall be deemed to have lapsed immediately before the
Termination of Employment of such Participant.
17.2. Cancellation of Option Grants and Restricted Stock.
--------------------------------------------------
(a) After Termination of Employment:
If there is a Termination of Employment with respect to a Participant
for any reason other than death, and, pursuant to paragraph (a), (b)
or (d) of Section 17.1, one or more Benefits have not yet expired or
the restrictions pertaining to a Benefit have not lapsed, the
Committee, in its sole discretion, which may be delegated to the
Chief Executive Officer of the Company or to the Chairman of the
Board, may cancel any such Benefits at any time prior to the exercise
thereof or declare forfeited any such Benefits before the related
restrictions lapse unless the following conditions are met:
(i) The Participant shall not render services for any organization
or engage directly or indirectly in any business which, in the
judgment of the Chief Executive Officer of the Company, is or
becomes competitive with the Company, or which is or becomes
otherwise prejudicial to or in conflict with the interests of
the Company. The judgment of the Chief Executive Officer shall
be based on the Participant's positions and responsibilities
while employed by the Company, the Participant's post-employment
responsibili ties and position with the other organization or
business, the extent of past, current and potential competition
or conflict between the Company and the other organization or
business, the effect on the Company's customers, suppliers and
competitors of the Participant's assuming the post-employment
position, and such other considerations as are deemed relevant
given the applicable facts and circumstances. The Participant
shall be free, however, to purchase as an investment or
otherwise, stock or other securities of such organization or
business so long as such stock or securities are listed upon a
recognized securities exchange or traded over-the-counter, and
such investment does not represent a substantial investment to
the Participant or a greater than five percent (5%) equity
interest in the organization or business.
14
<PAGE>
(ii) The Participant shall not, without prior written authorization
from the Company, disclose to anyone outside the Company, or use
in other than the Company's business, any confidential
information or material relating to the business of the Company,
acquired by the Participant either prior to or after such
Participant's Termination of Employment.
(b) Before Termination of Employment:
The Committee, in its sole discretion, which may be delegated to the
Chief Executive Officer of the Company or to the Chairman of the
Board, may cancel any Benefits held by a person or reduce the number
thereof at any time prior to the exercise thereof or declare
forfeited a part or all of any Benefits granted to a Participant
under the following circumstances:
(i) The Participant's conduct either in connection with his or her
employment by the Company or otherwise is deemed inimical to the
interests of the Company.
(ii) The Participant's employment responsibilities with the Company
are reduced or altered and the Committee determines that the
Participant would not have been granted the Benefits, or such
amount of Benefits, had the Participant's employment
responsibilities been at the reduced or altered level at the
time of the grant of such Benefits.
17.3 Unfunded Status of the Plan. The Plan is intended to constitute an
---------------------------
"unfunded" plan for incentive and deferred compensation. With respect to
any payments or deliveries of Shares not yet made to a Participant by the
Company, nothing contained herein shall give any rights that are greater
than those of a general creditor of the Company. The Committee may
authorize the creation of trusts or other arrangements to meet the
obligations created under the Plan to deliver Shares or payments hereunder
consistent with the foregoing.
17.4 Designation of Beneficiary. A Participant may file with the Committee a
--------------------------
written designation of a beneficiary or beneficiaries (subject to such
limitations as to the classes and number of beneficiaries and contingent
beneficiaries as the Committee may from time to time prescribe) to
exercise, in the event of the death of the Participant, an Option, or to
receive, in such event, any Benefits. The Committee reserves the right to
review and approve beneficiary designations. A Participant may from time
to time revoke or change any such designation of beneficiary and any
designation of beneficiary under the Plan shall be controlling over any
other disposition, testamentary or otherwise; provided, however, that if
the Committee shall be in doubt as to the right of any such beneficiary to
exercise any Option or to receive any Benefit, the Committee may determine
to recognize only an exercise by the legal representative of the recipient,
in which case the Company, the Committee and the members thereof shall not
be under any further liability to anyone.
15
<PAGE>
17.5 Nontransferability and Limited Exception.
----------------------------------------
(a) Unless otherwise expressly provided in this Section 17.5, by
applicable law or by any Agreement, as the same may be amended,
evidencing the grant of a Benefit: Benefits are non-transferable and
shall not be subject in any manner to sale, transfer, anticipation,
alienation, assignment, pledge, encumbrance or charge; Benefits shall
be exercised only by the Participant to whom such Benefits were
granted (a "Recipient"); and amounts payable or shares issuable
pursuant to Benefits shall be delivered only to or for the account of
a Recipient.
(b) Except as precluded by any applicable law, the Committee may permit
Benefits to be transferred to and exercised by and paid to certain
persons or entities related to the Recipient including, but not
limited to, members of the Recipient's immediate family (parents,
grandparents, children, grandchildren, spouse, siblings), charitable
institutions, or trusts or other entities whose beneficiaries or
beneficial owners are members of the Recipient's immediate family
and/or charitable institutions, or to such other persons or entities
as may be approved by the Committee, pursuant to such conditions and
procedures as the Committee may establish. Any permitted transfer
shall be subject to such conditions as the Committee may impose
including, but not limited to, the conditions that the Committee
receive evidence satisfactory to it that (i) the transfer is being
made for estate and/or tax planning purposes on a gratuitous or
donative basis and without consideration other than nominal
consideration; and (ii) the transferee and the Recipient disclaim any
claim against or liability of the Company or the Committee in the
event of any cancellation, forfeiture, or reduction in a Benefit after
its transfer to such transferee.
(c) The exercise and transfer restrictions in this Section 17.5 shall not
apply to:
(i) transfers to the Company;
(ii) the designation of a beneficiary to receive Benefits in the
event of the Recipient's death or, if the Recipient has died,
transfers to or exercise by the Recipient's beneficiary, or, in
the absence of a validly designated beneficiary, transfers by
will or the laws of descent and distribution;
(iii) transfers pursuant to a domestic relations order;
(iv) if the Recipient has suffered a Disability, permitted transfers
or exercises on behalf of the Recipient by his or her legal
representative; or
(v) the authorization by the Committee of "cashless exercise"
procedures with third parties who provide financing for the
purpose of (or who otherwise facilitate) the exercise of
Benefits consistent with applicable laws and the express
authorization of the Committee.
16
<PAGE>
(d) In the event of a transfer of a Benefit pursuant to Subsection (b) or
(c) of this Section 17.5, the Recipient will remain liable for any
taxes (including withholding and social security taxes) due upon or
as a consequence of the exercise of or lapse of any restrictions in
respect of a Benefit and neither the Company nor the Committee shall
have any obligation to provide notice to a transferee of any event or
information that has, will or could in any way affect an Award or its
exercise.
17.6 Rule 16b-3. With respect to Participants subject to Section 16 of the
----------
Exchange Act, transactions under this Plan are intended to comply with all
applicable provisions of Rule 16b-3 or its successors under the Exchange
Act. To the extent any provision of the Plan or action of the Committee
fails to so comply, it shall be deemed null and void, to the extent
permitted by law and deemed advisable by the Committee.
17.7 Furnish Information. Each Participant shall furnish to the Company all
-------------------
information requested by the Company to enable it to comply with any
reporting or other requirement imposed upon the Company by or under any
applicable statute or regulation.
17.8 Remedies. The Company shall be entitled to recover from a Participant
--------
reasonable attorneys' fees incurred in connection with the enforcement of
the terms and provisions of the Plan and any Agreement whether by an
action to enforce specific performance or for damages for its breach or
otherwise.
17.9 Information Confidential. As partial consideration for the granting of
------------------------
each Benefit hereunder, the Participant shall agree with the Company that
he will keep confidential all information and knowledge that he has
relating to the manner and amount of his participation in the Plan;
provided, however, that such information may be disclosed as required by
law and may be given in confidence to the Participant's spouse, tax and
financial advisors, or to a financial institution to the extent that such
information is necessary to secure a loan. In the event any breach of this
promise comes to the attention of the Committee, it shall take into
consideration that breach in determining whether to recommend the grant of
any future Benefit to that Participant, as a factor militating against the
advisability of granting any such future Benefit to that individual.
17.10 No Liability for Good Faith Determinations. Neither the members of
------------------------------------------
the Board of Directors nor any member of the Committee shall be liable for
any act, omission, or determination taken or made in good faith with
respect to the Plan or any Benefit granted under it, and members of the
Board of Directors and the Committee shall be entitled to indemnification
and reimbursement by the Company in respect of any claim, loss, damage, or
expense (including attorneys' fees, the costs of settling any suit,
provided such settlement is approved by independent legal counsel selected
by the Company, and amounts paid in satisfaction of a judgment, except a
judgment based on a finding of bad faith) arising therefrom to the full
extent permitted by law and under any directors and officers liability or
similar insurance coverage that may from time to time be in effect. This
right to indemnification shall be in
17
<PAGE>
addition to, and not a limitation on, any other indemnification rights any
member of the Board of Directors or the Committee may have.
17.11 Execution of Receipts and Releases. Any payment of cash or any issuance
----------------------------------
or transfer of Shares to a Participant, or to his legal representative,
heir, legatee, or distributee, in accordance with the provisions hereof,
shall, to the extent thereof, be in full satisfaction of all claims of
such persons hereunder. The Committee may require any Participant, legal
representative, heir, legatee, or distributee, as a condition precedent to
such payment, to execute a release and receipt therefor in such form as it
shall determine.
17.12 Notices. Whenever any notice is required or permitted hereunder other
-------
than a notice to exercise an SAR or Option, such notice must be in writing
and personally delivered or sent by mail. Any such notice required or
permitted to be delivered hereunder shall be deemed to be delivered on the
date on which it is personally delivered, or, whether actually received or
not, on the third Business Day after it is deposited in the United States
mail, certified or registered, postage prepaid, addressed to the person
who is to receive it at the address which such person has theretofore
specified by written notice delivered in accordance herewith. The Company
or a Participant may change, at any time and from time to time, by written
notice to the other, the address which it or he had previously specified
for receiving notices. Until changed in accordance herewith, the Company
and each Participant shall specify as its and his address for receiving
notices the address set forth in the Agreement pertaining to the shares to
which such notice relates. Any notice to exercise an SAR or Option shall
be valid only when it is in fact received by the Company or the person it
designates in accordance with procedures that the Committee may adopt from
time to time.
17.13 Severability. If any provision of this Plan is held to be illegal or
------------
invalid for any reason, the illegality or invalidity shall not affect the
remaining provisions hereof, but such provision shall be fully severable
and the Plan shall be construed and enforced as if the illegal or invalid
provision had never been included herein. If any of the terms or
provisions of this Plan conflict with the requirements of Rule 16b-3 (as
those terms or provisions are applied to Participants who are subject to
Section 16(b) of the Exchange Act) or Section 422 of the Code (with
respect to ISO's), then those conflicting terms or provisions shall be
deemed inoperative to the extent they so conflict with the requirements of
Rule 16b-3 or Section 422 of the Code unless the Committee has determined
that the Plan should not comply with such requirements. With respect to
ISO's, if this Plan does not contain any provision required to be included
herein under Section 422 of the Code, that provision shall be deemed to be
incorporated herein with the same force and effect as if that provision
had been set out at length herein; provided, further, that, to the extent
any Option that is intended to qualify as an ISO cannot so qualify, that
Option (to that extent) shall be deemed an NQSO for all purposes of the
Plan.
17.14 Underscored References. The underscored references contained in the Plan
----------------------
and in any Agreement are included only for convenience, and they shall not
be construed as a part of the Plan or Agreement or in any respect
affecting or modifying its provisions.
18
<PAGE>
17.15 Number and Gender. The masculine, feminine and neuter, wherever used
-----------------
in the Plan or in any Agreement, shall refer to either the masculine,
feminine or neuter; and, unless the context otherwise requires, the
singular shall include the plural and the plural the singular.
17.16 Governing Law. The place of the administration of the Plan and each
-------------
Agreement shall be in the State of Oklahoma. The Plan and each Agreement
shall be construed and administered in accordance with the laws of the
State of Oklahoma, without giving effect to principles relating to
conflict of laws.
17.17 Purchase for Investment. The Committee may require each person
-----------------------
purchasing or receiving Shares pursuant to a Benefit to represent to and
agree with the Company in writing that such person is acquiring the Shares
for investment and without a view to distribution or resale. The
certificates for such Shares may include any legend which the Committee
deems appropriate to reflect any restrictions on transfer. All
certificates for Shares delivered under the Plan shall be subject to such
stock-transfer orders and other restrictions as the Committee may deem
advisable under all applicable laws, rules and regulations, and the
Committee may cause a legend or legends to be put on any such certificates
to make appropriate references to such restrictions.
17.18 No Employment Contract. Neither the adoption of the Plan nor any
----------------------
Benefit granted hereunder shall confer upon any Employee any right to
continued employment nor shall the Plan or any Benefit interfere in any
way with the right of the Employer to terminate the employment of any of
its Employees at any time.
17.19 No Effect on Other Benefits. The receipt of Benefits under the Plan
---------------------------
shall have no effect on any benefits to which a Participant may be
entitled from the Employer, under another plan or otherwise, to preclude a
Participant from receiving any such benefits.
The undersigned, being the duly elected Secretary of NESCO, Inc., does
hereby certify that the foregoing NESCO, Inc. 2000 Equity Incentive Plan was
approved by the Board of Directors as of April 10, 2000, and by the shareholders
of the Company on May 18, 2000.
/s/ Larry G. Johnson
-------------------------------------
Secretary
19
<PAGE>
NESCO, INC.
12331 E. 60TH STREET, TULSA, OKLAHOMA 74146
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Eddy L. Patterson and Albert A. McCutchan,
and each of them, with power of substitution, as proxies, to vote all shares of
NESCO, Inc. (the "Company") which the undersigned is entitled to vote at the
Annual Meeting of the Shareholders on May 18, 2000, at the company's offices at
12331 E. 60th Street, Tulsa, Oklahoma at 1:00 p.m., or any adjournment thereof,
with all the powers the undersigned would have if personally present as
specified, respecting the following matters described in the accompanying Proxy
Statement and, in their discretion, on matters which come before the Annual
Meeting.
1. To elect the following nominees as directors for a one year term: Eddy L.
Patterson, Albert A. McCutchan, E. R. Foraker, Dallin Bagley, and Robert W.
Sumner.
<TABLE>
<S> <C> <C>
FOR all nominees (except as marked WITHHOLD AUTHORITY to vote (INSTRUCTION: To withhold authority
to the contrary at right) For all nominees to vote for any individual nominee, write
( ) ( ) that nominee's name on the space below.)
2. To ratify the selection of Tullius Taylor Sartain & Sartain as independent auditors for the Company for 1999.
FOR AGAINST ABSTAIN
( ) ( ) ( )
3. To approve the NESCO, Inc. 2000 Equity Incentive Plan.
FOR AGAINST ABSTAIN
( ) ( ) ( )
4. To transact such other business as may properly come before the meeting or any adjournment thereof.
</TABLE>
(CONTINUED AND TO BE SIGNED AND DATED ON THE REVERSE SIDE.)
This proxy will be voted in accordance with shareholder specifications.
Unless directed to the contrary, this proxy will be voted FOR Items 1, 2, and 3.
Receipt of accompanying Notice of the meeting and Proxy Statement is hereby
acknowledged.
Date:_______________________________, 2000
__________________________________________
(Signature)
__________________________________________
__________________________________________
(Please Print Your Name)
(Please sign name as fully and exactly as it
appears opposite. When signing in a
fiduciary or representative capacity, please
give full title as such. When more than one
owner, each owner should sign. Proxies
executed by a corporation should be signed
in full corporate name by duly authorized
officer.)
PLEASE MARK, SIGN, DATE AND MAIL TO THE COMPANY AT THE ADDRESS STATED ABOVE.
