<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
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 Section240.14a-11(c) or
Section240.14a-12
BALLANTYNE OF OMAHA, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]
NOTICE AND PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AT
THE WESTIN AQUILA HOTEL
1615 HOWARD STREET
OMAHA, NEBRASKA 68102
ON
WEDNESDAY, MAY 27, 1998 AT 4:00 P.M. (CENTRAL TIME)
<PAGE>
BALLANTYNE OF OMAHA, INC.
4350 MCKINLEY ROAD
OMAHA, NEBRASKA 68112
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 27, 1998
The Annual Meeting of Shareholders of Ballantyne of Omaha, Inc. will be held
at The Westin Aquila Hotel, 1615 Howard Street, Omaha, Nebraska 68102, on May
27, 1998 at 4:00 p.m. for the following purposes:
1. To elect, as Directors, two persons listed in the accompanying Proxy
Statement.
2. To approve Amendment No. 1 to the 1995 Stock Option Plan (the "Plan")
increasing the Plan shares by 260,000 shares.
3. To approve Amendment No. 2 to the 1995 Stock Option Plan (the "Plan")
thereby removing the 75,000 share limitation on options that any
Participant in the Plan can receive in any calendar year.
4. To approve an amendment to the 1995 Outside Directors' Stock Option Plan
decreasing the automatic grant to outside directors from 24,750 shares to
15,000 shares.
5. To transact such other business as may properly be brought before the
meeting or any adjournment thereof.
Only those shareholders of record at the close of business on April 10, 1998
shall be entitled to notice of the meeting and to vote at the meeting.
In order to assure a quorum, all shareholders are urged to attend the
meeting or to vote by proxy. In the event you are present at the meeting, you
may withdraw your proxy if you wish to do so, and vote in person.
In order to ensure adequate meeting space, please notify Patricia Coleman at
Ballantyne on or before May 11, 1998 (402) 453-4444, ext. 303, if you are
planning to attend the meeting. Also, for assistance in scheduling overnight
accommodations in Omaha, contact Ms. Coleman. Early reservations are encouraged.
Dated this 17th day of April, 1998.
By Order of the Board of Directors
John Wilmers
President and Chief
Executive Officer
<PAGE>
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Ballantyne of Omaha, Inc. (the "Company")
for use at the Annual Meeting of Shareholders to be held on May 27, 1998.
Shareholders of record at the close of business on April 10, 1998 are entitled
to notice of, and to vote at, the meeting and any adjournment thereof. This
Proxy Statement was first mailed to shareholders on April 17, 1998.
VOTING SHARES AND PRINCIPAL HOLDERS
Based upon the records of the Company, Canrad of Delaware, Inc., 100
Chestnut Street, Newark, New Jersey 07105, owns 2,056,411 shares, or 22.7% of
the Company's outstanding Common Stock as of March 31, 1998. Canrad of Delaware,
Inc. is a wholly-owned subsidiary of Canrad Inc. which is an indirect,
wholly-owned subsidiary of ARC International Corporation ("ARC").
APPOINTMENT AND REVOCATION OF PROXIES
As of the close of business on March 31, 1998, the Company had 9,040,896
shares of outstanding Common Stock, all of which are entitled to vote at the
Annual Meeting.
Each share is entitled to one vote on each matter presented.
Proxies which are properly signed and returned will be voted at the meeting.
Shareholders may specify their preference by marking the appropriate boxes on
the proxy and the proxy will then be voted in accordance with such
specifications. In the absence of such specifications, the proxy will be voted
for the election of the two nominees for Directors and in accordance with the
instructions of the Board of Directors as to any other matters. Shareholders who
attend the meeting may vote in person even though they have voted by proxy. A
proxy is revocable at any time before it is voted and a proxy is automatically
revoked upon the giving of a subsequent proxy or by voting in person at the
meeting. The Company will bear the cost of solicitation of proxies, including
the charges and expenses of brokers and others for forwarding solicitation
materials to beneficial owners of stock. In addition to the use of mail, proxies
may be solicited by personal interview, telephone or facsimile.
PROPOSAL 1
ELECTION OF DIRECTORS
The Bylaws of the Company provide that the number of Directors shall be
fixed from time to time exclusively by the Board of Directors pursuant to a
resolution adopted by a majority of the Board. The Board of Directors has set
such number at seven for 1998.
The Bylaws also provide that the Directors shall be divided into three
classes. The members of each class serve staggered three-year terms. Messrs.
Tenney and Geller are Class I Directors; Messrs. Echtenkamp, Chelin and Richards
are Class II Directors; and Messrs. Wilmers and Campbell are Class III
Directors. The terms of the Class III, Class I and Class II Directors expire at
the Annual Meeting of Shareholders to be held in 1998, 1999, and 2000,
respectively. The Board of Directors has nominated Mr. John Wilmers and Mr.
Colin Campbell for election as Directors to serve until the Annual Meeting of
Shareholders in the year 2001.
The proxy holders named in the proxy intend to vote "FOR" the election of
the two nominees listed below unless authority to so vote is withheld. In the
unexpected event that any one or both of the nominees are unable to serve or for
good cause will not serve as Directors, the proxy holders reserve the right to
vote for such substitute nominees as are designated by the Board of Directors.
Following is a list of the names and ages of the two nominees, both of whom
are presently serving as Directors. Also listed are the two Directors whose
terms expire in 1999 and the three Directors whose terms expire in 2000.
Included is the past five-year business history of each Director and
1
<PAGE>
nominee and any public company directorships held by such persons, the year in
which each became a Director of the Company and the number and the percentage of
outstanding shares of Common Stock of the Company beneficially owned by each as
of March 31, 1998.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 1, THE ELECTION OF
MESSRS. WILMERS AND CAMPBELL.
<TABLE>
<CAPTION>
DIRECTOR NO. OF
NAME AGE EMPLOYMENT HISTORY SINCE SHARES
- ---------------------------- --- ------------------------------------------------------ --------- ------------
<S> <C> <C> <C> <C>
CLASS I: TERM EXPIRES IN 1999
Arnold S. Tenney 55 Chairman of Board since 1992; President and CEO of ARC 1988 175,975(2)
since 1978; Chairman of Board and Director of Cabletel
Communications Corp.; Director of ARC.
Marshall S. Geller 58 Chairman and CEO of Geller and Friend Capital 1996 28,590(3)
Partners, Inc., a merchant banking firm, since 1995;
Managing Partner Golenberg & Geller, Inc. from
1991-1993; currently serving as Director of Hexcel
Corp.; Players International, Inc.; iMALL, Inc;
Cabletel Corp.; Datalink Corp; Lone Wolf
International; and Value Vision International, Inc.
CLASS II: TERM EXPIRES IN 2000
Ronald H. Echtenkamp 64 Vice Chairman of the Board since March 1997; prior 1993 66,673(4)
President of Company 1981-1997, and CEO of Company
1991-1997; joined the Company in 1969 and served in
various capacities since.
Yale Richards 75 Senior partner in the law firm of Marks, Clare & 1995 19,250(5)
Richards; has privately practiced law since 1947.
Jeffrey D. Chelin 46 Vice President-Finance and Chief Financial Officer of 1995 22,750(6)
ARC since 1992; prior to 1992 was Controller and
Assistant Secretary of ARC.
CLASS III: NOMINEES FOR ELECTION
John P. Wilmers 53 President and CEO of the Company since March 1997; 1995 122,312(7)
previously Executive Vice President of the Company
since 1992; joined the Company in 1981 and served in
various capacities since.
Colin G. Campbell 42 Self-employed providing financial and consulting 1995 12,750(8)
services through The Castlestone Company since 1993;
prior to 1993 Mr. Campbell provided services through
The Highbridge Group.
All Executive Officers own 314,563 shares, including presently exercisable stock options, or 3.48% of the outstanding
Common Stock.(1)(9) All Directors and Executive Officers as a group (9 persons) own 573,878 shares, including presently
exercisable stock options, or 6.35% of the outstanding Common Stock.(1)(10)
<CAPTION>
NAME %(1)
- ---------------------------- ---------
<S> <C>
Arnold S. Tenney 1.95%
Marshall S. Geller .32%
Ronald H. Echtenkamp .74%
Yale Richards .21%
Jeffrey D. Chelin .25%
John P. Wilmers 1.35%
Colin G. Campbell .14%
All Executive Officers own 3
Common Stock.(1)(9) All Dire
exercisable stock options, o
</TABLE>
2
<PAGE>
- ------------------------
(1) Based upon 9,040,896 shares of Common Stock outstanding as of March 31,
1998. Each named person is deemed to be the beneficial owner of shares of
Common Stock that may be acquired within 60 days upon exercise of stock
options. Accordingly, the number of shares and percentage set forth next to
the name of such person and all directors as a group include the shares of
Common Stock issuable upon presently exercisable stock options. However,
the shares of Common Stock so issuable upon such exercise by any such
person are not included in calculating the percentage of Common Stock
beneficially owned by any other stockholder.
(2) Includes 30,000 shares of Common Stock held indirectly by Mr. Tenney
through Arnmart Investments Limited, a corporation controlled by Mr. Tenney
and members of his family, 16,500 shares of Common Stock owned directly by
Mr. Tenney, 2,475 shares owned indirectly by Mr. Tenney through his wife
and 127,000 shares purchasable pursuant to presently exercisable stock
options. Does not include 2,056,411 shares owned beneficially by ARC. In
addition, does not include 25,000 stock options granted to Mr. Tenney which
will vest if Proposal 3 is approved by the holders of a majority of the
Common Stock. See ADDITIONAL INFORMATION CONCERNING BOARD OF DIRECTORS --
Compensation of Directors.
(3) Includes 15,840 shares of Common Stock held directly by Mr. Geller, and
12,750 shares purchasable pursuant to presently exercisable stock options.
(4) Includes 46,673 shares of Common Stock owned directly by Mr. Echtenkamp and
20,000 shares purchasable pursuant to presently exercisable stock options.
(5) Includes 1,000 shares owned directly by Mr. Richards and 18,250 shares
purchasable pursuant to presently exercisable stock options.
(6) Includes 22,750 shares of Common Stock purchasable pursuant to presently
exercisable stock options.
(7) Includes 7,312 shares of Common Stock owned directly by Mr. Wilmers and
115,000 shares purchasable pursuant to presently exercisable stock options.
(8) Includes 12,750 shares of Common Stock purchasable pursuant to presently
exercisable stock options.
(9) Includes 73,563 shares of Common Stock owned by all executive officers and
241,000 shares purchasable pursuant to presently exercisable stock options.
(10) Includes 139,378 shares of Common Stock owned by all directors and
executive officers as a group and 434,500 shares purchasable pursuant to
presently exercisable stock options.
ADDITIONAL INFORMATION CONCERNING BOARD OF DIRECTORS
AUDIT COMMITTEE
The Company has an Audit Committee whose members include Messrs. Campbell,
Echtenkamp and Richards. The Audit Committee is responsible for recommending to
the Board of Directors the engagement of the independent auditors of the Company
and reviewing with the independent auditors the scope and results of the audits,
the internal accounting controls of the Company, audit practices and the
professional services furnished by the independent auditors. The Audit Committee
met to discuss issues relating to fiscal 1997 on January 27, 1998.
COMPENSATION COMMITTEE
The Company has a Compensation Committee whose members include Messrs.
Tenney, Echtenkamp, Campbell and Richards. The Compensation Committee is
responsible for reviewing all compensation agreements and arrangements for
officers of the Company other than options granted under the 1995 Stock Option
Plan. The Compensation Committee met to discuss issues relating to fiscal 1997
and salary increases for 1998 on January 27, 1998.
3
<PAGE>
COMPENSATION OF DIRECTORS
Directors who are employees of ARC, Canrad Inc. or the Company were not
compensated for serving as directors in 1997. Outside directors were paid $600
for attendance at meetings of the Board. They received $300 for all meetings of
the Board held by teleconference. Directors of the Company will be reimbursed
for out-of-pocket expenses. Outside directors also participate in the Outside
Directors Stock Option Plan, pursuant to which a total of 165,000 shares of
Common Stock is allocated. Subject to a one-time election to decline
participation, outside directors are granted an option to purchase 24,750 shares
of Common Stock on the first business day following their election or
appointment to the Board of Directors. The option vests at the rate of 8,250
shares on the first business day following a director's initial election or
appointment to the Board, and 8,250 shares on the first business day after each
annual meeting of shareholders, so long as the director continues to be a member
of the Board of Directors. An additional amount of options is granted
automatically to participating outside directors on the next succeeding business
day after the third consecutive annual meeting of shareholders following the
initial grant, and on the next succeeding business day after every third annual
meeting of shareholders thereafter during the term of the plan, so long as the
director continues to be a member of the Board of Directors. The options are
granted at the fair market value of the Common Stock on the date of grant and
have a term of five years. Pursuant to a proposed amendment to the Outside
Directors Stock Option Plan, described in Proposal 3 below, outside directors
will, subject to a one-time election, be granted an option to purchase 15,000
shares of Common Stock (as opposed to 24,750 shares currently) on the next
succeeding business day after their initial election to the Board, and on the
next succeeding business day after the third consecutive annual meeting of
shareholders. The option to purchase 15,000 shares would vest at the rate of
5,000 shares on the first business day after each annual meeting of
shareholders.
Beginning January 1, 1998, outside directors will receive $15,000 per year,
payable quarterly, for service on the Board. Outside directors will be paid
$1,000 for attendance at meetings and $500 for each meeting held by telephone
conference in 1998.
On January 27, 1998, the Board of Directors recommended and the Stock Option
Committee approved, stock option grants under the 1995 Stock Option Plan of
100,000 stock options to Arnold Tenney and 10,000 stock options to Jeffrey
Chelin, both of whom are employed by ARC, and a stock option grant of 20,000
options to Ronald Echtenkamp, who is currently consulting for the Company. Such
options were granted in consideration of extraordinary services performed on
behalf of the Company and as an inducement for the optionees to continue such
performance in the future. The grant of 100,000 stock options to Mr. Tenney is
subject to approval by the shareholders of Amendment No. 2 to the 1995 Stock
Option Plan set forth in Proposal 3 below, which would remove the 75,000 share
limitation on options that any Participant in the Plan can receive in any
calendar year. Absent approval of said amendment, Mr. Tenney will only receive
75,000 stock options.
The Board of Directors held seven meetings in 1997. Mr. Geller was not
present for two of the seven meetings and therefore, attended fewer than 75% of
the aggregate of the total number of meetings of the Board of Directors.
4
<PAGE>
LIST OF CURRENT EXECUTIVE OFFICERS OF THE COMPANY
The following is a list of the names and ages of the current executive
officers of the Company, their business history for the last five years and
their term of office with the Company.
<TABLE>
<CAPTION>
OFFICER
NAME(1) AGE POSITION AND PRINCIPAL OCCUPATION SINCE 1992 SINCE
- ------------------- --- ------------------------------------------------------------------------------ ---------
<S> <C> <C> <C>
John P. Wilmers 53 Director of Company; President and CEO of Company since March 1997; previously 1988
Executive Vice President of Sales since 1992; Joined Company in 1981 and has
served in various capacities since.
Brad J. French 45 CFO since 1996; Secretary and Treasurer of the Company since 1992; joined 1992
Company as Controller in 1990.
Ray F. Boegner 48 Senior Vice President of Sales since November 1996; previously Vice President 1997
of Sales since 1992.
</TABLE>
- ------------------------
(1) Mr. Echtenkamp served as President and CEO of the Company from 1981 through
February 1997.
EXECUTIVE COMPENSATION
The following table sets forth a summary of the compensation paid to the
Chief Executive Officer and three other executive officers of the Company whose
total compensation exceeded $100,000 for the fiscal years ended December 31,
1997, 1996, and 1995. The information in this table does not include stock
options granted in 1998 to Mr. Echtenkamp which options are disclosed elsewhere
in this proxy statement.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------
AWARDS
ANNUAL COMPENSATION ------------------------- PAYOUTS
---------------------------------- RESTRICTED SECURITIES -------
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND BONUS COMPENSATION AWARD(S) OPTIONS/SARS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR SALARY ($) ($) ($) ($) (#)(7) ($) ($)
(A) (B) (C) (D) (E) (F) (G) (H) (I)
- ------------------------------ ---- ---------- ------- ------------ ---------- ------------ ------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John P. Wilmers, 1997 169,950 454,000 115,000
President and Chief 1996 152,269 215,000 66,000
Executive Officer(1)(5) 1995 139,050 100,786 66,000
Brad J. French, 1997 95,275 120,000 49,000
Secretary and Treasurer, 1996 88,065 60,000 33,000
Chief Financial Officer(1) 1995 81,370 40,000 33,000
Ray F. Boegner, 1997 108,029 140,000 57,000
Senior Vice President of 1996 95,275 80,000 33,000
Sales, since 1996(1)(6) 1995 88,065 50,000 33,000
Ronald H. 1997 110,366 61,000 1,663,238(3) --
Echtenkamp(1)(2)(3)(4) 1996 178,500(2) 320,676 123,750
1995 202,500(2) 215,000 123,750
</TABLE>
- ------------------------
(1) Salary includes $4,950 (1997), $4,269 (1996) and $4,050 (1995) for Mr.
Wilmers; $2,775 (1997), $2,565 (1996) and $2,370 (1995) for Mr. French;
$3,029 (1997), $2,775 (1996) and $2,565 (1995) for Mr. Boegner; and $1,904
(1997), $4,500 (1996) and $4,500 (1995) for Mr. Echtenkamp paid by the
Company pursuant to the Retirement and Savings Plan described below.
(2) Salary includes $24,000 for 1996 and $48,000 for 1995 which was deferred
pursuant to Mr. Echtenkamp's employment contract then in effect.
5
<PAGE>
(3) Mr. Echtenkamp received $1,663,238 in 1997 from the exercise and subsequent
resale of certain stock options. The dollar amount reported is the
difference between the exercise price of the option and the subsequent
resale price of the shares. A portion of this amount was treated as ordinary
income and a portion was treated as short-term capital gain. See footnotes
(4), (5) and (6) attached.
(4) Mr. Echtenkamp served as President and Chief Executive Officer of the
Company during the fiscal years ended December 31, 1995 and 1996. Mr.
Echtenkamp continued to serve as President and Chief Executive Officer of
the Company until his resignation on February 28, 1997. In connection with
his resignation, Mr. Echtenkamp was elected to the office of Vice Chairman
of the Board and remains as a part-time consultant of the Company.
(5) Mr. Wilmers served as Executive Vice President of Sales of the Company
during the fiscal years ended December 31, 1995 and 1996. Mr. Wilmers
continued to serve as Executive Vice President of Sales of the Company until
February 28, 1997. On March 1, 1997, Mr. Wilmers was elected President and
Chief Executive Officer of the Company.
(6) Mr. Boegner served as Vice President of Sales of the Company during the
fiscal years ended December 31, 1995 and from January 1, 1996 until November
19, 1996. On November 20, 1996, Mr. Boegner became Senior Vice President of
Sales for the Company. On May 22, 1997, Mr. Boegner was elected an executive
officer of the Company.
(7) Adjusted for 10% stock distribution effected March 8, 1996 and 3-for-2 stock
split effected as a 50% stock dividend on March 5, 1997.
The following table sets forth information with respect to exercised and
unexercised options and SARs, if any, during fiscal year 1997. This table does
not include options granted in 1998 to Mr. Echtenkamp, which options are
disclosed elsewhere in the proxy statement.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FISCAL YEAR END (#) FISCAL 1996 YEAR END
SHARES ------------------- ($)
ACQUIRED ON EXERCISABLE ("EX") ---------------------
EXERCISE VALUE REALIZED UNEXERCISABLE EXERCISABLE ("EX")
NAME (#) ($) ("UN") UNEXERCISABLE ("UN")
(A) (B) (C) (D) (E)
- ---------------------------- ----------- --------------- ------------------- ---------------------
<S> <C> <C> <C> <C>
John P. Wilmers 0 0 115,000("Ex")(2) $ 998,000("Ex")
Brad J. French 4,500 $ 63,270(1) 49,000("Ex")(2) $ 455,835("Ex")
Ray F. Boegner 0 0 57,000("Ex")(2) $ 499,000("Ex")
Ronald H. Echtenkamp 25,000 $ 81,250(3) 0("Ex") 0("Ex")
123,750 $ 1,997,163(4) 0("Ex") 0("Ex")
</TABLE>
- ------------------------
(1) Mr. French acquired 4,500 shares upon exercise of stock options. The value
realized is based on the difference between the exercise price and the fair
market value as of December 31, 1997.
(2) Adjusted for 10% stock distribution effected March 8, 1996 and 3-for-2 stock
split effected as a 50% stock dividend on March 5, 1997.
(3) Mr. Echtenkamp exercised an option to purchase 25,000 shares of ARC at $3.00
per share. The value realized is based on the difference between the
exercise price and the fair market value of the ARC shares as of December
31, 1997.
(4) Mr. Echtenkamp exercised 123,750 options in 1997 and resold 100,000 shares
for a net gain of $1,663,238. The value realized on the remaining 23,750
shares is $333,952 and is based on the difference between the exercise price
and the fair market value as of December 31, 1997.
6
<PAGE>
The following table sets forth information with respect to options granted
in 1997 to the executive officers of the Company pursuant to the Company's 1995
Stock Option Plan. This table does not include options granted in 1998 to Mr.
Echtenkamp, which options are disclosed elsewhere in this proxy statement.
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
- -----------------------------------------------------------------------------------------
PERCENT OF VALUE AT ASSUMED
NUMBER OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS/SARS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OR OPTION TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION ----------------------
NAME GRANTED (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
(A) (B) (C) (D) (E) (F) (G)
- ------------------------------- ------------- --------------- ------------ ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
John P. Wilmers 34,000 26.9% 15.94 04-02-07 25.98 41.34
15,000 11.9% 18.00 10-14-07 29.33 46.71
Brad J. French 10,500(1) 8.3% 12.75(1) 01-27-07 20.77 33.08
10,000 7.9% 18.00 10-14-07 29.33 46.71
Ray F. Boegner 17,000 13.4% 15.94 04-02-07 25.98 41.34
7,000 5.5% 18.00 10-14-07 29.33 46.71
</TABLE>
- ------------------------
(1) Adjusted for 3-for-2 stock split effected as 50% dividend on March 5, 1997.
EMPLOYMENT CONTRACTS
Mr. Echtenkamp's employment contract expired on March 31, 1997. On February
28, 1997, he stepped down from the office of President of the Company and
terminated his full time employment with the Company on April 30, 1997. Mr.
Echtenkamp was elected Vice Chairman of the Board and remains a part-time
consultant with the Company, with the primary responsibility of pursuing and
negotiating acquisitions of other businesses.
Mr. Wilmers was elected President of the Company and Chief Executive
Officer, effective March 1, 1997. The Compensation Committee and the Board of
Directors approved a five year contract for Mr. Wilmers commencing January 1,
1997, at an initial compensation of $165,000 per year, plus participation in the
key employees' profit sharing plan and other normal employee benefits.
Mr. Boegner was elected Senior Vice President of Sales in November 1996 and
is a party to a five year employment agreement dated November 20, 1996 at an
initial compensation rate of $92,500 per year, plus participation in the key
employees' profit sharing plan and normal employee benefits. Effective January
1, 1997 Mr. Boegner's compensation was increased to $105,000 per year. On May
22, 1997, Mr. Boegner was elected an executive officer of the Company.
PROFIT SHARING PLAN
During 1997 Messrs. Wilmers, Echtenkamp, French and Boegner participated in
the Profit Sharing Plan pursuant to which such employees are entitled to earn
cash bonuses if the Company achieves specific operating levels that are
established by the Board. The calculation of the annual bonus pool is subject to
the approval of the Compensation Committee of the Board. The distribution of the
pool among members of management is determined by Mr. Wilmers subject to
approval by the Compensation Committee. The Chief Executive Officer, currently
Mr. Wilmers, is entitled to receive no more than 40% of the pool. Amounts paid
to Messrs. Echtenkamp, Wilmers, French and Boegner pursuant to the Profit
Sharing Plan are included in the Summary Compensation Table.
7
<PAGE>
RETIREMENT AND SAVINGS PLAN
The Company has adopted a Retirement and Savings Plan (the "Plan"), which is
a combination savings and profit sharing plan designed to qualify under Section
401 of the United States Internal Revenue Code of 1986, as amended (the "Code"),
including the provisions of Section 401(k). All full-time employees of
Ballantyne who are at least twenty-one years old and who have completed one year
of service are eligible to participate in the Plan.
Each Participant may contribute an amount up to six percent (6%) of such
Participant's salary to the matching portion of the Plan, and such Participant
may make supplemental contributions up to an additional nine percent (9%) of
such Participant's salary. These supplemental contributions are not eligible for
matching contributions from the Company. Ballantyne's matching contribution is
$.50 for each dollar contributed by the Participant to the matching portion of
the Plan. In addition, the Company may elect, in the discretion of the Board, to
contribute an additional amount. All contributions to the Plan are
nonforfeitable. For 1997, no Participant could contribute more than $9,500 to
the Plan.
Benefits may be distributed to Participants or their beneficiaries, as the
case may be, in the event of a Participant's death, retirement or other
termination of service, or, if the Participant so requests, on reaching age
59 1/2. Participants may be eligible to withdraw benefits in case of hardship.
Contributions to the Plan made by the Company on behalf of Messrs.
Echtenkamp, Wilmers, French and Boegner are included in the Summary Compensation
Table.
8
<PAGE>
REPORT ON EXECUTIVE COMPENSATION
RESPONSIBILITY; COMPOSITION OF COMMITTEES
The Company has a Compensation Committee which is responsible for reviewing
and recommending to the Board of Directors of the Company annually the
compensation to be paid to the executive officers of the Company. The
Compensation Committee is comprised of four members of the Board of Directors,
Messrs. Tenney, Echtenkamp, Campbell and Richards.
Mr. Wilmers, in his capacity as President and Chief Executive Officer of the
Company, will determine the compensation to be paid to Mr. French and Mr.
Boegner, subject to review by the Compensation Committee.
The Company also has an independent committee, the 1995 Stock Option
Committee, which is responsible for the granting of options under the 1995 Stock
Option Plan of the Company to executive officers, directors and key employees of
the Company. The Stock Option Committee is comprised of Messrs. Campbell and
Richards.
COMPENSATION PHILOSOPHY
Decisions with respect to executive compensation are made by the
Compensation Committee on an individual basis based upon a number of factors,
including the provisions of any existing employment contract with an executive
officer, evaluation of the executive officer's performance, the level of
responsibility associated with the executive officer's office, recruitment
requirements and the performance of the Company. Compensation of the executive
officers of the Company has historically been structured to motivate, reward and
retain the executive officers consistent with the needs of the Company from time
to time. The major elements of the executive officers' compensation are base
salary, short-term incentive in the form of a bonus payable from the Profit
Sharing Plan and a long-term incentive in the form of options to purchase Common
Stock, with an emphasis on annual bonuses and options.
BASE SALARY
The base salaries of executive officers have historically reflected, and
will continue to reflect their individual contribution. Mr. Wilmers has an
employment contract commencing January 1, 1997, at an initial compensation of
$165,000 per year plus participation in the key employees' profit sharing plan
and other normal benefits. The base salary of Mr. French, which is not subject
to an employment agreement, was increased in 1997 from $85,500 per year to
$92,500 per year. The base salary of Mr. Boegner, which is subject to an
employment agreement, was increased in January 1997 from $92,500 to $105,000.
CASH BONUSES
The executive officers participate in a management and sales bonus plan
designated as the Profit Sharing Plan pursuant to which they receive cash
bonuses if the Company achieves specific operating levels. The Profit Sharing
Pool is based upon a percentage of operating income, as defined by the Board of
Directors. The calculation of the Profit Sharing Plan Pool will be subject to
approval of the Compensation Committee. The distribution among management is at
the initial determination of Mr. Wilmers but is also subject to approval by the
Compensation Committee. Mr. Wilmers may receive no more than 40% of the pool.
Participant bonuses will continue to be based upon individual performance during
the prior year.
STOCK OPTIONS
The 1995 Stock Option Plan (the "Stock Option Plan") of the Company is
designed to give employees, officers and directors of the Company the incentive
to maximize wealth for shareholders by participating in the long-term growth of
the Company. In 1997, the Stock Option Committee
9
<PAGE>
granted employees, officers and directors a total of 126,500 stock options with
exercise prices ranging from $12.75 to $18.00. Options granted to Messrs.
Wilmers, French and Boegner are included in the Aggregated Option/SAR Exercise
chart herein.
As to future options, the Stock Option Committee will consider the number
and terms of the options outstanding when determining to grant options. The
Stock Option Plan currently provides that no member of the Stock Option
Committee can participate in the Stock Option Plan during his membership on the
Stock Option Committee. According to the provisions of the Stock Option Plan,
the Stock Option Committee determines, among other things, the number of shares
of common stock to be optioned, the option price and the term of the option.
The Company's general policy is to grant options at the fair market value of
the common stock on the date of grant with terms of generally ten years in
length. In no event will options be granted at less than 85% of fair market
value of the common stock on the date of grant.
CHIEF EXECUTIVE OFFICER COMPENSATION
As stated earlier, the base annual compensation of Mr. Wilmers is set
pursuant to his employment agreement at an initial compensation of $165,000 per
year, plus participation in the key employees' profit sharing plan and other
normal employee benefits.
The foregoing report is submitted by the Compensation and Stock Option
Committees of the Board of Directors of the Company in accordance with
requirements of the Securities Exchange Act of 1934 and the rules and
regulations thereunder and is not intended to create any contractually binding
employment rights for the benefit of any employee of the Company.
<TABLE>
<S> <C>
COMPENSATION COMMITTEE: STOCK OPTION COMMITTEE:
Arnold S. Tenney Colin G. Campbell
Colin G. Campbell Yale Richards
Ronald H. Echtenkamp
Yale Richards
</TABLE>
10
<PAGE>
PERFORMANCE GRAPH
The following performance graph shows the cumulative total return on the
Common Stock, the S & P 500 Market Value Index and a peer group for the period
September 7, 1995 (the date upon which the Company's common stock became
publicly traded) through December 31, 1997. The peer group is made up of five
corporations (namely Concord Camera Corp., Accom, Inc., Showscan Entertainment,
Inc., Videonics, Inc. and Sonic Solutions, Inc.). The peer group is comprised of
companies with a market capitalization between approximately $30 million and $50
million, each of which is engaged in the sale of products related to the
theater, motion picture or image capturing or image projection businesses. The
Company is unable to identify for comparison purposes any public industry or
line-of-business indices because the small number of companies offering similar
or competing products are divisions or subsidiaries of much larger, diversified
companies.
The performance graph assumes the value of the investment in the Common
Stock and each index was $100 and that all dividends were reinvested.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
BALLANTYNE OF OMAHA, INC. PEER GROUP S&P 500
<S> <C> <C> <C>
09/07/95 100.00 100.00 100.00
12/29/95 111.21 71.99 108.82
12/31/96 301.38 58.31 133.78
12/31/97 409.42 68.52 178.41
</TABLE>
11
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
MANAGEMENT AGREEMENT
The Company is a party to a management agreement (the "Management
Agreement") with Canrad Inc. dated September 12, 1995. Pursuant to the terms of
the Management Agreement, Canrad Inc. provides services to the Company relating
to overall management and strategic planning and direction, banking
negotiations, treasury functions, investor relations, securities regulatory
compliance, employee and general business insurance programs and asset
acquisitions and sales. Pursuant to the Management Agreement, Canrad Inc. makes
available to the Company the services of Arnold S. Tenney, the Chairman of the
Board of Canrad Inc. Mr. Tenney acts as the Chairman of the Board of the
Company. Mr. Tenney shares primary responsibility with the Company's Chief
Executive Officer with respect to overall management and strategic planning and
direction, the identification, analysis and consummation of acquisitions, and
investor relations. As compensation for its services, the Management Agreement
provides that Canrad Inc. receives a monthly fee of $25,000 and is entitled to
reimbursement for its identifiable reasonable out-of-pocket expenses incurred in
connection with the performance of services under the Management Agreement. The
Management Agreement provides for an initial term of five years and thereafter
is automatically renewed for successive one-year periods until terminated by
either party upon 90 days' prior notice. The Management Agreement was amended on
July 1, 1997 to provide a decrease in the fee to be received by Canrad Inc. from
$25,000 per month to $12,500 per month. In 1997, the Company paid $225,000 in
management fees to Canrad Inc. During the initial term of the Management
Agreement, which expires on September 12, 2000, the payment terms thereof may
not be amended without the consent of the managing underwriters of the Company's
initial public offering.
THE GELLER OPTION
The Company has granted to Geller & Friend and its employees an option to
purchase 82,500 shares of Common Stock at a per share exercise price of $4.39 as
consideration for strategic financial services provided to the Company by Geller
& Friend. Of these 82,500 shares, options totaling 35,786 have been assigned to
employees of Geller & Friend. The option was exercised in full in fiscal 1997.
The Company effected an S-3 Registration Statement on March 6, 1997 permitting
the resale of these shares. Marshall Geller, a director of the Company, is
Chairman and Chief Executive Officer of Geller & Friend.
INSURANCE COVERAGE
The Company is included in group health and business insurance programs
maintained by ARC and Canrad Inc. The group health insurance plan is a
self-insured minimum premium plan that is administered through the Connecticut
General Life Insurance Company. The group health insurance plan provides for
specific stop loss coverage in the amount of $75,000 per employee per plan year
and aggregate stop loss based upon the head count of those covered under the
plan, including the Company's employees and certain ARC retirees. The aggregate
stop loss level for the group health insurance plan for the May 1, 1997 to April
30, 1998 plan year is approximately $1,260,000. The Company is charged premiums
which are a set dollar amount based on its monthly head count for the minimum
premium, stop loss and plan administration portions of the program and its
aggregate salary for long-term disability and term life coverage. The Company is
also charged for its claims incurred pursuant to the program.
The business insurance program provides coverage for workers' compensation
and employers liability, general liability, including products and completed
operations, property, automobile, umbrella and directors and officers liability.
The Company's portion of the business insurance premium is calculated and
charged to operations based upon its allocated share of the coverage provided to
that of the entire Canrad Inc. group. Such allocations are based primarily upon
aggregate payrolls, net sales, asset values and number of automobiles. Most of
the policies require annual audit and adjustment of deposit premiums for
differences between estimated values upon which deposit premiums have been
calculated and actual results. An additional premium is assessed in
circumstances
12
<PAGE>
where actual values exceed estimated values and a premium credit is issued for
instances where the estimated values exceed the actual values.
PAYMENTS TO CANRAD
For 1997, the Company paid approximately $1,329,000 to Canrad representing
the insurance premiums and claims described above and other miscellaneous
services excluding management fees.
OTHER
Yale Richards, a director of the Company, is a senior partner of Marks Clare
& Richards, a law firm which performs legal services for the Company from time
to time.
PROPOSAL 2
AMENDMENT NO. 1 TO 1995 STOCK OPTION PLAN
On March 24, 1998 the Board of Directors of the Company adopted an amendment
("Amendment No. 1") to the Company's 1995 Stock Option Plan (the "Plan") to
increase the number of Shares of common stock that may be issued under the Plan
from 1,060,000 Shares to 1,320,000 Shares, or an increase of 260,000 Shares. As
of March 31, 1998, the Company has issued options of 794,750 Shares under the
Plan in order to provide long term incentive to key directors, officers and
employees. Since the number of Shares available for grant under the Plan is
nearly depleted, the Board of Directors deems it to be in the best interest of
the Company to increase the amount of Shares available by 260,000 Shares.
If this proposed Amendment No. 1 is adopted, the amended portion of the
first sentence in the second paragraph of Section 6 of the Plan will read as
follows:
"The maximum aggregate number of Shares that may be issued under
the Plan is 1,320,000 Shares; . . ."
No other provisions of the Plan will be changed or altered by this Amendment
No. 1. Options may continue to be granted under the Plan through September,
2005. Options granted under the Plan may either be incentive stock options or
non-qualified stock options.
This Amendment No. 1 will not become effective unless approved by the
holders of a majority of the outstanding Common Stock of the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF PROPOSAL 2 TO
AMEND THE PLAN.
PROPOSAL 3
AMENDMENT NO. 2 TO 1995 STOCK OPTION PLAN
On April 8, 1998 the Board of Directors of the Company adopted an amendment
("Amendment No. 2") to the Company's 1995 Stock Option Plan (the "Plan") to
remove the limitation of 75,000 options which may be received by any Participant
in the Plan in any calendar year, retroactive to January 1, 1998. If Amendment
No. 2 is approved by the holders of the majority of the outstanding Common Stock
of the Company, there will no longer be a restriction on the number of options
which can be granted to any Participant in the Plan in any calendar year, except
the limit on the aggregate number of shares issuable pursuant to the Plan. The
Board of Directors reasoned that it may be important to the future business and
potential business acquisitions of the Company to grant a greater number of
options to retain current employees of the Company, or current employees of
businesses to be acquired, or to attract new employees. Therefore, the Board of
Directors deems it to be in the best interest of the Company to remove the
limitation that any Participant in the Plan can receive only 75,000 options in
any calendar year.
If this proposed Amendment No. 2 is adopted, the provision providing that no
more than 75,000 options shall be awarded to any Participant in any calendar
year, which provision is found in the second paragraph of Section 6 of the Plan,
will be deleted effective January 1, 1998.
13
<PAGE>
No other provisions of the Plan will be changed or altered by this Amendment
No. 2. Options may continue to be granted under the Plan through September,
2005. Options granted under the Plan may either be incentive stock options or
non-qualified stock options.
This Amendment No. 2 will not become effective unless approved by the
holders of a majority of the outstanding Common Stock of the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF PROPOSAL 3 TO
AMEND THE PLAN.
PROPOSAL 4
AMENDMENT TO 1995 OUTSIDE DIRECTORS' STOCK OPTION PLAN
On March 24, 1998 the Board of Directors adopted an amendment to the
Company's 1995 Outside (non-employee) Directors' Stock Option Plan (the "Plan")
to be effective May 27, 1998, to reduce the number of non-qualified stock
options granted to outside directors under the Plan. Prior to this amendment,
outside directors are entitled to receive a non-qualified stock option to
purchase 24,750 shares of common stock of the Company every three years, one
third of which, or options for 8,250 shares, vest each year. It was noted at the
Board of Director's meeting on March 24, 1998 that outside directors will
receive other emoluments from the Company in 1998 and going forward, and
therefore the number of options granted should be reduced. If the proposed
amendment, as set forth below, is adopted, outside directors will receive a
non-qualified stock option to purchase 15,000 shares of common stock every three
years, one-third of which, or options for 5,000 shares, would vest each year. If
this amendment is approved, nothing shall affect the rights of any Non-Employee
Directors with reference to NQSOs heretofore granted.
If the proposed amendment is adopted effective May 27, 1998, Section 8 of
the Plan will read as follows:
"8. NON-QUALIFIED STOCK OPTIONS.
(a) GRANT OF NQSOS.
Any Non-Employee Director who first becomes a member of the Board on or
after the effective date of this amended Section 8(a), shall be granted
NQSOs to purchase 15,000 Shares automatically on the next succeeding
business day following his election to the Board. In addition to the initial
NQSO grants to each Non-Employee Director whether before, or after the
effective date of this amended Section, NQSOs to purchase 15,000 Shares
shall be granted automatically to each Non-Employee Director on the next
succeeding business day after the third consecutive annual meeting of the
shareholders following his initial NQSO grant, and on the next succeeding
business day after every third consecutive annual meeting of the
shareholders thereafter during the term of the Plan, provided that said
Non-Employee Director continues to be a member of the Board on the date of
each such additional grant. NQSOS shall be granted in the aforesaid manner
until the date on which the Shares available for grant shall no longer be
sufficient to permit grants of NQSOs covering 15,000 Shares to be made to
each Non-Employee Director entitled to a grant as of such date, in which
event the Shares then available for grant shall be allocated on a pro rata
basis among the Non-Employee Directors entitled to a grant of NQSOs as of
such date. The provisions of this Section shall not be amended more than
once every six months, other than to comport with changes in the Code, the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
the rules thereunder.
(b) EXERCISE PRICE.
Each Share covered by a NQSO granted on the business day next succeeding
the Effective Date of this Plan may be purchased at a purchase price equal
to the initial public offering price of a Share. Each Share covered by a
NQSO granted after the business day next succeeding the effective date of
this amended section may be purchased at a purchase price equal to the Fair
Market Value of a Share on the date of the NQSO grant. The provisions of
this Section shall not be amended more than once every six months, other
than to comport with changes in the Code, ERISA, or the rules thereunder.
14
<PAGE>
(c) TERMS AND CONDITIONS.
(i) Except as set forth in Section 10, all NQSOs granted to a
Participant shall vest and become first exercisable as follows:
i.i 5,000 shares on the next succeeding business day following a
Participant's initial election to the Board.
i.ii Thereafter, 5,000 shares on the next succeeding business day
following each annual meeting of the Stockholders of the Company.
No other provisions of the Plan will be changed or altered by this
amendment. This amendment will not become effective unless approved by holders
of a majority of the outstanding Common Stock of the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF PROPOSAL 4 TO
AMEND THIS PLAN.
SHAREHOLDER PROPOSALS
In accordance with the rules of the Securities and Exchange Commission,
shareholder proposals must be received by December 31, 1998 to be considered for
inclusion in the Proxy Statement for the 1999 Annual Meeting of Shareholders
which is expected to be held in May, 1999. It is suggested that any shareholder
desiring to submit a proposal, do so by Certified Mail, Return Receipt
Requested. Shareholders should also note that, in addition to the requirement of
timely receipt by the Board of Directors of a proposal as stated above, such
proposal will not be included in the proxy solicitation material for the 1999
Annual Meeting of Shareholders unless it otherwise complies with the
requirements of Section 14(a) of the Securities Exchange Act of 1934 and the
rules and regulations promulgated and in effect thereunder.
ADDITIONAL INFORMATION
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who beneficially own more than 10%
of the Company's stock, to file initial reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission ("SEC").
Executive officers, directors, and greater than 10% beneficial owners are
required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file. Marshall Geller failed to timely file a Form 4.
INDEPENDENT PUBLIC ACCOUNTANTS
KPMG Peat Marwick LLP ("KPMG"), certified public accountants, are the
independent public accountants for the Company.
Representatives of KPMG are expected to be present at the shareholders'
meeting and will be given the opportunity to make any statement they might
desire and will also be available to respond to appropriate questions from
shareholders. KPMG has been selected as independent public accountants for the
Company for fiscal 1998.
OTHER MATTERS
The Board of Directors does not know of any other matters to be presented at
the annual meeting. In the event that other business is properly brought before
the meeting, it is the intention of the proxy holders named in the proxy to vote
the proxies in accordance with the recommendation of the Board of Directors.
15
<PAGE>
BALLANTYNE OF OMAHA, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS FOR THE ANNUAL MEETING OF SHAREHOLDERS
MAY 27, 1998
The undersigned hereby constitutes and appoints John P. Wilmers and
Ronald H. Echtenkamp, or either of them, with full power to act alone, or any
substitute appointed by either of them as the undersigned's agents, attorneys
and proxies to vote the number of shares the undersigned would be entitled to
vote if personally present at the Annual Meeting of the Shareholders of
Ballantyne of Omaha, Inc. to be held at the Westin Aquila Hotel, 1615 Howard
Street, Omaha, Nebraska 68102, on the 27th day of May, 1998, at 4:00 p.m. or
any adjournments thereof, as indicated hereon.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF BOTH NOMINEES FOR DIRECTOR, FOR BOTH
AMENDMENTS TO THE 1995 STOCK OPTION PLAN, FOR THE AMENDMENT TO THE 1995
OUTSIDE DIRECTORS' STOCK OPTION PLAN, AND WITH DISCRETIONARY AUTHORITY ON ALL
OTHER MATTERS.
<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED |
IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED |
SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY |
WILL BE VOTED FOR THE ELECTION OF BOTH NOMINEES Please mark your |
FOR DIRECTOR, FOR BOTH AMENDMENTS TO THE 1995 STOCK votes as indicated | \X\
OPTION PLAN, FOR THE AMENDMENT TO THE 1995 OUTSIDE in this example |
DIRECTORS' STOCK OPTION PLAN, AND WITH DISCRETIONARY |
AUTHORITY ON ALL OTHER MATTERS. |
1. Election of Directors John P. Wilmers
and Colin G. Campbell
FOR the two nominees WITHHOLD (INSTRUCTION: To withhold
(except as marked to the AUTHORITY authority to vote for any
contrary to the right) to vote for two individual nominee, write
nominees listed to that nominee's name on the
the right. space provided below.)
\ \ \ \
2. Amendment No. 1 to 3. Amendment No. 2 to 4. Amendment to 1995 Outside
1995 Stock Option 1995 Stock Option Directors' Stock Option
Plan Plan Plan
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \
5. In their discretion, the proxies are Dated: , 1998
authorized to vote upon such other -------------
business as may properly come before
the meeting. -------------------------
Signature of Shareholder
-------------------------
Signature of Shareholder
Please sign exactly as
your name appears at the
left. When signing as
attorney, executor,
administrator, trustee,
guardian or conservator,
five full title. All joint
trustees must sign.
PLEASE MARK, SIGN, DATE
AND RETURN THE PROXY CARD
PROMPTLY USING THE
ENCLOSED ENVELOPE.
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