<PAGE> 1
================================================================================
SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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 Section 240.14a-11(c) or Section 240.14a-12.
</TABLE>
REGENCY AFFILIATES, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXXXXXXXXXXXXX
(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)(4) 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: .........................................................
(4) Date Filed: ...........................................................
================================================================================
<PAGE> 2
REGENCY AFFILIATES, INC.
June 23, 1999
Dear Stockholder:
You are cordially invited to attend the 1999 Meeting of Stockholders of
Regency Affiliates, Inc. to be held at the Omaha Marriott Hotel, 10220 Regency
Circle, Omaha, NE 68114 on August 5, 1999, at 10:00 a.m. local time. The Notice
of the 1999 Meeting of Stockholders and Proxy Statement accompanying this letter
describe the business to be transacted at the meeting.
During the meeting the Board of Directors will report to you on the
Company's progress during the past years and will discuss plans for the current
year. We welcome this opportunity to share our progress with you and look
forward to your comments and questions.
The Board of Directors appreciates and encourages stockholder participation
in the Company's affairs and we hope you can attend in person. Whether or not
you plan to attend the meeting, it is important that your shares be represented.
Therefore, please sign, date, and mail the enclosed proxy in the envelope
provided at your earliest convenience.
Sincerely,
William R. Ponsoldt
Chairman of the Board
<PAGE> 3
REGENCY AFFILIATES, INC.
729 SOUTH FEDERAL HWY, SUITE 307
STUART, FLORIDA 34994
------------------
NOTICE OF 1999 MEETING OF STOCKHOLDERS
AUGUST 5, 1999
To the Stockholders of Regency Affiliates, Inc.:
The 1999 Meeting of Stockholders of Regency Affiliates, Inc. (the
"Company") will be held at the Omaha Marriott Hotel, 10220 Regency Circle,
Omaha, NE 68114 on August 5, 1999, at 10:00 a.m. local time for the following
purposes:
1. To elect a Board of Directors to serve until the next Meeting of
Stockholders.
2. To approve Directors' compensation.
3. To ratify the appointment of Hausser + Taylor LLP as independent public
accountants.
4. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Stockholders of record at the close of business on June 15, 1999, (the
"Record Date") are entitled to notice of and to vote at the 1999 Meeting of
Stockholders.
It is important that your shares be represented at the 1999 Meeting of
Stockholders regardless of the number of shares you hold and whether or not you
are personally able to attend. Accordingly, please sign the enclosed proxy and
return it as soon as possible in the enclosed envelope provided for your
convenience.
By Order of the Board of Directors
William R. Ponsoldt
Chairman, President and CEO
Stuart, Florida
June 23, 1999
<PAGE> 4
REGENCY AFFILIATES, INC.
729 SOUTH FEDERAL HWY., SUITE 307
STUART, FLORIDA 77002
------------------
PROXY STATEMENT
1999 MEETING OF STOCKHOLDERS
AUGUST 5, 1999
---------------
GENERAL INFORMATION
This Proxy Statement is furnished to the holders of the Common Stock, $.40
par value per share ("Common Stock") in connection with the solicitation of
proxies by the Board of Directors of Regency Affiliates, Inc. (the "Company") to
be voted at the 1999 Meeting of Stockholders to be held on August 5, 1999, or
any adjournment thereof. The first mailing of the proxy material to the holders
of the Common Stock will be made on approximately June 25, 1999.
The cost of the solicitation of proxies will be borne by the Company. In
addition to the use of the mails, proxies may be solicited personally, or by
telephone or electronic media by regular employees of the Company. The Company
will reimburse brokers and other custodians, nominees or fiduciaries for their
expenses in forwarding proxy material to security owners and obtaining their
proxies.
Stockholders of record at the close of business on June 15, 1999 are
entitled to vote on matters to come before the meeting. On that date there were
outstanding and entitled to vote 12,632,089 shares of Common Stock. Each share
is entitled to one vote on each matter presented.
Any proxy may be revoked by a stockholder at any time before it is
exercised by giving written notice to that effect to the Secretary of the
Company or by signing a later-dated proxy. Stockholders who attend the 1999
Meeting of Stockholders may revoke any proxy previously granted and vote in
person.
All properly executed proxies will be voted in accordance with the
instructions contained thereon, and if no instruction is specified, the proxies
will be voted "FOR" the election of the nine directors named elsewhere in the
Proxy Statement, "FOR" approval of Directors' compensation, "FOR" ratification
of the appointment of Hausser + Taylor LLP as independent public accountants,
and in accordance with the instruction of the Board of Directors as to any other
matters. Abstentions do not constitute a vote "FOR" or "AGAINST" any matter
listed in the accompanying Notice of the 1999 Meeting of Stockholders, but will
be included in determining the number of shares present for purposes of
obtaining a quorum. Also broker "non-votes" (i.e. proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial or other persons entitled to vote shares on a particular matter with
respect to which the brokers or nominees do not have discretionary power) will
be treated as present for purposes of determining the presence of a quorum at
the 1999 Meeting of Stockholders. If such a quorum should not be present, the
1999 Meeting of Stockholders may be adjourned from time to time until the
necessary quorum is obtained.
1
<PAGE> 5
PROPOSAL 1
ELECTION OF DIRECTORS
Following is a list of the names, addresses, and ages of the nine nominees,
seven of whom are presently serving as Directors. Also included in the chart is
the year in which each became a Director of the Company. Following this list is
the past five-year business history of each Director nominee and any public
company directorships held by such persons. The proxy holders named in the proxy
intend to vote "FOR" the election of the nine nominees listed below unless
authority to so vote is withheld. In the unexpected event that any 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 that are
designated by the Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NINE
NOMINEES LISTED BELOW.
DIRECTOR
NAME AND ADDRESS AGE SINCE
---------------- --- --------
William R. Ponsoldt, Sr. 57 1996
729 South Federal Hwy., Suite 307
Stuart, Florida 34994
Stephanie Carey 48 1993
Beaumont House, 3rd Floor
King & George St., P.O. Box CB-10985
Nassau, Bahamas
Larry J. Horbach 57 1987
1869 So. 120th Street
Omaha, NE 68144
Martin J. Craffey 61 1993
58 Mainsail Drive
Patchogue, New York 11772
Pamlyn Kelly, Ph.D. 55 1993
10 Winged Foot Drive
Novato, California 94949
William R. Ponsoldt Jr. 33 1993
770 S. W. Lighthouse Dr.
Palm City, Florida 34990
Fredric R. Lowe 55 1997
1345 Avenue of the Americas, 21st Floor
New York, NY 10105
Donald D. Graham 65 Nominee
14012 Giles Road, Suite 2
Omaha, Nebraska 68138
Marc H. Baldinger 43 Nominee
850 Lighthouse Drive
Palm City, Florida 34990
2
<PAGE> 6
WILLIAM R. PONSOLDT, SR.. Mr. Ponsoldt has served as Chairman of the Board
of Directors since August, 1996 and as President and CEO since June, 1997. On
April 16, 1999 Mr. Ponsoldt was elected to fill a vacant position on the Board
of Directors of Glas-Aire Industries Group Ltd. ("Glas-Aire") and was elected
Chairman of the Board of Glas-Aire at that time. (See additional information
later). During the past five years, Mr. Ponsoldt has served as the portfolio
manager for several hedge funds. Mr. Ponsoldt is the father of William R.
Ponsoldt, Jr. a director of the Company.
STEPHANIE CAREY. Ms. Carey is a principal and the Investment Manager for
Managed Companies with Bradley Management (Bahamas) Limited. She is also a
director of Regal Bahamas International Airways Limited.
LARRY J. HORBACH, Mr. Horbach was a director from 1987 to 1990, from 1992
to February 15, 1994 and since November 16, 1994. He has served as the interim
secretary and treasurer from July 1993 until his resignation effective February
15, 1994. He has served as Chairman of the Board and has held other executive
positions, including President and CEO of Gateway Energy Corporation in the past
five years. In addition, during the last five years, he has been associated with
L. J. Horbach & Associates, and a director of Gateway Energy Corporation and
Templeton Savings Bank.
MARTIN J. CRAFFEY. Mr. Craffey was a real estate and business broker and
contract vendee with Prudential Realty of Long Island, New York from January
1988 until December 31, 1993. Mr. Craffey is presently self-employed seeking
financing for, and reorganizing, real estate projects.
PAMLYN KELLY, Ph.D. Dr. Kelly is principal and Chief Executive Officer of
Human Resource Concepts, Novato CA, a registered minority owned management
consulting firm. She also has a private practice.
WILLIAM R. PONSOLDT JR. Mr. Ponsoldt is an attorney engaged in the private
practice of law in Florida with the firm of Warner, Fox, Seeley, Dungey & Sweet.
Formerly, he was with Kohl, Metzter, Spotts, Ponsoldt & Tapper, P. A. Mr.
Ponsoldt is the son of William R. Ponsoldt, Sr.
FREDRIC R. LOWE. Mr. Lowe has been employed as a retail stock broker during
the past five years. For the past four years he has been employed by Smith
Barney and prior to that he was employed by its predecessor, Lehman Brothers.
DONALD D. GRAHAM. Mr. Graham serves as President of Graham Enterprises,
Inc. He also serves on the Board of Directors of Interactive Network.
MARC H. BALDINGER, Mr. Baldinger is a senior officer in financial services
for Riverside National Bank, located in Palm City, Florida. Prior to his
employment at Riverside, he was a certified financial planner for American
Express Financial Advisors, Inc. and Linsco Private Ledger. Mr. Baldinger was
elected to fill a vacant position on the Board of Directors of Glas-Aire on
April 16, 1999.
Each of Messrs. Ponsoldt, Jr. and Craffey, Dr. Kelly and Ms. Carey were
appointed directors of the Company by Statesman as part of the closing of the
National Resource Development Corporation ("NRDC") Transaction on July 7, 1993
(See additional information later). Each had an understanding with Statesman
Group, Inc. ("Statesman") and/or the Company that as an inducement to accept
their positions as directors he or she would receive certain consideration from
Statesman and/or the Company. Dr. Kelly and Ms. Carey each received 100,000
shares of the Company's Common Stock from Statesman while Messrs. Ponsoldt, Jr.,
and Craffey received options to purchase shares of the Company's Cumulative
Senior Preferred $100 Series-C Stock.
Mr. Horbach was a Director of the Company from 1987 to 1990 and again from
1992 to February 15, 1994. He rejoined the Board on November 16, 1994. Mr.
Horbach served as the interim President of the Registrant on a part time basis
until the closing of the 1993 NRDC Transaction. On February 7, 1995, Regency
Affiliates, Inc. entered into an agreement with L.J. Horbach & Associates
pursuant to which L.J. Horbach & Associates provides certain accounting and
administrative services to the Company for a monthly fee of $3,000. L.J. Horbach
& Associates, is wholly owned by Larry J. Horbach.
3
<PAGE> 7
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
To the best of the Company's knowledge, the only beneficial owners of more
than five percent of Regency's voting securities as of June 15, 1999 are listed
below:
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL PERCENT OF
TITLE OF CLASS BENEFICIAL OWNER OWNERSHIP CLASS
-------------- ------------------- ----------------- ----------
<S> <C> <C> <C>
Regency Affiliates, Inc. Statesman Group, Inc. 3,126,377 24.7%
$0.40 P.V. King & George Streets
Common Stock Nassau, Bahamas
Regency Affiliates, Inc. Edward E. Gatz 1,135,750 9.0%
$0.40 P.V. 10029 Frederick St.
Common Stock Omaha, NE 68124
</TABLE>
- ------------------
The nature of beneficial ownership is sole investment power and sole voting
power as to all shares listed.
Edward E. Gatz is a private investor.
Statesman Group, Inc. is an international business corporation organized
under the laws of the Bahamas. Statesman's principal business is the making of
investments in the United States and elsewhere. Both its principal business and
principal office are located at King & George Streets, Nassau, Bahamas. The
Statesman Irrevocable Trust dated April 15, 1991 is the controlling person of
Statesman. The Statesman Trust is an irrevocable trust for the benefit of
William R. Ponsoldt, Jr., a director of the Company, Tracey A. Ponsoldt, now
married and sometimes known as Tracey A. Powers, and Christopher J. Ponsoldt,
all children of William R. Ponsoldt, Sr. The acting trustees of The Statesman
Trust dated April 15, 1991, have the sole right to control the disposition of
and vote the Regency securities acquired by Statesman. Pursuant to the terms of
the 1993 transaction between the Company and National Resource Development
Corporation ("NRDC") through which the Company acquired an 80% interest in NRDC
(the "NRDC Transaction') Statesman designated seven members to fill the then
existing vacancies on the Board of Directors. Also pursuant to the NRDC
Transaction, the right to vote certain irrevocable proxies (855,991 of Regency
Common Shares) was delivered to a proxy committee of the Board of Directors.
Statesman, in addition to owning the shares of the Company's Common Stock
received in the NRDC Transaction, through its right to designate the seven
persons to fill the then existing vacancies on the Board of Directors until a
shareholders' meeting, effectively has current voting control of a total of
3,982,368 shares, or approximately 32% of the 12,632,089 outstanding shares as
of June 15, 1999.
4
<PAGE> 8
The following table sets forth information concerning the shares of Common
Stock beneficially owned by (i) each nominee for director and each director of
the Company; (ii) each of the executive officers of the Company; and (iii) all
directors and executive officers as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME OF BENEFICIAL OF
TITLE OF CLASS OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
- -------------- ------------------ -------------------- ----------------
<S> <C> <C> <C>
Regency Affiliates, Inc. $0.40 Larry J. Horbach 363,397(1) 2.9%
P.V. Common Stock
Regency Affiliates, Inc. $0.40 Pamelyn Kelly 100,000 .8%
P.V. Common Stock
Regency Affiliates, Inc. $0.40 Donald D. Graham 490,000 3.8%
P.V. Common Stock
Regency Affiliates, Inc. $0.40 Eunice M. Antosh 62,345 .5%
P.V. Common Stock
Regency Affiliates, Inc. $0.40 All officers and 1,015,742 8.0%
P.V. Common Stock directors as a group
(10 individuals)(2)
</TABLE>
- ------------------
(1) An irrevocable proxy with respect to these shares, so long as the shares are
held by Mr. Horbach, was given to a proxy committee of the Board of
Directors as part of the NRDC Transaction.
(2) Directors and executive officers not listed above claim no beneficial
ownership in the Company's $0.40 P.V. Common Stock.
CUMULATIVE SENIOR PREFERRED $100 SERIES-C STOCK
As of June 15, 1999 certain members of the Board of Directors of Regency
Affiliates, Inc. held warrants to purchase Cumulative Senior Preferred $100
Series-C Stock from Statesman Group, Inc., as follows: William R. Ponsoldt, Jr.
(warrants to purchase 1,000 shares); and Martin J. Craffey (warrants to purchase
1,000 shares). Statesman received 208,850 shares (100% of the issued and
outstanding Series C shares) as part of the NRDC Transaction.
SERIES-D JUNIOR PREFERRED STOCK - $10 STATED VALUE
Larry J. Horbach and Donald D. Graham hold 1,238 and 4,072 shares
respectively of the Series-D Junior Preferred Stock - $10 Stated Value over
which each has sole voting power and sole investment power. There are currently
25,694 Series D Preferred Shares outstanding.
ADDITIONAL INFORMATION CONCERNING THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD OF DIRECTORS
The business of the Company is managed under the direction of the Board of
Directors. There were 3 meetings in the year ended December 31, 1998. During the
last year, no director attended fewer than 75% of all of the meetings of the
Board of Directors. The Board of Directors has established an Audit Committee.
Larry Horbach, William R. Ponsoldt, Jr. and Dr. Kelly comprise the Audit
Committee. The Audit Committee recommends the independent auditors to the Board
and meets with the independent auditors to discuss matters pertaining to the
audit and any other matters which the auditors may wish to discuss. The
Committee met once
5
<PAGE> 9
during the year. The Board of Directors does not have a Compensation or
Nominating Committee. Compensation matters, as well as the issuance of stock
options related to Company executive officers, are the responsibility of the
full Board, absent any affected executive officer who is also a director.
COMPENSATION OF DIRECTORS
Currently the members of the Board of Directors each receive the sum of
$500 plus out of pocket expenses for their attendance at director's meetings.
At a meeting of the Board of Directors held on October 10, 1997, the Board
approved, subject to approval by the shareholders of the Company, compensation
for directors providing for (I) an annual retainer for directors of $10,000,
payable one-half in cash and one-half in the Common Stock of the Company, (ii) a
fee of $125/hour, with a two hour minimum, for attendance at each meeting of the
Board or committee thereof, and (iii) an award of an option to each director for
the purchase of 10,000 shares of the Company's Common Stock. This compensation
will be implemented effective on the date of the shareholder's approval.
AGGREGATED OPTION/SAR EXERCISES IN LAST YEAR AND YEAR END OPTION/SAR VALUES
Stock Options.
The Option/SAR Grants Table is omitted as there were no individual grants
of stock options (whether or not in tandem with SARs) nor freestanding SARs made
during the last completed fiscal year to any of the named executive officers.
The Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End
Option/SAR Values table is omitted as there were no exercise of stock options
(nor tandem SARs) nor freestanding SARs during the last completed fiscal year by
any of the named executive officers.
Stock Options Granted to Statesman Group, Inc.
Pursuant to an Agreement dated June 3, 1997, as amended and restated on
March 24, 1998, Statesman Group, Inc. was granted options to purchase 6.1
million shares of Common Stock. Statesman owned approximately 25% of the
Company's outstanding common stock prior to the issuance of these options. The
options were issued to Statesman in order to secure the release of Mr. William
R. Ponsoldt, Sr. to serve as President and Chief Executive Officer of the
Company and pursuant to the Amended and Restated Agreement between the Company
and Statesman, until their date of expiration, the options shall be exercisable
at any time in whole or in part at a price equal to the lower of (a) the closing
trading price as of the most recent date on which at least 10,000 shares of such
stock were traded, or (b) the average closing trading price of the shares during
the ninety day period immediately preceding the date of exercise. The Company
agreed to reserve sufficient shares to meet the requirements of the options. The
options became exercisable immediately and remain exercisable until April 15,
2007. At the option of Statesman, payment may be made by Statesman for exercise
of the options, in whole or in part, in the form of a promissory note executed
by Statesman, secured only by a pledge of the shares purchased, which promissory
note will accrue interest for any quarter at the prime rate in effect on the
last day of the quarter at Chase Manhattan Bank, with interest and principal
payable in a balloon payment five years after the date of execution of the note,
provided that if the Company's Board of Directors reasonably determines that
exercising the options by delivery of a note would render the respective
purchase of shares void or voidable, then the Board may require, as a condition
to exercise of the options, that Statesman either (i) pay at least the par value
of the shares in cash (with the balance paid by delivery of a note), or (ii)
provide acceptable collateral other than the shares themselves to secure payment
of the note. The Company received no cash consideration with respect to the
issuance of the securities to Statesman, no commissions were paid, and no
underwriter was involved. The options granted to Statesman have no readily
determinable value and, therefore, the Company has not recognized any costs
associated with the issuance of these options.
Incentive Stock Option Plans.
The Company has reserved 500,000 shares of its Common Stock for issuance
under the 1988 Incentive Stock Plan. There are no options to purchase stock
outstanding under this plan.
6
<PAGE> 10
Other.
The Long-Term Incentive Plan Awards Table, the Pension Plan Table, the
Report on Repricing of Options/SARs Table and the Performance Graph are omitted
as non-applicable for the Company for the year ended December 31, 1998.
EXECUTIVE COMPENSATION
Summary Compensation Table.
The following table sets forth the annual and long-term compensation during
the last three years of William R. Ponsoldt, Sr., Douglas F. Long and Eunice M.
Antosh, the only officers who received compensation during 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------- -------------------------
AWARDS PAYOUTS
---------- -------
(A) (B) (C) (D) (E) (F) (G) (H) (I)
Other Restricted Securities
Name and Annual Stock Underlying LTIP All
Principal Salary Bonus Compensation Award(s) Options/SARs Payouts Other
Position Year ($) ($) ($) ($) (#) ($) Compensation
- --------- ---- ------ ----- ------------ ---------- ------------ ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
William R. 1998 252,333(1) 373,022(2) 7,200 -0-(3) -0- -0- -0-
Ponsoldt, Sr. 1997 250,000(1) 292,500(2) 5,700 -0-(3) -0- -0- -0-
Chairman 1996 -0- -0- -0- -0- -0- -0- -0-
Pres/CEO
Douglas F. Long, 1998 52,800 -0- 2,400 -0- -0- -0- -0-
CFO 1997 25,600 -0- -0- -0- -0- -0- -0-
1996 -0- -0- -0- -0- -0- -0- -0-
Eunice M. Antosh, 1998 12,000 -0- -0- -0- -0- -0- -0-
Secretary 1997 12,000 -0- -0- -0- -0- -0- -0-
1996 12,000 -0- -0- -0- -0- -0- -0-
</TABLE>
- ------------
(1) Mr. Ponsoldt's salary is to be adjusted on January 1 of every year by any
increase since the previous January 1 in the Consumer price Index ("CPI")
for All Urban Consumers, U.S. city average, as published by the U.S.
Department of Labor Bureau of Labor Statistics.
(2) Under the terms of Mr. Ponsoldt's Employment Agreement dated June 3, 1997,
he is entitled to receive as additional compensation an amount equal to 20%
of the Company's increase in quarterly common stock net worth, which is
defined to be the difference between (i) total shareholders' equity and
(ii) any shareholders' equity accounts relating to preferred stock.
(3) Pursuant to an Agreement dated June 3, 1997 between the Company and
Statesman Group, Inc., which agreement provided for the release of
Mr. Ponsoldt to assume the offices of President and CEO of the Company,
466,667 shares of the Company's $0.40 P.V. Common Stock were issued to
Statesman at a value of $233,333.
7
<PAGE> 11
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 past five years and the
year in which each person became an Officer of the Company.
<TABLE>
<CAPTION>
OFFICER
NAME AGE POSITION & PRINCIPAL OCCUPATION FOR LAST FIVE YEARS SINCE
---- --- --------------------------------------------------- -------
<S> <C> <C> <C>
William R. Ponsoldt 57 Director since June, 1996. Chairman of the Board 1997
of Directors since August, 1996. President and CEO
since June, 1997. Mr. Ponsoldt was appointed
Chairman of the Board of Glas-Aire in April 1999.
During the past five years, Mr. Ponsoldt served as
the portfolio manager for several hedge funds.
Douglas F. Long 54 Chief Financial Officer of the Company since 1998
March, 1998 and previously an employee. During
the past five years Mr. Long was involved in
business and real estate development matters.
Eunice M. Antosh 49 Secretary of the Company since February 25, 1994. 1994
Mrs. Antosh has also been employed by Gateway
Energy Corporation.
</TABLE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Martin J. Craffey, was paid $4,750 for consulting primarily with respect to
the operations of Rustic Crafts, International, Inc. during 1998.
On February 7, 1995, Regency Affiliates, Inc. entered into an agreement
with L.J. Horbach & Associates pursuant to which L.J. Horbach & Associates
provides certain accounting and administrative services to the Company for a
monthly fee of $3,000. L.J. Horbach & Associates is wholly owned by Larry J.
Horbach.
On June 3, 1997, Regency entered into an Employment Agreement with
William R. Ponsoldt, Sr. pursuant to which he became the President and CEO of
the Company. The Agreement provides for Mr. Ponsoldt to continue in these duties
until his attainment of retirement age, provided that he may resign upon 30 days
notice to the Company and further provided that Mr. Ponsoldt may be removed from
office upon death or disability or for just cause. The Agreement provides for an
annual base salary of $250,000 which salary is to be adjusted on January 1 of
every year by any increase since the previous January 1 in the Consumer Price
Index ("CPI") for All Urban Consumers, U.S. city average, as published by the
U.S. Department of Labor, Bureau of Labor Statistics. As additional
compensation, Mr. Ponsoldt is to receive an amount equal to 20% of the Company's
increase in quarterly common stock net worth, which is defined to be the
difference between (i) total shareholders' equity and (ii) any shareholders'
equity accounts relating to preferred stock. The Company may elect to pay up to
50% of the additional compensation by the issuance of warrants to purchase the
Company's Common Stock at a price equal to 50% of the average bid price for the
Company's Common Stock for the calendar quarter for which the increased
compensation is payable. The Agreement further provides for Mr. Ponsoldt to
receive health and disability insurance (with a benefit of $100,000/year payable
in the event of long term disability), an automobile allowance of $600/month (to
be adjusted by increases in the CPI), and reimbursement of expenses. The
Agreement provides that Mr. Ponsoldt will not compete with the Company for a
two-year period following the termination of his employment and provides for
indemnification under certain circumstances. Any disputes between the Company
and Mr. Ponsoldt under the Agreement are to be resolved through arbitration.
8
<PAGE> 12
PROPOSAL 2
APPROVAL OF DIRECTORS' COMPENSATION
The Board has directed that Directors' compensation be submitted to the
stockholders for approval. The affirmative vote of a majority of the shares of
Common Stock present or represented and entitled to vote on the proposal at the
1999 Meeting of Stockholders is required for approval. If the stockholders do
not approve, the Board will reconsider the Directors' compensation. The
Directors' compensation, which will become effective as of the shareholder
approval date, provides for the following:
- An annual retainer for directors of $10,000, payable one-half in cash and
one-half in the Common Stock of the Company, such stock to be valued at
the average bid price for the Common Stock for the 30 days succeeding
their election to the Board.
- A cash fee of $125 per hour for each Board, Committee, or Stockholders'
meeting attended; provided that multi-day meetings and specific
consultations with the Company's executive management lasting at least
eight hours are compensated on a flat per diem rate of $1,000.
- An annual award of an option to purchase 10,000 shares of the Company's
Common Stock, at fair market value on date of grant.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
DIRECTORS' COMPENSATION.
PROPOSAL 3
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board has directed that the appointment of Hausser + Taylor LLP be
submitted to the stockholders for approval. The affirmative vote of a majority
of the shares of Common Stock present or represented and entitled to vote on the
proposal at the 1999 Meeting of Stockholders is required for approval. If the
stockholders do not approve, the Audit Committee and the Board will reconsider
the appointment.
Representatives of Hausser + Taylor LLP are expected to be present at the
1999 Meeting of Stockholders. They will be available to respond to appropriate
questions and will have an opportunity to make a statement if they so desire.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF HAUSSER + TAYLOR LLP AS INDEPENDENT PUBLIC ACCOUNTANTS.
OTHER BUSINESS
Management does not intend to bring any business before the 1999 Meeting of
Stockholders other than the matters referred to in the accompanying notice and
at this date has not been informed of any matters that may be presented to the
1999 Meeting of Stockholders by others. If, however, any other matters properly
come before the 1999 Meeting of Stockholders, it is intended that the persons
named in accompanying proxy will vote in accordance with the instructions of the
Board of Directors on such matters.
ANNUAL REPORT
The Company's annual report on Form 10-K for the year ended December 31,
1998 is being mailed to all stockholders concurrently herewith. The Form 10-K is
not a part of the proxy solicitation material. Additional copies of the Form
10-K for the year ended December 31,1998, will be provided, without charge, upon
written
9
<PAGE> 13
request from any stockholder to: Regency Affiliates, Inc., Attention: Corporate
Secretary, 10842 Old Mill Road, Suite 5B, Omaha, Nebraska 68154.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16 (a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's officers and directors and persons who
own more than 10% of the registered class of the Company's equity securities to
file reports of ownership on Form 3 and changes in ownership on Form 4 or Form 5
with the Securities and Exchange Commission (the "SEC"). Such officers,
directors, and 10% stockholders are also required by the SEC rules to furnish
the Company with copies of all Section 16(a) forms they file. For the year ended
December 31, 1998, the Company is not aware of any such persons having failed to
timely file any such reports.
STOCKHOLDER PROPOSALS FOR 2000
Stockholders may submit proposals on matters appropriate for stockholder
action at the Company's 2000 Meeting of Stockholders, consistent with
regulations adopted by the Securities and Exchange Commission. Proposals to be
considered for inclusion in the Proxy Statement for the 2000 Meeting of
Stockholders must be received by the Company not later than March 15, 2000.
Proposals should be directed to the attention of Corporate Secretary, 10842 Old
Mill Road, Suite 5B, Omaha, Nebraska 68154.
10
<PAGE> 14
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 ALL NOMINEES FOR DIRECTOR; FOR APPROVAL OF DIRECTORS
COMPENSATION; FOR THE RATIFICATION OF THE INDEPENDENT PUBLIC ACCOUNTANTS, AND
WITH DISCRETIONARY AUTHORITY ON ALL OTHER MATTERS.
WITHHOLD
AUTHORITY
FOR the nine nominees to vote for nine
Election of (except as indicated nominees listed William R. Ponsoldt, Sr.
1. Directors: below) to the right Stephanie Carey
[ ] [ ] Larry J. Horbach
Martin J. Craffey
(INSTRUCTION: To withhold authority to vote for any Pamlyn Kelly
individual nominee, write that nominee's name on the William Ponsoldt, Jr.
space provided below.) Fredric R. Lowe
Donald L. Graham
____________________________________________________ Marc H. Baldinger
Please mark your
votes as indicated
in this example [X]
FOR AGAINST ABSTAIN
2. Approval of Directors' compensation. [ ] [ ] [ ]
3. Ratification of independent public accountants. [ ] [ ] [ ]
4. In their discretion, the proxies are authorized
to vote upon such other business as may properly
come before the meeting.
Dated: ___________________________________________________________________, 1999
________________________________________________________________________________
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, give full title.
All joint trustees must sign.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
REGENCY AFFILIATES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE 1999 MEETING OF STOCKHOLDERS
AUGUST 5, 1999.
The undersigned hereby constitutes and appoints William R. Ponsoldt, Sr. and
Larry J. Horbach, or either of them, with full power to act alone, or any
substitute appointed by either of them, 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 1999 Meeting of Stockholders of Regency
Affiliates, Inc., to be held at the Omaha Marriott Hotel, 10220 Regency Circle,
Omaha, NE 68114 on the 5th day of August, 1999, at 10:00 a.m. local time or any
adjournments as indicated on the reverse.
(TO BE SIGNED ON REVERSE SIDE)
