| o | Fee paid previously with preliminary materials. | | ![[ ]](https://files.docoh.com/DEF 14A/0000950136-08-002777/ebox.gif) | | | o | Check boxboxes if any part of the fee is offset as provided by Exchange Act Rule 0-11 (a) 0-11(a)(2) and identifyidentifies the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the formForm or scheduleSchedule and the date of its filing. |
| | | | (1) | Amount Previously Paid: |
&n bsp;
| | | | (2) | Form, Schedule or Registration Statement No.: |
&n bsp;
&n bsp;
&n bsp;
FIRSTFLIGHT, INC. 101 Hangar Road Wilkes-Barre/Scranton International Airport Avoca, Pennsylvania 18641 236 Sing Sing RoadElmira-Corning Regional AirportHorseheads, NY 14845NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 18, 2009
To the Stockholders of
The Annual Meeting of Stockholders of FirstFlight Inc. (the ‘‘Company’’) will be held in the Valencia Roomoffices of the San Carlos Hotel,Wachtel & Masyr, LLP, located at 150110 East 5059th Street, New York, NY 10022, on Thursday, June 19, 2008,18, 2009, at 10:00 a.m., Eastern Daylight Time, (the ‘‘Annual Meeting’’), for the following purposes:
| | | | 1. | To elect ninefive directors to serve until the next Annual Meetingannual meeting of Stockholdersstockholders and until their successors are duly elected and qualify.qualified; and |
Our Board of Directors has fixed the close of business on May 14, 2009 as the record date for the determination of stockholders entitled to notice of and to vote at the annual meeting and any adjournment thereof. Only stockholders of record at the close of business on Friday,Thursday, May 16, 2008,14, 2009, are entitled to notice of, and to vote at, the Annual Meetingannual meeting or any adjournment thereof. In order to vote at the Annual Meetingannual meeting, a stockholder of record, or his, her or its proxy, must be physically present at the Annual Meeting. There will be no means of electronic communications by which stockholders and proxies shall be deemed to be present in person and vote.annual meeting. | By Order of the Board of Directors
/s/ Ronald J. Ricciardi
Ronald J. Ricciardi President and Chief Executive Officer |
| Robert W. Berend
Secretary |
May 22, 2008 18, 2009
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, PLEASE DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE. THE PROXY MAY BE REVOKED IN WRITING PRIOR TO THE MEETING OR, IF YOU ATTEND THE MEETING, YOU MAY REVOKE THE PROXY AND VOTE YOUR SHARES IN PERSON.
FIRSTFLIGHT, INC. 236 Sing Sing RoadElmira-Corning Regional AirportHorseheads, NY 14845PROXY STATEMENT
2009 ANNUAL MEETING OF STOCKHOLDERS
June 19, 2008This Proxy StatementThe enclosed proxy is furnished in connection with the solicitation bysolicited on behalf of the Board of Directors of FirstFlight, Inc. (the ‘‘Company’’) of proxies to be voted, a Nevada corporation, for use at the Company’s Annual Meetingannual meeting of Stockholders (the ‘‘Meeting’’)stockholders to be held on Thursday, June 19, 2008,18, 2009, at 10:00 Eastern Daylight Time, or at any adjournment thereof. Theor postponement thereof, for the purposes for which the Meeting is to be held are set forth in this proxy statement and in the precedingaccompanying Notice of Annual Meeting. This Proxy StatementMeeting of Stockholders.
Location of Annual Meeting
The annual meeting will be held at the offices of Wachtel & Masyr, LLP, which are located at 110 East 59th Street, New York, New York 10022.
Principal Executive Offices
Our principal executive offices are located at 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, and the enclosed form ofour telephone number is (570) 457-3400.
Mailing Date
These proxy solicitation materials are first being mailed by us on or about Tuesday, May 22, 2008,18, 2009 to holdersall stockholders entitled to vote at the annual meeting.
Record Date and Outstanding Shares
Stockholders of record of the Company’s Common Stock, $.001 par value (the ‘‘Common Stock’’), as ofat the close of business on Friday, May 16, 2008 (the ‘‘Record Date’’), which has been fixed as14, 2009, the record date for the determination of the stockholdersannual meeting, are entitled to notice of and to vote at the Meeting.VOTING SECURITIES
Onannual meeting. We have one class of shares outstanding, designated as common stock, $0.001 par value per share. As of the Record Date, 36,582,987record date, 33,754,453 shares of the Common Stock, which is the only class entitled to vote at the Meeting,our common stock were issued outstanding and entitledoutstanding.
Solicitation of Proxies
We are making this solicitation of proxies, and we will bear all related costs. We may reimburse brokerage firms and other persons representing beneficial owners of shares for their expenses in forwarding solicitation material to vote. Each stockholder of record is entitled to cast,beneficial owners. Proxies may also be solicited on our behalf, in person or by telephone or facsimile, by our directors, officers and employees, none of whom will receive additional compensation for doing so.
Revocability of Proxies
You may revoke any proxy one votegiven pursuant to this solicitation, at any time before it is voted, by either: | · | delivering a written notice of revocation or a duly executed proxy bearing a later date; or |
| · | attending the annual meeting and voting in person. |
Quorum
A quorum is required for each share of the Common Stock held by such stockholder as of the close ofstockholders to conduct business on the Record Date. A plurality of the votes cast at the Meeting shall be necessary to elect each ofannual meeting. Our bylaws provide that a quorum will exist at the nine directors (i.e., Proposal One). The affirmative vote ofannual meeting if the holders of a majority of the shares of our common stock entitled to vote are present, in person or by proxy, at the annual meeting.
Voting
Each stockholder is entitled to one vote for each share held as of the record date. A stockholder may vote at the annual meeting by attending the meeting and voting in person or by submitting a proxy. When proxies are properly dated, executed and returned, the shares represented by such proxies will be voted at the annual meeting in accordance with the instructions on such proxies.
If no specific instructions are given, all shares represented by proxies will be voted: | · | FOR the election of the five nominees for directors named in this proxy statement |
Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the Meeting shall be necessaryannual meeting, you must bring to authorizethe annual meeting a possible reverse stock split in an amount and at a time authorized byletter from the Board of Directors of the Company (i.e., Proposal Two).A majoritybroker, bank or other nominee confirming both (1) your beneficial ownership of the shares entitledand (2) that the broker, bank or other nominee is not voting the shares at the annual meeting.
Vote Required
The table below shows the vote required to vote, presentapprove the proposal described in person or represented bythis proxy constitutesstatement, assuming the presence of a quorum at the Meeting. annual meeting.
| Proposal | | Vote Required | | | | | | | 1. Election of five directors | | Plurality of the votes duly cast at the annual meeting |
Abstentions and broker non-votes
Shares that abstain from voting on one or more proposals to be acted on at the annual meeting are treatedconsidered to be present for the purpose of determining whether a quorum at the Meetingexists and are not treatedentitled to vote on all proposals properly brought before the annual meeting. Abstentions will have no effect on the election of directors.
Broker Non-Votes
Under the rules governing brokers who have record ownership of shares that they hold in “street name” for their clients who are the beneficial owners of such shares brokers have the discretion to vote such shares on routine matters, such as a vote for or against a proposal.Proposals will be voted as indicated in this Proxy Statementdirector elections and the enclosed proxy. Shares presented by properly executed proxies, if received in time, will be voted in accordance with any specifications made therein.ratification of the selection of an independent registered public accounting firm, but not on non-routine matters. A proxy may be revoked by delivering a written notice of revocation to the Company (Attention: Robert W. Berend, Secretary) at its principal executive office or in person at the Meeting, or“broker non-vote” occurs when shares held by a subsequently dated proxy, at any time prior tobroker are not voted on a non-routine proposal because the broker has not received voting thereof. The principal executive office ofinstructions from the Company is located at the address in the heading to this Proxy Statement.
Rules 451 and 452 of the New York Stock Exchange, Inc. (the ‘‘NYSE’’) permit a member firm to vote for the directors nominated by the Board if the member firm holds the shares of the Common Stock for a beneficial owner and receives no instructions to the contrary by the tenth day before the Meeting. However, under these Rules the beneficial owner must give specific instructions to the member firm for itbroker lacks discretionary authority to vote the stockholder’s shares in the absence of such instructions.
Shares subject to broker non-votes are considered to be present for the purpose of determining whether a quorum exists and thus count towards satisfying the quorum requirement. Because the proposal to elect directors is considered to be a “routine” matter, it cannot give rise to broker non-votes.
Annual Report to Stockholders and Annual Report on Proposal TwoForm 10-K
We have enclosed our 2009 annual report to authorizestockholders with this proxy statement. Our annual report on Form 10-K for the fiscal year ended December 31, 2008, as filed with the Securities and Exchange Commission, is included in the 2009 annual report. The 2009 annual report includes our audited consolidated financial statements, along with other information about us, which we encourage you to read.
You can obtain, free of charge, an additional copy of our Form 10-K by:
| · | writing to us at 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary; |
| · | telephoning us at (570) 457-3400; or |
| · | visiting our website at www.fflt.com under the heading “Investor Relations.” |
You can also obtain a possible reverse stock split in an amountcopy of our annual report on Form 10-K for the fiscal year ended December 31, 2008 and all other reports and information that we file with, or furnish to, the Securities and Exchange Commission from the Securities and Exchange Commission’s EDGAR database at www.sec.gov. Any information contained on our website is not a time determinedpart of this proxy statement.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON JUNE 18, 2009
As required by the Board of Directors of the Company. Rules 576 and 577 of the American Stock Exchange LLC (the ‘‘AMEX’’) are substantially similar to the foregoing NYSE Rules so that the beneficial owner’s specific instructions are also required for the AMEX member firms to vote on Proposal Two. Rule 2260 (c)(2) of the Financial Industry Regulatory Authority (‘‘FINRA’& rsquo;) permits a FINRA member firm to deliver a proxy, with respect to shares of the Common Stock heldrules adopted by the FINRA member firm for a beneficial owner, pursuantSecurities and Exchange Commission, we are making this proxy statement and our annual report to shareholders available on the rules of any national securities exchange (such as the NYSE and the AMEX) to which the FINRA member firm is also responsible provided that the records of the member firm clearly indicate which procedure it is following.Internet.
Table of ContentsThe Company, accordingly, urges each beneficial ownerproxy statement and annual report to instructsecurity holders are available at www.FFLT.com/investorrelations/secfilings
For directions on a timely basishow to attend the member firm which holds of record the stockholder’s shares of the Common Stock toannual meeting and vote in favorperson, please review the “Voting” section on page 2 of the two proposals submitted to the stockholders for a vote, because such instruction is required for one of the two proposals.A stockholder shall have no right to receive payment for his, her or its shares as a result of stockholders’ approval of any proposal in the Notice of Annual Meeting.
Each of the persons who has served as a director or as an executive officer of the Company since January 1, 2007 (this proxy statement.i.e., the beginning of the last fiscal year of the Company), each of the persons nominated by the Board of Directors of the Company for election as a director at the Meeting, each of which nominees is currently serving as a director, and each associate of the foregoing persons has no substantial interest, direct or indirect, by security holdings or otherwise, in any of the proposals submitted to a vote at the Meeting, other than, if he is a nominee for election as a director, that he has an interest in being elected as a director (i.e., Proposal One).
As of the Record Date, the directors and executive officers of the Company and their family members and associates collectively could vote an aggregate of 13,566,792 shares or 37.1% of the 36,582,987 shares of the Common Stock entitled to vote. All of such persons have indicated to the Company that they intend to vote their shares in favor of the two proposals to be submitted to a vote at the Meeting. Accordingly, because there is no cumulative voting for the election of directors and because a plurality of the votes cast is necessary to elect a director, such votes of management and associates are highly likely to result in the re-election of the Board’s nominees as directors. Such votes would also give a strong impetus to a favorable vote on the other proposal.
PROPOSAL ONE: ONE
Nominees Proposed for Election as Directors Nine
Our articles of incorporation and bylaws provide for a board of directors consisting of no less than one and no more than eleven directors. The number of directors is currently fixed at five. If elected the five directors will be elected at the Meeting. Each director so elected will servehold office for a one-year term until the next Annual Meetingannual meeting of Stockholdersstockholders and until his or her successor is duly elected and qualifies. As a resultqualified.
Based on the recommendation of the Amendment to the Company’s Articles of Incorporation adopted at the last Annual Meeting of Stockholders on December 12, 2006, the maximum number of directors is eleven, with the exact number to be determined by the Board. As indicated in the section ‘‘Nominating Committee’’ under this caption ‘‘Proposal One: Election of Directors’’ later in this Proxy Statement, the Nominating Committee, recommended,we have nominated Ronald J. Ricciardi, Donald Hecht, Jeffrey B. Mendell, Alvin S. Trenk, and William B. Wachtel, all of whom are currently serving as directors. We recommend the Board approved, thatelection of the numberfive nominees named in this proxy statement, and unless authority to vote for one or more of directors remain at nine at least for this Meeting.the nominees is specifically withheld according to the instructions on your proxy card, proxies in the enclosed form will be voted FOR the election of Messrs. Ricciardi, Hecht, Mendell, Trenk, and Wachtel. Proxies received in response to this solicitation, unless specified otherwise, will be voted on a non-cumulative basis, in favor of the ninefive nominees named below, all of whom are currently serving as directorsdirectors. We do not contemplate that any of the Company. Ifnominees will be unable to serve as a director, but if a nominee should not be available for election as contemplated, the management proxy holders will vote for such lesser number of directors as are available to serve or will vote for a substitute designatedappointed by the Nominating Committee of the current Board of Directors and then approved by the Board.Directors. In no event will proxies be voted for more than ninefive nominees.
Table of ContentsThe next following table sets forth certain information, as of the Record Date,record date, concerning the nominees for election as directors of the Company.directors. The information as to age has been furnished to the Companyus by the individual named.each director nominee. For information as to the shares of the Common Stockour common stock beneficially owned by each nominee, your attention is directed toplease review the table under the caption ‘‘Security“Security Ownership of Certain Beneficial Holders and Management’’ subsequentlyManagement” in this Proxy Statement. Each of the foregoing nominees for election as a director at the Meeting was re-elected as a director at the last Annual Meeting of Stockholders held on December 12, 2006.
Family Relationships
There are no family relationships among the nominees for election as directors and the executive officers of the Company.
Business History of Director Nominees William B. Wachtel
Ronald J. Ricciardi – Director, Chairman of the Board, Mr. Wachtel was first elected as a director of the Company and its Chairman of the Board on March 31, 2005.
Mr. Wachtel has been a managing partner of Wachtel President & Masyr, LLP, or its predecessor law firm (Gold & Wachtel, LLP), since its founding in August 1984. Such firm furnishes legal services to the Company. He is a co-founder of the Drum Major Institute, an organization carrying forth the legacy of the late Reverend Martin Luther King, Jr.
Ronald J. Ricciardi – Director, Vice Chairman of the Board
Chief Executive Officer
Mr. Ricciardi co-founded a proprietorship named FBO Air on January 17, 2003, which was subsequently incorporated as FBO Air, Inc. on January 2, 2004 in the State of Arizona. This Arizona corporation was merged with and into the Company,FirstFlight, Inc., a public ‘‘shell’’ then named Shadows Bend Development, Inc., in a reverse merger transaction on August 20, 2004. Simultaneously with the reverse merger transaction, Mr. Ricciardi was elected as theour President, and a director of the Company and designated as its Chief Executive Officer.Officer and director and served in such capacities until December 12, 2006. On December 12, 2006, he was elected as Vice Chairman of the Board.Board of Directors. On March 2, 2009, after completion of our divestiture of Airborne, Inc., Mr. Ricciardi was elected as our President and Chief Executive Officer and in April 2009 he was appointed Chairman of the Board of Directors. Before joining FBO Air, the Arizona proprietorship, Mr. Ricciardi was President and CEOChief Executive Officer of P&A Capital Partners, Inc., an entertainment finance company established to fund the distribution of independent films. Mr. Ricciardi was also co-founder, Chairman and CEOChief Executive Officer of eTurn, Inc., a high technology service provider, for which he developed a consolidation strategy, negotiated potential merger/acquisition candidates, prepared private placement materials and executed numerous private, institutional and venture capital presentations. After a management career at Pepsi-Cola Company and the Perrier Group of America, Mr. Ricciardi wasalso served as President and CEOChief Executive Officer of Clearidge, Inc., a leading regional consumer productsproduct company, where he provided strategic and organizational development, and led a consolidation effort that included 14 transactions, which more than tripled company revenue over four years.
Prior to this, Mr. Ricciardi held management positions at Pepsi-Cola Company and the Perrier Group of America,
Table of ContentsJohn H. Dow
William B. Wachtel – President and Chief Executive Officer, Director Mr. DowWachtel was first elected as a director in 2005. Mr. Wachtel served as Chairman of the Company effective September 23, 2005Board of Directors until April 2009, when Airborne, Inc. (‘‘Airborne’’)he was acquiredsucceeded by Mr. Ricciardi. Mr. Wachtel has been a managing partner of Wachtel & Masyr, LLP, or its predecessor law firm (Gold & Wachtel, LLP), since its founding in August 1984. Such firm serves as a subsidiary of the Company. He was designated as President of the Charter Division of the Company on that date and as President of the FBO Division of the Company on September 25, 2006. He was elected President of the Company on December 12, 2006 and designated as the Chief Executive Officer on the same date.Mr. Dow formed Airborne d/b/a FirstFlight Management in 1987, shortly after he acquired B & F Brake and Wheel Service. In 1989, he expanded FirstFlight’s services by adding a charter brokerage division to its management, charter and aircraft sales capabilities. In 1992, FirstFlight successfully developed and received worldwide Part 135 Certification from the Federal Aviation Agency. Mr. Dow is a licensed pilot with an Air Transport Type rating in Gulfstream aircraft.our corporate counsel. He is a memberco-founder of the National Business Aviation Association Operations Committee as well asDrum Major Institute, an organization carrying forth the National Air Transport Association and served on the aviation committee for the Elmira/Corning Regional Airport.
William R. Colaianni – Director
Mr. Colaianni was first elected as a directorlegacy of the Company on September 30, 2004.
Mr. Colaianni is currently a member of Holding Capital Group LLC (‘‘Holding Capital’’), a private investment banking firm that invests in smaller middle market private companies. Holding Capital has been in business for over 25 years and has made investments in over 300 transactions. Mr. Colaianni joined the firm in 1983. Structuring and financing of unique transactions is Holding Capital’s expertise. Mr. Colaianni also sits on the board of directors for seven privately-held companies and is the President of a $35 million veneer and plywood company in Georgia.
Prior to joining Holding Capital, Mr. Colaianni was Chief Operating Officer of Adidas Sports and Leisure, and was President of Pony Footwear. He was also a Vice President for Bankers Trust Company, New York, in charge of asset based lending. Before beginning his professional career, Mr. Colaianni served as a captain in the US Army.
late Reverend Martin Luther King, Jr.
Mr. Hecht was first elected as a director of the Company effectivein September 15, 2006.2006, and has served in that capacity since then. Mr. Hecht has, since 1966, been a managing partner of Hecht Andand Company, P.C., a certified public accounting firm. He haspreviously served on the boardsboard of directors of other public companies. Thomas Iovino – Director
Mr. Iovino was first elected as a director of the Company effective September 15, 2006.
Mr. Iovino has, since 1983, managed his own private contracting firm Judlaw Contracting, Inc. which firm had revenues approximating $257 million in 2007. He serves on the Board of Trustees of Rensselaer Polytechnic Institute, where he received his BS and Masters degrees in Civil Engineering.
Jeffrey B. Mendell –- Director
Mr. Mendell was first elected as a director of the Company onin September 30, 2004. Mr. Mendell is, and has been since 1983, the Chairman & CEOChief Executive Officer of JBM Realty, a private real estate company headquartered in Greenwich, CT. This companyConnecticut. JBM is active in the development, financing and sale of residential and commercial properties. His most recent project was the development of Greenwich Shore, a luxury rental apartment project overlooking Long Island Sound in Greenwich, CT. EarlierEarly in his career, Mr. Mendell was an executive with Citicorp Real Estate, Inc. in New York City and he is a licensed real estate broker in the State of New York.
Table of ContentsStephen B. Siegel – Director
Mr. Siegel was first elected as a director of the Company effective September 15, 2006.
He currently serves as Chairman of Global Brokerage Services of CB Richard Ellis (‘‘CBRE’’), a worldwide premier full service real estate company. He was Chairman and Chief Executive Officer of Insignia/ESG, Inc., a premier commercial real estate company, from 1992 until its merger in July 2003 into CBRE. He serves on many charitable boards of trustees, including serving with his wife Wendy as Co-Chairs of the Council of National Trustees of the National Jewish Medical and Research Center.
Alvin S. Trenk –- Director
Mr. Trenk was first elected as a director and thein August 2004. He also served as Chairman of the Board of the Company effective with the reverse merger transaction onDirectors from August 20, 2004 in which the Arizona FBO Air Inc.to 2005, when he was merged into the Company. He resigned as the Chairman of the Board on March 31, 2005.succeeded by Mr. Wachtel. Mr. Trenk has served as Chairman and CEOChief Executive Officer of Air Pegasus since 1981 and, from 1997 to 2003, as Chairman, President and CEOChief Executive Officer of Sightseeing Tours of America, Inc. and Liberty Helicopters, Inc., privately held corporations operating public use heliports in New York and providing helicopter air tours and charter and air services. Mr. Trenk has also been Chairman and CEOChief Executive Officer of TechTron, Inc. since 1980. TechTron is a privately owned holding company with investment emphasis on emerging global market opportunities. From 1976 to 1980, Mr. Trenk was Vice Chairman of Kenton Corporation, a diversified publicly-traded corporation, where he also served as President and CEOChief Executive Officer of Charles Town Turf Club, the owner and operator of thoroughbred race tracks in West Virginia, and Chairman and CEOChief Executive Officer of International Health Company, which owned and operated a national chain of artificial kidney centers. Other Directorships
Stephen P. Siegel is
Fees Paid to Independent Registered Public Accounting Firm Marcum & Kliegman LLP served as our independent registered public accounting firm for our fiscal year ended December 31, 2008. The Audit Committee has selected Marcum & Kliegman LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2009. We have been advised by Marcum & Kliegman LLP that it will have a trusteerepresentative present at the annual meeting and will be available to respond to appropriate questions. We intend to give such representative an opportunity to make a statement if he or she should so desire.
Audit Fees. The aggregate fees billed for professional services rendered by Marcum & Kliegman LLP were approximately $160,000 and $165,000, respectively, for the audits of Liberty Property Trust, a real estate investment trust traded onour annual financial statements for the NYSE.No other nominee for election as a directorfiscal years ended December 31, 2008 and 2007, respectively, and the reviews of the Company servesfinancial statements included in our Form 10-Qs and registration statements for those fiscal years.
Audit-Related Fees. No fees were incurred by Marcum & Kliegman LLP for professional services categorized as Audit-Related services for the fiscal years ended December 31, 2008 and 2007. Tax Fees. No fees were incurred by Marcum & Kliegman LLP for tax compliance services for the fiscal years ended December 31, 2008 and 2007. All Other Fees. Other than the services described above, no fees were billed for services rendered by Marcum & Kliegman LLP for the fiscal years ended December 31, 2008 and 2007.
REPORT OF THE AUDIT COMMITTEE1
The Audit Committee of the Board of Directors is currently comprised of one member of the Board of Directors, who the Board of Directors has determined is independent under the independence standards of NASDAQ Stock Market and applicable Securities and Exchange Commission rules. The Audit Committee assists the Board of Directors in overseeing our accounting and financial reporting processes and financial statement audits. The specific duties and responsibilities of the Audit Committee are set forth in the Audit Committee charter, a directorcopy of which is available on our website at www.fflt.com under the “Investor Relations” menu. The Audit Committee has: | · | reviewed and discussed our audited consolidated financial statements for the fiscal year ended December 31, 2008 with our management and our independent registered public accounting firm; |
| · | discussed with Marcum & Kliegman LLP, our independent registered public accounting firm, the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1, AU section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T; and |
| · | received and discussed the written disclosures and the letter from Marcum & Kliegman LLP required by applicable requirements of the Public Company Oversight Board regarding Marcum & Kliegman LLP’s communications with the audit committee concerning independence, and has discussed with Marcum & Kliegman its independence. |
Based on these reviews and discussions with management and our independent registered public accounting firm, and the report of the independent registered public accounting firm, the Audit Committee recommended to the Board of Directors, and the Board of Directors approved, that the audited consolidated financial statements for the fiscal year ended December 31, 2008 be included in our annual report on Form 10-K for the fiscal year ended December 31, 2008 for filing with the Securities and Exchange Commission. The Audit Committee selects our independent registered public accounting firm annually and has submitted the selection of Marcum & Kliegman LLP for ratification by stockholders at our annual meeting. | Respectfully submitted,
Donald Hecht, Chair of Audit Committee Jeffrey B. Mendell Ronald J. Ricciardi |
1 The material in this report is not deemed to be “soliciting material,” or to be “filed” with the Securities and Exchange Commission and is not to be incorporated by reference in any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filings. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE During the fiscal year ended December 31, 2008, all of our directors and executive officers complied in a companytimely manner with a classthe filing requirements of securities registered pursuant to Section 1216(a) of the Securities Exchange Act of 1934, as amended, (the ‘‘Exchange Act’), or subject toexcept that Mr. Bleier, a former executive officer, filed one late report disclosing one transaction. In making this statement, we relied solely on the requirementswritten representations of Section 15(d)our directors and executive officers and copies of the reports that they have filed with the Securities and Exchange Act, or any company registered as an investment company under the Investment Company Act of 1940, as amended.Compliance with Section 16(a)Commission.
CORPORATE GOVERNANCE
Meetings of the Exchange ActBased solely on a reviewBoard of Forms 3 and 4 and amendments thereto furnished to the CompanyDirectors
The Board of Directors held four meetings during the fiscal year ended December 31, 2007 (‘‘fiscal 2007’’) and Forms 5 and amendments thereto furnished to the Company with respect to fiscal 2007, each2008. Each director and executive officerthen in office attended at least 75% of the Company timely reported alltotal of his transactions during that most recent fiscal year as required by Section 16(a)such board meetings and meetings of the Exchange Act except that, due to a delay in finalizing stock option agreements after Compensation Committee grants, William B. Wachtel, a director (also Chairman of the Board) and a 10% stockholder, did not report an option grant to non-employee directorsboard committees on December 1, 2007 until later in that month on a Form 4 and each of the other such directors (Messrs. Colaianni, Hecht, Iovino, Siegel and Trenk) timely reported his option grant in a Form 5. In addition, because of the same delay, the executive officers (Messrs. Dow and Bleier) each timely reported an option grant to him in September 2007 on Form 5. The Company and its corporate counsel have instituted actions intended to facilitate timely filings on Form 4 in the future, rather than waiting for the Form 5.which he served. Director Independence
Table of ContentsDirector Independence
In determining who of the nine nominees for election as directors, all of whom are currently serving the Company as directors, are independent, theThe Board of Directors uses the definitionsindependence standards of The Nasdaqthe NASDAQ Stock Market Inc. (‘‘Nasdaq’’)and applicable Securities and Exchange Commission rules for determining who is an independent director and who is an independent memberwhich directors are deemed independent. The Board of a specified board committee.
Using the Nasdaq definition, the BoardDirectors has determined that only William R. Colaianni, Donald Hecht Thomas Iovino,and Jeffrey B. Mendell and Stephen B. Siegel arequalify as independent so that a majority of the Board is independent. In making its determination aspursuant to the independence of such five directors, the Board did not consider any transactions, relationships or arrangements of such five directors with the Company or any subsidiary thereof because there were none other than the compensation arrangements for services applicable to them generally. Your attention is directed to the section ‘‘Directors’ Compensation’’ under the caption ‘‘Executive Compensation’’ later in this Proxy Statement.
The reasons why the Board concluded that the other four nominees for election are not independent directors are summarized in the following three paragraphs:
John H. Dow and Ronald J. Ricciardi are employees of the Company and also serve as President and Chief Executive Officer and Vice Chairman of the Board, respectively.
William B. Wachtel, the Chairman of the Board, is a managing partner of Wachtel & Masyr, LLP, which law firm furnishes legal services to the Company and its subsidiaries. For information as to the fees paid to this law firm in the last fiscal year, your attention is directed to the section ‘‘Certain Relationships and Related Transactions’’ under this caption ‘‘Proposal One: Election of Directors’’ later in this Proxy Statement. In addition, on September 23, 2005, the Company issued a note payable to a holder, for which Mr. Wachtel and an entity owned by Alvin S. Trenk, another director, are members of the entity which is the holder. This note payable had a face value of $1,500,000 and, for the initial period of 180 days, bore an annual interest rate of 4.25%. Effective March 22, 2006, the initial maturity date, the Company had elected to extend the maturity to September 23, 2006 wi th an interest rate of 9.25% per annum applicable to the extended period. The Company used the proceeds from the loan as part of the purchase price to acquire Airborne, the charter management subsidiary, on September 23, 2005. Airborne granted the holder a security interest in its accounts receivable, all of its deposit accounts, all monies then and thereafter in the possession or under the control of Airborne or the Company and all products and proceeds of the foregoing personal property. The Company also granted the entity a warrant expiring September 22, 2010 to purchase 1,200,000 shares at $.60 per share. This note has been prepaid and the security interest terminated. Mr. Wachtel may exercise the foregoing warrant as to 800,000 shares of the Common Stock.
Alvin S. Trenk was not deemed an independent director under the Nasdaq definition because less than three years have elapsed since his son, a co-founder of the Arizona FBO Air, resigned as a director and an executive officer of the Company. In addition, the Board noted Mr. Trenk’s participation in the loan transaction described in the preceding paragraph. Mr. Trenk’s entity may exercise the warrant received in this loan transaction as to 400,000 shares of the Common Stock.
these standards.
Committees of the Board of DirectorsThere are three standing Committees
The Board of Directors has established, among other committees, an Audit Committee, a Nominating Committee and a Compensation Committee. The Audit Committee acts pursuant to a written charter adopted by the Board of Directors:Directors. The current Audit Committee charter is available on our website, www.fflt.com under the “Investor Relations” menu. In addition, a stockholder may receive a written copy of the Audit Committee comprised of William R. Colaianni, Chairman, Donald Hecht and Thomas Iovino; thecharter by sending a written request to FirstFlight, Inc., 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary or by telephone at (570) 457-3400. The Compensation Committee comprised of Jeffrey B. Mendell, Chairman, Stephen B. Siegel and Alvin S. Trenk; and the Nominating Committee comprised of Stephen B. Siegel, Chairman, Thomas Iovino and Jeffrey B. Mendell. Of the foregoingdo not have written charters.
Audit Committee Members, as indicated in the preceding section ‘‘Director Independence,’’ only Mr. Trenk would not qualify as independent under the Nasdaq definition. Accordingly, all The current members of the Audit Committee are Messrs. Hecht, Mendell and Nominating CommitteeRicciardi. As discussed above, the Board of Directors has determined that Messrs. Hecht and Mendell are independent pursuant to the independence standards of NASDAQ Stock Market and a majorityapplicable Securities and Exchange Commission rules. The Board of theDirectors has determined that Messrs. Hecht, Mendell and Ricciardi have sufficient knowledge in financial and auditing matters to serve as members of the Compensation Committee are independent under the Nasdaq definition.
audit committee. The Board of Directors has designated Mr. Hecht as an “audit committee financial expert” in accordance with applicable Securities and Exchange Commission rules.
Table of ContentsBoard and Committee Meetings
During fiscal 2007 the Board held three meetings, which were attended by all of the directors except Stephen B. Siegel who, because of business commitments, did not attend any.
During fiscal 2007, the
The Audit Committee held no formal meetings. However,serves as an independent and objective party to monitor our financial reporting process and internal control system; retains, pre-approves audit and permitted non-audit services to be performed by, and directly consults with, our independent registered public accounting firm; reviews and appraises the Audit Committee Charter, the Chairmanservices of the Audit Committee (William R. Colaianni) metour independent registered public accounting firm; and provides an open avenue of communication with the Company’sour independent registered public accounting firm, (Marcum & Kliegman LLP)management and executive officersthe Board of Directors. Our Audit Committee charter more specifically sets forth the duties and responsibilities of the CompanyAudit Committee. The Audit Committee is also responsible for preparing the Audit Committee Report that Securities and Exchange Commission rules require be included in our annual proxy statement, and performing such other tasks that are consistent with its charter. The Audit Committee held four meetings during 2008. The Audit Committee’s report relating to review (1) the audited financial statements for the fiscal year ended December 31, 2006 (‘‘fiscal 2006’’) and (2) the unaudited quarterly financial statements for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007. He was joined by Donald Hecht, a member2008 appears on page 9 of the Auditthis proxy statement.
Nominating Committee for the quarterly reviews. For information as to certain of the topics covered at these review sessions, your attention is directed to the section ‘‘Audit Committee’’ under this caption ‘‘Proposal One: Election of Directors’’ later in this Pr oxy Statement. Following these review sessions, the Chairman reported to the other member or members in attendance (Mr. Hecht for the annual review session and Thomas Iovino for all four review sessions) and the three The current members of the AuditNominating Committee then unanimously recommendedare Messrs. Hecht, Mendell and Ricciardi. As discussed above, the Board of Directors has determined that Messrs. Hecht and Mendell are independent pursuant to the Board that the audited financial statements be included in the Annual Report on Form 10-KSB for fiscal 2006 and the unaudited financial statements in the Quarterly Reports on Form 10-QSB for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007.The Compensation Committee held no meetings during the fiscal 2007 but acted by unanimous consent on two occasions. The Nominating Committee held no meetings during fiscal 2007 because there were no Board vacancies to fill, because it received no recommendations from stockholders as to nominees for election as directors and because there was no stockholder meeting to be scheduled.
In connection with authorizing the call of this Annual Meeting, the Board adopted a policy that all directors, or nominees for election as directors whether or not they are then directors, should attend Annual Meetings of Stockholders if reasonably possible. There was no Annual Meeting of Stockholders held in 2007 and at the Annual Meeting held on December 12, 2006 eightindependence standards of the nine directors attended such Meeting.
Nominating Committee
NASDAQ Stock Market and applicable Securities and Exchange Commission rules. The Nominating Committee does not have a formal charter;written charter, however, the Board resolutions establishing such Committeeof Directors, by resolution, granted authority to the Nominating Committee to act on certain matters as set forth in the third succeeding paragraph.On April 3, 2008, thedescribed herein.
The Nominating Committee formalized its previously announced policyis charged with regardidentifying qualified candidates, consistent with criteria approved by the committee, to the consideration of any director candidate recommended by one or more of the Company’s stockholders. Under such policy, the Nominating Committee will consider such a candidate if the stockholder or stockholders shall make his, her, its or their recommendation in writing addressed to the Chairman of the Nominating Committee (currently Stephen B. Siegel) at the Company’s address shown in the heading to this Proxy Statement. Becausebecome directors and recommending that the Board intends to hold future Annual Meetings of Stockholders in the month of June, commencing in 2009, if the stockholder wishes a candidate to be consideredDirectors nominate such qualified candidates for election at such an Annual Meeting, the Nominating Committee requests that any such recommendation be made before April 1st of the year so that adequate consideration can be given to such recommendation. Nominations for the Board to fill a vacancy other than at an Annual Meeting of Stockholders will be consideredas directors. The process followed by the Nominating Committee at any time. Any recommendation for a nominee by a stockholder should give the business history and other biographical information as to the proposed nominee and the reasons for suggesting such person as a director of the Company. The Nominating Committee will then promptly review the recommendation and advise the stockholder of its conclusions and, if a rejection, the reasons therefor. Minimum qualifications for consideration include that the candidate is independent within the definition used by Nasdaq, not only for service as a director, but also for possible service on one of the three standing committees of the Board, i.e., the Audit Committee, the Compensation Committee and the Nominating Committee, and that he or she is not engaged in any business or owns securities in any entity that would create a conflict with the Company and its subsidiaries. It is the Nominating
Table of ContentsCommittee’s current intention, consistent with the Board’s policy, that at least a majority of the directors qualify as independent within the Nasdaq definition and also that the person then serving as the Chief Executive Officer of the Company serve as a director.
As of the date of this Proxy Statement, the Nominating Committee has received no recommendation from any stockholder as to a nominee for election as a director of the Company, whether at this Meeting or otherwise. In addition, all the current directors were first elected as a result of one of the following reasons: (1) he was a co-founder of the Company (i.e., Ronald J. Ricciardi), (2) it was a condition of an acquisition by the Company (i.e., John H. Dow), or (3) he was recommended for election by a then non-management director (i.e., the remaining seven directors). Accordingly, there has been no need for the Nominating Committee (which was first authorized as a standing committee in December 2005) to create a process for identifying and evaluating nominees for election as directors, including nominees recommended by a security holder of the Company (as to which there have been none as indicated above). Because of the Nominating Committee’s recommendation, and the Board’s decision, that the number of directors remain nine and that the nine incumbents be nominated for re-election at this Meeting, there was no need to develop a process to identify and evaluate new nominees in connection with this Meeting. The Nominating Committee has, however, agreed that, should a vacancy develop on the Board in the future, whether because the Board electscandidates includes requests to increase the numberour directors, our chief executive officer, and others for recommendations, evaluating biographical information and background material relating to potential candidates and their qualifications, and interviews of directors or otherwise, there will be no difference in the manner in which the Nominating Committee will evaluate a nominee for election as a director based on whether the nominee is recommend ed by a holder of the Common Stock or other then outstanding security of the Company.
selected candidates. In addition to its authority to recommend nominees for election or re-election as directors, of the Company, the Board in its resolutions creating the Nominating Committee as a standing committee of the Board, gaveDirectors granted the Nominating Committee authority to make recommendations to the Board of Directors as to the following subjects: (1)follows: (i) the criteria regarding the composition of the committees of the Board committees,Directors, such as size, employee and non-employee director membership thereon and the periodic rotation of committee assignments; (2)(ii) the criteria relating to tenure as a director, such as retirement age, limitations on the number of times a director may stand for re-election and the continuation of directors in an honorary or similar capacity; (3)(iii) the criteria for retention of directors, unrelated to age or tenure, such as attendance at Board of Director and Board committee meetings, health or the assumption of responsibilities which are incompatible with effective Boardboard membership; (4)(iv) the specific amounts of directors’ retainers and meeting fees; (5)(v) the removal of a director under unusual circumstances; (6)(vi) the selection of committee chairpersons, and the actual assignments of individual directors (by name) to various Board committees; (7)committee assignments; (vii) the types and functions of the committees of the Board committees;of Directors; and (8)(viii) the procedures, frequency and location of meetings of the Board.AuditBoard of Directors.
The Nominating Committee The Audit Committee has a written charter adopted by also considers recommendations for nomination to the Board of Directors on December 13, 2005. A copy of the Audit Committee Charter is available on the Company’s website, www.FFLT.com. In addition, a copy of the Charter willsubmitted by stockholders. Such recommendations for nomination, together with relevant biographical information, should be made available upon request by any stockholder madesent to Ronald J. Ricciardi, the Vice Chairman of the Board of the Company, at the following Company address: 100FirstFlight, Inc., 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, PAPennsylvania 18641, or telephone: (570) 457-3400. The Board also adopted a Code of Ethics for the Company and its subsidiaries on May 19, 2006 and a Policy and Procedure Governing Related Party Transactions on April 26, 2007, which policy delegates certain functions to the Audit Committee and the Compensation Committee. A stockholder may receive, upon a written request to Mr. Ricciardi as described above, a copyAttention: Chairman of the CodeNominating Committee. The qualifications of Ethics andrecommended candidates will be reviewed by the Related Party Policy and Procedure.
Nominating Committee.
Table of ContentsThe Audit Committee has submittedIf the following report datedstockholder desires that a candidate be considered for election at an annual meeting, such recommendation must be made before April 3, 2008 to the other members1st of the Boardyear so that adequate consideration can be given to such recommendation. Nominations to fill a vacancy other than at an annual meeting will be considered by the Nominating Committee at any time.
In evaluating the suitability of Directors:‘‘Having orally reportedcandidates (other than our executive officers) to the other members ofserve on the Board of Directors, of FirstFlight, Inc. (the ‘‘Company’’)including stockholder nominees, the matters hereinafter mentionedNominating Committee generally seeks candidates who are independent and meet other selection criteria established by the Nominating Committee from time to time. The Nominating Committee also considers an individual’s skills, character and professional ethics, judgment, leadership experience, business experience and acumen, familiarity with relevant industry issues, national and international experience, and other relevant criteria that may contribute to our success. This evaluation is performed in this Report prior to the filinglight of the Company’s Annual Report on Form 10-K on March 31, 2008, the Audit Committee now confirms in writing these matters:
(1) The Audit Committee had reviewedskill set and discussed with management the audited consolidated financial statementsother characteristics that would most complement those of the Company forcurrent directors, including the fiscal year ended December 31, 2007 (‘‘fiscal 2007’’).
(2) diversity, maturity, skills and experience of the board as a whole.
The AuditNominating Committee had discussed with Marcum & Kliegman LLP,held no meetings during 2008. Compensation Committee The current members of the independent registered public accounting firm for the Company, the matters required to be discussed by the statement on Auditing Standards No. 61, as amended, as adopted by the Public Company Accounting Oversight Board in Rule 3200T.(3)Compensation Committee are Mr. Mendell and Mr. Trenk. The Audit Committee had received the written disclosures and the letter from Marcum & Kliegman LLP required by Independence Standard Board Standard No. 1, Independence Discussion with Audit Committee, as adopted by the Public Company Accounting Oversight Board in Rule 3600T, and had discussed with Marcum & Kliegman LLP such firm’s independence.
(4) Based on the review and discussions referred to in paragraphs (1) through (3), the Audit Committee had recommended to the Board of Directors has determined that Mr. Mendell is and Mr. Trenk is not independent pursuant to the audited consolidated financial statements for fiscal 2007 be included inindependence standards of the Company’s Report on Form 10-K for fiscal 2007 for filing with theNASDAQ Stock Market and applicable Securities and Exchange Commission.
| | | | | | | Respectfully submitted, | | | | | | | | William R. Colaianni, Chairman
Donald Hecht, Member
Thomas Iovino, Member’’ |
Table of ContentsCompensation Committee
The Compensation Committee does not have a Charter. Informal written charter, however, the resolutions creatingBoard of Directors, by resolution, granted authority to the Compensation Committee as a standing committeeto act on certain matters described herein. The Board of the Board, the BoardDirectors has delegated the following authority to the Compensation Committee: (1)(i) review and, where appropriate, formulate or recommend changes to the Company’sour stock benefit and executive, managerial or employee compensatory and benefit plans or programs, provided that the authority to adopt or change any compensatory or benefit plan or program shallwill rest with theour Board of Directors of the Company (unless specifically delegated to the Compensation Committee); (2)(ii) administer, and act as the designated committee under, any stock option, restricted stock, stock purchase or similar plan of the Company;plan; and (3)(iii) approve the base salary, bonus or other compensation arrangements of our existing or prospective officersofficers.
The Compensation Committee is responsible for establishing and implementing compensation programs for our executives and directors that further the intent and purpose of our fundamental compensation philosophy and objectives, and performing such other tasks that are consistent with the Company or any subsidiary thereof.compensation committee charter. Because of the small size of the Companyour company and the limited number of executive officers, the Compensation Committee has to date relied on the recommendations of the Chief Executive Officer (currently John H. Dow and, on or prior to December 12, 2006, Ronald J. Ricciardi) and the Vice Chairman of the Board (since December 12, 2006, Mr. Ricciardi)our chief executive officer in determining the amount and form of executive and director compensation. The Compensation Committee has not used compensation consultants in determining or recommending the amount or form of executive and director compensation. Now that the Company is growing and operating at a profit, the The Compensation Committee intendsheld three meetings during 2008.
Director Attendance at Annual Meetings Our policy is that all directors, absent special circumstances, should attend our annual stockholder meetings. All of our directors then in office attended the balance2008 annual meeting of 2008, working with the aforementioned two executivestockholders. Code of Ethics and Policy and Procedure Governing Related Party Transactions The Board of Directors adopted a Code of Ethics on May 19, 2006, that is applicable to all of our directors, officers and corporate counsel to the Company, to review and, if deemed appropriate, develop new processes and procedures for the consideration and determination ofemployees, including our principal executive and director compensation.Communications with Stockholders
The Board has been exploring with management and, effective January 1, 2008, with an investment relations firm means of improving the Company’s lines of communications with its stockholders. As a part of that process, the Company has expanded the information relating to the Company available on its website, www.FFLT.com, including copies of the periodic reports which the Company files pursuant to the Exchange Act.officer. In addition, the Board of Directors has establishedadopted a Policy and Procedure Governing Related Party Transactions on April 26, 2007. Both the following process forCode of Ethics and the Policy and Procedure Governing Related Party Transactions delegate certain functions to the Audit Committee and the Compensation Committee. The Code of Ethics is available on our website, www.fflt.com, under the “Investor Relations” menu. A stockholder may receive a stockholderwritten copy of the Code of Ethics or the Related Party Policy and Procedure by forwarding a written request to communicate with directorsFirstFlight, Inc., 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary or a director: Any letter which a stockholder wishesby telephone at (570) 457-3400.
Stockholder Communications Stockholders may send correspondence by mail to sendthe full Board of Directors or to individual directors. Stockholders should address any such correspondence to the Board generally should be sentof Directors or to the attention of the relevant board members in care of FirstFlight, Inc., 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary. All stockholder correspondence will be compiled and forwarded as appropriate. In general, correspondence relating to corporate governance issues, long-term corporate strategy or similar substantive matters will be forwarded to the Board of Directors, one of the aforementioned committees of the Board of Directors, or a member thereof for review. Correspondence relating to the ordinary course of business affairs, personal grievances, and matters as to which we tend to receive repetitive or duplicative communications are usually more appropriately addressed by our executive officer or his designees and will be forwarded to such persons accordingly. EXECUTIVE OFFICERS
Current Executive Officers
Our only current executive officer is Ronald J. Ricciardi, who serves as our Chairman of the Board at the Company’s address shown in the heading to this Proxy Statement. Similarly, if a stockholder wishes to communicate with an individual director, the stockholder should address such letter to the director at the Company’s address. Any such letter will then be deli vered to the respective addressee or addresses.Certain Relationships and Related Transactions
The firm of Wachtel & Masyr, LLP furnishes legal services to the Company. William B. Wachtel, FirstFlight’s Chairman of the Board, is a managing partner of this firm. During fiscal 2007, the Company was billed for legal services of $165,156. At December 31, 2007, the Company has recorded in accounts payable an obligation for legal fees of $374,517 related to these legal services.
The charter division of the Company manages several aircraft owned by an entity in which Mr. Wachtel along with two other directors of the Company, Thomas Iovino and Stephen B. Siegel, are members. During fiscal 2007, the Company recorded direct revenue and expenses of $6,809,903 and $5,944,582, respectively, related to the Company’s management of these aircraft. At December 31, 2007 the Company had recorded in accounts receivable a balance of approximately $172,621 owed from this entity.
On April 26, 2007, Airborne entered into an agreement to lease an aircraft from a company, of which one of its members is John H. Dow, a director and the currentDirectors, President and Chief Executive Officer of the Company, and the other member is an employee of its charter segment. The terms of the lease provide for the payment of rent of $20,000 per month and a charge of $500 for each hour of
Table of Contentsaircraft use. The lease agreement, which is for a period of one year, further provides that this aircraft will be managed by the Company through its charter segment, and through which the Company will retain 90% of the associated charter revenue. The Company made use of this aircraft for certain business travel needs and paid these expenses to the lessor. During fiscal 2007, the Company recorded revenue of $391,976 and expenses of $493,228 in conjunction with the lease of this aircraft. This agreement replaced a prior arrangement which was terminated in February 2007.
Executive Officers
Current Executive Officers
The following table contains certain information relating to the executive officers of the Company as of the Record Date:
| | | | | | | Name | | | Age | | | Position | John H. Dow | | | 53 | | | President and Chief Executive Officer of the Company | Ronald J. Ricciardi | | | 46 | | | Vice Chairman of the Board | Keith P. Bleier | | | 38 | | | Senior Vice President and Chief Financial and
Accounting Officer |
Each executive officer is elected by the Board of Directors to serveOfficer. Mr. Ricciardi serves at the discretion of the Board.
Business Mr. Ricciardi’s business experience is outlined in the section entitled “Business History of Executive Officers
For information as toDirector Nominees” under the business histories of Messrs. Dow and Ricciardi, your attention is directed to the section ‘‘Business History of Nominees’’ under this caption ‘‘Proposal“Proposal One: Election of Directors’’ earlier inDirectors” on page 5 of this Proxy Statement.
Keith P. Bleier – Senior Vice President, Chief Financial
COMPENSATION OF NAMED EXECUTIVE OFFICERS AND DIRECTORS Named Executive Officers This proxy statement contains information about the compensation paid to our named executive officers during fiscal year 2008. For fiscal year 2008, in accordance with the rules and Chief Accounting OfficerMr. Bleier was elected as a Senior Vice Presidentregulations of the Company,Securities and designated as its Chief Financial Officer, effective September 15, 2006. Mr. Bleier was designated as Chief Accounting Officer on December 12, 2006.
Prior to his engagement byExchange Commission, we determined that the Company and commencing in September 2002, Mr. Bleier, who is a certified public accountant, served as a Principalfollowing officers were our named executive officers for purposes of the Business Advisory Group of Bonadio & Co. LLP, a certified public accounting firm. While serving in such capacity, among his duties was as the engagement manager in that firm’s representation of Airborne, which became a subsidiary of the Company on September 23, 2005. From September 1998 to September 2002, he served as the principal accounting and financial officer of Montana Mills Bread Co., Inc. and its subsidiaries, which company’s common stock was listed on the AMEX prior to its purchase by Krispy Kreme Donut Corp. and which was a specialty retail and wholesale bakery manufacturer.
this proxy statement: | · | John H. Dow, held the titles of President, Chief Executive Officer and Chief Operating Officer during 2008; |
| · | Keith P. Bleier, held the titles of Senior Vice President, Vice President of Finance and Chief Financial Officer and Chief Accounting Officer during 2008; and |
| · | Ronald J. Ricciardi, held the title of Vice Chairman of the Board of Directors during 2008 and now serves as our Chairman of the Board of Directors, President and Chief Executive Officer. |
Summary Compensation Table of ContentsEXECUTIVE COMPENSATION
Compensation of Executive Officers
for Fiscal Year 2008
The following table sets forthshows information regarding the annual and long-term compensation paid to our named executive officers for services rendered in all capacities for fiscal 2007. The following table sets forth the annual compensation paid by the Company for services performed on the Company’s behalf forduring the fiscal 2007 and fiscal 2006 with respect to any person who served as Chief Executive Officer of the Company during fiscal 2007 and the two other most highly compensated executive officers serving atyears ended December 31, 2007 whose total compensation exceeded $100,000 in fiscal2008 and 2007. The three persons named in the table are the only persons who served as executive officers of the Company in fiscal 2007.Summary Compensation Table
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name and Principal Position | | | Year | | | Salary
($)(1) | | | Bonus
($) | | | Option
Awards
($)(2) | | | All Other
Compensation
($)(3) | | | Total
($) | | John H. Dow, President | | | | | 2007 | | | | | | 150,000 | | | | | | 100,000 | | | | | | 99,900 | | | | | | 12,000 | | | | | | 361,900 | | | and Chief Executive Officer(4) | | | | | 2006 | | | | | | 150,000 | | | | | | 100,000 | | | | | | 99,600 | | | | | | 12,000 | | | | | | 361,600 | | | Ronald J. Ricciardi, Vice | | | | | 2007 | | | | | | 125,000 | | | | | | — | | | | | | 97,400 | | | | | | 12,000 | | | | | | 234,400 | | | Chairman of the Board(4) | | | | | 2006 | | | | | | 175,000 | | | | | | — | | | | | | 124,400 | | | | | | 12,000 | | | | | | 311,400 | | | Keith P. Bleier, Senior VP, | | | | | 2007 | | | | | | 188,100 | | | | | | — | | | | | | 82,500 | | | | | | 21,031 | | | | | | 291,631 | | | CFO and CAO | | | | | 2006 | (5) | | | | | 49,850 | | | | | | — | | | | | | 87,000 | | | | | | — | | | | | | 136,850 | |
| Year | Salary ($)(1) | Bonus ($)(1) | Option Awards ($)(2)(3) | All Other Compensation ($)(4) | Total ($) | | | | | | | | Ronald J. Ricciardi, Vice Chairman of the Board | 2008 2007 | 130,417 125,000 | -- -- | -- 97,400 | 26,365 33,895 | 156,782 256,295 | | | | | | | | John H. Dow, President and Chief Executive Officer (5) | 2008 2007 | 150,000 150,000 | 83,333 100,000 | -- 99,600 | 26,365 34,365 | 259,698 383,965 | | | | | | | | Keith P. Bleier, Senior VP, CFO and CAO (6) | 2008 2007 | 191,013 188,100 | -- -- | 72,500 82,500 | 22,765 27,060 | 286,278 297,660 |
| 1. | Before his resignation, effective March 2, 2009, Mr. Dow receivesreceived a base salary of $150,000 and a guaranteed bonus of $100,000; effective November 1, 2008, Mr. Dow agreed to temporarily forego his guaranteed bonus until further notice in connection with a cost-reduction program. Mr. Ricciardi received a base salariessalary of $125,000 and $175,000 in 2007 through October 31, 2008 and 2006, respectively;$175,000. Effective November 1, 2008, Mr. Ricciardi agreed to temporarily forego 10% of his salary until further notice in connection with a cost-reduction program. Before his resignation effective December 31, 2008, Mr. Bleier receivesreceived a base salary of $185,000 with annual increases of 5% effective September 1st of each year. |
| 2. | Mr. Dow received an option to purchase 250,000 shares on September 23, 20072007. The options vested immediately and 2006. Eachwere exercisable for five years from the date of grant. The option was priced at $0.40 per share, the closing sales price of the common stock on September 22, 2007. All such options were forfeited by Mr. Dow as a condition to the consummation of the Airborne divestiture. Mr. Ricciardi received an option to purchase 250,000 shares on April 1, 2007. The option vested immediately and is exercisable for five years from the date of grant. The 2007 and 2006 options wereoption was priced at $0.40$0.39 per share, the closing sales price of the Common Stock on September 22, 2007 and 2006. Mr. Ricciardi received an option to purchase 250,000 sharescommon stock on April 1, 2007 and 2006. Each option was vested immediately and is exercisable for five years from the date of grant. The 2007 option was priced at $0.39 per share and the 2006 option was priced at $0.50 per share, the closing sales price of the Common Stock on April 1, 2007 and 2006, respectively. 2007. Mr. Bleier received an option to purchase 250,000 shares effective September 1, 200715, 2008 and 2006.2007. Each option vests over on eaward vest after one year and isare exercisable for five years from the date of vesting. The 2008 and 2007 option wasoptions were priced at $0.29 and $0.33 per share, the closing sales price of the Common Stockcommon stock on AugustSeptember 14, 2008 and 2007, respectively. Mr. Bleier’s final option (issued September 15, 2008) was forgone upon his resignation effective December 31, 2007. The 20062008. Mr. Bleier’s remaining option was priced at $0.60 per share, a negotiated price.awards expired on March 31, 2009. All options were valued using the Black-Scholes model. |
| | | 3. | These amounts do not reflect actual value realized by the recipient. In accordance with Securities and Exchange Commission rules, the amount in this column for each year represents the portion of stock options granted to our named executive officers, including those made in prior years, which were expensed pursuant to SFAS 123R. See Note 6 to our audited financial statements included in our Annual Reports on Form 10-K for the fiscal years ended December 31, 2008 under the subheading “Stock Based Compensation” and Note 3 to our audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007 under the subheading “Stock Based Compensation” for the assumptions we used in valuing and expensing these stock options in accordance with SFAS 123R. | | | | 4. | Mr. Dow receivesreceived the use of an automobile and related expenses paid by the Company;us; Mr. Ricciardi receives an auto allowance of $1,000 per month and Mr. Bleier receivesreceived an auto allowance of $700 per month. Each of Messrs Dow, Ricciardi and Bleier receive health insurance coverage paid by us estimated at a value of $1,000 per month. Each of Messrs Dow, Ricciardi and Bleier receive life insurance coverage paid by us estimated at a value of $197 per month. We have the option to match employee contributions to our 401k Plan. In 2008 and 2007, Mr. Dow received matching contributions of approximately $4,000. Mr. Ricciardi received matching contributions of approximately $3,500 and $4,100 in 2008 and 2007, respectively. Mr. Bleier received reimbursement for certain expenses associated with his relocation.matching contributions of approximately $4,300 and $0 in 2008 and 2007, respectively. |
4. | Mr. Dow was first designated as the Chief Executive Officer of the Company on December 12, 2006; prior thereto, Mr. Ricciardi served as the Chief Executive Officer of the Company. |
| 5. | Mr. Bleier’s employment agreement becameDow resigned as our President and Chief Executive Officer and as a director effective with the March 2, 2009 divestiture of Airborne, Inc., our former wholly owned subsidiary, which was divested in a share exchange transaction on September 1, 2006.March 2, 2009 (more particularly described below in this proxy statement under the heading “Certain Relationships and Related Person Transactions”). | | | | 6. | Mr. Bleier resigned as our Senior Vice President and Chief Financial Officer effective December 31, 2008. |
Outstanding Equity Awards At Fiscal Year End
The following table shows information regarding the number of unexercised stock options at December 31, 2008. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | OPTION AWARDS | | Name | | | Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)(1) | | | Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) | | | Equity Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)(1) | | | Option
Exercise
Price
($) | | | Option
Expiration
Date | | John H. Dow | | | | | 250,000 | | | | | | | | | | | | | | | | | | 0.40 | | | | | | 09/22/2011 | | | | | | | | 250,000 | | | | | | | | | | | | | | | | | | 0.40 | | | | | | 09/22/2012 | | | Ronald J. Ricciardi | | | | | 250,000 | | | | | | | | | | | | | | | | | | 1.60 | | | | | | 03/31/2010 | | | | | | | | 250,000 | | | | | | | | | | | | | | | | | | 0.50 | | | | | | 03/31/2011 | | | | | | | | 250,000 | | | | | | | | | | | | | | | | | | 0.39 | | | | | | 03/31/2012 | | | Keith P. Bleier | | | | | 250,000 | | | | | | | | | | | | | | | | | | 0.60 | | | | | | 09/01/2012 | | | | | | | | 250,000 | | | | | | 250,000 | | | | | | 250,000 | | | | | | 0.33 | | | | | | 09/01/2013 | |
|
| Name | Number of Securities Underlying Unexercised Options Exercisable (#)(1) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | | | | | | | 250,000 250,000 250,000 | | 1.60 0.50 0.39 | 03/31/2010 03/31/2011 03/31/2012 | | | | | | | John H. Dow | 250,000 250,000 | | 0.40 0.40 | 09/22/2011 09/22/2012 | | | | | | | Keith P. Bleier | 250,000 250,000 250,000 | 250,000 (2) | 0.60 0.33 0.29 | 09/15/2012 09/15/2013 09/15/2014 |
| 1. | As part of his employment agreement, Mr. Dow (a) received on September 23, 2005 an option for 250,000 shares at $0.33 per share, upon which he made a cashless exercise on January 11, 2006 and for which he received 85,000 shares; (b) received on September 23, 2006 an option for 250,000 shares at $0.40 per share, the closing sales price of the Common Stock on September 22, 2006, which is currently exercisable; and (c) received on September 23, 2007 an option for 250,000 shares at $0.40 per share, the closing sales price of the Common Stock on September 22, 2007, which is currently exercisable. |
| As part of his employment agreement, Mr. RicciardiRicciardi: (a) received on April 1, 2005 an option for 250,000 shares at $1.60 per share, the closing sales price of the Common Stockcommon stock on March 31, 2005, which is currently exercisable; (b) received on April 1, 2006 an option for 250,000 shares at $0.50 per share, the closing sales price of the Common Stock on March 31, 2006, which is currently exercisable; and (c) received as of April 1, 2007 an option for 250,000 shares at $0.39 per share, the closing sales price of the Common Stock on March 31, 2007, which is currently exercisable. |
| As part of his employment agreement, Mr. BleierDow: (a) received on September 1,23, 2006 an option for 250,000 shares at $0.40 per share, the closing sales price of the common stock on September 22, 2006, which is currently exercisable; and (b) received on September 23, 2007 an option for 250,000 shares at $0.40 per share, the closing sales price of the common stock on September 22, 2007, which is currently exercisable. All of the previously mentioned options were forfeited by Mr. Dow as a condition to the consummation of our divestiture of Airborne, Inc. As part of his employment agreement, Mr. Bleier: (a) received on September 15, 2006 an option for 250,000 shares at $0.60 per share, a negotiated price, which became exercisable on September 1,15, 2007; (b) received on September 1, 2007 an option for 250,000 shares priced at $0.33 per share, the closing sales price of the Common Stockcommon stock on August 31,September 14, 2007, which shall become exercisableis currently exercisable; and (c) received on September 1, 2008; and (c) will receive on September 1,15, 2008 an option for 250,000 shares priced at $0.29 per share, the closing sales price of the Common Stock as of AugustSeptember 14, 2008. This final option was forfeited by Mr. Bleier upon his resignation effective December 31, 2008 which shall become exercisableand the remaining unexercised options expired on September 1,March 31, 2009. |
| Each set of the aforementioned options expireswas originally set to expire five years from its respective date of vesting. The Company hasWe have never re-priced any option (including those in the table) or otherwise modified any such option (such as by extension of exercise periods, the change of vesting or forfeiture conditions or the change or elimination of applicable performance criteria). | | | | 2. | This option was to vest on September 1, 2009. Mr. Bleier forfeited this option upon his resignation effective December 31, 2008. |
Table of ContentsDirector Compensation Table
| | | | | | | | | | | | | | | | | | | | Name | | | Fees
Earned in
Cash
($)(1) | | | Option
Awards
($)(2) | | | Total
($) | | William B. Wachtel | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | | | William R. Colaianni | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | | | Donald Hecht | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | | | Thomas Iovino | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | | | Jeffrey B. Mendell | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | | | Stephen B. Siegel | | | | | — | | | | | | 18,000 | | | | | | 18,000 | | | Alvin S. Trenk | | | | | 3,000 | | | | | | 18,000 | | | | | | 21,000 | |
18
Director Compensation for 2008
The following table shows information regarding the compensation paid to our-non-employee directors for their service during the fiscal year ended December 31, 2008. | Name (1) | Fees Earned or Paid in Cash ($)(2) | Option Awards ($)(3)(4) | Total ($) | | | | | | | William B. Wachtel | 4,000 | 2,000 | 6,000 | | | | | | | Donald Hecht | 4,000 | 2,000 | 6,000 | | | | | | | Jeffrey B. Mendell | 4,000 | 2,000 | 6,000 | | | | | | | Alvin S. Trenk | 4,000 | 2,000 | 6,000 | | | | | | | William R. Colaianni (5) | 4,000 | 2,000 | 6,000 | | | | | | | Thomas Iovino (6) | 4,000 | 2,000 | 6,000 | | | | | | | Stephen B. Siegal (7) | 4,000 | 2,000 | 6,000 | | | | | |
| 1. | Directors who are not employeesJohn H. Dow was ineligible to receive compensation for his service as a director because he served as our President and Chief Executive Officer until his resignation effective March 2, 2009. Ronald J. Ricciardi was ineligible to receive compensation for his service as a director because he served as our Vice Chairman. Mr. Ricciardi now serves as our Chairman of the Company areBoard of Directors, President and Chief Executive Officer. | | | | 2. | Unless otherwise waived by a director, each non-employee directors is entitled to a fee of $1,000 per board meeting and $750 and $500 per committee meeting for committee chairman and committee member, respectively. Each director is also reimbursed for expenses incurred in connection with attendance at meetings of the Board of Directors. |
2. | | | 3. | Each non-employee director is eligible to be granted an annual option to purchase shares of the Common Stock.our common stock. On April 19, 2007,December 1, 2008, the Compensation Committee granted each non-employee director an option for his service in 2006. On December 1, 2007, the Compensation Committee granted each non-employee director an option for his service in 2007. Each set of options was forto purchase 25,000 shares and wasof our common stock. The options were priced at $0.36$0.08 per share, which was the closing sales price of the Common Stockour common stock on April 18, 2007 and November 30, 2007, the day prior to the grant date.December 1, 2008. The options may be exercised until April 18, 2012 for the options issued on April 19, 2007 and November 30, 20122013. | | | | 4. | The table below presents the aggregate number of stock option outstanding for the options issued oneach of our non-employee directors as of December 1, 2007.31, 2008. |
| | Stock Option Awards | | | | | William B. Wachtel | | 100,000 | | | Donald Hecht | | 75,000 | | | Jeffrey B. Mendell | | 100,000 | | | Alvin S. Trenk | | 100,000 | | | William R. Colaianni | | 100,000 | | | Thomas Iovino | | 75,000 | | | Stephen B. Siegal | | 75,000 | |
| 5. | Mr. Colaianni resigned from the Board of Directors effective January 5, 2009. | | | | 6. | Mr. Iovino resigned from the Board of Directors effective March 5, 2009. | | | | 7. | Mr. Siegal resigned from the Board of Directors effective March 4, 2009. |
Employment and Change-in-Control Agreements
On September 1, 2006, the CompanyJanuary 2, 2004, FBO Air, Inc. entered into an employment agreement effectivewith Mr. Ricciardi (the “Employment Agreement”) to serve as of September 15, 2006its President and Chief Executive Officer. This corporation was merged with Keith P. Bleier (theand into FirstFlight, Inc., a public ‘‘Bleiershell’’ then named Shadows Bend Development, Inc., in a reverse merger transaction on August 20, 2004. Simultaneously with the reverse merger transaction, Mr. Ricciardi was elected as our President and Chief Executive Officer, subject to his Employment Agreement’’). Pursuant to the BleierAgreement. Under his Employment Agreement, Mr. Bleier servesRicciardi is entitled to indemnification against any and all claims and/or lawsuits born from the Companyfurtherance of his duties as our executive officer. Mr. Ricciardi is also entitled premium health insurance, an automobile allowance and a Senior Vice President and its Chief Financial Officer. Theterm life insurance policy paid for by us. Mr. Ricciardi is obligated to not disclose our confidential information even after the term of the Bleierhis employment. The Employment Agreement provides that we may terminate such agreement, upon ten days’ prior written notice, without cause. In such event, Mr. Ricciardi is entitled to one-year’s base salary as severance, in addition to his incentive bonus on a pro rata basis and to participate in non-cash employee benefit plans for three years,a period of six months. The Employment Agreement contains a change of control provisions which commenced on September 15, 2006, and thereafter automatically renews for additional one-year periods, unless terminated by either party upon 90 days’ notice prior toinvolves the startoccurrence of any renewal period. Mr. Bleier’s base annual salary is $185,000 with annual increasesone of 5%. In addition, he may receive an annual performance bonus atthese following events (i) the discretionsale of all of substantially all of our assets, (ii) a merger or consolidation of us in which the then stockholders of us own less than 50% of the Board of Directors. Mr. Bleier is to be granted an option each September 1 during the initial term to purchase 250,000 shares of the Common Stock, commencing September 15, 2006 . The first option was granted effective September 1, 2006 and the second option was granted effective September 15, 2007.On September 23, 2005, Airborne and the Company entered into an employment agreement dated as of September 23, 2005 (the ‘‘Dow Employment Agreement’’) with John H. Dow. Pursuant to the Dow Employment Agreement, Mr. Dow is employed in the office of Chief Executive of Airborne. The termstock of the agreement is for three years, which commenced September 23, 2005, and thereafter automatically renews for additional one-year periods, unless terminated by either party upon 90 days’ notice prior tosurviving corporation, or (iii) the startsale of any renewal period. Mr. Dow receives an annual base salarytwo-thirds or more of $150,000 and is guaranteed annually a bonus of $100,000 with the salary and bonus to be paid on a bi-weekly basis. In addition, he may receive an annual performance bonus based on the Board’s evaluation of Airborne’s performance and his performance. Mr. Dow was to be granted an option each September 23 during the initial term to p urchase 250,000outstanding shares of our common stock in one transaction. If the Common Stock. The first option was granted effective September 23, 2005, the second option was granted effective September 23, 2006 and the third option was granted effective September 23, 2007. On December 12, 2006, Mr. Dow was elected as the Presidentemployee leaves within one year of the Company byoccurrence of the Boardchange of Directorscontrol event, then Mr. Ricciardi will have his unvested stock options vest and designated as its Chief Executive Officer.
be covered for six months under our non-cash employee benefit plans. Table of ContentsOn March 31, 2005, the Board of Directors authorized execution of the First Amendment to the Employment Agreement effective April 1, 2005 (the ‘‘First Amendment’’) to the employment agreement dated January 2, 2004 (the ‘‘Ricciardi Employment Agreement’) for Ronald J. Ricciardi, then the Company’s President and Chief Executive Officer.. The First Amendment provided that Mr. Ricciardi’s employment under the Ricciardi Employment Agreement was effective April 1, 2005 and would continue for three years thereafter subject to automatic one-year renewals, unless terminated by either party upon 90 days’ notice prior to the start of any renewal period. The First Amendment increased his base salary to $175,000. Mr. Ricciardi was to be granted an option each April 11st during the initial term to purchase 250,000 shares of the Common Stock.our common stock. The first option was granted effective April 1, 2005, the second opt ionoption was granted effective April 1, 2006 and the third option was granted effective April 1, 2007. On December 12, 2006, the Board of Directors authorized execution of the Second Amendmentsecond amendment to his Employment Agreement effective as of that date reflecting that Mr. Ricciardi was elected as Vice Chairman of the Board by the Board of Directors and, effective January 1, 2007, Mr. Ricciardi’s base salary was adjusted to $125,000 and the initial term of his amended Employment Agreement was extended to March 31, 2009. In all the above-cited employment agreements (other than the agreements with Messrs. Dow and Bleier during the initial term), the Company or,
As of December 31, 2008, our future severance commitments to Mr. Ricciardi are in the case of Mr. Dow, Airborne, may terminate such agreement, upon ten days’ prior written notice, without cause. In such event, each officer is entitled to one-year’s base salary as severance, in addition to his incentive bonus on a pro rata basis and to participate in non-cash employee benefit plans for a period of six months. All agreements have change of control provisions which involve the occurrence of one of these events: the sale of all of substantially all of the employer’s assets, a merger or consolidation of the Company in which the then stockholders of the Company own less than 50% of the shares of stock of the surviving corporation, or the sale of two-thirds or more of the outstanding shares of the Company in one transaction. If the employee leaves within one year of the occurrenc e of the change of control event, then each employee has his unvested stock options vest and he is covered for six months under the employer’s non-cash employee benefit plans. In addition, each of Messrs. Dow and Bleier is entitled to one year’s base salary and his prior year incentive bonus as severance pay.aggregate approximately $175,000.
Additional Narrative Disclosure The Company does Regarding Compensation
We do not offer a defined retirement or pension plan. Airborne and another subsidiary both maintained 401k plans prior to their acquisition by the Company. Those plans have been merged into the Company’s 401k Plan, whichOur 401-k plan covers all employees of the Company and its subsidiaries. The newly merged Planour employees. Our 401(k) plan contains an option for the Companyus to match each participant’sparticipant's contribution. Any employercompany contribution vests in equal installments over a five-year period on a 20% per year basis.period. During fiscal2008 and 2007, and fiscal 2006, the Company and its subsidiarieswe matched participant contributions at a rate of 50% of the first 6% of participant deferrals. EmployerOur contributions to the 401(k) plan totaled approximately $122,000 and $103,000 for the years ended December 31, 2008 and $61,000 for fiscal 2007, and fiscal 2006, respectively.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth,presents certain information as of April 24, 2009 regarding the Record Date, certain information with respect to all stockholders known by the Company to be beneficial ownersownership of more than 5% of its outstanding shares of the Common Stock, the Chief Executive Officer of the Company, all directors and all directors and executive officers of the Company as a group. The ownership information was furnished to the Company by the person or entity.
| · | Each of our current executive officers and directors; |
| · | All of our current directors and executive officers as a group; and |
| · | Each other person or entity known by us to own beneficially 5% or more of our issued and outstanding common stock. |
| | | | | | | of Beneficial Owner | | | Number of Shares
of Common Stock | | | Percentage of
Common Stock | John H. Dow(2) | | | 4,518,534(3) | | | 12.0% | c/o FirstFlight, Inc.
236 Sing Sing Road
Horseheads, NY 14845 | | | | | | | Ronald J. Ricciardi(4) | | | 1,893,575(5) | | | 5.1% | c/o FirstFlight, Inc.
236 Sing Sing Road
Horseheads, NY 14845 | | | | | | | | Keith P. Bleier | | | 250,000(6) | | | less than 1% | c/o FirstFlight, Inc.
236 Sing Sing Road
Horseheads, NY 14845 | | | | | | | | | | | Ronald J. Ricciardi (2) | | | 1,893,575 (3) | | | 5.5 | % | | c/o FirstFlight, Inc. | | | | | | | | | 101 Hangar Road | | | | | | | | | Wilkes-Barre/Scranton International Airport | | | | | | | | | Avoca, Pennsylvania 18641 | | | | | | | | | | | | | | | | William B. Wachtel(7) (4) | | | 6,980,243(8)7,005,243 (5) | | | 18.2%19.7 | % | c/o Wachtel & Masyr, LLP
| | | | | | | | 110 East 59thStreet
| | | | | | | | | New York, NY 10022 | | | | | | | | | | William R. Colaianni(9) | | | 74,375(10) | | | less than 1% | c/o Holding Capital Group LLC
630 Third Avenue
New York, NY 10017 | | | | | | | | | | Donald Hecht(9) (4) | | | 291,700(11)316,700 (6) | | | less than 1%-- | | c/o Hecht Andand Company, P.C.
| | | | | | | | 111 West 40thStreet
| | | | | | | | 20thFloor
| | | | | | | | | New York, NY 10018 | | | | | | | Thomas Iovino(9) | | | 2,025,250(12) | | | 5.4% | c/o Judlow Contracting, Inc.
26-15 Ulmer Street
College Point, NY 11354 | | | | | | | Jeffrey B. Mendell(9) | | | 310,293(13) | | | less than 1% | c/o JBM Realty Capital Corp.
100 Putnam Green
Greenwich, CT 06830 | | | | | | | Stephen B. Siegel(9) | | | 558,400(14) | | | 1.5% | c/o CB Richard Ellis
200 Park Avenue
New York, NY 10165 | | | | | | | Alvin S. Trenk(9) | | | 1,822,944(15) | | | 4.9% | 350 East 79th Street
Apartment 38C
New York, NY 10021 | | | | | | |
Table of Contents
| Jeffrey B. Mendell (4) | | | 335,293 (7) | | | 1.0 | % | | c/o JBM Realty Capital Corp. | | | | | | | | | 100 Putnam Green | | | | | | | | | Greenwich, CT 06830 | | | | | | | | | | | | | | | | | | Alvin S. Trenk (4) | | | 1,847,944 (8) | | | 5.3 | % | 350 East 79th Street | | | | | | | | | Apartment 38C | | | | | | | | | New York, NY 10021 | | | | | | | | | | | | | | | | | | John H. Dow (9) | | | 0 | | | -- | | | c/o Airborne, Inc. | | | | | | | | | 236 Sing Sing Road | | | | | | | | | Horseheads, New York 14845 | | | | | | | | | | | | | | | | | | Keith P. Bleier (10) | | | 0 | | | -- | | | c/o Fleischer’s Bagels, Inc. | | | | | | | | | 1688 North Wayneport Road | | | | | | | | | Macedon, New York 14502 | | | | | | | | | | | | | | | | | | Martin Sands and Steven Sands | | | 3,578,029 (11) | | | 10.5 | % | | c/o Laidlaw & Company (UK) Ltd. | | | | | | | | | 90 Park Avenue | | | | | | | | | New York, NY 10016 | | | | | | | | | | | | | | | | | | Peter Nordin | | | 1,957,359(12) | | | 5.7 | % | | Bakkerevej OA | | | | | | | | | Snekkersten, Denmark | | | | | | | | | | | | | | | | | | All directors and officers | | | 12,556,736 | | | 31.2 | % | | As a group (5 in number) | | | | | | | |
| (1) | The percentages computed in the table are based upon 36,582,98733,764,453 shares of the Common Stockour common stock, which were outstanding on the Record Date.April 24, 2009. Effect is given, pursuant to Rule 13-d(1)(i) under the Exchange Act of 1934, as amended, to shares of the Common Stockour common stock issuable upon the exercise of options or warrants currently exercisable or exercisable within 60 days of April 24, 2009. Unless otherwise indicated in the Record Date.footnotes to this table, each stockholder named in the table has sole voting and investment power with respect to all of the shares shown as owned by such stockholder. We have omitted percentages of less than 1% from the table. |
| (2) | John H. Dow is theRonald J. Ricciardi serves as our President and Chief Executive Officer and also serves as the Chairman of the Company and a directorBoard of the Company.Directors. |
| (3) | Of theThe shares of the Common Stockour common stock reported in the table as being beneficially owned by Mr. Dow, (a) 1,166,667 shares are owned by his wife Daphne Dow; (b) they share beneficial ownership of (i) 1,000,200 shares and (ii) a warrant expiring August 31, 2011 to purchase 600,000 shares which is currently exercisable; (c) 250,000 shares are issuable upon the exercise by him of an option expiring September 22, 2011 which is currently exercisable; and (d) 250,000 shares are issuable upon the exercise by him of an option expiring September 22, 2012 which is currently exercisable. |
(4) | Ronald J. Ricciardi is the Vice Chairman of the Board and a director of the Company. Prior to December 12, 2006, he was the President and Chief Executive Officer of the Company. |
(5) | The shares of the Common Stock reported in the table includeinclude: (a) 250,000 shares issuable upon the exercise of an option expiring March 31, 2010; (b) 250,000 shares issuable upon the exercise of an option expiring March 31, 2011; (c) 250,000 shares issuable upon the exercise of an option expiring March 21, 2012,31, 2012; and (d) 100,000 shares issuable upon the exercise of a warrant expiring August 31, 2011. Each of the three options and the warrant is currently exercisable. |
(6)(4) | The reporting person is a director of FirstFlight. |
| (5) | The shares of the Common Stockour common stock reported in the table reflect 250,000 shares issuable upon the exercise of an option expiring on August 31, 2012 which is currently excisable |
(7) | William B. Wachtel is the Chairman of the Board and a director of the Company. |
(8) | The shares of the Common Stock reported in the table includeinclude: (a) 208,336 shares issuable upon the exercise of a warrant expiring March 31, 2010;2010, which is currently exercisable; (b) 800,000 of the 1,200,000 shares subject to a warrant expiring September 22, 2010;2010, which portion is currently exercisable; (c) 750,000 shares issuable upon the exercise of a warrant expiring August 31, 2011;2011, which is currently exercisable; (d) 25,000 shares issuable upon the exercise of an option expiring December 12, 2010;2010, which is currently exercisable; and (e) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012. All three warrants and the two options are2012, which is currently exercisable. The shares of the Common Stockour common stock reported in the table do not reflect (x) 333,400 shares of the Common Stockour common stock and (y) 200,000 shares issuable upon the exercise of a warrant expiring August 31, 2011 (which is currently exerc isable)exercisable) acquired by Wachtel & Masyr, LLP, corporate counsel to the Company, in the private placement which the Company closed on September 1, 2006.provides us with certain legal services. Mr. Wachtel is a managing partner of such firm, but does not have sole dispositive or voting power with respect to his firm’ssuch securities. |
(9) | He is a director of FBO Air. |
Table of Contents(10)(6) | The shares of the Common Stockour common stock reported in the table includeinclude: (a) 25,000100,000 shares issuable upon the exercise of an optiona warrant expiring December 12, 2010August 31, 2011, which is currently exercisableexercisable; and (b) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012, which is currently exercisable. |
| (7) | The shares of the Common Stockour common stock reported in the table include (a) 100,000 shares issuable upon the exercise of a warrant expiring August 31, 2011 which is currently exercisable and (b) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012 which is currently exercisable. |
(12) | The shares of the Common Stock reported in the table include (a) 750,000 shares issuable upon the exercise of a warrant expiring August 31, 2011 which is currently exercisable and (b) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012 which is currently exercisable. |
(13) | The shares of the Common Stock reported in the table includeinclude: (a) 50,000 shares issuable upon the exercise of aan investor warrant expiring March 31, 2010, which is currently exercisable; (b) 25,000 shares issuable upon the exercise of an option expiring December 12, 2010, which is currently exercisable; and (c) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012, which is currently exercisable. |
(14)(8) | The shares of the Common Stockour common stock reported in the table includeinclude: (a) 200,000400,000 shares of the 1,200,000 shares subject to a warrant expiring September 22, 2010, which portion is currently exercisable; (b) 25,000 shares issuable upon the exercise of an option expiring September 29, 2009, which is currently exercisable; (c) 500,000 shares issuable upon the exercise of a warrant expiring August 31, 2011, which is currently exercisableexercisable; and (b)(d) 25,000 shares issuable upon the exercise of an option expiring April 18, 2012, which is currently exercisable. |
(15)(9) | TheMr. Dow resigned as our President, Chief Executive Officer and director on March 2, 2009. |
| (10) | Mr. Bleier resigned as our Senior Vice President, Chief Financial Officer and Chief Accounting Officer effective December 31, 2008. |
| (11) | Each of Martin Sands and Steven Sands has dispositive power and voting power with respect to the shares of our common stock (including the Common Stock reported in the table include (a) 400,000 shares of the 1,200,000 shares subject to a warrant expiring September 22, 2010; (b) 25,000 shares issuable upon the exercise of an option expiring September 29, 2009; (c) 500,000 shares issuable upon the exercisewarrants) owned by Sands Brothers Venture Capital LLC and three other Sands Brothers funds. None of a warrant expiring August 31, 2011; (d) 25,000 shares issuable upon the exercise of an option expiring December 12, 2011; and (e) 25,000 shares issuable upon exercise of an option expiring April 18, 2012. Eachthese funds individually owns more than 5% of the warrantsoutstanding shares of our common stock as of April 24, 2009. As a result of the Sands possessing such dispositive and voting powers each may be deemed the options is currently exercisable.beneficial owner with respect to the shares of our common stock held by each of these stockholders. However, each disclaims beneficial ownership of these shares. |
(16)(12) | Peter Nordin beneficially owns (a) 556,877 shares of our common stock and (b) 150,000 shares issuable upon the exercise of a warrant expiring March 31, 2010.2010, which is currently exercisable. Peter Nordin APS owns (a) 983,815938,815 shares of our common stock and (b) 266,667 shares issuable upon the exercise of a warrant expiring March 31, 2010. The warrants are2010, which is currently exercisable. Peter Nordin may be deemed the beneficial owner of both the shares he owns personally and those of Peter Nordin APS because he has sole dispositive power and sole voting power with respect to the latter’s shares. |
(17) | Each of Martin Sands and Steven Sands has dispositive power and voting power with respect to the shares of the Common Stock (including the shares issuable upon the exercises of warrants expiring March 31, 2010, which are currently exercisable) owned by Sands Brothers Venture Capital III LLC and three other Sands Brothers funds. No one of these funds individually owned as much as 5% of the outstanding shares of the Common Stock as of the Record Date. As a result of the Sands possessing such dispositive and voting powers, each may be deemed the beneficial owner with respect to the shares of the Common Stock held by each of these stockholders. However, each disclaims beneficial ownership of these shares.Peter Nordin APS. |
The Company is
We are not aware of any arrangements, including any pledge by any person of shares of the Common Stock,our common stock, the operation of which may at a subsequent date result in a change in control of the Company.control. Nor is any director of the Company aware of any change in control which has occurred since the beginning of fiscal 2007.during 2008. Certain Relationships and Related Person Transactions
TableThe firm of ContentsPROPOSAL TWO: AUTHORITY TO BOARD TO IMPLEMENT
A POSSIBLE REVERSE STOCK SPLIT
General
TheWachtel & Masyr, LLP provides certain legal services to us. William B. Wachtel, our former Chairman of the Board, and current member of the Board of Directors, has long recognizedis a managing partner of such firm. During fiscal year 2008, we were billed approximately $90,000 by Wachtel & Masyr, LLP for legal services.
On March 2, 2009, we entered into a Share Exchange Agreement with Airborne, Inc., our former wholly owned subsidiary, John H. Dow, our former President and disclosed thatChief Executive Officer, and Daphne Dow, pursuant to which we divested our ownership interest in Airborne. Mr. Dow resigned immediately preceding the obtainingagreement. Prior to the consummation of additional financing may be a prerequisitethe Share Purchase Agreement, Airborne was our wholly-owned subsidiary. Airborne owns and operates an aircraft management and charter business. Pursuant to the terms and conditions of the Share Exchange Agreement, Mr. and Mrs. Dow exchanged all of their 3,418,534 individually and jointly owned shares of our common stock, valued at $239,297 on the date of the agreement, and all of their options and warrants to purchase 1,100,000 shares of our common stock owned by them in exchange for all of the Company to effect further acquisitions in the aircraft services industry in which the Company’s subsidiaries operate.issued and outstanding shares of Airborne common stock owned by us. As a result of the Company receiving $5,025,000 in gross proceeds fromconsummation of the Share Exchange Agreement, Mr. and Mrs. Dow became the sole owners of Airborne. Concurrent with the consummation of the Share Exchange Agreement, Airborne also assumed all pre- and post-closing rights and obligations of us under lease agreements for our IST Center and our 236 Sing Sing Road, Horseheads, New York location. We did not obtain a private placementthird party valuation with respect to this transaction.
Simultaneous with the consummation of the Share Exchange, we made a non-interest bearing loan to Airborne of $750,000 pursuant to a Loan Agreement dated March 2, 2009 (the “Airborne Loan Agreement”). Under the Airborne Loan Agreement, we made a commitment to loan Airborne an aggregate amount up to $750,000. $500,000 of such amount was loaned by us to Airborne on March 2, 2009, and the balance of which it closedwas loaned by us to Airborne on March 12, 2009, upon the satisfactory achievement by Airborne of certain agreed upon targets. Beginning on September 1, 2006,2009, and continuing the first day of each month thereafter until July 31, 2015, Airborne will pay us equal payments of $10,500 under the Airborne Loan Agreement. Beginning on August 1, 2015 and continuing the first day of each month thereafter, the monthly payment by Airborne to us under the Airborne Loan Agreement shall be $8,000. The Airborne Loan Agreement did not contain any personal guarantees from the shareholders of Airborne. Balances due under the Airborne Loan Agreement are to be repaid from the cash flow from operations in fiscal 2007, the Board does not believe that additional financing is currently required for other corporate purposesof Airborne. Due to uncertainties in the foreseeable future. However,charter business, management is in the Company’s revenue may not continueprocess of evaluating the collectability of this loan. The Airborne Loan Agreement provides that in the event of a subsequent sale of Airborne or its assets, the proceeds of such sale shall be used first to grow as quickly as management anticipatesrepay Airborne’s existing credit facility with Five Star Bank and additional financing for purposes other than acquisitions may be required.Various investment banking personnel with whom management has consulted have advisednext to repay any outstanding principal under the CompanyAirborne Loan Agreement. In addition, the Airborne Loan Agreement provides that unless there iswe will share a higher market pricepercentage of any remaining available sale proceeds, the amount of which will vary depending on the timing of a sale transaction.
Immediately prior to entering into the Airborne Loan Agreement described above, EuroAmerican Investment Corp. loaned us an aggregate amount of up to $750,000 for the Common Stock, they do not believe that additional financingpurpose of funding the Airborne Loan Agreement. The EuroAmerican loan is evidenced by a promissory note delivered by us to EuroAmerican with a maturity date of March 2, 2011. The unpaid principal amount under the promissory note accrues interest at the annual rate of 12% and is payable in monthly interest payments until maturity, at which time the entire principal balance and any accrued but unpaid interest is payable in full. Two members of our Board of Directors, William B. Wachtel and Alvin S. Trenk, issued personal guarantees in connection with the EuroAmerican Loan.
Proposals Submitted for Inclusion in Our Proxy Materials We will be consummatedinclude in our proxy materials for the Company on2010 annual meeting of stockholders, stockholder proposals that comply with Rule 14a-8 under the most favorable terms. CertainSecurities Exchange Act of these personnel have also noted1934, as amended. Among other things, Rule 14a-8 requires that a reduction in the number of shares of the Common Stock that would be outstanding on a fully diluted basis (i.e., 50,335,108 shares as of the Record Date if all of the outstanding options and warrants were exercised) would make a financing more attractive to investment bankers. In addition, they have noted that a higher market price for the Common Stock would enable the Company to effect the financing in a manner less dilutive to the current stockholders. Certain of these investment banking personnel have suggested that the only method simultaneously to increase the market price of the Common Stock and to decrease the number of outstanding shares on a fully diluted basis is to implement a reverse stock split. As an example, if a one-for-five reverse stock split was implemented and the market price was $.40 per share, then, afterwe receive such a split, a stockholder holding five shares of the Common Stock valued at $2.00 in the aggregate would now own one share at a market price of $2.00 per share, at least initially. In such event, the 50,335,108 shares would become 10,067,022 shares after a one-for-five reverse stock split, subject to the Company issuing a full share for any fractional share.Investment banking personnel with whom the Company has consulted have advised the Company that a listing of the Common Stock on the AMEX or on Nasdaq would facilitate the Company’s ability to obtain financing on a more favorable basis, as well as being beneficial in other ways to existing stockholders. See the immediately following section ‘‘Reasons for the Reverse Stock Split’’ under this caption ‘‘Proposal Two: Authority to Board to Implement a Possible Reverse Stock Split.’’ Based on its analysis of the entry criteria for listing the Common Stock on the AMEX or for having the Common Stock listed on the Nasdaq Capital Market, the Board has concluded that a major stumbling block to any such listing on the AMEX or on the Nasdaq Capital Market is that the current bid price of the Common Stock is far lessproposals no later than $3.00 per share, i.e., the AMEX entry criteria, and $4.00 per share, i.e., the Nasdaq entry criteria. Depending on the size of the split and the success of the reverse stock split (see the second succeeding paragraph), a reverse stock split could, in the Board’s opinion, enable the Company to overcome this stumbling block based on the market price of the Common Stock.
The Board also recognizes that, at the Annual Meeting of Stockholders held on December 12, 2006, the stockholders gave authority to the Board to implement, at the directors’ discretion, a reverse stock split in an amount not to be less than one-for-three more than one-for-ten at any time on or prior to November 15, 2007. However, because market and other conditions, in the opinion of the Board, did not warrant implementation, no reverse stock split was implemented.
However, assuming that stockholders approve Proposal Three and the directors subsequently implement a reverse stock split, no assurance can be given that, after a reverse stock split is effected, the market price of the Common Stock will remain at the proportionately increased price with the proposed decrease in the outstanding number of shares of the Common Stock. If, for example, the Company were to effect a one-for-five reverse stock split of the Common Stock, there is no assurance that the new market price would remain at five times the prior market price and would not drop to
Table of Contentsthe price level120 days prior to the contemplated split, which is often what develops with respect to a reverse stock splitone-year anniversary of this proxy statement. Thus, for the 2010 annual meeting of stockholders, we must receive stockholder proposals submitted for inclusion in other public companies. Nor can thereour proxy materials no later than January 18, 2010. Stockholder proposals submitted for inclusion in our proxy materials should be any assurance as to precisely what effect the proposed reverse stock would have on the market price of the Common Stock. In addition, at the time that the Company makes its applicationmailed to the AMEX or Nasdaq, the Company mayfollowing address: 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary.
Proposals Not Submitted for Inclusion in Our Proxy Materials Stockholder proposals that are not meet the other requirementssubmitted for listing on the AMEX or on Nasdaq. Finally, even if the market price of the Common Stock retains the level of the reverse stock split and the Common Stock is listed on the AMEX or on Nasdaq, there can be no assurance that the Company will obtain financing on more favorable terms, if at all.The Board also recognizes that the timing for affecting a reverse stock split is a key elementinclusion in determining whether the desired goal of a higher market price for the Common Stock is likely to be achieved. The Board is cognizant of the fact that general market conditions not related to the Company or its securities and market and other conditions relating to the Company specifically can affect the result, especially because, although the Company is operating on a profitable basis, there still are certain risks or uncertainties as to its future. The Board has concluded that market and other conditions do not warrant implementing a reverse stock split at the current time. However, the directors would prefer to avoid the time delay and the expense of calling a Special Meeting of Stockholders at a later date when they deem the time appropriate for taking such action. Accordingly, instead of asking the stockholders to authorize a reverse stock split in a specified a mount and for the Company to implement the change at the current time, the Board is seeking stockholder approval of a proposal to authorize a reverse stock split in an amount which the Board deems appropriate, if and when required. Such amount would not be less than one-for-three nor more than one-for-ten. In addition, the timing of its effectiveness would be at such time as the Board determines, but not later than June 15, 2009. If the reverse stock split is not affected by June 15, 2009, then the Board believes that the desirability of implementing a reverse stock split should be the subject of consideration at the Annual Meeting of Stockholders in 2009, if at all.
The reverse stock split, if authorized by the stockholders at the Meeting and if subsequently implemented by the Board, will be effected by the filing of an Amendment to Article Fourth of the Company’s Articles of Incorporation relating to capitalization. If, for example, a one-for-five reverse stock split was to be effected, the authorized shares of the Common Stock will be changed from 100,000,000 shares with a par value of $.001 per share to 20,000,000 shares with a par value of $.005 per share. The 36,582,987 shares outstanding on the Record Date in such example would become 7,316,598 shares, with any fractional share being increased to a full share. The 18,967,121 shares currently reserved would become 3,793,425 shares after a one-for-five reverse stock split, with any fractional share thereafter issued being increased to a full share. Your attention is directed to the section ‘‘Stock Certificates’’ later under this c aption ‘‘Proposal Two: Authority to Board to Implement a Reverse Stock Split’’ in this Proxy Statement.
Reasons for Reverse Stock Split
As indicated above in the section ‘‘General’’ under this caption ‘‘Proposal Two: Authority to Board to Implement a Reverse Stock Split,’’ the Board of Directors believes that a successful reverse stock split may have the following benefits, among others, for the Company:
| | | | • | facilitate any necessary financing because a higher market price may be a prerequisite to doing financing on acceptable terms, |
| | | | • | facilitate any necessary financing because a reduction in the number of outstanding shares of the Common Stock on a fully dilutive basis may be a prerequisite to doing a financing on acceptable terms, |
| | | | • | a financing at a higher offering price because of a higher market price will be less dilutive to current stockholders and |
| | | | • | a higher market price may enable the Company to qualify the Common Stock for listing on the AMEX or on the Capital Market of Nasdaq. |
Table of ContentsThe Board believes that a higher market price for the Common Stock should result if the Company continues to operate on an ever increasing profitable basis, even without a reverse stock split and assuming that the current major decline in stock market prices generally does not materially worsen over a long period of time. Nevertheless, the Board does not believe that it is in the best interests of the Company to wait to see if and when such higher market price occurs. There can be no assurance that the Company will continue to operate on an ever increasing profitable basis or that the market price will rise as the Board anticipates, especially with the current limited trading market for the Common Stock, or, even if it does, whether the increase will occur within the time frame in which any financing should be consummated. In addition, without a reverse stock split, there will be no reduction in the number of shares of the Common Stock outstanding on a fully dil utive basis. Finally, although there can be no assurance that any of the results described in this paragraph will be achieved, the Board believes that a reverse stock split may be the best method during the next few months to attempt to realize these objectives.
Additionally, because the Common Stock is not on the AMEX or Nasdaq and because its bid price has been below $5.00 per share, the Common Stock has become subjectour proxy materials pursuant to Rule 15g-9 promulgated under the Exchange Act. This Rule imposes additional sales practices requirements on a broker-dealer which sells Rule 15g-9 securities to persons other than the broker-dealer’s established customers and institutional accredited investors (as such term is defined in Rule 501(a)14a-8 under the Securities Act. For transactions covered under Rule 15g-9,Exchange Act of 1934, as amended, as described above, may be brought before the broker-dealer must make a suitability determination2010 annual meeting of the purchaser andstockholders if we receive the purchaser’s written agreement to the transactionsuch proposals no later than 45 days prior to the sale. In addition, broker-dealers, particularly if theyone-year anniversary of this proxy statement. Thus, for the 2010 annual meeting of stockholders, we must receive stockholder proposals that are market makersnot submitted for inclusion in the Common Stock, have toour proxy materials no later than April 3, 2010. We will not permit stockholder proposals that do not comply with the disclosure requirementsforegoing notice requirement to be brought before the 2010 annual meeting of Rule 15g-2, 15g-3, 15g-4, 15g-5 and 15g-6 under the Exchange Act unless the transaction is exempt under Rule 15g-1. Consequently, Ru le 15g-9 and these other Rules may adversely affect the ability of broker-dealers to sell or to make marketsstockholders. Stockholder proposals that are not submitted for inclusion in the Common Stock and, accordingly, make it more difficult for stockholders to sell their shares whenever they desire to take such action. If the Common Stock were listed on the AMEX or on Nasdaq, or if the bid price of the Common Stock were above $5.00 per share, these ‘‘penny stock’’ rules would notour proxy statement should be applicablemailed to the Company.
In addition, institutional investors which generally do not purchase stocks traded on the OTC Bulletin Board would more likely consider the Common Stock as a possible investment if it were traded on the AMEX or on Nasdaq. A listing of the Common Stock on the AMEX or on Nasdaq would also exempt that security from compliance with the ‘‘blue sky’’ laws of all 50 states and the District of Columbia and, accordingly, would reduce the Company’s expenses in any future public or private offering under the Securities Act.
In addition to the possibility of avoiding continuing application to the Common Stock of the Rules under the Exchange Act referred to in the second preceding paragraph, the Board believes that the reverse stock split may result in certain additional benefits to stockholders, such as:
| | | | • | creating the ability for them to execute purchase or sale orders with certain brokerage firms which restrict or discourage execution or orders for low-priced stocks, |
| | | | • | the ability for them to purchase shares of the Common Stock on margin (assuming approval by the Federal Reserve Board) with those firms which do not allow margin purchases of very low-priced stocks and |
| | | | • | the ability for them to have purchases or sales executed at a lower commission rate per dollar of investment. |
However, as indicated above in the section ‘‘General’’ under this caption ‘‘Proposal Two: Authority to Board to Implement a Reverse Stock Split,’’ the Board cannot assure a stockholder as to what effect the proposed reverse stock split will have on the market price of the Common Stock. Accordingly, there can be no assurance that any or all of the objectives set forth in this subsection would be achieved.
following address: 101 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, Pennsylvania 18641, Attention: Corporate Secretary.
Table of ContentsEffect on Stockholders
Holders of the Common Stock have no preemptive, subscription or conversion rights and are entitled to dividends on a prorata basis when and if declared by the Board of Directors. The proposed reverse stock split will not affect any of these rights. However, because of the management’s desire to use cash flow to grow the business, the likelihood of dividends being paid on the Common Stock in the foreseeable future is extremely remote.
Each holder of the Common Stock has one vote per share on all matters submitted to stockholders for a vote. A reverse stock split will not affect such right.
Upon liquidation of the Company, each holder of the Common Stock is entitled to share ratably any assets available for distribution after payment of all debts and distribution in respect of any then outstanding shares of the Company’s Preferred Stock, $.001 par value (of which no shares are currently outstanding). The reverse stock split, if implemented, will not affect the liquidation rights of the holders of the Common Stock.
Accordingly, except for the increase in the par value of a share of the Common Stock and the concurrent decrease in the number of shares held by each holder of the Common Stock as a result of the reverse stock split, if implemented, the Board is of the opinion that the proposed Amendment to the Articles of Incorporation would create no material differences between the shares of the Common Stock prior to the Amendment and the shares of the Common Stock after the Amendment.
Stock Certificates
If the proposed Amendment to the Articles of Incorporation of the Company permitting the Board of Directors to effect a proposed reverse stock split is adopted by the stockholders at the Meeting and thereafter the Amendment is filed in the State of Nevada as required by the Nevada General Corporation Law to become effective, each stockholder must turn in his, her or its stock certificate to Continental Stock Transfer and Trust Company, the Transfer Agent for the Common Stock, for exchange for a new stock certificate evidencing the post-reverse-stock-split Common Stock and the new CUSIP number assigned to the Company. The Company will give notice to each stockholder, and will make a form available for such purpose, at the appropriate time. If, upon making the exchange for the new certificates evidencing the Common Stock, a fractional share would otherwise be issued, no fractional share will be issued and the stockholder making the exchange will receive instead a full share for the fractional share. Had the Board authorized cash payments in lieu of fractional shares if Proposal Two was approved at the Meeting, a stockholder would, if he, she or it dissented in the manner provided in Sections 92A.300 through 92A.500 of the Nevada Revised Statutes, have had the right to receive payment for his, her or its shares of the Common Stock.
Recommendation
FOR THE REASONS DESCRIBED ABOVE, THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR PROPOSAL TWO TO AUTHORIZE A REVERSE STOCK SPLIT OF THE COMMON STOCK IN AN AMOUNT (NOT LESS THAN ONE-FOR-THREE NOR MORE THAN ONE-FOR-TEN) AND AT A TIME TO BE DETERMINED BY THE DIRECTORS (BUT NOT LATER THAN JUNE 15, 2009).
Table of ContentsOTHER MATTERS COMING BEFORE THE MEETING As of the date of this Proxy Statement,proxy statement, the Board of Directors does not know of any other matters that are to be presented tofor action at the Meeting other than the two proposals set forth in the attached Notice of Annual Meeting. If2009 annual meeting. Should any other matters properlymatter come before the Meeting, it is intended that2009 annual meeting, however, the holders of the management proxies will vote thereonpersons named in their discretion.MISCELLANEOUS
The solicitation of proxies on the enclosed form of proxy is made by and on behalf of the Board of Directors of the Company and the cost of this solicitation is being paid by the Company. In additionwill have discretionary authority to the use of the mails,vote all proxies may be solicited personally, or by telephone, by the executive officers or directors of the Company.
The last Annual Meeting of Stockholders was held on December 12, 2006 and no Annual Meeting was held in 2007. The Board intends that future Annual Meetings of Stockholders will be held in June, commencing in 2009, so stockholders can receive on a timely basis a copy of audited financial statements for the prior fiscal year in connection with such Meeting. The Company’s fiscal year ends December 31st of each year.
If you, as a stockholder, intend to submit a proposal for inclusion in the Company’s proxy statement for the Annual Meeting of Stockholders in 2009, you must send such proposal so as to be received by the Company no later than a reasonable time before the Company prints and mails its proxy material for such Annual Meeting. If you, as a stockholder, intend to submit a proposal for consideration at such Annual Meeting by means other than the inclusion of the proposal in the Company’s proxy statement for such Annual Meeting, you must notify the Company of such intention no later than a reasonable time before the Company prints and mails its proxy material for such Annual Meeting, or risk management exercising discretionary voting authority with respect to the management proxies to defeat such proposal when and if presented at the Annual Meeting.
The Company currently anticipates mailing the proxy material for the Annual Meeting of Stockholdersmatter in 2009 on or before May 25, 2009. Should such date change or the proposed date of the Annual Meeting change to a date more than 30 days from the date of this year’s meeting (i.e., June 19, 2008), the Company intends to include a notice to such effect in a Quarterly Report on Form 10-Q.
A representative of Marcum & Kliegman LLP will be present at the Meeting. The Company has been informed that the representative does not intend to make any statement to the stockholders at the Meeting, but will be available to respond to appropriate questions from stockholders.
The Company is enclosingaccordance with this Proxy Statement a ‘‘wrap-around’’ copy of the Company’s Annual Report on Form 10-K for fiscal 2007 (the ‘‘2007 Annual Report’’) containing audited financial statements. The audited financial statements, the management’s discussion and analysis of financial condition and results of operations and the section relating to quantitative disclosures about market risk included in the 2007 Annual Report are incorporated herein by this reference. The copy of the 2007 Annual Report being enclosed with this Proxy Statement does not contain any exhibits. If you desire a copy of any exhibit to the 2007 Annual Report, you may request any or all of the exhibits by making a written or oral request as set forth below. A reasonable fee for duplicating and mailing will be charged for a copy of any exhibit requested.
The unaudited financial statements and the related management’s discussion and analysis of financial condition and results of operation included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 (the ‘‘Quarterly Report’’) are incorporated herein by this reference thereto A copy of the Quarterly Report is not enclosed with this Proxy Statement. However, the Company undertakes to provide, without charge, to each person to whom this Proxy Statement is delivered, upon the written or oral request of such person, a copy of the Quarterly Report by first class mail or other equally prompt means within one business day of receipt of such request. You may also review the Quarterly Report on the Company’s website, www.FFLT.com. The
their judgment.
Table of ContentsCompany recently began to include on that website all of its periodic reports filed with the Securities and Exchange Commission since 2002 and will post on the web site all future periodic reports as they are filed
You may make a written or oral request for a copy of the Quarterly Report or an exhibit to the 2007 Annual Report to Ronald J. Ricciardi, Vice Chairman of the Board of the Company, at the following address of the Company: 100 Hangar Road, Wilkes-Barre/Scranton International Airport, Avoca, PA 18641, or telephone number: (570) 457-3400.
| By Order of the Board of Directors
/s/ Ronald J. Ricciardi
Ronald J. Ricciardi President and Chief Executive Officer |
May 18, 2009  q FOLD AND DETACH HERE AND READ THE REVERSE SIDEq
PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FIRSTFLIGHT, INC.
The undersigned appoints Ronald J. Ricciardi and William B. Wachtel as proxies with the power to appoint his substitute, and authorizes him to represent and to vote, as designated on the reverse hereof, all of the shares of common stock of FirstFlight, Inc. held of record by the undersigned at the close of business on May 14, 2009 at the 2009 Annual Meeting of Stockholders of FirstFlight, Inc. to be held on June 18, 2009 or at any adjournments or postponements thereof. |
| The undersigned shall attend the Annual Meeting in person | Yes o | No o |
(Continued, and to be marked, dated and signed as instructed on the other side) qFOLD AND DETACH HERE AND READ THE REVERSE SIDEq
| Robert W. Berend
Secretary |
May 22, 2008
| | | | | | | Table of Contents | | | | Page | Notice of Annual Meeting of Shareholders | | | | | N/A | | Proxy Statement | | | | | 1 | | Voting Securities | | | | | 1 | | Proposal One: Election of Directors | | | | | 2 | | Executive Compensation | | | | | 12 | | Security Ownership of Certain Beneficial Holders and Management | | | | | 16 | | Proposal Two: Authority to Board to Implement Possible Reverse Stock Split | | | | | 19 | | Other Matters Coming Before the Meeting | | | | | 23 | | Miscellaneous | | | | | 23 | |
FIRSTFLIGHT, INC.
Notice of Annual Meeting
of Shareholders and
Proxy Statement dated
May 22, 2008
Annual Meeting Date:
June 19, 2008
 FOLD AND DETACH HERE AND READ THE REVERSE SIDE
|
PROXY FOR FIRSTFLIGHT, INC. ANNUAL MEETING OF STOCKHOLDERS JUNE 19, 2008
| Please mark
your votes
like this
| x
| THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED AND THE PROXY IS SIGNED, IT WILL BE VOTED “FOR” THE PROPOSALS. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF FIRSTFLIGHT, INC. | | Please mark your votes like this:x |
Proposals – The Board of Directors recommends a vote FOR the listed nominees.
| | | | FOR
| AGAINST
| ABSTAIN
| | FOR
| WITHHOLD
AUTHORITY
| 2. PROPOSAL TO AUTHORIZE A REVERSE STOCK SPLIT
| o
| o
| o
| 1.ELECTION OF DIRECTORS: | o
FOR | o
| 3. In their discretion the proxies are authorized to vote upon such other business as may properly come
before the meeting or any postponements or adjournments thereof.
WITHHOLD AUTHORITY | 01 - WILLIAM R. COLAIANNI,02 – JOHN H. DOW,
03 – DONALD HECHT
04 – THOMAS IOVINO,
05 – JEFFREY
02 –JEFFREY B. MENDELL | 06
03 – RONALD J. RICCIARDI 07 – STEPHEN B. SIEGEL,
08
05 – WILLIAM B. WACHTEL | (To withhold authority to vote for any individual nominee, strike a line through that nominee’s name in the list above)
| £ |
£ YES £
|
NO £
| | | | The undersigned shall attend the Annual Meeting in person
| o
| o
|
£ £ | | | | COMPANY ID:
| | | | | | | | | | | | | | | | | | PROXY NUMBER:
| | | | | | | | | | | | | | | | | | ACCOUNT NUMBER:
| | | | | | | | | | | | | | | | | | | | Signature
| | Signature
| | Date, 2008.
| |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON JUNE 18, 2009
The proxy statement and annual report to security holders are available at www.FFLT.com/investorrelations/secfilings
For directions on how to attend the annual meeting and vote in person, please review the “Voting” section of the proxy statement.
NOTE: Please sign exactly as name appears hereon. When shares are held by joint owners, both should sign. When signing as attorney, executor, administrators, trustees or guardians, please give title as such. If a corporation, please sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by individual person.
| COMPANY ID: PROXY NUMBER: ACCOUNT NUMBER: |
Signature _________________________________ Signature _______________________________ Date___________________________ NOTE: Please sign exactly as name appears hereon. When shares are held by joint owners, both should sign. When signing as attorney, executor, administrators, trustees or guardians, please give title as such. If a corporation, please sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by individual person. FOLD AND DETACH HERE AND READ THE REVERSE SIDE
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FIRSTFLIGHT, INC.
The undersigned appoints John H. Dow and Ronald J. Ricciardi, and each of them, as proxies each with the power to appoint his substitute, and authorizes each of them to represent and to vote, as designated on the reverse hereof, all of the shares of Common Stock of FirstFlight, Inc. held of record by the undersigned at the close of business on May 16, 2008 at the 2008 Annual Meeting of Stockholders of FirstFlight, Inc. to be held on June 19, 2008 or at any adjournments or postponements thereof.
(Continued, and to be marked, dated and signed, on the other side)
|
![[X]](https://files.docoh.com/DEF 14A/0000950136-08-002777/xbox.gif){kind=small}
