BUTLER NATIONAL CORPORATION |
To the Shareholders of Butler National Corporation: |
Notice is hereby given that the Annual Meeting of Shareholders of Butler National Corporation (the "Company") will be held at the Holiday Inn-Olathe, 1010 West 151st Street, Olathe, Kansas, on Tuesday, January 24, 2006, at 11:00 a.m., for the following purposes: |
1. To elect two (2) directors to hold office for a term of three (3) years or until a successor is elected and qualified. |
The Board of Directors has fixed the close of business on December 13, 2005, as the record date for the determination of shareholders entitled to notice of and to vote at the meeting. |
By Order of the Board of Directors, |
Olathe, Kansas |
TO ASSURE YOUR REPRESENTATION AT THE MEETING, PLEASE SIGN, DATE AND RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE, WHETHER OR NOT YOU EXPECT TO ATTEND IN PERSON. SHAREHOLDERS WHO ATTEND THE MEETING MAY REVOKE THEIR PROXIES AND VOTE IN PERSON IF THEY DESIRE. |
BUTLER NATIONAL CORPORATION | ||
GENERAL | ||
VOTING | ||
SHAREHOLDER PROPOSALS | ||
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | ||
| Amount and Nature of Beneficial Ownership (1) |
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Clark D. Stewart | 5,237,819(2) | 9.8% |
R. Warren Wagoner | 4,141,126(3) | 7.8% |
(1) Unless otherwise indicated by footnote, nature of beneficial ownership of securities is direct, and beneficial ownership as shown in the table arises from sole voting power and sole investment power. |
The following table sets forth, with respect to our Common Stock (the only class of voting securities), (i) shares beneficially owned by all directors and named executive officers of Butler National Corporation, and (ii) total shares beneficially owned by directors and officers as a group, as of April 30, 2005. | |||
| Amount and Nature of | See Note | Percent of Class |
Larry B. Franke | 481,277 | (5) | 0.9% |
David B. Hayden | 1,357,225 | 2.6% | |
William E. Logan | 823,929 | (3) | 1.5% |
Christopher J. Reedy | 260,747 | 0.5% | |
Clark D. Stewart | 5,237,819 | (2) | 9.8% |
R. Warren Wagoner | 4,141,126 | (4) | 7.8% |
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ELECTION OF DIRECTORS | |||
The number of directors constituting our Board of Directors has been fixed at five (5). The Board is comprised of the following three classes of directors: No Class I Director; David B. Hayden and William E. Logan as Class II Directors; and Clark D. Stewart and R. Warren Wagoner as Class III Directors. The initial term of the Class II Directors was two years after their initial election and Class II Directors will serve until the 2005 (January 24, 2006) annual meeting or their successors are elected and qualified. The initial term of the Class III Directors is three years after their initial election and Class III Directors will serve until the 2006 annual meeting or until their successors are elected and qualified. After the expiration of the initial term, each class of Directors shall be elected to a three year term. Directors shall hold office until their successors have been elected and qualified. |
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT | ||||||||||||
The names and ages of the directors, their principal occupations for at least the past five years are set forth below, based on information furnished by the directors. | ||||||||||||
Name of Nominee and Director and Age | Served Since | Principal Occupation for Last Five Years and Other Directorships | ||||||||||
Clark D. Stewart | 1989 | President of our Company from September 1, 1989 to present. President of Tradewind Systems, Inc. (consulting and computer sales) 1980 to present.. | ||||||||||
R. Warren Wagoner | 1986 | Chairman of the Board of Directors of our Company since August 30, 1989 and President of our Company from July 26, 1989 to September 1, 1989. | ||||||||||
David B. Hayden | 1996 | Co-owner and President of Kings Avionics, Inc. since 1974 (avionics sales and service). Co-owner of Kings Aviation LLP (aircraft fixed base operation and maintenance) since 1994. | ||||||||||
William E. Logan | 1990 | Retired Vice President and Treasurer of WH of KC, Inc. (Wendy's franchisee). | ||||||||||
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During the fiscal year ended April 30, 2005, the Board of Directors met eight times. Each director attended 100% of the meetings of the Board of Directors. All Directors are expected to attend all meetings of the Board of Directors and the Annual Shareholders meeting. Members of the Board who are not otherwise our paid employees (all except Mr. Stewart and Mr. Wagoner) are paid $100 for each meeting attended. The Board of Directors has an Audit Committee, and a Compensation Committee, but no Nominating Committee. The Board of Directors believes that the responsibilities of a Nominating Committee can be handled as a function of the Board of Directors as a whole. During fiscal 2005, the Audit Committee consisted of David Hayden, William E. Logan and William A. Griffith (now deceased). Its function is to assist the President in the review of our financial performance and operations. The Audit Committee met four times during the fiscal year ended April 30, 2005 and all members of the Audi t Committee attended the meeting. | ||||||||||||
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R. Warren Wagoner | 53 | Chairman of the Board of Directors | ||||||||||
Clark D. Stewart | 65 | President and Chief Executive Officer | ||||||||||
Christopher J. Reedy | 39 | Vice President & Secretary | ||||||||||
Angela Shinabargar | 41 | Chief Financial Officer | ||||||||||
Kathy L. Gorrell | 45 | Treasurer | ||||||||||
Larry W. Franke | 61 | President of Avcon Industries, Inc., a wholly-owned subsidiary of Butler National Corporation | ||||||||||
Curtis Beadle | 41 | President of Butler National Services, Inc., a wholly-owned subsidiary of Butler National Corporation | ||||||||||
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Summary Compensation Table | ||||||||||||
Long Term Compensation | ||||||||||||
Annual Compensation | Awards | Payouts | ||||||||||
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| Restricted Stock Award(s) ($) | Securities Underlying Options (no.) (1) |
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Clark D. Stewart, President and CEO, Director | 05 | 320,450 | --- | --- | --- | --- | --- | --- | ||||
R. Warren Wagoner, Director - Chairman of the Board | 05 | 113,628 | --- | --- | --- | --- | --- | --- | ||||
Christopher J. Reedy, Vice President and | 05 | 147,384 | 2,500 | --- | --- | --- | --- | --- | ||||
Larry W. Franke, President of Avcon Industries | 05 | 172,699 | 5,000 | --- | --- | --- | --- | --- | ||||
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OPTION GRANTS, EXERCISES AND HOLDINGS | ||||
The following table provides further information concerning grants of stock options pursuant to the 1989 Nonqualified Stock Option Plan during fiscal year 2005 to the named executive officers: | ||||
OPTION GRANTS IN LAST FISCAL YEAR | ||||
Individual Grants | ||||
No options were granted in the last fiscal year. | ||||
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AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR | ||||
Number of Securities Underlying Unexercised Options at FY-End (No.) | Value of Unexercised In-the-Money Options at FY-End ($) | |||
| Number of Shares Acquired on Exercise | Value Realized ($) |
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R. Warren Wagoner, Director - Chairman of the Board | 1,465,000 | 0 | 12,143 / 0 | 0 / 0 |
Christopher J. Reedy, Vice President & Secretary | 255,747 | 0 | 0 / 0 | 0 / 0 |
Larry W. Franke, President of Avcon Industries | 400,400 | 0 | 80,877 / 0 | 0 / 0 |
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EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL ARRANGEMENTS. |
AUDIT COMMITTEE REPORT - Item 7(d)(3) |
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL ARRANGEMENTS |
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
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STOCK PERFORMANCE GRAPH |
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The peer group consists of companies with similar market capitalization. The Custom Selected Stock List is made up of the following small cap securities selected by CoreData Financial Information as peer companies: Activeworlds Corp, Atlas Pacific Ltd. Adr., Clinical Data Inc., Forward Industries, Inc., Hirsch Internat CP CL A, Interpharm Holdings Inc., Provena Foods Inc., Southern Security Life. |
AUDIT FEES | ||||
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Audit feesa | $53,490 | $50,275 | ||
a - Includes fees billed for professional services rendered in connection with the audit of the annual financial statements and for the review of the quarterly financial statements. | ||||
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All Other Fees | ||||
INDEPENDENT PUBLIC ACCOUNTANTS | ||||
We have engaged Weaver & Martin, LLC to audit our financial statements for the years ended April 30, 2003, 2004, and 2005. Weaver & Martin, LLC was able to express an opinion on the financial statements for the years ended April 30, 2003, 2004 and 2005. Representatives of Weaver & Martin, LLC are expected to be present at the Annual Meeting of Shareholders, and they will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions. | ||||
OTHER MATTERS | ||||
Management knows of no other matters that will be presented at the meeting. If any other matter arises at the meeting, it is intended that the shares represented by the proxies in the accompanying form will be voted in accordance with the judgment of the persons named in the proxy. |