Collins Industries, Inc.
15 Compound Drive
Hutchinson, Kansas 67502-4349
(620) 663-5551
www.collinsind.com
January 21, 2003
Dear Stockholder
You are cordially invited to attend the Annual Meeting of Stockholders of Collins Industries, Inc. which will be held at 10:00 a.m., local time, on Friday, February 28, 2003, at Intrust Bank, 105 North Main, 3rd Floor, Executive Dining Room, Wichita, Kansas.
We plan to review the status and future opportunities for the Company and the industries we serve. The principal business matter to be considered at the meeting will be the election of one director.
Attached you also will find the Notice of the Annual Meeting of Stockholders and your proxy for the meeting. It is important that your shares be represented at the meeting, and we hope you will be able to attend the meeting in person. Whether or not you plan to attend the meeting please be sure to vote as soon as possible. You may vote in person, by mail, by telephone or via the Internet. Instructions to vote by each of these methods are enclosed.
Your prompt response will save the Company the cost of further solicitation of unreturned proxies.
We look forward to seeing you on February 28.
| Sincerely yours, |
|
| /s/ Don L. Collins, |
|
| Don L. Collins, |
|
| Chairman of the Board |
|
COLLINS INDUSTRIES, INC.
15 Compound Drive
Hutchinson, Kansas 67502
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On February 28, 2003
NOTICE IS HEREBY GIVEN THAT the annual meeting of Stockholders (the "Annual Meeting") of Collins Industries, Inc., a Missouri corporation (the "Company"), will be held at 10:00 a.m., local time, on Friday, February 28, 2003 at Intrust Bank, 105 North Main Street, 3rd Floor, Executive Dining Room, Wichita, Kansas, for the purpose of considering and voting upon the following matters:
1. The election of one director to serve his respective term and until his successor shall be elected and shall qualify, and
2. The transaction of such other business as may properly come before the meeting and any adjournments thereof.
All of the above matters are more fully described in the accompanying Proxy Statement, into which this notice is incorporated by reference.
The Board of Directors has fixed the close of business on December 24, 2002, as the date of record for determining stockholders entitled to receive notice of and to vote at the Annual Meeting and any adjournments thereof. The stock transfer books of the Company will remain open between the record date and the date of the meeting.
IN ORDER THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING, PLEASE FILL OUT, DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY EVEN IF YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON. A RETURN-ADDRESSED ENVELOPE, WHICH REQUIRES NO POSTAGE, IS ENCLOSED. IF YOU LATER DESIRE TO REVOKE OR CHANGE YOUR PROXY FOR ANY REASON, YOU MAY DO SO AT ANY TIME BEFORE THE VOTING, BY DELIVERING TO THE COMPANY A WRITTEN NOTICE OF REVOCATION OR A DULY EXECUTED PROXY BEARING A LATER DATE OR BY ATTENDING THE ANNUAL MEETING AND VOTING IN PERSON.
| By order of the Board of Directors |
|
Dated: January 21, 2003 | /s/ Larry W. Sayre |
|
| Larry W. Sayre, |
|
| Secretary |
|
COLLINS INDUSTRIES, INC.
15 Compound Drive
Hutchinson, Kansas 67502
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To be held on February 28, 2003
GENERAL INFORMATION
INTRODUCTION. This Proxy Statement is furnished in connection with the solicitation by and on behalf of the Board of Directors of Collins Industries, Inc. ("the Company") of proxies for use at the annual meeting of Stockholders to be held at 10:00 a.m., local time, on Friday, February 28, 2003 at Intrust Bank, 105 North Main, 3rd Floor, Executive Dining Room, Wichita, Kansas 67201 and any adjournment thereof (the "Annual Meeting"), and, together with the enclosed Notice of Annual Meeting, Form of Proxy and Annual Report to Stockholders for the fiscal year ended October 31, 2002 (the "Annual Report"), is being mailed to Stockholders on or about January 21, 2003. The address of the principal executive offices of the Company is 15 Compound Drive, Hutchinson, Kansas 67502. Except for items specifically incorporated by reference herein, the Annual Report does not form any part of this Proxy Statement.
REVOCABILITY OF PROXIES. Each proxy that is properly executed and returned in time for use at the Annual Meeting will be voted at the Annual Meeting, and any adjournments thereof, in accordance with the choices specified. Any proxy given pursuant to this solicitation may be revoked by the person giving it at any time before the voting by delivering to the Company a written notice of revocation or a duly executed proxy bearing a later date or by attending the Annual Meeting and voting in person.
COST OF SOLICITATION. The entire cost of solicitation of proxies will be borne by the Company. Solicitation will be made by mail. Additional solicitation may be made by officers and employees of the Company by means of a follow-up letter, personal interview, telephone or telegram. Such persons will receive no additional compensation for such services. Proxy cards and materials also will be distributed to beneficial owners through brokers, custodians, nominees and similar parties, and the Company intends to reimburse such parties for reasonable expenses incurred by them in connection with such distribution.
QUORUM AND VOTING. The authorized capital stock of the Company consists of 17,000,000 shares of Common Stock, $.10 par value per share (the "Common Stock") and 3,000,000 shares of Capital Stock, other than Common Stock, $ .10 par value per share (the "Capital Stock"). As of the close of business on December 24, 2002 (the "Record Date"), there were 7,098,629 shares of Common Stock outstanding and no shares of Capital Stock outstanding. All of the shares of Common Stock issued and outstanding as of the Record Date are entitled to vote at the Annual Meeting.
Only stockholders of record of the 7,098,629 shares of Common Stock, issued and outstanding as of the Record Date, will be entitled to vote. Each share of Common Stock is entitled to one vote on all matters, except in the election of directors where the stockholders have cumulative voting rights as described under "Election of Directors." The presence, in person or by proxy, of the holders of record of a majority of the outstanding shares of Common Stock entitled to vote is necessary to constitute a quorum at the Annual Meeting. Abstentions and broker non-votes are tabulated as if no votes were cast for the matters indicated.
MATTERS TO BE ACTED UPON AT THE MEETING
As indicated in the Notice of Annual Meeting of Stockholders, at the Annual Meeting, one director will be elected.
Proposal 1:
ELECTION OF DIRECTOR
The Board of Directors is presently comprised of five (5) directors serving staggered three-year terms.
Each Stockholder has cumulative voting rights in electing directors, which means the number of shares owned may be multiplied by the number of directors to be elected and the cumulative total voted for one (1) candidate or otherwise distributed among any number of candidates. Cumulative voting rights may be exercised in the same manner as other voting rights; that is, by proxy or in person. The candidate receiving the highest number of votes shall be elected. The person named in the enclosed proxy, or his substitute, will vote signed and returned proxies for the nominee listed below and, unless otherwise indicated on the proxy, cumulative votes will be divided equally between the nominees. The proxies cannot be voted for a greater number of persons than the number of nominees named below. The nominee has been designated as such by the Board of Directors for the terms specified by his name and has agreed to serve if elected. The nominee is currently serving as a director and information abo ut the nominee is set forth under "Management."
The Board of Directors has no reason to believe that the nominee will become unavailable for election. However, if for any reason, the nominee is not available for election, another person or persons may be nominated by the Board of Directors and voted for in the discretion of the person named in the enclosed proxy. Vacancies on the Board of Directors occurring after the election will be filled by Board appointment to serve until the next election of such position by the Stockholders.
THE BOARD OF DIRECTORS RECOMMENDS ELECTION OF THE
FOLLOWING NOMINEE
Arch G. Gothard, III 3-year term
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of December 24, 2002, with respect to (i) each person who is known by the Company to own beneficially in excess of 5% of the outstanding Common Stock, (ii) each director of the Company, (iii) each named executive officer and (iv) all directors and executive officers of the Company as a group. Each person listed below exercises sole voting power and sole investment power unless otherwise indicated by footnote. As of December 24, 2002, there were 7,098,629 shares of Common Stock of the Company issued and outstanding.
Name and Address | Shares Beneficially Owned | Percentage Owned | |
|
|
| |
Venture Securities Corporation | 788,309(1) | 11.11% | |
| 516 North Bethlehem Pike |
|
|
| Spring House, PA 19477 |
|
|
|
|
| |
Collins Industries Tax Deferred | 564,391(2) | 7.95% | |
| Savings Plan and Trust c/o InTrust Bank, Trustee P.O. Box 8338 Prairie Village, KS 66208 |
|
|
|
|
|
|
Don L. Collins | 1,194,586(3) | 16.35% | |
| 157 East New England Avenue, Suite 364 Winter Park, FL 32789 |
|
|
|
|
|
|
Donald Lynn Collins | 774,597(4) | 10.49% | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
Arch G. Gothard, III | 180,625(5) | 2.53% | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
Don S. Peters | 183,100(6) | 2.56% | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
William R. Patterson | 49,000(7) | * | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
Terry L. Clark | 136,107(8) | 1.90% | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
Larry W. Sayre | 113,864(9) | 1.59% | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
|
|
Kent E. Tyler | 63,515(10) | * | |
| 15 Compound Drive Hutchinson, KS 67502 |
|
|
|
|
| |
| All executive officers and | 2,757,133(11) | 34.92% |
| directors as a group (9 persons) |
|
|
_________________
* Less than 1%.
(1) Pursuant to Schedule 13G/A filed with the Securities and Exchange Commission on January 25, 2002, Venture Securities Corporation, ("Venture") is a registered investment advisor and furnishes investment advice to approximately 1,200 clients and certain of those clients hold Collins Industries common stock. In its role as investment advisor and investment manager, Venture possesses both voting and investment power over certain securities owned by their clients. All securities reported herein are owned by Venture or its clients and Venture is deemed to have beneficial ownership of 788,309 shares of the Company's common stock as of December 24, 2002. However, no one client nor Venture itself, holds more than 5% of the stock of Collins Industries in their account. Of the 788,309 shares as to which Venture is deemed to have beneficial ownership, Venture is deemed to have (i) sole voting power with respect to 361,975 shares (ii) shared voting power with respect to 0 shares (iii) sole dispositive power with respect to 788,309 shares and (iv) shared dispositive power with respect to 0 shares.
(2) As of December 24, 2002, based on information received from the Trustee of the Plan.
(3) Does not include 7,559 shares owned by Sharon Collins, the wife of Mr. Collins, as to which Mr. Collins disclaims beneficial ownership. Includes (i) 205,800 shares deemed beneficially owned pursuant to options exercisable within 60 days and (ii) 64,922 shares owned by Collins Capital Corporation, of which Mr. Collins is an officer, for which Mr. Collins shares voting and investment power.
(4) Includes (i) 282,600 shares deemed beneficially owned pursuant to options exercisable within 60 days and (ii) 64,922 shares owned by Collins Capital Corporation, of which Mr. Collins is an officer, for which Mr. Collins shares voting and investment power.
(5) Includes 45,000 shares deemed beneficially owned pursuant to options exercisable within 60 days. Mr. Gothard has shared investment power with respect to 30,160 shares.
(6) Includes 65,000 shares deemed beneficially owned pursuant to options exercisable within 60 days. Mr. Peters has shared investment power with respect to 82,550 shares.
(7) Includes 10,000 shares deemed beneficially owned pursuant to options exercisable within 60 days.
(8) Includes 80,800 shares deemed beneficially owned pursuant to options exercisable within 60 days.
(9) Includes 55,000 shares deemed beneficially owned pursuant to options exercisable within 60 days.
(10) Includes 30,000 shares deemed beneficially owned pursuant to options exercisable within 60 days.
(11) Includes 796,700 shares deemed beneficially owned pursuant to options exercisable within 60 days.
MANAGEMENT
Directors and Executive Officers
The following table sets forth certain information with respect to the directors and executive officers of the Company.
Name | Age | Position Within The Company |
|
|
|
Don L. Collins (1) | 71 | Chairman, Director |
|
|
|
Donald Lynn Collins (2) | 50 | President, Chief Executive Officer, Director |
|
|
|
Don S. Peters (1) | 73 | Director |
|
|
|
Arch G. Gothard, III (3) | 57 | Director |
|
|
|
William R. Patterson (2) | 61 | Director |
|
|
|
Terry L. Clark | 51 | Executive Vice President of Operations |
|
|
|
Larry W. Sayre | 54 | Vice President of Finance and Chief Financial Officer |
|
|
|
Rodney T. Nash | 57 | Vice President of Engineering |
|
|
|
Kent E. Tyler | 36 | Vice President of Marketing |
(1) Term as director expires in 2005.
(2) Term as director expires in 2004
(3) Nominee for reelection. Term as director expires in 2003.
Don L. Collins, founder of the Company, has served as Chairman of the Board since its inception in 1971 and served as Chief Executive Officer until 1998. He is Chairman of the Board's Executive Committee.
Donald Lynn Collins joined the Company in 1980 after being associated with Arthur Andersen LLP, an international accounting firm. Mr. Collins has served as Chief Executive Officer of the Company since 1998, as President since 1990 and as a director since 1983. He served as the Chief Operating Officer from 1988 until 1998. He is a member of the Board's Policy Committee and Executive Committee Committees. He is the son of Don L. Collins.
Don S. Peters, a director of the Company since 1983, founded and was chairman of Peters, Gamm, West and Vincent, Inc. an investment advisory firm in Wichita, Kansas, from 1983 to December 1991. He has been a financial consultant with Central Plains Advisors, Inc. since December 1991. He is a member of the Board's Audit, Compensation, Finance and Nominating Committees.
Arch G. Gothard, III, a director of the Company since 1987, was president of First Kansas Group, an investment firm in Junction City, Kansas, from 1988 to 1999. He was chief financial officer, treasurer and director of Communications Services, Inc. from 1985 to 1989. He is a member of the Board's Audit Committee and is Chairman of the Board's Nominating, Compensation and Finance Committees. Mr. Gothard also serves as a director of Kenco Plastics, Colorado Power Sports, Pay Phone Concepts and Dornoch Medical Systems.
William R. Patterson became a director in 1998. Since August, 1998 he has been a principal of Stonecreek Management, LLC. From October 1996 to August 1998, he was Executive Vice President of Premium Standard Farms, Inc., where he served as a consultant and as acting Chief Financial Officer from January 1996 to October 1996. From September 1976 through December 1995 he was a partner in Arthur Andersen LLP. Mr. Patterson is a member of the Finance, Executive, Nominating and Compensation Committees and is Chairman of the Audit and Policy Committees. Mr. Patterson also serves as a director of American Italian Pasta Company and Paul Mueller Company.
Terry L. Clark joined the Company in July 1993 as President of Mobile-Tech Corporation and was promoted to Vice President of Operations of the Company in July, 1994 and to Executive Vice President of Operations of the Company in November 1996. Mr. Clark was President of Quest Communications, Inc. from February 1990 to March 1992 and was Chief Financial Officer and Chief Operating Officer of Ascom Autelca, Inc. from November 1988 to February 1990, two companies serving the telecommunications industry.
Larry W. Sayre joined the Company in August 1993 as Vice President of Finance and Chief Financial Officer. He has served as Treasurer of the Company since 1995 and as Secretary since 2001. Mr. Sayre is a certified public accountant and previously served in the national accounting firms of KPMG and Grant Thornton. Prior to joining the Company, he was Vice President of Finance and Chief Financial Officer of a manufacturer of telecommunications equipment and a manufacturer of plastic containers.
Rodney T. Nash joined the Company in 1979 as Engineering Manager and was named Vice President of Engineering of the Company in November 1986. Prior to joining the Company, he held engineering positions with Hesston Corporation and Butler Manufacturing.
Kent E. Tyler joined the Company in December 1997 as Vice President of Marketing. Prior to joining the Company, he was Vice President of Ackerman McQueen, a full-service national marketing and advertising agency.
All executive officers serve at the discretion of the Board of Directors.
Section 16(a) - Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires executive officers and directors of the Company, and persons who beneficially own more than ten percent (10%) of the Common Stock (collectively referred to herein as "Reporting Persons"), to file initial reports of ownership and reports of changes in ownership with the Securities and Exchange Commission (the "Commission"). Reporting Persons are required by Commission regulations to furnish the Company with copies of all Section 16(a) forms they file.
Based solely upon a review of copies of Forms 3, 4 and 5 and amendments thereto furnished to the Company during its most recent fiscal year, the Company believes that all of these forms required to be filed by Reporting Persons were timely filed pursuant to Section 16(a) of the Exchange Act.
COMMITTEES OF THE BOARD
The Board of Directors has established standing Audit, Compensation and Nominating Committees. The principal responsibilities of each committee are described below. The members of each such committee are identified in the director biographies set forth under "Management."
The Audit Committee consists of three non-employee directors, each of which is "independent", as defined by the rules of the National Association of Securities Dealers. The Audit Committee met four times during Fiscal 2002. It appoints a firm of independent public accountants to examine the accounting records of the Company and its subsidiaries for the coming year. In making this appointment, it reviews the nature of both audit-related and non-audit-related services rendered or to be rendered to the Company and its subsidiaries by the independent public accountants. The Audit Committee meets with representatives of the Company's independent public accountants and reviews with them audit scope, procedures and results, including any recommendations. It also meets with the Company's chief financial officer to review reports on the functioning of financial controls.
The Compensation Committee, consisting of three non-employee directors, met twice during Fiscal 2002. The Compensation Committee establishes the compensation policies of the Company and makes salary recommendations to the Board of Directors for all elected officers. It also recommends bonuses for officers and other senior executives.
The Nominating Committee, consisting of three non-employee directors, met once during Fiscal 2002. It recommends to the Board of Directors nominees for director to be proposed for election by the stockholders and also reviews the qualifications of, and recommends to the Board of Directors, candidates to fill Board of Director vacancies as they may occur during the year. The Nominating Committee considers suggestions from many sources, including stockholders, regarding possible candidates for director. Such suggestions, together with appropriate biographical information, should be submitted to the Secretary of the Company for consideration by the Nominating Committee by October 31, 2003 for the next annual stockholders meeting. Guidelines regarding the qualifications of candidates for directors, insofar as they apply to non-employees, generally favor individuals who have managed relatively large, complex business, educational, or other organizations or who, in a professional or busin ess capacity, are accustomed to dealing with complex business or financial problems.
Actions taken by any committee of the Board of Directors are reported to the Board of Directors, usually at its next meeting.
There were twelve Board of Directors meetings during Fiscal 2002. In Fiscal 2002, each director attended more than 75% of (i) the total number of meetings of the Board of Directors and (ii) the total number of meetings held by all committees of the Board on which he served.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation paid during each of the Company's last three fiscal years to the Company's Chief Executive Officer and the other named executive officers.
ANNUAL COMPENSATION
Name and |
| Other Annual | ||
Principal Position | Year | Salary ($) | Bonus ($) | Compensation ($) |
|
|
|
|
|
(a) | (b) | (c) | (d) | (e) |
Don L. Collins | 2002 | 403,287 | 60,000 | -- |
Chairman | 2001 | 396,150 | 90,000 | -- |
| 2000 | 395,417 | 150,000 | -- |
|
|
|
|
|
Donald Lynn Collins | 2002 | 374,012 | 115,000 | -- |
President, Chief | 2001 | 351,750 | 130,000 | -- |
Executive Officer | 2000 | 343,125 | 200,000 | -- |
|
|
|
|
|
Terry L. Clark | 2002 | 234,144 | 55,000 | -- |
Executive Vice | 2001 | 223,075 | 60,000 | -- |
President, Operations | 2000 | 218,333 | 80,000 | -- |
|
|
|
|
|
Larry W. Sayre | 2002 | 182,763 | 30,000 | -- |
Vice President | 2001 | 172,050 | 35,000 | -- |
Finance & CFO | 2000 | 166,250 | 50,000 | -- |
|
|
|
|
|
Kent E. Tyler | 2002 | 154,144 | 25,000 | -- |
Vice President | 2001 | 148,075 | 30,000 | -- |
Marketing | 2000 | 140,208 | 40,000 | -- |
SUMMARY COMPENSATION TABLE - (CON'T)
LONG TERM COMPENSATIONS
Name and Principal Position |
Year | Restricted Stock Awards ($) (1) | Securities Underlying Options/ SARs (#) | LTIP Payouts | All Other Compensation ($) | |
|
|
|
|
|
| |
|
| (f) | (g) | (h) | (i) | |
Don L. Collins | 2002 | 150,000(2) | -- | -- | -- | |
Chairman | 2001 | 52,500(2) | -- | -- | -- | |
| 2000 | 61,875(2) | -- | -- | -- | |
|
|
|
|
|
| |
Donald Lynn Collins | 2002 | 350,000(3) | -- | -- | -- | |
President, Chief | 2001 | 122,500(3) | -- | -- | -- | |
Executive Officer | 2000 | 144,375(3) | -- | -- | -- | |
|
|
|
|
|
| |
Terry L. Clark | 2002 | 75,000(4) | -- | -- | -- | |
Executive Vice | 2001 | 26,250(4) | -- | -- | -- | |
President, Operations | 2000 | 30,938(4) | -- | -- | -- | |
|
|
|
|
|
| |
Larry W. Sayre | 2002 | 75,000(5) | -- | -- | -- | |
Vice President | 2001 | 17,500(5) | -- | -- | -- | |
Finance & CFO | 2000 | 20,625(5) | -- | -- | -- | |
|
|
|
|
|
| |
Kent E. Tyler | 2002 | 75,000(6) | -- | -- | -- | |
Vice President | 2001 | 26,250(6) | -- | -- | -- | |
Marketing | 2000 | 30,938(6) | -- | -- | -- | |
|
|
|
|
|
| |
(1) | Under the terms of the Company's Restricted Stock Award Agreements, dividends are paid on restricted stock at the same rate as paid on all other outstanding shares of the Company's stock. | |||||
|
| |||||
(2) | Aggregate value at October 31, 2002 amounted to $193,200 based on an aggregate total of 60,000 Restricted shares. | |||||
|
| |||||
(3) | Aggregate value at October 31, 2002 amounted to $450,800 based on an aggregate total of 140,000 Restricted shares. | |||||
|
| |||||
(4) | Aggregate value at October 31, 2002 amounted to $96,600 based on an aggregate total of 30,000 Restricted shares. | |||||
|
| |||||
(5) | Aggregate value at October 31, 2002 amounted to $80,500 based on an aggregate total of 25,000 Restricted shares. | |||||
|
| |||||
(6) | Aggregate value at October 31, 2002 amounted to $96,600 based on an aggregate total of 30,000 Restricted shares. | |||||
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
The following table provides information related to options exercised by the named executive officer during the 2002 fiscal year and the number and value of options held at fiscal year end. The Company does not have any outstanding stock appreciation rights.
|
|
| Number of Underlying Unexercised Options at FY-End (#) | Value of Unexercised In-the-Money Options at FY-End ($) |
Name | Shares Acquired on Exercise (#) | Value Realized ($) | Exercisable/Unexercisable | Exercisable/Unexercisable |
(a) | (b) | (c) | (d) | (e) |
Don L. Collins | -- | -- | 205,800/0 | $0/0 |
Donald Lynn Collins | -- | -- | 282,600/0 | $0/0 |
Terry L. Clark | -- | -- | 80,800/0 | $0/0 |
Larry W. Sayre | -- | -- | 55,000/0 | $0/0 |
Kent E. Tyler | -- | -- | 30,000/0 | $0/0 |
Directors' Compensation
During Fiscal 2002, the Company paid each employee director $1,100 for each Board of Directors meeting attended, which amounts are included in the Summary Compensation Table. Outside directors received $1,700 for each Board of Directors meeting attended and $1,100 for each Board of Directors committee meeting attended. In addition, Mr. Peters, Mr. Gothard and Mr. Patterson each received Board of Directors retainer fees of $1,800 per month. Committee fees are not paid (i) to inside directors and (ii) to outside directors when such committee meetings are held on the same day as a Board of Directors meeting or in conjunction with a General Managers meeting.
Report of the Compensation Committee on Executive Compensation
The Company applies a consistent philosophy of compensation for all employees, including senior management. This philosophy is based on the premise that the achievements of the Company result from the coordinated efforts of individuals working toward common objectives. The Company strives to achieve those objectives through teamwork that is focused on meeting the expectations of customers, stockholders and employees.
Executive Compensation Philosophy. The Compensation Committee of the Board of Directors makes compensation recommendations to the Board of Directors and is composed of three directors outside, independent directors. The goals of the Compensation Committee are to align compensation with business objectives and performance, and to enable the Company to attract, retain and reward executive officers who contribute to the long-term success of the Company. The Compensation Committee considers several factors in establishing the executive compensation program of the Company, including both subjective and objective factors. Although profitability of the Company and market value of its Common Stock are considered in establishing the executive compensation program, neither of these factors are determinative. Rather, the Company's executive compensation program is based on the following principles:
The Company attempts to compensate competitively.
The Company is committed to providing a compensation program aimed at attracting and retaining highly qualified people, primarily from within the industry. To ensure that compensation is competitive, the Company periodically compares its compensation practices with those of competitors and other companies and sets its compensation parameters based on this review.
The Company compensates sustained performance.
Executive officers are rewarded based upon corporate performance and individual performance. Corporate performance is not determined strictly on the basis of designated criteria, but is evaluated on the basis of many factors including but not limited to earnings, revenues, product innovation, market share, strategic and business plan goals, the extent to which strategic and business plan goals are met and current industry conditions. Individual performance is evaluated by reviewing the executive officer's individual performance as well as the performance of that officer's functional area of responsibility.
The Company strives for fairness in the administration of compensation.
The Company attempts to apply its compensation philosophy uniformly. The Company strives to achieve a balance of the compensation paid to a particular individual and the compensation paid to other executives both inside the Company and at competing companies.
The Company's process of assessing executive performance is as follows:
1. At the beginning of the annual performance cycle, objectives and key goals are set for the Company's executives.
2. Each executive is given ongoing feedback on performance.
3. At the end of the annual performance cycle, the Chief Executive Officer and the Compensation Committee evaluate each executive's accomplishment of objectives and attainment of key goals.
4. The accomplishment of objectives and attainment of key goals affect decisions on salary increases and, if applicable, stock options.
Executive Compensation Vehicles. The Company utilizes the three components of its compensation program to attract and retain key executives, enabling it to improve its products, motivate technological innovation, foster teamwork and adequately reward executives, all with the goal of enhancing stockholder value. The annual cash-based compensation for executives consists of a base salary which reflects the respective executive's level of responsibility, breadth of knowledge and technical or professional skills and is subject to increases or decreases at the discretion of the Compensation Committee. Salaries are reviewed on an annual basis and may be changed at that time based on (i) information derived from the evaluation procedures described above, (ii) a determination that an individual's contributions to the Company have increased (or decreased), and (iii) changes in market conditions and competitive compensation levels.
From time to time the Company awards bonuses to executive officers upon attainment of certain Company financial and operational goals. These bonuses are set forth in the Compensation Table. From time to time the Company also makes available to directors and executive officers incentive bonuses pursuant to the Company's unwritten Executive Incentive Compensation Plan (the "Incentive Compensation Plan"). Under the Incentive Compensation Plan, the Company may award cash and/or restricted Common Stock to directors and executive officers of the Company. The Incentive Compensation Plan is administered by the Compensation Committee of the Board of Directors and is a discretionary plan based upon performance by the individual and the Company.
Long-term incentives are intended to be provided through the Company's 1997 Omnibus Incentive Plan which provides for granting (i) Stock Options, Restricted Stock Awards, Performance Shares, and/or Other Incentive Awards to employees of the Corporation and its Subsidiaries on the terms and subject to the conditions set forth in the Plan, and (ii) Director Options and Director Awards to Non-Employee Directors of the Company as approved by the Board. The Compensation Committee determines which executives will be eligible for incentives with the objective of aligning executives' long range interests with those of the stockholders by providing the executives with the opportunity to build a meaningful interest in the Company.
Compensation of the Chief Executive Officer. As with the other executive officers, the CEO's total compensation is based upon several factors, including both subjective and objective factors. For Fiscal 2002, the Compensation Committee compared the CEO's annual salary with the annual salaries of chief executive officers of competitors and other peer groups, pursuant to several published national studies (the "Studies"). The Compensation Committee authorized a 6.3% merit increase in the CEO's annual salary and determined the CEO's annual salary to be reasonable and appropriate in light of the comparison to the Studies. It is the policy of the Compensation Committee to authorize a bonus for the CEO upon the attainment of certain Company financial and operational goals. These bonuses are described above and set forth on the Summary Compensation Table.
Compensation Committee Members: | Arch G. Gothard, III, Chairman |
| William R. Patterson |
| Don S. Peters |
Compensation Committee Interlocks and Insider Participation
During Fiscal 2002, the members of the Compensation Committee were primarily responsible for determining executive compensation. Messrs. Arch G. Gothard, III, William R. Patterson and Don S. Peters comprise the Compensation Committee. Mr. Donald Lynn Collins was a former member of the Compensation Committee during the past fiscal year and is currently the President and Chief Executive Officer.
Report of the Audit Committee
The role of the Audit Committee is to appoint the Company's independent public accountants to examine the financial records of the Company and to assist the Board in monitoring the Company's auditing and financial reporting practices and related matters. Its specific responsibilities are set forth in the charter of the Audit Committee. Each member of the Audit Committee meets the current independence and experience requirements of the National Association of Securities Dealers.
On May 14, 2002, upon the recommendation of the Audit Committee, the Board of Directors of the Company approved the dismissal of Arthur Andersen LLP ("Arthur Andersen") to serve as the Company's independent auditors for the year ending October 31, 2002. The change was effective May 15, 2002.
Arthur Andersen's reports on the Company's consolidated financial statements for each of the years ended October 31, 2001 and 2000 did not contain an adverse opinion or disclaimer of opinion, nor were such reports qualified or modified as to uncertainty, audit scope or accounting principles.
During the years ended October 31, 2001 and 2000 and through May 15, 2002, there were no disagreements with Arthur Andersen on any matter of accounting principle or practice, financial statement disclosure, or auditing scope or procedure which, if not resolved to Arthur Andersen's satisfaction would have caused them to make reference to the subject matter of the disagreement in connection with the audit reports on the Company's consolidated financial statements for such years; and there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K.
On May 14, 2002 the Company provided Arthur Andersen with a copy of the foregoing disclosures. A copy of Arthur Andersen's letter addressed to the Securities and Exchange Commission was filed as an Exhibit 16 to a Form 8-K filed by the Company on May 16, 2002.
On June 13, 2002, upon the recommendation of the Audit Committee, the Board of Directors of the Company approved the appointment of KPMG LLP to serve as the Company's independent auditors for the year ending October 31, 2002.
During the years ended October 31, 2001 and 2000 and through June 13, 2002, Collins did not consult KPMG LLP with respect to the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on Collins' consolidated financial statements, or any other matters or reportable events as set forth in Items 304(a)(2)(i) and (ii) of Regulation S-K.
The Audit Committee reviewed and discussed with management the audited financial statements of the Company for fiscal year 2002. The Audit Committee also met with representatives of KPMG LLP, the Company's independent auditors, to discuss and review the results of the independent auditors' examination of the financial statements for the year ended October 31, 2002 and the matters that require discussion under Statement on Auditing Standards 61.
In addition, the Audit Committee has received from KPMG LLP the written disclosures required to be delivered by KPMG LLP under Independence Standards Board Standard No. 1 addressing all relationships between the auditors and the Company that might bear on the auditors' independence. The Audit Committee has reviewed the materials received from KPMG LLP, has met with representatives of KPMG LLP to discuss the independence of the auditing firm, and has satisfied itself as to the auditors' independence.
Based upon the Audit Committee's review of the financial statements and its other reviews and discussions noted above, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Company's Annual Report on Form 10-K for the year ended October 31, 2002.
AUDIT COMMITTEE |
William R. Patterson, Chairman |
Arch G. Gothard, III |
Don S. Peters |
Principal Accounting Firm Fees
Aggregate fees billed to the Company for the fiscal year ended October 31, 2002 by the Company's principal accounting firm, KPMG LLP:
Audit Fees [a] |
| $ 202,000 |
Financial Information Systems Design and Implementation Fees |
| -- |
All Other Fees [a] |
| $ 20,000 |
[a] - Includes fees paid to Company's former principal accounting firm (Arthur Andersen LLP) of $ 28,000
related to audit fees and $11,500 related to tax consulting and other non-audit fees.
Other Fees include fees for tax consulting and other non-audit services. The Audit Committee has considered whether the provision of these services is compatible with maintaining the principal accountant's independence.
Principal Accounting Firm
Representatives of KPMG LLP are expected to be present at the Annual Meeting and shall have the opportunity to make a statement and to respond to appropriate questions.
STOCK PERFORMANCE
The following chart shows a five-year comparison of cumulative total stockholder returns for the Company's Common Stock during the five (5) fiscal years ended October 31, 2002 with the NASDAQ U.S. Index and an index of peer groups selected by the Company. The companies in the peer group are Champion Industries, Federal Signal, Thor Industries, Spartan Motors and Supreme Industries. The comparison assumes an investment of $100 on October 31, 1997 in each index and the Company's Common Stock and that all dividends were reinvested.
| Base Year 1997 | 1998 | 1999 | 2000 | 2001 | 2002 |
|
|
|
|
|
|
|
Collins | $100.0 | $81.1 | $86.4 | $78.1 | $58.6 | $67.0 |
Peer Group | 100.0 | 106.3 | 95.6 | 72.9 | 76.4 | 138.4 |
NASDAQ-US | 100.0 | 139.6 | 259.1 | 157.3 | 124.2 | 86.2 |
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the 2004 Annual Meeting of Stockholders must be received by the Company at the offices shown on the first page of the Proxy Statement on or before September 18, 2003, in order to be included in the proxy material proposed to be issued in connection with such meeting. The deadline for providing timely notice to the Company of matters that stockholders otherwise desire to introduce at the 2004 Annual Meeting of Stockholders is December 2, 2003. The Company may exercise its discretionary voting authority to direct the voting of proxies on any matter submitted for a vote at the 2004 Annual Meeting of Stockholders if notice concerning proposal of such matter is not received prior to December 2, 2003. It is suggested that stockholders submit any proposals by certified mail, return receipt requested.
OTHER MATTERS
Management is not aware of any matters to come before the Annual Meeting which will require the vote of stockholders other than those matters indicated in the Notice of Meeting and this Proxy Statement. However, if any other matter requiring stockholder action should properly come before the Annual Meeting or any adjournment thereof, those persons named as proxies on the enclosed proxy card will vote thereon according to their best judgment.
| By order of the Board of Directors |
|
|
Dated: January 21, 2003 | /s/ Larry W. Sayre_____ |
| Larry W. Sayre, |
| Secretary |
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, |
| Please mark | |
1. ELECTION OF DIRECTORS |
FOR the nominee listed to the left | WITHHOLD AUTHORITY for the nominee listed to left | 2. In their discretion, the Proxies are further authorized to vote upon such other matters as may properly come before the meeting.
Note: These matters have been proposed by the Company and are not related to or conditioned upon the approval of other matters. |
|
| ||
|
| ||
|
| ||
|
| ||
|
| ||
|
| ||
| |||
Nominees - 3 Year Term Votes |
|
|
|
| |||
Note: |
|
|
|
| Please sign your name below and print your name exactly as |
Signature ___________________________________________________ Signature ________________________________________________ Date ____________________ | |
| |
Vote by Internet or Telephone or Mail Internet and telephone voting is available through 4PM Eastern Time the business day prior to annual meeting day. Your Internet or telephone vote authorizes the named proxies to vote your shares in the same manner
|
Internet |
| Telephone | OR |
| ||||||
Use the Internet to vote your proxy. Have your proxy card in hand when you access the web site. You will be prompted to enter your control number, located in the box below, to create and submit an electronic ballot. |
OR | Use any touch-tone telephone to | Mark, sign and |
| ||||||
If you vote your proxy by Internet or telephone, If you choose cumulative voting for Directors you MAY NOT use Internet or telephone voting COLLINS INDUSTRIES, INC. The undersigned hereby appoints William R. Patterson and Don Peters, and each of them, as proxies (the "Proxies"), with full power of substitution, and hereby authorizes them to represent and to vote in the order named, as designated on the reverse side all the shares of common stock of Collins Industries, Inc. (the "Company"), held of record by the undersigned as of December 24, 2002, at the Annual Meeting of Stockholders to be held on February 28, 2003, and any adjournments thereof. THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF EACH OF THE NOMINEES FOR DIRECTOR LISTED IN PROPOSAL 1. AS TO OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING, THIS PROXY SHALL CONFER DISCRETIONARY AUTHORITY UPON THE PROXIES TO VOTE ON SUCH MATTERS IN THEIR BEST JUDGMENT. The ballots cast by stockholders will be voted as marked at the Annual Meeting on February 28, 2003, if received by the date of the meeting. Upon attendance at the Annual Meeting by the Stockholder voting herein, this Proxy will be returned if requested, so that the Stockholder may vote in person. THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS WHICH ENCOURAGES EACH STOCKHOLDER OF RECORD TO VOTE. (Continued and to be voted, signed and dated on reverse side.)
.................................................................................................................................................................................................... CALCULATION OF NUMBER OF VOTES YOU MAY CAST
|
Fill in the number of shares you own: |
|
|
|
| |
Multiply by 1: |
| X1 |
|
|
|
Total votes: |
|
|
|
|
YOUR VOTE IS IMPORTANT! You can vote in one of three ways:
PLEASE VOTE |