4810 - 120th Street West, Apple Valley, MN 55124-8628 Telephone:
(952) 994-7651 or Fax: (952) 686-5427
November 11, 2004
ROBERT C. HARVEY
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
Dear Shareholder:
You are cordially invited to join us for our Annual Meeting of
Shareholders to be held this year on Friday, December 17, 2004,
at 11:00 a.m., local time, at the law firm of Faegre & Benson
LLP, 2200 Wells Fargo Center, 90 South Seventh Street,
Minneapolis, Minnesota.
The following notice of meeting identifies each business item for
your action. These items and the vote the Board of Directors
recommends are:
Item Recommended Vote
1. Election of five directors FOR
2. Ratification of WIPFLI LLP FOR
We have also included a proxy statement that contains more
information about these items and the meeting.
Your vote is important. Whether you own a few or many shares of
stock, it is important that your shares be represented. If you
cannot personally attend, we encourage you to make certain that
you are represented at the meeting by voting and signing the
accompanying proxy card and promptly returning it in the enclosed
envelope.
/s/ Robert C. Harvey
Robert C. Harvey
Chairman of the Board and Chief Executive Officer
OAKRIDGE HOLDINGS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 17, 2004
TO THE SHAREHOLDERS OF COMMON STOCK
OF OAKRIDGE HOLDINGS, INC.
NOTICE IS HEREBY GIVEN, that the Annual Meeting of
Shareholders of Oakridge Holdings, Inc. (the "Company"), will be
held on Friday, December 17, 2004, at 11:00 a.m., local time, at
the law firm of Faegre & Benson LLP, 2200 Wells Fargo Center, 90
South Seventh Street, Minneapolis, Minnesota. The purposes of
the meeting are:
1. To elect five persons to serve as directors of the
Company until the next Annual Meeting of the
Shareholders or until their respective successors shall
be elected and qualified.
2. To ratify the appointment of WIPFLI LLP, formerly known
as Stirtz Bernards Boyden Surdel & Larter, P.A., as the
independent auditors of the Company for the fiscal year
ending June 30, 2005, and
3. To transact such other business as may properly come
before the meeting and at any adjournments or
postponements of the meeting.
The Board of Directors set November 4, 2004, as the record date
for the meeting. This means that shareholders of Company's
common stock, par value $.10 per share, at the close on that date
are entitled to (1) receive notice of the meeting and (2) vote at
the meeting and any adjournments or postponements of the meeting.
We will make available a list of shareholders of the Company
entitled to vote at the meeting for inspection during normal
business hours from November 25, 2004 through December 11, 2004,
at the offices of Stinar HG, Inc., 3255 Sibley Memorial Highway,
Eagan, Minnesota. This list will also be available at the
meeting.
/s/ Robert B. Gregor
By Order of the Board of Directors
Robert B. Gregor
Secretary
Apple Valley, Minnesota
November 11, 2004
TO ENSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE URGED TO
MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY
AS POSSIBLE IN THE POSTAGE-PAID ENVELOPE ENCLOSED FOR THE
PURPOSE. IF A SHAREHOLDER DECIDES TO ATTEND THE MEETING, HE OR
SHE MAY REVOKE THE PROXY AND VOTE THE SHARES IN PERSON.
OAKRIDGE HOLDINGS, INC.
4810 120TH Street West
Apple Valley, Minnesota 55124-8628
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 17, 2004
The Board of Directors of Oakridge Holdings, Inc. (the
"Company") furnishes you with this Proxy Statement to solicit
proxies on its behalf to be voted at the 2004 Annual Meeting of
Shareholders of the Company. The meeting will be held on Friday,
December 17, 2004 at 11:00 a.m., local time, or at any
adjournments or postponements of the Annual Meeting. The Annual
Meeting will be held at the law firm of Faegre & Benson LLP, 2200
Wells Fargo Center, 90 South Seventh Street, Minneapolis, MN.
The proxies also may be voted at any adjournments or
postponements of the meeting.
A shareholder can revoke a proxy by any one of the following
three actions: giving written notice to the Secretary of the
Company, delivering a later dated proxy or voting in person at
the meeting. The mailing address of the principal executive
office of the Company is located at 3255 Sibley Memorial Highway,
Eagan, Minnesota 55121. The date this Proxy Statement is first
being mailed or given to shareholders is November 11, 2004.
The Company will pay the cost of soliciting proxies in the
accompanying form. In addition to solicitation by the use of
mails, certain directors, officers and employees of the Company
may solicit proxies by telephone, telegram, electronic mail or
personal contact, and have requested brokerage firms and
custodians, nominees and other record holders to forward
soliciting materials to the beneficial owners of stock of the
Company. All properly executed written proxies delivered
pursuant to this solicitation (and not revoked later) will be
voted at the meeting in accordance with the directions given in
this proxy. Below is a list of the different votes shareholders
may cast at the meeting pursuant to this solicitation.
- In voting on the election of five directors to serve
until the 2005 Annual Meeting of Shareholders,
shareholders may vote in one of three ways:
(1) in favor of all nominees,
(2) withhold votes as to all nominees, or
(3) withhold votes as to specific nominees.
- In voting on the ratification of the appointment of WIPFLI
LLP as independent auditors, shareholders may vote in one of
the three following ways:
(1) in favor of the proposal,
(2) against the proposal, or
(3) abstain from voting on the proposal.
Shareholders should specify their choice on each matter on the
enclosed proxy. If no instructions given, proxies which are
signed and returned will be voted FOR the election of all
nominees and FOR the proposal to ratify the appointment of WIPFLI
LLP.
The election of directors and all other proposals will
require approval by a majority of the votes cast by the holders
of the shares of Company's common stock, par value $.10 per share
(the "Common Stock"), voting in person or by proxy at the
meeting. Shares represented by a proxy card voted as abstaining
on any of the proposals will be treated as shares present and
entitled to vote that were not cast in favor of a particular
matter, and thus will be counted as votes against the matter.
Thus, abstentions and broker non-votes will not be included in
vote totals and will not affect the outcome of the vote.
Only holders of Common Stock of record at the close of
business on November 4, 2004, are entitled to vote at the meeting
or adjournments or postponements of the meeting. Each owner of
record on the record date is entitled to one vote for each share
of Company Common Stock held. On the record date, 1,431,503
shares of the Company's Common Stock were issued and outstanding.
The presence at the Annual Meeting, in person or by proxy, of the
holders of 20% of the outstanding shares of Common Stock entitled
to vote at the meeting is required for a quorum for the
transaction of business. Holders of shares of Common Stock are
not entitled to cumulate voting rights.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
APPROVAL OF THE PROPOSALS SET FORTH IN THE NOTICE OF MEETING AND
FOR THE ELECTION OF THE NOMINEES FOR DIRECTORS LISTED IN THIS
PROXY STATEMENT.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Board of Directors:
The By-laws of the Company provide that the Board of
Directors (the "Board") will determine the number of directors.
The Board has set its size at five. The Board has nominated the
five individuals below to stand for election as directors of the
Company at the Annual Meeting.
Should any of these nominees become unable to serve for any
reason, or for good cause will not serve, which is not
anticipated, the Board of Directors may designate substitute
nominees. If that occurs, the persons named in the enclosed
proxy will vote proxies that would otherwise be voted for all
named nominees for the election of the substitute nominee or
nominees.
Recommendation of the Board of Directors Concerning the Election
of Directors
The Board of Directors of the Company recommends a vote For
Robert Harvey, Robert Gregor, Hugh McDaniel, Pamela Whitney and
Robert Lindman to hold office until the 2005 Annual Meeting of
Shareholders. Proxies received by the Board of Directors will be
voted FOR all of the nominees unless shareholders specify a
contrary choice in their proxy.
Information about Nominees
The following information has been furnished to the Company,
as of November 11, 2004, by the persons who have been nominated
by the Board to serve as directors for the ensuing year.
Nominees for Age Principal Occupation Director
Election Since
Robert C. Harvey 53 Chairman of the Board, 1992
Chief Executive Officer
and Chief Financial
Officer of the Company and
its wholly owned
subsidiaries
Robert B. Gregor 53 V.P. of Sales and 1993
Marketing of the Company's
wholly owned subsidiary
Hugh McDaniel 65 Real Estate Broker 1992
Pamela Whitney 52 Phillips 66, Inventory 2003
Exchange Supervisor
Robert Lindman 61 Retired, former owner of 2003
Golden Triangle Forms Co.
Other Information about Nominees
Except as indicated below, there has been no change in the
principal occupation or employment of the nominees during the
past five years.
Mr. Harvey has been the Chairman of the Board, Chief
Executive Officer and Chief Financial Officer of the Company and
Stinar HG, Inc. since November 1992, and a director and President
of Oakridge Cemeteries since November 1992.
Mr. Gregor has been V.P. of Marketing and Sales and
Secretary for Stinar H.G. Inc. since January 1, 1999, and prior
to joining Stinar HG, Inc. he was Senior Account Executive at
E.F. Johnson Company since 1993.
Mr. McDaniel is retired Commander of the United States Naval
Reserves and has been a residential real estate broker since
1973.
Ms. Pamela Whitney has been an Inventory Exchange Supervisor
at Phillips 66 since 2000, and prior to joining Phillips 66 was
at the CPA firm of Kilpatrick, Luster & Co., PLLC.
Mr. Robert Lindman is presently retired. Prior to retiring
in 2000, Mr. Lindman was the sole owner of Golden Triangle Forms
Co. for 30 years.
Information about the Board and its Committees
The business and affairs of the Company are managed by the
Board, which met one time in person and once by telephone during
the fiscal year ended June 30, 2004. All of the directors
attended all meetings of the Board. The Board of Directors has
established three committees: the Compensation Committee, the
Corporate Governance Committee and the Audit Committee, each of
which is briefly described below. The Board of Directors has no
other committees.
Compensation Committee
The Compensation Committee reviews and approves the
Company's compensation philosophy and programs covering executive
officers and key management employees. The Committee also
determines compensation of officers and senior employees of the
Company (other than the Chief Executive Officer) and makes
recommendations to the Board of Directors concerning the
compensation of the Chief Executive Officer of the Company. The
Compensation Committee also determines any grants of stock or
stock options. The Compensation Committee did not meet in fiscal
year 2004. The Company's Compensation Committee currently
consists of Robert Lindman, Hugh McDaniel and Pamela Whitney.
Corporate Governance Committee
The Corporate Governance Committee addresses all matters of
corporate governance, evaluates qualifications and candidates for
positions on the Board, evaluates the performance of the Chief
Executive Officer and the Board, and reviews succession plans and
senior management performance. The Corporate Governance
Committee did not meet in fiscal year 2004 and, as a result, the
full Board of Directors nominated the director candidates named
in this Proxy Statement. The Company's Corporate Governance
Committee currently consists of Robert Lindman, Hugh McDaniel and
Pamela Whitney. The Corporate Governance Committee does not have
a charter. The Corporate Governance Committee does not have a
policy with regard to the consideration of director candidates
recommended by shareholders because the size and profile of the
Company make it preferable for identification and evaluation of
potential candidates to occur on a case-by-case basis.
Audit Committee
The Audit Committee meets with management to review the
scope and results of audits performed by the Company's
independent accountants. The Audit Committee also meets with the
independent auditors and with appropriate Company financial
personnel about internal controls and financial reporting. The
Audit Committee is the agent of the Board of Directors in
assuring the adequacy of the Company's financial, accounting and
reporting control processes. The Audit Committee is also
responsible for recommending to the Board of Directors the
appointment of the Company's independent accountants. The Audit
Committee met once in fiscal year 2004 by telephone and all
members of the Audit Committee attended the meeting. The Audit
Committee currently consists of Robert Lindman, Hugh McDaniel and
Pamela Whitney. The Company's Board of Directors will follow the
advice of the Audit Committee on transactions that could have the
potential appearance of not being at arms length transaction.
Securityholder Communications
The Board provides a process for shareholders to send
communications to the Board or any of the directors.
Shareholders may send written communications to the Board of
Directors or specified individual directors by addressing their
communication to Chief Executive Officer, Oakridge Holdings,
Inc., 4820 - 120th Street West, Apple Valley, Minnesota 55124-
8628, by U.S. mail. The communications will be collected by the
Chief Executive Officer and delivered, in the form received, to
the Board or, if so addressed, to a specified director.
The Company does not have a formal policy regarding
attendance by members of the Board of Directors at the Company's
annual meetings of shareholders. The Company has always
encouraged its directors to attend its annual meeting of
shareholders and expects to continue this policy. In 2003, six
Company directors attended the Company's annual meeting of
shareholders.
Certain Relationships and Related Transactions
During fiscal years 2004 and 2003, amounts paid for non-
audit compliance services to entities related to the Chief
Executive Officer were $17,420 and $21,447 respectively.
Direction Compensation
Each non-employee director of the Company is paid a $2,000
annual retainer fee, and all out-of-pocket expenses incurred on
behalf of the Company are reimbursed.
Certain Relationships and Related Transactions
In the ordinary course of business, we may from time to time
engage in transactions with other corporations or individuals
whose officers or directors are also directors of the Company.
In all cases, these transactions are conducted on an arm's length
basis, and none of the transactions requires more specific
disclosure under applicable SEC rules and regulations.
Principal Shareholders and Beneficial Ownership of Management
The following table sets forth information regarding
beneficial ownership of Common Stock on November 4, 2004 by each
person who is a beneficial owner of more than 5% of the Common
Stock issued and outstanding, by each executive officer named in
the Summary Compensation Table, by each director and nominee and
all officers and directors as a group. The address for all
executive officers and directors of the Company is the Company's
business address.
Name Number of shares Percent of
beneficially Class
owned(1)
Robert C. Harvey* 432,012(2) 28.0%
Robert B. Gregor* 197,689(3) 13.0%
Hugh McDaniel* 5,100 0.3%
Pamela Whitney* -- --
Robert Lindman* -- --
Jerry Kenline 215,000(4) 14.3%
All directors and executive 634,801(2,3) 41.3%
officers
as a group (5 persons)
* Indicates directors and executive officers.
(1)Unless otherwise noted, all shares shown are held by persons
possessing sole voting and investment power with respect to
such shares. Shares not outstanding but deemed beneficially
owned by virtue of the right of a person or member or a group
to acquire them within 60 days are treated as outstanding only
when determining the amount and percent owned by such person
or group.
(2)Includes 70,757 shares held by Mr. Harvey's wife and children
in which Mr. Harvey may be deemed to share voting and
investment power, but as to which he disclaims beneficial
ownership. Includes 110,000 shares that could be acquired
upon conversion of a convertible subordinated debenture.
(3)Includes 8,125 shares held by Mr. Gregor's wife and children
in which Mr. Gregor may be deemed to share voting an
investment power, but as to which he disclaims beneficial
ownership. Also, 112,564 are held jointly by Mr. Gregor and
his wife. Includes 35,000 shares that could be acquired upon
exercise of an option and the conversion of the convertible
subordinated debenture.
(4)75,000 of the 215,000 shares total listed in the table are
shares that could be acquired upon exercise of the convertible
subordinated debenture.
Executive Compensation and Other Benefits
Summary of Cash and Certain Other Compensation
The following table sets forth the cash and non-cash
compensation for each of the last three fiscal years awarded to
or earned by the Chief Executive Officer of the Company and each
of the other most highly compensated Executive Officers of the
Company receiving remuneration exceeding $100,000 in fiscal year
2004.
SUMMARY COMPENSATION TABLE
Annual Compensation
Name and Fiscal Other Annual
Principal Position Year Salary Bonus Compensation
(3)
Robert C. 2004 $198,400 - -
Harvey(1) 2003 $189,000 - -
Chairman of the 2002 $180,000 - -
Board, Chief
Executive Officer
and Chief
Financial Officer
Robert B. 2004 $149,659 - $676
Gregor(2) 2003 $121,899 - $260
Secretary and Vice 2002 $130,946 - $283
President of
Marketing and
Sales
(1)Mr. Harvey was first employed by the Company as Chairman of the
Board and Chief Executive Officer in November 1992.
(2)Mr. Gregor was first employed by the Company as Vice President of
Marketing and Sales in January 1, 1999.
(3)Consists of Medical Insurance Payments.
Option Grants and Exercises
The Company did not grant any options to its executive officers
during fiscal year 2004.
AGGREGATE OPTION
EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
Number of Shares Value of
Underlying Unexercised
Unexercised In-The-Money
Options at Fiscal Options
Year-End at Fiscal Year-
End(1)
Shares
Acquired Value
Name On Realiz Exercis Unexercis Exercis Unexercis
Exercise ed able able able able
Robert C. - - - - $- $-
Harvey
Robert B. - - 10,000 - $- $-
Gregor
(1)Value is based on the difference between the per share
average bid and asked prices of the Company's Common Stock on
June 30, 2004 ($0.80 per share) and the exercise price of the
options. At June 30, 2004, all options were out-of-the-money.
Employment Agreements
The Company currently has no employment agreements with its
executive officers.
The Company had a four-year employment agreement contract
with Mr. Harvey, the Chairman, Chief Executive Officer and Chief
Financial Officer of the Company, effective July 1, 2000. Under
the agreement, Mr. Harvey is to receive annual compensation of
$180,000, with annual adjustments of 5% yearly and any incentive
bonus will be decided by the Board of Directors. A new contract
with Mr. Harvey is presently being negotiated.
PROPOSAL NO. 2 -- RELATIONSHIP WITH AND APPOINTMENT OF
INDEPENDENT AUDITORS
The Board of Directors has selected WIPFLI LLP, independent
auditors, to audit the financial statements of the Company for
the year ending June 30, 2005 and recommends that the
shareholders vote for confirmation of such selection.
Confirmation will require the affirmative vote by holders of a
majority of shares present in person or represented by proxy, and
entitled to vote on the matter.
Representatives of WIPFLI LLP are expected to be present at
the Annual Meeting with opportunity to make a statement if they
desire to do so, and are expected to be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR
THE RATIFICATION OF THE APPOINTMENT OF WIPFLI LLP AS THE
COMPANY'S AUDITORS FOR THE FISCAL YEAR ENDING JUNE 30, 2005.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), requires the Company's directors
and executive officers and all persons who beneficially own more
than 10% of the outstanding shares of the Company's Common Stock
to file with the SEC initial reports of ownership and reports of
changes in ownership of the Company's Common Stock. Executive
officers, directors and greater than 10% beneficial owners are
also required to furnish the Company with copies of all Section
16(a) forms they file.
To the company's knowledge based solely on our review of the
forms furnished to us and written representations from certain
reporting persons, we believe that all filing requirements
applicable to our executive officers, directors and persons who
own more than 10% of our common stock were complied with in
fiscal year 2004.
Audit Committee Report
The Audit Committee of the Board of Directors consists of
three members, Hugh McDaniel, Robert Lindman and Pamela Whitney,
all of which are independent as that term is defined in Rule
4200(a) of the National Association of Securities Dealers'
Marketplace Rules.
The Audit Committee assists the Board in overseeing and
monitoring the integrity of the Company's financial reporting
process, its compliance with legal and regulatory requirements
and the quality of its internal and external audit processes.
The Board of Directors has adopted a written charter of the Audit
Committee, which is attached as Appendix A.
Management has primary responsibility for the Company's
financial statements and the overall reporting process, including
its system of internal controls. WIPFLI LLP, the Company's
independent auditors, audits the annual consolidated financial
statements prepared by management and expresses an opinion on
whether those statements fairly present in all material respects
our financial position, results of operations and cash flow under
generally accepted accounting principles.
In fulfilling its responsibilities for the review of the
Audited Consolidated Financial Statements for the year ended June
30, 2004, the Audit Committee:
-Reviewed and discussed the audited consolidated
financial statements for the year ended June 30, 2004
with management and WIPFLI LLP.
-Discussed with WIPFLI LLP the matters required to be
discussed in Statement of Auditing Standards No. 61
regarding communication with audit committees.
-Received written disclosure and the letter from WIPFLI
LLP required by Independence Standards Board No. 1 and
have discussed with the auditors the auditor's
independence.
Based upon this review, the Audit Committee recommended to the
full Board of Directors that the Audited Consolidated Financial
Statements to be included in the Company's Annual Report on Form
10-KSB for the year ended June 30, 2004 filed with the Securities
and Exchange Commission.
THE AUDIT COMMITTEE
ROBERT LINDMAN
HUGH MCDANIEL
PAMELA WHITNEY
Audit Fees
Aggregate fees for professional services rendered for the
Company by WIPFLI LLP, formerly known as Stirtz Bernards Boyden
Surdel & Larter, P.A., for the years ended June 30, 2004, and
2003, were:
Fiscal Fiscal
2004 2003
Audit Fees $47,485 $46,070
Audit-Related Fees - -
Tax Fees - -
All Other Fees - -
Total $47,485 $46,070
The Audit Fees for the years ended June 30, 2004, and 2003,
were the amounts billed for professional services in connection
with the audits of the consolidated financial statements of the
Company and Securities and Exchange quarterly (10-QSB) and yearly
filings (10-KSB).
The de minimis exception was not used for any fees paid to
by WIPFLI LLP.
The Audit Committee has considered whether the provision of
the above services other than audit services is compatible with
maintaining by the independence of WIPFLI LLP.
Preapproval Policies and Procedures
Rules adopted by the Securities and Exchange Commission in
order to implement requirements of the Sarbanes-Oxley Act of 2002
require public company audit committees to pre-approve audit and
non-audit services. All auditing services and non-audit services
provided by WIPFLI LLP must be preapproved by the Audit
Committee. The non-audit services specified in Section 10A(g) of
the Securities Exchange Act of 1934 may not be provided by WIPFLI
LLP.
In addition, the Audit Committee has adopted policies and
procedures pursuant to which audit, audit-related and tax
services, and all permissible non-audit services, are pre-
approved by category of service. The policies require the Audit
Committee to be informed of each service, and the policies do not
include any delegation of the Audit Committee's responsibilities
to management.
SHAREHOLDER PROPOSALS FOR 2005 ANNUAL MEETING
The proxy rules of the Securities and Exchange Commission
permit shareholders, after timely notice to issuers, to present
proposals for shareholder action in issuer proxy statements where
such proposals are consistent with applicable law, pertain to
matters appropriate for shareholder action and are not properly
omitted by issuer action in accordance with the proxy rules. The
Company's annual meeting for the fiscal year ending June 30,
2005, is expected to be held on or about December 31, 2005, and
proxy materials in connection with that meeting are expected to
be mailed on or about November 15, 2005. Except as indicated
below, shareholder proposals prepared in accordance with the
proxy rules must be received by the Company by July 14, 2005 for
inclusion in the proxy statement for the Company's 2005 annual
meeting. Any other shareholder proposal must be received by the
Company at its principal executive office no later than September
18, 2005 in order to be presented at the 2005 annual meeting of
shareholders.
OTHER MATTERS
The management of the Company knows of no matter other than
the foregoing to be brought before the Annual Meeting. However,
if any other matters should properly come before the Annual
Meeting, the persons named in the enclosed proxy card will have a
discretionary authority to vote on the proposal.
Under Minnesota law, each item of business properly
presented at a meeting of shareholders generally must be approved
by the affirmative vote of the holders of a majority of the
voting power of the shares present, in person or by proxy, and
entitled to vote on that item on business. However, if the
shares present and entitled to vote on that item of business
would not constitute a quorum for the transaction of business at
the meeting, then the item must approved by a majority of the
voting power of the minimum number of shares that would
constitute such a quorum. A shareholder who submits votes by
proxy (including, in the case of shares held in street name,
votes directly by brokers at their discretion on certain non-
controversial matters) but does not vote on a specific item of
business is not considered to be present and entitled to vote
with respect to such item of business. On the other hand, a
shareholder who specifically abstains with respect to an item of
business but otherwise gives a proxy authority to vote on the
shareholder's behalf will be counted as being present and
entitled to vote on such item even though the proxy may not be
voted on such item on the shareholder's behalf.
MISCELLANEOUS
THE ANNUAL REPORT OF THE COMPANY FOR THE YEAR ENDED JUNE 30,
2004 IS ENCLOSED HEREWITH. SHAREHOLDERS MAY RECEIVE WITHOUT
CHARGE A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB,
INCLUDING FINANCIAL STATEMENTS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION, BY WRITING TO: CORPORATE SECRETARY, OAKRIDGE
HOLDINGS, INC., 3255 SIBLEY MEMORIAL HIGHWAY, EAGAN, MINNESOTA
55121-1697.
By Order of the Board of Directors
/s/ Robert Gregor
Robert Gregor
Secretary
November 11, 2004
EXHIBIT A
OAKRIDGE HOLDINGS, INC.
AUDIT COMMITTEE CHARTER
Purpose
The Committee will provide assistance to the Board in
fulfilling its oversight responsibility to the shareholders
and others relating to the integrity of the company's
financial statements and the financial reporting process,
the systems of internal accounting and financial controls,
the annual independent audit of the Company's financial
statements, the Company's compliance with legal and
regulatory requirements, and its ethics programs as
established by management and the Board, including the
Company's Code of Business Conduct. The Committee shall
also oversee the independent auditors' qualifications and
independence. The Committee will evaluate the performance
of the Company's internal controls and independent auditors,
including a review and evaluation of the engagement partner.
In so doing, it is the responsibility of the Committee to
maintain free and open communication between the Committee,
independent auditors, the internal auditors and management
of the Company.
Committee Membership
The Committee shall be appointed by the Board and shall
comprise at least three directors. Each Committee member
shall meet the requirements of the Stock Exchange listing
standards, and federal laws and regulations, with respect to
audit committees, as they may become applicable from time to
time, as well as the requirements of the Company's Corporate
Governance guidelines. No member may serve on the audit
committees of more than two public companies. Committee
members may receive no compensation from the Company other
than director's fees. All Committee members will be
financially literate, and at least one member of the
Committee will have accounting or related financial
management expertise as determined by the Board. The Board
will designate a Chairman for the Committee.
Committee Authority and Responsibilities
The primary responsibility of the Committee is to oversee
the Company's financial controls and reporting processes on
behalf of the Board and report the results of its activities
to the Board. Management is responsible for preparing the
Company's financial statements, and the independent auditors
are responsible for auditing those financial statements.
The committee in carrying out its responsibilities believes
its policies and procedures should remain flexible, in order
to best react to changing conditions and circumstances. The
Committee should take the appropriate actions to set the
overall corporate "tone" for quality financial reporting,
sound business risk practices, and ethical behavior.
The following shall be the principal recurring processes of
the Committee in carrying out its oversight
responsibilities. The Committee may perform such other
duties and responsibilities as are consistent with its
purpose and as the Board or the Committee deems appropriate.
1. Independent auditors. The Committee shall have a clear
understanding with
management and the independent auditors that the
independent auditors are ultimately accountable to the
Board and the Committee, as representatives of the
Company's shareholders. The Committee shall have the
sole authority and responsibility to hire, evaluate
and, where appropriate, replace the independent
auditors and, in its capacity as a committee of the
Board, shall be directly responsible for the
appointment, compensation and oversight of the work of
the independent auditors. The Committee shall discuss
the auditors' independence from management and the
Company, including whether the auditors' performance of
permissible non-audit services is compatible with their
independence. This process will include, at least
annually, the Committee's review of the independent
auditors' internal control procedures, any material
issues raised by the most recent internal quality-
control review, or peer review, of the independent
auditors, or by any inquiry or investigation by
governmental or professional authorities, within the
preceding five years, respecting one or more
independent audits carried out by the independent
auditors, and any steps taken to deal with any such
issues; and (to assess the auditors' independence) all
relationships between the independent auditors and the
Company. Annually, the Committee will review the
qualifications and performance of the Company's current
independent auditors and select the Company's
independent auditors for the next year, subject to
shareholder ratification.
2. Audit services. The Committee shall discuss with the
independent auditors the
overall scope and plans for their respective audits
including their respective responsibilities. The
Committee shall approve in advance all audit engagement
fees and the terms of all audit services to be provided
by the independent auditors.
3. Permissible non-audit services. The Committee shall
establish policies and
procedures for the engagement of the independent
auditors to provide permissible non-audit services,
which shall include pre-approval of permissible non-
audit services to be provided by the independent
auditors. The Committee shall approve in advance all
permissible non-audit services to be provided by the
independent auditors.
4. Review of interim financial statements; earnings
releases. The Committee Chairman shall review the interim
financial statements, and the Company's disclosures under
Management's Discussion and Analysis of Financial Condition
and Results of Operations, with management and the
independent auditors prior to the filing of the Company's
Quarterly Report on Form 10-QSB. The Committee will discuss
the Company's policies and procedures with respect to
earnings releases, financial information and earnings
guidance provided to analysts and rating agencies. The
Committee will discuss the results of the quarterly review
and any other matters required to be communicated to the
Committee by the independent auditors under generally
accepted auditing standards. The Chairman of the Committee
may represent the entire Committee for the purposes of this
review.
5. Review of annual audited financial statements. The
Committee Chairman shall review with management and the
independent auditors the financial statements to be included
in the Company's Annual Report on Form 10-KSB, including (a)
their judgment about the quality, not just acceptability, of
the Company's accounting principles, including significant
financial reporting issues and judgments made in connection
with the preparation of the financial statements; (b) the
clarity of the disclosures in the financial statements; and
(c) the Company's disclosures under Management's Discussion
and Analysis of Financial Condition and Results of
Operations, including critical accounting policies.
The Chairman of the Committee will also review with
management and the independent auditors (a) major
issues regarding accounting principles and financial
statement presentations, including significant changes
in the selection or application of accounting
principles; (b) major issues regarding the adequacy of
internal controls and steps taken in light of material
deficiencies; and (c) the effects of alternative
accounting methods and regulatory and accounting
initiatives on the financial statements. The Chairman
of the Committee will discuss the results of the annual
audit and any difficulties the independent auditors
encountered in the course of their audit work,
including any restrictions on the scope of the
auditors' activities or on access to requested
information, and any significant disagreements with
management. The Chairman of the Committee will also
discuss any other matters required to be communicated
to the Committee by the independent auditors under
generally accepted auditing standards, and the annual
report on internal controls by the Chief Executive
Officer and Chief Financial Officer, as received by the
independent auditors.
Based on these reviews, the Committee will make a
recommendation to the board as to whether the audited
financial statements should be included in the
Company's Annual Report on Form 10-KSB.
6. Internal controls; disclosure controls and procedures.
The Committee will review
and discuss with management, and the independent
auditors the Company's internal controls. The
Committee will review and discuss the Company's
disclosure controls and procedures, and the quarterly
assessments of such controls and procedures by the
Chief Executive Officer and Chief financial Officer.
7. Complaint procedures. The Committee will establish
procedures for handling
complaints regarding accounting, internal accounting
controls, and auditing matters, including procedures
for confidential, anonymous submission of concerns by
employees regarding accounting and auditing matters.
8. Compliance programs. The Committee will review and
discuss with
management, the independent auditors the adequacy and
effectiveness of the Company's Code of Business
Conduct.
9. Report for inclusion in proxy statement. The Committee
shall prepare the report
that SEC rules require to be included in the Company's
annual proxy statement.
10. Hiring of auditor personnel. The Committee shall set
clear hiring policies with
regard to employees and former employees of the
independent auditors.
11. Charter. The Committee shall periodically review and
reassess the adequacy of
this Charter and recommend any proposed changes to the
Board for approval.
12. Annual performance evaluation. The Committee shall
annually review its own
performance.
13. Investigative authority. In discharging its oversight
role, the Committee is
empowered to investigate any matter brought to its
attention with full access to all books, records,
facilities and personnel of the Company.
Outside Advisors
The Committee with the authority of the chairman of the
board shall have the authority to retain such outside
counsel, accountants, experts and other advisors as it deems
appropriate to assist the Committee in the performance of
its functions.
Meetings
The Committee will meet as often as may be deemed necessary
or appropriate in its judgment, at least semi-annually each
year, and at such times and places as the Committee shall
determine. The majority of the members of the Committee
shall constitute a quorum. The Committee will meet
separately, at least semi-annually, with the independent
auditors, and management to discuss any matters that they
wish to bring to the Committee's attention.
The Committee shall report to the Board with respect to its
meetings, including any issues that arise with respect to
the quality or integrity of the Company's financial
statements, the Company's compliance with legal or
regulatory requirements, the performance and independence of
the Company's independent auditors, or the performance of
the internal audit function.