ACE CASH EXPRESS, INC.
1231 Greenway Drive, Suite 800
Irving, Texas 75038
------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be Held November 17, 2000
------------------------------
ACE Cash Express, Inc. (the "Company") will hold its 2000 Annual
Meeting of Shareholders at the Dallas Marriott Las Colinas, 223 West Las Colinas
Boulevard, Irving, Texas 75039, on Friday, November 17, 2000. The meeting will
begin at 10:00 a.m. At the meeting, the shareholders will be asked to:
o Elect seven directors.
o Vote upon a proposal to increase the shares authorized for
issuance under the Company's 1997 Stock Option Plan.
o Consider any other business properly presented at the meeting.
Shareholders of record at the close of business on September 29, 2000,
may vote at the meeting. A list of those shareholders may be reviewed at the
Company's offices at 1231 Greenway Drive, Suite 800, Irving, Texas 75038, for
ten days before the meeting.
Whether or not you plan to attend the meeting, please date and sign the
enclosed proxy and return it in the accompanying postage-prepaid envelope. If
you attend the meeting and wish to vote in person, you may do so.
By order of the Board of Directors,
Debra A. Bradford
Secretary
Irving, Texas
October 17, 2000
ACE CASH EXPRESS, INC.
PROXY STATEMENT
For
ANNUAL MEETING OF SHAREHOLDERS
To Be Held November 17, 2000
----------------------------
This Proxy Statement is furnished to shareholders of ACE Cash Express,
Inc., a Texas corporation (the "Company"), to solicit, on behalf of the
Company's Board of Directors, proxies to vote at the Annual Meeting of
Shareholders of the Company to be held November 17, 2000 (the "Annual Meeting").
Proxies in the form enclosed will be voted at the Annual Meeting if properly
executed, returned to the Company before the Annual Meeting, and not revoked.
This Proxy Statement and the enclosed proxy form are first being sent to
shareholders on or about October 17, 2000.
Accompanying this Proxy Statement is a copy of the Company's Annual
Report to Shareholders for the fiscal year ended June 30, 2000 ("fiscal 2000").
The Annual Report to Shareholders is not part of the proxy solicitation
material.
TABLE OF CONTENTS PAGE
Outstanding Capital Stock............................................................... 2
Quorum and Voting....................................................................... 2
Solicitation of Proxies..................................................................2
Action to be Taken at Meeting............................................................2
Revocation of Proxies....................................................................3
Security Ownership of Certain Beneficial Owners and Management...........................4
Directors and Executive Officers.........................................................6
Board of Directors..............................................................6
Director Nominees...............................................................6
Board Committees................................................................7
Board and Committee Meetings....................................................8
Director Compensation...........................................................8
Compliance with Section 16(a) of the Securities Exchange Act of 1934............9
Executive Officers.............................................................10
Executive Compensation..................................................................11
Summary Compensation Table.....................................................11
Senior Management Bonus Plan...................................................11
Stock Options..................................................................12
Compensation Committee Interlocks and Insider Participation....................13
Compensation Committee Report on Executive Compensation........................13
Change-in-Control Severance Agreements.........................................15
Certain Relationships..........................................................16
Stock Performance Chart.................................................................17
Proposal to Amend ACE Cash Express, Inc. 1997 Stock Option Plan.........................17
Background and Summary of Terms................................................17
Tax Status of Stock Options....................................................19
Required Vote..................................................................20
Relationship with Independent Public Accountants........................................20
Shareholder Proposals for 2001 Annual Meeting...........................................20
Miscellaneous...........................................................................21
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OUTSTANDING CAPITAL STOCK
The record date for shareholders entitled to vote at the Annual Meeting
is September 29, 2000. At the close of business on that date, there were
9,955,963 shares of Common Stock, $.01 par value per share, of the Company
("Common Stock") outstanding.
QUORUM AND VOTING
The presence, in person or by proxy, of the holders of a majority of
all outstanding shares of the Common Stock on the record date is necessary to
constitute a quorum at the Annual Meeting. Assuming the presence of a quorum:
o A plurality of the votes cast at the Annual Meeting, in person
or by proxy, is required for the election of directors; and
o A majority of the votes cast at the Annual Meeting, in person
or by proxy, is required to approve the proposal to amend the
Company's 1997 Stock Option Plan or any other matter.
Each shareholder is entitled to one vote, in person or by proxy, for
each share of Common Stock held in such shareholder's name on the record date.
Because the seven nominees for director who receive the most votes will be
elected, any abstention will not be included in the vote totals. Regarding any
other proposal, an abstention will be included in vote totals and will have the
same effect as a negative vote. Where brokers who are nominee record holders do
not vote on specific matters because they did not receive specific instructions
on such matters from the beneficial owners of such shares ("broker non-votes"),
such broker non-votes will not be included in vote totals and will have no
effect on the election of directors or any other proposal.
SOLICITATION OF PROXIES
The accompanying proxies are solicited on behalf of the Board of
Directors. The Company will pay all expenses of soliciting these proxies.
Proxies may be solicited not only by mail, but also by personal interview,
telephone, and electronic transmission by the Company's directors, officers, and
employees. Arrangements may also be made with brokerage houses and other
custodians, nominees, and fiduciaries to forward solicitation material to the
beneficial owners of shares of Common Stock held of record by such persons, and
the Company may reimburse them for the corresponding reasonable out-of-pocket
expenses.
ACTION TO BE TAKEN AT MEETING
When shareholders have appropriately specified how their proxies should
be voted, the proxies will be voted accordingly. Unless the shareholder
otherwise specifies therein, the proxies will be voted:
o FOR the election as directors of the Company of the seven
nominees named below under "Directors and Executive Officers
--Director Nominees"; and
o FOR the proposal to increase the number of shares of Common
Stock authorized for issuance under the Company's 1997 Stock
Option Plan.
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If any other matter or business is properly presented at the meeting,
the proxies will be voted at the discretion of the proxy holders, in accordance
with their best judgment. On the date of this Proxy Statement, the Board of
Directors does not know of any other matter or business to be presented at the
Annual Meeting other than as addressed in this Proxy Statement.
REVOCATION OF PROXIES
A proxy may be revoked any time before it is exercised. A shareholder
giving a proxy may revoke it by:
o sending in another proxy with a later date;
o giving written notice to the Company's Secretary before the
Annual Meeting that the proxy has been revoked; or
o voting in person at the Annual Meeting.
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SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Common Stock as of September 29, 2000, by each
person the Company knows to beneficially own more than 5% of the outstanding
Common Stock, each of the Company's directors, the Named Executive Officers (as
defined in "Executive Compensation -- Summary Compensation Table" below), and
all directors and executive officers as a group. The Company believes each such
shareholder has sole voting and dispositive power over the shares held, except
as otherwise indicated.
Shares of Common Percentage of Common
Stock Beneficially Owned Stock Beneficially Owned
---------------------------- -------------------------
Raymond C. Hemmig 689,437 (1) 6.9%
10000 N. Central Expressway, Suite 1060
Dallas, Texas 75231
Donald H. Neustadt 901,631 (2) 9.1%
1231 Greenway Drive, Suite 800
Irving, Texas 75038
Howard W. Davis 25,249 (3) (10)
Marshall B. Payne 235,588 (4) 2.4%
Edward W. Rose III 1,114,905 (5) 11.2%
500 Crescent Court, Suite 250
Dallas, Texas 75201
Jay B. Shipowitz 52,500 (6) (10)
Charles Daniel Yost 29,749 (7) (10)
Raymond E. McCarty 179,493 (8) 1.8%
Debra A. Bradford 4,311 (9) (10)
Greenbriar Partners, Ltd. 828,482 (11) 8.3%
1901 North Akard
Dallas, Texas 75201
Robert Fleming Inc. 581,886 (12) 5.8%
320 Park Avenue, 11th Floor
New York, NY 10022
Wanger Asset Management, L.P. 765,000 (13) 7.7%
227 West Monroe, Suite 3000
Chicago, IL 60606
All directors and executive officers as a 3,232,863(14) 32.5%
group (9 persons)
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(1) Includes 11,250 shares Mr. Hemmig holds as custodian for his children,
11,250 shares held for the Hemmig Family Trust and options to purchase
24,637 shares exercisable within 60 days of the date of this Proxy
Statement.
(2) Includes 56,750 shares held by KLN Foundation, a private charitable
foundation of which Mr. Neustadt is one of three officers. Mr. Neustadt
shares voting and dispositive power with those other foundation officers.
Mr. Neustadt disclaims beneficial ownership of the shares held by KLN
Foundation. Also includes options to purchase 17,712 shares exercisable
within 60 days of the date of this Proxy Statement.
(3) Includes options to purchase 18,499 shares exercisable within 60 days of
the date of this Proxy Statement.
(4) Includes 24,120 shares owned by Scout Ventures, a Texas general partnership
of which Mr. Payne is a general partner ("Scout"); Mr. Payne shares voting
and dispositive power over the shares held by Scout with the other partners
of Scout. Also includes options to purchase 25,249 shares exercisable
within 60 days of the date of this Proxy Statement.
(5) Includes 894,005 shares of Common Stock owned by Mr. Rose and options to
purchase 25,249 shares exercisable within 60 days of the date of this Proxy
Statement. Also includes shares owned by the following persons:
a) Evelyn P. Rose, the wife of Mr. Rose - 115,341 shares
b) Lela Helen Rose, the daughter of Mr. and Mrs. Rose - 21,705 shares
c) William E. Rose, the son of Mr. and Mrs. Rose - 21,705 shares
d) Kaiser-Francis Oil Company - 27,675 shares.
e) Ruth Kaiser Nelson - 9,225 shares.
Mr. Rose might be considered to share dispositive power with each of these
persons over the shares of Common Stock owned by that person. Mr. Rose,
however, disclaims beneficial ownership of any of the shares owned by each
of these persons.
(6) Includes options to purchase 48,100 shares exercisable within 60 days of
the date of this Proxy Statement.
(7) Consists of options to purchase 29,749 shares exercisable within 60 days of
the date of this Proxy Statement.
(8) Includes options to purchase 19,347 shares exercisable within 60 days of
the date of this Proxy Statement.
(9) Consists of options to purchase 4,311 shares exercisable within 60 days of
the date of this Proxy Statement.
(10) Less than 1%.
(11) Includes 4,500 shares held by Mr. Frederick E. Rowe, Jr., the general
partner of Greenbriar Partners, Ltd. ("Greenbriar"). As general partner,
Mr. Rowe has the power to manage Greenbriar's operations, including the
shared right with Greenbriar to vote and dispose of the 808,982 shares of
Common Stock Greenbriar holds. Mr. Rowe has sole voting and dispositive
power over the 4,500 shares he holds. Also includes an additional 15,000
shares owned by the Rowe Family Partnership, of which Mr. Rowe is a general
partner.
(12) Robert Fleming Inc. is a registered investment adviser with shared voting
and dispositive power over these shares.
(13) Wanger Asset Management, L.P. ("WAM") is a registered investment adviser,
the general partner of which is Wanger Asset Management, Ltd. These shares
have been acquired on behalf of discretionary clients of WAM. One of those
clients is Acorn Investment Trust ("Acorn"), which beneficially owns
750,000 of these shares. Acorn's address is the same as the address of WAM
and its general partner. WAM and its general partner have shared voting and
dispositive power over all of these shares. Acorn has shared voting and
dispositive power over its 750,000 shares.
(14) See Notes (1) through (9).
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DIRECTORS AND EXECUTIVE OFFICERS
BOARD OF DIRECTORS
Seven directors are to be elected at the Annual Meeting. Each nominee
will be elected to hold office until the next annual meeting of shareholders or
until his successor is elected and qualified. Proxy holders will not be able to
vote the proxies held by them for more than seven persons. To be elected a
director, each nominee must receive a plurality of all of the votes cast at the
Annual Meeting for the election of directors. Should any nominee become unable
or unwilling to accept nomination or election, the proxy holders may vote the
proxies for the election, in his stead, of any other person the Board of
Directors may recommend. Each nominee, other than Michael S. Rawlings, is
currently a director of the Company. Mr. Howard W. Davis, who has been a
director since 1995, has determined, for personal reasons, not to stand for
re-election. Each nominee has expressed his intention to serve the entire term
for which election is sought.
DIRECTOR NOMINEES
Raymond C. Hemmig, age 50, has served as the Chairman of the Board of
the Company since September 1988, when he first became a director. From
September 1988 to October 1994, Mr. Hemmig also served as the Company's Chief
Executive Officer. Mr. Hemmig served as a director of the National Association
of Check Cashers and was the founding President of the Texas Association of
Check Cashers, Inc. Since June 1994, Mr. Hemmig also has served as a director of
Restoration Hardware, Inc., a publicly held retail company. Since December 1995,
Mr. Hemmig has served as the Chairman of the Board and Chief Executive Officer
of Retail & Restaurant Growth Capital L.P., a licensed Small Business Investment
Corporation and a provider of financing to emerging retail and restaurant
companies. Mr. Hemmig also serves as a director of various private companies.
From 1990 until May 1994, Mr. Hemmig served as a director of On The Border
Cafes, Inc., a publicly held restaurant chain. From 1985 to September 1988, Mr.
Hemmig was a partner and co-founder of Hemmig & Martin, a consulting firm to
clients in the food service, retail, and franchise industries.
Donald H. Neustadt, age 51, has served as the Chief Executive Officer
of the Company since November 1994 and as a director of the Company since
January 1987. Mr. Neustadt served as the Company's President from November 1994
to December 1999. Mr. Neustadt served as the Company's President and Chief
Operating Officer from January 1987 to November 1994. From 1972 to January 1987,
Mr. Neustadt served in various capacities with Associates Corporation of North
America ("Associates NA") and its affiliates, including as President of
Associates Financial Express, Inc. ("Associates Financial"), a money order
company; as Senior Vice President and Controller of Associates Diversified
Services, Inc., which owned a consumer credit card bank, a savings and loan and
Associates Financial; as Vice President of Strategic Planning for Associates NA;
and as Controller of Consumer Operations and a systems manager for Associates
Financial Services, a consumer finance company. Mr. Neustadt also currently
serves as a director of a private company.
Jay B. Shipowitz, age 37, has served as the President and Chief
Operating Officer and as a director of the Company since January 2000. Mr.
Shipowitz served as the Company's Senior Vice President and Chief Financial
Officer from May 1997 to January 2000. Prior to joining ACE, from July 1996 to
May 1997, Mr. Shipowitz was the senior vice president and chief financial
officer of USDATA Corporation, a software company located in Richardson, Texas.
From June 1993 to July 1996, Mr. Shipowitz was the vice president of finance and
administration and chief financial officer of Westinghouse Security Systems,
Inc., a residential security company headquartered in Dallas, Texas. From 1987
to 1993, Mr. Shipowitz worked at Price Waterhouse in Baltimore, Maryland, in
various
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positions, the last of which was senior manager. Mr. Shipowitz worked at KPMG
Peat Marwick in Greensboro, North Carolina from 1985 to 1987. Mr. Shipowitz is a
director of Financial Service Centers of America, Inc. (the successor
organization to the National Association of Check Cashers), and a director of a
private company.
Marshall B. Payne, age 43, has served as a director of the Company
since 1987. Since 1983, Mr. Payne has been Vice President of Cardinal Investment
Company, Inc., an investment management firm. In addition, he serves as a
director of Restoration Hardware, Inc., a publicly held retail company, as a
director of LBP, Inc., formerly engaged in the manufacturing of home improvement
products, and as a director of various private companies.
Michael S. Rawlings, age 46, is a nominee for director of the Company.
Since June 1997, Mr. Rawlings has been the President of Pizza Hut, Inc. For the
previous 18 years, Mr. Rawlings worked in various positions, the last of which
was Chief Executive Officer of the Dallas Group of DDB Needham Worldwide, a
large marketing communications agency.
Edward W. Rose, III, age 59, has served as a director of the Company
since 1987. Since 1974, Mr. Rose has been the President and sole shareholder of
Cardinal Investment Company, Inc. In addition, Mr. Rose serves as Chairman of
the Board of Drew Industries, Inc., an aluminum window manufacturer, and of LBP,
Inc., formerly engaged in the manufacturing of home improvement products, and as
a director of various private companies.
Charles Daniel Yost, age 51, has served as a director of the Company
since August 1996. In March 1998, Mr. Yost joined Allegiance Telecom, Inc. as
President and Chief Operating Officer. From July 1997 to March 1998, Mr. Yost
was President and Chief Operating Officer of NETCOM On-line Communications
Systems, Inc., an Internet service provider. From 1994 to 1997, Mr. Yost served
as President of the Southwest Region of AT&T Wireless Services, Inc., a provider
of cellular telephone service. From 1991 to June 1994, Mr. Yost served as
President of the Southwest Region for McCaw Cellular Communications/LIN
Broadcasting. In addition, Mr. Yost serves as a director of a privately held
architectural services provider.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE
ELECTION OF EACH NOMINEE.
BOARD COMMITTEES
The Board of Directors of the Company has two permanent committees: the
Audit Committee and the Compensation Committee. None of the directors who serve
as members of either permanent committee are employees of the Company or any of
its subsidiaries. The Company has no nominating committee or committee that
recommends qualified candidates to the Board of Directors for election as
directors. The entire Board of Directors is responsible for selecting nominees
for election as directors.
The Audit Committee's functions include:
o Engaging auditors and determining their compensation;
o Making recommendations to the Board of Directors for
reviewing the completed audit and audit report with the
independent auditors, the conduct of the audit, significant
accounting adjustments, recommendations for improving
internal controls, and all other significant findings during
the audit;
-7-
o Meeting periodically with the Company's management and
auditors to discuss internal accounting and financial
controls; and
o Initiating and supervising any special investigation it
deems necessary regarding the Company's accounting and
financial policies and controls.
Messrs. Rose (Chairman) and Yost are the Audit Committee members.
The Compensation Committee's functions include:
o Establishing and administering the Company's compensation
policies;
o Administering the Company's 1997 Stock Option Plan and the
Company's Non-Employee Directors Stock Option Plan (the
"Directors Option Plan"), and administering the remaining
options outstanding under the Company's 1987 Stock Option
Plan (under which no more options may be granted); and
o Overseeing the administration of other employee benefit
plans and fringe benefits paid to or provided for the
Company's officers. See "Executive Compensation --
Compensation Committee Report on Executive Compensation."
Messrs. Davis (Chairman) and Payne are the Compensation Committee members.
BOARD AND COMMITTEE MEETINGS
The Board of Directors held five meetings during fiscal 2000. Each of
the Audit Committee and the Compensation Committee held two meetings during
Fiscal 2000. All persons who were directors during fiscal 2000 attended at least
75% of the total of the Board meetings and the meetings of committee on which
they served.
DIRECTOR COMPENSATION
Each non-employee director (currently each director other than Messrs.
Hemmig, Neustadt and Shipowitz) receives $1,250 per calendar quarter as a
retainer, $1,500 for attendance at each Board of Directors meeting, and $500 for
attendance at each meeting of a committee of the Board of Directors that is not
held in conjunction with a Board of Directors meeting, and is reimbursed
expenses related to his activities as a director. The Company does not
compensate its employees for service as a director.
Under the Directors Option Plan:
o Each non-employee director elected to the Board of Directors
who has not previously served as a director of the Company
is automatically granted, on the date of his election, an
option to purchase 11,250 shares of Common Stock; and
o Each non-employee director serving on December 1 of each
year is automatically granted an option on that date to
purchase 5,000 shares of Common Stock.
The number of shares subject to the automatic annual grant from December 1, 1995
through December 1, 1997 was 6,750; on August 17, 1998, the Board of Directors
reduced that number to 5,000, beginning December 1, 1998. The Directors Option
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Plan requires that the exercise price of each option must be equal to the
closing price of the Common Stock on The Nasdaq Stock Market on the date the
option is granted.
Under the Directors Option Plan:
o An option to purchase 11,250 shares of Common Stock at an
exercise price of $3.66 per share was granted to Mr. Davis
in March 1995 relating to his election to the Board of
Directors;
o Each of Mr. Davis, Mr. Payne, and Mr. Rose was granted an
option to purchase 6,750 shares of Common Stock at an
exercise price of $4.11 per share on December 1, 1995;
o An option to purchase 11,250 shares of Common Stock at an
exercise price of $5.56 per share was granted to Mr. Yost
when he was elected to the Board of Directors in August
1996;
o Each of Mr. Davis, Mr. Payne, Mr. Rose, and Mr. Yost was
granted an option to purchase 6,750 shares of Common Stock
at an exercise price of $7.00 per share on December 1, 1996;
o Each of Mr. Davis, Mr. Payne, Mr. Rose, and Mr. Yost was
granted an option to purchase 6,750 shares of Common Stock
at an exercise price of $12.42 per share on December 1,
1997;
o Each of Mr. Davis, Mr. Payne, Mr. Rose, and Mr. Yost was
granted an option to purchase 5,000 shares of Common Stock
at an exercise price of $13.25 per share on December 1,
1998; and
o Each of Mr. Davis, Mr. Payne, Mr. Rose, and Mr. Yost was
granted an option to purchase 5,000 shares of Common Stock
at an exercise price of $16.375 per share on December 1,
1999.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors, executive officers, and
holders of more than 10% of the Common Stock to file with the Securities and
Exchange Commission ("SEC") reports of ownership changes in ownership of Common
Stock. SEC regulations require those directors, executive officers, and greater
than 10% shareholders to furnish the Company with copies of all Section 16(a)
forms they file.
Based on the Company's review of reports and on written representations
that no other reports were required during fiscal 2000, the Company believes
that the directors, executive officers, and greater than 10% shareholders
complied with all applicable Section 16(a) filing requirements, except Raymond
E. McCarty, who filed a late Form 4 for March 2000 to report a sale of 1,800
shares.
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EXECUTIVE OFFICERS
NAME POSITION
---- --------
Raymond C. Hemmig Chairman of the Board
Donald H. Neustadt Chief Executive Officer
Jay B. Shipowitz President and Chief Operating Officer
Raymond E. McCarty Executive Vice President - Operations
President - ACE Franchise Group
Debra A. Bradford Senior Vice President, Chief Financial Officer,
Secretary and Treasurer
See "-- Directors" above for business experience information concerning Messrs.
Hemmig, Neustadt and Shipowitz.
Raymond E. McCarty, age 58, has served as the Company's Executive Vice
President - Operations since January 2000 and as president of the ACE Franchise
Group since April 1996. Previously, Mr. McCarty served as Senior Vice President
- - - Operations of the Company since 1985. Prior to his service with the Company,
Mr. McCarty was the division vice president of Associates NA. While at
Associates NA, Mr. McCarty was responsible for organizing Associates NA's first
home improvement loan portfolio acquisition and for establishing an automobile
lending program. From 1963 to 1982, Mr. McCarty served in various capacities
with an affiliate of Barclays American Corporation, including director of a
seven-state region.
Debra A. Bradford, age 41, has served as the Company's Senior Vice
President and Chief Financial Officer since January 2000. Ms. Bradford joined
ACE in May 1999 as the Vice President of Finance. From 1984 until 1999, Ms.
Bradford held managerial positions at First Data Corporation, including chief
operating officer of IPS Card Solutions, vice president of finance, and
controller.
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EXECUTIVE COMPENSATION
Annual Compensation Long-Term Compensation
----------------------------------- -------------------------------------
Awards Payouts
--------------------------- ---------
Other
Year Annual Restricted Securities LTIP All Other
Ended Compensation Stock Underlying Payouts Compensation
Name and Principal Position June Salary Bonus ($) (1) Awards (S) Options/SARs ($) ($)
30, ($) ($) (#)
- - ---------------------------- -------- ---------- --------- -------------- ----------- --------------- --------- --------------
Donald H. Neustadt 2000 308,014 0 13,144 - 11,686 - -
(Chief Executive 1999 273,563 212,911 13,654 - 10,275 - -
Officer) 1998 248,012 166,700 13,654 - 16,458 - -
Jay B. Shipowitz 2000 218,870 0 13,539 - 107,775 - -
(President and 1999 167,222 104,447 13,823 - 6,710 - -
Chief Operating Officer) 1998 150,275 84,900 13,823 - 9,955 - -
Raymond E. McCarty 2000 200,749 0 13,144 - 7,496 - -
(Executive Vice 1999 171,866 106,931 13,812 - 6,703 - -
President - Operations) 1998 155,812 83,200 13,812 - 10,618 - -
Debra A. Bradford 2000 146,875 0 10,144 - 33,497 - -
(Senior Vice President, 1999(2) 17,769 0 0 - 11,250 - -
Chief Financial Officer - - -
Secretary and Treasurer)
- - ----------------------------------------------
(1) Includes a cash car allowance of $9,000 annually.
(2) Ms. Bradford commenced her employment with the Company as Vice President of
Finance on May 17, 1999 at an annual salary of $140,000.
SENIOR MANAGEMENT BONUS PLAN
The compensation table above includes bonuses paid under the Senior
Management Bonus Plan (the "Bonus Plan"). Under the Bonus Plan, bonuses are
payable to the Named Executive Officers and other members of management selected
to participate by the Compensation Committee of the Board of Directors if
certain targets for the Company's financial performance, also determined by the
Compensation Committee (and approved by the Board of Directors), are achieved in
a fiscal year. For fiscal 2000, target bonuses were payable if the Company
achieved a 25% increase in pre-tax earnings for fiscal 2000 compared to the
preceding fiscal year, though bonuses would have begun to be payable upon a 15%
increase in pre-tax earnings. The bonus pool was established at a total of
$440,000, which would have been 3% of the Company's targeted pre-tax earnings
(determined without accrual of bonus payments), and the pool would have
increased by $26,000 for each 1% increase in pre-tax earnings over the targeted
increase in pre-tax earnings of 25%. For fiscal 2000, the Company did not
achieve the minimum required increase in pre-tax earnings, and no bonuses were
paid or accrued. See "Compensation Committee Report on Executive Compensation."
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STOCK OPTIONS
The following table provides information on stock option grants to the
Named Executive Officers under the Company's 1997 Stock Option Plan (the "1997
Option Plan") during fiscal 2000:
Potential Realizable Value
at Assumed Annual Rates of
Stock Price Appreciation
Individual Grants for Option Term (2)
- - ---------------------------------------------------------------------------------------------------- ----------------------------
Number of % of Total
Securities Options/SARs
Underlying Granted to Exercise or
Options/SARs Employees in Base Price Expiration
Name (#) Fiscal Year ($/Sh) Date 5% ($) (3) 10% ($)(3)
- - ---------------------------- ---------------- ---------------- ------------- ------------- ------------ -----------
Donald H. Neustadt(1) 11,686 2.39 13.75 8/16/09 101,052 256,087
Jay B. Shipowitz(1) 7,775 1.59 13.75 8/16/09 67,233 170,381
100,000 20.43 17.00 1/3/10 1,069,121 2,709,362
Raymond E. McCarty(1) 7,496 1.53 13.75 8/16/09 64,820 164,267
Debra A. Bradford(1) 5,997 1.23 13.75 8/16/09 51,858 131,418
27,500 5.62 17.00 1/3/10 294,008 745,075
(1) Options become exercisable in four equal annual installments. The exercise
price of each option is equal to the closing price per share of the Common
Stock on The Nasdaq Stock Market on the date the option was granted. Each
option was granted under the 1997 Option Plan.
(2) The values shown in these columns reflect growth rate assumptions the SEC
prescribes. Actual gains, if any, on stock option exercises and Common
Stock holdings are dependent on the Common Stock's future performance and
overall stock market conditions. There can be no assurance that the amounts
reflected in this table will be achieved.
(3) These values represent the difference between the assumed appreciation in
the Common Stock's market value at the date of grant and the exercise price
of the options.
The following table provides information on the stock options/SARs that
the Named Executive Officers held at June 30, 2000:
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs at
Shares Value Realized at FY-End (#) FY-End ($)*
------------- -----------
Acquired on ($) Exercisable/ Exercisable/
Name Exercise (#) Unexercisable Unexercisable
- - -------------------------- -------------- --------------- ------------------- --------------------
Donald H. Neustadt 0 0 10,797/27,622 4,707/4,707
Jay B. Shipowitz 2,500 25,469 43,504/117,786 170,132/2,650
Raymond E. McCarty 3,938 48,536 14,822/17,833 52,526/2,939
Debra A. Bradford 0 0 2,812/41,935 0/0
- - --------------------------
* Based on the closing price on The Nasdaq Stock Market of the Common
Stock on June 30, 2000 of $11.875 per share.
-12-
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Howard W. Davis and Marshall B. Payne were the members of the
Compensation Committee during fiscal 2000. Neither of the members of the
Compensation Committee during fiscal 2000, was or has ever been, an officer or
employee of the Company or any of its subsidiaries.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee has furnished the following report on the
Company's executive compensation program. The report describes the Compensation
Committee's compensation policies applicable to the Company's executive officers
and provides specific information regarding the CEO's compensation.
Non-employee members of the Company's Board of Directors review all
decisions the Compensation Committee makes relating to the Company's executive
officers' compensation. The Compensation Committee makes decisions about, and
recommends to the Board of Directors, grants or awards under the 1997 Option
Plan.
o Compensation Policy. The Compensation Committee's overall
policy regarding compensation of the Company's executive
officers is to provide salary levels and compensation
incentives that attract and retain qualified individuals in key
positions, that recognize individual performance and the
Company's performance, and that support the Company's objective
of achieving sustained improvements in its financial condition,
operating results, and market position. The Compensation
Committee attempts to implement this policy by paying the
Company's executive officers slightly above average
compensation with an emphasis on performance-related pay. The
Company's objective is to pay its executive officers
competitively in base pay and automobile allowances compared
with similarly situated executives at comparable companies, and
then to give the executive an incentive by providing the
executive officers the opportunity to earn significantly higher
than average performance-based compensation. The
performance-based compensation is made up of awards under the
Bonus Plan and stock options under the 1997 Option Plan.
The Compensation Committee periodically reviews publicly
available and private executive-compensation surveys prepared
by independent sources, including compensation consultants, to
determine compensation levels and practices of comparable
companies. The Compensation Committee identifies those
comparable companies, in its discretion, after considering a
broad range of factors, including levels of revenues,
geographic regions of operations, growth, and industry (e.g.,
service versus manufacturing). The group of comparable
companies includes some companies in the specialty retail
industry and some of the companies in the peer group identified
below under "Stock Performance Chart," but is not limited to
companies of those kinds or companies whose stock is quoted in
The Nasdaq Stock Market. The Compensation Committee also
solicits appropriate input from the chief executive officer
regarding compensation for the senior executives who report to
him.
In determining executive officer compensation, the Compensation
Committee considers the Company's performance as compared to
its budget; each individual officer's experience level, level
of responsibility, and performance as compared to the budgeted
performance goals for such officer; the Company's growth; and
cash flow performance. Individual salaries are reviewed every 9
to 15 months and, based on evaluations of individual
performance, are adjusted in accordance with budgeted
compensation guidelines the Board of Directors has established
for all officers.
-13-
o Base Salaries and Allowances. The Compensation Committee
determines the base pay and allowances for the CEO and reviews
the compensation of the Company's other officers as determined
by the CEO. In this determination or review, as the case may
be, as a basis for comparison, the Compensation Committee
attempts to determine the base salaries and allowances of
similarly situated executives in comparable companies. Then the
Compensation Committee determines a base salary and automobile
allowance that is comparable with that which such similarly
situated executives at the comparable companies would be paid.
o Performance Pay. The Compensation Committee determines the
performance-based compensation for the CEO and reviews the
performance-based compensation of the Company's other executive
officers as determined by the CEO. In this determination or
review, as the case may be, if the Company's executive officers
have performed in accordance with the Compensation Committee's
expectations as described above, the Compensation Committee
ensures the CEO and the other senior executives are provided
with above average (as compared to similarly situated
executives at comparable companies) performance-based bonuses
through the Bonus Plan and stock options through the 1997
Option Plan.
o Senior Management Bonus Plan. The Bonus Plan is an incentive
program for the Named Executive Officers and certain other
members of management. The Bonus Plan's goal is to place a
portion of the participants' annual compensation at risk to
encourage and reward performance that meets or exceeds the
Company's expectations. Under the Bonus Plan, at the beginning
of the fiscal year, the Compensation Committee recommends, and
the Board of Directors approves, the current fiscal year plan.
For the Named Executive Officers and certain other members of
management to earn 100% of their targeted bonuses for the
current fiscal year, the Company must achieve a 25% increase in
pre-tax earnings for the fiscal year ending June 30, 2001
compared to the fiscal year ended June 30, 2000. The Named
Executive Officers and certain other members of management
begin earning their bonuses when the Company achieves a 15%
increase in pre-tax earnings for the fiscal year ending June
30, 2001 compared to the fiscal year ended June 30, 2000. To
the extent the Company exceeds the targeted increase in pre-tax
earnings of 25%, the bonus pool would be increased $26,000 for
each 1% increase over the targeted increase in pre-tax earnings
of 25%.
o Stock Options. The Compensation Committee grants stock options
under the 1997 Option Plan to encourage and facilitate personal
stock ownership by officers and key employees, including the
CEO, thus strengthening their commitment to the Company and
encouraging a longer-term perspective to their
responsibilities. This feature of the Company's compensation
program directly links officers' and key employees' interests
with those of the Company's shareholders. The Compensation
Committee reviews prospective grants of stock options to the
Company's officers and considers the value and benefit of such
options during its review of such officers' overall
compensation packages. The Compensation Committee's policy is
to grant stock option awards based on individual performance
and the potential for the option recipient to contribute to the
Company's future success; awards are not affected by the amount
or terms of the options previously granted to the officer or
key
-14-
employee. Under the 1997 Option Plan, the Compensation
Committee may grant either incentive or non-qualified options,
but typically grants incentive stock options because of the tax
advantages to the optionees resulting from the grant of such
options. The Compensation Committee generally grants options
under the 1997 Option Plan that expire in 10 years and become
exercisable in equal installments over a four-year period. The
Compensation Committee believes that such limitations provide
those holding options with incentives to remain in the
employment of the Company, while also providing a performance
incentive that can provide direct benefits within a relatively
short period of time.
o Limits on Tax Deductibility of Compensation. Under Section
162(m) of the Internal Revenue Code of 1986, as amended, the
Company is generally precluded from deducting compensation in
excess of $1 million per year for any of its Named Executive
Officers unless the compensation is based on performance. This
tax provision had no effect on the Company in fiscal 2000.
Further, the Compensation Committee intends to continue to use
performance-based compensation, as described above, which
should negate or minimize any effect of this tax provision.
o CEO Compensation. In accordance with the policies described
above in this report, the fiscal 2000 base salary of Mr.
Neustadt was established at $308,014. The Compensation
Committee believed that this salary was within the range of
salaries paid to chief executive officers of comparable
companies in October 1999, when it was established. This
salary, which constituted an increase of approximately 10% of
the salary that had been set for Mr. Neustadt in fiscal 1999,
reflected the Committee's assessment of Mr. Neustadt's past
performance and anticipated future contributions to the
Company. Mr. Neustadt has overseen the Company's operations
since November 1994, and has served a key role in the expansion
of the various kinds of business that the Company conducts and
in its growth strategy, including major acquisitions. He is
thoroughly familiar with the consumer or retail financial
services industry and would (the Compensation Committee
believed) continue to lead the Company's growth and success. In
accordance with the terms of the Bonus Plan, Mr. Neustadt did
not receive a bonus in fiscal 2000. Mr. Neustadt was also
granted options under the 1997 Option Plan to acquire 11,686
shares of Common Stock. See "--Stock Options" above.
The Compensation Committee of the Board of Directors:
Howard W. Davis (Chairman)
Marshall B. Payne
CHANGE-IN-CONTROL SEVERANCE AGREEMENTS
The Compensation Committee and the Board of Directors of the Company
recognized that, as is the case with most publicly held companies, the
possibility of a change in control exists. To help assure continuity of
experienced and qualified management of the Company, the Compensation Committee
recommended, and the Board of Directors authorized and approved, a
Change-in-Control Executive Severance Agreement ("Severance Agreement") with
each of Mr. Neustadt, Mr. Shipowitz, Mr. McCarty and Ms. Bradford (each an
"Executive"). Mr. Neustadt, Mr. Shipowitz and Mr. McCarty's Severance
Agreements, the terms of which are substantially identical, were entered into on
August 20, 1998. Ms. Bradford's Severance Agreement, the terms of which are
substantially identical to those in the other Severance Agreements, was entered
into on August 17, 2000.
-15-
Each Severance Agreement obligates the Company to provide severance
benefits to the Executive if his or her employment with the Company and its
subsidiaries is terminated, within 24 months after a Change in Control, either
(i) by the Company for any reason other than Cause or the Executive's disability
or (ii) by the Executive for Good Reason. "Change in Control," as defined in the
Severance Agreement, includes (a) the acquisition (other than from the Company)
of 25% or more of the outstanding voting securities of the Company by any person
or group of persons, (b) a change in the Board of Directors such that the
persons who were directors at the beginning of any two-year period (and any new
director whose election was approved by at least two-thirds of the directors who
either were directors at the beginning of the period or whose election was so
approved) cease to constitute a majority of the Board of Directors, or (c) a
reorganization, merger, or consolidation of the Company, or the shareholders'
approval of the sale or substantially all the assets of the Company, other than
in certain circumstances described in the Severance Agreement. "Cause," as
defined in the Severance Agreement, includes the Executive's continued failure
to perform his or her duties after notice from the Board of Directors or his or
her engaging in conduct that materially injures the Company. "Good Reason," as
defined in the Severance Agreement, includes a material reduction of the
Executive's compensation or benefits; a material reduction in the Executive's
position, authority, or responsibilities; a forced relocation of the Executive's
office by more than 50 miles; or the failure of any successor to the Company to
expressly assume the Company's obligations under the Severance Agreement.
The severance benefits under the Severance Agreement are (i) a payment
equal to two and one-half times the sum of the Executive's base salary, annual
bonus, and car allowance, (ii) the accelerated vesting of outstanding stock
options, and (iii) the continuation of insurance benefits for 30 months after
termination of employment. The payment is to be made in two equal installments,
the first promptly after the termination of employment, and the second on the
first anniversary of the termination of employment; the second installment is
subject to offset by the Company if the Executive violates the noncompetition
covenant or the nondisclosure covenant in the Severance Agreement. The severance
benefits are limited to the amount that may be paid or provided to the Executive
without making an "excess parachute payment" under federal tax laws.
The Company is obligated to pay the Executive's legal fees and other
expenses incurred in connection with any good-faith enforcement or defense of
his rights under the Severance Agreement.
Each Severance Agreement will be effective until (i) any termination of
the Executive's employment before a Change-in-Control or (ii) June 30, 2001 or
any subsequent year if the Company or the Executive gives at least six months'
notice of termination.
CERTAIN RELATIONSHIPS
Mr. Neustadt is serving, at the Company's request, as a director of
Instant Insurance Holdings, Inc., a privately held company with which the
Company has contractual relationships ("Instant"). Instant, through licensed
insurance agents, solicits and produces property and casualty insurance and
related products in Texas and certain other states. For that service, Mr.
Neustadt is entitled to the same compensation from Instant as the other
non-employee directors of Instant.
Mr. Shipowitz is serving, at the Company's request, as a director of
ePacific Incorporated, a privately held company in which the Company invested
during fiscal 2000 ("ePacific"). ePacific provides customized debit-card payment
systems and electronic funds transfer processing services. For that service, Mr.
Shipowitz is entitled to the same compensation from ePacific as the other
non-employee directors of ePacific.
-16-
STOCK PERFORMANCE CHART
The following chart compares the return on the Common Stock with the
NASDAQ Market Index and a financial services peer group (consisting of Cash
America International, Inc.; EZ Corp, Inc.; First Cash, Inc.; H&R Block, Inc;
and World Acceptance Corp.) for the period from June 30, 1995 through June 30,
2000. The comparison assumes that $100 was invested on June 30, 1995, and
assumes reinvestment of dividends and distributions.
1995 1996 1997 1998 1999 2000
Peer Group 100 82.67 86.44 114.64 133.47 88.26
ACE 100 161.64 205.38 424.92 347.94 292.52
Broad Market 100 125.88 151.64 201.01 281.68 423.84
PROPOSAL TO AMEND THE ACE CASH EXPRESS, INC. 1997 STOCK OPTION PLAN
BACKGROUND AND SUMMARY OF TERMS
In August 1997 the Board of Directors of the Company adopted, and in
November 1997 the shareholders of the Company approved, the 1997 Option Plan,
under which options may be granted to key employees of the Company and its
subsidiaries for the purchase of shares of Common Stock. On September 26, 2000,
the Board of Directors adopted an amendment to the 1997 Option Plan to increase
the number of shares of Common Stock that may be issued upon exercise of options
granted under that plan from 1,215,000 shares to 1,715,000 shares; the proposed
increase will permit the Company to continue to provide incentive to key
employees of the Company by aligning their interests directly with those of the
Company's shareholders. At the Annual Meeting, the Company's shareholders will
be asked to approve that amendment to the 1997 Option Plan.
The following description of the 1997 Option Plan is only a summary; it
does not purport to be a complete or detailed description of all of the
provisions of the 1997 Option Plan. A copy of the 1997 Option Plan will be
furnished by the Company to any shareholder upon written request to the
Secretary of the Company at the Company's executive offices.
-17-
The 1997 Option Plan permits the grant of options to the key employees
(including officers) of the Company and its subsidiaries to purchase shares of
Common Stock. The eligible key employees are those employees whose performance
and responsibilities are determined by the Compensation Committee of the Board
of Directors to be influential to the success of the Company and its
subsidiaries. Approximately 100 of the Company's employees may participate in
the 1997 Option Plan.
The Compensation Committee administers and interprets the 1997 Option
Plan. In that capacity, the Compensation Committee has complete discretion,
within the limits set forth in the 1997 Option Plan, to determine the terms of
the options granted, including the term of, the number of shares subject to, the
exercise price of, and the form of consideration payable upon exercise of each
such option. The Compensation Committee is constituted in a manner intended to
comply with the requirements of Rule 16b-3 under the Exchange Act, relating to
the disinterested administration of employee benefit plans. Members of the
Compensation Committee receive no additional compensation for their services in
connection with the administration of the 1997 Option Plan.
Each option granted under the 1997 Option Plan is evidenced by a
written stock option agreement between the Company and the option holder. The
specific terms of any individual option granted may vary, but only to the extent
permitted by the terms of the 1997 Option Plan.
The term of an option granted under the 1997 Option Plan may not exceed
ten years from the date of grant of that option. The options granted under the
1997 Option Plan are generally for the maximum ten-year period.
Full payment for shares purchased upon exercise of an option must be
made at the time of exercise, and no shares may be issued until full payment is
made. The exercise price of each option is payable in cash or by check or, if
the option agreement with the Company so provides, in shares of Common Stock at
the fair market value per share on the date of exercise.
Though the Compensation Committee has discretion to determine the terms
of the exercise of any option, options are generally exercisable in equal annual
installments over a four-year period. All installments that become exercisable
are generally cumulative and may be exercised at any time after they become
exercisable until the expiration of the term of the option. Incentive stock
options and, unless otherwise specified in the applicable option agreements,
nonqualified stock options may not be transferred other than by will or by the
laws of descent and distribution. If an optionee dies or becomes permanently
disabled before the termination of his option without having totally exercised
the option, the option may be exercised, to the extent that the optionee could
have exercised it on the date of his death or disability, by (i) in the case of
death, his estate or the person who acquired the right to exercise the option by
bequest or inheritance, or (ii) in the case of disability, the optionee or his
personal representative, provided that the option is exercised before the date
of the expiration of the option or 180 days after the date of the optionee's
death or disability, whichever occurs first.
Both incentive stock options and nonqualified stock options may be
granted under the 1997 Option Plan. The 1997 Option Plan requires that the
exercise price of each incentive stock option be at least 100% of the fair
market value of the Common Stock at the time of the grant of the option. No
incentive stock option, however, may be granted under the 1997 Option Plan to
anyone who owns more than 10% of the outstanding Common Stock unless the
exercise price is at least 110% of the fair market value of the Common Stock at
the date of grant and the option is not exercisable for more than five years
after it is granted. There is no limit on the fair market value of incentive
stock options that may be granted to an employee in any calendar year, but no
employee may be granted incentive stock options that first become exercisable
during a calendar year for the purchase of stock with an aggregate fair market
value (determined as of the date of grant of each option) in excess of $100,000.
An option (or an installment thereof) counts against this annual limitation only
in the calendar year in which it first becomes exercisable.
-18-
Unless the Board of Directors terminates it sooner, the 1997 Option
Plan will terminate on August 4, 2007, and no options may be granted under the
1997 Option Plan thereafter. The Board of Directors or the Compensation
Committee may amend, alter or discontinue the 1997 Option Plan without the
shareholders' approval, except that the Board of Directors or the Compensation
Committee does not have the power or authority to materially increase the number
of securities that may be issued under the 1997 Option Plan or to materially
modify the requirements of eligibility for participation in the 1997 Option
Plan. The Board of Directors or the Compensation Committee, however, may make
appropriate adjustments in the number of shares the 1997 Option Plan covers, in
the number of outstanding options, and in the option exercise prices to reflect
any stock dividend, stock split, share combination or other recapitalization
and, with respect to outstanding options and option prices, to reflect any
merger, consolidation, reorganization, liquidation or similar transaction
involving the Company.
As of September 29, 2000, options to purchase a total of 1,140,383
shares of Common Stock under the 1997 Option Plan (excluding expired or
terminated options) had been granted, options to purchase a total of 23,418
shares had been exercised, options to purchase a total of 1,116,965 shares were
outstanding, and a total of 74,617 shares were available for future option
grants. As of September 29, 2000, the total market value of all shares of Common
Stock subject to outstanding options was $12,286,615 (based upon the closing
price of the Common Stock of $11.00 per share as reported on The Nasdaq Stock
Market on that date).
TAX STATUS OF STOCK OPTIONS
The Compensation Committee may provide for an option under the 1997
Option Plan to qualify either as an incentive stock option ("ISO") or as a
nonqualified stock option for United States federal income tax purposes.
Incentive Stock Options. All stock options that qualify under the rules
of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"),
will be entitled to ISO treatment. To receive ISO treatment, an optionee must
not dispose of the acquired stock within two years after the option is granted
or within one year after exercise. In addition, the individual must have been an
employee of the Company for the entire time from the date of grant of the option
until three months (or one year if the employee is disabled) before the date of
the exercise. The requirement that the individual be an employee and the
two-year and one-year holding periods are waived in the case of death of the
employee. If all such requirements are met, no tax will be imposed upon exercise
of the option, and any gain upon sale of the acquired stock will be entitled to
capital gain treatment. The employee's gain on exercise (the excess of fair
market value at the time of exercise over the exercise price) of an ISO is a tax
preference item and, accordingly, is included in the computation of alternative
minimum taxable income.
If an employee does not meet the two-year and one-year holding
requirement (a "disqualifying disposition"), but does meet all other
requirements, tax will be imposed at the time of sale of the acquired stock, but
the employee's gain on exercise will be treated as ordinary income, rather than
capital gain, and the Company will get a corresponding deduction at the time of
sale in an amount equal to the income that the employee would have recognized on
exercise of the option. Any remaining gain on sale will be short-term or
long-term capital gain, depending on the holding period of the stock. If the
amount realized on the disqualifying disposition is less than the value at the
date of exercise, the amount includible in gross income, and the amount
deductible by the Company, will equal the excess of the amount realized on the
sale or exchange over the exercise price.
-19-
An option agreement with the Company may permit payment for stock upon
the exercise of an ISO to be made with other shares of Common Stock. In such a
case, in general, if an employee uses stock acquired pursuant to the exercise of
an ISO to acquire other stock in connection with the exercise of an ISO, it may
result in ordinary income if the stock so used has not met the minimum statutory
holding period necessary for favorable tax treatment as an ISO.
Nonqualified Options. In general, no taxable income will be recognized
by the optionee, and no deduction will be allowed to the Company, upon the grant
of an option. Upon exercise of a nonqualified option, an optionee will recognize
ordinary income (and the Company will be entitled to a corresponding tax
deduction if applicable withholding requirements are satisfied) in an amount
equal to the amount by which the fair market value of the shares on the exercise
date exceeds the option exercise price. Any gain or loss realized by an optionee
on disposition of such shares generally is a capital gain or loss and does not
result in any tax deduction to the Company.
The foregoing statements are based upon present federal income tax laws
and regulations are subject to change if the tax laws and regulations, or
interpretations thereof, are changed.
REQUIRED VOTE
The favorable vote of the holders of a majority of the shares of Common
Stock present and entitled to vote at the Annual Meeting in person or by proxy
is required to approve the proposed amendment to the 1997 Option Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE PROPOSAL
TO AMEND THE 1997 OPTION PLAN.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP served as the independent auditors of the Company
for fiscal 2000 and has been selected by the Board of Directors as the
independent auditors of the Company for the current fiscal year. One or more
representatives of Arthur Andersen LLP are expected to attend the Annual
Meeting, at which they will have an opportunity to make a statement and will
respond to appropriate questions from shareholders.
SHAREHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
An eligible shareholder who wishes to include a proposal in the
Company's proxy statement for the 2001 Annual Meeting of Shareholders must
submit it, in accordance with the SEC's Rule 14a-8, so that it is received by
the Company's Secretary, at the Company's executive offices, on or before June
18, 2001.
A shareholder who wishes to make a proposal at the 2001 Annual Meeting
of Shareholders without including the proposal in the Company's proxy statement
must give written notice of that proposal to the Company's Secretary, at the
Company's executive offices, by September 1, 2001. If a shareholder fails to
timely give that notice, then the persons named as proxies in the proxy cards
solicited by the Company's Board of Directors for that meeting will be entitled
to vote the proxy cards held by them regarding that proposal, if properly raised
at the meeting, in their discretion.
-20-
MISCELLANEOUS
All information contained in this Proxy Statement relating to the
occupations, affiliations, and securities holdings of directors and executive
officers of the Company and their relationship and transactions with the Company
is based upon information received from the individual directors and executive
officers. All information relating to any beneficial owner of more than 5% of
the Common Stock is based upon information contained in reports filed by such
owner with the SEC.
THE COMPANY WILL FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON
FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO, FOR THE
FISCAL YEAR ENDED JUNE 30, 2000 FILED WITH THE SEC PURSUANT TO SECTION 13 OR
15(D) OF THE EXCHANGE ACT TO ANY SHAREHOLDER (INCLUDING ANY BENEFICIAL OWNER)
UPON WRITTEN REQUEST TO INVESTOR RELATIONS/CORPORATE COMMUNICATIONS, 1231
GREENWAY DRIVE, SUITE 800, IRVING, TEXAS 75038. A COPY OF THE EXHIBITS TO SUCH
REPORT WILL BE FURNISHED TO ANY SHAREHOLDER UPON WRITTEN REQUEST THEREFOR AND
PAYMENT OF A NOMINAL FEE.
By Order of the Board of Directors,
Debra A. Bradford
Secretary
Irving, Texas
October 17, 2000
-21-
ACE CASH EXPRESS, INC.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- NOVEMBER 17, 2000
I (i) acknowledge receipt of the Notice of Annual Meeting of
Shareholders of Ace Cash Express, Inc., a Texas corporation (the "Company"), to
be held on Friday, November 17, 2000, at 10:00 a.m., Dallas time, at the Dallas
Marriott Las Colinas, 223 West Las Colinas Boulevard, Irving, Texas 75039, and
the Proxy Statement in connection therewith; and (ii) appoint Raymond C. Hemmig
and Donald H. Neustadt, and each of them, my proxies with full power of
substitution, for and in my name, place and stead, to vote upon and act with
respect to all of the shares of Common Stock of the Company standing in my name,
or with respect to which I am entitled to vote and act, at the meeting and at
any adjournment thereof, and I direct that this proxy be voted as indicated on
the other side.
I hereby revoke any proxy or proxies heretofore given to vote upon or
act with respect to such stock and hereby ratify and confirm all that the
proxies, their substitutes, or any of them, may lawfully do by virtue hereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS.
IMPORTANT: SIGN AND DATE ON OTHER SIDE
(FOLD AND DETACH HERE)
PREFERENTIAL SHAREHOLDERS LIST
To be among the first to receive via e-mail or fax the latest press releases,
announcements, news clippings and other up-to-date public information regarding
ACE, please fill out the information below and return via fax (972/582-1437),
e-mail smotherman@acecashexpress.com or regular mail.
(Please Print Clearly)
Name: __________________________ # of ACE shares currently held: _____________
Address: ______________________________________ Phone #: ____________________
City: ____________________________ State: ____________ Zip Code: ___________
E-mail: ______________________________________________ Fax #: ______________
THIS PROXY WILL BE VOTED AS INDICATED BELOW. UNLESS OTHERWISE INDICATED, THIS
PROXY WILL BE VOTED FOR ALL NOMINEES IN ITEM 1 AND FOR THE PROPOSAL IN ITEM 2.
THIS PROXY WILL BE VOTED IN THE DISCRETION OF THE PROXIES NAMED HEREIN (OR
EITHER OF THEM) REGARDING ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE
MEETING.
1. Election of Directors
FOR all nominees listed WITHHOLD AUTHORITY
below (except as marked to vote for all
to the contrary below) nominees listed above
[ ] [ ]
Nominees: Raymond C. Hemmig, Donald H. Neustadt, Jay B. Shipowitz, Marshall B.
Payne, Michael S. Rawlings, Edward W. Rose III, and Charles Daniel Yost
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- - --------------------------------------------------------------------------------
2. The proposal to increase the number of shares of Common Stock authorized
for issuance under the Company's 1997 Stock Option Plan from 1,215,000
shares to 1,715,000 shares.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. In the discretion of the proxies, on any other matter that may properly come
before the meeting or any adjournment thereof.
Date: ________________________, 2000
---------------------------------
Signature of Shareholder
---------------------------------
Printed Name of Shareholder
---------------------------------
Title, if applicable
Please date this proxy and sign your
name exactly as it appears hereon. Where
there is more than one owner, each
should sign. When signing as an
attorney, administrator, executor,
guardian or trustee, please add your
title as such. If executed by a
corporation, a duly authorized officer
should sign the proxy. EACH JOINT TENANT
SHOULD SIGN.
PLEASE MARK, SIGN, DATE AND RETURN YOUR PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
NO POSTAGE VOTES MUST BE INDICATED (X) IN BLACK OR BLUE INK IS REQUIRED.