SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
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Taco Cabana, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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[X ] No fee required.
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Taco Cabana, Inc.
8918 Tesoro Dr., Suite 200
San Antonio, Texas 78217
Notice of Annual Meeting of Stockholders
June 6, 2000
TO THE STOCKHOLDERS OF
TACO CABANA, INC.:
Notice is hereby given that the Annual Meeting of Stockholders of Taco
Cabana, Inc., a Delaware corporation (the "Company"), will be held at the
Airport Hilton Hotel, 611 Northwest Loop 410, San Antonio, Texas, on
Tuesday, June 6, 2000, at 10:00 a.m., Central Daylight Time for the
following purposes:
1.) To elect six directors.
2.) To approve the adoption of the 2000 Stock Ownership Plan.
3.) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on Friday, April
14, 2000 as the record date for the determination of stockholders entitled
to vote at the meeting.
We hope that you will be able to attend the meeting in person, but if
you are unable to do so, please fill in, sign and promptly mail back the
enclosed proxy form, using the return envelope provided. If for any reason
you should subsequently change your plans, you can of course revoke the
proxy at any time before it is actually voted.
BY ORDER OF THE BOARD OF DIRECTORS
David G. Lloyd
Secretary
San Antonio, Texas
April 24, 2000
TACO CABANA, INC.
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 6, 2000
THE MEETING
This Proxy Statement is furnished to the stockholders of Taco Cabana,
Inc., a Delaware corporation, in connection with the solicitation of proxies
by the Board of Directors of the Company for use at the Annual Meeting of
Stockholders to be held Tuesday, June 6, 2000 (the " Meeting" ). This Proxy
Statement, the accompanying proxy, and the Company's Annual Report are being
sent or given to the stockholders of the Company on or about April 24, 2000.
The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of the Company's Common Stock is necessary to
constitute a quorum at the Meeting. Pursuant to applicable Delaware law,
only votes cast "for" a matter constitute affirmative votes. Votes
"withheld" or abstaining from voting are counted for quorum purposes, but
since they are not cast "for" a particular matter, they will have the same
effect as negative votes or votes "against" a particular matter. In deciding
all questions, a holder of Common Stock is entitled to one vote, in person
or by proxy, for each share held on the record date.
Proxies in the form enclosed will be voted at the Meeting, if properly
executed, returned to the Company prior to the Meeting and not revoked. A
proxy may be revoked at any time before it is voted by giving written notice
of revocation to the Secretary of the Company prior to the convening of the
Meeting, or by presenting another proxy card with a later date. If you
attend the Meeting and desire to vote in person, you may request that your
previously submitted proxy card not be used.
The record date for stockholders entitled to vote at the Meeting is
April 14, 2000. At the close of business on April 14, 2000, the Company had
issued and outstanding and entitled to vote at the Meeting 11,601,375 shares
of Common Stock. As of April 14, 2000, the directors and executive officers
of the Company owned a total of 130,880 shares of the Company's Common
Stock, or approximately 1.1% of the total number of shares outstanding and
entitled to vote at the Meeting.
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information concerning the
beneficial ownership of the Company's Common Stock as of February 28, 2000, by:
(i) each person known by the Company to be the beneficial owner of more than 5%
of its Common Stock, (ii) each named executive officer of the Company, (iii)
each director of the Company, and (iv) all directors and officers as a group.
Unless otherwise indicated, each of the stockholders has sole voting and
investment power with respect to the shares beneficially owned.
Shares Beneficially Owned
Name Number Percent
Stephen V. Clark (1) 193,063 1.6%
David G. Lloyd (2) 109,000 *
Douglas Gammon (3) 50,000 *
Dennis Greenia (4) 15,000 *
William J. Nimmo (5) 22,817 *
Richard Sherman (6) 93,003 *
Cecil Schenker (7) 113,503 *
Lionel Sosa (8) 16,000 *
Rod Sands (9) 108,000 *
Dimensional Fund Advisors, Inc. (10) 957,064 7.9%
All directors and officers as
a group (9 persons) (11) 720,386 5.9%
___________________________
* Less than 1%.
2
(1) Includes 180,000 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 123,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(2) Includes 95,000 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 55,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(3) Includes 45,000 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 55,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(4) Represents shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 60,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(5) Includes 19,000 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 13,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(6) Represents shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 3,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(7) Represents shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 3,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(8) Represents shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 13,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(9) Includes 13,000 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 13,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
(10) Based upon Schedule 13G, filed in February 2000, indicating beneficial
ownership, sole dispositive power and sole voting power as stated in the
table. Address: 1299 Ocean Avenue, 11th Floor, Santa Monica, CA 90401.
(11) Includes 589,506 shares subject to presently exercisable options (or those
exercisable within 60 days). Excludes 338,000 shares issuable pursuant to
options which are not currently exercisable (or exercisable within 60
days).
3
PROPOSAL 1
ELECTION OF DIRECTORS
At the Annual Meeting, six directors are to be elected by plurality of the
votes cast by the holders of the shares of outstanding Common Stock of the
Company. Under applicable Delaware law, in tabulating the vote, broker
nonvotes will be disregarded and have no effect on the outcome of the vote.
Each outstanding share of Common Stock entitles the holder thereof to one
vote with respect to the election of the six director positions to be filled
at this meeting. The nominees for director are Stephen V. Clark, William J.
Nimmo, Richard Sherman, Cecil Schenker, Lionel Sosa and Rod Sands. All of
the nominees are presently directors of the Company. For information
concerning the backgrounds of such nominees, see "Directors and Executive
Officers" on page 5.
The enclosed Proxy, if properly signed and returned will be voted FOR the
election of these six nominees unless authority to vote is withheld. The
Board of Directors has no reason to believe that any of such nominees will
be unable to serve if elected. In the event any of such nominees become
unavailable for election, votes will be cast, pursuant to authority granted
by the enclosed Proxy, for such substitute nominee as may be designated by
the Board of Directors. All directors will hold office until the next annual
meeting of stockholders and until their successors have been duly elected
and qualified, unless prior to such meeting a director resigns or his
directorship otherwise becomes vacant.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE " FOR" THE
ELECTION OF THE DIRECTOR NOMINEES.
4
Directors and Executive Officers
The directors and executive officers of the Company and their respective
ages are as follows:
Name Age Position
Stephen V. Clark 46 Chief Executive Officer,
President and Director
Douglas Gammon 53 Senior Vice President - Human
Resources and People Development
Dennis Greenia 50 Senior Vice President
Marketing
David G. Lloyd 36 Senior Vice President - Finance,
Chief Financial Officer,
Secretary and Treasurer
William J. Nimmo 45 Director
Rod Sands 52 Director
Cecil Schenker 57 Director
Richard Sherman 56 Director
Lionel Sosa 60 Director
Mr. Clark has served as the Company's Chief Executive Officer since
November 1996, and as the President, Chief Operating Officer, and as a Director
since April 1995. Prior to that, Mr. Clark was with Church's Chicken, a
division of America's Favorite Chicken, for seventeen years with his final title
having been Senior Vice President and Concept General Manager. He also served
on the executive committee of America's Favorite Chicken and was on the Board of
Directors of Church's Operators Purchasing Association. In his final position
with America's Favorite Chicken, Mr. Clark was primarily responsible for the
day-to-day operations of over 1100 company-owned and franchised units with
aggregate sales volume in excess of $600 million.
Mr. Gammon joined the Company in March 1997 as Senior Vice President -
Human Resources and People Development. From December 1989 to March 1997, Mr.
Gammon served as Vice President of Human Resources at Marriott's foodservice
division which had over 15,000 employees in 50 states. Mr. Gammon has over 20
years of experience in the human resources and training fields as well as over
six years experience in restaurant operations. He was the past President for
the Council of Hotel and Restaurant Trainers.
Mr. Greenia joined the Company in July 1998 as Senior Vice President -
Marketing. From January 1989 to July 1998, Mr. Greenia served as President of
the Merrill Group, a marketing consulting firm in Atlanta GA., whose clients
included the Coca-Cola Company, Dominos Pizza, Bally's Total Fitness and
Hardee's Foods. Mr. Greenia has over 19 years experience both nationally and
internationally in the food service industry holding positions with Burger King
Corporation, J. Walter Thompson Advertising and Coca Cola USA. Mr. Greenia is
also a majority partner in Mobile Media Network of Atlanta, Inc.
Mr. Lloyd joined the Company in October 1994 as Vice President - Finance,
Chief Financial Officer, Secretary and Treasurer and was promoted to Senior Vice
President in May 1996. From August 1985 to October 1994, Mr. Lloyd served in
various capacities with Deloitte & Touche (the Company's independent auditors),
with his last position being Senior Audit Manager. Mr. Lloyd is a certified
public accountant.
5
Mr. Nimmo has served as a director of the Company since November 1991.
Since May 1997, Mr. Nimmo has been a Partner with Halpern, Denny & Co., a
venture capital firm in Boston, Massachusetts. Prior to that, Mr. Nimmo served
as Managing Director of Cornerstone Equity Investors, Inc., and its predecessor
firm, Prudential Equity Investors, Inc., since September 1989.
Mr. Sands has been a director of the Company since February 1998. Since
July 1997, Mr. Sands has served as the Managing Director of Silver Brands, a
private equity investment fund. Since 1999, Mr. Sands has also served as Chief
Operating Officer of Silver Ventures, a private public market investment firm.
Mr. Sands serves as the Chairman of the board of directors of Desert Glory,
Inc., and MarketFare Foods while also serving as member of the board of
directors of Nonni's Foods, and Benefit Planners, Inc. Mr. Sands also serves on
the Chase Bank of Texas - San Antonio Advisory Board.
Mr. Schenker has been a director of the Company since January 1992. Mr.
Schenker is a corporate securities attorney and is the managing partner of the
San Antonio, Texas office of the law firm of Akin, Gump, Strauss, Hauer & Feld,
L.L.P., of which Mr. Schenker has been a partner through his professional
corporation since January 1984. Akin, Gump, Strauss, Hauer & Feld, L.L.P. has
regularly performed legal services for the Company.
Mr. Sherman has been a director of the Company since November 1991. Mr.
Sherman is a private investor and retail consultant. Mr. Sherman served as
President and Chief Executive Officer of Rally's, Inc. from September 1987 to
January 1991. From August 1989 to January 1991, he also served as Chairman of
the Board of Rally's, Inc. From 1984 to 1987, Mr. Sherman was President and a
director of Church's Chicken, Inc. From 1971 to 1984, Mr. Sherman was Group
Executive Vice President and Director of Hardee's Food Systems, Inc. and its
parent, Imasco USA, Inc. Mr. Sherman currently serves as a director of Reed's
Jewelers, Inc., Papa John's International, Inc. and PJ America, Inc.
Mr. Sosa has been a director of the Company since August 1997. Mr. Sosa has
served as the Chief Executive Officer of KJS Marketing Agency since January
1996. From 1994 to 1996 he served as Chairman of DMB&B/Americas, a network of
advertising agencies in the U.S. and Latin America. In 1980, Mr. Sosa founded
the agency of Sosa, Bromley, Aguilar, Noble & Associates, an advertising agency
specializing in Hispanic marketing in the U.S. Mr. Sosa sold Sosa, Bromley,
Aguilar, Noble & Associates in 1994. Mr. Sosa is currently a Director of the
Children's Television Workshop Network.
The Board of Directors has a compensation and stock option committee which
currently consists of William J. Nimmo, Richard Sherman, Lionel Sosa and Rod
Sands. The Board of Directors also has an audit committee which currently
consists of William J. Nimmo, Richard Sherman, Lionel Sosa, Cecil Schenker and
Rod Sands. The Board of Directors does not currently have a nominating
committee. All directors serve for a term of one year and until their
successors are duly elected. Each director who is not also an employee of the
Company receives an annual retainer of $25,000, and an attendance fee of $2,500
per Board meeting for up to four meetings each year. All non-employee directors
are reimbursed for their expenses. Effective June 2000, all directors fees will
be paid with stock in the company rather than cash. The Board of Directors met
four times during 1999. Each incumbent director attended at least 75% of the
aggregate number of Board meetings and meetings of Board committees of which he
was a member held during 1999.
6
The compensation and stock option committee monitors and makes
recommendations to the Board with respect to compensation programs for officers
and directors and administers the Company's Stock Option Plan. The compensation
and stock option committee met two times during 1999.
The audit committee considers the adequacy of the internal controls of the
Company and the objectivity of financial reporting; meets with the independent
certified public accountants and appropriate Company financial personnel about
these matters; and recommends to the Board the appointment of the independent
certified public accountants. The audit committee met two times in 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 each director and executive officer of the Company,
and each person who owns more than 10% of a registered class of the Company's
equity securities to file by specific dates with the Securities and Exchange
Commission (the " SEC") initial reports of ownership and reports of change in
ownership of Common Stock and other equity securities of the Company. Officers,
directors and 10% stockholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file. The Company is
required to report in this report any failure of its directors and executive
officers to file by the relevant due date any of these reports during the
Company's fiscal year.
To the Company's knowledge, all Section 16(a) filing requirements
applicable to the Company's officers, directors, and 10% stockholders were
complied with.
7
COMPENSATION AND STOCK OPTION COMMITTEE REPORT TO SHAREHOLDERS
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following report includes a discussion of the Compensation Committee's
philosophy on executive compensation, the primary components of the Company's
compensation program and a description of the Chief Executive Officer's
compensation package during 1999.
COMPENSATION PRINCIPLES. The Compensation Committee is responsible for advising
the Board of Directors on matters relating to the compensation of the Company's
executive officers and administering the Company's 1994 Stock Option Plan (the
"1994 Option Plan"). The Compensation Committee believes the following
principles are important in compensating executive officers:
- - Compensation awarded by the Company should be effective in attracting,
motivating and retaining key executives;
- - Incentive compensation should be awarded based on the achievement of growth or
operational targets at the Company, its subsidiaries or restaurants, as
appropriate to the executive officer; and
- - Executive officers should have an equity interest in the Company to encourage
them to manage the Company for the long-term benefit of stockholders.
The Company's executive officers are compensated through a combination of
salary, cash bonuses and stock option awards under the 1994 Option Plan, each of
which is discussed below.
ANNUAL SALARY. The Company has a formalized salary administration plan that
considers individual performance, competitive salaries, and the latest changes
in overall wage and labor rates when adjusting annual base salary.
BONUS PROGRAM. The Company has adopted an incentive bonus plan, which covers
all of the Company's executive officers, as well as other selected personnel.
Under the plan, the Compensation Committee measures the performance of the
Company against an annual business plan prepared by management and reviewed and
approved by the Board of Directors. Achievement of the earnings target set forth
in the annual business plan may result in the payment of incentive payments
equal to a percentage of the base salary of the covered officer. The plan also
allows the committee to increase the incentive payments ratably to the extent
the Company exceeds the earnings target. The committee has the discretion
whether and in what amounts to award any incentive bonuses.
STOCK OPTION PLAN AWARDS. For 1999, stock options for a fixed number of shares
were awarded under the 1994 Option Plan to certain officers, management
personnel and staff, based on job classification. No options were awarded
executive management. Substantially all of the options vest in five equal
annual installments. Several of the grants are partially contingent upon
approval by the Company's stockholders of the proposed 2000 Stock Ownership Plan
that would provide for up to 500,000 shares to be issued. See "PROPOSAL TO
APPROVE THE ADOPTION OF THE TACO CABANA, INC. 2000 STOCK OWNERSHIP PLAN."
The Committee believes that stock options and other equity-based incentives are
a valuable tool in encouraging executive officers and other employees to align
their interests with the interests of the stockholders and to manage the Company
for the long-term. Incentive stock options to purchase 256,375 shares of the
Company's Common Stock were granted under the 1994 Option Plan in 1999,
including grants subject to stockholder approval of the 2000 Stock Ownership
8
Plan, with an exercise price equal to the fair market value of the underlying
Common Stock on the date of grant.
The Committee has approved, and the Company's Board of Directors has adopted,
subject to stockholder approval, the Taco Cabana, Inc. 2000 Stock Ownership Plan
(the "2000 Plan"). See "PROPOSAL TO APPROVE THE ADOPTION OF THE TACO CABANA,
INC. 2000 STOCK OWNERSHIP PLAN." The Committee believes that grants of stock
options under the 2000 Plan will continue to garner the commitment and service
of key management personnel, and other officers and employees by allowing these
employees to share in the appreciation and value of the Company's Common Stock.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
During 1999, Mr. Clark's annual salary was adjusted to $300,000 to reflect
his responsibilities, experience, individual performance and important
contributions to the Company. In addition, effective February 4, 2000, Mr.
Clark received a bonus of $263,769 under terms of the Company's bonus program
described above. The Compensation Committee followed the newly established
salary administration guidelines and the recommendation of an outside
compensation consultant in approving the increase in Mr. Clark's base pay as
well as the bonus payment.
Respectfully submitted,
THE COMPENSATION AND STOCK OPTION COMMITTEE
Richard Sherman, William J. Nimmo, Lionel Sosa, Rod Sands
9
Summary Compensation Table. The following table sets forth certain
information concerning the compensation earned during the Company's last three
fiscal years by the Company's Chief Executive Officer and the Company's other
executive officers (collectively the "named executive officers" ):
Summary Compensation Table
Annual Compensation Long-Term Compensation
------------------------- -------------------------------
Awards Payouts
Other ---------------------- --------
Annual Restricted Securities All Other
Compen- Stock Underlying LTIP Compen-
Name and Principal Fiscal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($)(1) ($) SARs(#) ($) ($)
Stephen V. Clark 1999 301,784 263,769 - - - - -
Chief Executive 1998 281,882 163,846 - - 100,000 - -
Officer, President, 1997 255,420 - - - - - -
Chief Operating Officer
David G. Lloyd, 1999 171,641 115,446 - - - - -
Senior Vice President, 1998 157,004 61,845 - - 50,000 - -
Chief Financial, 1997 143,528 - - - - - -
Officer, Secretary and
Treasurer
Douglas Gammon, 1999 150,381 100,154 - - - - -
Senior Vice President - 1998 142,469 53,577 38,393(3) - 25,000 - -
Human Resources and 1997 113,850(2) - 51,135(3) - 75,000 - -
People Development
Dennis Greenia 1999 146,866 96,331 - - - - -
Senior Vice Prsident - 1998 61,060(4) 26,000 75,000 - -
Marketing
__________________
10
(1) Certain of the Company's executive officers receive personal benefits in
addition to salary; however, the Company has concluded that the aggregate
amounts of such personal benefits do not exceed the lesser of $50,000 or 10%
of annual salary and bonus reported for any named executive officer.
(2) Mr. Gammon joined the Company in March 1997.
(3) Represents relocation expense reimbursements.
(4) Mr. Greenia joined the Company in July 1998.
11
Stock Option Plans and Directors' Options
Under the Taco Cabana, Inc. 1990 Stock Option Plan (the " 1990 Option
Plan"), amended in August 1992, and the 1994 Stock Option Plan (the " 1994
Option Plan"), amended in August 1997, options to purchase up to 1,500,000 and
1,250,000 shares, respectively, of Common Stock may be granted to employees,
outside directors and consultants and advisers of the Company or any subsidiary
corporation or entity. The stock is intended to permit the Company to retain
and attract qualified individuals who will contribute to its overall success.
Shares that by reason of the expiration of an option (other than by reason of
exercise) or which are no longer subject to purchase pursuant to an option
granted under an Option Plan may be reoptioned thereunder. The 1990 and 1994
Option Plans are administered by a committee of outside directors (the
"Committee" ). The Committee sets specific terms and conditions of options
granted under the 1990 and 1994 Option Plans and administers the 1990 and 1994
Option Plans, as well as the Company's other employee benefit plans which may be
in effect from time to time. The Committee currently consists of William J.
Nimmo, Lionel Sosa, Richard Sherman and Rod Sands.
The Company's employees are eligible to receive either incentive stock
options or nonqualified stock options or a combination of both, as the Committee
determines. Non-employee participants may be granted only nonqualified stock
options. Stock options may be granted for a term not to exceed ten years (five
years with respect to a holder of 10% or more of the Company's shares in the
case of an incentive stock option) and are not transferable other than by will
or the laws of descent and distribution. Each option may be exercised within
the term of the option pursuant to which it is granted (so long as the optionee,
if an employee, continues to be employed by the Company). In addition, an
incentive option may be exercised within 90 days after the termination of
employment of the optionee (subject to any limitations in the particular
option), within one year after termination in case of termination because of
disability, or throughout the term of the option in the event of the optionee's
death, to the extent in each case the option was exercisable at the termination
date. A nonqualified stock option may be exercised for such period, but not
later than the expiration date, after termination of employment, disability or
death, as may be specified in the particular option.
The exercise price of all incentive stock options must be at least equal to
the fair market value of the Common Stock on the date of grant, or 110% of fair
market value with respect to any incentive stock option issued to a holder of
10% or more of the Company's shares. Stock options may be exercised by payment
in cash of the exercise price with respect to each share to be purchased, by
delivering Common Stock of the Company already owned by such optionee with a
market value equal to the exercise price, or by a method in which a concurrent
sale of the acquired stock is arranged, with the exercise price payable in cash
from such sale proceeds.
12
The 1994 Option Plan provides that each outside director will automatically
receive a grant of 3,000 nonqualified stock options each year on the fifth
business day following the first public release of the Company's audited
earnings report on results of operations for the preceding fiscal year. Each
such option will become exercisable in whole or in part on the first anniversary
of the award through the balance of its ten-year term. Subject to availability
of shares allocated to the 1994 Option Plan and not already reserved for other
outstanding stock options, outside directors who join the Board in the future
will in addition receive an initial grant of options for 20,000 shares, which
will become exercisable in five equal increments beginning on the first
anniversary of the award and on each of the next four succeeding anniversary
dates. Such options will be exercisable for a term of ten years. Such options
will be awarded upon their appointment or election to the Board. Options, once
granted and to the extent exercisable, will remain exercisable throughout their
term, regardless of whether the holder continues as a director. The exercise
price of the options is equal to 100% of the fair market value of a share of
Common Stock at the time of grant.
The 1990 Option Plan will terminate on October 14, 2000. The 1994 Option
Plan will terminate on October 17, 2004. The Board of Directors may, however,
terminate the 1990 and 1994 Option Plans at any time prior to such respective
dates. Termination of the 1990 and 1994 Option Plans will not alter or impair,
without the consent of the optionee, any of the rights or obligations pursuant
to any option granted under the Option Plans.
As of January 2, 2000, options for 448,967 shares of common stock had been
granted under the 1990 Option Plan and were outstanding, with a weighted average
exercise price of $5.95 per share, and no additional shares were available for
issuance upon exercise of options which may be granted in the future. As of
January 2, 2000, options for 1,051,033 shares had been exercised.
As of January 2, 2000, options for 1,047,216 shares of common stock had
been granted under the 1994 Option Plan and were outstanding, with a weighted
average exercise price of $5.06 per share, and no additional shares were
available for issuance upon exercise of options which may be granted in the
future. 202,784 options had been exercised as of January 2, 2000.
13
Stock Option Grant Table. The following table sets forth certain
information concerning options granted to the named executive officers during
the Company's fiscal year ended January 2, 2000:
Option Grants in Last Fiscal Year
Percent of Potential
Total Realizable
Options Value at Assumed
Granted Annual Rates of
to Exercise Stock Price
Employees or Appreciation
in Base For Option Term (1)
Options Fiscal Price Expiration --------------------
Name Granted Year ($/Sh) Date 5% ($) 10% ($)
- -------------------------------------------------------------------------------
Stephen V.
Clark - - - - - -
David G.
Lloyd - - - - - -
Douglas
Gammon - - - - - -
Dennis
Greenia - - - - - -
- -------------------------------------------------------------------------------
(1) As required by rules of the Securities and Exchange Commission (" SEC" ),
potential values stated are based on the assumption that the Company's
Common Stock will appreciate in value from the date of grant to the end of
the option term (ten years from the date of grant) at annualized rates of
5% and 10% (total appreciation of approximately 63% and 159%),
respectively, and therefore are not intended to forecast possible future
appreciation, if any, in the price of the Common Stock.
14
Stock Option Exercises and Holdings Table. The following table provides
information concerning the exercise of options and value of unexercised
options held by the named executive officers at January 2, 2000:
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Shares
Acquired Number of Value of Unexercised
on Value Unexercised Options In-the-Money Options
Exercise Realized at Fiscal Year End at Fiscal Year End
Name (#) ($) (#) ($)(1)
- ----------------------------------------------------------------------------
Exercis- Unexercis- Exercis- Unexercis-
able Able able able
- ----------------------------------------------------------------------------
Stephen V. - - 180,000 120,000 520,000 280,000
Clark
David G. - - 95,000 55,000 154,375 111,250
Lloyd
Douglas - - 35,000 65,000 103,750 180,625
Gammon
Dennis - - 15,000 60,000 113,750 112,500
Greenia
- ----------------------------------------------------------------------------
(1)Values stated are based on the last sale price of $8.125 per share of the
Company's Common Stock on the NASDAQ National Market System on December 31,
1999, the last trading day of the fiscal year, and equal the aggregate amount
by which the market value of the option shares exceeds the exercise price of
such options at the end of the fiscal year.
Compensation Committee Interlocks and Insider Participation
None.
15
STOCK PERFORMANCE GRAPH
Comparison of Five Year-Cumulative Total Returns
Performance Graph for
Taco Cabana, Inc.
(GRAPH APPEARS HERE)
Measurement NASDAQ Stock NASDAQ Stocks
Period(Fiscal Taco Cabana, Market (SIC 5800-5899 US Companies)
Year Covered) Inc. (US Companies) Eating and drinking places
- -----------------------------------------------------------------------------
12/29/1995 55.6 141.3 121.8
12/27/1996 81.2 174.1 118.3
12/26/1997 51.4 205.1 100.6
12/31/1998 86.1 300.2 92.6
12/31/1999 90.3 545.7 72.5
- -----------------------------------------------------------------------------
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on
the previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a
trading day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 12/30/1994.
16
PROPOSAL 2
PROPOSAL TO APPROVE THE ADOPTION OF THE TACO CABANA, INC. 2000 STOCK
OWNERSHIP PLAN
General
Effective February 16, 2000, the Board of Directors unanimously adopted
the Taco Cabana, Inc. 2000 Stock Ownership Plan (the " 2000 Plan" ) and
directed that the 2000 Plan be submitted to the stockholders for their
approval. The following summary of the 2000 Plan is qualified in its
entirety by reference to the text of such Plan, which is set forth in
Appendix A.
Summary of the 2000 Plan
Under the 2000 Plan, options, restricted stock and performance units may
be granted to employees and directors of, and consultants and advisors to,
the Company or a subsidiary corporation or entity. The number of shares of
common stock reserved for issuance is 500,000 shares. The 2000 Plan is
intended to permit the Company to retain and attract qualified individuals
who will contribute to its overall success. Shares that by reason of the
expiration of an option (other than by reason of exercise) or which are no
longer subject to purchase pursuant to an option or other benefit granted
under the 2000 Plan may be reoptioned thereunder. The 2000 Plan will be
administered by the Compensation and Stock Option Committee (the
"Committee" ). The Committee will set the specific terms and conditions of
options or other benefit granted under the 2000 Plan.
STOCK OPTIONS
The Company's employees will be eligible to receive incentive stock
options or nonqualified stock options or a combination of both, as the
Committee determines. Non-employee participants may be granted only
nonqualified stock options. Stock options may be granted for a term not to
exceed ten years (five years with respect to a holder of 10% or more of the
Company's shares in the case of an incentive stock option) and are not
transferable other than by will or the laws of descent and distribution.
Each option may be exercised within the term of the option pursuant to which
it is granted (so long as the optionee, if an employee, continues to be
employed by the Company). In addition, unless a shorter period is specified
in a particular option agreement, an option may be exercised within 90 days
after the termination of employment of the optionee (subject to any
limitations in the particular option), within one year after termination in
case of termination because of disability, or throughout the term of the
option in the event of the optionee's death, to the extent in each case the
option was exercisable at the termination date.
17
The exercise price of all nonqualified stock options must be at least
equal to 100% of the fair market value of the Common Stock on the date of
grant. The exercise price of all incentive stock options must be at least
equal to 100% of the fair market value of the Common Stock on the date of
grant, or 110% of the fair market value with respect to any incentive stock
option issued to a holder of 10% or more of the Company' shares. Stock
options may be exercised by payment in cash of the exercise price with
respect to each share to be purchased or by delivering Common Stock of the
Company already owned by such optionee with a market value equal to the
exercise price, or by a method of which a concurrent sale for the acquired
stock is arranged, with the exercise price payable in cash from such sale
proceeds. The maximum number of shares in respect of which Options may be
granted to a Participant during any calendar year shall be 250,000 shares.
RESTRICTED STOCK/PERFORMANCE UNITS
Restricted stock consists of shares of Common Stock that are sold or
transferred by the Company to a participant at a price that may be below
their fair market value or for no payment, but subject to restrictions on
their sale or other transfer by the participant. The maximum number of
shares of restricted stock issued under the 2000 Plan that may be awarded to
any participant in any calendar year is 100,000 shares.
Performance units are rights to receive a payment from the Company that
may be payable in cash or shares of Common Stock or both, provided certain
performance standards are met. The goals ("Performance Goals" ) that are to
be achieved with respect to each performance unit shall be those objectives
established by the Committee as it deems appropriate. The Committee
determines the number of performance units to be granted. The maximum
payment that can be made pursuant to performance units allocated to a
participant in a calendar year is $1,000,000. Moreover, the Committee is
required to certify that the Performance Goals have been satisfied prior to
payments with respect to any units.
The 2000 Plan will terminate on February 7, 2010. The Board of Directors
may, however, terminate the 2000 Plan at any time prior to such date.
Termination of the 2000 Plan will not alter or impair, without the consent
of the optionee, any of the rights or obligations pursuant to any option
granted under the 2000 Plan.
Federal Income Tax Consequences
The 2000 Plan is not qualified under the provisions of Section 401(a) of
the Code, nor is it subject to any of the provisions of the Employee
Retirement Income Security Act of 1974, as amended.
NON-QUALIFIED STOCK OPTIONS ("NQSO" )
The granting of a NQSO does not produce taxable income to the optionee or
a tax deduction to the Company. Taxable ordinary income generally will be
recognized by the optionee at the time of exercise in an amount equal to the
excess of the fair market value of the shares purchased at the time of
exercise over the aggregate option price. The Company is entitled to a
corresponding Federal income tax deduction. The tax basis for the shares
acquired is the option price plus the taxable income recognized.
INCENTIVE STOCK OPTIONS ("ISO" )
18
In the case of an ISO, an optionee will not recognize any taxable income
at the time of grant and the Company will not be entitled to a Federal
income tax deduction. No income will be recognized by an optionee at the
time of exercise of the ISO. If the optionee holds the shares acquired upon
exercise of the ISO for at least two years from the date of grant of the ISO
and at least one year from the date of exercise, the optionee would realize
taxable long-term capital gain or loss upon a subsequent sale of the shares
at a price different from the option price. If the foregoing holding period
is met, no deduction would be allowed to the Company for Federal income tax
purposes at any time. If, however, the optionee disposes of the shares
prior to satisfying the required holding period, generally (1) the optionee
would realize ordinary income in the year of such disposition in an amount
equal to the difference between (a) the fair market value of such shares on
the date of exercise or (b) the sales price, whichever is less, and the
option price; (2) the Company would be entitled to a deduction for such year
in the amount of the ordinary income so realized; and (3) the optionee would
realize capital gain in an amount equal to the difference between (a) the
amount realized upon the sale of the shares and (b) the option price plus
the amount of ordinary income, if any, realized upon the disposition.
RESTRICTED STOCK
In the absence of an election under section 83(b) of the Code ("Section
83(b) Election"), a participant who receives restricted stock will recognize
no income at the time of issuance. When the restriction period expires
with respect to shares of restricted stock, a participant will recognize
ordinary income equal to the fair market value of the shares as of the date
the restrictions expire over the amount paid for such shares (if any). The
participant's basis for the shares is equal to the amount paid (if any) plus
the ordinary income recognized, and the holding period begins just after the
restriction period ends. An employee may, however, make a Section 83(b)
Election to include in income in the year of purchase or grant the excess of
the fair market value of the shares (computed without regard to the
restrictions) on the date of purchase or grant over their purchase price.
The Company will be entitled to a deduction in the same year and in the same
amount as income is recognized by the participant. If a Section 83(b)
Election is made, a participant's basis for the shares will be the amount
paid for the shares, if any, plus the ordinary income recognized.
PERFORMANCE UNITS
Generally, performance units granted to a participant will be taxable to
the participant in the amount of cash and the fair market value of shares
received. The Company will be entitled to a deduction for such amount at
the time it is includible in the income of the participant.
19
In accordance with Section 162(m) of the Code, the Company's tax
deductions for compensation paid to the most highly paid executives named in
the Company's Proxy Statement may be limited to no more than $1 million per
year, excluding certain "performance-based" compensation. The Company
intends for the stock option and performance unit awards under the 2000 Plan
to comply with the requirement for an exception to Section 162(m) of the
Code so that the amount of the Company's deduction for compensation related
to the stock option and performance unit awards under the 2000 Plan would
not be limited by Section 162(m) of the Code.
The discussion set forth above does not purport to be a complete analysis
of the potential tax consequences relevant to the Optionees or to the
Company, or to describe tax consequences based on particular circumstances.
It is based on Federal income tax law and interpretational authorities as of
the date of this Proxy Statement, which are subject to change at any time.
The affirmative vote of a majority of the shares of Common Stock present
and entitle to vote at the Meeting is required to approve the 2000 Plan.
The enclosed from of Proxy provides a means for shareholders to vote for the
2000 Plan, to vote against it or to abstain from voting with respect to it.
Each Proxy received in time for the Meeting will be voted as specified
therein. If a shareholder executes and returns a Proxy, but does not
specify how the shares represented by such shareholder's Proxy are to be
voted, such shares will be voted FOR the approval of the 2000 Plan. In
determining whether this proposal has received the requisite number of
affirmative votes, abstentions will be counted and will have the same effect
as a vote against this proposal. Broker non-votes will not be counted and
will have no effect.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" APPROVAL
OF THE 2000 PLAN.
20
INDEPENDENT ACCOUNTANTS
The financial statements and schedules of the Company as of January 2,
2000 and for the year then ended were audited by Deloitte & Touche LLP. It
is anticipated that if the nominees are elected as directors, the new Board
of Directors will reappoint such firm as independent certified public
accountants for the current fiscal year. A representative of Deloitte &
Touche LLP will be present at the Meeting, will have an opportunity to make
a statement if he or she desires to do so and will be available to respond
to appropriate questions.
ANNUAL REPORT
The Company's Annual Report for the year ended January 2, 2000, which
includes the Company's financial statements, accompanies this proxy
statement, but is not incorporated as part of the proxy statement and is not
to be regarded as part of the proxy solicitation material.
OTHER MATTERS
The Company's management knows of no other matters that may properly
be, or which are likely to be, brought before the meeting. However, if any
other matters are properly brought before the meeting, the persons named in
the enclosed proxy, or their substitutes, will vote in accordance with their
best judgment on such matters.
STOCKHOLDER PROPOSALS
The Company intends to conduct the next annual meeting of stockholders
in approximately June 2001. Proposals by stockholders intended to be
presented at the annual meeting to be held in 2001 must be received by the
Company by March 1, 2001 to be included in the Company's proxy statement and
form of proxy relating to that meeting. Such proposals should be addressed
to the Secretary of the Company at the address indicated in this notice.
21
COST AND METHOD OF PROXY SOLICITATION
The accompanying Proxy is being solicited on behalf of the Board of
Directors of the Company. The expense of preparing, printing and mailing
the form of Proxy and the material used in the solicitation thereof will be
borne by the Company. In addition to the use of the mails, proxies may be
solicited by personal interview, telephone and telegram by directors,
officers and employees of the Company. Arrangements may also be made with
brokerage houses and other custodians, nominees and fiduciaries for
forwarding of solicitation materials to the beneficial owners of stock held
by such persons, and the Company may reimburse them for reasonable out-of-
pocket expenses incurred by them in connection therewith.
By Order of the Board of Directors
David G. Lloyd
Secretary
22
APPENDIX A
TACO CABANA, INC.
2000 STOCK OWNERSHIP PLAN
ARTICLE 1. PURPOSE
The purposes of this 2000 Stock Ownership Plan (the "Plan") are (i) to
provide long-term incentives and rewards to those key employees (the "Employee
Participants") of Taco Cabana, Inc. and its subsidiaries (the " Company") who
are in a position to contribute to the long-term success and growth of the
Corporation and its subsidiaries, (ii) to assist the Corporation in retaining
and attracting executives and key employees with requisite experience and
ability, and (iii) to associate more closely the interests of such executives
and key employees with those of the Corporation's stockholders.
ARTICLE 2. DEFINITIONS AND CONSTRUCTION
2.1 DEFINITIONS. As used in the Plan, terms defined parenthetically
immediately after their use shall have the respective meanings provided by such
definitions, and the terms set forth below shall have the following meanings (in
either case, such meanings shall apply equally to both the singular and plural
forms of the terms defined):
(a) "Award" shall mean, individually or collectively, a grant under the
Plan of Options, Restricted Stock or Performance Units.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" shall mean (i) the failure by a Participant to render services
to the Company, which failure amounts to gross neglect or gross insubordination,
(ii) the commission by a Participant of an act of fraud or embezzlement against
the Company, or (iii) a Participant being convicted of a felony, or failing to
contest a felony prosecution.
(d) A "Change in Control" shall mean (i) the acquisition by any person
after the date hereof of beneficial ownership of 50% or more of the voting power
of the Company's outstanding voting stock, (ii) three or more of the current
members of the Board ceasing to be members of the Board (unless any replacement
director is elected by a vote of, or pursuant to nomination by, at least 75% of
the remaining directors, or by a vote of at least 75% of the shares entitled to
vote on such replacement) or (iii) approval by the stockholders of the Company
of (a) a merger or consolidation of the Company with another corporation if the
stockholders of the Company immediately before such vote will not, as a result
of such merger or consolidation, own more than 50% of the voting stock of the
corporation resulting from such merger or consolidation, or (b) a complete
liquidation of the Company or sale of all, or substantially all, of the assets
of the Company. Notwithstanding the foregoing, a Change in Control shall not
occur solely because 50% or more of the voting stock of the Company is acquired
by (i) a trust which is part of an employee benefit plan maintained by the
Company or its Subsidiaries or (ii) a corporation which, immediately following
such acquisition, is owned directly or indirectly by the stockholders of the
Company in the same proportion as their ownership of stock in the Company
immediately prior to such acquisition.
23
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor thereto.
(f) "Committee" shall mean the committee described in Section 3.1.
(g) "Common Stock" shall mean shares of the Company's common stock, par
value $.01 per share.
(h) "Company" shall mean Taco Cabana, Inc., a Delaware corporation.
(i) "Disability" shall mean a physical or mental infirmity that the
Committee determines impairs the Participant's ability to substantially perform
his or her duties for a period of 180 consecutive days.
(j) "Effective Date" shall mean February 16, 2000, the date the Plan was
adopted by the Board.
(k) "Employee" shall mean an individual who is a full-time or part-time
employee of the Company or a Subsidiary.
(l) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
(m) "Fair Market Value" of a share of Common Stock shall mean, as of any
applicable date, the closing sale price of the Common Stock on the NASDAQ
National Market System or any national or regional stock exchange on which the
Common Stock is then traded. If no such reported sale of the Common Stock shall
have occurred on such date, Fair Market Value shall mean the closing sale price
of the Common Stock on the next preceding date on which there was a reported
sale. If the Common Stock is not listed on the NASDAQ National Market System or
a national or regional stock exchange, the Fair Market Value of a share of
Common Stock as of a particular date shall be determined by such method as shall
be determined by the Committee.
(n) "ISOs" shall have the meaning given such term in Section 6.1.
(o) "NQSOs" shall have the meaning given such term in Section 6.1.
(p) "Option" shall mean an option to purchase shares of Common Stock
granted pursuant to Article 6.
(q) "Option Agreement" shall mean an agreement evidencing the grant of an
Option as described in Section 6.2.
(r) "Option Exercise Price" shall mean the purchase price per share of
Common Stock subject to an Option, which shall not be less than the Fair Market
Value on the date of grant.
(s) "Participant" shall mean any Employee or any consultant or advisor
providing services to the Company or a Subsidiary selected by the Committee to
receive an Award under the Plan; provided, however, that any such consultant or
advisor must be a natural person providing bona fide services to the Company,
which services are not in connection with the offer or sale of securities in a
capital-raising transaction and do not directly or indirectly promote or
maintain a market for the Company's securities.
(t) "Performance Goals" shall have the meaning given such term in Section
8.4.
24
(u) "Performance Period" shall have the meaning given such term in Section
8.3.
(v) "Performance Unit" shall mean the right to receive a payment from the
Company upon the achievement of specified Performance Goals as set forth in a
Performance Unit Agreement.
(w) "Performance Unit Agreement" shall mean an agreement evidencing a
Performance Unit Award, as described in Section 8.2.
(x) "Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and as used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d).
(y) "Plan" shall mean this Taco Cabana, Inc. 2000 Stock Ownership Plan as
the same may be amended from time to time.
(z) "Restriction Period" shall mean the period determined by the Committee
during which the transfer of shares of Common Stock is limited in some way or
such shares are otherwise restricted or subject to forfeiture as provided in
Article 7.
(aa) "Restricted Stock" shall mean shares of Common Stock granted pursuant
to Article 7 as to which the restrictions have not lapsed.
(ab) "Restricted Stock Agreement" shall mean an agreement evidencing a
Restricted Stock Award, as described in Section 7.2.
(ac) "Retirement" shall mean retirement by a Participant in accordance with
the terms of the Company's retirement or pension plans, if any, or, if the
Company has no such plans, then retirement after reaching age 65.
(ad) "Subsidiary" shall mean, with respect to any company, any corporation
or other Person of which a majority of its voting power, equity securities, or
equity interest is owned, directly or indirectly, by such company.
2.2 GENDER AND NUMBER. Unless otherwise indicated by the context,
reference to the masculine gender shall include the feminine gender, the plural
shall include the singular and the singular shall include the plural.
2.3 SEVERABILITY. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.
ARTICLE 3. ADMINISTRATION
3.1 THE COMMITTEE. The Plan shall be administered by the Compensation
Committee of the Board, or by any other committee (the "Committee") appointed by
the Board consisting of two or more directors of the Company. It is intended
that each Committee member shall be a "non-employee director" within the meaning
of Rule 16b-3 under the Exchange Act and an "outside director" within the
meaning of Section 162(m) of the Code. The members of the Committee shall be
appointed from time to time by, and shall serve at the discretion of, the Board.
3.2 AUTHORITY OF THE COMMITTEE. Subject to the provisions of the Plan,
the Committee shall have full authority to:
25
(a) select Participants to whom Awards are granted;
(b) determine the size, type and frequency of Awards granted under the
Plan;
(c) determine the terms and conditions of Awards, including any
restrictions, conditions or forfeiture provisions relating to the Award, which
need not be identical;
(d) determine whether and the extent to which Performance Goals have been
met;
(e) determine whether and when a Participant's status as an Employee,
consultant, or advisor has terminated for purposes of the Plan;
(f) cancel or modify, with the consent of the Participant, outstanding
Awards and grant new Awards in substitution therefore;
(g) accelerate the exercisability of, and accelerate or waive any or all
the restrictions and conditions applicable to, any Award, for any reason;
(h) extend the duration of an Option exercise period or term of an Award;
(i) construe and interpret the Plan and any agreement or instrument entered
into under the Plan;
(j) establish, amend and rescind rules and regulations for the Plan's
administration; and
(k) amend the terms and conditions of any outstanding Award to the extent
such terms and conditions are within the discretion of the Committee as provided
in the Plan.
The Committee shall have sole discretion to make all other determinations which
may be necessary or advisable for the administration of the Plan. To the extent
permitted by law and Rule 16b-3 promulgated under the Exchange Act, the
Committee may delegate its authority. Notwithstanding the foregoing, the
Committee may not delegate its responsibilities hereunder if such delegation
would jeopardize compliance with the "outside directors" requirement or any
other applicable requirement under Section 162(m) of the Code.
3.3 DECISIONS BINDING. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan, and all related orders or
resolutions of the Board, shall be final, conclusive and binding upon all
persons, including the Company, its stockholders, Employees, Participants and
their estates and beneficiaries.
3.4 SECTION 16 COMPLIANCE; BIFURCATION OF PLAN. It is the intention of
the Company that the Plan and the administration of the Plan comply in all
respects with Section 16(b) of the Exchange Act and the rules and regulations
promulgated thereunder. If any Plan provision, or any aspect of the
administration of the Plan, is found not to be in compliance with Section 16(b)
of the Exchange Act, the provision or administration shall be deemed null and
void, and in all events the Plan shall be construed in favor of its meeting the
requirements of Rule 16b-3 promulgated under the Exchange Act. Notwithstanding
anything in the Plan to the contrary, the Board or the Committee, in its
discretion, may bifurcate the Plan so as to restrict, limit or condition the use
26
of any provision of the Plan to Participants who are subject to Section 16 of
the Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.
ARTICLE 4. SHARES AVAILABLE UNDER THE PLAN
4.1 NUMBER OF SHARES. Subject to adjustment as provided in Section 4.3,
the number of shares of Common Stock reserved for issuance under the Plan is
500,000 shares. Shares as to which options or other Awards granted under the
Plan lapse, expire, terminate, are forfeited or are canceled shall again become
available for Awards under the Plan. In addition, any shares of Common Stock
reserved for issuance under the Company's 1994 Stock Option Plan as amended
("1994 Plan") in excess of the number of shares as to which options or other
benefits are awarded thereunder, plus any shares as to which options or other
benefits granted under the 1994 Plan may lapse, expire, terminate or be
canceled, shall also be reserved and available for issuance or reissuance under
the Plan. Any Common Stock issued under the Plan may consist, in whole or in
part, of authorized and unissued shares or treasury shares.
4.2 SHARES OF RESTRICTED STOCK AVAILABLE UNDER THE PLAN. Subject to
adjustment as provided in Section 4.3, the number of shares of Common Stock
which may be the subject of Awards granted in the form of Restricted Stock is
limited to 100,000 shares.
4.3 ADJUSTMENTS IN AUTHORIZED SHARES AND OUTSTANDING AWARDS. In the event
of any change in the corporate structure of the Company affecting the Common
Stock, including a merger, reorganization, consolidation, recapitalization,
reclassification, split-up, spin-off, separation, liquidation, stock dividend,
stock split, reverse stock split, share repurchase, share combination, share
exchange, issuance of warrants or debentures, the Committee may substitute or
adjust the total number and class of shares of Common Stock or other stock or
securities which may be issued under the Plan, and the number, class and price
of shares subject to outstanding Awards, as it, in its discretion, determines to
be appropriate and equitable to prevent dilution or enlargement of the rights of
Participants and to preserve, without exceeding, the value of any outstanding
Awards; provided, however, that the number of shares subject to any Award shall
always be a whole number. In the case of ISOs, such adjustment shall be made so
as not to result in a "modification" within the meaning of Section 424(h) of the
Code.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
All Employees of the Company and its Subsidiaries and consultants or other
advisors providing services to the Company or a Subsidiary are eligible to
receive Awards under the Plan. In selecting Employees, consultants or advisors
to receive Awards under the Plan, as well as in determining the number of shares
subject to, and the other terms and conditions applicable to, each Award, the
Committee shall take into consideration such factors as it deems relevant in
promoting the purposes of the Plan, including the duties and responsibilities of
such persons, their present and potential contribution to the success of the
Company and their anticipated number of years of active service or contribution
remaining with the Company or a Subsidiary.
ARTICLE 6. STOCK OPTIONS
6.1 GRANT OF OPTIONS. Subject to the terms and provisions of the Plan,
the Committee may grant Options to Participants at any time and from time to
time, in the form of options which are intended to qualify as incentive stock
27
options within the meaning of Section 422 of the Code ("ISOs"), Options which
are not intended to so qualify ("NQSOs") or a combination thereof.
Notwithstanding the foregoing, ISOs may only be granted to Employees of the
Company and its subsidiaries (within the meaning of Section 424(f) of the Code).
The maximum number of shares in respect of which Options may be granted to a
Participant during any calendar year shall be 250,000 shares.
6.2 OPTION AGREEMENT. Each Option shall be evidenced by an Option
Agreement that shall specify the Option Exercise Price, the duration of the
Option, the number of shares to which the Option relates, forfeiture provisions
as deemed appropriate by the Committee and such other provisions as the
Committee may determine or which are required by the Plan. The Option Agreement
shall also specify whether the Option is intended to be an ISO or a NQSO and
shall include provisions applicable to the particular type of Option granted.
6.3 DURATION OF OPTIONS. Subject to the provisions of Section 6.7, each
Option shall expire at such time as is determined by the Committee at the time
of grant; provided, however, that no Option shall at the time of grant be
exercisable later than the tenth anniversary of its grant.
6.4 EXERCISE OF OPTIONS. Options shall be exercisable at such times and
be subject to such restrictions and conditions, including forfeiture provisions,
as the Committee shall approve at the time of grant, which need not be the same
for each grant or for each Participant. Options shall be exercised by delivery
to the Company of a written notice of exercise, setting forth the number of
shares with respect to which the Option is to be exercised and accompanied by
full payment of the Option Exercise Price and all applicable withholding taxes.
6.5 PAYMENT OF OPTION EXERCISE PRICE. The Option Exercise Price for
shares of Common Stock as to which an Option is exercised shall be paid to the
Company in full at the time of exercise either (a) in cash in the form of
currency or other cash equivalent acceptable to the Company, (b) by tendering
Common Stock having a Fair Market Value (at the close of business on the date
the Company receives the notice of exercise) equal to the Option Exercise Price,
(c) any other reasonable consideration that the Committee may deem appropriate
or (d) by a combination of the forms of consideration described in (a), (b) and
(c) of this Section. The Committee may permit the cashless exercise of Options
as described in Regulation T promulgated by the Federal Reserve Board, subject
to applicable securities law restrictions, or by any other means which the
Committee determines to be consistent with the Plan's purpose and applicable
law.
6.6 VESTING UPON CHANGE IN CONTROL. Upon a Change in Control, any then
outstanding Options held by Participants shall become fully vested and
immediately exercisable.
6.7 TERMINATION OF EMPLOYMENT. If the Participant's status as an
Employee, consultant or advisor is terminated for Cause, all then outstanding
Options of such Participant, whether or not exercisable, shall terminate
immediately. If the Participant's status as an Employee, consultant or advisor
is terminated for any reason other than for Cause, death, Disability or
Retirement, to the extent then outstanding Options of such Participant are
exercisable and subject to the provisions of the relevant Option Agreement, such
Options may be exercised by such Participant or his personal representative at
any time prior to the earlier of (a) the expiration date of the Options or (b)
the date which is 90 days after the date of such termination of employment. In
the event of the Retirement of a Participant, to the extent then outstanding
Options of such Participant are exercisable, such Options may be exercised by
28
the Participant (c) in the case of NQSOs, within one year after the date of
Retirement and (d) in the case of ISOs, within 90 days after Retirement;
provided, however, that no such Options may be exercised on a date subsequent to
their expiration. In the event of the death or Disability of a Participant
while employed by the Company or a Subsidiary or while the Participant is
serving as a consultant or advisor to the Company or a Subsidiary, all then
outstanding Options of such Participant shall become fully vested and
immediately exercisable, and may be exercised at any time within one year after
the date of death or determination of Disability; provided however that no such
Options may be exercised on a date subsequent to their expiration. Options may
be exercised as provided in this Section (a) in the event of the death of a
Participant, by the person or persons to whom rights pass by will or by the laws
of descent and distribution, or if appropriate, the legal representative of the
decedent's estate and (b) in the event of the Disability of a Participant, by
the Participant, or if such Participant is incapacitated, by the Participant's
legal representative.
ARTICLE 7. RESTRICTED STOCK
7.1 GRANT OF RESTRICTED STOCK. Subject to the terms and provisions of the
Plan, the Committee may grant shares of Restricted Stock to Participants at any
time and from time to time and upon such terms and conditions as it may
determine. The purchase price for shares of Restricted Stock shall be
determined by the Committee, but shall not be less than the par value of the
Common Stock, except in the case of treasury shares, for which no payment need
be required.
7.2 RESTRICTED STOCK AGREEMENT. Each Restricted Stock grant shall be
evidenced by a Restricted Stock Agreement which shall specify the Restriction
Period, the number of shares of Restricted Stock granted and such other
provisions as the Committee may determine and which are required by the Plan.
7.3 NON-TRANSFERABILITY OF RESTRICTED STOCK. Except as provided in this
Article 7 or the applicable Restricted Stock Agreement, shares of Restricted
Stock may not be sold, transferred, pledged, assigned or otherwise alienated or
hypothecated until the end of the applicable Restriction Period as specified in
the Restricted Stock Agreement and the satisfaction of any other conditions
determined at the time of grant specified in the Restricted Stock Agreement.
Except as provided in Section 7.9, however, in no event may any Restricted Stock
become vested in a Participant subject to Section 16(b) of the Exchange Act
prior to six months following the date of its grant.
7.4 OTHER RESTRICTIONS. The Committee shall impose such other
restrictions on shares of Restricted Stock as it may deem advisable, including,
without limitation, restrictions based upon the achievement of specific
performance goals (relating to the Company, a Subsidiary or regional or other
operating division of the Company), years of service and/or restrictions under
applicable Federal or state securities laws. The Committee may provide that any
share of Restricted Stock shall be held (together with a stock power executed in
blank by the Participant) in custody by the Company until any or all
restrictions thereon shall have lapsed.
7.5 FORFEITURE. The Committee shall determine and set forth in a
Participant's Restricted Stock Agreement such events upon which a Participant's
shares of Restricted Stock (or the proceeds of a sale thereof) shall be
forfeitable, which may include, without limitation, the termination of a
Participant's employment and certain other activities.
29
7.6 CERTIFICATE LEGEND. In addition to any legends placed on certificates
pursuant to Section 7.4, each certificate representing shares of Restricted
Stock shall bear the following legend:
"The sale or other transfer of the shares represented by this Certificate,
whether voluntary, involuntary or by operation of law, is subject to
certain restrictions on transfer as set forth in the Taco Cabana, Inc. 2000
Stock Ownership Plan, and in the related Restricted Stock Agreement. A
copy of the Plan and such Restricted Stock Agreement may be obtained from
the Secretary of Taco Cabana, Inc."
7.7 REMOVAL OF RESTRICTIONS. Except as otherwise provided in this Article
7 or the Restricted Stock Agreement, shares of Restricted Stock shall become
freely transferable by the Participant and no longer subject to forfeiture after
the last day of the Restriction Period. Once the shares of Restricted Stock are
released from their restrictions (including forfeiture provisions), the
Participant shall be entitled to have the legend required by Section 7.6 removed
from the Participant's share certificate, which certificate shall thereafter
represent freely transferable and nonforfeitable shares of Common Stock free
from any and all restrictions under the Plan but subject to restrictions on
transfer, if any, existing as a matter of federal or state securities laws.
7.8 VOTING RIGHTS; DIVIDENDS AND OTHER DISTRIBUTIONS. Unless the
Committee exercises its discretion as provided in Section 7.10, during the
Restriction Period, Participants holding shares of Restricted Stock may exercise
full voting rights, and shall be entitled to receive all dividends and other
distributions paid with respect to such Restricted Stock. If any dividends or
distributions are paid in Common Stock, such Common Stock shall be subject to
the same restrictions as the shares of Restricted Stock with respect to which
they were paid.
7.9 LAPSE OF RESTRICTIONS UPON CHANGE IN CONTROL. Upon a Change in
Control, any restrictions and other conditions pertaining to then outstanding
shares of Restricted Stock held by Participants, including, but not limited to,
vesting requirements, shall lapse and such shares shall thereafter be
immediately transferable and nonforfeitable.
7.10 TREATMENT OF DIVIDENDS. At the time shares of Restricted Stock are
granted to a Participant, the Committee may, in its discretion, determine that
the payment of dividends, or a specified portion thereof, declared or paid on
such shares shall be deferred until the lapse of the restrictions with respect
to such shares, such deferred dividends to be held by the Company for the
account of the Participant. In the event of such deferral, there may be
credited at the end of each year (or portion thereof) interest on the amount of
the account during the year at a rate per annum as the Committee, in its
discretion, may determine. Deferred dividends, together with interest accrued
thereon, if any, shall be (a) paid to the Participant upon the lapse of
restrictions on the shares of Restricted Stock as to which the dividends related
or (ii) forfeited to the Company upon the forfeiture of such shares by the
Participant.
7.11 TERMINATION OF EMPLOYMENT. If the Participant's status as an
Employee, consultant or advisor is terminated for any reason other than death or
Disability prior to the expiration of the Restriction Period applicable to any
shares of Restricted Stock then held by the Participant, such shares shall
thereupon be forfeited immediately by the Participant and returned to the
Company, and the Participant shall only receive the amount, if any, paid by the
Participant for such Restricted Stock. If the Participant's status as an
30
Employee, consultant or advisor is terminated as a result of death or Disability
prior to the expiration of the Restriction Period applicable to any shares of
Restricted Stock then held by the Participant, any restrictions and other
conditions pertaining to such shares then held by the Participant, including,
but not limited to, vesting requirements, shall immediately lapse and such
shares shall thereafter be immediately transferable and nonforfeitable.
Notwithstanding anything in the Plan to the contrary, the Committee may
determine, in its sole discretion, in the case of any termination of a
Participant's status as an Employee, consultant or advisor other than for Cause,
that the restrictions on some or all of the shares of Restricted Stock awarded
to a Participant shall immediately lapse and, to the extent the Committee deems
appropriate, such shares shall thereafter be immediately transferable and
nonforfeitable.
ARTICLE 8. PERFORMANCE UNITS
8.1 GRANT OF PERFORMANCE UNITS. The Committee may, from time to time and
upon such terms and conditions as it may determine, grant Performance Units
which will become payable to a Participant upon achievement of specified
Performance Goals. The maximum payment that can be made pursuant to Performance
Units granted to any one Participant in any calendar year shall be $1,000,000.
8.2 PERFORMANCE UNIT AGREEMENT. Each Performance Unit grant shall be
evidenced by a Performance Unit Agreement that shall specify the Performance
Goals, the Performance Period and the number of Performance Units to which it
pertains.
8.3 PERFORMANCE PERIOD. The period of performance ("Performance Period")
with respect to each Performance Unit shall be such period of time, which shall
not be less than one year, nor more than five years, as determined by the
Committee, for the measurement of the extent to which Performance Goals are
attained. The Performance Period may commence prior to the date of grant of the
Performance Unit to which it relates, provided that at such time the attainment
of the Performance Goal is substantially uncertain and not more than 25% of the
Performance Period has expired.
8.4 PERFORMANCE GOALS. The goals ("Performance Goals") that are to be
achieved with respect to each Performance Unit shall be those objectives
established by the Committee as it deems appropriate, and which may relate to
the net income, growth in net income, earnings per share, growth of earnings per
share, return on equity or return on capital, of the Company, or any other
performance objectives relating to the Company, a Subsidiary or regional or
other operating unit of the Company, or the individual Participant. Each
Performance Unit Agreement shall specify a minimum acceptable level of
achievement with respect to the Performance Goals below which no payment will be
made and shall set forth a formula for determining the payment to be made if
performance is at or above such minimum based upon a range of performance levels
relating to the Performance Goals. The Committee shall certify that the
Performance Goals for Awards of Performance Units under the Plan have been
satisfied prior to the determination and payment of any such incentive in
accordance with the Plan.
31
8.5 ADJUSTMENT OF PERFORMANCE GOALS. The Committee may adjust Performance
Goals and the related minimum acceptable level of achievement if, in the sole
judgment of the Committee, events or transactions occur subsequent to the date
of grant which are unrelated to the performance of the Participant and which the
Committee expects to have a substantial effect on the ability of the Participant
to attain the Performance Goals. If a Participant is promoted, demoted or
transferred to a Subsidiary or different operating division of the Company
during a Performance Period, then, to the extent that the Committee determines
the Performance Goals or Performance Period are no longer appropriate, the
Committee may, but shall not be required to, adjust, change or eliminate the
Performance Goals or the applicable Performance Period as it deems appropriate
in order to make them appropriate and comparable to the initial Performance
Goals or Performance Period. Notwithstanding the foregoing, the Committee shall
not be entitled to adjust, change or eliminate any Performance Goals or
Performance Period if the exercise of such discretion would cause the related
compensation to fail to qualify as performance-based compensation within the
meaning of Section 162(m) of the Code.
8.6 TERMINATION OF EMPLOYMENT. If the employment of a Participant shall
terminate prior to the expiration of the Performance Period for any reason other
than for death, Disability or Retirement, the Performance Units then held by the
Participant shall terminate. In the case of termination of employment by reason
of death, Disability or Retirement of a Participant prior to the expiration of
the Performance Period, any then outstanding Performance Units of such
Participant shall be payable in an amount equal to the maximum amount payable
under the Performance Unit multiplied by a percentage equal to the percentage
that would have been earned under the terms of the Performance Unit Agreement
assuming that the rate at which the Performance Goals have been achieved as of
the date of such termination of employment would have continued until the end of
the Performance Period; provided, however, that if no maximum amount payable is
specified in the Performance Unit Agreement, the amount payable shall be such
amount as the Committee shall determine is reasonable.
8.7 PAYMENT UPON CHANGE IN CONTROL. Upon a Change in Control, any then
outstanding Performance Units shall become fully vested and immediately payable
in an amount which is equal to the greater of (a) the maximum amount payable
under the Performance Unit multiplied by a percentage equal to the percentage
that would have been earned under the terms of the Performance Unit Agreement
assuming that the rate at which the Performance Goals have been achieved as of
the date of such Change in Control would have continued until the end of the
Performance Period or (b) the maximum amount payable under the Performance Unit
multiplied by the percentage of the Performance Period completed by the
Participant at the time of the Change in Control; provided, however, that if no
maximum amount payable is specified in the Performance Unit Agreement, the
amount payable shall be such amount as the Committee shall determine is
reasonable.
8.8 PAYMENT OF PERFORMANCE UNITS. Subject to such terms and conditions as
the Committee may impose, and unless otherwise provided in the Performance Unit
Agreement, Performance Units shall be payable within 90 days following the end
of the Performance Period during which the Participant attained at least the
minimum acceptable level of achievement under the Performance Goals, or 90 days
following a Change in Control, as applicable. The Committee, in its discretion,
may determine at the time of payment required in connection with a Performance
Unit whether such payment shall be made (a) solely in cash, (b) solely in shares
of Common Stock (valued at their Fair Market Value as of the close of business
on the date preceding the date of payment) or (c) any combination thereof;
provided, however, that if a Performance Unit becomes payable upon a Change in
32
Control, the Performance Unit shall be paid solely in cash. To the extent such
payment is made with shares of Common Stock, such payment could be in restricted
or unrestricted shares as determined by the Committee.
8.9 DESIGNATION OF BENEFICIARY. Each Participant may, from time to time,
name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom the right to receive payments under a Performance Unit is
to be paid in case of the Participant's death before receiving any or all such
payments. Each such designation shall revoke all prior designations by the
Participant, shall be in a form prescribed by the Company and shall be effective
only when filed by the Participant in writing with the Committee during the
Participant's lifetime. In the absence of any such designation, benefits
remaining unpaid at the Participant's death shall be paid to the Participant's
estate.
ARTICLE 9. AMENDMENT, MODIFICATION AND TERMINATION
9.1 TERMINATION DATE. The Plan shall terminate on the earliest to occur
of (a) the tenth anniversary of the Effective Date, (b) the date when all shares
of Common Stock available under the Plan shall have been acquired and the
payment of all benefits in connection with Performance Unit Awards has been made
or (c) such other date as the Board may determine in accordance with Section
9.2.
9.2 AMENDMENT, MODIFICATION AND TERMINATION. The Board may, at any time,
amend, suspend, modify or terminate the Plan provided that (a) no amendment
shall be made without stockholder approval if such approval is necessary to
satisfy any applicable tax or regulatory law or regulation and the Board
determines it is appropriate to seek stockholder approval, and (b) upon or
following the occurrence of a Change in Control no amendment may adversely
affect the rights of any Person in connection with an Award previously granted.
The Committee may amend the terms of any Award, prospectively or retroactively,
but no such amendment shall impair the rights of any Participant without such
Participant's consent. Each Option and certain Performance Units granted under
the Plan are intended to be performance-based compensation within the meaning of
Section 162(m) of the Code. The Committee shall not be entitled to exercise any
discretion otherwise authorized hereunder with respect to such Options or
Performance Units if the ability to exercise such discretion or the exercise of
such discretion itself would cause the compensation attributable to such Options
or Performance Units to fail to qualify as performance-based compensation.
9.3 AWARDS PREVIOUSLY GRANTED. No amendment, modification or termination
of the Plan shall in any manner adversely affect any outstanding Award without
the written consent of the Participant holding such Award.
ARTICLE 10. NON-TRANSFERABILITY
A Participant's rights under this Plan may not be assigned, pledged or
otherwise transferred other than by will or the laws of descent and
distribution, except that upon a Participant's death, the Participant's rights
to payment pursuant to a Performance Unit may be transferred to a beneficiary
designated in accordance with Section 8.9. Notwithstanding anything herein to
the contrary, in the case of NQSOs, the Committee may, in its sole discretion,
by appropriate provisions in the Participant's Option Agreement, permit the
Participant to transfer all or a portion of the Option, without consideration,
to (i) the Participant's spouse or lineal descendants ("Family Members"), (ii) a
trust for the exclusive benefit of Family Members, (iii) a charitable remainder
trust of which the Participant and/or Family Members are the exclusive
33
beneficiaries (other than the charitable beneficiary), or (iv) a partnership or
a limited liability company in which the Participant and Family Members are the
sole partners or members, as applicable. In the event that any Option is
transferred by a Participant in accordance with the provisions of the
immediately preceding sentence, then subsequent transfers of the Option by the
transferee shall be prohibited. For purposes of the Option Agreement and the
Plan, the term "Optionee" shall be deemed to refer to the transferee wherever
applicable, and the provisions of Section 6.7 regarding termination of
employment shall refer to the Participant, not the transferee, but the
transferee shall be permitted to exercise the Option during the period provided
for in Section 6.7 and the Participant's Option Agreement following the
Participant's termination of employment.
ARTICLE 11. NO GRANTING OF EMPLOYMENT RIGHTS
Neither the Plan, nor any action taken under the Plan, shall be construed
as giving any person the right to become a Participant, nor shall participation
in, or any grant of an Award under, the Plan be construed as giving a
Participant any right with respect to continuance of employment or service by or
to the Company. The Company expressly reserves the right to terminate, whether
by dismissal, discharge or otherwise, a Participant's employment or consulting
or other business relationship at any time, with or without Cause, except as may
otherwise be expressly provided by any written agreement between the Company and
the Participant.
ARTICLE 12. WITHHOLDING
12.1 TAX WITHHOLDING. A Participant shall remit to the Company an amount
sufficient to satisfy Federal, state and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any grant, exercise or lapse of restrictions made under, or occurring as a
result of, the Plan.
12.2 SHARE WITHHOLDING. If the Company has a withholding obligation upon
the issuance of Common Stock under the Plan, a Participant may, subject to the
discretion of the Committee, elect to satisfy the withholding requirement, in
whole or in part, by having the Company withhold shares of Common Stock having a
Fair Market Value on the date the withholding tax is to be determined equal to
the amount required to be withheld under applicable law. Notwithstanding the
foregoing, the Committee may, by the adoption of rules or otherwise, modify the
provisions of this Section 12.2 or impose such other restrictions or limitations
on such elections as may be necessary to insure that such elections will be
exempt transactions under Section 16(b) of the Exchange Act.
ARTICLE 13. INDEMNIFICATION
No member of the Board or the Committee, nor any officer or Employee acting
on behalf of the Board or the Committee, shall be personally liable for any
action, determination or interpretation taken or made with respect to the Plan,
and all members of the Board, the Committee and each and any officer or Employee
of the Company acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company with respect to any such action,
determination or interpretation.
ARTICLE 14. SUCCESSORS
All obligations of the Company with respect to Awards granted under the
Plan shall be binding on any successor to the Company, whether the existence of
34
such successor is a result of a direct or indirect purchase, merger,
consolidation or otherwise, of all or substantially all of the business or
assets of the Company.
ARTICLE 15. GOVERNING LAW
The Plan shall be governed by, and construed in accordance with, the laws
of the State of Delaware without regard to its conflict of laws rules; provided,
however, that with respect to ISOs, the Plan and all agreements under the Plan
shall be construed so that they qualify as incentive stock options within the
meaning of Section 422 of the Code.
35
TACO CABANA, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF STOCKHOLDERS ON TUESDAY, JUNE 6, 2000
The undersigned hereby appoints STEPHEN CLARK and DAVID G. LLOYD, and each of
them, proxies, with the powers the undersigned would possess if personally
present, and with full power of substitution, to vote, at the annual meeting and
at any adjournment thereof, all shares of Common stock of the undersigned in
Taco Cabana, Inc. held of record on the record date, upon all subjects that may
properly come before the meeting, including the matters described in the proxy
statement furnished herewith, subject to any directions indicated on this card.
If no directions are given and the signed card is returned, the proxies will
vote FOR the election of each director candidate nominated for election pursuant
to item 1 and FOR item 2 and at their direction on any other matter that may
properly come before the meeting any adjourment therof.
Instruction (change of address)
To withold authority to vote for any ________________________________
individual nominee, strike a line through ________________________________
the nominee's name in the list below: ________________________________
________________________________
Stephen V. Clark William Nimmo (If you have written in the above
Richard Sherman Cecil Schenker space, please mark the
Lionel Sosa Rod Sands corresponding box on the reverse
side of this card)
No. SEE REVERSE SIDE
TACO CABANA, INC.
PLEASE MARK IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY
The Board of Directores recommends a vote FOR items 1 and 2.
WITHHELD
FOR AUTHORITY
1. Election of Directors
(see reverse)
2. To approve the adoption of the FOR AGAINST ABSTAIN
2000 Stock Ownership Plan
Note: Please sign exactly as name appears on the certificate. When shares are
held by joint tenants, both should sign, if a corporation, please sign in full
corporate name by president or other authorized officer, if a partnership please
sign in partnership name by authorized person. When signing as attorney,
trustee, guardian, officer or partner, please give full name as such.
_______________________
Signature Date
_______________________
Signature Date