SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
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Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Classic Bancshares, 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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|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
_____________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_____________________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
_____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
|_| Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or schedule
and the date of its filing.
1) Amount previously paid: _________________________________________________
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4) Date filed: _____________________________________________________________
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*Set forth the amount on which the filing fee is calculated and state how it was
determined.
(032796DTI)
June 26, 1998
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of Classic Bancshares,
Inc., I cordially invite you to attend the 1998 Annual Meeting of Stockholders.
The meeting will be held at 3:00 p.m., local time, on July 27, 1998, at the
corporate headquarters of RAM Technologies, Inc., located at 1516 Bath Avenue,
Ashland, Kentucky.
An important aspect of the meeting process is the stockholder vote on
corporate business items. I urge you to exercise your rights as a stockholder to
vote and participate in this process. Stockholders are being asked to consider
and vote upon the election of three directors, the approval of the Company's
1998 Premium Price Stock Option Growth Plan and the ratification of the
appointment of the Company's independent auditors. Your Board of Directors
unanimously recommends that you vote for each of the nominees named in the
enclosed proxy statement, for the approval of the Stock Option Growth Plan and
for the appointment of the Company's independent auditors.
In addition to the annual stockholder vote on corporate business items, the
meeting will include management's report to you on Classic Bancshares, Inc.'s
fiscal 1998 financial and operating performance.
I encourage you to attend the meeting in person. Whether or not you attend
the meeting, please read the enclosed Proxy Statement and then complete, sign
and date the enclosed proxy card and return it in the postage prepaid envelope
provided. This will save Classic Bancshares, Inc. additional expense in
soliciting proxies and will ensure that your shares are represented. Please note
that you may vote in person at the meeting even if you have previously returned
the proxy.
Thank you for your attention to this important matter.
Sincerely,
/s/David B. Barbour
David B. Barbour
President and Chief Executive Officer
CLASSIC BANCSHARES, INC.
344 Seventeenth Street
Ashland, Kentucky 41101
(606) 325-4789
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held on July 27, 1998
Notice is hereby given that the Annual Meeting of Stockholders (the
"Meeting") of Classic Bancshares, Inc. ("Classic" or the "Company") will be held
at the corporate headquarters of RAM Technologies, Inc., located at 1516 Bath
Avenue, Ashland, Kentucky at 3:00 p.m., Ashland, Kentucky time, on July 27,
1998.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of three directors of the Company;
2. The approval of the Company's 1998 Premium Price Stock Option Growth
Plan;
3. The ratification of the appointment of Smith, Goolsby, Artis & Reams,
P.S.C. as the auditors of the Company for the fiscal year ending March
31, 1999;
and such other matters as may properly come before the Meeting, or any
adjournments or postponements thereof. The Board of Directors is not aware of
any other business to come before the Meeting.
Any action may be taken on the foregoing items at the Meeting on the date
specified above, or on any date or dates to which the Meeting may be adjourned
or postponed. Stockholders of record at the close of business on June 15, 1998
are the stockholders entitled to vote at the Meeting and any adjournments or
postponements thereof. A complete list of stockholders entitled to vote at the
Meeting will be available for inspection by stockholders at the offices of the
Company during its normal business hours of 9:00 a.m. and 4:00 p.m. during the
ten days prior to the Meeting, as well as at the Meeting.
You are requested to complete, sign and date the enclosed form of proxy,
which is solicited on behalf of the Board of Directors, and to mail it promptly
in the enclosed envelope. The proxy will not be used if you attend and vote at
the Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ C. Cyrus Reynolds
C. Cyrus Reynolds
Chairman of the Board
Ashland, Kentucky
June 26, 1998
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A SELF-
ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF
MAILED WITHIN THE UNITED STATES.
PROXY STATEMENT
CLASSIC BANCSHARES, INC.
344 Seventeenth Street
Ashland, Kentucky 41101
(606) 325-4789
ANNUAL MEETING OF STOCKHOLDERS
July 27, 1998
This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors of Classic Bancshares, Inc. ("Classic" or the
"Company"), the parent company of Classic Bank and The First National Bank of
Paintsville ("Paintsville Bank") of proxies to be used at the Annual Meeting of
Stockholders of the Company (the "Meeting") which will be held at the corporate
headquarters of RAM Technologies, Inc., located at 1516 Bath Avenue, Ashland,
Kentucky on July 27, 1998, at 3:00 p.m., Ashland, Kentucky time, and all
adjournments and postponements of the Meeting. The accompanying Notice of Annual
Meeting and form of proxy and this Proxy Statement are first being mailed to
stockholders on or about June 26, 1998.
At the Meeting, stockholders of the Company are being asked to consider and
vote upon (i) the election of three directors, (ii) the approval of the
Company's 1998 Premium Price Stock Option Growth Plan (the "Stock Option Growth
Plan") and (iii) the ratification of the appointment of Smith, Goolsby, Artis &
Reams, P.S.C. as auditors for the Company for the fiscal year ending March 31,
1999.
Vote Required and Proxy Information
All shares of the Company's common stock, par value $.01 per share (the
"Common Stock"), represented at the Meeting by properly executed proxies
received prior to or at the Meeting, and not revoked, will be voted at the
Meeting in accordance with the instructions thereon. If no instructions are
indicated, properly executed proxies will be voted for the director nominees and
the proposals set forth in this Proxy Statement. The Company does not know of
any matters, other than as described in the Notice of Annual Meeting, that are
to come before the Meeting. If any other matters are properly presented at the
Meeting for action, the persons named in the enclosed form of proxy and acting
thereunder will have the discretion to vote on such matters in accordance with
their best judgment.
Directors shall be elected by a plurality of the votes cast. The approval
of the Stock Option Growth Plan and the ratification of the appointment of
Smith, Goolsby, Artis & Reams, P.S.C. as auditors for the Company both require
the affirmative vote of a majority of the votes cast on the matter. Proxies
marked to abstain with respect to a proposal have the same effect as votes
against the proposal. Votes withheld (for the election of directors) and broker
non-votes have no effect on the vote. One-third of the shares of the Common
Stock, present in person or represented by proxy, shall constitute a quorum for
purposes of the Meeting. Abstentions and broker non-votes are counted for
purposes of determining a quorum.
A proxy given pursuant to the solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary of
the Company at or before the Meeting a written notice of revocation bearing a
later date than the proxy, (ii) duly executing a subsequent proxy relating to
the same shares and delivering it to the Secretary of the Company at or before
the Meeting or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Secretary,
Classic Bancshares, Inc., 344 Seventeenth Street, Ashland, Kentucky 41101.
Voting Securities and Certain Holders Thereof
Stockholders of record as of the close of business on June 15, 1998 will be
entitled to one vote for each share of Common Stock then held. As of that date,
the Company had 1,299,590 shares of Common Stock issued and outstanding. The
following table sets forth information regarding share ownership of those
persons or entities known by management to beneficially own more than five
percent of the Common Stock and all directors and executive officers of the
Company as a group.
1
Shares
Beneficially Percent
Beneficial Owner Owned of Class
---------------- ----- --------
Classic Bancshares, Inc. Employee Stock Ownership Plan 105,800(1) 8.14%
344 Seventeenth Street
Ashland, Kentucky 41101
Charles B. Yates 80,000(2) 6.16
Craig W. Yates
Farmers and Mechanics Bank
3 Sunset Road
Burlington, New Jersey 08016
and
AFEC, Incorporated
3511 Silverside Road, Suite 105
Wilimington, Delaware 19810
Directors and executive officers of the Company as a group 187,935(3) 14.00
(12 persons)
- ----------
(1) The amount reported represents shares held by the Employee Stock Ownership
Plan ("ESOP"), 22,303 of which have been allocated to accounts of
participants. First Bankers Trust Company, N.A., Quincy, Illinois, the
trustee of the ESOP, may be deemed to beneficially own the shares held by
the ESOP which have not been allocated to accounts of participants.
Participants in the ESOP are entitled to instruct the trustee as to the
voting of shares allocated to their accounts under the ESOP. Unallocated
shares held in the ESOP's suspense account or allocated shares for which no
voting instructions are received are voted by the trustee in the same
proportion as allocated shares voted by participants.
(2) As reported by Charles B. Yates, Craig W. Yates and AFEC Incorporated
("AFEC") in a statement as of January 30, 1998 on a Schedule 13D under the
Exchange Act. Charles Yates reported sole voting and dispositive power over
26,000 shares, Craig Yates reported sole voting and dispositive power over
20,000 shares and AFEC reported sole voting and dispositive power over
34,000 shares. According to the Schedule 13D, there is no shared voting or
dispositive power with respect to any of the shares listed. Craig Yates and
Charles Yates are brothers. Craig Yates and Charles Yates together own
AFEC, and serve as its Chairman and President, respectively.
(3) Amount includes shares held directly, as well as shares held jointly with
family members, shares held in retirement accounts, 5,559 shares allocated
to the ESOP accounts of the group members, shares held in a fiduciary
capacity or by certain family members, with respect to which shares the
group members may be deemed to have sole or shared voting and/or investment
power. The amount reported above also includes 17,190 shares awarded as
restricted stock under the Company's 1996 Recognition and Retention Plan
(the "RRP") that have vested or will vest within 60 days of June 15, 1998
and 42,956 shares subject to options currently exercisable or which will
become exercisable within 60 days of June 15, 1998, awarded under the
Company's 1996 Stock Option and Incentive Plan (the "1996 Option Plan").
PROPOSAL I - ELECTION OF DIRECTORS
The Company's Board of Directors is presently composed of ten members.
Directors of the Company are generally elected to serve for a three-year term or
until their respective successors shall have been elected and shall qualify.
Approximately one-third of the directors are elected annually. Each member of
the Company's Board of Directors has served on the Board since the incorporation
of the Company in September 1995, except for Directors Robert L. Bayes and
Jeffrey P. Lopez, M.D., each of whom joined the Board in November 1996, and A.
Bruce Addington, who joined the Board in April 1998.
The following table sets forth certain information regarding the Company's
Board of Directors, including their terms of office and the nominees for
election as directors. It is intended that the proxies solicited on behalf of
the Board of Directors (other than proxies in which the vote is withheld as to
the nominee) will be voted at the Meeting for the election of the nominees
identified in the following table. If any nominee is unable to serve, the shares
represented by all such proxies will be voted for the election of such
substitute or substitutes as the Board of Directors may recommend. At this time,
the Board of Directors knows of no reason why any nominee might be unable to
serve, if elected. Except as described herein, there are no arrangements or
understandings between any director or nominee and any other person pursuant to
which such director or nominee was selected.
2
Shares of Common
Stock Beneficially Percent
Director Term to Owned at of
Name Age(1) Position(s) Held Since (2) Expire June 15, 1998(3) Class
---- ------ ---------------- --------- ------ ---------------- -----
NOMINEES
C. Cyrus Reynolds 71 Chairman of the Board 1960 2001 14,191(4) 1.10%
David B. Barbour 50 President, Chief Executive 1995 2001 44,871(5) 3.42
Officer and Director
Jeffrey P. Lopez, M.D. 39 Director 1996 2001 1,000 0.08
DIRECTORS REMAINING IN OFFICE
Robert B. Keifer, Jr. 61 Director 1991 1999 13,166 1.01
David A. Lang 54 Director 1991 1999 13,166 1.01
Robert L. Bayes 54 Executive Vice President 1996 1999 5,964(6) 0.46
and Director
A. Bruce Addington 44 Director 1998 1999 100 0.01
E.B. Gevedon, Jr. 64 Director 1980 2000 23,166(7) 1.78
Robert A. Moyer, Jr. 52 Director 1993 2000 13,166 1.01
John W. Clark 56 Director 1995 2000 21,277 1.63
- ----------
(1) At March 31, 1998.
(2) Prior to December 28, 1995, includes service as a director of Classic Bank.
(3) Includes shares held directly, as well as shares held in retirement
accounts, shares allocated to the ESOP accounts of certain of the named
persons, held by certain members of the named individuals' families, or
held by trusts of which the named individual is a trustee or substantial
beneficiary, with respect to which shares the named individuals may be
deemed to have sole or shared voting and/or investment power. The amount
also includes 5,290, 400 and 898 shares awarded as restricted stock under
the RRP, which have vested or will vest within 60 days of June 15, 1998, to
Mr. Barbour, Mr. Bayes and to each of Messrs. Gevedon, Moyer, Clark,
Reynolds, Keifer and Lang, respectively, and 13,224, 2,400, 500 and 2,268
shares subject to options which are currently exercisable or will become
exercisable within 60 days of June 15, 1998, awarded under the 1996 Option
Plan to Mr. Barbour, Mr. Bayes and Mr. Lopez and to each of Messrs.
Gevedon, Moyer, Clark, Reynolds, Keifer and Lang, respectively.
(4) Includes 1,025 shares held by Mr. Reynolds' spouse.
(5) Includes 2,885 shares allocated to Mr. Barbour's account under the ESOP.
(6) Includes 860 shares held by Mr. Bayes' spouse and 25 shares held by Mr.
Bayes' child living with him. (7) Includes 10,000 shares held by Mr.
Gevedon's spouse.
The business experience of each director of the Company for at least the
past five years is set forth below. All directors have held their positions at
least five years, except as otherwise indicated. Directors Reynolds, Barbour,
Keifer and Gevedon also serve as directors of Classic Bank. Directors Barbour,
Bayes and Gevedon also serve as directors of Paintsville Bank.
C. Cyrus Reynolds. Mr. Reynolds is Chairman of the Board of the Company and
Classic Bank, positions he has held since September 1995 and July 1990,
respectively. Mr. Reynolds serves as Property Valuation Administrator for Boyd
County, Kentucky, an elected office he has held since 1977. From 1960 to 1981,
Mr. Reynolds was the owner of Reynolds Insurance Agency, a general lines
insurance agency located in Ashland, Kentucky. Mr. Reynolds is a member and
former officer of the Ashland Lions Club and has served on various state
commissions, including 18 years of service as Chairman of the Boyd County
Democratic Party. Mr. Reynolds has also served as Treasurer of the Westwood
Christian Church for 40 years.
David B. Barbour. Mr. Barbour is the President and Chief Executive Officer
of the Company and Classic Bank, positions he has held since September 1995 and
April 1995, respectively. Prior to joining Classic Bank in March of 1995, Mr.
Barbour served as Senior Vice President and Senior Lending Officer of First
American Bank, a commercial bank located in Ashland, Kentucky with assets of
$225 million. As Senior Vice President and Senior Lending Officer, Mr. Barbour
was responsible for the bank's loan portfolio, including the commercial,
consumer and real estate lending divisions. Mr. Barbour had been employed by
First American Bank since 1977 and held a variety of management positions,
including Senior Vice President and Senior Lending Officer since 1989. Mr.
Barbour holds the designation of Certified Lender, Business Banking.
Jeffrey P. Lopez, M.D. Dr. Lopez is President of Ashland Radiation
Oncology, Inc. and owner of Tri-State Regional Cancer Center located in Ashland,
Kentucky. A native of Madison, Indiana, Dr. Lopez is a graduate of Indiana
University, obtained his medical degree from Indiana School of Medicine and
served his residency in Radiation
3
Oncology at the University of Illinois. He serves on the Board of Directors of
the Boyd County chapter of the American Cancer Society, a position he has held
since 1989. He is past President of the Boyd County Medical Society, having
served two terms as President. He is a member of the Board of Directors for the
Association of Free Standing Radiation Oncology Centers, of which he is
currently President, and is Chief of the Department of Specials at King's
Daughters' Medical Center in Ashland, Kentucky. Dr. Lopez is also President of
Liberty Holding Co., a real estate company in Ashland, Kentucky.
Robert B. Keifer, Jr. Mr. Keifer is the principal of ESP, an investment
consulting firm based in Ashland, Kentucky, a position he has held since 1992.
From 1992 to 1994, Mr. Keifer also served as a consultant to Equal Opportunity
Finance, a minority small business investment company. Mr. Keifer is a retired
group vice-president of Ashland Petroleum Company, an operating division of
Ashland, Inc., where he was employed from 1966 to 1992. Mr. Keifer also serves
on the Board of Directors of Community Hospice.
David A. Lang. Mr. Lang is Kentucky Region Director for American Electric
Power, a position he has held since January 1996. Prior to such time, he was an
Electrical Systems Director for Kentucky Power Company, a subsidiary of American
Electric Power Company, a position he held from July 1995 to January 1996. Mr.
Lang has been employed by American Electric Power since 1965 and has held a
variety of positions, including Executive Assistant from May 1990 to June 1995.
Mr. Lang is a Registered Professional Engineer in the Commonwealth of Kentucky.
Mr. Lang is also a director of the Chamber of Commerce of Boyd and Greenup
Counties and co-chair of the Conference Board's USA Quality Council V.
Robert L. Bayes. Mr. Bayes is currently President and Chief Executive
Officer of Paintsville Bank and Executive Vice President of the Company. Mr.
Bayes previously served as President of Paintsville Bank beginning in 1983. A
Certified Public Accountant, Mr. Bayes holds a B.S. in Business Administration
from Berea College, attended graduate school at the University of Kentucky and
holds a graduate banking degree from Stonier Graduate School of Banking at
Rutgers University. Mr. Bayes is a member of the American Institute of CPA's and
Kentucky Society of CPA's, a director of the Paintsville/Johnson County Chamber
of Commerce and Chairman of the Mayo State Vocational-Technical School
Foundation. Mr. Bayes is also a member of the Mayo State Vocational-Technical
School Advisory Committee.
A. Bruce Addington. Mr. Addington was appointed to the Board of Directors
of the Company in April 1998. Mr. Addington is Vice President of Addington
Enterprises, Inc., and co-founder and Secretary of Addington Exploration, Inc.
and part owner of Belize River Fruit. Addington Enterprises, Inc. is a coal
mining company headquartered in Ashland, Kentucky with operations in Eastern
Kentucky and Tennessee. Addington Exploration, Inc. is an oil and gas company
involved in exploration, production and sales.
Everett B. Gevedon, Jr. Mr. Gevedon has served as real estate consultant to
corporations and individuals throughout the eastern United States for the past
16 years. Prior to such time, he was a general real estate appraiser and
involved in real estate sales.
Robert A. Moyer, Jr. Mr. Moyer is Chairman and Chief Executive Officer of
RAM Technologies, Inc., an Ashland, Kentucky based multi-faceted communications
and technology company. Mr. Moyer has held this position since he founded the
company in 1976.
John W. Clark. Mr. Clark has been the President and Chief Executive Officer
of John W. Clark Oil Co., a company engaged in the distribution and sale of
petroleum products since its founding in 1970. In addition, he has been the
President of JRB, Inc., a common carrier trucking company, since 1977; Clark's
Pump N Stop, a convenience store, since 1978; B.J. Aviation, an airplane leasing
company, since 1990; and John W. Clark Enterprises, a real estate development
and holding company, since 1987.
Board of Directors' Meetings and Committees
Meetings of the Company's Board of Directors are generally held on a
monthly basis. The Board of Directors of the Company held 13 meetings during the
fiscal year ended March 31, 1998. No incumbent director attended fewer than 75%
of the total number of meetings held by the Board of Directors and by all
committees of the Board of Directors on which he served during the fiscal year.
4
The Board of Directors of the Company has standing Executive, Audit,
Compensation and Nominating Committees.
The Executive Committee is comprised of Directors Reynolds, Barbour, Keifer
and Gevedon. This committee meets on an as needed basis to act on matters
arising between Board meetings. This committee did not meet during fiscal 1998.
The Audit Committee reviews audit reports and related matters to ensure
effective compliance with regulations and internal policies and procedures. This
committee also acts on the recommendation by management of an accounting firm to
perform the Company's annual audit and acts as a liaison between the auditors
and the Board. Directors Keifer, Reynolds, Lang and Lopez are the current
members of this committee. The committee met four times during fiscal 1998.
The Compensation Committee establishes the Company's compensation policies
and reviews compensation matters and administers the Company's stock-based
plans. The current members of this Committee are Directors Moyer, Lang, Reynolds
and Clark. The committee held four meetings during fiscal 1998.
The Nominating Committee meets annually in order to nominate candidates for
membership on the Board of Directors. This committee is comprised of members
selected by the Chairman. This committee did not meet during fiscal 1998 as its
function was performed by the entire Board of Directors. While the Board of
Directors will consider nominees recommended by stockholders, the Committee has
not actively solicited such nominations.
Director Compensation
Director Fees. During fiscal 1998, each non-employee director of the Board
of Directors of the Company received a monthly fee of $200. During fiscal 1998,
each non-employee director of Classic Bank received a monthly fee of $400 and
the Chairman of the Board of Classic Bank received an additional $2,100 per
quarter. Each director of Paintsville Bank who was not an employee of
Paintsville Bank (including Mr. Barbour) also received a monthly fee of $400
during fiscal 1998. Directors did not receive any additional compensation during
fiscal 1998 for committee meetings attended.
For fiscal 1999, the monthly fees for service on the Boards of
Directors of the Company, Classic Bank and Paintsville Bank are $600, $250 and
$400, respectively. For fiscal 1999, directors of Classic Bank also receive $50
for each committee meeting attended. Directors of the Company who also serve as
directors of Classic Bank do not receive compensation for their service on the
Classic Bank Board. Effective April 1998, for his service as a director of
Paintsville Bank, Mr. Barbour receives a salary of $668 per month.
Retirement Plan. Classic Bank maintains a Director Retirement Plan for the
benefit of Classic Bank's outside directors. This plan provides a retirement
benefit equal to one-half of the monthly compensation paid to current directors
for a period not to exceed the earlier of the number of months of service as a
director or his death. A director must have served on the Board of Directors for
a minimum of ten years and until age 65 in order to participate in the plan. For
the fiscal year ended March 31, 1998, Classic Bank's contribution to this plan
totaled $16,423.
5
Executive Compensation
The Company has not paid any compensation to its executive officers
since its formation. The following table sets forth information concerning the
compensation paid or accrued by Classic Bank for services rendered by the
Company's and Classic Bank's President and Chief Executive Officer. No executive
officer of the Company had aggregate compensation (salary plus bonus) in excess
of $100,000 during fiscal 1998.
====================================================================================================================================
SUMMARY COMPENSATION TABLE
====================================================================================================================================
Long-Term Compensation
----------------------------
Annual Compensation Awards Payouts
--------------------------------- ------------------- -------
Other Annual Restricted Options/ LTIP
Fiscal Salary Bonus Compensation Stock SARs Payouts All Other
Name and Principal Position Year ($) ($) ($) Award($) (#) ($) Compensation($)
- ------------------------------------------------------------------------------------------------------------------------------------
David B. Barbour, President and 1998 $98,000 $17,981 (1) --- --- --- $78,692.00(3)
Chief Executive Officer and 1997 96,632 --- (1) 142,995(2) 33,062 --- 63,340.38(3)
Director 1996 83,743 --- (1) --- --- --- 39,564.18(3)
====================================================================================================================================
- ----------------
(1) Mr. Barbour has not received any additional benefits or perquisites which,
in the aggregate, have exceeded 10% of both his salary and bonus or
$50,000.
(2) Represents the dollar value of 13,225 shares of restricted stock awarded
under the RRP, based on the $10.8125 closing price per share of the Common
Stock on the Nasdaq Stock Market on July 29, 1996, the date of grant. Based
on the $20.00 closing price per share of the Common Stock on the Nasdaq
Stock Market on March 31, 1998, the aggregate value of the 10,580 shares of
restricted stock held by Mr. Barbour as of that date was $211,600.
(3) Includes, for 1998, 1997 and 1996, respectively, country club membership
fees of $0, $2,040 and $2,040 paid by Classic Bank on behalf of Mr.
Barbour, contributions made pursuant to the Supplemental Executive
Retirement Agreement between Classic Bank and Mr. Barbour of $10,166,
$11,057 and $17,931, Classic Bank's contribution to Mr. Barbour's account
under the ESOP of 2,885, 3,161 and 1,726 shares of Common Stock based upon
per share market values of $20.00, $13.375 and $11.13 on March 31, 1998,
1997 and 1996 and life insurance premiums paid by Classic Bank on behalf of
Mr. Barbour of $6,026, $5,565 and $383. Amounts for 1998 and 1997 also
include $4,800 and $2,400, respectively, in fees received by Mr. Barbour
for his service as a director of Paintsville Bank.
The following table provides information as to stock options exercised
by the President and Chief Executive Officer during the fiscal year ended March
31, 1998, and the value of the options held by the President and Chief Executive
Officer on March 31, 1998.
===================================================================================================================
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION VALUES
- -------------------------------------------------------------------------------------------------------------------
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
FY-End (#) FY-End ($)
Shares --------------------------------------------------------------
Name Acquired Value
on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
(#) ($) (#) (#) ($) ($)(1)
- -------------------------------------------------------------------------------------------------------------------
David B. Barbour --- $ --- 6,612 26,450 $60,748 $243,009
===================================================================================================================
(1) Represents the aggregate market value (market price of the Common Stock
less the exercise price) of the options held based upon the exercise prices
of the option ($10.8125 per share) and the closing price of $20.00 per
share of the Common Stock as reported on the Nasdaq Stock Market on March
31, 1998.
6
Employment Agreement
Classic Bank has entered into an employment agreement with Mr. Barbour
providing for an initial term of three years. The employment agreement became
effective upon completion of Classic Bank's conversion from mutual to stock form
and provides for an annual base salary in an amount not less than Mr. Barbour's
then-current salary and provides for an annual extension subject to the
performance of an annual formal evaluation by disinterested members of the Board
of Directors of Classic Bank. The agreement also provides for termination upon
the employee's death, for cause or in certain events specified by the
regulations of the Office of Thrift Supervision. The employment agreement is
also terminable by Mr. Barbour upon 90 days' notice to Classic Bank.
The employment agreement provides for payment to President and Chief
Executive Officer Barbour of an amount equal to 299% of his five-year average
base compensation, where employment involuntarily terminates in connection with
a "change in control" of Classic Bank or within twelve months thereafter. If the
employment of Mr. Barbour had been terminated as of March 31, 1998 under
circumstances entitling him to severance pay as described above, he would have
been entitled to receive a lump sum cash payment of approximately $277,000. The
agreement also provides for the continued payment of Mr. Barbour's health
benefits for the remainder of the term of his contract in the event he is
involuntarily terminated in the event of change in control.
Supplemental Executive Retirement Agreement
Classic Bank entered into a non-qualified Supplemental Executive Retirement
Agreement (the "Agreement") with Mr. Barbour which provides for the payment of a
monthly supplemental retirement benefit equal to up to 24% of his average
monthly compensation during the three highest 12-month periods prior to
retirement. Such benefit shall be payable upon normal retirement at age 65 or,
under certain circumstances, after age 55 if his termination is without cause.
Upon the employee's death, 50% of the amount payable under the Agreement shall
be payable to his spouse until her death. The amount contributed by Classic Bank
pursuant to the Agreement on behalf of Mr. Barbour is included in the Summary
Compensation Table.
Certain Transactions
Classic Bank and Paintsville Bank follow policies of granting loans to
their respective (and the Company's) directors, officers and employees. The
loans by Classic Bank and Paintsville Bank to executive officers and directors
are made in the ordinary course of business and on the same terms and conditions
as those of comparable transactions prevailing at the time, in accordance with
each institution's respective underwriting guidelines and do not involve more
than the normal risk of collectibility or present other unfavorable features.
Federal law requires that all loans to directors and executive officers be made
on terms and conditions comparable to those for similar transactions with
non-affiliates. Loans by Classic Bank and Paintsville Bank to all of their (and
the Company's) respective directors and executive officers and the associates of
such directors and executive officers, including outstanding balances and
commitments, totaled $4.7 million at March 31, 1998, which was 23.5% of the
Company's stockholders' equity at that date. At March 31, 1998, there were no
loans by Classic Bank or Paintsville Bank to any director or executive officer
(or any affiliate of such director or executive officer) of the Company or of
Classic Bank or Paintsville Bank, made at preferential rates or terms which in
the aggregate exceeded $60,000 during the two years ended March 31, 1998.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than 10% of a registered class of
the Company's equity securities, to file with the SEC initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Officers, directors and greater than 10% stockholders
are required by SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended March 31, 1998, all Section
16(a) filing requirements applicable to its officers, directors and greater than
10 percent beneficial owners were met.
7
PROPOSAL II--APPROVAL OF THE CLASSIC BANCSHARES, INC.
1998 PREMIUM PRICE STOCK OPTION GROWTH PLAN
The Company's Board of Directors has adopted the Classic Bancshares, Inc.
1998 Premium Price Stock Option Growth Plan (the "Stock Option Growth Plan"),
subject to approval by the Company's stockholders at the Meeting. Under the
terms of the Stock Option Growth Plan, the exercise price of a stock option or
Right (as defined below) must equal at least 110% of the market value per share
of the Common Stock as of the date of grant of such option or Right.
The purpose of the Stock Option Growth Plan is to promote the long-term
interests of the Company and its stockholders by providing a flexible and
comprehensive means for attracting and retaining directors, advisory directors,
directors emeriti, officers and employees of the Company and its corporate
affiliates.
At June 15, 1998, of the 132,500 shares of Common Stock available for
awards under the Company's 1996 Option Plan, only 5,976 shares remained. Without
approval of the Stock Option Growth Plan, the Company will soon be unable to
award any additional stock options, which the Board of Directors believes is an
essential form of compensation to attract and retain directors, officers and
employees. The Board of Directors further believes that the Company's ability to
acquire other companies may be severely impaired if the Company is unable to
award stock options to the key executives and employees of such other companies.
Accordingly, the Board of Directors unanimously recommends approval of the Stock
Option Growth Plan by the Company's stockholders.
The complete text of the Stock Option Growth Plan is attached as Appendix A
to this Proxy Statement. The principal features of the Stock Option Growth Plan
are summarized below.
General
The Stock Option Growth Plan provides for awards in the form of stock
options, stock appreciation rights ("SARs") and limited stock appreciation
rights ("Limited SARs" and together with SARs, "Rights"). Each award shall be on
such terms and conditions, consistent with the Stock Option Growth Plan, as the
committee administering the Stock Option Growth Plan may determine.
The maximum number of shares of Common Stock with respect to which awards
may be made under the Stock Option Growth Plan is 50,000 shares, subject to
adjustment as described below. See "Effect of Merger and Other Adjustments."
Shares of Common Stock subject to an award under the Stock Option Growth Plan
may be either authorized but unissued shares or reacquired shares held by the
Company in its treasury. Any shares subject to an award which expires or is
terminated unexercised will again be available for issuance under the Stock
Option Growth Plan.
Administration
The Stock Option Growth Plan is administered by a committee (the
"Committee") of two or more members, each of whom must be a "Non-Employee
Director" (as defined in the Stock Option Growth Plan). The Committee generally
has sole and complete authority and discretion to: (i) select participants and
grant awards; (ii) determine the number of shares to be subject to types of
awards generally, as well as to individual awards granted under the Stock Option
Growth Plan; (iii) determine the terms and conditions upon which awards shall be
granted under the Stock Option Growth Plan; (iv) prescribe the form and terms of
instruments evidencing such grants; and (v) establish from time to time
regulations for the administration of the Stock Option Growth Plan, interpret
the Stock Option Growth Plan, and make all determinations deemed necessary or
advisable for the administration of the Stock Option Growth Plan.
Eligibility
Any director, advisory director, director emeritus, officer or employee of
the Company or any corporate affiliate thereof is eligible to participate in the
Stock Option Growth Plan, which currently includes approximately 75 persons.
Participants will be selected by the Committee based on their capacity for
contributing to the successful performance of the Company or its corporate
affiliates.
8
Award Descriptions
The Stock Option Growth Plan authorizes the Committee to grant the
following awards:
Stock Options. The Committee may grant either "Incentive Stock Options" as
defined under Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code") or stock options not intended to qualify as such ("NonQualified Stock
Options"). Incentive Stock Options may be granted only to employees of the
Company and its corporate affiliates.
The term of a stock option granted under the Stock Option Growth Plan may
not exceed 10 years from the date of grant. The term of an Incentive Stock
Option granted to any individual owning stock possessing more than ten percent
of the total combined voting power of all classes of stock of the Company and
its corporate affiliates may not exceed five years from the date of grant.
The exercise price and the manner, time and rate of exercise of each stock
option are determined by the Committee, provided that the exercise price may not
be less than 110% of the market value per share of the Common Stock on the date
of grant of the option. The exercise price may be paid in cash, shares of Common
Stock or a combination of both.
Stock Appreciation Rights. The Committee is authorized to award SARs, each
of which, upon exercise thereof, will entitle the holder thereof to receive a
number of shares of Common Stock or cash or a combination thereof, as the
Committee shall determine, the aggregate value of which shall equal (as nearly
as possible) the amount by which the market value per share of the Common Stock
on the date of exercise exceeds the exercise price of the SAR, multiplied by the
number of shares of Common Stock underlying the SAR. A SAR may be related to an
option or granted independently of an option.
The term of a SAR may not exceed ten years from the date of grant. The
Committee will determine the exercise price and the manner, time and rate of
exercise of each SAR, provided that (i) the exercise price may not be less than
110% of the market value per share of the Common Stock on the date of grant and
(ii) an option related to a SAR which is an Incentive Stock Option must satisfy
all requirements pertaining to Incentive Stock Options. SARs are generally
exercisable to the same extent and in the same manner as stock options, as
described above.
Limited SARs. At the time of grant of an option or SAR to any participant,
the Committee may also grant to such participant a Limited SAR which is related
to such option or SAR. A Limited SAR will be exercisable only during the period
beginning on the first day following and ending on the forty-fifth day following
the expiration date of any tender or exchange offer for shares of the Common
Stock, other than by the Company, whereby 25% or more of the outstanding shares
are acquired in that offer or any other offer which expires within 60 days of
that offer. The amount paid upon exercise of a Limited SAR will be the excess of
either (a) the market value per share of the Common Stock on the date of
exercise, or (b) the highest price per share paid pursuant to the offer, as
provided by the Committee in its discretion at the time of grant, over the
exercise price of the Limited SAR. Payment upon exercise of a Limited SAR will
be in cash. Upon exercise of a Limited SAR, any related option or SAR will cease
to be exercisable to the extent of the shares with respect to which the Limited
SAR was exercised.
As with stock options and SARs, the exercise price of a Limited SAR may not
be less than 110% of the market value per share of the Common Stock on the date
of grant and the term of a Limited SAR may not exceed ten years from the date of
grant. An option related to a Limited SAR which is an Incentive Stock Option
must satisfy all requirements pertaining to Incentive Stock Options.
Termination of Service
Unless the Committee provides otherwise in the applicable instrument
evidencing the grant, in the event of the cessation of a participant's
"continuous service" (as defined in the Stock Option Growth Plan) to the Company
or an affiliate thereof at a time when the participant is eligible for
"retirement" (as defined in the Company's Employee Stock Ownership Plan"), the
participant may exercise an option or Right theretofore granted to such
participant within a period of two years from the date of cessation of
continuous service to the extent the option or Right was exercisable by the
participant at the date of such cessation (but in no event after the expiration
date of the award). In the event of the cessation of a participant's continuous
service due to death or disability, then unless the Committee provides otherwise
in the applicable instrument evidencing the grant, all Rights and options
theretofore granted to the participant and not
9
fully exercisable shall become exercisable in full upon the occurrence of such
event and shall remain so exercisable for a period of two years following such
date (but in the case of the participant's death, in no event later than ten
years from the date of grant of such option or Right). If the continuous service
of a participant is terminated for any reason other than death, disability or
after becoming eligible for retirement, all rights under any option or Right
held by such participant will expire immediately upon the effective date of such
termination.
In the event of the death of a participant while in continuous service with
the Company or any corporate affiliate thereof, or within the two year period
following cessation of continuous service due to disability or while the
participant is eligible for retirement, an exercisable option or Right
theretofore awarded to the participant will continue to be exercisable for two
years, to the extent exercisable by the participant immediately prior to his
death, but in no event later than ten years after grant. Following the death of
any participant, the Committee may, as an alternative means of settlement of an
option, elect to pay to the person to whom the option has been transferred an
amount of cash equal to the amount by which the market value of the shares
covered by the option on the date of exercise exceeds the aggregate exercise
price.
Transferability of Awards
An Incentive Stock Option awarded under the Stock Option Growth Plan may be
transferred only upon the death of the participant to whom it has been granted,
by will or by the laws of inheritance. An award other than an Incentive Stock
Option may be transferred upon the death of the participant by will or the laws
of inheritance or during the lifetime of the participant to whom it was awarded
pursuant to a qualified domestic relations order.
Effect of Merger and Other Adjustments
Shares as to which awards may be granted under the Stock Option Growth
Plan, and shares then subject to awards, will be adjusted by the Committee in
the event of any merger, consolidation, reorganization, recapitalization, stock
dividend, stock split or other change in the corporate structure of the Company.
In the case of any merger, consolidation or combination of the Company with
or into another company or other entity, whereby either the Company is not the
continuing entity or its outstanding shares are converted into or exchanged for
different securities, cash or property, or any combination thereof, pursuant to
a plan or agreement the terms of which are binding upon all stockholders of the
Company (except to the extent that dissenting stockholders may be entitled to
receive the appraised or fair value of their holdings under applicable law), any
participant to whom a stock option or Right has been granted will have the right
(subject to other provisions of the Stock Option Growth Plan) upon exercise of
the option or Right to an amount equal to the excess of the fair market value on
the date of exercise of the consideration receivable in the merger,
consolidation or combination in respect of the shares covered or represented by
the stock option or Right over the exercise price of the option or Right
multiplied by the number of shares with respect to which the option or Right has
been exercised. Such amount may be payable in (i) cash, (ii) in the
consideration receivable in the merger, consolidation or combination or (iii) in
a combination thereof, all in the discretion of the Committee.
In addition, in the event of a tender or exchange offer for shares of
Common Stock (other than an offer made by the Company or an affiliate thereof)
or if stockholders of the Company approve a transaction pursuant to which the
Company will cease to be an independent publicly-owned entity or pursuant to
which substantially all of its assets will be sold, unless the Committee shall
have otherwise provided in the applicable award agreement, all outstanding stock
options and SARs not fully exercisable will become exercisable in full and
remain so for a period of 60 days, after which they will revert to being
exercisable in accordance with their terms. However, no stock option or SAR
previously exercised or terminated shall be exercisable.
Amendment and Termination
The Board of Directors of the Company may at any time amend, suspend or
terminate the Stock Option Growth Plan or any portion thereof but may not
(except for adjustments upon certain changes in the capitalization of the
Company), without the prior approval of the Company's stockholders, make any
amendment which would (i) increase the aggregate number of shares of Common
Stock which may be awarded under the Stock Option Growth Plan, (ii) materially
increase the benefits accruing to participants; (iii) materially change the
requirements as to eligibility for participation in the Stock Option Growth
Plan; or (iv) change the class of persons eligible to participate in the Stock
10
Option Growth Plan. Unless sooner terminated, the Stock Option Growth Plan shall
continue in effect for a term of ten years, commencing upon its ratification by
the Company's stockholders.
Federal Income Tax Consequences
Under present federal income tax laws, awards under the Stock Option Growth
Plan will have the following consequences:
(1) The grant of an award will neither, by itself, result in the
recognition of taxable income to the participant nor entitle the Company to a
deduction at the time of such grant.
(2) The exercise of a stock option which is an Incentive Stock Option will
generally not, by itself, result in the recognition of taxable income to the
participant nor entitle the Company to a deduction at the time of such exercise.
However, the difference between the exercise price and the fair market value of
the option shares on the date of exercise is an item of tax preference which
may, in certain situations, trigger the alternative minimum tax. The alternative
minimum tax applies only when it exceeds the regular income tax. If the shares
acquired upon exercise of an Incentive Stock Option are not held for at least
one year after transfer of such shares to the participant or two years after the
grant of the Incentive Stock Option, whichever is later, the participant will
recognize ordinary income or loss upon disposition of the shares in an amount
equal to the difference between the exercise price and the fair market value of
the shares on the date of exercise of the option. Upon such an event, the
Company will be entitled to a corresponding deduction in the amount of ordinary
income, if any, recognized by the participant, provided the Company meets its
federal tax withholding obligations. The participant will also recognize a
capital gain or loss in an amount equal to the difference, if any, between the
sale price and the fair market value of the shares on the date of exercise of
the Incentive Stock Option; such capital gain or loss will be characterized as
long-term if the shares were held for more than one year after the date of
exercise. The Company will not be entitled to a corresponding deduction for such
capital gain or loss. If the shares are held by the participant for one year
after the Incentive Stock Option is exercised and two years after the Incentive
Stock Option was granted, the participant will recognize a capital gain or loss
upon disposition of the shares in an amount equal to the difference between the
sale price and the exercise price. The Company will not be entitled to a
corresponding deduction for such capital gain or loss. Long term capital gains
for shares held between one year and 18 months are currently taxed at a maximum
rate of 28%. Shares held for longer than 18 months are currently taxed at a
maximum rate of 20%.
(3) The exercise of a Non-Qualified Stock Option will result in the
recognition of ordinary income by the participant on the date of exercise in an
amount equal to the difference between the exercise price and the fair market
value on the date of exercise of the shares acquired pursuant to the
Non-Qualified Stock Option. The Company will be allowed a deduction in the
amount of any ordinary income recognized by the participant upon exercise of a
NonQualified Stock Option, provided the Company meets its federal tax
withholding obligations. Upon sale of the shares acquired upon exercise of a
Non-Qualified Stock Option, any appreciation or depreciation in value of such
shares from the time of exercise will result in the recognition of a capital
gain or loss by the participant. The Company will not be entitled to a
corresponding deduction for such capital gain or loss. Such capital gain or loss
will be long-term capital gain or loss if the participant held the shares for
more than one year following exercise of the Non-Qualified Stock Option.
(4) The exercise of a Right will result in the recognition of ordinary
income by the participant on the date of exercise in an amount of cash, and/or
the fair market value on that date of the shares, acquired pursuant to the
exercise. Upon such an event, the Company will be entitled to a corresponding
deduction in the amount of ordinary income, if any, recognized by the
participant, provided the Company meets its federal tax withholding obligations.
Awards Under the Stock Option Growth Plan
No awards have been made under the Stock Option Growth Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" APPROVAL OF
THE STOCK OPTION GROWTH PLAN.
11
PROPOSAL III - RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has appointed Smith, Goolsby, Artis &
Reams, P.S.C., independent accountants, to be the Company's auditors for the
fiscal year ending March 31, 1999. Representatives of Smith, Goolsby, Artis &
Reams, P.S.C. are expected to attend the Meeting to respond to appropriate
questions and to make a statement if they so desire.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF SMITH, GOOLSBY, ARTIS & REAMS, P.S.C. AS THE
COMPANY'S AUDITORS FOR THE FISCAL YEAR ENDING MARCH 31, 1999.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials for
the next annual meeting of stockholders, any stockholder proposal to take action
at such meeting must be received at the Company's office located at 344
Seventeenth Street, Ashland, Kentucky 41101, no later than February 26, 1999.
Any such proposal shall be subject to the requirements of the proxy rules
adopted under the Exchange Act.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitation by mail,
directors, officers and regular employees of the Company, Classic Bank or
Paintsville Bank may solicit proxies personally or by telegraph or telephone
without additional compensation. The Company has retained Regan & Associates to
assist in the solicitation of proxies for a fee of $2,750, plus reasonable
out-of-pocket expenses not to exceed $1,250.
Ashland, Kentucky
June 26, 1998
12
APPENDIX A
CLASSIC BANCSHARES, INC.
1998 PREMIUM PRICE STOCK OPTION GROWTH PLAN
1. Plan Purpose. The purpose of the Plan is to promote the long-term
interests of the Corporation and its stockholders by providing a means for
attracting and retaining directors, advisory directors, directors emeriti,
officers and employees of the Corporation and its Affiliates. It is intended
that designated Options granted pursuant to the provisions of this Plan to
persons employed by the Corporation or its Affiliates will qualify as Incentive
Stock Options. Options granted to persons who are not employees will be
Non-Qualified Stock Options.
2. Definitions. The following definitions are applicable to the Plan:
"Affiliate" - means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in Section 424(e) and (f),
respectively, of the Code.
"Award" - means the grant of an Incentive Stock Option, a Non-Qualified
Stock Option, a Stock Appreciation Right, a Limited Stock Appreciation Right or
any combination thereof, as provided in the Plan.
"Code" - means the Internal Revenue Code of 1986, as amended.
"Committee" - means the Committee referred to in Section 3 hereof.
"Continuous Service" - means the absence of any interruption or termination
of service as a director, advisory director, director emeritus, officer or
employee of the Corporation or an Affiliate, except that when used with respect
to any Options or Rights which at the time of exercise are intended to be
Incentive Stock Options, Continuous Service means the absence of any
interruption or termination of service as an employee of the Corporation or an
Affiliate. Service shall not be considered interrupted in the case of sick
leave, military leave or any other leave of absence approved by the Corporation
or in the case of transfers between payroll locations of the Corporation or
between the Corporation, its parent, its subsidiaries or its successor. With
respect to any advisory director or director emeritus, Continuous Service shall
mean availability to perform such functions as may be required of such persons.
"Corporation" - means Classic Bancshares, Inc., a Delaware corporation.
"Employee" - means any person, including an officer or director, who is
employed by the Corporation or any Affiliate.
"ERISA" - means the Employee Retirement Income Security Act of 1974, as
amended.
"Exercise Price" - means (i) in the case of an Option, the price per Share
at which the Shares subject to such Option may be purchased upon exercise of
such Option and (ii) in the case of a
Right, the price per Share (other than the Market Value per Share on the date of
exercise and the Offer Price per Share as defined in Section 10 hereof) which,
upon grant, the Committee determines shall be utilized in calculating the
aggregate value which a Participant shall be entitled to receive pursuant to
Sections 9, 10 or 12 hereof upon exercise of such Right. In all cases, the
Exercise Price of an Option or Right shall equal at least 110% of the Market
Value of the Shares subject to such Option or Right on the date of grant
thereof.
"Incentive Stock Option" - means an option to purchase Shares granted by
the Committee pursuant to Section 6 hereof which is subject to the limitations
and restrictions of Section 8 hereof and is intended to qualify under Section
422(b) of the Code.
"Limited Stock Appreciation Right" - means a stock appreciation right with
respect to Shares granted by the Committee pursuant to Sections 6 and 10 hereof.
"Market Value" - means the average of the high and low quoted sales price
on the date in question (or, if there is no reported sale on such date, on the
last preceding date on which any reported sale occurred) of a Share on the
Composite Tape for the New York Stock Exchange-Listed Stocks, or, if on such
date the Shares are not quoted on the Composite Tape, on the New York Stock
Exchange, or, if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934 on which the Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted to trading on any such
exchange, the mean between the closing high bid and low asked quotations with
respect to a Share on such date on the NASDAQ System, or any similar system then
in use, or, if no such quotations are available, the fair market value on such
date of a Share as the Committee shall determine.
"Non-Employee Director" - means a director who a) is not currently an
officer or employee of the Corporation; b) is not a former employee of the
Corporation who receives compensation for prior services (other than from a
tax-qualified retirement plan); c) has not been an officer of the Corporation;
d) does not receive remuneration from the Corporation in any capacity other than
as a director, except "De Minimis Remuneration" as defined in the rules
promulgated pursuant to Section 162(m) of the Code; and e) does not possess an
interest in any other transactions or is not engaged in a business relationship
for which disclosure would be required under Item 404(a) or (b) of Regulation
S-K.
"Non-Qualified Stock Option" - means an option to purchase Shares granted
by the Committee pursuant to Section 6 hereof which is not intended to qualify
under Section 422(b) of the Code.
"Option" - means an Incentive Stock Option or a Non-Qualified Stock Option.
"Participant" - means any director, advisory director, director emeritus,
officer or employee of the Corporation or any Affiliate who is selected by the
Committee to receive an Award.
"Plan" - means the 1998 Premium Price Stock Option Growth Plan of the
Corporation.
A-2
"Related" - means (i) in the case of a Right, a Right which is granted in
connection with, and to the extent exercisable, in whole or in part, in lieu of,
an Option or another Right and (ii) in the case of an Option, an Option with
respect to which and to the extent a Right is exercisable, in whole or in part,
in lieu thereof has been granted.
"Right" - means a Limited Stock Appreciation Right or a Stock Appreciation
Right.
"Shares" - means the shares of common stock of the Corporation.
"Stock Appreciation Right" - means a stock appreciation right with respect
to Shares granted by the Committee pursuant to Sections 6 and 9 hereof.
3. Administration. The Plan shall be administered by a Committee consisting
of two or more members, each of whom shall be a Non-Employee Director. The
members of the Committee shall be appointed by the Board of Directors of the
Corporation. Except as limited by the express provisions of the Plan, the
Committee shall have sole and complete authority and discretion, to (i) select
Participants and grant Awards; (ii) determine the number of Shares to be subject
to types of Awards generally, as well as to individual Awards granted under the
Plan; (iii) determine the terms and conditions upon which Awards shall be
granted under the Plan; (iv) prescribe the form and terms of instruments
evidencing such grants; and (v) establish from time to time regulations for the
administration of the Plan, interpret the Plan, and make all determinations
deemed necessary or advisable for the administration of the Plan.
A majority of the Committee shall constitute a quorum, and the acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by a majority of the Committee without a meeting, shall
be acts of the Committee.
4. Participation in Committee Awards. The Committee may select from time to
time Participants in the Plan from those directors (including advisory directors
and directors emeriti), officers and employees, of the Corporation or its
Affiliates who, in the opinion of the Committee, have the capacity for
contributing to the successful performance of the Corporation or its Affiliates.
5. Shares Subject to Plan. Subject to adjustment by the operation of
Section 11 hereof, the maximum number of Shares with respect to which Awards may
be made under the Plan is 50,000 Shares. The Shares with respect to which Awards
may be made under the Plan may be either authorized and unissued shares or
issued shares heretofore or hereafter reacquired and held as treasury shares.
Shares which are subject to Related Rights and Related Options shall be counted
only once in determining whether the maximum number of Shares with respect to
which Awards may be granted under the Plan has been exceeded. An Award shall not
be considered to have been made under the Plan with respect to any Option or
Right which terminates, and new Awards may be granted under the Plan with
respect to the number of Shares as to which such termination has occurred.
A-3
6. General Terms and Conditions of Options and Rights. The Committee shall
have full and complete authority and discretion, except as expressly limited by
the Plan, to grant Options and/or Rights and to provide the terms and conditions
(which need not be identical among Participants) thereof. In particular, the
Committee shall prescribe the following terms and conditions: (i) the Exercise
Price of any Option or Right, which shall not be less than 110% of the Market
Value per Share at the date of grant of such Option or Right, (ii) the number of
Shares subject to, and the expiration date of, any Option or Right, which
expiration date shall not exceed ten years from the date of grant, (iii) the
manner, time and rate (cumulative or otherwise) of exercise of such Option or
Right, and (iv) the restrictions, if any, to be placed upon such Option or Right
or upon Shares which may be issued upon exercise of such Option or Right. The
Committee may, as a condition of granting any Option or Right, require that a
Participant agree not to thereafter exercise one or more Options or Rights
previously granted to such Participant.
Furthermore, at the time of any Award, the Participant shall enter into an
agreement with the Corporation in a form specified by the Committee, agreeing to
the terms and conditions of the Award and such other matters as the Committee,
in its sole discretion, shall determine (the "Option Agreement").
7. Exercise of Options or Rights.
(a) Except as provided herein, an Option or Right granted under the Plan shall
be exercisable during the lifetime of the Participant to whom such Option
or Right was granted only by such Participant and, except as provided in
paragraphs (c) and (d) of this Section 7, no such Option or Right may be
exercised unless at the time such Participant exercises such Option or
Right, such Participant has maintained Continuous Service since the date of
grant of such Option or Right. In no event shall an Option or Right granted
under the Plan be exercisable after its expiration date.
(b) To exercise an Option or Right under the Plan, the Participant to whom such
Option or Right was granted shall give written notice to the Corporation in
form satisfactory to the Committee (and, if partial exercises have been
permitted by the Committee, by specifying the number of Shares with respect
to which such Participant elects to exercise such Option or Right) together
with full payment of the Exercise Price, if any and to the extent required.
The date of exercise shall be the date on which such notice is received by
the Corporation. Payment, if any is required, shall be made either (i) in
cash (including check, bank draft or money order) or (ii) by delivering (A)
Shares already owned by the Participant and having a fair market value
equal to the applicable exercise price, such fair market value to be
determined in such appropriate manner as may be provided by the Committee
or as may be required in order to comply with or to conform to requirements
of any applicable laws or regulations, or (B) a combination of cash and
such Shares.
(c) If a Participant to whom an Option or Right was granted shall cease to
maintain Continuous Service as a result of termination of employment at a
time when the Participant is eligible for Aretirement,@ as defined in the
Corporation=s employee stock ownership plan, such Participant may, but only
within the period of two years immediately succeeding such cessation of
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Continuous Service and in no event after the expiration date of such Option
or Right, exercise such Option or Right to the extent that such Participant
was entitled to exercise such Option or Right at the date of such
cessation; provided, however, that such right of exercise after cessation
of Continuous Service shall not be available to a Participant if the
Committee otherwise determines and so provides in the applicable instrument
or instruments evidencing the grant of such Option or Right. If a
Participant to whom an Option or Right was granted shall cease to maintain
Continuous Service by reason of death or disability then, unless the
Committee shall have otherwise provided in the instrument evidencing the
grant of an Option or Right, all Options and Rights granted and not fully
exercisable shall become exercisable in full upon the happening of such
event and shall remain so exercisable (i) in the event of death for the
period described in paragraph (d) of this Section 7 and (ii) in the event
of disability for a period of two years following such date. If the
Continuous Service of a Participant to whom an Option or Right was granted
by the Corporation is terminated for any reason other than death or after
becoming eligible for Aretirement,@ as defined above, all rights under any
Option or Right of such Participant shall expire immediately upon the
effective date of such termination.
(d) In the event of the death of a Participant while in the Continuous Service
of the Corporation or an Affiliate or within the two-year period referred
to in paragraph (c) of this Section 7, the person to whom any Option or
Right held by the Participant at the time of his death is transferred by
will or the laws of descent and distribution, or in the case of an Award
other than an Incentive Stock Option, pursuant to a qualified domestic
relations order, as defined in the Code or Title I of ERISA or the rules
thereunder, may, but only to the extent such Participant was entitled to
exercise such Option or Right upon his death as provided in paragraph (c)
above, exercise such Option or Right at any time within a period of two
years succeeding the date of death of such Participant, but in no event
later than ten years from the date of grant of such Option or Right.
Following the death of any Participant to whom an Option was granted under
the Plan, irrespective of whether any Related Right shall have theretofore
been granted to the Participant or whether the person entitled to exercise
such Related Right desires to do so, the Committee may, as an alternative
means of settlement of such Option, elect to pay to the person to whom such
Option is transferred by will or by the laws of descent and distribution,
or in the case of an Option other than an Incentive Stock Option, pursuant
to a qualified domestic relations order, as defined in the Code or Title I
of ERISA or the rules thereunder, the amount by which the Market Value per
Share on the date of exercise of such Option shall exceed the Exercise
Price of such Option, multiplied by the number of Shares with respect to
which such Option is properly exercised. Any such settlement of an Option
shall be considered an exercise of such Option for all purposes of the
Plan.
(e) Notwithstanding the provisions of subparagraphs (c) and (d) above, the
Committee may, in its sole discretion, establish different terms and
conditions pertaining to the effect of termination to the extent permitted
by applicable federal and state law.
8. Incentive Stock Options. Incentive Stock Options may be granted only to
Participants who are Employees. Any provision of the Plan to the contrary
notwithstanding, (i) no Incentive Stock
A-5
Option shall be granted more than ten years from the date the Plan is adopted by
the Board of Directors of the Corporation and no Incentive Stock Option shall be
exercisable more than ten years from the date such Incentive Stock Option is
granted, (ii) the Exercise Price of any Incentive Stock Option shall not be less
than 110% of the Market Value per Share on the date such Incentive Stock Option
is granted, (iii) any Incentive Stock Option shall not be transferable by the
Participant to whom such Incentive Stock Option is granted other than by will or
the laws of descent and distribution, and shall be exercisable during such
Participant's lifetime only by such Participant, (iv) no Incentive Stock Option
shall be granted to any individual who, at the time such Incentive Stock Option
is granted, owns stock possessing more than ten percent of the total combined
voting power of all classes of stock of the Corporation or any Affiliate unless
the Exercise Price of such Incentive Stock Option is at least 110% of the Market
Value per Share at the date of grant and such Incentive Stock Option is not
exercisable after the expiration of five years from the date such Incentive
Stock Option is granted, and (v) the aggregate Market Value (determined as of
the time any Incentive Stock Option is granted) of the Shares with respect to
which Incentive Stock Options are exercisable for the first time by a
Participant in any calendar year shall not exceed $100,000.
9. Stock Appreciation Rights. A Stock Appreciation Right shall, upon its
exercise, entitle the Participant to whom such Stock Appreciation Right was
granted to receive a number of Shares or cash or combination thereof, as the
Committee in its discretion shall determine, the aggregate value of which (i.e.,
the sum of the amount of cash and/or Market Value of such Shares on date of
exercise) shall equal (as nearly as possible, it being understood that the
Corporation shall not issue any fractional shares) the amount by which the
Market Value per Share on the date of such exercise shall exceed the Exercise
Price of such Stock Appreciation Right, multiplied by the number of Shares with
respect of which such Stock Appreciation Right shall have been exercised. A
Stock Appreciation Right may be Related to an Option or may be granted
independently of any Option as the Committee shall from time to time in each
case determine. At the time of grant of an Option the Committee shall determine
whether and to what extent a Related Stock Appreciation Right shall be granted
with respect thereto, provided, however, and notwithstanding any other provision
of the Plan, that if the Related Option is an Incentive Stock Option, the
Related Stock Appreciation Right shall satisfy all the restrictions and
limitations of Section 8 hereof as if such Related Stock Appreciation Right were
an Incentive Stock Option and as if other rights which are Related to Incentive
Stock Options were Incentive Stock Options. In the case of a Related Option,
such Related Option shall cease to be exercisable to the extent of the Shares
with respect to which the Related Stock Appreciation Right was exercised. Upon
the exercise or termination of a Related Option, any Related Stock Appreciation
Right shall terminate to the extent of the Shares with respect to which the
Related Option was exercised or terminated.
10. Limited Stock Appreciation Rights. At the time of grant of an Option or
Stock Appreciation Right to any Participant, the Committee shall have full and
complete authority and discretion to also grant to such Participant a Limited
Stock Appreciation Right which is Related to such Option or Stock Appreciation
Right, provided, however and notwithstanding any other provision of the Plan,
that if the Related Option is an Incentive Stock Option, the Related Limited
Stock Appreciation Right shall satisfy all the restrictions and limitations of
Section 8 hereof as if such Related Limited Stock Appreciation Right were an
Incentive Stock Option and as if all other
A-6
Rights which are Related to Incentive Stock Options were Incentive Stock
Options. A Limited Stock Appreciation Right shall be exercisable only during the
period beginning on the first day following the date of expiration of any
"offer" (as such term is hereinafter defined) and ending on the forty-fifth day
following such date.
A Limited Stock Appreciation Right shall, upon its exercise, entitle the
Participant to whom such Limited Stock Appreciation Right was granted to receive
an amount of cash equal to the amount by which the "Offer Price per Share" (as
such term is hereinafter defined) or the Market Value on the date of such
exercise, as shall have been provided by the Committee in its discretion at the
time of grant, shall exceed the Exercise Price of such Limited Stock
Appreciation Right, multiplied by the number of Shares with respect to which
such Limited Stock Appreciation Right shall have been exercised. Upon the
exercise of a Limited Stock Appreciation Right, any Related Option and/or
Related Stock Appreciation Right shall cease to be exercisable to the extent of
the Shares with respect to which such Limited Stock Appreciation Right was
exercised. Upon the exercise or termination of a Related Option or Related Stock
Appreciation Right, any Related Limited Stock Appreciation Right shall terminate
to the extent of the Shares with respect to which such Related Option or Related
Stock Appreciation Right was exercised or terminated.
For the purposes of this Section 10, the term "Offer" shall mean any tender
offer or exchange offer for Shares other than one made by the Corporation,
provided that the corporation, person or other entity making the offer acquires
pursuant to such offer either (i) 25% of the Shares outstanding immediately
prior to the commencement of such offer or (ii) a number of Shares which,
together with all other Shares acquired in any tender offer or exchange offer
(other than one made by the Corporation) which expired within sixty days of the
expiration date of the offer in question, equals 25% of the Shares outstanding
immediately prior to the commencement of the offer in question. The term "Offer
Price per Share" as used in this Section 10 shall mean the highest price per
Share paid in any Offer which Offer is in effect any time during the period
beginning on the sixtieth day prior to the date on which a Limited Stock
Appreciation Right is exercised and ending on the date on which such Limited
Stock Appreciation Right is exercised. Any securities or property which are part
or all of the consideration paid for Shares in the Offer shall be valued in
determining the Offer Price per Share at the higher of (A) the valuation placed
on such securities or property by the corporation, person or other entity making
such Offer or (B) the valuation placed on such securities or property by the
Committee.
11. Adjustments Upon Changes in Capitalization. In the event of any change
in the outstanding Shares subsequent to the effective date of the Plan by reason
of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in the
corporate structure or Shares of the Corporation, the maximum aggregate number
and class of shares as to which Awards may be granted under the Plan and the
number, class and exercise price of shares with respect to which Awards
theretofore have been granted under the Plan shall be appropriately adjusted by
the Committee, whose determination shall be conclusive.
12. Effect of Merger. In the event of any merger, consolidation or
combination of the Corporation (other than a merger, consolidation or
combination in which the Corporation is the
A-7
continuing entity and which does not result in the outstanding Shares being
converted into or exchanged for different securities, cash or other property, or
any combination thereof) pursuant to a plan or agreement the terms of which are
binding upon all stockholders of the Corporation (except to the extent that
dissenting stockholders may be entitled, under statutory provisions or
provisions contained in the certificate or articles of incorporation, to receive
the appraised or fair value of their holdings), any Participant to whom an
Option or Right has been granted shall have the right (subject to the provisions
of the Plan and any limitation or vesting period applicable to such Option or
Right), thereafter and during the term of each such Option or Right, to receive
upon exercise of any such Option or Right an amount equal to the excess of the
fair market value on the date of such exercise of the securities, cash or other
property, or combination thereof, receivable upon such merger, consolidation or
combination in respect of a Share over the Exercise Price of such Right or
Option, multiplied by the number of Shares with respect to which such Option or
Right shall have been exercised. Such amount may be payable fully in cash, fully
in one or more of the kind or kinds of property payable in such merger,
consolidation or combination, or partly in cash and partly in one or more of
such kind or kinds of property, all in the discretion of the Committee.
13. Effect of Change in Control. If a tender offer or exchange offer for
Shares (other than such an offer by the Corporation or an Affiliate) is
commenced, or if the stockholders of the Corporation shall approve an agreement
providing either for a transaction in which the Corporation will cease to be an
independent publicly owned entity or for a sale or other disposition of all or
substantially all the assets of the Corporation or an Affiliate, unless the
Committee shall have otherwise provided in the instrument evidencing the grant
of an Option or Stock Appreciation Right, all Options and Stock Appreciation
Rights granted and not fully exercisable shall become exercisable in full upon
the happening of such event and shall remain so exercisable for a period of
sixty days following such date, after which they shall revert to being
exercisable in accordance with their terms; provided, however, that no Option or
Stock Appreciation Right which has previously been exercised or otherwise
terminated shall become exercisable; provided further, that the acceleration of
exercisability of an Award under this Section 13 shall not be applicable if it
is intended that the transaction constituting such Change in Control be
accounted for as a pooling of interests under Accounting Principles Board
Opinion No. 16 (or any successor thereto), and operation of this Section 13
would otherwise violate Paragraph 47(c) thereof.
14. Assignments and Transfers. No Award nor any right or interest of a
Participant under the Plan in any instrument evidencing any Award under the Plan
may be assigned, encumbered or transferred except, in the event of the death of
a Participant, by will or the laws of descent and distribution or in the case of
Awards other than Incentive Stock Options pursuant to a qualified domestic
relations order, as defined in the Code or Title I of ERISA or the rules
thereunder.
15. Employee Rights Under the Plan. No director, officer or employee shall
have a right to be selected as a Participant nor, having been so selected, to be
selected again as a Participant and no director, officer, employee or other
person shall have any claim or right to be granted an Award under the Plan or
under any other incentive or similar plan of the Corporation or any Affiliate.
Neither the Plan nor any action taken thereunder shall be construed as giving
any employee any right to be retained in the employ of the Corporation or any
Affiliate.
A-8
16. Delivery and Registration of Stock. The Corporation's obligation to
deliver Shares with respect to an Award shall, if the Committee so requests, be
conditioned upon the receipt of a representation as to the investment intention
of the Participant to whom such Shares are to be delivered, in such form as the
Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933 or any other Federal, state or local
securities legislation or regulation. It may be provided that any representation
requirement shall become inoperative upon a registration of the Shares or other
action eliminating the necessity of such representation under such Securities
Act or other securities legislation. The Corporation shall not be required to
deliver any Shares under the Plan prior to (i) the admission of such shares to
listing on any stock exchange or other system on which Shares may then be
listed, and (ii) the completion of such registration or other qualification of
such Shares under any state or Federal law, rule or regulation, as the Committee
shall determine to be necessary or advisable.
17. Withholding Tax. The Corporation shall have the right to deduct from
all amounts paid in cash with respect to the exercise of a Right under the Plan
any taxes required by law to be withheld with respect to such cash payments.
Where a Participant or other person is entitled to receive Shares pursuant to
the exercise of an Option or Right pursuant to the Plan, the Corporation shall
have the right to require the Participant or such other person to pay the
Corporation the amount of any taxes which the Corporation is required to
withhold with respect to such Shares, and may, in its sole discretion, withhold
sufficient Shares to cover the amount of taxes which the Corporation is required
to withhold.
18. Amendment or Termination. The Board of Directors of the Corporation may
amend, suspend or terminate the Plan or any portion thereof at any time, but
(except as provided in Section 11 hereof) no amendment shall be made without
approval of the stockholders of the Corporation which shall (i) increase the
aggregate number of Shares with respect to which Awards may be made under the
Plan, (ii) materially increase the benefits accruing to Participants, (iii)
materially change the requirements as to eligibility for participation in the
Plan or (iv) change the class of persons eligible to participate in the Plan;
provided, however, that no such amendment, suspension or termination shall
impair the rights of any Participant, without his consent, in any Award
theretofore made pursuant to the Plan.
19. Effective Date and Term of Plan. The Plan shall become effective upon
its ratification by stockholders of the Corporation. It shall continue in effect
for a term of ten years unless sooner terminated under Section 18 hereof.
A-9
REVOCABLE PROXY REVOCABLE PROXY
CLASSIC BANCSHARES, INC.
ANNUAL MEETING OF STOCKHOLDER
July 27, 1998
The undersigned hereby appoints the Board of Directors of Classic
Bancshares, Inc. (the "Company"), with full powers of substitution, to act as
attorneys and proxies for the undersigned to vote all shares of capital stock of
the Company which the undersigned is entitled to vote at the Company's Annual
Meeting of Stockholders (the "Meeting") to be held at the corporate
headquarters of RAM Technologies, Inc., located at 1516 Bath Avenue, Ashland,
Kentucky, on July 27, 1998 at 3:00 p.m. Ashland, Kentucky time, and at any and
all adjournments and postponements thereof.
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote "FOR" the election of all nominees
listed in Item I below and "FOR" the proposals listed in Items II and III below.
I - The election as directors of all
nominees listed below (except as marked
to the contrary) FOR - |_| VOTE WITHHELD - |_|
C. CYRUS REYNOLDS, DAVID B. BARBOUR AND
JEFFREY P. LOPEZ, M.D.
(To withhold authority to vote for any individual nominee
strike out that nominee's name)
II - The approval of the Classic Bancshares,
Inc. 1998 Premium Price Stock Option
Growth Plan FOR - |_| AGAINST - |_| ABSTAIN - |_|
III - The ratification of the appointment of
Smith, Goolsby, Artis & Reems, P.S.C. as
auditors for the Company for the fiscal
year ending March 31, 1998. FOR - |_| AGAINST - |_| ABSTAIN - |_|
In their discretion, the proxies are authorized to vote on any other
business that may properly come before the Meeting or any adjournment or
postponement thereof.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTION ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES AND THE PROPOSALS LISTED
ABOVE. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE
VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT AT THE PRESENT TIME,
THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
MEETING.
(Continued and to be SIGNED on Reverse Side)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
This Proxy may be revoked at any time before it is voted by (i) filing with the
Secretary of the Company at or before the Meeting a written notice of revocation
bearing a later date than this Proxy, (ii) duly executing a subsequent proxy
relating to the same shares and delivering it to the Secretary of the Company at
or before the Meeting, or (iii) attending the Meeting and voting in person
(although attendance at the meeting will not in and of itself constitute
revocation of this Proxy) if this Proxy is properly revoked as described above,
then the power of such attorneys and proxies shall be deemed terminated and of
no further force and effect.
The undersigned acknowledges receipt from the Company, prior
to the execution of this proxy, of Notice of the Meeting, a
Proxy Statement and an Annual Report to Stockholders for the
fiscal year ended March 31, 1998.
Dated ________________________________________________, 1998
____________________________________________________________
Signature of Stockholder
____________________________________________________________
Signature of Stockholder
Please sign exactly as yor name(s) appear(s) to the left.
When signing as attorney, executor, administrator, trustee
or guardian, please give your full title. If shares ae held
jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY
PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE