SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the registrant [ ]
Filed by a party other than the registrant [X]
Check the appropriate box:
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)
(2)).
[ ] Definitive proxy statement.
[ X ] Definitive additional materials.
[ ] Soliciting material under Rule 14a-12.
FIRST AVIATION SERVICES INC.
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(Name of Registrant as Specified in its Charter)
WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P.
WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. I
WYNNEFIELD SMALL CAP VALUE OFFSHORE FUND, LTD.
WYNNEFIELD CAPITAL MANAGEMENT, LLC
WYNNEFIELD CAPITAL, INC.
NELSON OBUS
JOSHUA H. LANDES
WYNNEFIELD CAPITAL, INC. PROFIT SHARING PLAN
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(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
PRESS RELEASE
CONTACT:
Eric Berman
Joseph Kuo
of Kekst and Company
212-521-4800
or:
Nelson Obus
of Wynnefield Capital
212-760-0134
ISS ENDORSES WYNNEFIELD NOMINEE AND CUMULATIVE VOTING
FOR FAVS SHAREHOLDERS
-- INDEPENDENT PROXY VOTING AND CORPORATE GOVERNANCE ADVISORY FIRM RECOMMENDS
VOTE FOR WYNNEFIELD'S GREEN PROXY CARD --
NEW YORK, NY, June 8, 2004 - THE WYNNEFIELD GROUP, THE LARGEST MINORITY
SHAREHOLDER IN FIRST AVIATION SERVICES INC. (NASDAQ: FAVS), ANNOUNCED TODAY THAT
INSTITUTIONAL SHAREHOLDER SERVICES INC. (ISS) - THE INFLUENTIAL INDEPENDENT
PROXY VOTING AND CORPORATE GOVERNANCE ADVISORY FIRM - RECOMMENDED THAT FAVS
SHAREHOLDERS VOTE FOR THE ELECTION OF NELSON OBUS, WYNNEFIELD'S NOMINEE, AS
DIRECTOR AND FOR THE IMPLEMENTATION OF CUMULATIVE VOTING FOR DIRECTORS.
"We are gratified that ISS - a leading independent proxy advisory firm -
recognized that FAvS' minority shareholders deserve a voice on the board," said
Nelson Obus, the Wynnefield Group nominee to the FAvS board. "ISS' conclusions
confirm our findings, as long-time shareholders of FAvS, that the company needs
a business plan to deliver profitability and shareholder value - and that
minority shareholders should be given a voice on the FAvS board.
"THIS ANALYSIS CONFIRMS THAT OVER THE PAST SIX YEARS FAVS HAS FAILED TO DEVELOP
A PROFITABLE BUSINESS STRATEGY, EXHIBITED UNSATISFACTORY FINANCIAL PERFORMANCE,
HAS MAJOR DEFICIENCIES IN ITS CORPORATE GOVERNANCE AND THAT ITS MANAGEMENT AND
INCUMBENT BOARD HAVE FAILED TO DELIVER SHAREHOLDER VALUE. FAVS CAN NO LONGER
HIDE THESE REAL ISSUES BEHIND PERSONAL ATTACKS ON ME," Mr. Obus concluded.
ISS CONCLUDED THAT MR. OBUS' ELECTION TO THE BAORD IS IN THE BEST INTEREST OF
SHAREHOLDER VALUE. ISS SAID: "WITH POOR HISTORICAL SHAREHOLDER RETURNS, A
CONTINUING CONFLICT OF INTEREST DUE TO RELATED PARTY TRANSACTIONS WITH FIRST
EQUITY GROUP, AND THE MARKET VALUING THE COMPANY NEAR ITS LIQUIDIATION VALUE,
THE CIRCUMSTANCES WARRANT SUPPORT OF THE DISSIDENT NOMINEE. WE BELIEVE THAT AN
ALTERNATIVE VOICE ON THE BOARD WOULD INCREASE THE ODDS OF MAXIMIZING SHAREHOLDER
VALUE."
ISS' analysis further stated that: "In meeting with Mr. Obus, we believe that
his requests are reasonable. Asking the board to commit to a business plan with
a targeted rate of return in order to benchmark the company's progress and
performance is reasonable. Further, the pursuit of strategic alternatives in a
transaction is a reasonable request if the company is not able to bolster its
performance operationally."
ISS ALSO FOUND THAT THE FEES FAVS PAYS TO THE INVESTMENT BANK FIRST EQUITY
(WHICH IS WHOLLY OWNED BY FAVS' CHAIRMAN AND ITS CEO) "REPRESENT A CONFLICT OF
INTEREST" AND THAT THEY ARE "MATERIAL" TO THE COMPANY'S FINANCIAL RESULTS.
Of Mr. Obus' qualifications for the board, ISS noted his background in
securities analysis and portfolio management, including his experience and
knowledge of the aviation industry. It also noted his service as a director on
two other public company boards and stated that, "THE SUBSTANTIAL SHARE
OWNERSHIP OF THE WYNNEFIELD GROUP ENHANCES THE CREDIBILITY OF ITS DIRECTOR
NOMINEE."
more...
ISS ENDORSES WYNNEFIELD NOMINEE, CUMULATIVE VOTING FOR FAVS SHAREHOLDERS --
CONTINUED 2
Of the Wynnefield Group's proposal to provide for CUMULATIVE VOTING FOR
DIRECTORS, ISS' report concluded that cumulative voting "is an important tool in
the protection of shareholders' rights" and that, "IN THIS CASE, THE COMPANY
FAILS TO MEET ALL OF THE AFOREMENTIONED CORPORATE GOVERNANCE AND PERFORMANCE
CRITERIA. The company's board is classified. ACCORDINGLY, THE PROPOSAL WARRANTS
SHAREHOLDER SUPPORT."
ISS urged FAvS shareholders to vote FOR the election of Nelson Obus as director
and FOR the provision of cumulative voting for directors on the Wynnefield
Group's GREEN proxy card and AGAINST FAvS' nominees. The full text of the ISS
analysis is available to ISS members at its website: www.issproxy.com.
The Annual Meeting of FAvS shareholders will be held on June 15, 2004 at 9:30
a.m. local time at the offices of Aerospace Products International, Inc., 3778
Distriplex Drive North, Memphis, TN 38118.
The WYNNEFIELD GROUP URGES SHAREHOLDERS TO SIGN, DATE AND RETURN THE GREEN PROXY
CARD VOTING FOR the election of Nelson Obus as director and FOR the provision of
cumulative voting for directors. For more information, shareholders can call
MacKenzie Partners at (800) 322-2885 or Nelson Obus at (212) 760-0134, or can
visit www.rescuefavs.com.
ADDITIONAL INFORMATION:
Shareholders are advised to read the Wynnefield Group's definitive proxy
statement, which contains important information. Shareholders may obtain a free
copy of the proxy statement and other documents filed by the Wynnefield Group
with the SEC at the SEC's internet website at www.sec.gov. The proxy statement,
a proxy card, and other documents may also be obtained free of charge from the
Wynnefield Group's proxy solicitor or from the Wynnefield Group by request to:
Lawrence E. Dennedy or Nelson Obus
Daniel M. Sullivan The Wynnefield Group
MacKenzie Partners, Inc. 450 Seventh Avenue
105 Madison Avenue Suite 509
New York, NY 10016 New York, NY 10123
Phone: (800) 322-2885 Phone: (212) 760-0134
If you have lost your proxy card from the Wynnefield Group, or did not receive
one, you may obtain another proxy statement and card by contacting MacKenzie
Partners, Inc. or The Wynnefield Group at the phone numbers listed above.
ABOUT THE WYNNEFIELD GROUP:
The Wynnefield Group is First Aviation's largest outside shareholder, holding
29.7% of the company's outstanding common stock. Wynnefield is a long-term
investor in FAvS, having first invested in the company shortly after its initial
public offering more than six years ago.
The Wynnefield Group includes several affiliates of Wynnefield Capital, Inc.
(WCI), a value investor, specializing in U.S. small cap situations that have
company- or industry-specific catalysts. WCI was established in 1992. Its
founding partners, Nelson Obus and Joshua Landes, held senior research and
institutional equity positions at Lazard Freres & Co. during the 1980s, and the
initial Wynnefield investors included many of their colleagues at Lazard. The
fund has grown to approximately $200 million under management. Nelson Obus
currently serves on the boards of directors of two publicly traded companies,
Layne Christensen Company (NASDAQ: LAYN) and Sylvan Inc. (NASDAQ: SYLN) and
additionally serves on the audit committees of both companies and the
compensation committee of Layne.
More information about the Wynnefield Group's efforts to help provide value to
all FAvS shareholders can be found at www.rescuefavs.com.
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