Item 10. Directors and Executive Officers of the Registrant.
In accordance with the Company's Bylaws, the Board of Directors is divided into
three classes (two classes consisting of three directors and one class
consisting of two directors). Three directors are to be elected at the Annual
Meeting, each of whom will serve until the 2003 Annual Meeting or until their
respective successors shall have been elected or appointed.
Although the Board of Directors expects that each of the nominees will be
available to serve as a director, in the event any of them should become
unavailable prior to the Annual Meeting, the proxy will be voted for a nominee
or nominees designated by the Board of Directors, or the number of directors may
be reduced accordingly. However, the proxy cannot be voted for a greater number
of persons than the number of nominees designated by the Board of Directors.
2000 Nominees
Principal Business Experience During Past Director
Name Age 5 Years and Certain Other Directorships Since
- --------------- ----- ---------------------------------------------------------- ---------
Denis R. Brown 59 President and Chief Executive Officer and a Director of 1997
Pinkerton, Inc. since April 1994, a leading supplier of
global security solutions; Director, CalMat Co. since
January 1997.
John J. Kimes 56 President and Chief Executive Officer of Computerized 1995
Security Systems since 1988, a manufacturer of electronic
and mechancial lock hardware and systems.
H. Jack Meany 76 Chairman of the Board since April 1994; Chief Excutive 1976
Officer of the Company from February 1996 to February 1999;
President and Chief Executive Officer of the Company from
April 1994 to February 1996; Director, APS Inc. since
1990; Director, ESI, Inc. since 1980.
Continuing Directors
Principal Business Experience During Past Director Term
Name Age 5 Years and Certain Other Directorships Since Expires
- ---------------- ----- ---------------------------------------------- ----------- -----------
Robert Batinovich 63 Chairman and Chief Executive Officer of Glenborough 1994 2001
Realty Trust Incorporated since 1996, a real estate
investment company; President and majority owner of
Glenborough Corporation since 1978.
Richard P. Bermingham 60 Chairman of Bermingham Investment Company since 1997; 1990 2002
Vice Chairman of American Golf Corporation, a golf
course management company, from 1994 to 1997.
A. Frederick Gerstell 62 Vice Chairman, Director and Consultant of Vulcan 1998 2001
Materials Company since January 1999; Chairman and
Chief Executive Officer of CalMat Co., a producer of
construction materials, from 1996 to January 1999;
Chairman, President, Chief Executive Officer and
Chief Operating Officer of CalMat from 1991 to 1996;
Director, Ameron, Inc., since 1997; Director and Vice
Chairman of the National Stone Association since 1997.
John C. Johnston 56 President and Chief Executive Officer of the Company 1996 2002
since February 1999; President and Chief Operating
Officer of the Company from February 1996 to February
1999; Senior Vice President of the Company from
January 1995 to February 1996; President of Easton
Aluminum, Inc. an atheletic equipment manufacturer,
from 1986 to December 1994.
John A. Sullivan 45 Investments Advisor of Relational Investors, LLC 1996 2002
since 1998; Financial Consultant with Batchelder &
Partners, Inc., from May 1996 to March 1998; Senior
Vice President of The Seidler Companies Incorporated
from August 1993 to April 1996; Director, American
Coin Merchandising, Inc. since October 1995.
Item 11. Executive Compensation
The following table shows the compensation earned by the Company's Chief
Executive Officer and the four other most highly compensated officers whose cash
compensation for the fiscal year ended January 1, 2000 exceeded $100,000
(collectively, the "Named Officers").
Summary Compensation Table
Long Term
Compensation
-------------
Annual Compensation Awards
---------------------------- -------------
Securities All Other
Underlying Compensation
Name and Principal Position Year Salary ($) Bonus ($) Options (#) ($)(1)
- ---------------------------- ------ ----------- ------------ ------------- -------------
H. Jack Meany, 1999 187,615 82,729 250,000 21,688(3)
Chairman of the Board (2) 1998 246,002 203,307 0 23,546(3)
1997 246,002 247,834 0 25,829(3)
John C. Johnston, 1999 195,500 119,804 15,000 18,881(4)
President and Chief Executive 1998 170,000 112,397 22,500 13,187(4)
Officer (2) 1997 170,000 137,013 30,000 14,522(4)
Richard Larson, 1999 147,500 56,493 5,000 13,962(6)
Executive Vice President (5) 1998 140,000 57,851 22,500 59,065(6)
1997 72,693 36,617 15,000 30,728(6)
Steve Pegg, 1999 124,000 49,600 5,000 16,987(8)
SeniorVice President and Chief 1998 50,077 20,031 20,000 18,090(8)
Financial Officer (7)
Myron Rasmussen, 1999 117,393 25,179 0 15,945(9)
Vice President 1998 117,393 27,165 0 16,613(9)
1997 117,393 33,115 0 18,090(9)
- ----------------------------------------
(1) Excludes compensation in the form of perquisites and other personal
benefits that do not exceed the lesser of (i) $50,000 or (ii) 10% of the
total annual salary and bonus reported for each year.
(2) Effective February 16, 1999, Mr. Meany resigned from the position of the
Company's Chief Executive Officer, though he still serves the Company as
its Chairman of the Board and remains an officer of the Company. Effective
the same date, Mr. Johnston, who previously served as President and Chief
Operating Officer, assumed the role of President and Chief Executive
Officer of the Company.
(3) Consists of contributions by the Company under its Supplemental Executive
Savings Plan and 401(k) Retirement Plan (collectively, the "Retirement
Plans") except in 1999 that included $2,301 of certain life insurance
premiums paid on behalf of Mr. Meany.
(4) In 1999, consists of $15,731 of contributions by the Company under the
Retirement Plans and $3,150 of certain life insurance premiums paid on
behalf of Mr. Johnston. In 1998, consists of $9,002 of contributions by the
Company under the Retirement Plans and $4,185 of certain life insurance
premiums paid on behalf of Mr. Johnston. In 1997, consists of $11,666 of
contributions by the Company under the Retirement Plans and $2,856 of
certain life insurance premiums paid on behalf of Mr. Johnston.
(5) Mr. Larson's employment with the Company commenced in June 1997.
(6) In 1999 , consists of $12,652 of contributions by the Company under the
retirement Plans and $1,310 of certain life insurance premiums paid on
behalf of Mr. Larson. In 1998, consists of $47,662 for reimbursement of
relocation costs, $6,517 of contributions by the Company under the
Retirement Plans and $800 of certain life insurance premiums paid on behalf
of Mr. Larson. In 1997, includes $27,180 for reimbursement of relocation
costs and $770 of certain life insurance premiums paid on behalf of Mr.
Larson.
(7) Mr. Pegg's employment with the Company commenced in August 1998.
(8) In 1999, consists of $10,389 for reimbursement for relocation cost, $6,150
of contributions by the Company under the Retirement Plans and $448 of
certain life insurance premiums paid on behalf of Mr. Pegg. In 1998,
consists of $2,850 for reimbursement of relocation costs and $140 of
certain life insurance premiums paid on behalf of Mr. Pegg.
(9) In 1999, consists of $11,057 of contributions by the Company under the
Retirement Plans and $ ,000 of certain life insurance premiums paid on
behalf of Mr. Rasmussen. In 1998, consists of $10,084 of contributions by
the Company under the Retirement Plans and $6,529 of certain life insurance
premiums paid on behalf of Mr. Rasmussen. In 1997, consists of $11,130 of
contributions by the Company under the Retirement Plans and $6,960 of
certain life insurance premiums paid on behalf of Mr. Rasmussen.
OPTION GRANTS IN LAST FISCAL YEAR
Shown below is information concerning grants of options by the Company to
the Named Officers in 1999:
Potential Realizable Value at
Assumed Annual Rates of Stock
Number of % of Total Price Appreciation
Securities Options For Option Term (2)
Underlying Granted to Exercise ------------------------------------
Options Employees in Price Expiration
Name Granted(#)(1) Fiscal Year ($/Share) Date 5% 10%
- --------------- ------------- ------------- ---------- ----------- ------------------ --------------
H. Jack Meany 250,000 86.5% $9.50 2/16/09 $1,493,624 $3,785,138
John C. Johnston 15,000 5.2% $9.50 2/16/09 $ 89,617 $ 227,108
Richard Larson 5,000 1.7% $9.50 2/16/09 $ 29,872 $ 75,703
Steve Pegg 5,000 1.7% $9.50 2/16/09 $ 29,872 $ 75,703
- -------------------------------------------------------------------------------------------------------------------
(1) Such options were granted on February 16, 1999 with an exercise price equal
to the closing sale price of the Common Stock as reported on the Nasdaq
National Market on such date.
(2) The 5% and 10% assumed rates of appreciation are specified under the rules
of the SEC and do not represent the Company's estimate or projection of the
future price of the Common Stock. The actual value, if any, which a Named
Officer may realize upon the exercise of stock options will be based upon
the difference between the market price of the Common Stock on the date of
exercise and the exercise price.
STOCK OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
The following table sets forth for the Named Officers information with
respect to unexercised options and year-end option values, in each case with
respect to options to purchase shares of Common Stock held as of January 1,
2000.
Value of Unexercised In-the-
Shares Number of Unexercised Money Options at
Acquired Value Options at FY-End (#) FY-End ($) (1)
on Realized ------------------------------- ---------------------------------
Name Exercise (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ---------------- ------------- --------- -------------- -------------- -------------- ---------------
H. Jack Meany(2) 0 -- 268,000 -- 178,500 --
John C. Johnston 0 -- 119,625 46,875 771,500 30,000
Richard Larson 0 -- 13,125 29,375 -- 1,250
Steve Pegg 0 -- 5,000 20,000 -- 3,125
Myron G. Rasmussen 1,406 $6,452 34,313 -- 201,422 --
- ----------------------------------------------------------------------------------------------------------------------------
(1) Calculated based on the closing price of the Company's Common Stock ($9.75
per share) as reported on the Nasdaq National Market on January 1, 2000.
(2) Mr. Meany holds options to purchase 18,000 shares of Common Stock that were
granted pursuant to the Director Plan for his services to the Company as a
non-employee director.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information as of March 15, 2000 with
respect to shares of the Common Stock which are held by persons known to the
Company to be beneficial owners of more than 5% of the Common Stock. For
purposes of this proxy statement, beneficial ownership of securities is defined
in accordance with the rules of the SEC and means generally the power to vote or
dispose of securities, regardless of any economic interest therein.
Amount and
Nature of
Name and Address of Beneficial Owner Beneficial Ownership Percent of Class(1)
- ----------------------------------------------- -------------------- ----------------------
Wellington Management Company, LLP 693,150(2) 9.5%
75 State Street
Boston, Massachusetts 02109
Fleet Boston Corporation 553,375(3) 7.6%
One Federal Street
Boston, Massachusetts 02110
DimensionalFund Advisors, Inc. 423,985(4) 5.8%
1299 Ocean Ave, 11th Floor
Santa Monica, CA 90401
Reed Conner & Birdwell, Inc. 375,060(5) 5.2%
11111 Santa Monica Boulevard, Suite 1700
Los Angeles, California 90025
- ------------------------------------
(1) Based on 7,278,207 shares of Common Stock outstanding as of March 15, 2000
(not including 1,635,445 shares held in treasury).
(2) Based on information contained in a Schedule 13G/A filed with the SEC on
February 4, 2000.
(3) Based on information contained in a Schedule 13G filed with the SEC on
February 14, 2000.
(4) Based on information contained in a Schedule 13G/A filed with the SEC on
January 24, 2000.
(5) Based on information contained in a Schedule 13G/A filed with the SEC on
February 14, 2000.
OWNERSHIP BY MANAGEMENT
The following table sets forth as of March 15, 2000 information with
respect to the beneficial ownership of the Common Stock by each director, each
Named Officer (as defined below) and by all of the Company's directors and
executive officers as a group:
Shares Percent
Beneficially of
Name of Beneficial Owner Position Owned(1)(2) Class(1)(3)
- -------------------------- -------------------------------- ------------- ---------------
H. Jack Meany...................... Chairman of the Board........... 480,975 6.4%
Robert Batinovich.................. Director........................ 252,000 3.4%
Richard P. Bermingham.............. Director........................ 46,125 *
Denis R. Brown..................... Director........................ 24,000 *
John J. Kimes...................... Director........................ 24,000 *
John A. Sullivan................... Director........................ 26,550 *
A. Frederick Gerstell.............. Director........................ 13,500 *
John C. Johnston................... President and Chief Executive
Officer, Director............... 138,699 1.9%
Richard Larson..................... Executive Vice President........ 20,000 *
Stephen Pegg....................... Senior Vice President........... 31,250 *
Myron G. Rasmussen................. Vice President.................. 43,758 *
Directors and Executive Officers as a group (11 persons)............. 1,100,857 14.0%
- -----------------------------------
* = Less than 1%.
(1) Based on 7,278,207 shares of Common Stock outstanding as of March 15, 2000
(not including 1,635,445 shares held in treasury). Shares shown as
beneficially owned are those as to which the named persons possess sole
voting and investment power. However, under California law, personal
property owned by a married person may be community property that either
spouse may manage and control. The Company does not have any information as
to whether any shares shown in this table are subject to California
community property law.
(2) Includes shares purchasable within 60 days upon exercise of outstanding
stock options as follows: H.J. Meany, 268,000; R. Batinovich, 27,000; R.P.
Bermingham, 40,500; D. Brown, 13,500; J.J. Kimes, 22,500; J. Sullivan,
18,000; A.F. Gerstell, 9,000; J. Johnston, 136,500; R. Larson, 20,000; M.G.
Rasmussen, 16,312; Steve Pegg, 6,250; and all Directors and Executives
Officers as a group, 577,562.
(3) For purposes of computing the percentages, the number of shares of Common
Stock outstanding includes shares purchasable by such individual or group
within 60 days upon exercise of outstanding stock options.