SCHEDULE 14A INFORMATION
(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 (AMENDMENT NO. ___)
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, For Use of the
/X/ Definitive Proxy Statement Commission Only (as permitted
/ / Definitive Additional Materials by Rule 14a-6(e)(2))
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
COMMISSION FILE NO. 0-23224
GREAT LAKES AVIATION, LTD.
(Name of Registrant as Specified In Its Charter)
(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:__________________________________________________________
GREAT LAKES AVIATION, LTD.
1022 AIRPORT PARKWAY
CHEYENNE, WYOMING 82001
April 27, 2000
Dear Shareholder of Great Lakes Aviation, Ltd.:
You are cordially invited to attend the Annual Meeting of Shareholders of
Great Lakes Aviation, Ltd., to be held at the Company's new facility, located at
1022 Airport Parkway, Cheyenne, Wyoming, on Friday, May 19, 2000, at 10:00 a.m.,
Cheyenne time.
At the Annual Meeting you will be asked to vote for the election of four
directors of the Company. The accompanying material contains the Notice of
Annual Meeting, the Proxy Statement which includes information about the matters
to be acted upon at the Annual Meeting and the related Proxy Card.
I encourage you to attend the Company's Annual Meeting. Whether or not you
are able to attend the Annual Meeting in person, I urge you to sign and date the
enclosed Proxy and return it promptly in the enclosed envelope. If you do attend
the Annual Meeting in person, you may withdraw your Proxy and vote personally on
any matters properly brought before the Annual Meeting.
Very truly yours,
GREAT LAKES AVIATION, LTD.
/s/ Douglas G. Voss
Douglas G. Voss
Chairman of the Board, President and
Chief Executive Officer
GREAT LAKES AVIATION, LTD.
1022 AIRPORT PARKWAY
CHEYENNE, WYOMING 82001
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FRIDAY, MAY 19, 2000
------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Great
Lakes Aviation, Ltd. (the "Company") will be held at the Company's new facility,
1022 Airport Parkway, Cheyenne, Wyoming, on Friday, May 19, 2000, at 10:00 a.m.,
Cheyenne time, for the following purposes, as more fully described in the
accompanying Proxy Statement:
1. To elect four directors for the ensuing year and until their
successors are duly elected and qualified; and
2. In their discretion, the proxies are authorized to vote upon such
other business as may properly come before the Annual Meeting or any
adjournment or postponement thereof.
The transfer books of the Company will not be closed for the Annual
Meeting. Only shareholders of record at the close of business on April 24, 2000,
are entitled to notice of and to vote at the Annual Meeting.
All shareholders are cordially invited and requested to attend the Annual
Meeting in person. Shareholders who are unable to attend in person are requested
to complete, date and sign the enclosed proxy exactly as your name appears
thereon and promptly return it in the envelope provided, which requires no
postage if mailed in the United States. Your proxy is being solicited by the
Board of Directors of the Company. Your attendance at the Annual Meeting,
whether in person or by proxy, is important to ensure a quorum. If you return
your proxy, you still may vote your shares in person by giving written notice
(by subsequent proxy or otherwise) to the Secretary of the Company at any time
prior to your vote at the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Douglas G. Voss
Douglas G. Voss
Chairman of the Board, President and
Chief Executive Officer
Cheyenne, Wyoming
April 27, 2000
GREAT LAKES AVIATION, LTD.
1022 Airport Parkway
Cheyenne, Wyoming 82001
---------------------
PROXY STATEMENT
FOR
2000 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FRIDAY, MAY 19, 2000
--------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board of Directors" or the "Board") of
Great Lakes Aviation, Ltd. (the "Company" or "Great Lakes"), to be voted at the
Annual Meeting of Shareholders (the "Annual Meeting") to be held at the
Company's new facility, 1022 Airport Parkway, Cheyenne, Wyoming, on Friday, May
19, 2000, at 10:00 a.m., Cheyenne time, and at any adjournment or postponement
thereof. The Notice of Annual Meeting, this Proxy Statement and the enclosed
proxy are first being mailed to Shareholders on or about April 27, 2000.
The Board of Directors knows of no business which will be presented at the
Annual Meeting other than the matters referred to in the accompanying Notice of
Meeting. However, if any other matters are properly presented at the Annual
Meeting, it is intended that the persons named in the proxy will vote on such
matters in accordance with their best judgement. Shares of Common Stock
represented by properly executed proxies on which no specification has been made
will be voted in favor of the election of the nominees for directors listed
herein. If any other matters are properly presented at the Annual Meeting for
action, including a question of adjourning the Annual Meeting from time to time,
the persons named in the proxies and acting thereunder will have discretion to
vote on such matters in accordance with their best judgment.
RECORD DATE AND OUTSTANDING COMMON STOCK
Only holders of Common Stock of the Company whose names appear of record on
the books of the Company at the close of business on April 24, 2000 (the "Record
Date"), are entitled to receive notice of, and to vote at, the Annual Meeting.
On the Record Date, the issued and outstanding voting shares of the Company
consisted of 8,647,891 shares of Common Stock, each entitled to one vote per
share.
REVOCABILITY OF PROXIES
Any shareholder who executes and returns a proxy may revoke it at any time
before it is voted. Any shareholder who wishes to revoke a proxy can do so by
(i) executing a later-dated proxy relating to the same shares and delivering it
to the Vice President-Finance of the Company prior to the vote at the Annual
Meeting, (ii) filing a written notice of revocation bearing a later date than
the proxy with the Vice-President Finance of the Company prior to the Annual
Meeting, or (iii) appearing in person at the Annual Meeting, filing a written
notice of revocation and voting in person the shares to which the proxy relates.
Any written notice or subsequent proxy should be delivered to Great Lakes
Aviation, Ltd., 1022 Airport Parkway, Cheyenne, Wyoming 82001, Attention:
Richard A. Hanson, Vice President-Finance or hand-delivered to Mr. Hanson prior
to the vote at the Annual Meeting.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
The presence, in person or by proxy, of the holders of at least a majority
of the shares of Common Stock outstanding and entitled to vote is necessary to
constitute a quorum for the transaction of business at the Annual Meeting. All
votes will be tabulated by the inspector of election for the Annual Meeting, who
will separately tabulate affirmative and negative votes, abstentions and broker
non-votes.
If a properly executed proxy is returned and the shareholder has abstained
from voting on any matter, the shares represented by such proxy will be
considered present at the Annual Meeting for purposes of determining whether a
quorum is present, but will not be considered to have been voted in favor of
such matter.
If a properly executed proxy is returned by a broker holding shares in
street name which indicates that the broker does not have discretionary
authority as to certain shares to vote on one or more matters, such shares will
be considered present at the Annual Meeting for determining a quorum, but will
not be considered to be represented at the Annual Meeting for purposes of
calculating the vote with respect to such matter.
2
SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS
The following table contains certain information as of April 15, 2000
regarding the beneficial ownership of the Common Stock by (i) each person known
to the Company to own beneficially five percent or more of the Common Stock,
(ii) each director of the Company, (iii) each executive officer of the Company
and (iv) the directors and executive officers as a group. Any shares which are
subject to an option or a warrant exercisable within 60 days are reflected in
the following table and are deemed to be outstanding for the purpose of
computing the percentage of Common Stock owned by the option or warrant holder
but are not deemed to be outstanding for the purpose of computing the percentage
of Common Stock owned by any other person. Unless otherwise indicated, each
person in the table has sole voting and investment power as to the shares shown.
Unless otherwise indicated, the address for each listed shareholder is c/o Great
Lakes Aviation, Ltd., 1022 Airport Parkway, Cheyenne, Wyoming 82001.
AMOUNT AND NATURE PERCENTAGE OF
OF BENEFICIAL OWNERSHIP(1) OUTSTANDING STOCK
---------------------------- -----------------------
Douglas G. Voss........................................... 5,400,000(2)(3) 58.9%
Gayle R. Brant............................................ 2,350,000(2)(3) 27.2%
Raytheon Aircraft Credit Corporation...................... 1,000,000(4) 10.4%
10511 East Central
Wichita, Kansas 67206
Tennebaum & Co., LLC...................................... 816,200(5) 8.9%
1999 Avenue of the Stars, 32nd Floor
Los Angeles, California 90067
Michael E. Tennebaum...................................... 816,200(6) 8.9%
1999 Avenue of the Stars, 32nd Floor
Los Angeles, California 90067
Iowa Great Lakes Flyers, Inc.............................. 500,000(7) 5.8%
1965 330th Street
Spencer, Iowa 51301
Richard H. Fontaine....................................... 19,000(8) *
Vernon A. Mickelson....................................... 17,000(9) *
1209 3rd Avenue West
Spencer, Iowa 51301
Jeffery M. Davis.......................................... 11,700(10) *
James A. Frazier.......................................... 11,600(11) *
W. Eric Winger............................................ 8,100(12) *
Richard A. Hanson......................................... 4,876(13) *
Ivan L. Simpson........................................... 4,000(14) *
21261 North Bay Drive
Spirit Lake, Iowa 51360
Joseph K. Kiernan......................................... - 0%
All directors and officers as a group..................... 5,476,276 59.3%
(10 persons) (15)
- --------------------
* Indicates ownership of less than 1% of the outstanding shares of Common Stock.
3
(1) The securities "beneficially owned" by a person are determined in
accordance with the definition of "beneficial ownership" set forth in
the regulations of the Securities and Exchange Commission (the
"Commission") and accordingly, may include securities owned by or for,
among others, the spouse, children or certain other relatives of such
person as well as other securities as to which the person has or shares
voting or investment power or has the right to acquire within 60 days
of April 15, 2000. The same shares may be beneficially owned by more
than one person.
(2) Ms. Brandt has granted to Mr. Voss an irrevocable proxy to vote all of
her shares of Common Stock (the "Shares") until June 28, 2010. Mr. Voss
and Ms. Brandt have also entered into a Shareholder Buy-Sell Agreement
(the "Agreement") with respect to the Shares. The term of the Agreement
(the "Term") is until June 28, 2010 or until such time as Ms. Brandt
does not own any Shares or the Company is dissolved or liquidated.
Pursuant to the Agreement, Ms. Brandt could not sell any Shares until
June 28, 1999, at which time she is able to sell 470,000 Shares and an
additional 235,000 Shares in each year thereafter. Mr. Voss, however,
has been granted a right of first refusal to purchase for the market
price any Shares which Ms. Brandt desires to so sell. The Agreement
also provides Mr. Voss the option to purchase any Shares at any time
during the Term for the market price of shares of Common Stock. The
Agreement provides that in any transaction in which Mr. Voss sells
greater than 5% of his shares of Common Stock, Mr. Voss has the right
to compel Ms. Brandt to include the Shares held by her in such
transaction on the same terms as the shares of Common Stock of Mr.
Voss. In turn, Ms. Brandt has the right to have her Shares included by
Mr. Voss in any such transaction on a pro rata basis. The Agreement
also provides Mr. Voss with the right to purchase the Shares at the
market price upon the death of Ms. Brandt or upon an involuntary
disposition of the Shares held by Ms. Brandt. Pursuant to the
Agreement, Mr. Voss will vote all shares of Common Stock beneficially
owned by him (including the Shares) for the election of Ms.
Brandt to the Board.
(3) Mr. Voss is the beneficial owner of 5,400,000 shares of Common Stock,
which includes 20,000 shares of Common Stock subject to currently
exercisable options. Ms. Brandt is the record owner of 2,350,000 shares
of Common Stock. The shares of Common Stock owned by Ms. Brandt and the
shares of Common Stock owned by Iowa Great Lakes Flyers, Inc. are
included in the 5,400,000 shares of Common Stock reported by Mr. Voss.
(4) Consists of a warrant for the purchase of an aggregate of 1,000,000
shares of Common Stock.
(5) Beneficial ownership of all 816,200 shares of Common Stock is shared
with Michael E. Tennebaum.
(6) Beneficial ownership of all 816,200 shares of Common Stock is shared
with Tennebaum & Co., LLC.
(7) Beneficial ownership of all 500,000 shares of Common Stock is shared
with Douglas G. Voss.
(8) Consists of 19,000 shares of Common Stock subject to currently
exercisable options.
(9) Includes 10,000 shares of Common Stock subject to currently exercisable
options.
(10) Consists of 11,700 shares of Common Stock subject to currently
exercisable options.
(11) Consists of 11,600 shares of Common Stock subject to currently
exercisable options.
(12) Includes 7,600 shares of Common Stock subject to currently exercisable
options.
(13) Includes 3,000 shares of Common Stock subject to current exercisable
options.
(14) Consists of 4,000 shares of Common Stock subject to currently
exercisable options.
(15) Includes an aggregate of 586,900 shares of Common Stock subject to
currently exercisable options and warrants.
4
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth the aggregate cash compensation paid to
or accrued by the Company's Chief Executive Officer and each of the Company's
executive officers who received compensation in excess of $100,000 (the "Named
Executive Officers") for services rendered to the Company during the fiscal
years ended December 31, 1999, December 31, 1998 and December 31, 1997.
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
-------------------
AWARDS
SECURITIES
ANNUAL COMPENSATION UNDERLYING
-----------------------------------
NAME AND PRINCIPAL POSITION FISCAL YEAR SALARY OPTIONS(#)
- --------------------------------------------------------- ------------------ ---------------- --------------------
Douglas G. Voss...................................... 1999 $ 151,250 --
1998 $ 151,250 100,000(1)
1997 $ 127,500 --
Thomas J. Ahmann(2).................................. 1999 $ 120,000 50,000
(1) On July 1, 1998, the Company granted Mr. Voss an option to purchase
100,000 shares of Common Stock. In connection with such grant, the
Company's Compensation Committee received a Competitive Review of the
Executive Compensation Program for the Chief Executive Officer, stating
that the options granted to Mr. Voss were competitive and appropriate in
light of comparable companies, particularly given the Company's improving
performance and the fact that Mr. Voss does not receive any form of short
term incentives.
(2) Mr. Ahmann's employment commenced on January 25, 1999 at an annual base
salary of $120,000. Mr. Ahmann is no longer employed by the Company,
effective April 14, 2000.
The following table summarizes stock option grants during the fiscal year
ended December 31, 1999 to the Named Executive Officers and certain other
information relative to such options.
OPTION GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
PERCENT OF
NUMBER OF TOTAL POTENTIAL REALIZABLE
SECURITIES OPTIONS VALUE AT ASSUMED
UNDERLYING GRANTED TO ANNUAL RATES OF STOCK
OPTIONS EMPLOYEES IN EXERCISE PRICE FOR OPTION
NAME GRANTED FISCAL YEAR PRICE EXPIRATION DATE TERMS(1)
-----------------------
5% 10%
- --------------------------------------------------------------------------------------------------------------------
Thomas J. Ahmann(2)............ 50,000 100% $2.75 January 24, 2009 86,473 219,140
(1) The 5% and 10% assumed rates of appreciation are mandated by the rules of
the Commission and do not represent the Company's estimate or projection
of the future Common Stock price.
(2) Mr. Ahmann is no longer employed by the Company, effective April 14,
2000.
5
The following table sets forth information concerning the unexercised
options held by the Named Executive Officers as of December 31, 1999. No options
were exercised by the Named Executive Officers during fiscal year 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
Number of Securities Underlying Value of In-the Money Options
Options at FY-End at FY-End(1)
Name Exercisable/Unexercisable Exercisable/Unexercisable
- ---------------------------------------------- -------------------------------- --------------------------------
Douglas G. Voss......................... 20,000/80,000(2) 0
Thomas J. Ahmann(3)..................... 0/50,000 0
- -------------
(1) Market value of underlying securities at fiscal year end minus the
exercise price.
(2) On July 1, 1998, the Company granted Mr. Voss an option to purchase
100,000 shares of Common Stock. In connection with such grant, the
Company's Compensation Committee received a Competitive Review of the
Executive Compensation Program for the Chief Executive Officer, stating
that the options granted to Mr. Voss were competitive and appropriate in
light of comparable companies, particularly given the Company's improving
performance and the fact that Mr. Voss does not receive any form of short
term incentives.
(3) Mr. Ahmann is no longer employed by the Company, effective April 14,
2000.
EMPLOYMENT AGREEMENTS, TERMINATION OF EMPLOYMENT AND
CHANGE IN CONTROL AGREEMENTS
The Company and Roland G. Bergeson, a former executive officer of the
Company, were parties to a letter agreement executed July 1, 1998 which governed
his employment with the Company during fiscal year 1999. The agreement set Mr.
Bergeson's initial compensation level at $140,000 annually and made him eligible
for salary increases, bonuses, benefits and option grants under stock option
plans. Pursuant to the Agreement, Mr. Bergeson received a 10-year option for the
purchase of 50,000 shares of the Company's Common Stock. This option had an
exercise price of $2.75 and vested over a five year period. Pursuant to the
agreement, Mr. Bergeson's employment was voluntary and was able to be terminated
by the Company or Mr. Bergeson at any time with six months prior written notice,
provided, however, that if the Company terminated Mr. Bergeson's employment
without cause, Mr. Bergeson would have received an amount equal to his base
salary per month at the end of each of the six months immediately following the
date of termination but in no event would he have received any such payments
after he gained employment elsewhere. The Company could have immediately
terminated Mr. Bergeson's employment for cause upon written notice to Mr.
Bergeson. The agreement also provided for accelerated vesting of unvested stock
options if a change of the ownership of the Company occurred. Pursuant to this
letter agreement, Mr. Bergeson received approximately $70,000 in compensation
for the fiscal year ended December 31, 1999. Mr. Bergeson is no longer employed
by the Company, effective June 30, 1999.
The Company and Thomas J. Ahmann, a former executive officer of the
Company, were parties to a letter agreement executed on January 25, 1999 which
governed his employment with the Company during fiscal year 1999. The agreement
set Mr. Ahmann's initial compensation level at $120,000 and made him eligible
for salary increases, bonuses, benefits and option grants under stock option
plans. Pursuant to the Agreement, Mr. Ahmann received a 10-year option for the
purchase of 50,000 shares of the Company's Common Stock. This option has an
exercise price of $2.75 and vests over a five year period. Pursuant to the
agreement, Mr. Ahmann's employment was voluntary and was able to be terminated
by the Company or Mr. Ahmann at any time with six months prior written
notice, provided, however, that if the Company terminated Mr. Ahmann's
employment without cause, Mr. Ahmann would have received an amount equal to
his base salary per month at
6
the end of each of the six months immediately following the date of termination
but in no event would he have received any such payments after he gained
employment elsewhere. The Company could have immediately terminated Mr. Ahmann's
employment for cause upon written notice to Mr. Ahmann. The agreement also
provided for accelerated vesting of unvested stock options if a change of
ownership of the Company occurred. Pursuant to this letter agreement, Mr. Ahmann
received $120,000 in compensation for the fiscal year ended December 31, 1999.
Mr. Ahmann is no longer employed by the Company, effective April 14, 2000.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
COMPANY'S PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE
FILINGS, INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING
REPORT AND THE "COMPANY STOCK PERFORMANCE" SECTION BELOW SHALL NOT BE
INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS.
REPORT ON REPRICING OF OPTIONS
In May 1995, the Compensation Committee approved resolutions authorizing
the exchange and repricing ("repricing") of certain outstanding stock options
held by employees of the Company whereby each employee could voluntarily
surrender and cancel his or her existing stock options and receive new options
exercisable for 70% of the number of shares of Common Stock underlying the
previous options, on the terms described below. The Compensation Committee noted
that the overall purpose of the Company's stock option plans had been to attract
and retain the services of the Company's employees and to provide incentives to
such persons to exert maximum efforts for the Company's success. The
Compensation Committee concluded that the decline in the market value of shares
of Common Stock had frustrated these purposes and diminished the value of the
Company's stock option program as an element of the Company's overall
compensation arrangements. Further, the Compensation Committee expressed its
view that a repricing program could also reduce the number of shares of Common
Stock issuable upon exercise of outstanding options. Accordingly, the
Compensation Committee adopted a repricing program with the following elements:
All employees of the Company holding options (the "Old Options") to
purchase shares of Common Stock at the time of the repricing would be eligible
to participate in the repricing program. Each such participant who so chose
could cancel any Old Options and in exchange would receive a grant of new
options (the "New Options") for 70% of the number of shares underlying the
canceled Old Options. At the time of the repricing, the exercise price of such
Old Options was $11.00 per share of Common Stock. The exercise price of all New
Options is $3.88 per share of Common Stock. Vesting under the Old Options did
not transfer to the New Options. New Options replacing Old Options would vest in
equal amounts over a five year period, beginning May 19, 1996. The term of each
New Option was ten years and the exercise price of the New Options was the fair
market value on the date of grant.
The Compensation Committee:
Vernon A. Mickelson
Ivan L. Simpson
7
BOARD REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee determined the compensation arrangements for
the Company's executive officers for 1999 in July 1999. The Compensation
Committee's principal responsibility is to ensure the Company's executive and
director compensation plans are aligned with and promote the Company's business
objectives. In particular, because the operations of the Company have moved to
Cheyenne, Wyoming during the past year the Compensation Committee is seeking to
structure and implement an executive compensation package which will attract and
retain executives capable of managing these operations and assuring the future
success of the Company.
The Company's executive compensation package in 1999 consisted of two
main components: (i) base salary, and (ii) stock options. The base salary of
each of the executive officers was determined after considering the
responsibilities and performance of the individual officer, the experience of
the individual officer and base salaries for comparable companies. The
Compensation Committee believes that the Company's compensation programs for
executive officers of the Company and stock option grants under the Company's
1993 Stock Option Plan, which was approved by the Company's shareholders, are
designed to align the long-term interests of the Company's executives and its
shareholders and assist in the retention of executives.
In determining the compensation package for Douglas G. Voss, the Chief
Executive Officer of the Company, the Compensation Committee noted that the
ownership by Mr. Voss of a substantial number of shares of Common Stock uniquely
aligns his long-term interests with the Company's shareholders. In light
thereof, the Compensation Committee has historically not tied Mr. Voss'
compensation to Company performance.
Compensation Committee:
Vernon A. Mickelson
Ivan L. Simpson
8
COMPANY STOCK PERFORMANCE
Set forth below is a graph prepared by the Center for Research in
Security Prices ("CRSP") comparing the cumulative total shareholder return on
shares of Common Stock since January 20, 1994, the effective date of the
Company's initial public offering, through December 31, 1999, with the
cumulative total return on the CRSP Total Returns Index for The NASDAQ Stock
Market (U.S. Companies) and the CRSP Total Returns Index for NASDAQ Stocks (SIC
4510-4529 US) (an index of peer companies represented by companies engaged in
air transportation, and regional airlines) for the same period. The graph
assumes an initial investment of $100.00 and reinvestment of dividends, if any.
[GRAPH]
- ----------------------------------------------------------------------------------------------
LEGEND
CRSP Total Returns Index for: 12/1994 12/1995 12/1996 12/1997 12/1998 12/1999
- ----------------------------- ------- ------- ------- ------- ------- -------
Great Lakes Aviation, Ltd. 100.0 75.0 50.0 35.0 57.5 40.0
Nasdaq Stock Market (U.S. Companies) 100.0 141.3 173.9 213.1 300.4 556.0
NASDAQ Stocks (SIC4510-4529 US) 100.0 236.8 183.8 231.0 213.3 171.8
Air Transportation Services
NOTES:
A. The lines represent monthly index levels derived from compounded daily
returns tat include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading day,
the preceding trading day is used.
D. The index level for all series was set to $100.0 on 12/30/1994.
- ----------------------------------------------------------------------------------------------
9
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The persons named in the accompanying proxy will vote for the election of
the below named nominees, unless authority to vote is withheld. Each of the four
nominees presented for director is currently a member of the Board and was
previously elected by the Company's shareholders. Directors of the Company are
elected annually to serve until the next Annual Meeting of Shareholders or until
their successors are duly elected and qualified. The Board unanimously
recommends a vote for each of the following nominees. All nominees have agreed
to stand for election at the Annual Meeting. If, prior to the Annual Meeting,
the Board learns that any nominee will be unable to serve by reason of death,
incapacity, or other unexpected occurrence, the proxies which would have
otherwise been voted for such nominee will be voted for a substitute nominee, if
any, elected by the Board.
NOMINEES FOR ELECTION AS DIRECTOR
The following table sets forth certain information regarding the nominees
for election as director of the Company. All of the directors of the Company
elected at the Annual Meeting will serve until their successors are duly elected
and qualified.
NAME AGE TITLE
- ---- --- -----
Douglas G. Voss 45 President, Chief Executive Officer and Chairman of
the Board of Directors
Vernon A. Mickelson 73 Director
Gayle R. Brandt 40 Director
Ivan L. Simpson 49 Director
The following describes the business, the business experience and
background of the nominees, each of whom currently serves as a director of the
Company.
DOUGLAS G. VOSS, age 45, co-founded the Company in 1979 and has served in
the positions of Chief Executive Officer and a director of the Company since the
Company's inception. Mr. Voss became a pilot in 1974 and holds both an Airline
Transport Pilot Certificate and an Airframe and Powerplant Mechanic Certificate.
Mr. Voss is a graduate of Colorado Aero Tech. In 1977 and 1978, Mr. Voss was
employed as a mechanic for a subsidiary of Executive Beechcraft, Inc. Mr. Voss
has also served the Company in a number of operational positions, including
Director of Maintenance and Director of Operations.
VERNON A. MICKELSON, age 73, became a director of the Company in December
1993. For more than the past eight years, Mr. Mickelson has been self-employed
as a consultant and has provided services to the Company concerning matters
involving Federal Aviation Administration ("FAA") regulatory compliance and
maintenance quality control. Mr. Mickelson has worked in the aviation industry
since 1949, primarily in the field of aircraft maintenance. From 1973 to 1988,
Mr. Mickelson was employed by the FAA as a supervisor of FAA maintenance and
avionics inspectors operating in the State of Iowa.
GAYLE R. BRANDT, age 40, has been a director of the Company since December
1996. Ms. Brandt has held various positions with the Company since its inception
including assisting in the management of the Spirit Lake Airport from 1978
through 1992, Station Agent and Station Manager responsible for all airline
reservations from 1982 through 1985, Airline Accounts Receivable and Revenue
Accounting Manager from 1985 through 1989, Airline Executive Office Receptionist
from 1989 through 1996 and Director of Airport Services and Airport Manager from
June 1996 through the present.
IVAN L. SIMPSON, age 49, became a director of the Company in 1997. Mr.
Simpson co-founded the Company in 1979, and served in various operational roles
through 1987, including: Chief Pilot, Director of Security, and most recently,
Vice President and Director of Operations. He has been employed as an Airline
10
Transport Pilot for American Airlines since 1987. Mr. Simpson holds an Airline
Transport Pilot Certificate and is Type rated in the Boeing 757/767 aircraft.
THE BOARD AND COMMITTEES
In 1999 the Board held two meetings. Each of the incumbent directors
attended all of the meetings of the Board and each Committee of which he or she
was a member held during 1999.
On June 25, 1999 the Board ratified the members of its Audit Committee and
its Compensation Committees for 1999. The members of each committee during 1999
were Mr. Vernon A. Mickelson and Mr. Ivan L. Simpson.
The Audit Committee is empowered by the Board to review the financial books
and records of the Company in consultation with the Company's accounting and
auditing staff and its independent public accountants and to consider any
questions raised with respect to accounting and auditing policies and
procedures. During 1999, the Audit Committee held one meeting.
The Compensation Committee is authorized by the Board to establish general
levels of compensation for all employees of the Company, to set the annual
salary of each of the executive officers of the Company, to grant options to
employees under the Company's option plans, and to review and approve
compensation and benefit plans of the Company. During 1999, the Compensation
Committee held one meeting.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As stated above, Messrs. Mickelson and Simpson comprised the Compensation
Committee for purposes of setting compensation levels for 1999. No member of the
Compensation Committee was an officer or employee of the Company or its
subsidiary during the fiscal year ended December 31, 1999. Mr. Simpson was an
officer and employee of the Company from 1979 through 1987. No executive officer
of the Company served as a member of the Compensation Committee or board of
directors of another entity, one of whose executive officers served on the
Company's Compensation Committee or Board during the fiscal year ended December
31, 1999.
COMPENSATION OF DIRECTORS
Directors of the Company who are not employees of the Company participate
in the Company's Director Stock Option Plan, receive $1,000 for each meeting of
the Board or a meeting of a committee of the Board attended (not to exceed
$1,000 per day) and are reimbursed for out-of-pocket expenses incurred on behalf
of the Company.
REQUIRED VOTE
Election as a director requires the affirmative vote of the holders of a
majority of the shares of Common Stock represented in person or by proxy and
entitled to vote at the Annual Meeting. THE BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF THE NOMINEES LISTED ABOVE.
11
CERTAIN TRANSACTIONS
Douglas G. Voss is the sole owner of Iowa Great Lakes Flyers, Inc.
("Flyers"), a corporation which owns and operates four-passenger and
six-passenger aircraft and one Beech 1900 aircraft, and owns a fleet of rental
cars. From time to time, Flyers leases its four-passenger and six-passenger
aircraft to the Company for use in its charter and freight operations. The
Company believes that its leases of aircraft from Flyers are on terms no less
favorable to the Company than would be similar transactions with unaffiliated
third parties. Under these leases, the Company paid to Flyers a total of
approximately $609,000 for leased planes and $19,000 for automobile rental
payments during the year ended December 31, 1999. Additionally, from time to
time Flyers loans funds to the Company on a short term basis. As of April 27,
2000, the Company had no outstanding balances due to Flyers.
The Company had employment agreements in effect during fiscal year 1999
with Roland G. Bergeson and Thomas J. Ahmann both of whom were executive
officers of the Company during fiscal year 1999. The employment agreements
are described in "Executive Compensation."
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers and directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Commission and provide the Company
with copies of such reports. Based solely on its review of the copies of such
forms received by it, or written representations from certain reporting persons,
the Company believes that, during the last fiscal year, its directors and
executive officers filed all reports on a timely basis, except as follows: (a)
initial report on Form 3 following the appointment of Roland G. Bergeson as an
executive officer of the Company through inadvertence was filed late; and (b)
Securities ownership reports on Form 4 following the issuance of stock pursuant
to the Company's Employee Stock Purchase Plan to Roland G. Bergeson, Jeffery M.
Davis, Richard A. Hanson and James A. Tostenrud, each of whom are or were
executive officers of the Company, through inadvertence were filed late.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following table provides information with respect to the Company's
executive officers as of April 15, 2000. Each such person has been appointed to
serve until his or her successor is duly appointed by the Board or his or her
earlier removal or resignation from office.
NAME AGE TITLE
- ---- --- -----
Douglas G. Voss 45 Chief Executive Officer, President and Chairman of
the Board of Directors
Jeffery M. Davis 37 Chief Operating Officer
Richard H. Fontaine 59 Senior Vice President-Marketing
Richard A. Hanson 41 Vice President-Finance
James A. Frazier 41 Vice President-Customer Service
W. Eric Winger 45 Vice President-Product Development
Joseph K. Kiernan 49 Vice President - Maintenance
DOUGLAS G. VOSS - See "Election of Directors"
JEFFERY M. DAVIS. Mr. Davis joined Great Lakes in March 1988 as a
commercial pilot. He has served in many positions within the Flight Operations
area of the Company, including Line Pilot, Instructor, Check-Airman, and
Director of Training. He was promoted to his current position as Chief Operating
Officer in June
12
1999. Mr. Davis is the holder of an Airline Transport Pilot Certificate and
is currently a Designated Pilot Examiner for the Federal Aviation
Administration.
RICHARD H. FONTAINE. Mr. Fontaine rejoined Great Lakes in his present
position as Senior Vice President of Marketing on September 15, 1995. He
previously had held the position of President from 1988 to 1993. In the interim,
he was employed by GP Express Airlines ("GP Express") as Executive Vice
President, Marketing and Planning. Subsequent to Mr. Fontaine's departure, GP
Express entered into Chapter 11 proceedings under the federal bankruptcy laws.
RICHARD A. HANSON. Mr. Hanson rejoined Great Lakes as Controller in June
1997. He was promoted to his current position of Vice President of Finance in
April of 2000. He previously held the positions at Great Lakes of Senior Vice
President - Finance from 1993 to 1994, and Controller from 1990 to 1993. In the
interim, Premium Standard Farms employed him as Corporate Finance Manager.
Previously he had been at First Image Corporation as Regional Manager of Finance
and Administration from 1988 to 1990. Mr. Hanson is a Certified Public
Accountant.
JAMES A. FRAZIER. Mr. Frazier joined Great Lakes in March 1990 as Director
of Stations and was promoted to his present position of Vice President of
Customer Service in March 1992.
W. ERIC WINGER. Mr. Winger has been with Great Lakes for over 18 years.
Since 1982, Mr. Winger has held the position of Vice President of Product
Development.
JOSEPH K. KIERNAN. Mr. Kiernan joined Great Lakes in December 1993 as
General Manager of the Company's repair station. Mr. Kiernan became the
Company's Director of Maintenance in June 1998. He was promoted to his current
position as Vice President of Maintenance in June 1999.
The officers of the Company are elected annually and serve at the
discretion of the Board of Directors.
VOTING OF PROXIES AND EXPENSES
The Board recommends that an affirmative vote be cast in favor of the
proposal listed in the Proxy.
The Board knows of no other matters that may be brought before the Annual
Meeting which require submission to a vote of the Company's shareholders. If any
other matters are properly brought before the Annual Meeting, however, the
persons named in the enclosed Proxy or their substitutes will vote in accordance
with their best judgment on such matters.
Expenses incurred in connection with the solicitation of proxies will be
paid by the Company. The Company has retained Norwest Shareowner Services to
assist in the solicitation of proxies, at an estimated cost of $3,100 plus
reimbursement of out-of-pocket expenses. The proxies are being solicited
principally by mail. In addition, directors, officers and regular employees of
the Company may solicit proxies personally or by telephone, for which they will
receive no consideration other than their regular compensation. The Company will
also request brokerage houses, nominees, custodians and fiduciaries to forward
soliciting material to the beneficial owners of shares of Common Stock and will
reimburse such persons for their expenses so incurred.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed KPMG LLP as independent public
accountants for the Company for the fiscal year ending December 31, 2000.
Representatives of KPMG LLP are expected to be present at the Annual Meeting,
will have an opportunity to make a statement if they desire to do so, and will
be available to respond to appropriate questions from shareholders in
attendance.
13
SHAREHOLDER PROPOSALS
If a shareholder of the Company wishes to present a proposal for
consideration for inclusion in the Proxy Statement for the 2001 Annual Meeting
of Shareholders, the proposal must be sent by certified mail, return receipt
requested, and must be received at the executive offices of the Company, 1022
Airport Parkway, Cheyenne, Wyoming 82001, Attn: Vice President-Finance, no later
than December 22, 2000. All proposals must conform to the rules and regulations
of the SEC. Under SEC rules, if a shareholder notifies the Company after March
7, 2001 of his or her intent to present a proposal for consideration at the 2001
Annual Meeting of Shareholders, the Company, acting through the persons named as
proxies in the proxy materials for such meeting, may exercise discretionary
authority with respect to such proposal without including information regarding
such proposal in its proxy materials.
ANNUAL REPORT
All shareholders of record as of April 24, 2000 are receiving with this
proxy statement a copy of the Company's Annual Report for the fiscal year ended
December 31, 1999, which includes the Company's Annual Report on Form 10-K. The
Form 10-K contains certified consolidated financial statements of the Company
for the fiscal year ended December 31, 1999. The Company will furnish to any
person whose proxy is being solicited, any exhibit(s) described in the exhibit
index accompanying the Form 10-K, upon the payment, in advance, of fees based on
the Company's rasonable expenses in furnishing such exhibit(s). Requests for
copies of such exhibit(s) should be directed to Richard A. Hanson, Vice
President-Finance, at Great Lakes Aviation, Ltd., 1022 Airport Parkway,
Cheyenne, Wyoming 82001.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Douglas G. Voss
Douglas G. Voss
Chairman of the Board, President, and
Chief Executive Officer
Cheyenne, Wyoming
April 27, 2000
14
GREAT LAKES AVIATION, LTD
ANNUAL MEETING OF SHAREHOLDERS
FRIDAY, MAY 19, 2000
10:00 A.M.
1022 AIRPORT PARKWAY
CHEYENNE, WYOMING 82001
GREAT LAKES AVIATION, LTD PROXY
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, having duly received the Notice of Annual Meeting of
Shareholders and the Proxy Statement, dated April 27, 2000, hereby appoints
Douglas G. Voss and Richard A. Hanson, and either of them, as proxy or
proxies, with full power of substitution, to represent the undersigned and to
vote, as designated below, all shares of Common Stock of Great Lakes
Aviation, Ltd. (the "Company") held of record by the undersigned on April 24,
2000, at the Annual Meeting of Shareholders to be held at the Company's new
facility, 1022 Airport Parkway, Cheyenne, Wyoming, on Friday, May 19, 2000,
at 10:00 a.m., Cheyenne time, and any adjournment thereof.
SEE REVERSE FOR VOTING INSTRUCTIONS.
V PLEASE DETACH HERE V
1. To elect four directors of the Company for the ensuing year and until his or her
successor shall be elected and duly qualified.
01 DOUGLAS G. VOSS 03 GAYLE R. BRANDT / / Vote FOR / / Vote WITHHELD
02 VERNON A. MICKELSON 04 IVAN L. SIMPSON all nominees from all nominees
(except as marked)
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(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL,
WRITE THAT NOMINEE'S NAME IN THE BOX PROVIDED TO THE RIGHT.)
-----------------------------------------------
2. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the
Annual Meeting or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED ON THE PROXY BY THE UNDERSIGNED SHAREHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSAL 1. ABSTENTIONS WILL BE COUNTED TOWARD THE EXISTENCE
OF A QUORUM.
Dated: ______________________________
Address Change? Mark Box / /
Indicate changes below:
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Signature(s) in Box
Please sign exactly as name appears on this Proxy.
When shares are held by joint tenants, both should
sign. If signing as attorney, executor,
administrator, trustee or guardian, please give
full title as such. If a corporation, please sign
in full corporate name by president or other
authorized officer. If a partnership, please sign
in partnership name by an authorized person.