SCHEDULE 14A
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 /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, For Use of the Commission
/X/ Definitive Proxy Statement Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-12
JP REALTY, INC.
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(Name of Registrant as Specified in its Charter)
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.
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(3) Per unit price or other underlying value of transaction
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by
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the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or
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JP Realty, Inc.
35 CENTURY PARK-WAY
SALT LAKE CITY, UTAH 84115
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 2, 2001
To the Stockholders of JP Realty, Inc.:
The 2001 Annual Meeting of Stockholders of JP Realty, Inc. (the "Company")
will be held at the University of Utah, Utah Museum of Fine Arts, The Marcia and
John Price Museum Building, 410 Central Campus Drive, Salt Lake City, Utah, on
Wednesday, May 2, 2001, at 10:00 a.m., MDT, for the following purposes:
1. To elect three Class II directors to serve on the Company's Board of
Directors for a term of three years, expiring at the 2004 Annual Meeting
of Stockholders;
2. To ratify the appointment of PricewaterhouseCoopers LLP as the Company's
independent auditors for 2001; and
3. To transact such other business as may properly come before the 2001
Annual Meeting or any postponements and adjournments thereof.
The close of business on March 23, 2001 has been fixed by the Company's
Board of Directors as the record date for the determination of the stockholders
entitled to notice of, and to vote at, the 2001 Annual Meeting or any
postponements or adjournments thereof.
We hope all stockholders who can do so will attend the 2001 Annual Meeting
in person. Whether or not you plan to attend, we urge you to complete, date and
sign the enclosed proxy card and return it promptly in the enclosed
postage-prepaid envelope provided for that purpose. By returning your proxy
promptly, you can help the Company avoid the expense of follow-up mailings to
ensure the presence of a quorum at the 2001 Annual Meeting. If you attend the
2001 Annual Meeting, you may revoke your proxy and vote your shares in person.
THE ENCLOSED PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF THE
COMPANY. THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE IN FAVOR OF THE
PROPOSED ITEMS.
By Order of the Board of Directors,
/s/ Paul K. Mendenhall
Paul K. Mendenhall
Secretary
Salt Lake City, Utah
April 2, 2001
JP Realty, Inc.
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 2, 2001
This Proxy Statement is being furnished in connection with the solicitation
of proxies by, and on behalf of, the Board of Directors of JP Realty, Inc., a
Maryland corporation (the "Company"), for use at the 2001 Annual Meeting of
Stockholders of the Company (the "Annual Meeting") to be held at the University
of Utah, Utah Museum of Fine Arts, The Marcia and John Price Museum Building,
410 Central Campus Drive, Salt Lake City, Utah, on Wednesday, May 2, 2001, at
10:00 a.m., MDT, or at any postponements or adjournments thereof.
Stockholders are requested to complete, date and sign the enclosed proxy
card (the "Proxy") and return it in the postage-prepaid envelope provided.
Valid Proxies will be voted as specified thereon at the Annual Meeting. Any
stockholder giving a Proxy in the accompanying form retains the power to revoke
such Proxy at any time prior to its exercise by delivering to the Company a
written notice of revocation or a duly executed Proxy bearing a later date or
upon request if the stockholder attends the Annual Meeting and chooses to vote
in person. Any notice of revocation sent to the Company must include the
stockholder's name and must be received prior to the Annual Meeting to be
effective. If a Proxy is properly signed, returned without specifying any
instructions and not revoked prior to the Annual Meeting, the shares represented
by such Proxy will be voted FOR the election of the nominees to serve as
Class II directors until the 2004 Annual Meeting of Stockholders and FOR
ratification of the appointment of PricewaterhouseCoopers LLP as the Company's
independent auditors for 2001.
This Proxy Statement, the Notice of Annual Meeting of Stockholders and the
Proxy are first being sent to stockholders on or about April 2, 2001.
ANNUAL REPORT
This Proxy Statement is accompanied by the Annual Report to Stockholders of
the Company for the year ended December 31, 2000, including financial statements
audited by PricewaterhouseCoopers LLP, the Company's independent auditors, and
their report thereon, dated January 31, 2001.
VOTING SECURITIES AND RECORD DATE
Holders of shares of Common Stock, $.0001 par value (the "Common Stock"), of
the Company will be entitled to one vote for each share of Common Stock held of
record at the close of business on March 23, 2001 (the "Record Date") with
respect to the election of two Class II directors to serve on the Company's
Board of Directors for a term of three years, the ratification of the
appointment of PricewaterhouseCoopers LLP as the Company's independent auditors
and any other proposal for stockholder action as may properly come before the
Annual Meeting. Holders of shares of Price Group Stock, $.0001 par value (the
"Price Group Stock"), of the Company vote together as a single class with the
holders of Common Stock on the foregoing matters and are entitled to one vote
for each share of Price Group Stock held of record at the close of business on
the Record Date. In addition, holders of shares of Price Group Stock have other
voting rights as specified below under "ELECTION OF DIRECTORS." Abstentions and
broker non-votes are each included in the determination of the number of shares
present and voting for the purposes of determining whether a quorum is present
at the Annual Meeting and each is tabulated separately. The shares of Common
Stock and Price Group Stock represented by valid Proxies
that abstain with respect to any matter will not be counted as an affirmative
vote in determining whether the requisite vote of the shares were cast in favor
of that matter.
The disposition of business scheduled to come before the Annual Meeting,
assuming a quorum is present, will require the following affirmative votes:
(i) for the election by the holders of Common Stock and Price Group Stock of two
of the nominees to serve as Class II directors, a plurality of the shares of
Common Stock and Price Group Stock, voting together as a single class, present
or represented by Proxy at the Annual Meeting; (ii) for the election by the
holders of the Price Group Stock of the remaining nominee to serve as a
Class II director, a plurality of the shares of Price Group Stock, present or
represented by Proxy at the Annual Meeting; and (iii) for the ratification of
the appointment of PricewaterhouseCoopers LLP as the Company's independent
auditors for the calendar year ending December 31, 2001, a majority of the
shares of Common Stock and Price Group Stock, voting together as a single class.
As of the Record Date, the Company had issued and outstanding 16,019,290
shares of Common Stock and 200,000 shares of Price Group Stock.
1. ELECTION OF DIRECTORS
Pursuant to the Company's Amended and Restated Articles of Incorporation and
By-Laws, the Board of Directors of the Company shall be comprised of seven
directors. The Board of Directors currently consists of seven directors, John
Price, G. Rex Frazier, Warren P. King, James A. Anderson, Allen P. Martindale,
Sam W. Souvall and A. Blaine Huntsman, and is divided into three classes, with
Messrs. Frazier and Huntsman constituting the Class I directors, Messrs. King,
Martindale and Souvall constituting the Class II directors and Messrs. Price and
Anderson constituting the Class III directors. One class of directors is elected
at each Annual Meeting of the Company's stockholders for a term of three years.
The term of the Class II directors expires at the Annual Meeting. The terms of
the other two classes of directors expire at the 2002 Annual Meeting of
Stockholders (Class III directors) and the 2003 Annual Meeting of Stockholders
(Class I directors).
Under the Company's Amended and Restated Articles of Incorporation, for the
period that John Price, his spouse and children, any lineal descendants of any
of the foregoing, any estates of any of the foregoing, any trusts created for
their benefit, and entities which any of the foregoing control (together, the
"Price Group") continue to hold a combined 10% or greater direct or indirect
economic interest in Price Development Company, Limited Partnership, a Maryland
limited partnership (the "Operating Partnership"), in which the Company holds an
81.7% controlling general partner interest and through which the Company
conducts all of its business, the holders of Price Group Stock will elect two of
the seven members of the Board of Directors and the holders of Common Stock and
Price Group Stock, voting together as a single class, will elect the remaining
five members of the Board of Directors. Of the directors serving on the Board of
Directors during 2000, the holders of the Price Group Stock were responsible for
the election of Mr. Huntsman, a Class I director, and Mr. Martindale, a
Class II director.
Messrs. King and Martindale have been nominated by the Board of Directors
for re-election as Class II directors by the holders of Common Stock and Price
Group Stock, voting together as a single class, at the Annual Meeting to serve
until the 2004 Annual Meeting of Stockholders or until their respective
successors are elected and qualified. It is intended that the shares of Common
Stock and Price Group Stock represented by properly executed Proxies will be
voted by the Proxy holders FOR the re-election of Messrs. King and Martindale,
unless authority to so vote is withheld. If the candidacy of Mr. King or
Mr. Martindale should, for any reason, be withdrawn, the Proxy holders will vote
in favor of such substituted nominee (if any) as shall be designated by the
Proxy holders. The Board of Directors has no
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reason to believe that Messrs. King and Martindale will be unable or unwilling
to serve as Class II directors if elected.
NOMINEES FOR ELECTION AS CLASS II DIRECTORS
The following information is furnished regarding the nominees for election
as Class II directors by the holders of Common Stock and Price Group Stock,
voting together as a single class.
WARREN P. KING, age 63, has been a director since the formation of the
Company and was appointed Vice Chairman of the Board of Directors in 1994. Prior
to the formation of the Company, Mr. King served as Vice Chairman of the Board
of Directors and Chairman of the Finance Committee of Fairfax Realty, Inc.
("Fairfax") beginning in 1977 and has been involved in the real estate industry
since 1974. From 1978 to January 2001, Mr. King was President and Chief
Executive Officer of Alta Industries--Utah, Inc. (a distributor of ferrous and
nonferrous metals and a manufacturer of roofing, siding, and other structural
components). Mr. King continues to be a director of Alta Industries--Utah, Inc.
He is a certified public accountant and is a graduate of Stevens Henager
Business College.
ALLEN P. MARTINDALE, age 69, has been a director since the formation of the
Company. Since 1988, Mr. Martindale has served as the President of A.P.M.
Associates (a management consulting firm). Mr. Martindale has served as a
director of Smith's Food and Drug Center, Inc. (a retail food and drug store)
since 1970 and has served such company in several senior executive capacities
since that date, including as Chairman of the Board of Directors and Chief
Executive Officer. He also served as President and Chief Executive Officer of
Arden-Mayfair from 1964 to 1970. Mr. Martindale is a certified public accountant
and a graduate of the University of California at Los Angeles.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RE-ELECTION OF
MESSRS. KING AND MARTINDALE AS CLASS II DIRECTORS OF THE COMPANY.
The following information is furnished regarding the nominee who will be
elected as a Class II director by the holders of the Price Group Stock at the
Annual Meeting.
SAM W. SOUVALL, age 80, has been a director since the formation of the
Company. Since 1979, Mr. Souvall has been Chairman of the Board of Alta
Industries--Utah, Inc. From 1972 to 1984, Mr. Souvall served as a director of
Valley Bank & Trust Company and as the Chairman of its Board of Directors from
1984 to 1988. Mr. Souvall also served as Chairman of the Board of Directors of
Utah Bancorporation from 1980 to 1988 and as President and Chief Executive
Officer of Souvall Bros. Intermountain Wholesalers from 1946 to 1969.
CONTINUING CLASS I DIRECTORS
The following information is furnished regarding the Class I directors (who
will continue to serve on the Board of Directors until the 2003 Annual Meeting
of Stockholders or until their respective successors are elected and qualified).
G. REX FRAZIER, age 57, has served as President, Chief Operating Officer and
a director of the Company since September 1993. From 1986 to 1994, Mr. Frazier
served as President and Chief Operating Officer of Fairfax, prior to which he
had served as Executive Vice President, Vice President--Finance and Director of
Finance. Mr. Frazier has been involved in the real estate industry since 1976.
He is a certified public accountant and, prior to joining Fairfax, worked as an
audit supervisor with Touche Ross & Company. Mr. Frazier is a graduate of the
University of Utah.
3
A. BLAINE HUNTSMAN, age 64, has been a director of the Company since 2000.
Since 1995, Mr. Huntsman has been a principal at Teton Creek Management Company
(an investment management company). From 1988 to 1995, Mr. Huntsman served as
Chairman of the Board and Chief Executive Officer of Olympus Capital Corporation
(a holding company for Olympus Bank). Mr. Huntsman is a member of the Board of
Trustees of The Achievement Funds Trust, which oversees a family of mutual
funds. Mr. Huntsman has also served on the Board of Directors of Zions
Cooperative Mercantile Institution (from 1977 to 1999), Geneva Steel (from 1988
to 1996), Dean Witter Reynolds, Inc. (from 1978 to 1982), Kahler Realty
Corporation (from 1994 to 1996) and Arcata Corporation (from 1978 to 1982). From
1975 to 1980, Mr. Huntsman was Dean of the Graduate School of Business and
College of Business at the University of Utah and from 1969 to 1997 was a
Professor of Finance at the David Eccles School of Business at the University of
Utah. Mr. Huntsman received a bachelor's degree from University of Utah and a
doctorate degree in economics from the University of Pennsylvania.
CONTINUING CLASS III DIRECTORS
The following information is furnished regarding the Class III directors
(who will continue to serve on the Board of Directors until the 2002 Annual
Meeting of Stockholders or until their respective successors are elected and
qualified).
JOHN PRICE, age 67, has served as Chairman of the Board of Directors and
Chief Executive Officer of the Company since September 1993. Mr. Price formed
Fairfax in 1972 and its predecessor, John Price Associates, Inc., a construction
company, in 1957. Mr. Price has developed and built substantial retail and
commercial real estate properties during his 43 years in the real estate
industry and has been involved in all facets of real estate development,
construction, leasing, management and financing. Mr. Price is a member of the
Board of Directors and the Executive Committee of Alta Industries--Utah, Inc.
Mr. Price is also a former member of the NAREIT Board of Governors, a member of
the NAREIT Legislative Advisory Council, a former trustee of the University of
Utah, a member of the Board of Trustees of the Salt Lake Organizing Committee
for the 2002 Winter Olympic Games and a member of the Wells Fargo Salt Lake
Community Advisory Board. Mr. Price is a graduate of the University of Utah.
JAMES A. ANDERSON, age 65, has been a director since the formation of the
Company. From 1978 to 1993, Mr. Anderson was the Chairman of the Board of
Directors of the State of California Mining and Geology Board. He also was the
Executive Vice President of Fulcrum Management, Inc. (a public and private
natural resource venture capital investment company) from 1987 to 1991, and was
a director of Venture Trident Ltd. Partnership (the parent company of Fulcrum
Management, Inc.). He also served as a director of Homestake Mining Company from
1980 to 1987 and as Executive Vice President from 1979 to 1987. Mr. Anderson
received his bachelor's degree in geological engineering from the University of
Utah, a master's degree in mining geology and a doctorate degree in economic
geology from Harvard University and a degree in business administration from the
Stanford University Executive Program.
Vacancies occurring on the Board of Directors as a result of the removal of
a director (i) for cause may be filled by either the stockholders of the Company
or a majority of the remaining directors or (ii) for any other cause, including
an increase in the size of the Board of Directors, may be filled by a majority
of the remaining directors. Vacancies occurring on the Board of Directors as a
result of the death, resignation, removal or retirement of a director elected by
the holders of Price Group Stock shall be filled by holders representing a
majority of the outstanding shares of Price Group Stock. In addition, any change
in the size of the Board of Directors must be approved by holders representing a
majority of the outstanding shares of Price Group Stock.
There is no familial relationship among any of the members of the Board of
Directors or executive officers of the Company.
4
2. RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed PricewaterhouseCoopers LLP as the
independent auditors to examine the accounts of the Company for the 2001
calendar year. PricewaterhouseCoopers LLP and its predecessor, Price Waterhouse
LLP, have served as the Company's independent auditors since the Company was
formed. In the event that ratification of this appointment of auditors is not
approved by the affirmative vote of a majority of the shares of Common Stock and
the Price Group Stock, voting together as a single class, the Board of Directors
will review its future selection of auditors.
Representatives of PricewaterhouseCoopers LLP are expected to be present at
the Annual Meeting and will be provided with an opportunity to make a statement
if so desired and to respond to appropriate inquiries from stockholders.
AUDIT FEES
PricewaterhouseCoopers LLP billed the Company an aggregate of $100,000 in
fees for professional services rendered for the audit of the Company's annual
financial statements for the year ended December 31, 2000 and for the review of
the financial statements included in the Company's Quarterly Reports on
Form 10-Q filed with the Securities and Exchange Commission (the "Commission")
during 2000.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
PricewaterhouseCoopers LLP did not perform any financial information systems
design or implementation services for the Company during the year ended
December 31, 2000. Accordingly, no fees were paid to PricewaterhouseCoopers LLP
during 2000 for these types of services.
ALL OTHER FEES
PricewaterhouseCoopers LLP billed the Company an aggregate of $65,831 in
fees for all other services rendered during the year ended December 31, 2000.
The Audit Committee of the Company has considered whether the provision of these
services by PricewaterhouseCoopers LLP is compatible with maintaining the
auditor's independence.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY'S INDEPENDENT AUDITORS
FOR 2001.
5
BOARD OF DIRECTORS, COMMITTEE MEETINGS, AUDIT
COMMITTEE REPORT AND COMPENSATION OF DIRECTORS
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the fiscal year ended December 31, 2000, the Board of Directors held
four meetings. Each of the Company's directors attended at least 75% of the
board meetings and assigned committee meetings held in 2000.
The Board of Directors has three standing committees: the Executive
Committee, the Audit Committee and the Executive Compensation Committee. The
Company does not have a standing nominating committee; the usual functions of
such committee are performed by the entire Board of Directors.
EXECUTIVE COMMITTEE. John Price (Chairman), G. Rex Frazier and Warren P.
King are members of the Executive Committee. This committee, which met 32 times
in 2000, has the authority to acquire, dispose of and finance investments for
the Company, to authorize the execution of contracts and agreements, including
those related to the borrowing of money by the Company and, generally, to
exercise all other powers of the Board of Directors, except as may otherwise be
prohibited by the Company's Amended and Restated Articles of Incorporation or by
law.
EXECUTIVE COMPENSATION COMMITTEE. Warren P. King (Chairman), James A.
Anderson and Sam W. Souvall are members of the Executive Compensation Committee.
This committee, which met once in 2000, determines compensation for the
Company's executive officers and administers and reviews the Company's 1993
Stock Option Plan.
AUDIT COMMITTEE. Warren P. King (Chairman), Allen P. Martindale and Sam W.
Souvall are members of the Audit Committee. This committee, which met four times
in 2000, makes recommendations concerning the engagement of independent
auditors, reviews with the independent auditors the plans and results of the
audit engagement, approves professional services provided by the independent
auditors, reviews the independence of the auditors, considers the range of audit
and non-audit fees and reviews the adequacy of the Company's internal accounting
controls.
AUDIT COMMITTEE REPORT
The Audit Committee of the Board of Directors is comprised of three
independent directors, as required by the rules and listing standards of the New
York Stock Exchange. The Audit Committee operates under a written charter
adopted by the Board of Directors, which is attached as EXHIBIT A to this Proxy
Statement, and is responsible for overseeing the Company's financial reporting
process on behalf of the Board of Directors. Each year, the Audit Committee
recommends to the Board of Directors, subject to stockholder ratification, the
selection of the Company's independent auditors.
Management is responsible for the Company's financial statements and the
financial reporting process, including internal controls. The independent
auditors are responsible for performing an independent audit of the Company's
consolidated financial statements in accordance with generally accepted auditing
standards and for issuing a report thereon. The Audit Committee's responsibility
is to monitor and oversee these processes.
In this context, the Audit Committee has met and held discussions with
management and PricewaterhouseCoopers LLP, the Company's independent auditors.
Management represented to the Audit Committee that the Company's consolidated
financial statements were prepared in accordance with
6
generally accepted accounting principles. The Audit Committee has reviewed and
discussed the consolidated financial statements with management and
PricewaterhouseCoopers LLP. The Audit Committee has also discussed with
PricewaterhouseCoopers LLP the matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees), which included
a discussion of PricewaterhouseCoopers LLP's judgments about the quality (not
just the acceptability) of the Company's accounting principles as applied to
financial reporting.
PricewaterhouseCoopers LLP has provided the Audit Committee with the written
disclosures and letter required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees) and the Audit Committee has
held discussions with PricewaterhouseCoopers LLP regarding such auditor's
independence. The Audit Committee has further considered whether the provision
by PricewaterhouseCoopers LLP of the non-audit services to the Company
referenced elsewhere in this Proxy Statement is compatible with maintaining such
auditor's independence.
Based upon the Audit Committee's discussions with management and
PricewaterhouseCoopers LLP and the Audit Committee's review of the
representations of management and the disclosures by PricewaterhouseCoopers LLP
to the Audit Committee, the Audit Committee recommended to the Board of
Directors that the Company's audited consolidated financial statements be
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 2000 for filing with the Commission. The Audit Committee and the
Board of Directors have also recommended the selection of PricewaterhouseCoopers
LLP as the Company's independent auditors for 2001, subject to stockholder
ratification.
Audit Committee
WARREN P. KING, CHAIRMAN
ALLEN P. MARTINDALE
SAM W. SOUVALL
COMPENSATION OF DIRECTORS
The Company pays an annual fee of $18,000 to its non-employee directors.
Directors who are employees of the Company are not paid a director fee. The
Company reimburses directors for travel expenses incurred in connection with
their activities on behalf of the Company. In addition, on the date of each
Annual Meeting of the Company's stockholders, each non-employee director then in
office receives an annual grant of options to purchase 1,000 shares of Common
Stock at the then current market price. Additionally, each non-employee director
is granted options to purchase 10,000 shares of Common Stock at the then current
market price upon becoming a member of the Executive Committee and options to
purchase an additional 2,000 shares at the then current market price on the date
of each Annual Meeting of the Company's stockholders thereafter that such
non-employee director continues to be a member of the Executive Committee.
7
EXECUTIVE COMPENSATION
SUMMARY OF EXECUTIVE COMPENSATION
The following table sets forth certain information concerning the
compensation paid by the Company to its Chief Executive Officer and Chairman of
the Board of Directors and to its President and Chief Operating Officer, Vice
President and General Counsel, Vice President--Chief Financial Officer and
Treasurer and Vice President--Chief Investment Officer and Secretary, which are
the Company's four most highly compensated executive officers other than the
Chief Executive Officer (together with the Chief Executive Officer, the "Named
Executive Officers").
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION AWARDS
ANNUAL COMPENSATION ---------------------
----------------------- SECURITIES ALL OTHER
NAME AND PRINCIPAL POSITIONS YEAR SALARY($) BONUS($)(1) UNDERLYING OPTIONS(#) COMPENSATION($)
- ---------------------------- -------- --------- ----------- --------------------- ---------------
John Price(2) 2000 $142,360 $42,000 -- $9,099(3)
Chairman of the Board and 1999 136,360 70,350 9,000 8,844(4)
Chief Executive Officer 1998 130,000 78,000 12,500 7,077(5)
G. Rex Frazier 2000 $152,360 $45,000 -- $8,643(3)
President and Chief 1999 146,360 75,600 9,000 7,861(4)
Operating Officer 1998 142,360 84,000 12,500 7,585(5)
David R. Sabey 2000 $115,860 $14,982 -- $7,299(3)
Vice President and General 1999 112,360 25,410 6,000 6,428(4)
Counsel 1998 108,860 31,631 5,000 6,168(5)
M. Scott Collins 2000 $108,360 $21,200 -- $7,073(3)
Vice President--Chief 1999 104,360 35,700 6,000 6,080(4)
Financial Officer and 1998 101,360 44,550 25,000 5,834(5)
Treasurer
Paul K. Mendenhall 2000 $ 94,860 $18,600 -- $6,741(3)
Vice President--Chief 1999 91,360 31,150 5,000 5,969(4)
Investment Officer and 1998 88,360 38,700 10,000 5,723(5)
Secretary
- ------------------------
(1) Bonuses received for 1998, 1999 and 2000 were paid in February of 1999, 2000
and 2001, respectively.
(2) Mr. Price receives a minimum of $100,000 in annual compensation and
participates in other standard benefit programs available to senior
executives generally pursuant to a year-to-year employment and
non-competition agreement that was entered into on January 21, 1994, the
closing date of the Company's initial public offering.
8
(3) Amounts received in 2000 for each of the Named Executive Officers are as
follows:
HEALTH LIFE RETIREMENT
INSURANCE INSURANCE 401(K) PLAN PLAN TOTAL
--------- --------- ------------ ---------- --------
John Price.................. $2,763 $1,143 $1,000 $4,193 $9,099
G. Rex Frazier.............. 2,763 387 1,000 4,493 8,643
David R. Sabey.............. 2,763 135 1,000 3,401 7,299
M. Scott Collins............ 2,763 135 1,000 3,175 7,073
Paul K. Mendenhall.......... 2,763 207 1,000 2,771 6,741
(4) Amounts received in 1999 for each of the Named Executive Officers are as
follows:
HEALTH LIFE RETIREMENT
INSURANCE INSURANCE 401(K) PLAN PLAN TOTAL
--------- --------- ------------ ---------- --------
John Price.................. $1,870 $1,890 $1,000 $4,084 $8,844
G. Rex Frazier.............. 1,870 675 1,000 4,316 7,861
David R. Sabey.............. 1,870 261 1,000 3,297 6,428
M. Scott Collins............ 1,870 153 1,000 3,057 6,080
Paul K. Mendenhall.......... 1,870 432 1,000 2,667 5,969
(5) Amounts received in 1998 for each of the Named Executive Officers are as
follows:
HEALTH LIFE RETIREMENT
INSURANCE INSURANCE 401(K) PLAN PLAN TOTAL
--------- --------- ------------ ---------- --------
John Price.................. $1,715 $1,890 $1,000 $2,472 $7,077
G. Rex Frazier.............. 1,715 675 1,000 4,194 7,585
David R. Sabey.............. 1,715 261 1,000 3,192 6,168
M. Scott Collins............ 1,715 153 1,000 2,966 5,834
Paul K. Mendenhall.......... 1,715 432 1,000 2,577 5,723
OPTION GRANTS FOR CALENDAR YEAR 2000
No options were granted to any of the Named Executive Officers during 2000.
OPTION EXERCISES/VALUES OF UNEXERCISED OPTIONS
The following table sets forth as to each of the Named Executive Officers
information with respect to option exercises during 2000 and unexercised options
on December 31, 2000.
9
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES(1)
NUMBER OF SECURITIES VALUE OF UNEXERCISED IN-
UNDERLYING UNEXERCISED THE-MONEY OPTIONS AT
SHARES OPTIONS AT FISCAL YEAR-END(#) FISCAL YEAR-END($)(2)
ACQUIRED ON VALUE --------------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ----------- ------------ -------------- ----------- -------------
John Price................... -- -- 220,000 13,500 $0 $0
G. Rex Frazier............... -- -- 63,515 16,000 0 0
David R. Sabey............... -- -- 27,100 8,000 0 0
M. Scott Collins............. -- -- 12,000 19,000 0 0
Paul K. Mendenhall........... -- -- 42,810 11,333 0 0
- ------------------------
(1) No stock appreciation rights are held by any of the Named Executive
Officers.
(2) In accordance with the rules of the Commission, values are calculated by
subtracting the exercise price of an option from the fair market value of
the underlying common stock. At December 31, 2000, the exercise prices of
all outstanding options ranged from $17.50 to $25.38. For purposes of this
table, fair market value of the Company's Common Stock is deemed to be
$15.75, the closing price of the Common Stock reported on the New York Stock
Exchange on December 31, 2000.
REPORT ON EXECUTIVE COMPENSATION
This report is presented to describe the compensation policies applied by
the Executive Compensation Committee of the Board of Directors with regard to
the Company's executive officers and the basis for the compensation of John
Price, Chief Executive Officer of the Company, for the year 2000.
COMPENSATION PHILOSOPHY. The Company's compensation program for executive
officers is based upon a desire to achieve both its short-term and long-term
business goals and strategies with a view to enhancing stockholder value. To
achieve its goals, the Company recognizes that it must adopt a compensation
program that will attract, retain and motivate qualified and experienced
executive officers and that its compensation program should align the financial
interests of its executive officers with those of its stockholders.
COMPENSATION OF EXECUTIVE OFFICERS (OTHER THAN THE CHIEF EXECUTIVE
OFFICER). Each year, the Executive Compensation Committee reviews the
compensation of each executive officer of the Company for the previous year. In
approving the 2000 annual salary for each of the executive officers, the
Executive Compensation Committee considered several factors, including the
individual's salary for the previous year, the individual's anticipated bonus
(if any) for the previous year, the scope of the individual's responsibilities,
the recommendations of management as to salary and bonus formula for the
subsequent year, the Company's historical financial results and the Company's
anticipated financial performance. The compensation determination for each
individual was largely subjective and no specific weight was given to any
particular factor. In addition to their base salaries, the executive officers of
the Company are eligible to participate in the Management Incentive Compensation
Plan described below and to receive discretionary bonuses tied to their
individual performances and the overall performance of the Company.
COMPENSATION OF CHIEF EXECUTIVE OFFICER. The Executive Compensation
Committee determined the 2000 annual salary for John Price, Chief Executive
Officer of the Company, based upon a number of factors and criteria, including
the Company's historical financial results, the Company's anticipated financial
performance and the requirements of Mr. Price. As Chief Executive Officer,
Mr. Price is also eligible to participate in the Management Incentive
Compensation Plan described below and to receive discretionary bonuses tied to
his individual performance and the overall performance of the Company.
10
1993 STOCK OPTION PLAN. The Company believes that providing executive
officers with opportunities to acquire significant equity stakes in its growth
and prosperity through the grant of stock options will enable the Company to
attract and retain qualified and experienced executive officers. Stock options
represent a valuable portion of the compensation program for the Company's
executive officers. Stock options are generally awarded to executive officers at
the time that they join the Company and periodically thereafter. The exercise
price of stock options has thus been tied to the market value of the Company's
Common Stock on the date of the grant and will have value only if the market
value of the Common Stock increases. The size of the initial grants of stock
options made to the existing executive officers (other than M. Scott Collins)
was determined in connection with the formation of the Company. As of
December 31, 2000, there have been only three additional grants of stock options
to executive officers under the plan since the formation of the Company. Future
grants of stock options to executive officers will generally be made by the
Executive Compensation Committee upon the recommendation of management and will
be based upon the level of each executive officer's position in the Company, an
evaluation of the executive officer's past and expected future performance, the
number of outstanding and previously granted options and discussions with the
executive officer.
MANAGEMENT INCENTIVE COMPENSATION PLAN. The Company established an
incentive compensation plan for its executive officers beginning in 1995. The
plan provides that each executive officer will earn a cash bonus for a
particular calendar year equal to a percentage of such executive officer's
annual base salary provided that the Company's funds from operations per share
of Common Stock increase at specified levels as compared to the previous year.
The Executive Compensation Committee will review this plan at the end of each
fiscal year to determine if it should be retained or revised to take into
consideration future developments.
Executive Compensation Committee
WARREN P. KING, CHAIRMAN
JAMES A. ANDERSON
SAM W. SOUVALL
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
John Price, Chief Executive Officer of the Company, is a director of Alta
Industries--Utah, Inc. and, during 2000, Warren P. King, a director of the
Company and the Chairman of the Executive Compensation Committee of the
Company's Board of Directors, was the President and Chief Executive Officer of
Alta Industries--Utah, Inc.
11
SHARE PERFORMANCE GRAPH
The graph and table set forth below compare the cumulative total stockholder
return on the Company's Common Stock, for the period of December 31, 1995
through December 31, 2000, with the NAREIT Equity Retail REIT Total Return
Index, the NAREIT Equity Mall REIT Total Return Index and the S&P 500 Index for
the same period. The graph and table assume an investment of $100 in the Common
Stock and each index on or about December 31, 1995 and the reinvestment of all
dividends.
[SHARE PERFORMANCE GRAPH APPEARS HERE]
DEC. 31, DEC. 31, DEC. 31, DEC. 31, DEC. 31, DEC. 31,
1995 1996 1997 1998 1999 2000
--------- --------- --------- --------- --------- ---------
Equity Related REIT......................... 100.00 134.60 157.41 149.64 132.02 155.74
Equity Mall REIT............................ 100.00 145.27 165.16 160.83 137.39 169.68
S&P 500..................................... 100.00 122.96 163.99 210.86 255.20 231.96
JP Realty, Inc.............................. 100.00 127.58 137.02 112.66 99.52 111.90
There can be no assurance that the Company's share performance will continue
into the future with trends the same or similar to those depicted in the graph
above. The Company will not make or endorse any predictions as to future share
performance.
The foregoing Audit Committee Report, Report on Executive Compensation and
Share Performance Graph shall not be deemed incorporated by reference by any
general statement incorporating by reference this Proxy Statement into any
filing under the Securities Act of 1933, as amended, or the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), except to the extent that the
Company specifically incorporates such reports or graph by reference and shall
not otherwise be deemed filed under such acts.
12
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and holders of more than 10% of the outstanding shares of
Common Stock ("10% Stockholders") to file with the Commission and the New York
Stock Exchange initial reports of ownership and reports of changes in ownership
of Common Stock and other equity securities of the Company. Directors, executive
officers and 10% Stockholders are required by the Commission's regulations to
furnish the Company with copies of all Section 16(a) forms and amendments
thereto filed during any given year.
Based on review of the copies of such reports and amendments thereto
furnished to the Company and representations from the Company's directors,
executive officers and 10% Stockholders that no other reports were required to
be filed, the Company believes that for the year ended December 31, 2000 the
Company's directors, executive officers and 10% Stockholders complied with all
Section 16(a) filing requirements applicable to them, except that A. Blaine
Huntsman, a director, failed to accurately disclose the entire amount of his
holdings of Common Stock in his initial report of ownership which was filed upon
his becoming a director of the Company on May 3, 2000.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
MANAGEMENT CONTRACTS
The Company provided third-party management services for certain properties
owned directly or indirectly by John Price, Chairman of the Board of Directors
and Chief Executive Officer of the Company, as follows: (i) an office building
located in Salt Lake City, Utah, the owner of which paid the Company a
management fee of $118,000, $113,000 and $115,000 in 2000, 1999 and 1998,
respectively (Fairfax, a company which is wholly-owned by Mr. Price, is a
general partner of the owner of this building); (ii) five commercial buildings
located in Albuquerque, New Mexico, Creve Coeur, Missouri, Dallas, Texas,
Escondido, California and Houston, Texas, respectively, the owner of which paid
the Company a management fee of $20,000, $6,000 and $5,000 in 2000, 1999 and
1998, respectively (Mr. Price is the general partner of the owner of these
buildings); and (iii) an office building located in Park City, Utah, the owner
of which paid the Company a management fee of $2,000 in 2000. (Mr. Price is a
general partner of the owner of this building).
COMPUTER SERVICES
The Company contracts for computer services from Alta Computer
Services, Inc. ("Alta Computer"). Alta Computer is majority owned by John Price,
Chairman of the Board of Directors and Chief Executive Officer of the Company,
Warren P. King, a director of the Company, and Sam W. Souvall, a director of the
Company. The Company paid $154,000, $192,000 and $175,000 in 2000, 1999 and
1998, respectively, for such services.
ACCOUNTING AND MANAGEMENT SERVICES
The Company has entered into a management agreement under which it performs
certain accounting and management functions on behalf of Fairfax. Management
fees collected by the Company under this agreement totaled $72,000 for each of
the three years ended December 31, 2000.
13
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth certain information as of the Record Date
regarding the beneficial ownership of the Company's Common Stock and Price Group
Stock with respect to (i) each person known to the Company to be the beneficial
owner of 5% or more of the Company's outstanding shares of Common Stock and
Price Group Stock; (ii) the Named Executive Officers; (iii) the Company's
directors and nominees for director; and (iv) all directors and executive
officers of the Company as a group.
BENEFICIAL OWNERSHIP TABLE(1)
NAME AND BUSINESS ADDRESS SHARES BENEFICIALLY PERCENT OF
OF BENEFICIAL OWNER(2) OWNED SHARES
- ------------------------- ------------------- ----------
John Price(3)............................................... 3,279,468 17.08%
Warren P. King(4)........................................... 204,982 1.25
G. Rex Frazier(5)........................................... 109,365 *
Paul K. Mendenhall(6)....................................... 55,964 *
Sam W. Souvall(7)........................................... 54,351 *
David R. Sabey(8)........................................... 33,061 *
Allen P. Martindale(9)...................................... 31,000 *
A. Blaine Huntsman(10)...................................... 21,000 *
M. Scott Collins(11)........................................ 19,000 *
James A. Anderson(12)....................................... 12,000 *
All Directors and Executive Officers of the Company as a
Group (13 Persons).......................................... 3,928,255 19.90
Fairfax Realty, Inc.(13)
35 Century Park-Way
Salt Lake City, Utah 84115.................................. 2,967,313 15.67
Fairfax Holding, L.L.C.(14)
35 Century Park-Way
Salt Lake City, Utah 84115.................................. 2,967,313 15.67
AXA Financial, Inc.(15)
1290 Avenue of the Americas
New York, New York 10104.................................... 1,437,533 8.86
T. Rowe Price Associates, Inc.(16)
100 E. Pratt Street
Baltimore, Maryland 21202................................... 1,192,900 7.35
Grantham, Mayo, Van Otterloo & Co., LLC(17)
40 Rowes Wharf
Boston, Massachusetts 02110................................. 1,174,600 7.24
- ------------------------
* An asterisk indicates ownership of less than 1%.
(1) For purposes of this table, a person is deemed to be the beneficial owner of
shares of Common Stock if that person has the right to acquire such shares
within 60 days of the Record Date by the exercise of any stock option or any
other right to convert or exchange outstanding securities. The Company is
the sole general partner of, and owns an 81.7% interest in, the Operating
Partnership. Units of limited
14
partner interests in the Operating Partnership (the "OP Units") are
exchangeable, at the option of the holders thereof, for shares of Common
Stock on a one-for-one basis (subject to adjustment in the event of stock
splits, dividends, combinations or reclassifications). OP Units and stock
options held by a person are deemed to have been exchanged or exercised for
the purpose of computing the percentage of outstanding shares of Common
Stock beneficially owned by such person, but shall not be deemed to have
been exchanged or exercised for the purpose of computing the percentage of
outstanding shares of Common Stock beneficially owned by any other person.
The Company has the right to convert any outstanding shares of Price Group
Stock on a one-for-one basis into shares of Common Stock in the event that
the combined direct or indirect economic interest held by the Price Group in
the Operating Partnership falls below 10%. Even though such economic
interest held by the Price Group is not below the 10% level, for purposes of
this table, shares of Price Group Stock are deemed to be converted into an
equivalent number of shares of Common Stock. Additionally, for the purposes
of this table, a person or entity shall be deemed to be a beneficial owner
of shares of Common Stock if such person or entity has or shares either
investment or voting power with respect to such shares.
(2) The business address of each officer and/or director of the Company named
herein is JP Realty, Inc., 35 Century Park-Way, Salt Lake City, Utah 84115.
(3) Includes (i) 13,841 OP Units held by Mr. Price, (ii) 2,713,313 OP Units,
54,000 shares of Common Stock and 200,000 shares of Price Group Stock held
by Fairfax Holding, L.L.C., a limited liability company in which Mr. Price
holds an approximate 85% direct and indirect interest ("Holding"),
(iii) 27,814 OP Units held by JPET II, and (iv) options to purchase 225,500
shares of Common Stock. Mr. Price, through his control of Holding and JPET
II, exercises sole investment and voting power over the OP Units, shares of
Common Stock and shares of Price Group Stock held by such entities and
disclaims beneficial ownership of the OP Units, shares of Common Stock and
shares of Price Group Stock held by Holding and JPET II, except to the
extent of his approximate 85% interest in Holding and his approximate 1%
interest in JPET II.
(4) Includes (i) 80,952 OP Units held by Mr. King, (ii) 16,008 OP Units held by
Mr. King's wife, Florence K. King, (iii) 42,022 OP Units held by certain
partnerships in which Mr. King holds various interests, and (iv) options to
purchase 36,000 shares of Common Stock.
(5) Includes (i) 31,831 OP Units and (ii) options to purchase 71,515 shares of
Common Stock.
(6) Includes (i) 7,187 OP Units and (ii) options to purchase 48,447 shares of
Common Stock.
(7) Includes (i) 23,371 OP Units held by S.W. Souvall Trust and (ii) options to
purchase 12,000 shares of Common Stock. Of the shares of Common Stock
reported in the table, 2,300 shares are owned of record by S.W. Souvall Co.,
a partnership in which Mr. Souvall and his wife each hold 2% general partner
interests, and 2,300 shares are owned of record by Sary Enterprises, a
partnership of which Mr. Souvall and his wife are 11% and 3% owners,
respectively. Mr. Souvall disclaims beneficial ownership of the shares of
Common Stock held by S.W. Souvall Co. and Sary Enterprises, except to the
extent of Mr. and Mrs. Souvall's ownership interests therein.
(8) Includes (i) 1,595 OP Units and (ii) options to purchase 31,100 shares of
Common Stock.
(9) Includes options to purchase 4,000 shares of Common Stock.
(10) Includes (i) 20,000 shares of Common Stock held by certain retirement plans
beneficially owned by Mr. Huntsman and (ii) options to purchase 1,000 shares
of Common Stock.
(11) Includes options to purchase 19,000 shares of Common Stock.
(12) Includes options to purchase 12,000 shares of Common Stock.
15
(13) Includes 2,713,313 OP Units, 54,000 shares of Common Stock and 200,000
shares of Price Group Stock held by Holding. Fairfax exercises shared
investment and voting power with respect to the OP Units, shares of Common
Stock and shares of Price Group Stock held by Holding and disclaims
beneficial ownership of such OP Units, shares of Common Stock and shares of
Price Group Stock, except to the extent of its approximate 44% interest in
Holding. All securities beneficially owned by Fairfax are additionally
identified as being beneficially owned by Mr. Price and Holding.
(14) Includes 2,713,313 OP Units, 54,000 shares of Common Stock and 200,000
shares of Price Group Stock. All securities beneficially owned by Holding
are additionally identified as being beneficially owned by Mr. Price and
Fairfax.
(15) On its Schedule 13G/A filed with the Commission on February 12, 2001, AXA
Financial, Inc., AXA Conseil Vie Assurance Mutuelle, AXA Assurances I.A.R.D.
Mutuelle, AXA Assurances Vie Mutuelle, AXA Courtage Assurance Mutuelle and
AXA reported sole voting power with respect to 481,591 shares of Common
Stock beneficially owned by them, shared voting power with respect to
950,619 shares of Common Stock beneficially owned by them, sole dispositive
power with respect to 1,435,114 shares of Common Stock beneficially owned by
them and shared dispositive power with respect to 2,419 shares of Common
Stock beneficially owned by them.
(16) On its Schedule 13G filed with the Commission on February 14, 2001, T. Rowe
Price Associates, Inc. reported sole voting power with respect to 351,300
shares of Common stock beneficially owned by them and sole dispostive power
with respect to 1,192,900 shares of Common Stock beneficially owned by them.
(17) On its Schedule 13G filed with the Commission on February 2, 2001,
Grantham, Mayo, Van Otterloo & Co., LLC reported sole voting power with
respect to 1,174,600 shares of Common Stock beneficially owned by them.
OTHER MATTERS
The Board of Directors knows of no other business that will be presented at
the Annual Meeting. If any other business is properly brought before the Annual
Meeting, it is intended that Proxies in the enclosed form will be voted in
respect thereof in accordance with the judgments of the persons voting the
Proxies.
MISCELLANEOUS
The cost of soliciting Proxies will be borne by the Company. This
solicitation is being made by mail, but may also be made by officers, directors
and regular employees of the Company by telephone, telegraph, facsimile
transmission, electronic transmission, mail or personal interview. No additional
compensation will be given to officers, directors or employees for such
solicitation. The Company will request brokers and nominees who hold shares of
Common Stock in their names to furnish proxy material to beneficial owners of
such shares and will reimburse such brokers and nominees for their reasonable
expenses incurred in forwarding solicitation material to such beneficial owners.
STOCKHOLDERS' PROPOSALS
Any stockholder who intends to submit a proposal at the 2002 Annual Meeting
of Stockholders and who wishes to have the proposal considered for inclusion in
the proxy statement and proxy card must, in addition to complying with the
applicable laws and regulations governing submissions of such proposals, deliver
the proposal to the Company no later than December 3, 2001.
16
Pursuant to the Company's By-Laws, any stockholder who intends to submit a
proposal for presentation at an annual meeting of stockholders, without having
such proposal included in the proxy statement for such annual meeting, must
notify the Company not more than 120 days and not less than 90 days prior to the
earliest of (i) such annual meeting, (ii) the first anniversary of the mailing
date of the notice of the preceding year's annual meeting or (iii) the first
anniversary of the preceding year's annual meeting. Accordingly, any stockholder
who intends to submit such a proposal at the 2002 Annual Meeting of Stockholders
must notify the Company of such proposal by January 2, 2002, but in no event
earlier than December 3, 2001.
Such proposals should be sent to Paul K. Mendenhall, Secretary, at JP
Realty, Inc., 35 Century Park-Way, Salt Lake City, Utah 84115.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K (FILED WITH THE
COMMISSION AND THE NEW YORK STOCK EXCHANGE), WHICH CONTAINS ADDITIONAL
INFORMATION ABOUT THE COMPANY, IS AVAILABLE WITHOUT CHARGE TO ANY STOCKHOLDER.
REQUESTS SHOULD BE DIRECTED TO PAUL K. MENDENHALL, SECRETARY, AT JP
REALTY, INC., 35 CENTURY PARK-WAY, SALT LAKE CITY, UTAH 84115.
By Order of the Board of Directors,
/s/ Paul K. Mendenhall
Paul K. Mendenhall
Secretary
Salt Lake City, Utah
April 2, 2001
17
EXHIBIT A
JP REALTY, INC.
AUDIT COMMITTEE CHARTER
PURPOSE
The primary purpose of the Audit Committee (the "Committee") is to assist
the Board of Directors (the "Board") in fulfilling its responsibility to oversee
management's conduct of the Company's financial reporting process, including by
overviewing the financial reports and other financial information provided by
the Company to any governmental or regulatory body, the public or other users
thereof, the Company's systems of internal accounting and financial controls,
and the annual independent audit of the Company's financial statements.
In discharging its oversight role, the Committee is empowered to investigate
any matter brought to its attention with full access to all books, records,
facilities and personnel of the Company and the power to retain outside counsel,
auditors or other experts for this purpose. The Board and the Committee are in
place to represent the Company's shareholders; accordingly, the outside auditor
is ultimately accountable to the Board and the Committee.
The Committee shall review the adequacy of this Charter on an annual basis.
MEMBERSHIP
The Committee shall be comprised of not less than three members of the
Board, and the Committee's composition will meet the requirements of the Audit
Committee Policy of the New York Stock Exchange.
Accordingly, all of the members will be directors:
1. Who have no relationship to the Company that may interfere with the
exercise of their independence from management and the Company; and
2. Who are financially literate or who become financially literate within a
reasonable period of time after appointment to the Committee. In
addition, at least one member of the Committee will have accounting or
related financial management expertise.
KEY RESPONSIBILITIES
The Committee's job is one of oversight and it recognizes that the Company's
management is responsible for preparing the Company's financial statements and
that the outside auditors are responsible for auditing those financial
statements. Additionally, the Committee recognizes that financial management, as
well as the outside auditors, have more time, knowledge and more detailed
information on the Company than do Committee members; consequently, in carrying
out its oversight responsibilities, the Committee is not providing any expert or
special assurance as to the Company's financial statements or any professional
certification as to the outside auditor's work.
The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function. These functions are set forth
as a guide with the understanding that the Committee may diverge from this guide
as appropriate given the circumstances.
- The Committee shall review with management and the outside auditors the
audited financial statements to be included in the Company's Annual Report
on Form 10-K (or the Annual Report to
A-1
Shareholders if distributed prior to the filing of Form 10-K) and review
and consider with the outside auditors the matters required to be
discussed by Statement of Auditing Standards ("SAS") No. 61.
- As a whole, or through the Committee chair, the Committee shall review
with the outside auditors the Company's interim financial results to be
included in the Company's quarterly reports to be filed with Securities
and Exchange Commission and the matters required to be discussed by SAS
No. 61; this review will occur prior to the Company's filing of the
Form 10-Q.
- The Committee shall discuss with management and the outside auditors the
quality and adequacy of the Company's internal controls.
- The Committee shall:
- request from the outside auditors annually, a formal written statement
delineating all relationships between the auditor and the Company
consistent with Independence Standards Board Standard No. 1;
- discuss with the outside auditors any such disclosed relationships and
their impact on the outside auditor's independence; and
- recommend that the Board take appropriate action in response to the
outside auditor's report to satisfy itself of the auditor's
independence.
- The Committee, subject to any action that may be taken by the full Board,
shall have the ultimate authority and responsibility to select (or
nominate for shareholder approval), evaluate and, where appropriate,
replace the outside auditor.
A-2
JP REALTY, INC.
PROXY FOR 2001 ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder of JP Realty, Inc., a Maryland corporation
(the "Company"), acting under the laws of the State of Maryland, hereby
constitutes and appoints John Price and G. Rex Frazier, and each of them, the
attorneys and proxies of the undersigned, each with the power of
substitution, to attend and act for the undersigned at the 2001 Annual
Meeting of Stockholders of the Company to be held on May 2, 2001, at 10:00
a.m., MDT, at the University of Utah, Utah Museum of Fine Arts, The Marcia
and John Price Museum Building, 410 Central Campus Drive, Salt Lake City,
Utah 84111, and at any adjournments or postponements thereof, and in
connection therewith to vote all of the shares of the Company's common stock
which the undersigned would be entitled to vote, as follows on the reverse
side of this proxy.
Said attorneys and proxies, and each of them, shall have all the powers
which the undersigned would have if acting in person. The undersigned hereby
revokes any other proxy to vote at such meeting and hereby ratifies and
confirms all that said attorneys and proxies, and each of them, may lawfully
do by virtue hereof. Said proxies, without hereby limiting their general
authority, are specifically authorized to vote in accordance with their best
judgment with respect to all matters incident to the conduct of the meeting,
all matters presented at the meeting but which are not known to the Board of
Directors at the time of the solicitation of this proxy and, with respect to
the election of any person as a Director, if a bona fide nominee for the
office is named in the Proxy Statement and such nominee is unable to serve,
or will not serve, to vote for any other person.
(Continued and to be signed on the reverse side)
FOLD AND DETACH HERE
THIS PROXY CARD IS BEING SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS
FOR USE ONLY AT THE 2001 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON
MAY 2, 2001 AND AT ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.
Please mark your votes as indicated in the example /X/
1. ELECTION OF DIRECTORS:
/ / FOR the election of Warren P. King and Allen P. Martindale as
Class II directors to serve on the Board of Directors until the
2004 Annual Meeting of Stockholders (except as indicated to the
contrary below).
/ / WITHHOLD AUTHORITY to vote for all nominees listed above.
INSTRUCTIONS: To withhold authority for any individual nominee, please vote
FOR above and write such nominee's name in the space provided below.
2. AUDITORS:
Ratification of the appointment of PricewaterhouseCoopers LLP as the
Company's independent auditors for fiscal 2001.
/ / FOR / / AGAINST / / ABSTAIN
Each of the above-named proxies present at said meeting either in person or
by substitute shall have and exercise all of the powers of said proxies
hereunder. This proxy shall be voted in accordance with the choices
specified by the undersigned on this proxy. IF NO INSTRUCTIONS TO THE
CONTRARY ARE INDICATED HEREON, THIS PROXY WILL BE TREATED AS A GRANT OF
AUTHORITY TO VOTE FOR THE ELECTION OF THE CLASS II NOMINEES FOR THE BOARD OF
DIRECTORS NAMED ABOVE AND AS A GRANT OF AUTHORITY TO VOTE FOR THE PROPOSALS
STATED ABOVE AND ON ANY OTHER MATTER TO BE VOTED UPON.
The undersigned acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement relating to the 2001 Annual Meeting of Stockholders.
PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY IN THE POSTAGE PREPAID
ENVELOPE PROVIDED.
Signature(s) Date:
---------------------------------------- --------------------
IMPORTANT: In signing this proxy, please sign your name or names on the
signature line in the same manner as it appears on your stock certificate.
When signing as an attorney, executor, administrator, trustee or guardian,
please give your full title as such. EACH JOINT TENANT SHOULD SIGN
SEPARATELY.
FOLD AND DETACH HERE