UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
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[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Sec. 240.14a-12
PERFORMANCE CAPITAL MANAGEMENT, LLC
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(Name of Registrant as Specified in Its Charter)
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which
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0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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PERFORMANCE CAPITAL MANAGEMENT, LLC
222 South Harbor Blvd., Suite 400
Anaheim, California 92805
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NOTICE OF 2004 ANNUAL MEETING OF MEMBERS
TO BE HELD ON JUNE 14, 2004
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To our Members:
NOTICE IS HEREBY GIVEN that the 2004 Annual Meeting of Members of Performance
Capital Management, LLC, a California limited liability company, will be held on
Monday, June 14, 2004, at 10:00 a.m., local time, at the Double Tree Hotel, 100
City Drive, Orange, California 92868. The purposes of the Annual Meeting are:
1. To elect three Class I directors to serve a two-year term and until
each director's successor has been duly elected and qualified;
2. To ratify the selection of Moore Stephens Wurth Frazer and Torbet,
LLP, as independent auditors for Performance Capital Management, LLC
for the fiscal year ending December 31, 2004; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice. Members of record on the books of Performance Capital
Management, LLC at the close of business on APRIL 16, 2004 will be entitled to
notice of and to vote at the Annual Meeting or any adjournment or postponement
thereof.
ALL MEMBERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON, BUT
EVEN IF YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, YOU ARE REQUESTED TO
MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE IN
THE ENVELOPE PROVIDED TO ENSURE YOUR REPRESENTATION. MEMBERS ATTENDING THE
ANNUAL MEETING MAY VOTE IN PERSON EVEN IF THEY HAVE PREVIOUSLY VOTED BY PROXY.
By Order of the Board of Directors,
/s/ William D. Constantino
William D. Constantino
Chief Officer of Legal Affairs
Anaheim, California
May 3, 2004
[PCMLLC LETTERHEAD]
May 3, 2004
Dear Member:
You are cordially invited to attend the 2004 Annual Meeting of Members of
Performance Capital Management, LLC, which will be held at the Double Tree
Hotel, 100 City Drive, Orange, California 92868, on Monday, June 14, 2004, at
10:00 a.m., local time.
The Notice of the 2004 Annual Meeting of Members and a Proxy Statement,
which describe the formal business to be conducted at the meeting, accompany
this letter. Our 2003 Annual Report is also enclosed for your information.
All Members entitled to vote are invited to attend the Annual Meeting.
However, to ensure your representation at the Annual Meeting, you are urged to
complete, date, sign and return the enclosed Proxy Card (a postage-prepaid
envelope is enclosed for that purpose).
YOUR LLC UNITS CANNOT BE VOTED UNLESS YOU DATE, SIGN AND RETURN THE
ENCLOSED PROXY CARD OR ATTEND THE ANNUAL MEETING IN PERSON. Regardless of the
number of LLC Units you own, your careful consideration of, and vote upon, the
matters before the Members are important.
I look forward very much to seeing you on June 14th.
Sincerely,
PERFORMANCE CAPITAL MANAGEMENT, LLC
/s/ David J. Caldwell
David J. Caldwell
Chief Operations Officer
PERFORMANCE CAPITAL MANAGEMENT, LLC
222 SOUTH HARBOR BLVD., SUITE 400
ANAHEIM, CALIFORNIA 92805
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PROXY STATEMENT
ANNUAL MEETING OF MEMBERS TO BE HELD ON MONDAY, JUNE 14, 2004
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GENERAL
This Proxy Statement is furnished to the Members of Performance Capital
Management, LLC, a California limited liability company, in connection with the
solicitation of proxies by the Board of Directors of Performance Capital
Management, LLC (also referred to as the "Board"). The proxies are to be voted
at the 2004 Annual Meeting of Members of Performance Capital Management, LLC
(the "Annual Meeting") to be held at the Double Tree Hotel, 100 City Drive,
Orange, California 92868, at 10:00 a.m., local time, on Monday, June 14, 2004,
and any adjournment or postponement thereof, for the purposes set forth in the
accompanying Notice. The Board is not aware of any other matters to be presented
at the Annual Meeting. If any other matter should be presented at the Annual
Meeting upon which a vote properly may be taken, LLC Units represented by all
duly executed proxies received by the Board will be voted with respect thereto
in accordance with the best judgment of the persons designated as the proxies.
This Proxy Statement and the accompanying form of Proxy Card have been mailed to
Members on or about May 3, 2004.
Our principal executive offices are located at 222 South Harbor Blvd., Suite
400, Anaheim, California, 92805 and our telephone number is 714.502.3736.
We will pay all costs of solicitation, including the costs of preparing,
assembling, printing and mailing this Proxy Statement, the Proxy Card and any
additional information furnished to Members. No additional compensation will be
paid to directors, officers or other regular employees for their services in
connection with this proxy solicitation.
ANNUAL REPORT
An Annual Report to Members (the "Annual Report"), containing audited financial
statements for the year ended December 31, 2003, accompanies this Proxy
Statement. Members are referred to the Annual Report for financial and other
information about the activities of Performance Capital Management, LLC. The
Annual Report is not incorporated by reference into this Proxy Statement and is
not deemed to be a part hereof.
We will furnish to you any exhibit described in the list accompanying the Annual
Report, upon the payment, in advance, of the specified reasonable fees related
to our furnishing of such exhibit(s). Requests for copies of the Annual Report
and/or exhibit(s) should be directed to Harvey "Bud" Webb, Member Relations, at
Performance Capital Management, LLC's principal address at 222 South Harbor
Blvd., Suite 400, Anaheim, California, 92805 or by calling 714.502.3736. In the
alternative, you may find the exhibits to the Annual Report on the Securities
and Exchange Commission's web-site at www.sec.gov.
RECORD DATE AND VOTING RIGHTS
Only holders of record of our voting LLC Units at the close of business on April
16, 2004 (the "Record Date") will be entitled to notice of, and to vote at, the
Annual Meeting. On the Record Date, we had 547,194 voting LLC Units outstanding.
Each LLC Unit is entitled to one vote at the Annual Meeting.
The following table summarizes the voting requirements for the two proposals:
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PROPOSAL VOTE REQUIRED
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Proposal No. 1: Election of three Class I The affirmative vote of a majority of the LLC Units
directors. held by Members present in person or by proxy at the
meeting.
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Proposal No. 2: Ratification of our Audit The affirmative vote of a majority of the LLC Units
Committee's selection of Moore held by Members present in person or by proxy at the
Stephens Wurth Frazer and Torbet, LLP meeting.
as the company's auditors for fiscal year
ending December 31, 2004.
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QUORUM
Members present in person or by proxy whose aggregate number of voting LLC Units
exceed one-third of our issued and outstanding voting LLC Units constitutes a
quorum for the transaction of business at the Annual Meeting. Abstentions will
be included in determining the presence of a quorum at the Annual Meeting.
However, an abstention will count as a vote AGAINST the proposal.
LIST OF MEMBERS ENTITLED TO VOTE
At least 10 days before the Annual Meeting, our Chief Officer of Legal Affairs
will make a complete list of the Members entitled to vote at the Annual Meeting
arranged in alphabetical order, with the address of and number of LLC Units held
by each Member. The list will be kept on file at the principal offices of
Performance Capital Management, LLC and will be subject to inspection by any
Member at any time during normal business hours. The list will also be present
for inspection at the Annual Meeting.
ATTENDANCE AND VOTING AT THE ANNUAL MEETING
If you own voting LLC Units of record, you may attend the Annual Meeting and
vote in person, regardless of whether you have previously voted on a Proxy Card.
We encourage you to vote your units in advance of the Annual Meeting date, even
if you plan on attending the Annual Meeting. You may change or revoke your proxy
at the Annual Meeting as described below even if you have already voted.
PROXY VOTING PROCEDURES
LLC Units for which Proxy Cards are properly executed and returned will be voted
at the Annual Meeting in accordance with the directions noted thereon or, in the
absence of directions, will be voted "FOR" the election of each of the nominees
to the Board of Directors, and "FOR" the ratification of our Audit Committee's
selection of Moore Stephens Wurth Frazer and Torbet, LLP as the company's
auditors for fiscal year ending December 31, 2004. It is not expected that any
matters other than those referred to in the Notice and this Proxy Statement will
be brought before the Annual Meeting. If, however, other matters are properly
presented, the persons named as proxies will vote in accordance with their
discretion with respect to such matters.
A Proxy Card for voting your LLC Units is included with this Proxy Statement.
YOU MAY VOTE YOUR LLC UNITS BY COMPLETING, SIGNING AND RETURNING THE PROXY CARD
IN THE ENCLOSED ENVELOPE.
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REVOCATION
Any Member holding voting LLC Units of record may revoke a previously granted
proxy at any time before it is voted by delivering to our Chief Officer of Legal
Affairs a written notice of revocation or a duly executed Proxy Card bearing a
later date or by attending the Annual Meeting and voting in person.
DATE AND TIME OF OPENING AND CLOSING OF THE POLLS
The date and time of the opening of the polls for the Annual Meeting shall be
10:00 a.m., local time, on Monday, June 14, 2004. The time of the closing of the
polls for voting shall be announced at the Annual Meeting. No ballot, proxies or
votes, nor any revocations or changes to a vote, shall be accepted after the
closing of the polls unless a court of equity, upon application by a Member,
determines otherwise.
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
Our directors and executive officers do not have any substantial interest in the
matters to be acted upon at the Annual Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
To our knowledge, the following table sets forth information with respect to the
beneficial ownership of our securities as of April 16, 2004 by (i) each person
known by us to beneficially own more than 5% of our voting securities; (ii) each
of our executive officers; (iii) each of our directors; and (iv) all of our
executive officers and directors as a group. Beneficial ownership is determined
in accordance with the rules of the Securities and Exchange Commission and
includes voting or investment power with respect to the securities. Unless
otherwise indicated, the address for those listed below is c/o Performance
Capital Management, LLC, 222 South Harbor Blvd., Suite 400, Anaheim, California
92805. Subject to applicable community property laws, the persons named in the
table have sole voting power with respect to all LLC Units shown as beneficially
owned by them. The number of outstanding LLC Units entitled to vote as of April
16, 2004 was 547,194. Except as noted otherwise, the amounts reflected below are
based upon information provided to us and in filings with the Securities and
Exchange Commission.
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PERCENT OF
NAME OF BENEFICIAL OWNER NUMBER OF UNITS OUTSTANDING
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Larisa Gadd, Co-Chairperson of the Board (1) 4,777 *
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Lester T. Bishop, Co-Chairperson of the Board (2) 398 *
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Larry C. Smith, Director (3) 995 *
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David Barnhizer, Director (4) 1,094 *
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Rodney Woodworth, Director 2,239 *
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Sanford Lakoff, Director (5) 1,593 *
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Donald W. Rutherford, Director 0 *
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David J. Caldwell, Chief Operations Officer 0 *
- -------------------------------------------------------- --------------- ------------
Edward M. Rucker, Accounting Manager 0 *
- -------------------------------------------------------- --------------- ------------
Darren S. Bard, Chief Information Officer 0 *
- -------------------------------------------------------- --------------- ------------
William D. Constantino, Chief Officer of Legal Affairs 0 *
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ALL EXECUTIVE OFFICERS & DIRECTORS AS A GROUP 11,096 2.0%
(11 Persons)
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<FN>
* Less than 1%.
(1) The 4,777 Units are owned by the GADD FAMILY TRUST DTD 5/30/97, of
which Ms. Gadd and her husband are trustees.
(2) The 398 Units are owned jointly by Mr. Bishop and his wife.
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(3) The 995 Units are owned by the TRUST COMPANY OF AMERICA, of which Mr.
Smith is trustee.
(4) The 1,094 Units are owned by RAINDANCE PARTNERSHIP COMPANY, of which
Mr. Barnhizer's wife is Managing Partner and Mr. Barnhizer is
General Counsel.
(5) The 1,593 Units are owned by the LAKOFF FAMILY TRUST 1/13/97, of which
Mr. Lakoff and his wife are trustees.
CHANGES IN CONTROL
No change in control of Performance Capital Management, LLC has occurred since
the beginning of 2003. We are not aware of any arrangement that would upset the
control mechanisms currently in place over the company. Although it is
conceivable that a third party could attempt a hostile takeover of Performance
Capital Management, LLC, we have not received notice of any such effort.
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PROPOSAL NO. 1: ELECTION OF DIRECTORS
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NOMINEES FOR THE BOARD OF DIRECTORS
Our Board of Directors has proposed that three nominees be elected at the Annual
Meeting, each of whom shall hold office for two years, as provided below, and
until his or her successor shall have been elected and qualified. Unless
otherwise instructed, it is the intention of the persons named as proxies on the
accompanying Proxy Card to vote LLC Units represented by properly executed
proxies for the election of such nominees. Although our Board anticipates that
the three nominees will be available to serve as directors of Performance
Capital Management, LLC, if any of them should be unwilling or unable to serve,
it is intended that the proxies will be voted for the election of such
substitute nominee or nominees as may be designated by our Board.
The following persons currently serve and have been nominated to continue to
serve as our directors. If elected, the term of office of these Class I
directors will expire at the second annual meeting of Members after their
election. Absent his or her death, resignation or removal, a director shall
continue to serve despite the expiration of the director's term until his or her
successor is elected and qualified or until there is a decrease in the number of
directors.
The following nominees for the Board of Directors will stand for election at the
2004 Annual Meeting:
Class I Directors:
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- Larisa Gadd
- Rodney Woodworth
- Donald W. Rutherford
Biographical information regarding each of the nominees for the Board of
Directors is set forth below, beginning on page 5.
OUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE ELECTION OF THE CLASS
I DIRECTORS NAMED ABOVE.
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DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the name, age and position of each of our
directors (and nominees for election) and executive officers as of April 16,
2004.
NAME AGE POSITION
---- --- --------
Larisa Gadd 41 Co-Chairperson of the Board / Nominee
Lester T. Bishop 71 Co-Chairperson of the Board
Larry C. Smith 66 Director
David Barnhizer 60 Director
Rodney Woodworth 66 Director / Nominee
Sanford Lakoff 72 Director
Donald W. Rutherford 64 Director / Nominee
David J. Caldwell 50 Chief Operations Officer
Edward M. Rucker 57 Accounting Manager
Darren S. Bard 36 Chief Information Officer
William D. Constantino 53 Chief Officer of Legal Affairs
All of the current directors except Mr. Rutherford were appointed to the Board
of Directors on February 4, 2002. Mr. Rutherford was appointed to the Board of
Directors on January 12, 2004, following the resignation of Mr. Robert Price in
July 2003. Our Operating Agreement currently provides that our two classes of
directors serve staggered two-year terms. All directors hold office until their
respective successors are elected and qualified or until their earlier death,
resignation or removal. Executive officers are duly elected by the Board of
Directors to serve until their respective successors are elected and qualified.
Our officers serve at the discretion of the Board of Directors. There are no
family relationships between or among any of our directors or executive
officers.
The following information with respect to the principal occupation or
employment, other affiliations and business experience during the last five
years of our directors and executive officers has been furnished to us by each
director and executive officer.
LARISA GADD. For the past 16 years, Ms. Gadd has been a business partner at
Scenic Express, Inc., in Los Angeles. Scenic Express fabricates theatrical
scenery for stage and screen. Ms. Gadd is also working on obtaining a doctorate
degree in Natural Health and Healing from Clayton College of Natural Health.
From 1987 to 1988, Ms. Gadd was an instructor at Chaffey College in Alta Loma in
the area of Social Sciences. She received a B.S. degree in Psychology and
English from the California State University, Fullerton in 1984 and a M.A.
degree in Organizational and Applied Social Psychology from Claremont Graduate
School in 1986.
LESTER T. BISHOP. Mr. Bishop has taught kindergarten through 12th grade
students for the past 20 years. At the same time, Mr. Bishop owned solely and in
partnership with others a number of privately held businesses, including Whitiok
Day Camp, Good Time Promotions, Mall Munchies, Park Riviera Motel, and Imperial
Executive Suites. He has also owned and managed both residential and commercial
real estate. Mr. Bishop received a B.A. degree in Education from the University
of California, Los Angeles in 1960 and a M.A. degree from the California State
University, Los Angeles in Educational Administration in 1965 with advanced
credentials in reading, counseling and teacher effectiveness.
LARRY C. SMITH. Mr. Smith retired in 1994. Prior to retirement, from 1987 to
1994, Mr. Smith was Senior Systems Engineering Manager of TRW Space Systems. In
that position, Mr. Smith managed the systems engineering teams in support of
classified satellite space systems development and new satellite system studies.
Mr. Smith is a registered U.S. Patent Agent and holds three patents. Mr. Smith
received a B.S. degree in Engineering from the University of Washington in 1959
and completed four years of graduate studies at the University of California,
Los Angeles in Control Systems and Electronics.
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DAVID BARNHIZER. Mr. Barnhizer is currently Professor of Law at Cleveland State
University College of Law and has held that position since 1972. He teaches or
has taught courses dealing primarily with business and environmental law. From
1997 to 1998, he was a Strategic Consultant to the Government of Mongolia to the
Mongolian Action Programme for the 21st Century. During that same period, he was
also a consultant on sustainable economic development and the creation of a
Central American trade zone to the U.N. Development Program. From 1995 to 1997,
he was a member of the Board of Editors for the Journal of Legal Education. Mr.
Barnhizer has published nine books / manuals and approximately 30 professional
articles. He received a Bachelor of Arts degree from Muskingum College in 1966,
a Juris Doctor degree from Ohio State University College of Law in 1969, and a
Master of Law degree from Harvard Law School in 1972.
RODNEY WOODWORTH. Mr. Woodworth retired in 1998. From 1988 to 1998, Mr.
Woodworth was the Senior Vice President of Operations at Zimmerman Holdings,
Inc., which is in the business of buying troubled manufacturing businesses,
turning them around, growing them and then selling them. Prior to working at
Zimmerman Holdings, Inc., he was the Senior Vice President of Fairchild
Industries and President of its Commercial and Industrial Products Group. Mr.
Woodworth is an alumni of the Stanford Graduate Business School and received a
B.S. degree in Mechanical Engineering from the California State Polytechnical
University, San Luis Obispo in 1960.
SANFORD LAKOFF. Mr. Lakoff is Research Professor of Political Science Emeritus
at the University of California, San Diego. He has taught at UCSD since 1974,
when he was appointed Founding Chair of the Department of Political Science. Mr.
Lakoff has written or edited eleven books and published approximately 50
scholarly articles as well as contributing to entries in the Dictionary of the
History of Ideas, the Encyclopedia of Democracy, the Encyclopedia of U.S.
Foreign Relations, and the Encyclopedia of Nationalism. He received a B.A.
degree from Brandeis University in 1953. In 1959, he received his Ph.D. from
Harvard University.
DONALD W. RUTHERFORD. Mr. Rutherford is a limited partner with Tatum CFO
Partners, LLP in Orange, California, which he joined in January 2000. Since
joining Tatum, Mr. Rutherford has served as Chief Administrative Officer for a
$100 million manufacturer and direct marketer of promotional products, as CFO of
Aspeon, Inc., a public technology products company, as CFO of LifePoint, Inc., a
public medical device company, and as interim CFO of Composite Technology
Corporation, a public developer of innovative applications of composite
materials. From 1995 to 1999, Mr. Rutherford served as Chief Financial Officer
of USGT Resources Inc., a natural gas marketer and asset manager. As a key
member of the management team, he had assisted the company from its starting
stages and was responsible for staffing and developing and implementing systems
and obtaining financing and credit to support a 300% growth over a four-year
period to $500 million in sales. Mr. Rutherford obtained his Chartered
Accountant degree from the Institute of Chartered Accountants in Canada in 1965
after obtaining a degree in industrial engineering from University of Toronto in
1962.
DAVID J. CALDWELL. Mr. Caldwell is a business operations professional with over
20 years of experience in the consumer credit card industry. Before becoming
Chief Operations Officer of Performance Capital Management, LLC on February 4,
2002, Mr. Caldwell was Chief Operating Officer of Performance Capital
Management, Inc., one of the predecessor companies to Performance Capital
Management, LLC, from January 1998 to February 2002. As Chief Operating Officer,
Mr. Caldwell is responsible for the operational activities of Performance
Capital Management, LLC, including management of a collection center and the
sales and acquisitions of charged-off portfolios as well as the day-to-day
operations of the business. From 1975 to 1998, Mr. Caldwell worked in various
capacities at General Electric Capital Corporation, including Vice President of
Recovery Operations for the General Electric Capital Services division from
March 1997 to January 1998 and Vice President of Cardholder Operations for the
Consumer Card Services division of General Electric Capital Corporation from May
1994 to March 1997. As Vice President of Recovery Operations, he was responsible
for the successful operation of the Retailer Financial Services Recovery
Operation, including management of the recovery call center, bankruptcy
collections, payment processing unit, mailroom, facilities, petition processing,
legal, probate, compliance, outside attorney collections, skip tracing, and
interface with 12 outlying business centers. As Vice President of Cardholder
Operations, he was responsible for the successful operation of the G.E. Rewards
Mastercard call center, including
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managing over 500,000 incoming calls per month, leading a workforce of 215
people, and overseeing a financial budget of $5 million. Mr. Caldwell received a
B.S. degree in Business Administration from Western Michigan University in 1975.
EDWARD M. RUCKER. Before becoming the Accounting Manager of Performance Capital
Management, LLC on February 4, 2002, Mr. Rucker was the Accounting Manager of
Performance Capital Management, Inc., one of the predecessor companies to
Performance Capital Management, LLC, from October 2001 to February 2002. As
Accounting Manager, Mr. Rucker has overall responsibility for preparing the
company's accounting records and financial statements. From 1995 to August 2001,
Mr. Rucker was Controller and the Chief Financial Officer of Pickard
Construction, Inc., a construction firm performing as general contractor for
major national firms. In that position, Mr. Rucker was responsible for the
entire accounting and related financial functions of the firm. Mr. Rucker is a
Certified Public Accountant. Mr. Rucker received a B.S. degree in Accounting
from the California State University, Los Angeles in 1968.
DARREN S. BARD. Before becoming Chief Information Officer of Performance Capital
Management, LLC on February 4, 2002, Mr. Bard was Chief Information Officer of
Performance Capital Management, Inc., one of the predecessor companies to
Performance Capital Management, LLC, from April 1998 to February 2002. As Chief
Information Officer, Mr. Bard manages the Information Technology and
Acquisitions/Sales Support Departments. Prior to becoming an officer of
Performance Capital Management, Inc., from April 1996 to April 1998, Mr. Bard
worked as Site Production Planning/Operations Manager at General Electric
Capital Corporation. Mr. Bard received a B.A. degree in psychology from The Ohio
State University in 1991.
WILLIAM D. CONSTANTINO. Mr. Constantino has served as the Chief Officer of
Legal Affairs of Performance Capital Management, LLC since it was formed in
January 2002. Prior to that date, from July 2000 to January 2002, he served as
Chief Legal Compliance Officer of Performance Capital Management, Inc., one of
the predecessor companies to Performance Capital Management, LLC. As in-house
counsel to Performance Capital Management, LLC, Mr. Constantino is responsible
for ensuring that all collection procedures comply with federal and state
consumer protection laws, assisting with the negotiation and purchase of
portfolios, and is the general legal resource for day-to-day corporate
operations. From January 1999 to July 2000, Mr. Constantino practiced law as a
sole practitioner focusing on all aspects of insolvency law, including
commercial and consumer collections, bankruptcy law, and civil litigation. From
January 1982 to December 1998, he was managing partner in the Law Offices of
Leibowitz and Constantino. That firm focused on insolvency law and consumer
protection law. Mr. Constantino received a B.S. degree in Business
Administration from the State University of New York, Albany in 1972 and a Juris
Doctor degree from Western State University School of Law in 1979.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our
directors, our executive officers and persons who own more than ten percent of
our LLC Units to file with the Securities and Exchange Commission and
Performance Capital Management, LLC reports on Forms 3, 4 and 5 reflecting
transactions affecting beneficial ownership. Based solely upon our review of the
copies of such forms received by us, we believe that, for the period from
January 1, 2003 to December 31, 2003, all persons complied with such filing
requirements. We have received a written representation from each of our
directors and executive officers that no Forms 5 are required for the period
ended December 31, 2003.
BOARD OF DIRECTORS INFORMATION
Our Board of Directors has 7 members, each of whom is independent as defined by
Nasdaq Market Listing rules. Our directors are divided into two classes, with
each class serving for a two-year period. Our Board of Directors held a total of
12 meetings during the fiscal year ended December 31, 2003. Each of our
incumbent directors, except Mr. Price who resigned as a director in July 2003
and Mr. Rutherford who was appointed by the Board in January 2004 to fill the
vacancy left by Mr. Price, attended at least 75% of the meetings of the Board of
Directors.
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Our Board of Directors has established an Audit Committee. It currently has no
other committees.
AUDIT COMMITTEE
The Audit Committee of the Board of Directors is composed of three directors,
Messrs. Rutherford, Smith and Woodworth, each of whom is independent as defined
by Nasdaq Market Listing rules. The Audit Committee is responsible to the full
Board of Directors and operates under a written Audit Committee Charter, which
was adopted by the Board of Directors in February 2003. A copy of the Audit
Committee Charter was included as Appendix A to our Proxy Statement filed on
April 29, 2003.
The Audit Committee consults with the auditors concerning the scope of the
audit, reviews the results of their examination, and reviews and approves any
material accounting policy changes affecting the company's operating results.
The Audit Committee is responsible for, among other things, monitoring the
integrity and adequacy of Performance Capital Management, LLC's financial
information, control systems, and reporting practices, and for recommending to
the Board of Directors for ratification by the Members the Audit Committee's
selection of independent auditors for Performance Capital Management, LLC. The
Audit Committee has appointed and the Board of Directors has recommended to the
Members ratification of the selection of Moore Stephens Wurth Frazer and Torbet,
LLP as Performance Capital Management, LLC's independent auditor for the fiscal
year ending December 31, 2004.
The Board of Directors designated Donald W. Rutherford as an "audit committee
financial expert" as defined by the Securities and Exchange Commission rules;
however, the members of the Audit Committee are not professionally engaged in
the practice of accounting or auditing. The Audit Committee relies, without
independent verification, on the information provided to it and on the
representations made by management and the independent auditors that the
financial statements have been prepared with integrity and objectivity and on
the representations of management and the opinion of the independent auditors
that such financial statements have been prepared in conformity with generally
accepted accounting principles.
The Audit Committee met 3 times last year. Each of the members of the Audit
Committee, except Mr. Price who resigned as a director in July 2003 and Mr.
Rutherford who was appointed by the Board in January 2004 to fill the vacancy
left by Mr. Price, attended at least 75% of the meetings held by that committee.
NOMINATING COMMITTEE
Our Board of Directors does not have a nominating committee, as nominations are
made by the members of the Board as a whole. Our Board of Directors does not
have a nominating committee charter. All of our directors are independent as
defined by Nasdaq Market Listing rules. Our Board has not established a separate
nominating committee because all of our directors are independent and vacancies
have occurred only with respect to one director slot. Our Board of Directors
seeks to identify qualified individuals to become board members and determine
the composition of the Board and its Audit Committee. Our Board does not have
any formal specific minimum qualifications for evaluating potential director
candidates. When considering a potential director candidate, the Board looks for
personal and professional integrity, demonstrated ability and judgment, prior
service as a director, and business experience. Our Board believes it is
important to have at least one director who is a financial expert to serve on
our Audit Committee. The Board will review and consider director nominees
recommended by Members. There are no differences in the manner in which the
Board evaluates director nominees based on whether the nominee is recommended by
a Member. Any Member who would like to recommend a director candidate should
contact Mr. William Constantino, our Chief Officer of Legal Affairs, at our
principal executive offices.
Our Board of Directors does not have a policy with regard to consideration of
director candidates recommended by our Members. With the exception of Mr.
Rutherford, who joined the Board in January 2004, all of our directors were
appointed by the bankruptcy judge prior to our emergence from bankruptcy in
February 2002. These directors were all members of The Official Committee of
Equity Security Holders that represented our Members' interests in the
bankruptcy proceeding. Our Board has viewed its continuity during bankruptcy and
since our emergence from bankruptcy as an important stabilizing influence. As
the
8
bankruptcy proceeding recedes further into the past and our business evolves,
our Board intends to assess whether to adopt a policy with regard to
consideration of director candidates recommended by our Members. No Member has
contacted us either suggesting a director candidate or requesting information on
how to recommend a director candidate.
Our Board identified Mr. Rutherford through contacts at a firm that provides
executive talent to clients on a supplemental, interim, project or employed
basis. We did not pay a fee for the introduction to Mr. Rutherford. Our
executive officers and the full Board of Directors interviewed Mr. Rutherford
prior to electing him a director. We recruited Mr. Rutherford primarily with a
view to him serving as a financial expert on our Audit Committee, but also to
enhance the accounting and financial expertise of the Board of Directors.
STOCKHOLDER COMMUNICATION WITH MEMBERS OF THE BOARD OF DIRECTORS
We have no formal procedure for Unit Holder communications with directors.
However, our Board of Directors has provided by resolution that any Unit Holder
who wishes to communicate with a particular director or with all or certain of
the directors or with the entire Board of Directors should direct the
communication to the Chief Officer of Legal Affairs. Our Chief Officer of Legal
Affairs will process all communications received from Unit Holders in accordance
with the process approved by our Board.
ATTENDANCE AT ANNUAL MEETINGS
We do not have any policy regarding director attendance at Annual Meetings of
Members. Last year, six of the seven directors attended the 2003 Annual Meeting.
AUDIT COMMITTEE REPORT
The Audit Committee has reviewed and discussed the company's audited financial
statements for the year ended December 31, 2003 with management, which has
primary responsibility for the financial statements. The Audit Committee has
discussed with Moore Stephens Wurth Frazer and Torbet, LLP the matters that are
required to be discussed by Statement on Auditing Standards No. 61,
"Communication with Audit Committees." The Audit Committee has discussed with
Moore Stephens Wurth Frazer and Torbet, LLP the auditors' independence from
Performance Capital Management, LLC and management and has received from Moore
Stephens Wurth Frazer and Torbet, LLP the written disclosures and the letter
required by Independence Standards Board Standard No. 1, "Independence
Discussions with Audit Committees."
The Audit Committee has considered whether the services provided by Moore
Stephens Wurth Frazer and Torbet, LLP are compatible with maintaining the
independence of Moore Stephens Wurth Frazer and Torbet, LLP and has concluded
that the independence of Moore Stephens Wurth Frazer and Torbet, LLP is
maintained and not compromised by the services provided.
Based on the review and discussion referred to above, the Audit Committee
recommended to the Board of Directors that the audited financial statements be
included in Performance Capital Management, LLC's Annual Report on Form 10-KSB
for the year ended December 31, 2003, for filing with the Securities and
Exchange Commission.
Respectfully Submitted by the Audit Committee,
Donald W. S. Rutherford
Larry C. Smith
Rodney Woodworth
9
COMPENSATION AND OTHER INFORMATION
CONCERNING DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the compensation that we have paid to our Named
Executive Officers for the period from February 4, 2002 (Inception) to December
31, 2002 and the year ended December 31, 2003. Except as provided in the
employment contracts discussed on pages 11 and 12, we do not have a long-term
compensation plan and do not grant any long-term compensation to our executive
officers. No other compensation was granted for the periods covered.
=============================================================================
SUMMARY COMPENSATION TABLE
=============================================================================
Annual Compensation
-------------------------------------
Fiscal Other Annual
Year Salary Bonus Compensation
Name and Principal Position Ended ($) ($) ($)
=============================================================================
David Caldwell 2003 200,002 -- --
Chief Operations Officer 2002 187,413 25,000 --
=============================================================================
William Constantino 2003 135,002 -- --
Chief Officer of Legal Affairs 2002 130,482 25,000 --
=============================================================================
Darren Bard 2003 135,171 -- --
Chief Information Officer 2002 132,839 25,000 --
=============================================================================
OPTION GRANTS
We do not have an employee option plan, nor have we granted any options to our
officers or directors.
COMPENSATION OF DIRECTORS
Our directors receive $1,500 per scheduled meeting of the Board of Directors.
The Board of Directors has regularly scheduled meetings once per month.
All directors receive reimbursement for travel and out-of-pocket expenses
incurred in connection with attendance at all meetings. Except as described
above, none of our directors receive any other compensation for performance of
services as a director of Performance Capital Management, LLC or a member of any
committee of our Board of Directors.
EMPLOYMENT CONTRACTS
We have entered into employment agreements with our three executive officers. We
are in the process of formalizing an indemnification agreement with Edward
Rucker, our accounting manager, which is expected to go before the Board of
Directors for final approval in May 2004. The employment agreements with the
executive officers provide for initial base salaries for David Caldwell, William
Constantino and Darren Bard of $200,000, $135,000 and $135,000, respectively.
Base salaries are to be adjusted periodically by the Board of Directors. The
agreements provide for bonus payments of $25,000 each in 2002. The agreements
also provide for an annual bonus at the end of the first year of employment as
follows: each shall share in an equal amount with all other executives the sum
of the total of all executive annual salaries times two and one half percent for
each and every percentage point for which the ratio of operating expenses to
gross revenues derived directly from collection activity (excluding e.g. sales
revenues collections) is less than 55% for a specific calendar year as
calculated on a cash flow basis. The bonus may be amended or cancelled by the
Board of Directors on the anniversary of the effective date of the employment
agreements. In addition, the officers will receive in lieu of
10
any outstanding equity or equivalent interest in Performance Capital Management,
LLC, a sum equal to the total of all executive annual salaries divided by the
total number of executive officers employed by us at the time of (a) Performance
Capital Management, LLC becoming a "C" corporation or (b) Performance Capital
Management, LLC selling substantially all of its membership units or assets. For
purposes of the compensation section of the agreements, the executive officers
shall be confined to the Chief Operations Officer, Chief Information Officer,
Chief Officer of Legal Affairs and the Chief Human Resource Officer. The
agreements provide that the executive officers shall receive the following
benefits: three weeks of vacation, paid holidays, sick days and health care
benefits.
The term of each employment agreement is five years commencing on July 31, 2002.
On July 31 of each successive year, the term of each employment agreement is
automatically extended for an additional year unless we or the officer gives 90
days advance termination notice. We reserve the right to terminate the agreement
"for cause" if the officer willfully breaches or habitually neglects the duties
that he is required to perform pursuant to the provisions of the agreement, or
commits acts of dishonesty, fraud, misrepresentation or other acts of moral
turpitude as would prevent the effective performance of his or her duties. If we
terminate the agreement "for cause", we shall pay to the officer any
compensation due under the agreement, including any unused vacation, prorated
through the date of termination, and we shall have the option to purchase the
entire ownership interest of the officer, if any, in accordance with the
agreement. The executive officer may terminate the agreement by giving us at
least 30 days notice in advance. Such a termination will be considered "for
cause".
The agreements will not be terminated by any voluntary or involuntary
dissolution of Performance Capital Management, LLC resulting from either a
merger or consolidation in which Performance Capital Management, LLC is not the
consolidated or surviving company, or a transfer of all or substantially all of
the assets of Performance Capital Management, LLC. Any rights, benefits and
obligations under the agreements are to be assigned to the surviving or
resulting company or the transferee of Performance Capital Management, LLC's
assets.
Each of the agreements provides that we will indemnify the executive officer, if
he or she is made a party to or threatened to be made a party to, or otherwise
involved in, any proceeding commenced during the employment term, or after the
employment term, because the officer is or was an employee or agent of
Performance Capital Management, LLC. The indemnification includes any and all
expenses, judgments, fines, penalties, settlements, and other amounts, actually
and reasonably incurred by the executive officer in connection with the defense
or settlement of any such proceeding. The executive officer must have acted in
good faith and in a manner that the officer reasonably believes to be in the
best interests of Performance Capital Management, LLC and, in a criminal
proceeding, the officer must have no reasonable cause to believe that his or her
conduct was unlawful. Any and all expenses, including filing fees, costs of
investigation, attorney's fees, messenger and delivery expenses, postage, court
reporters' fees and similar fees and expenses, incurred by the executive officer
in any proceeding are to be advanced by Performance Capital Management, LLC
prior to the final disposition of the proceeding and subject to considerations
of reasonableness at the written request of the officer, but only if the officer
undertakes to repay the advanced expenses to the extent he is not entitled to
indemnification. The indemnification contemplated by the agreements is not to be
deemed exclusive of any other rights the officers may have to indemnification.
We have been advised that the SEC takes the position that these indemnification
provisions do not affect the liability of any officer or director under
applicable federal and state securities laws.
EMPLOYMENT BENEFIT PLAN
We have a defined contribution plan covering all eligible full time employees
and executive officers of Performance Capital Management, LLC, the Plan Sponsor,
who are currently employed by us and have completed six months of service from
the time of enrollment. The Plan was effective as of September 1994. The Plan
was established by a predecessor of the Plan Sponsor to provide retirement
income for its employees and is subject to the provisions of the Employee
Retirement Income Security Act of 1974 as amended (ERISA).
11
The Plan is a contributory plan whereby participants may contribute up to a
maximum of 15% of pre-tax annual compensation. Participants may also contribute
amounts representing distributions from other qualified defined benefit or
contribution plans. The Plan Sponsor does not make matching contributions.
We do not have any compensation plans that will result in the issuance of LLC
Units or other equity interests.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We are not aware of any related party transactions that would require
disclosure.
CODE OF ETHICS
On December 8, 2003, our Board of Directors adopted a Code of Business Conduct
and Ethics that applies to our Chief Operations Officer and senior financial
officers. A copy of the Code of Business Conduct and Ethics was filed as an
exhibit to our Annual Report on Form 10-KSB for the year ended December 31,
2003.
================================================================================
PROPOSAL NO. 2: RATIFY SELECTION OF INDEPENDENT AUDITORS FOR 2004
================================================================================
Moore Stephens Wurth Frazer and Torbet, LLP served as our independent auditors
for the year ended December 31, 2003, and has been selected by our Audit
Committee to continue as our independent auditors for the year ending December
31, 2004.
Although the selection of Moore Stephens Wurth Frazer and Torbet, LLP is not
required to be submitted to a vote of the Members, our Board of Directors
believes it appropriate as a matter of policy to request that the Members ratify
the selection of the independent auditors for the fiscal year ending December
31, 2004. In the event that the votes in opposition to ratification exceed the
votes in favor of ratification, the adverse vote will be considered as a
direction to our Board of Directors to select other auditors for the fiscal year
ending December 31, 2004.
A representative from Moore Stephens Wurth Frazer and Torbet, LLP is expected to
be present at the Annual Meeting. The representative will have the opportunity
to make a statement and will be able to respond to appropriate questions
submitted either orally or in writing at the meeting.
We initially engaged Moore Stephens Wurth Frazer and Torbet, LLP in February
2002, to conduct an audit of our opening balance sheet upon emergence from
bankruptcy. Prior to engaging Moore Stephens Wurth Frazer and Torbet, LLP, we,
or someone on our behalf, did not consult with Moore Stephens Wurth Frazer and
Torbet, LLP regarding the application of accounting principles to a specific
completed or contemplated transaction, or the type of audit opinion that might
be rendered on our financial statements, and no written or oral advice was
provided by Moore Stephens Wurth Frazer and Torbet, LLP that was an important
factor considered by us in reaching a decision as to an accounting, auditing or
financial reporting issue. We have furnished the above disclosure, made in
response to Item 304 of Regulation S-B, to Moore Stephens Wurth Frazer and
Torbet, LLP for their review.
OUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" RATIFICATION OF THE
SELECTION OF MOORE STEPHENS WURTH FRAZER AND TORBET, LLP, CERTIFIED PUBLIC
ACCOUNTANTS, AS OUR INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31,
2004.
12
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Moore Stephens Wurth Frazer and Torbet, LLP has audited our financial statements
for the past two years. Our Board of Directors maintains an Audit Committee in
accordance with applicable SEC rules. The Audit Committee is directly
responsible for the appointment, compensation, retention and oversight of the
work of the independent auditors for the purpose of preparing and issuing its
audit report or performing other audit, review and tax services for us. The
independent auditors report directly to the Audit Committee and the Audit
Committee is directly responsible for reviewing in advance, and granting any
appropriate pre-approvals of, (a) all auditing services to be provided by the
independent auditor and (b) all non-audit services to be provided by the
independent auditor (as permitted by the Exchange Act), and in connection
therewith to approve all fees and other terms of engagement, as required by the
applicable rules of the Exchange Act and subject to the exemptions provided for
in such rules.
The aggregate fees for professional services by Moore Stephens Wurth Frazer and
Torbet, LLP for 2003 and 2002 for these various services were:
TYPES OF FEES 2003 2002
- -------------------------------------- -------- --------
Audit Fees $ 90,516 $120,504
Audit-Related Fees 19,639 5,500
Tax Fees 11,045 23,175
All Other Fees 3,286 --
-------- --------
TOTAL FEES $124,486 $149,179
======== ========
In the above table, in accordance with new SEC definitions and rules, "audit
fees" are fees we paid Moore Stephens Wurth Frazer and Torbet, LLP for
professional services rendered for the audit of our annual financial statements
and review of financial statements included in our Quarterly Reports on Form
10-QSB, and for services that are normally provided by the auditors in
connection with statutory and regulatory filings or engagements; "audit-related
fees" are fees billed by Moore Stephens Wurth Frazer and Torbet, LLP for
assurance and related services that are traditionally performed by the auditor,
including the audit of our defined contribution employee benefit plan and SEC
compliance work; "tax fees" are fees for tax compliance, tax advice and tax
planning; and "all other fees" are fees billed by Moore Stephens Wurth Frazer
and Torbet, LLP to us for any services not included in the first three
categories.
POLICY ON PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
The Audit Committee's Charter provides that the Audit Committee shall
pre-approve all auditing services and permitted non-audit services to be
performed by the company's independent auditors, subject to the de minimis
exceptions for non-audit services that are approved by the Audit Committee prior
to the completion of the audit. As part of its pre-approval process, the Audit
Committee considers whether such services are consistent with the rules of the
Securities and Exchange Commission on auditor independence. The policy does not
delegate to management the Audit Committee's responsibility to pre-approve
permitted services of the independent auditors.
During 2003, our Audit Committee specifically pre-approved the services
performed by Moore Stephens Wurth Frazer and Torbet, LLP in connection with our
2003 audit. All of the other services performed by Moore Stephens Wurth Frazer
and Torbet, LLP for us during 2003 were pre-approved by our Audit Committee as
to the scope of such services and fees paid for such services.
There were no hours expended on Moore Stephens Wurth Frazer and Torbet, LLP's
engagement to audit our financial statements for the most recent fiscal year
that were attributed to work performed by persons other than the Moore Stephens
Wurth Frazer and Torbet, LLP's full-time, permanent employees.
____________________________________
13
PROPOSALS OF MEMBERS
A Member proposal is a Member's recommendation or requirement that we and/or our
Board of Directors take certain action, which the Member intends to present at a
meeting of our Members. The proposal should state as clearly as possible the
course of action that the Member believes we should follow and should be
accompanied by a supporting statement. The proposal, including the accompanying
supporting statement, may not exceed 500 words.
Proposals received from Members are given careful consideration by us in
accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as
amended. Member proposals are eligible for consideration for inclusion in the
proxy statement for the 2005 Annual Meeting of Members if they are received by
us on or before January 5, 2005. Any Member proposal should be directed to the
attention of the Chief Officer of Legal Affairs, Performance Capital Management,
LLC, at 222 South Harbor Blvd., Suite 400, Anaheim, California, 92805.
In order for a Member proposal submitted OUTSIDE of Rule 14a-8 to be considered
"timely" within the meaning of Rule 14a-4(c), such proposal must be received by
us on or before March 21, 2005. We will have discretionary authority with
respect to Member proposals submitted for consideration at the 2005 Annual
Meeting of Members that are not "timely" within the meaning of Rule 14a-4(c). We
reserve the right to reject, rule out of order, or take other appropriate action
with respect to any proposal that does not comply with these and other
applicable requirements.
ADDITIONAL INFORMATION
Members should direct communications regarding change of address, requests for
transfer of LLC Unit ownership or lost LLC Unit certificates to Performance
Capital Management, LLC, Attn: Harvey "Bud" Webb, Member Relations, 222 South
Harbor Blvd., Suite 400, Anaheim, California, 92805. Mr. Webb may also be
reached by telephone at 714.502.3736 or by facsimile at 714.502.3733.
OTHER MATTERS
We know of no other matters that are likely to be brought before the Annual
Meeting. If, however, other matters not presently known or determined properly
come before the Annual Meeting, the persons named as proxies in the enclosed
Proxy Card or their substitutes will vote such proxy in accordance with their
discretion with respect to such matters.
By Order of the Board of Directors,
/s/ David J. Caldwell
David J. Caldwell
Chief Operations Officer
Anaheim, California
May 3, 2004
14
PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
PERFORMANCE CAPITAL MANAGEMENT, LLC
2004 ANNUAL MEETING OF MEMBERS - JUNE 14, 2004
The undersigned Member(s) of PERFORMANCE CAPITAL MANAGEMENT, LLC, a California
limited liability company (the "Company"), hereby acknowledges receipt of the
Notice of Annual Meeting of Members and the Proxy Statement, and hereby appoints
David Caldwell and Darren Bard, or either of them, as proxies and
attorneys-in-fact, with full power to each of substitution, on behalf and in the
name of the undersigned, to represent the undersigned at the 2004 Annual Meeting
of Members of the Company to be held on Monday, June 14, 2004, and at any
adjournment(s) or postponement(s) thereof, and to vote all LLC Units that the
undersigned would be entitled to vote, if then and there personally present, on
the matters set forth below and, in accordance with their discretion, on any
other business that may come before the meeting:
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE PROPOSALS
DESCRIBED IN THE PROXY STATEMENT. IF A PROXY IS SIGNED AND DATED BUT NOT MARKED,
YOU WILL BE DEEMED TO HAVE VOTED "FOR" THE PROPOSALS DESCRIBED IN THE PROXY
STATEMENT. THIS PROXY REVOKES ALL PRIOR PROXIES GIVEN BY THE UNDERSIGNED WITH
RESPECT TO THE LLC UNITS COVERED HEREBY.
PROPOSAL NO. 1 - TO ELECT THREE CLASS I DIRECTORS TO SERVE A TWO-YEAR TERM AND
UNTIL EACH DIRECTOR'S SUCCESSOR HAS BEEN DULY ELECTED AND QUALIFIED.
Nominees: Larisa Gadd
Rodney Woodworth
Donald W. Rutherford
[ ] For the Nominees Listed above [ ] Withhold Authority to
(except as indicated below) Vote for All Nominees
Instruction: To withhold authority to vote for any Nominee, write that
Nominee's name on the line immediately below.
--------------------------------------------------------------------
PROPOSAL NO. 2 - TO RATIFY THE SELECTION OF MOORE STEPHENS WURTH FRAZER AND
TORBET, LLP, AS INDEPENDENT AUDITORS FOR THE COMPANY FOR THE FISCAL YEAR ENDING
DECEMBER 31, 2004.
[ ] For [ ] Against [ ] Abstain
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Page 1 of 2
NOTE: THIS PROXY SHOULD BE MARKED, DATED AND SIGNED BY EACH MEMBER(S) EXACTLY
AS HIS OR HER OR ITS NAME APPEARS ON THE LLC UNIT CERTIFICATE(S), AND RETURNED
IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned Member(s). If you do not sign and return this proxy or attend
the meeting and vote by ballot, your LLC Units cannot be voted. If you wish to
vote in accordance with the Board of Directors' recommendations, just sign where
indicated. You need not mark any boxes.
IF YOU DO NOT MARK A BOX INDICATING HOW YOU WANT TO VOTE ON A PROPOSAL, YOUR LLC
UNITS WILL BE VOTED "FOR" THAT PROPOSAL.
When LLC Units are held of record by joint tenants, both should sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such. If a corporation, please sign in full corporate name as its
authorized officer. If a partnership, please sign in partnership name as its
authorized person.
DATED: , 2004.
----------------------
-----------------------------------------------------------------
Print name(s) exactly as shown on LLC Unit Certificate(s)
----------------------------- ----------------------------
Signature (and Title, if any) Signature (if held jointly)
Page 2 of 2