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 [ ]
Check the appropriate box:
[ ] 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 Pursuant to Section 240.14a-12
KSW, INC.
------------------------------------------------
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
KSW, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
to be held May 8, 2007
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of KSW,
Inc., a Delaware corporation (the "Company"), will be held on May 8, 2007, at
2:00 p.m., New York time, at the American Stock Exchange, 16 Trinity Place, New
York, New York 10006, for the following purposes:
1. to elect two Class III Directors to serve until 2010, or until
their successors shall have been duly elected and qualified ("Proposal 1"); and
2. to ratify the appointment of Marden Harrison & Kreuter, CPAs,
P.C. as independent auditors of the Company for the fiscal year ending December
31, 2007 ("Proposal 2"); and
3. to transact such other business as may properly come before
the meeting or any adjournment thereof.
Stockholders of record at the close of business on April 3, 2007 will
be entitled to notice of and to vote at the meeting and any adjournments.
All stockholders are cordially invited to attend the meeting in person.
However, to assure your representation at the meeting, you are urged to SIGN,
DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE PROVIDED, in order that
as many shares as possible may be represented at the meeting. Any stockholder
attending the meeting may vote in person even if he or she has returned a proxy
card.
Sincerely,
James F. Oliviero
General Counsel
Long Island City, New York
Dated: April 3, 2007
KSW, INC.
37-16 23rd Street
Long Island City, New York 11101
(718) 361-6500
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PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
May 8, 2007
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GENERAL INFORMATION
General
The accompanying proxy is solicited by and on behalf of the Board of Directors
of KSW, Inc., a Delaware corporation (the "Company"), to be voted at the 2007
Annual Meeting of Stockholders (the "Annual Meeting") to be held at the American
Stock Exchange, 16 Trinity Place, New York, New York 10006, on May 8, 2007, at
2:00 p.m., New York time, and at any and all adjournments thereof. The Annual
Meeting is being held for the purposes set forth in the accompanying Notice of
Annual Meeting to Stockholders.
Cost of Solicitation
The cost of solicitation will be borne by the Company. This proxy statement and
the accompanying proxy are first being sent to the stockholders of the Company
on or about April 11, 2007. A copy of the Company's 2006 Annual Report on Form
10-K is enclosed herewith.
Stockholders Entitled to Vote
Pursuant to the By-Laws of the Company, the Board of Directors has fixed the
time and date for the determination of stockholders entitled to notice of and to
vote at the meeting as of the close of business on April 3, 2007. Accordingly,
only stockholders of record on such date and at such time will be entitled to
vote at the meeting, notwithstanding any transfer of any stock on the books of
the Company thereafter.
At the close of business on March 22, 2007, the Company had outstanding
5,803,643 shares of Common Stock, $.01 par value per share (the "Common Stock"),
each of which entitled the holder to one vote. There were no issued shares held
by the Company in its treasury.
Required Vote
The presence of the holders of a majority of the outstanding shares of Common
Stock entitled to vote at the Annual Meeting, present in person or represented
by proxy, is necessary to constitute a quorum. The affirmative plurality of the
shares of Common Stock represented in person or by proxy at the meeting is
required for the election of each director. For all other matters, the
affirmative vote of the holders of the majority of the shares of Common Stock
present in person or represented by proxy at the meeting and entitled to vote on
the subject matter and which has actually been voted is required for approval.
Proxies marked as abstaining (including proxies containing "broker non-votes")
on any matter to be acted upon by stockholders will be treated as present at the
meeting for purposes of determining a quorum but will not be counted as votes
cast on such matters. A "broker non-vote" occurs when a broker holds shares of
Common Stock for a beneficial owner and does not vote on a particular proposal
because the broker does not have discretionary voting power for that particular
item and has not received instructions from the beneficial owner. If a quorum is
present, abstentions will have no effect on the election of directors or the
proposal for the ratification of the reappointment of auditors.
A proxy may be revoked by the stockholder at any time prior to its being voted.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivery to the Secretary of the Company
of a written notice of revocation, or a duly executed proxy bearing a later
date, or by attending the meeting and voting in person.
2
If a proxy is properly signed and is not revoked by the stockholder, the shares
it represents will be voted at the meeting in accordance with the instructions
of the stockholder. If the proxy is signed and returned without specifying
choices, the shares will be voted in favor of the election as director of the
nominees listed on the following pages, in favor of Proposal 2 and as
recommended by the Board of Directors with regard to all other matters, or if no
such recommendation is given, in their own discretion. Votes are tabulated at
the Annual Meeting by inspectors of election.
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information relating to the beneficial ownership
of the Common Stock and options exercisable within 60 days as of March 22, 2007
by (i) those persons who were known by the Company to be the beneficial owners
of more than 5% of the outstanding Common Stock, (ii) each of the Company's
directors and nominees, (iii) each executive officer of the Company named in the
Summary Compensation Table annexed hereto as Appendix "A", and (iv) all of the
Company's directors and executive officers as a group. Except as indicated in
the footnotes to the table, the persons named in the table have sole voting and
investment power with respect to all shares of Common Stock shown as
beneficially owned by them, subject to community property laws where applicable.
The percentage listed in the column entitled "Percentage Ownership" is
calculated based on 6,113,645 shares of Common Stock and options exercisable
within 60 days outstanding on March 22, 2007. Unless otherwise indicated, the
address of each person named in the table below is c/o KSW, Inc., 37-16 23rd
Street, Long Island City, New York 11101.
NUMBER OF PERCENTAGE
NAME OF BENEFICIAL OWNER SHARES OWNERSHIP
- ------------------------------------ --------- ----------
Floyd Warkol 894,897 (1) 14.6%
Meadow Lane
Purchase, NY 10577
Stanley Kreitman 20,000 *
4 Chestnut Drive
East Hill, NY 11576
John Cavanagh 20,000 (2) *
222 Mill Dam Road
Centerport, NY 11721-0224
Innis O'Rourke, Jr 21,000 (3) *
1 Horse Hollow Road
Locust Valley, NY 11560
Warren O. Kogan - *
13345 S.E. 97th Terrace Road
Summerfield, FL 34491
Richard W. Lucas 6,667 (4) *
James F. Oliviero - *
Vincent Terraferma 6,667 (4) *
All directors and executive officers 969,231 (5) 15.9%
as a group (8 persons)
3
NUMBER OF PERCENTAGE
NAME OF BENEFICIAL OWNER SHARES OWNERSHIP
- ------------------------------------ --------- ----------
Microcapital LLC 396,150 6.5%
623 Fifth Avenue
New York, NY 10022
Nicusa Capital Partners, LP 408,900 6.7%
17 State Street
New York, NY 10004
Allen & Company 312,500 5.1%
711 Fifth Avenue
New York, NY
* Less than one percent.
(1) Includes 25,000 shares owned by the Floyd and Barbara Warkol Charitable
Foundation, of which Mr. Warkol is a Trustee, as well as 200,000 options
exercisable within 60 days.
(2) Includes 6,666 options exercisable within 60 days.
(3) Includes 20,000 options exercisable within 60 days.
(4) Includes 6,667 options exercisable within 60 days.
(5) Includes 240,000 options exercisable within 60 days.
4
PROPOSAL NO. 1
ELECTION OF DIRECTORS
General
The Certificate of Incorporation of the Company provides that the Company's
business shall be managed by a Board of Directors of not less than three and not
more than twelve, with the exact number fixed by the Board of Directors from
time to time. There are currently five seats on the Board of Directors. The
Board of Directors of the Company is divided into three classes: Class I, Class
II and Class III. The directors in each class serve terms of three years each
and until their successors are elected and qualified.
There are two positions on the Board of Directors to be voted upon. Under the
Company's By-Laws, the terms of Class III Directors Floyd Warkol and Warren O.
Kogan expire on the date of the 2007 Annual Meeting. The independent directors
of the Board of Directors have unanimously nominated both of them for a
three-year term, expiring at the 2010 Annual Meeting. Proxies are only being
solicited for these nominees.
The nominees have consented to being named in this Proxy Statement and to serve
if elected. If a nominee becomes unable to accept nomination or election, the
persons named in the proxy may vote for a substitute nominee selected by the
Board of Directors. The Company's management, however, has no present reason to
believe that any nominee will be unable to serve as director, if elected.
If a quorum is present and voting, the nominees receiving the highest number of
votes will be elected to the Board of Directors. Abstentions and broker
non-votes are not counted in the election of directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES
Procedures for Stockholder Nominations for Directors
The By-Laws of the Company permit nominations of candidates for election to the
Board of Directors to be made by the Board of Directors or by any stockholder
entitled to vote for the election of directors. To be timely, a stockholder's
notice must be delivered to or mailed and received at the principal executive
offices of the Company not less than 60 calendar days prior to the meeting;
provided, however, that in the event that public announcement of the date of the
meeting is not made at least 75 calendar days prior to the date of the meeting,
notice by the stockholder to be timely must be so received not later than the
close of business on the 10th calendar day following the day on which public
announcement is first made of the date of the meeting. To be in proper written
form, such stockholder's notice must set forth or include (i) the name and
address, as they appear on the Company's books, of the stockholder giving the
notice and of the beneficial owner, if any, on whose behalf the nomination is
made; (ii) a representation that the stockholder giving the notice is a holder
of record of stock of the Company entitled to vote at such meeting and intends
to appear in person or by proxy at the meeting to nominate the person or persons
specified in the notice; (iii) the class and number of shares of stock of the
Company owned beneficially and of record by the stockholder giving notice and by
the beneficial owner, if any, on whose behalf the nomination is made; (iv) a
description of all arrangements or understandings between or among any of (A)
the stockholder giving the notice, (B) the beneficial owner on whose behalf the
notice is given, (C) each nominee and (D) any other person or persons (naming
such person or persons) pursuant to which the nomination or nominations are to
be made by the stockholder giving notice; (v) such other information regarding
each nominee, and any other person or persons giving the notice as would be
required to be included in a proxy statement filed pursuant to the proxy rules
of the Securities and Exchange Commission (the "SEC") had the nominee been
nominated, or intended to be nominated, by the Board of Directors; and (vi) the
signed consent of each nominee to serve as a director of the Company if so
elected. At the request of the Board of Directors, any person nominated by the
Board of Directors for election as a Director must furnish to the Secretary that
information required to be set forth in a stockholder's notice of nomination
which pertains to the nominee. The presiding officer of the meeting for election
of Directors will, if the facts warrant, determine that a nomination was not
made in accordance with the procedures prescribed by the Company's By-Laws, and
if he or she should so determine, he or she will so declare to the meeting and
the defective nomination will be disregarded. Notwithstanding the foregoing, a
stockholder must also comply with all applicable requirements of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder (the
"Exchange Act"). Directors and Nominees
5
The following table sets forth certain information concerning the nominees for
election as Class III Directors of the Company, and the continuing Class I
Directors and Class II Director of the Company.
Name Age Director Since
- ----------------------------------- ----- --------------
NOMINEES AS CLASS III DIRECTORS
TO SERVE UNTIL 2010
Floyd Warkol 59 1994
Warren O. Kogan 80 2006
CONTINUING AS CLASS I DIRECTORS
TO SERVE UNTIL 2008
Stanley Kreitman 75 1999
John Cavanagh 71 2004
CONTINUING AS CLASS II DIRECTOR
TO SERVE UNTIL 2009
Innis O'Rourke, Jr 85 2004
The Company is not aware of any family relationship between any director,
nominee for director or executive officer of the Company.
Mr. Floyd Warkol has been principally employed as Chairman of the Board since
December 15, 1995 and as President, Secretary and Chief Executive Officer of the
Company and as Chairman and Chief Executive Officer of its subsidiary, KSW
Mechanical Services, Inc. ("KSW Mechanical"), since January 1994.
Mr. Warren O. Kogan was appointed to the Board of Directors as a Director on
March 10, 2006. He has been an arbitrator for the American Arbitration
Association and is a construction and real estate private consultant. From 1990
to 2000 he was Executive Vice President of the Subcontractors Trade Association
of New York City. From 1980 to 1990, he was President and Chief Executive
Officer of H. Sand & Co., a major mechanical and HVAC contractor.
Mr. Stanley Kreitman was elected to the Board of Directors by the Company's
stockholders on May 18, 1999 after having been appointed as a director by the
other members of the Board of Directors effective February 18, 1999. Since 1994,
Mr. Kreitman has been Chairman of Manhattan Associates, an investment firm, and
currently is Chairman of the N.Y.C. Department of Corrections. He has been a
senior advisor to Signature Bank from 2001 to present. He is a published author
and lecturer on business investment matters. He is a member of the Board of
Directors of Medallion Financial Corp. (NASDAQ), Capital Lease Finance, Inc.
(NYSE), CCA Industries, Inc. (AMEX), Geneva Mortgage Corp. (OTC), and Century
Bank - Sarasota, Fl.
Mr. John Cavanagh was appointed to the Board of Directors as a Director on March
8, 2004 and elected at the annual meeting of stockholders, on May 10, 2005. He
is a consultant to various construction and engineering companies, President of
Cavanagh/Stewart International Inc., and John A. Cavanagh Consulting Services,
Inc., both construction management firms, and President of American Fire
Suppressant Products, Inc. Until September 2003, he was the Vice Chairman of
AMEC Construction Management, Inc. (formerly known as Morse Diesel
International), one of the largest construction management companies in the
United States. He is Chairman Emeritus of the Contractors' Association of
Greater New York and Building Trades Employer's Association. He is also past
Chairman and remains a member of the Board of Directors of the New York Building
Congress. He is on the Board of Directors of Construction Skills 2000,
Nontraditional Employment for Women and Visionary Vehicles, LLC.
6
Mr. Innis O'Rourke, Jr. was appointed to the Board of Directors as a Director on
March 8, 2004 and elected at the annual meeting of stockholders, on May 10,
2006. He is an Arbitrator for the New York Stock Exchange and a consultant to
the Village of Upper Brookville and its police department. In the past, he was a
Director of JWP, Inc., a multi-billion dollar construction corporation, and
Greenpoint Savings Bank.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors currently has, and appoints the members of, standing
Audit and Compensation Committees. Each member of the Audit and Compensation
Committees is an "independent director" in accordance with the rules and
regulations of the American Stock Exchange, LLC ("Amex"). Other than the payment
of attendance fees, during 2006 there were no transactions, relationships or
arrangements between the Company and any independent director. The members of
each of the committees of the Board of Directors are as follows:
AUDIT COMMITTEE COMPENSATION COMMITTEE
- ------------------------ ----------------------
Stanley Kreitman - Chair John Cavanagh - Chair
Warren O. Kogan Stanley Kreitman
Innis O'Rourke, Jr. Warren O. Kogan
AUDIT COMMITTEE
The Audit Committee meets with the Company's independent registered public
accounting firm and management to assure that all are carrying out their
respective responsibilities. The Audit Committee is responsible for selecting,
appointing and, as necessary, terminating the Company's independent registered
public accounting firm, and reviews the performance and fees of the independent
registered public accounting firm prior to appointing it. The Audit Committee
also meets with the independent registered public accountants, without
management present, to discuss the scope and results of their audit work,
including the adequacy of internal controls and the quality of financial
reporting. The independent registered public accountants have full access to the
Audit Committee.
The Audit Committee met four times during the fiscal year ended December 31,
2006.
A written charter for the Audit Committee was approved by the Board of Directors
effective May 11, 2000. An amended written charter was approved by the Board of
Directors effective February 16, 2006.
The Board of Directors has determined that each of the members of the Audit
Committee is "independent" under the listing standards of Amex and under the
independence criteria established by the SEC for audit committee members.
The Board of Directors has also determined that Mr. Kreitman is an "audit
committee financial expert" as defined in Item 401(h)(2) of Regulation S-K of
the Exchange Act and is independent as that term is used in Item 7(d)(3)(iv) of
Schedule 14A of the Exchange Act.
Mr. Kogan was appointed to the Audit Committee on January 3, 2007 to replace
Russell Molina, who served on the Audit Committee during 2006 and who resigned
as a director for personal reasons on January 3, 2007.
The Audit Committee Charter was annexed as an appendix to the Company's
Definitive Proxy Statement, dated April 7, 2006.
7
COMPENSATION COMMITTEE
The Compensation Committee is responsible for the performance review of the
Chief Executive Officer, who in turn reviews the performance of each member of
senior management and determines their compensation levels. The Compensation
Committee periodically reviews compensation levels for competitiveness and
reasonableness as compared to industry peers and competitors. The Compensation
Committee met twice during the fiscal year ended December 31, 2006. The
Compensation Committee Charter is annexed hereto as Appendix E.
NOMINATION OF DIRECTORS
Due to the size of the Board of Directors, the Company does not have a
nominating committee to select director nominees. All nominees for director are
selected based on a vote of the majority of the independent directors of the
Board of Directors. The Board of Directors has determined that four of the
current five members of the Board of Directors (Messrs. Cavanagh, Kogan,
Kreitman and O'Rourke) are "independent directors" in accordance with the rules
and regulations of Amex. Only independent directors vote on Board of Director
nominees.
The assessment by which the independent directors of the Board of Directors
consider candidates for director is based upon various criteria, including
having business experience on a management level with a company which issues
audited financial statements, integrity and independence, demonstrated
leadership ability, diverse perspectives and the ability to exercise sound
business judgment. Nominees for directors should have the ability to read and
understand financial statements. Candidates with construction industry or real
estate experience and contacts are given special consideration. The Board of
Directors also considers the candidate's reputation and standing in the business
community, as well as participation in industry associations relevant to the
Company's business.
In the case of incumbent directors whose terms of office are set to expire, the
independent directors of the Board of Directors review such directors' overall
service to the Company during their term, including the number of meetings
attended, level of participation, quality of performance, and any transactions
of such directors with the Company during their term.
Consideration of new director nominee candidates typically involves a series of
internal discussions, review of information concerning candidates and interviews
with selected candidates. The independent directors identify potential
candidates by recommendations from its members, Company management and
stockholders, as well as by consulting with the Company's legal, financial and
auditing professionals and with other members of the business community in
general and the construction industry in particular. The Company does not pay
fees to such professionals or third parties for any such assistance.
The independent directors of the Board of Directors will consider nominees for
director recommended by stockholders provided the procedures set forth under the
heading "Stockholders Proposal for 2008 Annual Meeting" (below), are followed by
stockholders in submitting recommendations. Stockholder nominations that comply
with such procedures will be evaluated in the same manner (including using the
same criteria as set forth above) and will receive the same consideration as
nominees recommended by the independent directors of the Board of Directors.
DIRECTORS' ATTENDANCE AT MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors held a total of four quarterly meetings in 2006, which
does not include actions by written consent or committee meetings. Each director
serving during the fiscal year ended December 31, 2006 attended at least 75% of
the aggregate of the total number of meetings of the Board of Directors and the
total number of meetings held by all committees of the Board of Directors on
which he served.
DIRECTORS' ATTENDANCE AT ANNUAL MEETINGS OF STOCKHOLDERS
All members of the Board of Directors are required to attend the Company's
Annual Meeting of stockholders. All members of the Board of Directors serving as
directors during the fiscal year ended December 31, 2006, attended the 2006
Annual Meeting of Stockholders.
8
STOCKHOLDER COMMUNICATIONS WITH DIRECTORS
Stockholder communications to the Board of Directors may be sent by mail
addressed to the Board of Directors generally, or to a member of the Board of
Directors individually, c/o James F. Oliviero, Director of Investor Relations,
KSW, Inc., 37-16 23rd Street, Long Island City, NY 11101. All communications so
addressed will be immediately forwarded to the Board of Directors or the
individual member of the Board of Directors, as applicable.
CODE OF ETHICS
The Company has adopted a written Code of Ethics (the "Code of Ethics") that
applies to our directors, principal executive officer and principal financial
and accounting officer. Copies of the Code of Ethics will be provided free of
charge upon written request directed to the Company's Director of Investor
Relations, at the Company's executive office.
AUDIT COMMITTEE REPORT
In accordance with SEC rules, the Audit Committee has prepared the following
report:
As part of its ongoing activities, the Audit Committee has:
o reviewed and discussed with management the Company's audited
consolidated financial statements for the fiscal year ended
December 31, 2006;
o discussed with the independent registered public accounting firm
the matters required to be discussed by Statement on Auditing
Standards No. 61, Communication with Audit Committees, as
amended; and
o received the written disclosures and the letter from the
independent registered public accounting firm required by
Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees, and has discussed with the
independent registered public accounting firm its independence.
Based on the review and discussions referred to above, the Audit Committee
recommended to the Board of Directors that the audited consolidated financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2006. Mr. Warren O. Kogan has not participated in
this review and discussions, as he was appointed to the Audit Committee,
effective January 3, 2007.
Stanley Kreitman
Innis O'Rourke, Jr.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is comprised of three non-employee directors, Mr.
Kogan, Mr. Kreitman and Mr. Cavanagh.
COMPENSATION DISCUSSION AND ANALYSIS
General Philosophy. We compensate our senior management through a mix
of base salary, bonus and equity compensation designed to be competitive with
comparable employers and to align management's incentives with the long-term
interests of our stockholders. Our compensation setting process consists of
establishing targeted overall compensation for each senior manager and then
allocating that compensation among base salary and incentive compensation. At
the senior-most levels, we design the incentive compensation to reward
company-wide performance through tying awards primarily to earnings growth. At
lower levels, we design the incentive compensation to reward the achievement of
specific operational goals within areas under the control of the relevant
employees, although company-wide performance is also a factor.
9
Base Salaries. We seek to provide our senior management with a level of
assured cash compensation in the form of base salary that facilitates an
appropriate lifestyle given their professional status and accomplishments.
Members of the Compensation Committee of our Board of Directors have strong ties
to the construction industry and are familiar with the compensation paid to
senior construction industry executives in the New York City region. Using such
knowledge, the Compensation Committee concluded that a base salary of $450,000
for each of 2006 and 2007 was appropriate for our Chief Executive Officer. This
salary was set in a written Employment Agreement, effective January 1, 2006, and
which expires on December 31, 2009. For 2006 we concluded that a base salary of
$180,000 for 2006 was appropriate for the Chief Operating Officer of KSW
Mechanical. For 2007, his base salary was set at $ 200,000.
Salaries of our Chief Financial Officer and General Counsel are based
on their experience and ability to support and facilitate the achievement of
company objectives. During 2006, their base salaries were $130,000 and $175,000,
respectively. For 2007, their base salaries increased to $142,500 and $180,000,
respectively.
Bonuses. Our practice is to award cash bonuses based upon the
achievement of performance objectives. For our Chief Executive Officer, his
bonus for each of the years 2006 and 2007, as provided by his written Employment
Agreement, is an amount equal to 9.5% of our annual profits in excess of
$250,000, before taxes and stock option expenses. We believe that linking his
bonus to profits is in the best interests of shareholders, since profitability
is an important factor in determining our stock price. The bonus of our Chief
Operating Officer is determined by our Chief Executive Officer and is based on
how well our Chief Operating Officer monitors and controls the Company's
operations in the field, as well as in the office. Factors which are considered
include labor productivity, identifying jobsite conditions which would benefit
from increased management attention and problem solving, and the effectiveness
of the Company's purchasing, billing and cost monitoring systems.
Bonuses paid to our Chief Financial Officer and General Counsel are
based on a review by our Chief Executive Officer on their success in achieving
the specified goals of their department, as well as their effectiveness in
supporting the operations of the Company.
Equity Compensation. Historically, the primary form of equity
compensation that we awarded consisted of non-qualified stock options awarded
pursuant to our 1995 Stock Option Plan. We selected this form to provide
management personnel with an incentive to help maximize Company profits, which
generally will favorably influence stock price and increase shareholder value.
No stock options were granted to employees in 2005 except for 20,000 stock
options granted to the Company's Chief Financial Officer. The 1995 Stock Option
Plan expired in December 2005. Therefore, no equity compensation was awarded in
2006.
Perquisites and Other Benefits. We annually review the perquisites that
each member of senior management receives. We pay the premiums on a $1.0 million
life insurance policy for our Chief Executive Officer, payable on his death to
the beneficiary of his choice. He also is provided with a company car and driver
at an annual cost of approximately $92,000 to facilitate his ability to attend
multiple meetings during a work day at various construction sites and related
offices throughout the New York City metropolitan area. When in the office, the
driver provides clerical services. All members of senior management participate
in the Company's medical and 401(k) plans which are available to all employees.
Board Process. The Compensation Committee of our Board of Directors
sets all compensation and equity awards to our Chief Executive Officer. The
Chief Executive Officer determines all compensation and equity awards to other
officers and senior management personnel.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The following report, submitted by the Compensation Committee of the Board of
Directors (the "Compensation Committee"), provides information regarding
policies and practices concerning compensation of the Chief Executive Officer
and other executive officers.
10
The Company's Compensation Committee is comprised of three of the Company's
independent directors. The Compensation Committee sets the salary, awards and
benefits of the Chief Executive Officer, and has delegated to that officer the
right to determine the salary, awards and benefits of senior management.
The Company's Compensation Discussion and Analysis ("CD&A") is set forth in the
Company's Definitive Proxy Statement pursuant to Section 14(a) of the Securities
Act of 1934. The Compensation Committee has reviewed and discussed the CD&A with
management and, based on its review and discussion, recommended to the Board of
Directors that the CD&A be included in the Company's Proxy Statement.
Stanley Kreitman
John Cavanagh
Warren O. Kogan
COMPENSATION OF DIRECTORS
During 2006, the Company paid its non-employee directors an annual fee of
$16,000, an attendance fee of $1,000 per Board of Directors meeting and $500 per
committee meeting if not held in conjunction with a Board of Directors meeting.
See Appendix D, Director Compensation Table, annexed hereto.
COMPENSATION OF EXECUTIVES
See Appendix A, Summary Compensation Table, for year ended 12/31/06, annexed
hereto.
EMPLOYMENT AGREEMENTS
On September 12, 2006, the Company, KSW Mechanical and Floyd Warkol, the
Chairman and Chief Executive Officer of the Company, entered into an employment
agreement (the "Employment Agreement"), effective as of January 1, 2006.
Under the terms of the Employment Agreement, Mr. Warkol will continue to be
employed as the Chief Executive Officer of the Company and KSW Mechanical for
the period January 1, 2006 through December 31, 2007. Mr. Warkol will be paid an
annual salary of $450,000, based upon a five day work week. In addition, Mr.
Warkol will receive each year an amount equal to 9.5% of the Company's annual
profits, before taxes and stock option expenses, which profits are in excess of
$250,000.
Under the Employment Agreement, Mr. Warkol is also entitled to medical
insurance, disability insurance with payments up to 60% of his base
compensation, a $1 million policy of life insurance payable as directed by him
(at a cost of approximately $3,600 per year) and a car with a driver (at a cost
of approximately $92,000 per year, of which $30,500 relates to the personal
portion of this expense).
The Employment Agreement may be terminated by the Company for "cause", which
includes Mr. Warkol's willful and continued failure to perform his duties, fraud
or embezzlement, conviction of a felony and the inability of Mr. Warkol to
perform his duties. Mr. Warkol may terminate the Employment Agreement upon the
sale of the Company or substantially all of its assets.
On March 6, 2007, the Compensation Committee of the Board of Directors and Mr.
Warkol agreed to extend the term of the Employment Agreement for two years,
until December 31, 2009, on the same terms and conditions as in the Employment
Agreement.
OUTSTANDING EQUITY AWARDS AT FISCAL 2006 YEAR-END
See Appendix B, Outstanding Equity Awards Table, annexed hereto.
11
EQUITY COMPENSATION PLAN INFORMATION
The following table sets forth information as of December 31, 2006 regarding
shares of Common Stock to be issued upon exercise and the weighted-average
exercise price of all outstanding options, warrants and rights granted under the
Company's equity compensation plans as well as the number of shares available
for issuance under such plans. The Plan expired in December 2005.
NUMBER OF SECURITIES
NUMBER OF SECURITIES REMAINING AVAILABLE FOR
TO BE ISSUED UPON WEIGHTED-AVERAGE FUTURE ISSUANCE UNDER
EXERCISE OF EXERCISE PRICE OF EQUITY COMPENSATION PLANS
OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, (excluding securities
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS reflected in column (a))
- ---------------------------- -------------------- -------------------- -------------------------
(a) (b) (c)
Equity compensation plans
approved by security
holders 368,835 $ 1.65 0
Equity compensation plans
not approved by
security holders - - -
-------------------- -------------------------
Total 368,835 0
==================== =========================
OPTION EXERCISES AND STOCK VESTED DURING 2006
See Appendix C, Option Exercises and Stock Vested Table, annexed hereto.
CERTAIN RELATED PARTY TRANSACTIONS
There have been no transactions since January 1, 2006, and no transactions are
currently proposed between the Company and any related persons that are required
to be reported. Any transaction required to be reported must be approved in
writing by the Board of Directors as being in the Company's interest.
12
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's executive officers and
directors, and persons who own more than 10% of a registered class of the
Company's equity securities to file reports of initial ownership and changes in
ownership with the SEC. Executive officers and directors and greater than 10%
beneficial owners are required by SEC regulations to furnish the Company with
copies of all Section 16(a) forms they file. Based solely on review of the
copies of such forms furnished to the Company, or written representations from
certain reporting persons that no Forms 5 were required, the Company believes
that during the year ended December 31, 2006, its executive officers, directors
and stockholders of more than 10% of the Company complied with all applicable
Section 16(a) filings requirements, except that a 500 share sale on October 3,
2006 by Floyd Warkol, under his Rule 10b5-1 plan, was not reported until January
8, 2007 due to a reporting error by the plan administrator.
INDEMNIFICATION
The Company's Certificate of Incorporation provides that a director or officer
of the Company may be indemnified by the Company to the full extent permitted by
the Delaware General Corporation Law or any other applicable law.
PERFORMANCE GRAPH
The following graph compares the cumulative total returns for our Common Stock
for the five-year period ending December 31, 2006 with the NASDAQ Market Index
and an index of all publicly traded companies in the Plumbing, Heating and Air
Conditioning industry (SIC Code 1711) (the "SIC Code Index") for the same
period. Total return equals change in stock price plus dividends paid, and
assumes the investment of $100 in the Company's Common Stock and in each index
on January 1, 2001 and that all dividends are reinvested. The information has
been obtained from sources believed to be reliable, but neither its accuracy nor
its completeness is guaranteed. The performance graph is not necessarily
indicative of future investment performance.
2001 2002 2003 2004 2005 2006
-------- -------- -------- -------- -------- --------
KSW, INC. 100 78.67 82.67 54.67 373.33 999.54
SIC CODE INDEX 100 42.54 67.3 92.34 111.12 132.47
NASDAQ MARKET INDEX 100 69.75 104.88 113.7 116.19 128.12
Source: Core Data, Inc.
13
PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Audit Committee has selected Marden, Harrison & Kreuter, CPAs, P.C. ("MHK"),
certified public accountants, as the Company's independent registered public
accounting firm, for the fiscal year ending December 31, 2007, subject to
ratification of such appointment by the stockholders. In the event of a negative
vote on ratification, the Audit Committee will reconsider its selection.
On September 18, 2003, the Company's Audit Committee engaged MHK as its
principal independent registered public accounting firm. Their appointment,
through December 31, 2006, was ratified by the stockholders at the 2004, 2005
and 2006 Annual Meetings.
During the year ended December 31, 2006, neither the Company nor anyone on its
behalf consulted with MHK regarding any of the matters or events set forth in
Item 304(a)(2)(i) and (ii) of Regulation S-K. Rosen Seymour Shapss Martin and
Company, LLP ("RSSM") were the Company's independent accountants for the fiscal
year ended December 31, 2002 and reviewed the financial statements included the
Company's Form 10-Q for the first two quarters of 2003.
FEES BILLED BY INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
During 2006, MHK billed the Company $150,000 for professional services rendered.
The following table sets forth the aggregate fees billed by MHK and RSSM for
professional services in each of the fiscal years ended December 31, 2006 and
2005.
YEAR ENDED DECEMBER 31, 2006
TOTAL MHK RSSM
---------- ---------- ----------
Audit fees (1) $ 63,900 $ 63,900 $ -
Audit related fees (2) 54,450 54,450 -
Tax fees (3) 31,650 31,650 -
All other fees (4) - - -
---------- ---------- ----------
Total $ 150,000 $ 150,000 $ -
========== ========== ==========
YEAR ENDED DECEMBER 31, 2005
Audit fees (1) $ 51,154 $ 51,154 $ -
Audit related fees (2) 37,356 33,856 3,500
Tax fees (3) 14,001 14,001 -
All other fees (4) 1,614 1,614 -
---------- ---------- ----------
Total $ 104,125 $ 100,625 $ 3,500
========== ========== ==========
(1) Audit fees consisted principally of audit work performed on the
consolidated financial statements, as well as work generally only the
independent auditor can reasonably be expected to provide.
(2) Audit related fees consisted of work performed in the review of the
Company's quarterly consolidated financial statements.
(3) Tax fees consisted of tax compliance and reporting services.
(4) The Company generally does not engage its outside auditors for "other"
services.
The Audit Committee of the Company's Board of Directors considered whether the
provision of non-audit services by the independent public accountants was
compatible with maintaining the accountants' independence and they determined
that it was.
14
The Audit Committee has a policy requiring pre-approval of audit and non-audit
services. The Audit Committee of the Company's Board of Directors considers each
engagement of the independent auditor on a case-by-case basis. In determining
engagements to be performed by independent auditors, the Audit Committee
determines if these services would impair the independence of the auditors and
if these services are in the best interest of the Company. The Audit Committee
approved all audit and non-audit services provided by MHK during the fiscal year
ended December 31, 2006.
It is expected that a representative of MHK will be present at the Annual
Meeting with the opportunity to make a statement if such representative so
desires and to respond to appropriate questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION OF
THE APPOINTMENT OF MARDEN, HARRISON & KREUTER, CPAS, P.C. AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2007.
OTHER MATTERS
As of the date of this Proxy Statement, the Company knows of no other matter to
be submitted at the meeting. If any other matters properly come before the
meeting, it is the intention of the persons named in the enclosed form of Proxy
to vote the proxy on such matters in accordance with their judgment.
STOCKHOLDER PROPOSALS FOR 2008 ANNUAL MEETING
Stockholder proposals to be presented at the 2008 Annual Meeting must be
received by the Company on or before December 12, 2007 for inclusion in the
proxy statement and proxy card relating to the 2008 Annual Meeting pursuant to
SEC Rule 14a-8. Any such proposals should be sent via registered, certified or
express mail to: Director of Investor Relations, KSW, Inc., 37-16 23rd Street,
Long Island City, New York 11101.
As a separate and distinct matter from proposals under Rule 14a-8, the Company's
By-Laws provide that in order for business to be properly brought before the
next Annual Meeting by a stockholder, such stockholder must deliver timely
notice thereof. To be timely, a stockholder introducing a proposal at an Annual
Meeting must notify the Company of such intention not less than 60 days prior to
the date of the Annual Meeting. If the Company has given less than 75 days
public notice of the date of the Annual Meeting, the stockholder must give such
notice so that it is received by the Company not later than 10 days after the
public notice is given or the Proxy Statement is mailed. The stockholder's
notice must give the information specified in the By-Laws, including information
about the stockholder making the proposal, the number of shares such stockholder
owns and any interest such stockholder may have in the subject of the proposal.
If such stockholder will be nominating persons for election as Directors,
certain information specified in the By-Laws must also be given about the
nominee and the nominee's interest in the Company.
Dated: April 3, 2007
By order of the Board of Directors
James F. Oliviero
General Counsel
Please remember to mark, sign, date and return the enclosed Proxy Card in the
enclosed postage-paid envelope so that your important vote will be counted at
the Annual Meeting.
15
APPENDIX A
SUMMARY COMPENSATION TABLE
CHANGE IN
PENSION
VALUE AND
NON-EQUITY NONQUALIFIED
INCENTIVE DEFERRED
STOCK OPTION PLAN COMPENSATION ALL OTHER
NAME AND SALARY BONUS AWARDS AWARDS COMPENSATION EARNINGS COMPENSATION TOTAL
PRINCIPAL POSITION YEAR ($) ($) ($) ($) ($) ($) ($) ($)
(a) (b) (c) (d) (e) (f) (g) (h) (i)(3) (j)
- --------------------- ------- ------- ------- ------- ------- ------------ ------------ ------------ ----------
FLOYD WARKOL 2006 450,000 50,000(1) -- -- 569,957(2) -- 39,100(4) 1,109,057
RICHARD W. LUCAS 2006 130,000 25,000 -- -- -- -- 3,750 158,750
VINCENT TERRAFERMA 2006 180,000 75,000 -- -- -- -- 5,000 260,000
JAMES F. OLIVIERO 2006 175,000 35,000 -- -- -- -- 5,000 215,000
(1) Amount consists of a performance bonus based on 2005 financial results
awarded to Mr. Warkol in 2006.
(2) Amounts consist of the bonus earned by Mr. Warkol pursuant to his
employment agreement.
(3) Unless otherwise indicated, the amounts in this column consist of 401K
matching contributions made by the Company.
(4) This amount consists of (a) approximately $3,600 related to an insurance
policy, (b) $30,500 related to the personal portion of expenses for the use
of a car and a driver and (c) a $5,000 401K matching contribution made by
the Company
16
APPENDIX B
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2006
OPTION AWARDS STOCK AWARDS
-------------------------------------------------------------- ---------------------------------------------
EQUITY
INCENTIVE
EQUITY PLAN
INCENTIVE AWARDS:
EQUITY PLAN MARKET OR
INCENTIVE AWARDS: PAYOUT
PLAN NUMBER OF VALUE OF
AWARDS: NUMBER OF MARKET UNEARNED UNEARNED
NUMBER OF NUMBER OF NUMBER OF SHARES VALUE SHARES, SHARES,
SECURITIES SECURITIES SECURITIES OR UNITS OF SHARES UNITS UNITS
UNDERLYING UNDERLYING UNDERLYING OF STOCK OR UNITS OR OTHER OR OTHER
UNEXERCISED UNEXERCISED UNEXERCISED OPTION THAT OF STOCK RIGHTS RIGHTS
OPTIONS OPTIONS UNEARNED EXERCISE OPTION HAVE NOT THAT HAVE THAT HAVE THAT HAVE
(#) (#) OPTIONS PRICE EXPIRATION VESTED NOT VESTED NOT VESTED NOT VESTED
NAME EXERCISABLE UNEXERCISABLE (#) ($) DATE (#) ($) (#) ($)
(a) (b) (c) (d) (e) (f) (g) (h) (i) (j)
- ------------------ ----------- ------------- ----------- -------- ---------- --------- ---------- ---------- ----------
FLOYD WARKOL 225,000 -- -- 1.66 12/15/10 -- -- -- --
RICHARD W. LUCAS 6,667 13,333(1) -- 1.66 08/08/15 -- -- -- --
VINCENT TERRAFERMA 6,667 -- -- 1.66 12/15/10 -- -- -- --
JAMES F. OLIVIERO -- -- -- -- -- -- -- -- --
(1) This option was granted August 8, 2005. Assuming continued employment with
the Company, 6,667 shares will become exercisable on August 8, 2007 and the
remaining on August 8, 2008.
17
APPENDIX C
OPTION EXERCISES AND STOCK VESTED DURING 2006
OPTION AWARDS STOCK AWARDS
------------------------------------- -------------------------------------
NUMBER OF SHARES VALUE REALIZED NUMBER OF SHARES VALUE REALIZED
ACQUIRED ON EXERCISE ON EXERCISE ACQUIRED ON VESTING ON VESTING
NAME (#) ($) (#) ($)
(a) (b) (c) (1) (d) (e)
- ------------------------- -------------------- -------------- ------------------- --------------
FLOYD WARKOL 2006 74,500 163,156 -- --
RICHARD W. LUCAS 2006 -- -- -- --
VINCENT TERRAFERMA 2006 -- -- -- --
JAMES F. OLIVIERO 2006 20,000 43,800 -- --
(1) The value realized equals the difference between the option exercise price
and the fair value of the Company's common stock on the date of exercise,
multiplied by the number of shares for which the option was exercised.
18
APPENDIX D
DIRECTOR COMPENSATION
CHANGE IN
PENSION
FEES NON-EQUITY VALUE AND
EARNED OR INCENTIVE NONQUALIFIED
PAID STOCK PLAN DEFERRED ALL OTHER
IN CASH AWARDS COMPENSATION COMPENSATION COMPENSATION TOTAL
NAME ($) ($) ($) Earnings ($) ($)
(a) (b) (1) (c) (d) (e) (f) (2) (g)
- ------------------------- ---------- ------- --------------- --------------- --------------- ----------
RUSSELL MOLINA 2006 19,000 -- -- -- -- 19,000
STANLEY KREITMAN 2006 19,000 -- -- -- 51,800 70,800
INNIS O'ROURKE 2006 19,000 -- -- -- -- 19,000
JOHN A. CAVANAGH 2006 19,000 -- -- -- 49,195 68,195
WARREN O. KOGAN 2006 9,933 -- -- -- -- 9,933
(1) During 2006, the Company paid its non-employee directors an annual fee of
$16,000, an attendance fee of $1,000 per meeting of the Board of Directors
and $500 per committee meeting if not held in conjunction with a meeting of
the Board of Directors. As of March 15, 2007, the fees for non-employee
directors are the same as for 2006. Mr. Kogan was appointed to the Board of
directors on March 10, 2006, and his fees are pro-rated.
(2) Amounts included above under the caption "all other compensation" represent
the exercise of stock options by Directors during the year. The value
realized equals the difference between the option exercise price and the
fair value of the Company's common stock on the date of exercise multiplied
by the number of shares for which the option was exercised.
The following schedule details the options outstanding for each Director as
of December 31, 2006.
NAME # OF OPTIONS OUTSTANDING # OF OPTIONS EXERCISABLE
- --------------------- ------------------------- ------------------------
RUSSELL MOLINA 20,000 20,000
STANLEY KREITMAN -- --
INNIS O'ROURKE 20,000 13,333
JOHN A. CAVANAGH 6,668 1
WARREN O. KOGAN -- --
19
APPENDIX E
KSW, INC.
COMPENSATION COMMITTEE CHARTER
ROLE
The compensation Committee's role is to discharge the Board's responsibilities
relating to compensation of the Company's executives and to oversee and advise
the Board on the adoption of policies that govern the Company's compensation and
benefit programs.
MEMBERSHIP
The membership of the Committee consists of at least three directors, each of
whom shall (a) meet the independence requirements, (b) be a "non-employee
director" within the meaning of Rule 16b-3 under the Securities Exchange Act of
1934, and (c) be an "outside director" within the meaning of Section 162(m) of
the Internal Revenue Code. The Board appoints the members of the Committee and
the chairperson. The Board may remove any member from the Committee at any time
with or without cause.
OPERATIONS
The Committee meets at least two times a year. Additional meetings may occur as
the Committee or its chair deems advisable. The Committee will meet periodically
in executive session without Company management present. The Committee will
cause to be kept adequate minutes of its proceedings, and will report on its
actions and activities at the next quarterly meeting of the Board. Committee
members will be furnished with copies of the minutes of each meeting and any
action taken by unanimous consent. The Committee is governed by the same rules
regarding meetings (including meetings by conference telephone or similar
comm8nications equipment), action without meetings, notice, waiver of notice,
and quorum and voting requirements as are applicable to the Board. The Committee
is authorized to adopt its own rules of procedure not inconsistent with (a) any
provision of this Charter, (b) any provision of the Bylaws of the Company, or
(c) the laws of the state of Delaware.
AUTHORITY
The Committee will have the resources and authority necessary to discharge its
duties and responsibilities. The Committee has sole authority to retain and
terminate compensation consultants, or other experts or consultants, as it deems
appropriate, at the Company's expense, including sole authority to approve the
fees and other retention terms for such persons. Any communications between the
Committee and legal counsel in the course of obtaining legal advice will be
considered privileged communications of the Company, and the Committee will take
all necessary steps to preserve the privileged nature of those communications.
20
Except as otherwise delegated by the Board or the Committee, the Committee will
act on behalf of the Board. The Committee will serve as the "Committee"
established to administer equity-based and employee benefit plans, and as such
will discharge any responsibilities imposed on the Committee under those plans,
including making and authorizing grants, in accordance with the terms of those
plans. The Committee may delegate to the Chief Executive Officer the authority
to set the compensation structure and make grants of stock options and stock
awards to eligible individuals. The Chief Executive shall report to the
Committee when he sets the compensation of any individuals or makes any grants
of stock options or awards. The Committee may revoke any such delegation of
authority at any time.
RESPONSIBILITIES
The principal responsibilities and functions of the Compensation Committee are
as follows:
1. Review the competitiveness of the Company's executive compensation
programs to ensure (a) the attraction and retention of executives, (b)
the motivation of executives to achieve the Company's business
objectives, and (c) the alignment of the interests of key leadership
with the long-term interests of the Company's shareholders.
2. Review trends in executive compensation, oversee the development of
new compensation plans, and, when necessary, approve the revision of
existing plans.
3. Review and approve the compensation structure for the Chief Executive
Officer.
4. Delegate to the Chief Executive Officer the responsibility to set the
compensation of other executives.
5. Review and discuss with the Board plans for executive officer
development and corporate succession plans for the CEO and other
executive officers.
6. Review and make recommendations concerning long-term incentive
compensation plans, including the use of equity-based plans.
7. Periodically review the compensation paid to non-employee directors
and make recommendations to the Board for any adjustments. No member
of the Committee will act to fix his or her own compensation except
for uniform compensation to directors for their services as a
director.
8. Review reports from management on matters relating to the Company's
compensation practices.
9. Produce an annual report of the Compensation Committee on executive
compensation for the Company's annual proxy statement in compliance
with and to the extent required by applicable Securities and Exchange
Commission rules and regulations and relevant listing authority.
10. Review and discuss with management the Compensation Discussion and
Analysis to be included in the Company's annual proxy statement.
22
ANNUAL MEETING OF STOCKHOLDERS OF
KSW, INC.
MAY 8, 2007
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
Please detach along perforated line and mail in the envelope provided.
- ------------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSAL 2.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
- ------------------------------------------------------------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
1. ELECTION OF DIRECTORS: A vote for election of the 2. APPOINTMENT OF INDEPENDENT AUDITORS. [ ] [ ] [ ]
following nominees. The ratification of the appointment
of Marden, Harrison & Kreuter,
NOMINEES: CPAs, P.C.
[ ] FOR ALL NOMINEES o Floyd Warkol
o Warren O. Kogan 3. In their discretion, upon any other matters which may properly
[ ] WITHHOLD AUTHORITY come before the meeting or any adjournment thereof.
FOR ALL NOMINEES
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
[ ] FOR ALL EXCEPT DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION
(See instructions below) IS MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEES LISTED IN
PROPOSAL 1 AND FOR PROPOSAL 2.
Receipt of the Notice of Annual Meeting and Proxy Statement of
the Company preceding or accompanying the same is hereby
acknowledged.
INSTRUCTION: To withhold authority to vote for any individual PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE
nominee(s), mark "FOR ALL EXCEPT" and fill in the ENCLOSED ENVELOPE.
circle next to each nominee you wish to withhold,
as shown here: [X]
- --------------------------------------------------------------
- --------------------------------------------------------------
To change the address on your account, please check the
box at right and indicate your new address in the [ ]
address space above. Please note that changes to the
registered name(s) on the account may not be submitted
via this method.
- --------------------------------------------------------------
Signature of Stockholder Date: Signature of Stockholder Date:
--------------------- ----------- --------------------- -----------
NOTE: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign.
When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer
is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a
partnership, please sign in partnership name by authorized person.
PROXY
KSW, INC.
ANNUAL MEETING OF STOCKHOLDERS
MAY 8, 2007
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints James Oliviero and Richard Lucas, each
of them, proxies, with full power of substitution, to vote all shares of KSW,
INC. which the undersigned is entitled to vote at the Company's Annual Meeting
to be held at the American Stock Exchange, 16 Trinity Place, N.Y. 10006, on
May 8, 2007 at 2:00 p.m., New York time, and at any adjournment thereof, hereby
ratifying all that said proxies or their substitutes may do by virtue hereof,
and the undersigned authorizes and instructs said proxies to vote as follows:
(TO BE CONTINUED AND SIGNED ON THE OTHER SIDE)