sec info - gyrodyne co of america inc - pre 14a - for 4/30/99
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gyrodyne co of america inc · pre 14a · for 4/30/99
filed on 10/15/99 · sec file 0-01684 · accession number 44689-99-5
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10/15/99 gyrodyne co of america inc pre 14a 4/30/99 1:27
preliminary proxy solicitation material · schedule 14afiling table of contents
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gyrodyne company of america, inc.
7 flowerfield, suite 28
saint james, new york 11780
notice of annual meeting
of shareholders
to be held on
november 16, 1999
to the shareholders of gyrodyne company of america,
inc.
notice is hereby given, pursuant to the bylaws, that the annual
meeting of shareholders (the "annual meeting") of gyrodyne company of america,
inc. (the "company"), will be held at flowerfield, mills pond road, saint
james, new york, on tuesday, november 16, 1999 at 11:00 o'clock in the forenoon,
eastern time.
the purpose of the annual meeting is to consider and vote
upon the following matters:
1. to elect one (1) director to a three year term of office,
and until his successor shall be elected and shall qualify;
2. to ratify engagement of holtz rubenstein & co., llp,
independent accountants as auditors of the company and its subsidiaries for
the fiscal year ending april 30, 2000;
3. to consider and act upon five shareholder proposals, if
introduced at the meeting, as described in the attached proxy statement;
and
4. to transact such other business as may properly come before
the annual meeting or any adjournment thereof.
the foregoing items of business are more fully described in
the proxy statement accompanying this notice. by order of the board of directors,
only shareholders of record at the close of business october 8, 1999 are
entitled to notice of and to vote at the annual meeting, or any adjournment
thereof. enclosed in this mailing are the notice of
1999 annual meeting of shareholders, proxy statement, proxy card and attendance
registration.
to obtain an admittance card for the meeting, please complete
the enclosed attendance registration form and return it with your proxy card.
if your shares are held by a bank or broker, you may obtain an admittance
card by returning the attendance registration form they forwarded to you.
if you do not receive an attendance registration form, you may obtain an
admittance card by sending a written request, accompanied by proof of share
ownership to the undersigned. for your convenience, we recommend that you
bring your admittance card to the annual meeting so you can avoid registration
and proceed directly to the meeting. however, if you do not have an admittance
card by the time of the meeting, please bring proof of share ownership to
the registration area where our staff will assist you.
by order of the board of directors,
peter pitsiokos, corporate secretary
october 15, 1999
your vote is important
all shareholders are cordially invited to attend the meeting
in person. however, we encourage you to sign, date and promptly return the
proxy in the enclosed envelope, regardless of whether you plan to attend
the meeting. giving your proxy will not affect your right to vote in person
if you attend the meeting, but will help assure a quorum and avoid further
proxy solicitation costs. attendance at the annual meeting is limited to
shareholders, their proxies and invited guests of the company. for identification
purposes, "street name" shareholders will need to bring a copy of a brokerage
statement reflecting stock ownership as of the record date.
proxy statement
annual meeting of shareholders
in general
this proxy statement is furnished
in connection with the solicitation of proxies by the board of directors
(the "board") of gyrodyne company of america, inc. ( the "company") for use
at the annual meeting of shareholders (the "annual meeting") to be held november
16, 1999 at 11:00 a.m., eastern time at flowerfield, mills pond road, saint
james, new york 11780 and at any and all adjournments thereof.
voting securities and proxies
the board has fixed the close of business on october 8, 1999,
as the record date for the determination of shareholders entitled to notice
of, and to vote at, the annual meeting. the securities which may be voted
at the annual meeting consist of shares of common stock of the company. holders
of common stock are entitled to one vote per share. shareholders do not have
cumulative voting rights. it is necessary for a quorum that record holders
of a majority of the shares be represented by proxy or in person at the annual
meeting. the number of shares of common stock outstanding on the record date
was 1,107,143. this proxy statement and the enclosed proxy card were mailed
commencing on or about october 15, 1999.
proxies solicited by the board will be voted in accordance
with the instructions given therein. where no instructions are indicated,
proxies will be voted "for" the election of the nominee for
director, "for" ratification of the appointment of the independent auditor
and "against" each of the shareholder proposals described herein, if introduced
at the meeting. if you do not return your duly signed proxy card,
your shares cannot be voted unless you attend the annual meeting and vote
in person or present a duly signed proxy at the annual meeting.
principal shareholders
the following table sets forth as of
october 8, 1999 those persons or entities known by the company to be beneficial
owners of more than 5% of the company's common stock $1 pv, its only equity
security.
name and address
type of
ownership
number of
shares owned
percent of
class
catherine papadakos
village of the green
2481-c oakleaf lane
clearwater, fl 33763-1236
beneficial
116,639
10.54
peter p. papadakos
p.o. box 3838
reno, nevada 89505
beneficial
86,374
7.80
gyrodyne company of america,
inc.
st. james, ny 11780 (a)
beneficial
78,346
7.08
private capital management,
inc.
3003 tamiami trail north
naples, florida 33940
beneficial
66,866
6.04
k capital partners, llc
441 stuart street, 6th floor
boston, massachusetts 02116
beneficial
55,996
5.06
(a) since the company has the authority to direct the hsbc
bank, usa, the trustee of the gyrodyne pension plan, to vote the securities
of the company held by the pension fund, gyrodyne company of america, inc.
has been listed above as the beneficial owner of the 78,346 shares held by
the hsbc bank, usa as trustee for the gyrodyne pension fund. the board of
directors intends to instruct the trustees of the pension fund to vote
"for" the election of the nominee for director, "for" ratification
of the appointment of the independent auditor and "against" each of the
shareholder proposals described herein, if introduced at the
meeting.
election of directors
(proposal 1)
the by-laws of the company provide that there shall be not
less than three (3), nor more than nineteen (19) directors. the number of
directors of the company is presently fixed by resolution of the board of
directors at seven (7). there are three (3) classes of directors serving
staggered terms of office with each class to consist, as nearly as possible,
of one-third of the total number of directors constituting the entire board
of directors. upon the expiration of the term of office for a class of directors,
the nominees for that class are elected for a three (3) year term to serve
until the election and qualification of their successors. each properly executed
proxy received will be voted for the election of the one (1) nominee named
below as director to serve until the designated annual meeting of shareholders
shown below or until his respective successor shall be elected and shall
qualify. the nominee has consented to be named as a nominee in the proxy
statement and to serve as a director if elected.
should any nominee become unable or unwilling to accept a
nomination or election, the persons named in the enclosed proxy will vote
for the election of a nominee designated by the board.
following is the nominee who is currently a director of the
company. he was elected to his current term of office at the 1996 annual
meeting of shareholders. information concerning the nominee, showing the
year when first elected as a director of the company, the age, principal
occupation and principal affiliations, is as follows:
nominee for director - term expiring in 2002
robert h. beyer
director since 1977
age 66
consultant, retired naval air systems command engineer, retired captain,
united states naval reserve, retired technical representative for the company's
helicopter subsidiary. member of executive compensation, nominating, stock
incentive and special aerospace committees.
the board of directors recommends that shareholders vote
"for" the nominee for director. this is identified
as item 1 on the enclosed proxy card.
security ownership of directors,
executive officers and nominees
the following table sets forth as of october 15, 1999 the
outstanding voting securities beneficially owned by the directors and executive
officers and the number of shares owned by directors and executive officers
as a group.
name & positions with
the company
shares of stock beneficially owned
percentage
of
common stock
owned
stephen v. maroney,
president, ceo, treasurer and director
13,272
1.20 %
peter pitsiokos,
exec. vice president, secretary & general counsel
9,756
(a)
(b)
josef markowski
vice president, operations
1,799
(b)
robert h. beyer,
director
4,612
(c)
(b)
robert f. friemann, director
1,801
(b)
nicholas t. goudes,
director
7,341
(b)
paul l. lamb, chairman
of the board of directors
7,702
(d)
(b)
john h. marburger
iii, director
2,742
(b)
philip f. palmedo,
director
6,406
(b)
all directors and
executive
officers as a group
nine (9) persons
55,431
5.01%
(a) does not include his wife's and minor children's ownership
of 447 shares in which he denies any beneficial interest.
(b) less than 1%.
(c) does not include his wife's ownership of 1,638 shares in which he denies
any beneficial interest.
(d) includes 6,294 shares of company stock held by lamb & barnosky, llp
profit sharing trust and 535 shares held by lamb & barnosky, llp. mr.
lamb is a trustee of the lamb & barnosky, llp profit sharing trust
and a partner in lamb & barnosky, llp.
director compensation
directors who are full-time salaried employees of the company are not compensated
for their service on the board or any committee. non-employee directors are
paid an annual fee of $7,500.00, $1,000.00 for each director's meeting attended,
$500.00 for each committee meeting attended and travel and lodging expenses
where appropriate. all compensation is paid in stock. during
fiscal year 1999, director stephen v. maroney was paid compensation of $76,135
in his capacity as director of real estate development. mr. maroney's
compensation as director of real estate development ceased upon his appointment
as president, ceo and treasurer of the company. there
was no additional compensation paid by the company to any other director
for fiscal years 1998 or 1999.
non-employee director's compensation plan and stock
option plan
the non-employee director's compensation plan (the "compensation plan"),
approved by the shareholders in 1996, allows outside directors to elect to
receive all of their annual director's fees and meeting fees in shares of
the company's common stock. since the inception of the compensation plan,
all directors have elected to receive all of their annual director's fees
and meeting fees in shares of the company's common stock. the compensation
plan is administered by the non-employee director's compensation plan
committee. the following individuals, who are not eligible
to participate in the compensation plan, serve on the committee: stephen
v. maroney, chairman, frank d'alessandro, peter pitsiokos. the committee
did not meet in fiscal year 1999. the compensation plan terminates in february
2000.
the shareholders also adopted a non-qualified stock option
plan for all non-employee directors of the company in 1996. each non-employee
director was given initial option grants when the plan was adopted, which
are exercisable in three equal annual installments commencing on the first
anniversary of the grant. each non-employee director will also be given 1,250
option grants which will be granted on january 1 for each calendar year 1997
through 2000. each option is exercisable on the first anniversary of the
grant.
number
of shares
option
prices
total options outstanding at
april 30, 1997
26,250
$11.80 - $11.82
initial stock option grants
5,000
$11.82 - $21.01
annual stock option grants
12,500
$19.98
total options exercised
(3,750)
$11.80 - $11.82
total options outstanding at
april 30, 1998
40,000
$11.80 - $21.01
initial stock option grants
2,500
$15.34
annual stock option grants
10,000
$14.81
total options exercised
(408)
$11.80
total options canceled
(1,250)
$19.98
total options outstanding at
april 30, 1999
50,842
$11.80 - $21.01
shares reserved for future issuance at april 30, 1999 are
comprised of the following:
shares
issuable upon exercise of stock options under the company's non-employee
director stock option plan
70,842
shares issuable
under the company's non-employee director stock compensation plan
27,715
shares issuable
upon exercise of stock options under the company's stock incentive plan
227,412
shares issuable
under the company's stock grant incentive plan
9,100
335,069
interest of directors in transactions with the company
mr. paul l. lamb, chairman of the board of directors, is a partner in the
law firm of lamb & barnosky, llp, formerly known as cahn wishod &
lamb, llp, which performs legal services for the company and is paid its
usual and customary fees for those services. in fiscal year 1999, total fees
paid to lamb & barnosky, llp were $27,511, paid 50% in
cash and 50% in restricted company stock.
board meetings, committees and membership
attendance
there were four regular meetings
and one special meeting of
the
board of directors during
fiscal year 1999 (may 1, 1998 through april 30, 1999). each director attended
75% of the aggregate number of meetings of the board of directors of the
company, except for mr. goudes.
committees
the committees consist of the audit committee, executive committee, executive
compensation committee, nominating committee and stock option committee.
the executive committee consists
of four non-employee members and mr. maroney. directors presently serving
on the executive committee include mr. lamb (chairman), mr. friemann, mr.
marburger, mr. maroney and mr. palmedo. the executive committee exercises
all the authority of the board of directors in the management and business
affairs of the company during the intervals between meetings of the board
except with respect to certain matters that by statute may not be delegated
by the board of directors. the committee met five times during fy 1999.
the audit committee consists
entirely of non-employee directors and is primarily concerned with the
effectiveness of the company's accounting policies and practices, financial
reporting and internal controls. specifically, the committee recommends to
the board the firm to be appointed as the company's independent accountants
subject to ratification by the shareholders; approval of the scope of the
accountants' examination; review of financial statements, including auditors'
opinions and management letters and reporting to the board the committee's
recommendation with respect thereto; review of financial and/or fiscal policies
and policy decisions; monitoring of internal programs to ensure compliance
with laws, regulations and the company's responsibilities for financial reporting
to the public. the committee met twice during fy 1999 and its members were
mr. friemann, mr. lamb and mr. maroney. (current members: mr. friemann, mr.
lamb, mr. palmedo)
the executive compensation committee
consists entirely of non-employee directors and oversees the company's
compensation and benefit policies and programs. it recommends to the board
annual salaries, bonuses and other benefits for elected officers and certain
key executives. the committee met two times in fy 1999 and its members were
mr. beyer, mr. marburger and mr. palmedo.
(current members: mr. beyer and mr. friemann)
the nominating committee consists
entirely of non-employee directors and recommends guidelines to the board
regarding the size and composition of the board and criteria for the selection
of nominees. it also recommends the slate of director nominees to be included
in the proxy statement and recommends candidates for vacancies which may
occur. the committee met one time during fy 1999 and its members were mr.
beyer, mr. goudes and mr. d. papadakos. (current members: mr. beyer, mr.
goudes, mr. lamb)
the stock option committee consists
entirely of non-employee directors. the primary functions of the stock option
committee include the review and administration of employee stock option
plans for the benefit of officers and key employees. it also recommends to
the board stock options and awards. the committee met one time during fy
1999 and its members were mr. friemann, mr. marburger, mr. p. papadakos.
(current members: mr. beyer and mr. friemann)
compliance with section 16(a) of the securities exchange
act of 1934
a review of all forms 3 and 4 filed with the company indicates
that none of the executive officers or directors were late in filing any
required forms 3 or forms 4 with the securities and exchange commission for
fiscal year 1999. a review of prior year filings indicates that no 10% holder
of gyrodyne common stock $1 p.v. failed to file timely reports.
committee report on executive compensation
the company's executive compensation program is administered by the executive
compensation committee of the board. the committee reviews and considers
recommendations of management and then determines compensation of executive
officers. the committee's recommendations are reviewed with the board's
non-employee directors.
the goal of the company's executive compensation committee is to ensure that
an appropriate relationship exists between executive compensation and the
creation of shareholder value, while at the same time motivating and retaining
key employees. salary guidelines for executive officers are established by
comparing responsibilities of the position to similar positions in other
comparable companies. the company has long believed in the importance of
aligning the interests of executives and shareholders through stock ownership
by key employees. the primary components of compensation, base salary and
stock option awards are designed to accomplish the committee's goals.
the committee evaluates management based on the company's financial and
non-financial performance recognizing that land and property management
constitute the major portion of the company's business activities.
comparisons of the company's compensation levels with those of similar land
management and property rental organizations are extremely limited and primarily
based on estimates since most are privately owned and not required to make
public disclosures. in light of these estimations, it is the committee's
opinion that the company's level of overall compensation is competitive and
in the low to mid range on a comparative basis.
it is the position of both these committees that management's performance
can best be evaluated based on its ability to formulate, oversee and administer
corporate strategy, which itself is the product of board action and direction.
for the foreseeable future, that strategy is to focus primarily on continued
progress in the real estate operation, principally the development of
flowerfield.
in establishing the compensation for messrs. maroney and pitsiokos, the committee
observes the policy set forth above for executive officers. no specific weighting
is applied to the various factors in determining the chief executive officer's
compensation.
members of the committee
philip f. palmedo, chairman
john h. marburger iii
robert h. beyer
employment contracts, other compensation and certain
transactions
the company has a one year employment agreement with mr. maroney, who was
director of real estate development since 1996 and was subsequently appointed
president, chief executive officer and treasurer of the company. the employment
contract provides for an annual base salary of $175,000.00. in connection
with the company's appointment of mr. pitsiokos as executive vice president,
general counsel and secretary, the company also entered into a one year
employment contract with peter pitsiokos for an annual base salary of
$115,000.08. both contracts provide for a severance payment equivalent to
six months salary in the event of a change in control.
during the fiscal year ended april 30, 1999 two directors
or officers received remuneration in excess of $100,000 in such
capacity.
summary compensation table
annual compensation
long term compensation
annual compensation
awards
pay outs
name and principal
position
year
salary ($)
bonus ($)
other annual
compensation ($)
restricted stock
award ($)
securities
underlying options/ lsars (#)
ltip payout
($)
all other
compensation
stephen v.
maroney
president &
ceo
1999
20,856
0
0
0
0
0
0
dir.of real estate
devlp
1999
76,135
0
59,500 (a)
0
1,250
0
0
dir.of real estate
devlp
1998
80,000
0
60,500 (a)
0
4,250
0
0
dimitri p.
papadakos
1999
111,536
0
45,039 (b)
0
0
0
0
former president
& ceo
1998
123,312
0
60,239 (b)
0
0
0
0
(a) pursuant to his consulting agreement with the company, mr. maroney received
stock payments in lieu of cash with a fair market value of $45,000 in fy99
and $45,000 in fy98. mr. maroney also received shares for his services as
company director with a fair market value of $14,500 in fy99 and $15,500
in fy98. the registrant has concluded that the aggregate amounts of personal
benefits to any of the current executives does not exceed the lesser of $50,000
or 10% of compensation and bonuses reported above for the named executive
officers, and that the information set forth in tabular form above is not
rendered materially misleading by virtue of the omission of such personal
benefits.
(b) the 1999 and 1998 "other annual compensation" represents the difference
between the fair market value and the option price on the date of grant for
4,375 and 7,157 shares exercised.
1993 stock incentive plan
in 1993, the shareholders adopted a stock incentive plan (the
"plan") under which participants may be granted incentive stock options ("isos"),
non-qualified stock options ("nqsos") or stock grants. the purpose of the
plan is to promote the overall financial objectives of the company and its
shareholders by motivating those persons selected to participate in the plan
to achieve growth in shareholder value and retain the association of those
individuals who are instrumental in achieving this growth. such options or
grants become exercisable at various intervals based upon vesting schedules
as determined by the stock option committee. the options expire between
august 1999 through august 2001.
the isos may be granted to employees and consultants of the
company at a price not less than the fair market value on the date of grant.
all such options are authorized and approved by the board of directors, based
on recommendations of the stock option committee.
isos may be granted along with stock appreciation rights which
permit the holder to tender the option to the company in exchange for stock,
at no cost to the optionee, that represents the difference between the option
price and the fair market value on date of exercise. nqsos may be issued
with limited stock appreciation rights which are exercisable, for cash, in
the event of a change of control. in addition, an incentive kicker may be
provided for stock grants, isos and nqsos, which increases the number of
grants or options based on the market price of the shares at exercise versus
the option price. a reload feature may also be attached which permits the
optionee to tender previously purchased stock, in lieu of cash, for the purchase
of the options and receive additional options equal to the number of shares
tendered.
information as to the stock options and stock grants is summarized
as follows:
stock
stock
stock options and
grants:
options
grants
total
available at april 30, 1997
43,496
3,855
47,351
stock grants awarded
-
7,455
7,455
stock options issued at $9.89
to $19.61 per share
45,657
-
45,657
stock grants exercised
-
(5,460)
(5,460)
stock options exercised at $9.89
per share
(16,491)
-
(16,491)
available at april 30, 1998
72,662
5,850
78,512
stock grants canceled
-
(300)
(300)
stock options canceled
(38,925)
-
(38,925)
stock options issued at $9.89
to $20.19 per share
8,750
-
8,750
stock grants exercised
-
(2,625)
(2,625)
stock options exercised at $9.89
per share
(8,750)
-
(8,750)
available at april 30, 1999
33,737
2,925
36,662
exercisable at april 30,
1999
24,012
600
24,612
there were no stock options or awards granted in fiscal year
1999.
on july 19, 1997, the board of directors granted stock options
or awards to twelve (12) key employees and officers totaling 32,000 shares,
no portion of which could be exercised or sold before july 19, 1998.
aggregated option/lsar exercised in last fiscal year
and fy-end option/lsar values
number of
securities
value of
unexercised
underlying
unexercised
in-the-money
shares
options/lsar's
at
options/lsar's
at
acquired on
value
april 30, 1999
april 30, 1999
($)
name
exercise
realized
exercisable/unexercisable
exercisable/unexercisable
stephen v. maroney
president and ceo
-
-
8,000/1,250
$7,975/$0
dimitri p. papadakos former
president & ceo
4375
$45,039
the weighted-average grant-date fair value of options granted
for the year ended april 30, 1999 and 1998 was $14.97 and $17.15, respectively.
in addition, there were 60,687 options at a weighted-average per share exercise
price of $14.40 per option exercisable at april 30, 1999. the weighted-average
exercise price and remaining contractual life of options outstanding at april
30, 1999 is $14.89 and 3.8 years, respectively.
ratification of appointment
of independent auditors
(proposal 2)
the board of directors, upon the recommendation of the audit
committee, comprised entirely of outside directors, has appointed holtz
rubenstein & co., llp ("hr") of 125 baylis road, melville, new york 11747,
as independent public accountants of the company and its subsidiaries for
the current fiscal year, and to perform such other professional services,
if any, as may be required of them. the appointment of hr has been ratified
by the shareholders every year since 1990. the board is requesting ratification
of hr as independent public accountants. this firm has no financial interest
in the company or any connection with the company other than as auditors
and independent public accountants.
in the event the proposal is defeated, the adverse vote will
be considered a direction to the board to select other independent public
accountants for the next fiscal year. however, because of the expense and
difficulty of making any substitution of independent public accountants after
the beginning of a fiscal period, it is contemplated that the appointment
for 1999 will be permitted to stand unless the board finds other reasons
for making the change.
representatives of hr are expected to be present at the annual
shareholders meeting, will be given an opportunity to make a statement if
they desire to do so, and are expected to be available at a designated time
during the meeting to respond to appropriate questions.
the board of directors unanimously recommends a vote "for"
this proposal. this is identified as item 2
on the enclosed proxy card.
shareholders' proposals
(proposal 3)
peter j. papadakos, jr., 101 flowerfield, saint james, new york 11780, record
holder of at least $2,500.00 of market value of shares of common stock, has
given notice that he will introduce the following resolution and supporting
statement at the annual meeting:
the company has stated in several reports to the shareholders that its primary
focus is the development of its realty asset known as flowerfield in saint
james, new york. in the event the board of directors elects to depart from
the development plans, this proposal would require the board of directors
to seek shareholder approval for sale of any portion of the realty or the
company.
the company's primary business has been the management of its realty and
investment assets for over two decades. given the depressed price of the
company's common stock and in recognition of a tender offer made to shareholders
in 1999, at the unusual low price of "at market," it is likely that the company
will come under pressure to sell realty or to liquidate the company. this
proposal would require the board of directors to call a special meeting of
shareholders in order to approve any such sale or liquidation. this proposal
would also require, provided a quorum of fifty percent was reached, a
supermajority of sixty-six and two-thirds percent of the voted shares for
any such approval.
approval of the foregoing shareholder proposal requires the affirmative vote
of a majority of the votes cast thereon.
the board unanimously recommends a vote against this proponent's proposal
for the following reasons:
while the company's primary focus has been the development of its realty
assets, the principal objective of the board of directors is to maximize
shareholder value. both development of the company's real estate and maximization
of shareholder value may require that some portion or all of the company's
real property interests be sold. management must have the flexibility to
use the most effective means possible to consummate a transaction. depending
on the circumstances, the sale of the company's realty assets could involve
numerous transactions. proponent's proposal would require that the company's
board of directors bring each business transaction for the sale of any portion
of realty before a meeting of shareholders for approval. the preparation,
solicitation and distribution of the proxy statements required prior to each
such meeting would unnecessarily waste the company's monetary assets, cause
undue delays and potentially could diminish the return on shareholder equity.
furthermore, the requirement of a supermajority vote for shareholder approval
would permit holders of less than a majority of the outstanding shares to
block a transaction which is in the best interests of the company and which
is approved by a majority of the outstanding shares.
for the reasons set forth above, the board recommends a vote against
the proposal.
(proposal 4)
athena c. papadakos, 101 flowerfield, saint james, new york 11780, record
holder of at least $2,500.00 of market value of shares of common stock, has
given notice that she will introduce the following resolution and supporting
statement at the annual meeting:
shareholders have witnessed a precipitous decline in the value of the company's
common stock during a period of unparalleled growth in stock values. in order
to avoid paying the board in "cheap stock," this proposal would set a $20/share
minimum price applicable to converting fees earned by board members into
shares.
in an effort to better align themselves with the shareholders, the board
of directors has elected annually, at its option, to take its annual retainer,
meeting and committee fees in the form of company common stock. the company
stock slid from a high of over $21.00/share in mid-1998 to a low of under
$14.00/share in may 1999 while the equity markets have risen sharply, many
to historic highs. the company's common stock price has been traditionally
established at a discount of the imputed liquidation value of the company's
underlying assets. during the past year, the realty market on long island
has remained very firm.
in order to motivate the board of directors to maximize shareholder value
and thus spur stock appreciation, it is proposed that all remuneration paid
to the board of directors be memorialized by an immediate amendment to the
by-laws requiring that all remuneration of directors be solely in the company
common stock. and further, that a nominal minimum value be placed on that
stock of not less than $20/share or, if greater, the current market value
of the common stock as defined by an average five trading day interval concluding
with the end of the calendar month in which services were rendered. in addition,
dollar denominated fees payable to directors shall remain at the same dollar
value as currently in place, thus reducing dilution of shareholder equity
during times when the price is, as now, depressed.
the board unanimously recommends a vote against this proponent's proposal
for the following reasons:
at the 1996 annual meeting the shareholders voted overwhelmingly to adopt
(the non-employee directors' compensation plan) permitting the company to
compensate directors in shares of the company's common stock. the objective
of the plan, which expires by its terms in february 2000, was to align the
interests of directors with the long-term interests of the company and its
shareholders. while the board believes that the plan has helped to achieve
this objective, the board believes that under current market conditions
compensating directors in shares of the company's common stock will unnecessarily
dilute stock ownership and will no longer further the important objective
of helping the company attract and retain high caliber board members. shareholder
proposal 4, which would require that board members be compensated solely
in shares of the company's common stock and would arbitrarily place a value
on the shares for compensation purposes which could be less than their valuation
in the public market would thwart this objective by significantly reducing
the compensation of board members.
for the reasons set forth above, the board recommends a vote against
the proposal.
(proposal 5)
elias paraschos, 35 wiggins avenue, patchogue, new york 11772, record holder
of at least $2,500.00 of market value of shares of common stock, has given
notice that he will introduce the following resolution and supporting statement
at the annual meeting:
this proposal is to remove an anti-takeover measure that, if it remains in
place, would handicap any prospective bidder for the company thus reducing
the value of the company and adversely impacting shareholders.
institutional shareholder services, a highly regarded proxy analysis firm,
advises institutional clients not to support proposals for classified boards
of directors. classified boards of directors allow directors to be placed
into different categories with staggered terms thus precluding a majority
of directors from being elected in a single annual election. several years
ago, the company requested from the shareholders acceptance of a classified
board arrangement to insure enough time to execute the flowerfield property
development master plan. with the company's stock price depressed and the
board insulated from removal by the classified board system, it is proposed
that the classified board be abolished and all directors, effective after
the election of directors in 1999, be elected annually.
the board unanimously recommends a vote against this proponent's proposal
for the following reasons:
at the 1996 annual meeting, shareholders voted overwhelmingly to amend the
certificate of incorporation to provide for the current classified board
with staggered three-year terms. the proxy statement for that meeting contained
a detailed discussion recommending the classified board. a portion of that
discussion provided as follows:
"the board of directors believes that dividing the directors into three
classes is advantageous to the company and its shareholders because by providing
that directors will serve three-year terms rather than one-year terms, the
likelihood of continuity and stability in the policies formulated by the
board will be enhanced. the board also believes that the staggered election
of directors will promote continuity because, at any given time, at least
two-thirds of the directors will have at least one year of experience as
directors of the company...."
"the classified board may also discourage certain types of transactions...
which involve an actual or threatened change in control of the company without
sufficient benefit to all shareholders... the board of directors of the company
believes that in such situations, the imminent threat of removal of the company's
management would severely curtail management's ability to negotiate effectively
with any such third party acquirers. the board would be deprived of the time
and information necessary to evaluate the third party proposal, to seek out
and negotiate alternative proposals and to help ensure that the best result
is obtained for the shareholders in any transaction that may ultimately be
undertaken involving the company."
in the opinion of the board, the reasons set forth above are still valid
and the election of directors by classes should be continued.
for the reasons set forth above, the board recommends a vote against
the proposal.
(proposal 6)
harriet hanzakos, 804 michaux lane, grosse point shores, michigan 48236,
record holder of at least $2,500.00 of market value of shares of common stock
has given notice that she will introduce the following resolution and supporting
statement at the annual meeting:
in order to prevent conflict-of-interest issues for company directors and
officers, it is proposed that certain transactions be prohibited.
with approval of this proposal, the board of directors shall herewith be
required to amend the company's by-laws such that, in order to lessen the
possibility of a conflict-of-interest issue, the company shall be prohibited
from purchasing any goods or services from any proprietorship, partnership,
association, corporation or other organizational entity wherein a director
or corporate officer of the company is, directly or indirectly, also a principal
manager, officer, shareholder, partner or otherwise has a vested interest
in said entity.
the board unanimously recommends a vote against this proponent's proposal
for the following reasons:
the board of directors believes that the proposal, which appears to prohibit
transactions in which a manager, officer, director or shareholder has only
an insignificant interest, would seriously hamper the ability of management
to conduct the company's business and could prevent the consummation of
transactions which may be in the best interests of shareholders.
as drafted, the proponent's proposal could be interpreted to prohibit the
company from using at&t as it's long distance telephone service provider
if any member of the board of directors or management owned any shares of
at&t stock. this illustration demonstrates the degree to which management
would be severely impaired in carrying out even the most basic company activity
(i.e. use of company telephones) if the proponent's proposal were adopted.
for the reasons set forth above, the board recommends a vote against
the proposal.
(proposal 7)
nicholas xanthaky, 406 paradise road, apartment 2l, swampscott, massachusetts
01907, record holder of at least $2,500.00 of market value of shares of common
stock has given notice that he will introduce the following resolution and
supporting statement at the annual meeting:
in order to prevent a below market sale, swap or assignment of the company's
interest in the callery-judge grove, the company's second largest asset,
it is proposed that a minimum sales price be established.
according to the latest pinel & carpenter appraisal of the company's
second largest asset, the callery judge grove, the appraisal conducted for
the grove as a single operating entity, the company's pro rata partnership
interest in the grove was valued at $6,400,000. as noted in previous annual
reports, two equity offerings by the grove over the past four years have
established a defacto equity discount for the sale of additional equity at
a maximum 30% discount from appraised value resulting in a purchase price
of 70% of appraised value. with approval of this proposal, the board of directors
will be required to adopt a resolution that any sale, swap or assignment
of the company's interest in the grove can only be consummated at a price
not less than 60% of the appraised value as established for the fiscal year-end
appraisal immediately preceding the transaction.
the board unanimously recommends a vote against this proponent's proposal
for the following reasons:
the company currently owns numerous assets through which management is currently
seeking to maximize value for shareholders. to achieve that value and in
the conduct of the ordinary business of the company, management must have
the flexibility to use the most effective means available to consummate a
transaction relating to the callery-judge grove.
the board of directors believes that obstructing its ability to consider
all proposals it may receive with respect to the callery judge grove could
prevent it from accepting a proposal which, under changing market conditions,
would be in the best interests of the company and its shareholders. the board
of directors further believes that adopting a resolution fixing a minimum
sale price for an asset could hinder the company's management in negotiating
a fair price for the sale of the asset and that in any such sale the price
obtained will not be maximized by imposing binding restrictions based upon
a prior appraisal which may or may not reflect the fair value of the asset
at the time it is proposed to be sold.
for the reasons set forth above, the board recommends a vote against
the proposal.
other matters
management does not know of any other matters that may be
presented. if any other matters properly come before the annual meeting or
adjournments thereof, the persons named in the enclosed proxy will vote on
such matters in accordance with their best judgment pursuant to the discretionary
authority included in the proxy.
the cost of soliciting proxies will be paid by the company.
in addition to solicitation by mail, officers, directors, and regular employees
of the company may, without compensation other than their regular compensation,
solicit proxies by telephone, by fax or in person. brokerage houses and other
custodians, nominees and fiduciaries will be requested to forward solicitation
materials to their principals and the company will reimburse the expense
of so doing. in addition, kissel-blake, inc., a proxy solicitation firm,
will assist the company in soliciting proxies for the annual meeting and
will be paid a fee of $4,000 plus out-of-pocket expenses.
any shareholder executing the enclosed proxy has the right
to revoke it at any time prior to its exercise by delivering to the company
a written revocation or a duly executed proxy bearing a later date, or by
attending the annual meeting and voting in person. however, if you are a
shareholder whose shares are not registered in your own name, you will need
appropriate documentation from your record holder to attend the annual meeting
and to vote personally at the annual meeting.
financial
statements
accompanying this proxy statement is the annual report for
the latest fiscal year ended april 30, 1999 which includes an audited balance
sheet for the year then ended, and audited statements of income and cash
flow for each of the two most recent fiscal years.
1999 stockholder's
proposals
any shareholder's proposal intended to be presented at the
2000 annual meeting of shareholders must, in accordance with rule 14a-8 of
the proxy rules of the securities and exchange commission, be received at
the company's principal executive office on or prior to may 30, 2000, in
order to be included in the company's proxy statement and form of proxy relating
to such annual meeting.
dates referenced herein and documents incorporated by reference
this pre 14a filing date other filings4/30/9710ksb7/19/974/30/9810ksb5/1/987/19/98for the period ended4/30/9910ksb10/8/99filed on / filed as of10/15/9911/16/994/30/010ksb405/30/0 toplist all filings
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