UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
(Rule
14a-101)
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the
Securities
Exchange Act of 1934
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Preliminary Proxy
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Definitive Proxy
Statement
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Definitive Additional
Materials
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Soliciting Material Under Rule
14a-12
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AEROSONIC
CORPORATION
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(Name
of Registrant as Specified in its
Charter)
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AEROSONIC CORPORATION
(A
DELAWARE CORPORATION)
1212
North Hercules Avenue
Clearwater,
Florida 33765
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO
BE HELD ON JULY 15, 2010
TO
THE STOCKHOLDERS OF AEROSONIC CORPORATION:
The 2010
Annual Meeting of Stockholders of AEROSONIC CORPORATION will be held at Aerosonic Corporation, 1212 North
Hercules Avenue, Clearwater, Florida 33765, on Thursday, July, 15, 2010,
beginning at 10:00 A.M., EDT, for the following purposes:
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1.
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to elect one director to our
Board of Directors;
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2.
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to ratify the appointment of
Kirkland, Russ, Murphy & Tapp, P.A. as Aerosonic Corporation’s
independent registered public accounting firm for the fiscal year ending
January 31, 2011; and
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3.
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to transact such other business
as may properly come before the meeting or any adjournment or postponement
thereof.
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The
foregoing is more fully described in the proxy statement attached hereto and
made a part of this Notice. The Board of Directors has fixed the record date for
determining the stockholders entitled to notice of and to vote at the meeting
and any adjournment or postponement thereof as of the close of business on May
17, 2010.
A
complete list of the stockholders entitled to vote at the meeting shall be open
to inspection by any stockholder of Aerosonic Corporation, for any lawful
purpose germane to the meeting, at any time during usual business hours for a
period of ten days prior to the meeting at our offices located at 1212 North
Hercules Avenue, Clearwater, Florida 33765 (telephone number:
727.461.3000).
By Order
of the Board of Directors,
Douglas
J. Hillman,
President
& Chief Executive Officer
June 1,
2010
Clearwater,
Florida
YOUR
VOTE IS IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN. YOU ARE CORDIALLY
INVITED TO ATTEND THE MEETING IN PERSON. HOWEVER, WE ENCOURAGE YOU TO VOTE BY
PROXY SO THAT YOUR SHARES WILL BE REPRESENTED AND VOTED AT THE MEETING EVEN IF
YOU CANNOT ATTEND. PLEASE SIGN, DATE AND RETURN YOUR PROXY IN THE ENCLOSED
ENVELOPE. OF COURSE, YOU MAY VOTE IN PERSON AT THE MEETING IF YOU SO
CHOOSE.
Important
Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting
to be Held on July 15, 2010
The
Company’s proxy statement and annual report to stockholders for the fiscal year
2010 are available at www.aerosonic.com/annualreports.html
Directions
to attend the Annual Meeting and vote in person are available at www.aerosonic.com
AEROSONIC
CORPORATION
1212
North Hercules Avenue
Clearwater,
Florida 33765
PROXY
STATEMENT
Annual
Meeting of Stockholders to be held on July 15, 2010
GENERAL
INFORMATION
The
Notice of the Annual Meeting of Stockholders, this proxy statement and the
accompanying proxy card (the “proxy materials”) are being mailed to you
commencing on or about June 9, 2010 in connection with the solicitation of
proxies by the Board of Directors (the “Board”) of Aerosonic Corporation, a
Delaware corporation (“Aerosonic,” the “Company,” “we,” “us,” or “our”), to be
voted at the Annual Meeting of Stockholders to be held at Aerosonic Corporation,
1212 North Hercules Avenue, Clearwater, Florida 33765, beginning at 10:00 A.M.,
EDT, on Thursday, July 15, 2010. A copy of the Company’s Annual Report to
Stockholders for the fiscal year ended January 31, 2010 is being mailed with
these proxy materials.
All
proxies that are properly executed and delivered will be voted on all matters
that properly come before the meeting for a vote. If your proxy specifies
instructions with respect to the matters being voted upon, the proxy holders
will act in accordance with your instructions. If no instructions are specified,
your shares will be voted FOR
the election of the nominee to the Board, FOR the ratification of appointment of
independent registered public accounting firm and in the discretion of
the proxy holders as to any other matters that may properly come before the
meeting. You have the right to revoke your proxy any time prior to it being
voted by (i) delivering a written revocation or duly executed proxy bearing a
later date to the Corporate Secretary (at 1212 North Hercules Avenue,
Clearwater, Florida 33765) or (ii) attending the meeting and voting your shares
in person.
Whether
or not you attend the meeting, your vote is important. Accordingly, regardless
of the number of shares you own, you are asked to vote promptly by signing and
returning the accompanying proxy card.
Your
shares can only be voted at the meeting if you are represented by proxy or are
present in person.
VOTING
SECURITIES AND VOTING RIGHTS
The Board
has fixed the close of business on May 17, 2010 as the record date for
determining the stockholders who are entitled to notice of, and to vote at, the
meeting and at any adjournment thereof. On June 1, 2010, there were 3,735,329
shares of our common stock outstanding. Each stockholder of record on the record
date is entitled to one vote per share held. There are no other classes of
voting stock issued and outstanding.
Quorum
and Required Vote
A
majority of our outstanding common stock entitled to vote at the meeting must be
present in person or represented by proxy to have a quorum for the transaction
of business at the meeting. Under Delaware law and our Bylaws, the affirmative
vote of the holders of a plurality of the shares represented and entitled to
vote at the meeting at which a quorum is present is required to elect a
director. On the ratification of the appointment of Kirkland, Russ, Murphy &
Tapp, P.A. as Aerosonic Corporation’s independent registered public accounting
firm for the fiscal year ending January 31, 2011 and any other matters that
properly come before the meeting, a majority of the shares represented and
voting at the meeting is required to decide the question.
For
purposes of determining the presence of a quorum for transacting business at the
meeting, abstentions and broker “non-votes” (i.e., proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as shares that are present but which have not been voted.
Accordingly, shares represented by proxies marked “WITHHOLD AUTHORITY FOR THE
NOMINEE” and broker non-votes with regard to the election of directors will be
counted for purposes of determining the presence of a quorum at the meeting, but
will not be voted in the election of the director, and therefore, will have no
effect on the determination of the outcome of the votes for the election of the
director. Shares represented by proxies marked “ABSTAIN” with regard to the
ratification of the independent registered public accounting firm will be
counted for purposes of determining the presence of a quorum at the meeting, but
will not be voted in the ratification of the independent registered public
accounting firm, and therefore, will have no effect on the determination of the
outcome of the votes for the ratification of the independent registered public
accounting firm.
There is
an important change this year regarding broker non-votes and director elections.
Under an amendment to New York Stock Exchange Rule 452 that is effective for
this Annual Meeting of Stockholders, brokers, banks or other holders of record
are no longer permitted to exercise discretionary authority to vote in the
election of directors if the broker or other record holder has not received
instructions from the beneficial owner. This represents a change from prior
years, when brokers had discretionary voting authority in the election of
directors. As noted above, if voting instructions are not provided with respect
to the election of the director, the broker or other record holder can register
the shares as being present at the annual meeting for purposes of determining
the presence of a quorum but will not be able to vote on the election of the
director. Accordingly, it is particularly important that beneficial owners
instruct their brokers how they wish to vote their shares. Further, if voting
instructions are not provided with respect to the ratification of the
independent registered public accounting firm, the broker or other record holder
will be able to exercise its discretionary authority and vote on such
proposal.
ELECTION
OF DIRECTORS
Proposal
No. 1.—To elect one director to our Board of Directors
Our
Bylaws provide for a classified Board, with the number of directors which shall
constitute the whole Board determined by the Board, as may be fixed from time to
time by action of the Board and the number of classes into which the directors
shall be classified being three. Your Board currently consists of five directors
in total, two of whom are designated as Class I directors with a term expiring
in 2011, two of whom are designated as Class II directors with a term expiring
in 2012 and one of whom is designated as a Class III director with a term
expiring in 2010. At each Annual Meeting of Stockholders, directors in one class
are elected for a full term of three years to succeed those directors whose
terms are expiring. This year, the Class III director nominee will stand for
election for a three-year term expiring at the 2013 annual meeting. The
Nominating/Corporate Governance Committee of the Board has nominated Douglas J.
Hillman as director to serve as a Class III director, and the Board has endorsed
such nomination.
The
persons named in the enclosed proxy will vote all properly executed proxies for
the election of Douglas J. Hillman unless authority to vote is withheld. The
nominee has indicated his willingness to serve, if elected. However, if the
nominee should be unable to serve, the shares of common stock represented by
proxies may be voted for a substitute nominee designated by the Board.
Management has no reason to believe that the above-mentioned person will not
serve his term as a director.
Set forth
below is the name, age (as of June 1, 2010), principal occupation, and length of
service of the individual nominated for election to your Board. The nominee was
previously appointed by the Board and is currently serving as a director of the
Company.
Nominee
as Class III Director
Douglas J. Hillman, age 54,
joined the Company in April, 2008 as our President and Chief Executive Officer.
He also served as our Acting Chief Financial Officer from September 2008 until
May 2009. Mr. Hillman has held various executive and management positions within
the Aerospace industry for over 25 years. He joined Aerosonic from Kearfott
Guidance & Navigation Corporation, a manufacturer of precision guidance
components, where he served as Vice President/General Manager since 2005. From
2001 through 2005, he worked for Bird Technologies Group, a
designer/manufacturer of communications equipment, holding positions ranging
from Vice President/General Manager to Chief Operating Officer. Prior to Bird
Technologies Group, he held numerous management positions of increasing
responsibility at Moog Inc., a global designer and manufacturer of precision
control systems for aerospace and industrial applications. Mr. Hillman received
MBA and BSEE degrees from the State University of New York at Buffalo. He
currently serves on the Dean's Council for the University's School of
Engineering. In determining Mr. Hillman’s qualifications to serve on our board
of directors, the Board has considered, among other things, his experience and
expertise in the aerospace industry, including the operational, management, and
executive positions he has held previously in other aerospace
companies.
YOUR
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF
THE NOMINEE TO THE BOARD OF DIRECTORS AS SET FORTH ABOVE.
DIRECTORS
AND EXECUTIVE OFFICERS
Continuing
Directors
Class
I Directors (whose term will expire in 2011)
Thomas E. Whytas, age 45, has
been a director since May, 2004. Mr. Whytas, a U.S. veteran, has 22 years of
experience in the aerospace industry. He is currently the Chief Financial
Officer of Medical Education Technologies Inc. (METI), the industry leader in
medical simulation technology. Prior to METI, he served 15 years at CAE USA Inc.
in positions of increasing responsibility up through the position of Chief
Financial Officer and Finance Director of CAE’s U.S. operations. A Certified
Public Accountant, Mr. Whytas also holds a Master’s Degree in Accounting from
the University of South Florida. In determining Mr. Whytas’ qualifications to
serve on our board of directors, the Board has considered, among other things,
his experience and expertise in financial matters in manufacturing companies,
including defense contracting.
Donald
Russell, age 58, has been
a director since February, 2006. Mr. Russell is the managing partner of Sigma
Group, LLC, an executive coaching firm. Mr. Russell is also CEO and a Board
member of Old UGC. Inc. He also was a director of Etrials Worldwide Inc., a
publicly traded software company, until its merger with Merge in 2009. He was
Vice Chairman of the Board of Directors of CEA Acquisition Corporation from 2004
through February, 2006. Mr. Russell has been Chairman of the Investment
Committee for CEA Capital Partners USA, L.P. since February 1997 and a member of
the Investment Committee of Seaport Capital Partners II, L.P. since its
inception in February 2000. From July 1987 to June 1994, he was President of
Communication Equity Associates’ New York Affiliate, CEA, Inc. and was
responsible for overseeing its mergers, acquisitions and corporate financing
businesses in the cable television and broadcasting industries. From 1974-1978
Mr. Russell worked for National Westminster Bank USA as a commercial lending
officer. Mr. Russell has a B.A. in economics from Colgate University. In
determining Mr. Russell’s qualifications to serve on our board of directors, the
Board has considered, among other things, his experience and expertise in the
investment banking and public company leadership.
Class
II Directors (whose term will expire in 2012)
Roy Robinson, age 60, has been
a director since January, 2008 when he was appointed to fill a vacancy on the
Board. Mr. Robinson served as CEO of Seattle based Aviation Technologies, Inc.
from 2003 until his retirement in 2007. Previously, he was President of ELDEC
Corporation (“ELDEC”). Following the acquisition of ELDEC by the Crane Aerospace
Group, he was appointed Chief Operating Officer of the Crane Aerospace Group of
companies which included ELDEC, Hydro-Aire, Lear Romec, and Resistoflex. In
determining Mr. Robinson’s qualifications to serve on our board of directors,
the Board has considered, among other things, his experience and expertise in
the aerospace industry, including the operational, management, and executive
positions he has held previously in other aerospace companies.
P. Mark Perkins, age 53,
joined Aerosonic as Executive Vice President of Sales and Marketing in 1998.
Prior to joining Aerosonic, he was Vice President of Sales and Marketing at Gulf
Aerospace, Inc. from 1992 to 1998. Previously, he served as Vice President and
General Manager of National Aviation Academy. He also served as Assistant Vice
President of Commercial Lending with SunTrust Bank. He has over 20 years of
experience in various segments of the aviation industry including Sales,
Corporate Strategy, Business and Product Development as well as Investor
Relations. Mr. Perkins was elected to the Aerosonic Board of Directors in 1997
while at Gulf Aerospace. In determining Mr. Perkins’ qualifications to serve on
our board of directors, the Board has considered, among other things, his
experience and expertise in the aerospace and banking industries, including the
operational, management, and executive positions he has held previously in other
aerospace companies.
Please
see “Compensation of Directors” for information on the compensation arrangements
with our directors.
Non-Director
Executive Officers
Set forth
below are the names, ages (as of June 1, 2010), and positions of each of the
individuals who, in addition to Messrs. Hillman and Perkins, are deemed to be
our executive officers.
Thomas W. Cason, age 55, has
served as the Company’s Executive Vice President and Chief Operating Officer
since August 2008. Mr. Cason has held a number of senior operations roles,
including Executive Vice President and Chief Operating Officer of DeMorgan
Communities, an affordable housing developer, from 2006 through 2008. From 2003
to 2006, he served as Operations Director at Honeywell Aerospace, a provider of
cabin management systems for the private corporate jet industry. He holds MBA,
MS and BS degrees from Virginia Tech.
Kevin J. Purcell, age 52, has
served as the Company’s Executive Vice President and Chief Financial Officer
since May 2009. Before he joined the Company, he served as Vice President and
Chief Financial Officer of Herley Industries, Inc., a manufacturer of microwave
technology solutions, from 2006 until 2009. Prior to joining Herley, he served
as Vice President Finance, Contracts and Compliance for Smiths Aerospace LLC,
Customer Services Americas, a manufacturer of aircraft control and diagnostic
systems, from 2002 until 2006. Other prior experience included senior financial
positions including Vice President and CFO, Controller and Director as well as a
number of years in the Government Contractor Advisory Services group of KPMG. He
received his B.B.A. degree in financial accounting from Iona College and his
M.B.A. degree from Pepperdine University. He is a Certified Public Accountant, a
Certified Management Accountant, and a member of the American Institute of
Certified Public Accountants, the Institute of Management Accountants the
National Contract Management Association and the Financial Executives
International.
INFORMATION
REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
Independence
of the Board of Directors
As
required under the NYSE Amex listing standards, a majority of the members of a
listed company’s board of directors must qualify as “independent,” as
affirmatively determined by the Board. The Board consults with our counsel to
ensure that the Board’s determinations are consistent with relevant securities
and other laws and regulations regarding the definition of “independent,”
including those set forth in pertinent listing standards of the NYSE Amex, as in
effect from time to time.
Consistent
with these considerations, after review of all relevant transactions or
relationships between each director, or any of his or her family members, and
us, our senior management and our independent auditors, the Board has
affirmatively determined that the following directors are independent directors
within the meaning of the applicable NYSE Amex listing standards: Messrs.
Robinson, Russell and Whytas. In making this determination, the Board found that
none of these directors had a material or other disqualifying relationship with
us. Mr. Hillman, our President and Chief Executive Officer, and Mr. Perkins, our
Executive Vice President of Sales and Marketing, are not independent directors
by virtue of their employment with us.
Meetings
and Committees of the Board of Directors
During
the year ended January 31, 2010 (“fiscal year 2010”), the Board held eight
meetings. During fiscal year 2010, each of the then-directors attended at least
75% of the aggregate number of meetings of the Board and meetings of committees
thereof on which he served. We encourage all directors to attend the Annual
Meeting of Stockholders, in person. In 2009, all of the then-current directors
attended the Annual Meeting of Stockholders.
The Board
currently has, and appoints members of, a standing Audit Committee, Compensation
Committee, and Nominating/Corporate Governance Committee.
Audit Committee. The Audit
Committee is composed entirely of “independent directors” as determined by the
“audit committee” independent director standards of the NYSE Amex. Its members
are Thomas E. Whytas (chairman), Roy Robinson and Donald Russell. The Board has
determined that Mr. Whytas is the Audit Committee’s designated “financial
expert.” The Audit Committee met five times during fiscal year 2010. The
functions performed by the Audit Committee are described in the Audit Committee
Report, set forth below, and in the Audit Committee Charter adopted by the
Board, a copy of which is available on our website at www.aerosonic.com.
Compensation Committee. The
Compensation Committee members are Donald Russell (chairman), Roy Robinson and
Thomas E. Whytas, each of whom is an “independent” director as determined by
standards established by the NYSE Amex for compensation committees. The
Compensation Committee, which met one time during fiscal year 2010, reviews and
approves our employee benefit plans, administers our executive compensation
plans, and reviews and makes recommendations to the Board with respect to
compensation of outside directors, as set forth in its Charter, a copy of which
is available on our website at www.aerosonic.com.
Nominating/Corporate Governance
Committee. The Nominating/Corporate Governance Committee members are Roy
Robinson (chairman), Donald Russell and Thomas E. Whytas, each of whom is an
“independent director” as determined by standards established by the NYSE Amex
for nominating committees. The Nominating Committee reviews and assesses the
composition of the Board, assists in identifying potential new candidates as
directors, and submits its recommendations for nomination of directors to the
Board. The Nominating Committee also regularly reviews the size and composition
of the Board, individual director performance and recommends to the Board any
changes it deems appropriate. The policies and function of the Nomination
Committee are detailed in its Charter, which is currently available on our
website at www.aerosonic.com. The
Nominating Committee met two times during fiscal year 2010.
Our
Bylaws provide that stockholders may make nominations for election to the Board
and the Nominating Committee will consider those nominees. To recommend a
prospective nominee to the Nominating Committee for consideration at an annual
meeting, stockholders must submit the prospective nominee’s name and
qualifications to the Corporate Secretary, in writing, by delivering or sending
such recommendation not less than 90 days nor more than 120 days prior to the
anniversary of the preceding year’s annual meeting to the following address:
Aerosonic Corporation, 1212 North Hercules Avenue, Clearwater, Florida, 33765,
Attention: Corporate Secretary. Stockholders are urged to assure delivery of
their recommendations by arranging for some form of delivery receipt. The
Nominating Committee did not receive any nominations during the required time
period for consideration at this year’s annual meeting.
The
Nominating Committee’s policy regarding the consideration and selection of
director candidates (whether recommended by directors, members of management,
stockholders, or any other persons) is to seek candidates who have a
demonstrable record of personal and professional ethics and integrity, business
and professional experience, knowledge of our industry, academic achievements,
service on other boards of directors, and civic involvement. The Nominating
Committee has not set any objective minimum qualifications that must be met by a
nominee, but rather seeks to identify candidates with outstanding backgrounds
and experience as measured by the above selection criteria.
The
Nominating Committee’s process for identifying and evaluating director nominees
includes active solicitation of suggestions from our management, as well as
engaging in an active dialogue with executives and directors within our industry
and in related industries. The Nominating Committee also considers nominations
submitted by stockholders as discussed above. Although the Nominating Committee
does not have a formal policy regarding diversity, the Nominating Committee
considers the diversity of viewpoints, backgrounds and experiences, as well as
other various factors relevant to any particular nominee in identifying nominees
for a directorship. The Nominating Committee requires a background check by an
independent contractor of any candidate it deems as an appropriate nominee,
before making a recommendation of that person to the Board. The Company has not
paid any fees to third parties to identify or evaluate or assist in identifying
or evaluating potential nominees, but may consider the use of such third parties
in the future.
Board
Leadership Structure
The Board
currently includes three independent directors and two employee directors. The
Company does not have an official Chairman of Board position, however, the
Company’s Bylaws direct the President and CEO to organize and preside over
meetings of the Board of Directors. We have also implemented a lead independent
director position (“Lead Director”) which is currently filled by Mr.
Russell.
The Lead
Director must be an independent director and has several defined duties which
are designed to enhance effective governance and coordination. These include
providing a focal point for communication between management and the outside
directors; review and approve Board agendas as proposed by the President and
CEO; provide for Board development; and coordinate oversight of Board
activities.
We
believe that our current board leadership structure is appropriate as the
majority of the members of our board of directors are independent directors, and
all significant committees are led and staffed by our independent
directors.
The
Board’s Role in Risk Oversight
It is
management’s responsibility to manage risk and bring to the Board’s attention
any material risks to the Company. The Board has oversight responsibility
through its Audit Committee, which oversees the Company’s risk policies and
processes relating to the financial statements and financial reporting processes
and the guidelines, policies and processes for mitigating those risks. The Audit
Committee holds regular meetings with management to review the inherent risks
associated with the financial reporting process.
The Board
is actively involved in oversight of risks that could affect the Company. This
oversight is conducted primarily through committees of the Board as disclosed in
the descriptions of each of the committees above and coordinated by the Lead
Director with the full board of directors retaining responsibility for general
oversight of risks. The Board satisfies this responsibility through full reports
by each committee chairman regarding the committee's considerations and
actions.
Code
of Conduct
We have
adopted a Code of Conduct that includes a code of ethics that applies to all of
our employees and directors (including our principal executive officer and our
principal finance and accounting officer). This Code of Conduct is posted on our
website and is available for review at www.aerosonic.com/codeofconduct.html.
Communications
to the Board from Stockholders
The Board
welcomes communications from our stockholders and requests that all such
communications be sent to Aerosonic Corporation, 1212 North Hercules Avenue,
Clearwater, Florida 33765, Attention: Corporate Secretary. All communications
that relate to matters that are within the scope of responsibilities of the
Board or its committees will be forwarded to the appropriate directors by the
Corporate Secretary. Communications also may be addressed to one or more
directors, or to the entire Board. If a stockholder requests that any such
communication be treated as confidential and delivered only to one or more
directors, it may be submitted in a sealed envelope with a request that the
communication be treated as a confidential matter for immediate delivery to the
intended recipient(s).
COMPENSATION
OF DIRECTORS
Each
independent director receives annual cash compensation of $20,000 plus an annual
grant of shares of our common stock, valued at $20,000, rounded to the next
whole share. Effective for the fourth quarter of fiscal year 2010, Mr. Russell
receives an additional $10,000 annually for his role as Lead Director. Awards of
31,178 shares of our common stock for the fiscal year 2010 were made to Messrs.
Robinson, Russell and Whytas. The directors also earned an additional 3,807
shares of our common stock for services provided in the fiscal fourth quarter
ended January 31, 2010, and for which the common stock was issued in fiscal year
2011.
DIRECTOR
COMPENSATION TABLE
The
following table shows for our non-executive directors all compensation paid in
fiscal year 2010 on account of fees, whether paid in cash or stock of the
Company.
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Change in
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pension
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value and
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nonqualified
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(*)
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Non-equity
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deferred
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Fees paid
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Stock
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Option
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incentive plan
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compensation
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All other
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in cash
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awards
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awards
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compensation
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earnings
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compensation
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Total
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Name
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($)
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($) (1)
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($)
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($)
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($)
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($)
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($)
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Roy
Robinson
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$ | 20,000 | $ | 20,000 | $ | - | $ | - | $ | - | $ | - | $ | 40,000 | ||||||||||||||
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Donald
Russell
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$ | 20,000 | $ | 20,000 | $ | - | $ | - | $ | - | $ | - | $ | 40,000 | ||||||||||||||
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Thomas
E. Whytas
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$ | 20,000 | $ | 20,000 | $ | - | $ | - | $ | - | $ | - | $ | 40,000 | ||||||||||||||
|
(*)
|
Amounts
shown reflect grant date fair value computed in accordance with
stock-based compensation accounting rules (FASB ASC Topic 718). See
footnote 12 of our notes to the Consolidated Financial Statements in our
Form 10-K for the fiscal year ended January 31, 2010, for a discussion of
the assumptions used to compute grant date fair
value.
|
|
(1)
|
Amounts
do not include outstanding awards granted to the above named directors
consisting of 1,269 shares of common stock each, totaling 3,807 shares,
for services provided for the forth quarter of fiscal year
2010.
|
Cash Based Compensation. In
fiscal year 2010, non-executive directors received cash compensation of $20,000
each. Starting in the fourth quarter on FY 2010, an additional $10,000 will be
paid annually for the role of lead director. The Company does not pay additional
fees (in cash or otherwise) for attending board or committee meetings. Normally
each non-executive director is paid cash compensation of $5,000 per quarter or
$20,000 annually, on the last day of January, April, July and October. The
Company also reimburses non-executive directors for actual travel and
out-of-pocket expenses incurred in connection with their service to the
Company.
Stock-Based Compensation. In
fiscal year 2010, each non-executive director also received stock-based
compensation of $20,000. All stock-based compensation is accrued quarterly and
valued as of the last day of each fiscal quarter. The number of shares issued at
each of these dates is determined by the stock price at the close of business on
those dates.
Section
16(a) Beneficial Ownership Reporting Compliance
Section
16(a) of the Securities Exchange Act of 1934 (the “Act”), as amended, requires
our directors and specified officers to file reports on Forms 3, 4 and 5 with
respect to their ownership and changes in ownership of our equity securities
with the Securities and Exchange Commission (the “SEC”) and the NYSE Amex and to
furnish us with copies of these reports.
Based
solely upon a review of the copies of these Form 3, 4, and 5 reports and
amendments thereto that we received, and certain written representations that we
received from these persons, we believe that all applicable filing requirements
were complied with for fiscal year 2010 and do not know of any persons who may
have failed to file on a timely basis any required form, except as
follows:
Douglas
J. Hillman was granted stock options on February 27, 2009, and the Form 4
reporting the transaction was filed on March 6, 2009.
P. Mark
Perkins was granted stock options on April 22, 2008 and February 27, 2009, and
the Form 4 reporting these transactions was filed on March 6, 2009.
Thomas W.
Cason was granted stock options on August 26, 2008, and the Form 4A reporting
the transaction was filed on March 6, 2009.
Thomas W.
Cason was granted stock options on February 27, 2009, and the Form 4 reporting
the transaction was filed on March 6, 2009.
Donald
Russell, Roy Robinson and Thomas E. Whytas were each issued stock on July 31,
2009, and the respective Form 4’s reporting the transactions were filed on
August 5, 2009.
Douglas
J. Hillman purchased common stock of the Company on September 23, 2009, and the
Form 4 reporting the transaction was filed on September 28, 2009.
Review
of Related Person Transactions
We do not
have a formal written policy for the review and approval of transactions with
related parties. However, our Code of Conduct provides guidelines for reviewing
any "related party transaction." In particular, our Code of Conduct prohibits
conflicts of interest and provides non-exclusive examples of conduct that would
violate the prohibition. If any of our employees are unsure as to whether a
conflict of interest exists, the employee is instructed that he or she should
consult with the law department or the Chief Executive Officer or in the case of
a director, to the Audit Committee of the Board of Directors of Aerosonic, and
must comply with any actions the Audit Committee decides is necessary to protect
against the conflict of interest.
We
annually require each of our directors and executive officers to complete a
directors' and officers' questionnaire that elicits information about related
party transactions. Our Board and outside legal counsel annually review all
transactions and relationships disclosed in the directors' and officers'
questionnaires, and the Board makes a formal determination regarding each
director's independence. If a director is determined to no longer be
independent, such director, if he or she serves on any of the Audit Committee,
the Corporate Governance and Nominating Committee, or the Compensation
Committee, will be removed from such committee prior to (or otherwise will not
participate in) any future meetings of the committee. If the transaction
presents a conflict of interest, the Board will determine the appropriate
response.
For the
fiscal year ended January 31, 2010, there were no material related party
transactions involving employees or directors of the Company.
OWNERSHIP
OF SECURITIES
Based on
a review of filings with the SEC, as well as information available to us, the
following table sets forth information as of June 1, 2010 (except as noted
below) as to our common stock owned by (a) each of our directors, (b) each of
our named executive officers, (c) all of our current directors and executive
officers as a group and (d) each person who, to our knowledge, beneficially
owned more than 5% of our common stock. As of June 1, 2010, we had 4,169,903 of
our common shares issued and 3,739,136 common shares outstanding, of which 3,807
common shares have not been issued, but will be issued to certain individuals
within sixty days:
|
Name of Beneficial Owner (and address of Owners of More than 5%)
|
Amount of
Shares
Beneficially
Owned (1)
|
Percent
of
Class
|
|||||||
|
Douglas
J. Hillman
|
79,972 |
(2)
|
2.14 | % | |||||
|
Kevin
J. Purcell
|
11,528 |
(3)
|
* | ||||||
|
Thomas
W. Cason
|
14,250 |
(4)
|
* | ||||||
|
P.
Mark Perkins
|
50,334 |
(5)
|
1.35 | % | |||||
|
Roy
Robinson
|
27,150 |
(6)
|
* | ||||||
|
Thomas
E. Whytas
|
33,112 |
(7)
|
* | ||||||
|
Donald
Russell
|
110,834 |
(8)
|
2.96 | % | |||||
|
All
current directors and executive officers as a group
(7persons)
|
327,180 | 8.75 | % | ||||||
|
Electro
Technik Industries, Inc.
12449
Enterprise Boulevard
Largo,
FL 33773
|
486,000 |
(9)
|
13.00 | % | |||||
|
Bruce
Stone
28
Villa Lane
Boynton
Beach, FL 33436
|
241,774 |
(10)
|
6.47 | % | |||||
|
Martin
Finan
103
S. Stough Street
Hinsdale,
IL 60521
|
209,925 |
(11)
|
5.61 | % | |||||
|
Athena
Capital Management, Inc.
Minerva
Group, LP
David
P. Cohen
50
Monument Road, Suite 201
Bala
Cynwyd, PA 19004
|
284,548 |
(12)
|
7.61 | % | |||||
|
*
|
Less than
1%
|
|
(1)
|
The
directors, executive officers, and groups named in the table above have
sole or shared voting power or investment power with respect to the shares
listed in the table, unless otherwise indicated herein. The share amounts
listed include shares of our common stock that the following persons have
the right to acquire within 60 days from June 1,
2010.
|
|
(2)
|
Mr.
Hillman currently holds 13,972 shares of common stock, 66,000 exercisable
options and 57,000 unvested
options.
|
|
(3)
|
Mr.
Purcell was hired as our Chief Financial Officer in May 2009. He currently
holds 3,195 shares of common stock, 8,333 exercisable options and 16,667
unvested options.
|
|
(4)
|
Mr.
Cason currently holds 14,250 exercisable options and 34,750 unvested
options.
|
|
(5)
|
Mr.
Perkins currently holds 10,000 shares of common stock, 40,334 exercisable
options and 25,666 unvested
options.
|
|
(6)
|
Includes
accrued compensation to be paid in the Company’s common stock for the
first quarter of fiscal year 2011 of 1,269 shares of common
stock.
|
|
(7)
|
Includes
accrued compensation to be paid in the Company’s common stock for the
first quarter of fiscal year 2011 of 1,269 shares of common
stock.
|
|
(8)
|
Of
this amount, 2,500 shares are held by Mr. Russell’s spouse, and 2,000
shares are held in trusts for Mr. Russell’s children. Also, includes
accrued compensation to be paid in the Company’s common stock for the
first quarter of fiscal year 2011 of 1,269 shares of common
stock.
|
|
(9)
|
The
information for Electro Technik Industries, Inc. (ETI) is derived from a
Schedule 13D, dated December 31, 2008, filed with the SEC, which states
that, as of December 24, 2008, ETI beneficially owned 486,000 shares with
sole power to vote and dispose of such
shares.
|
|
(10)
|
The
information for Bruce Stone is derived from a Schedule 13G, dated March
30, 2010, filed with the SEC, which states that, as of March 23, 2010, he
beneficially owned 141,774 shares of the Company’s outstanding common
stock. He also holds 100,000 stock warrants issued to him pursuant to the
terms of a loan agreement between the Company and him. Each warrant
entitles him to purchase in whole or part one common share at $0.64 per
warrant. These warrants vested on May 21, 2010. For purposes of beneficial
ownership, he holds a total of 241,774 common shares with sole power to
vote and dispose of such shares.
|
|
(11)
|
The
information for Martin Finan is derived from a Schedule 13G, filed on
February 1, 2010, with the SEC, which states that, as of December 21,
2009, that he beneficially owned 209,925 shares. Of those shares, he holds
196,536 shares having sole power to vote and dispose of such shares, with
him having 13,389 shares with shared power to vote and dispose of such
shares.
|
|
(12)
|
The
information for Athena Capital Management, Inc., Minerva Group, LP and
David P. Cohen is derived from a Schedule 13G/A, dated and filed with the
SEC on February 3, 2010, which states that, as of December 31, 2009,
115,600 shares were owned by Athena Capital Management, Inc.; and 168,948
shares were owned by Minerva Group, LP. David P. Cohen beneficially owned
284,548 of which he has 168,948 shares with the sole power to vote and
dispose of such shares, and 115,600 shares with the shared power to vote
and dispose of such
shares
|
COMPENSATION
DISCUSSION AND ANALYSIS
The
Compensation Committee has the responsibility to review, approve and recommend
for the approval of the full Board our compensation program and the annual
compensation levels for our executive officers: the president and chief
executive officer, the executive vice president-chief financial officer, the
executive vice president-sales and marketing and the executive vice
president-chief operating officer.
Compensation
Objectives
The
primary goals of our executive compensation program are to incentivize and
reward superior executive performance and encourage excellent leadership, hard
work and dedication. Our compensation programs are designed to enable us to
achieve the following objectives:
|
|
•
|
to
attract, engage and retain top talent that ensures the achievement of
business goals, strategies and
objectives;
|
|
|
•
|
to
reward officers for long-term strategic management, which includes, among
other things, the implementation of performance enhancing strategies and
retention of key customers; and
|
|
|
•
|
to
reward superior executive performance that results in increased value for
our stockholders.
|
Compensation
Elements
Our
executive compensation program has a primary purpose to attract, retain and
motivate highly trained, experienced individuals whose technical expertise and
business talents will enable us to succeed. The key components of that program
during the last fiscal year were base salary, annual cash incentive awards and
long-term incentives, as discussed below.
Base Salary. The primary
element of our executive compensation is base salary. In approving or fixing
base salaries, the Compensation Committee draws upon its collective business
judgment and experience on what it understands to be fair, reasonable and
equitable compensation in view of our requirements for recruitment and retention
in a highly competitive market. In its deliberations, the Compensation Committee
considers:
|
|
•
|
the
executive’s compensation relative to other
officers;
|
|
|
•
|
the
executive’s compensation relative to competing
organizations;
|
|
|
•
|
recent
and expected performance of the
executive;
|
|
|
•
|
our
recent and expected overall performance;
and
|
|
|
•
|
our
overall budget for base salary
increases.
|
We rely
upon our judgment of numerous factors, and not solely upon set numerical
performance data or similar guidelines. We do not use short-term changes in our
stock price as a guide in determining executive compensation. Key factors
affecting our judgments include the nature and scope of each executive’s
responsibilities, effectiveness, productivity and growth. Of course, in order to
attract and retain talented executives, our executive compensation is also
calibrated by comparison to the executive compensation of executives at
similarly sized and situated companies in our industry.
Cash Incentive Award Program.
In addition to base salaries, each year we seek to reward superior executive
leadership through performance based cash incentives. We believe that our
structure allows us the flexibility to reward performance without creating a
system where annual incentives are paid without regard to performance and are
viewed as an entitlement rather than an incentive and reward. At the end of each
year, the Board, upon analysis and recommendation of the Compensation Committee,
determines the level of achievement for individual and corporate goals, and
awards an overall grade for the achievement of agreed objectives. Final
determination of incentive pay levels are then based on the achievement of these
individual and corporate goals, an assessment of the Company’s overall success,
and an assessment of each individual’s performance within the context of actual
business conditions. In certain circumstances, subject to the recommendations of
the Compensation Committee, as approved by the Board, annual incentives may
include equity compensation in lieu of cash or a combination of both equity
compensation and cash. Actual cash incentives are paid to the executives in the
second quarter of the following year, unless other arrangements are agreed. Cash
incentive awards were awarded for fiscal year 2010 to the named executive
officers as discussed below.
Long-Term Incentives. We have
one equity-based employee compensation plan, referred to as the Aerosonic
Corporation 2004 Stock Incentive Plan, as amended and restated on July 13, 2009.
Our long-term equity incentives are designed to focus management on the
long-term success of the Company to be evidenced by appreciation of the
Company’s stock price over several years, as a result of growth in its earnings
per share and other elements. These long-term equity incentives thereby align
the interests of the optionees with the interests of the stockholders. Stock
options were awarded in fiscal year 2010 to Messrs Hillman, Purcell, Perkins and
Cason of 48,000, 25,000, 24,000 and 24,000, respectively.
Management
and Compensation Committee Actions for 2010
With
respect to compensation paid in fiscal year 2010, the Compensation Committee
reviewed and reported to the Board the performance of each of our executive
officers for the purposes of determining the base salary of each, the amounts of
any cash incentive awards and other benefits, if any, to be paid or granted in
consideration for the services that were provided during fiscal year
2010.
The
Compensation Committee analyzed several factors, both qualitative and
quantitative, in determining overall compensation packages for fiscal year 2010
in order to tie financial rewards paid to our executive officers, to both our
then-current and expected future financial performance. In reviewing our fiscal
year 2010 performance, the Compensation Committee considered the following
factors: the condition the Company was in when the executives were hired; the
financial performance of the Company during the year; individual performance
objectives, the challenges faced due to the strained financial condition of the
Company; the effects of the August 8, 2008 fire and the actions taken by the
executives in connection with the recovery and turnaround of the Company; the
severely contracted lending environment; and the status of the recovery and
turn-around as the fiscal year 2010 concluded. The Compensation Committee has
recommended, and the Board approved the following cash incentive awards for
fiscal year 2010, to be paid in fiscal year 2011: Douglas Hillman, $105,000;
Kevin Purcell, $42,415; P. Mark Perkins, $54,482; and Thomas Cason,
$55,440.
Ownership
Guidelines
We do not
have a stock ownership policy for our executives.
Hedging
and Insider Trading Policies
During
fiscal year 2010 the Board, adopted a policy on insider trading for
officers, directors, employees and certain consultants of the Company and its
subsidiaries with respect to the trading of the Company’s securities,
as well as the securities of publicly-traded companies with whom the Company and
its subsidiaries have a business relationship. The policy prohibits any insider
from buying and selling Aerosonic securities at all times, except during
specified “window” periods. A window period begins on the third full trading day
after the public release by the Company of its quarterly financial results, or
prior year’s financial results in the case of the fourth quarter, and ends
fifteen calendar days prior to the end of the then current quarter. Even within
the designated window periods, insiders are still prohibited from buying and
selling the Company’s securities if an insider possesses material information
about the Company which is not publicly available. The policy generally does not
apply to the exercise of options to purchase common stock of the Company or its
subsidiaries.
We do not
have a formal policy on hedging.
Equity
Grant Practices
The Plan
is administered by the Plan Committee. Equity based awards are granted by the
Compensation Committee (and approved by the Board) and are based on the named
executive officer’s individual performance and contribution to the
Company.
Retirement
Benefits
We have
no defined benefit pension plan. We have a 401(k) Plan covering substantially
all employees. The 401(k) Plan is an important factor in attracting and
retaining employees as it provides an opportunity to accumulate retirement
funds. Our 401(k) Plan provides for annual deferral of up to $15,500 for
individuals until age 50, $20,500 for individuals 50 and older, or, as otherwise
allowed by the Internal Revenue Code. At January 31, 2009, the Company had
elected to discontinue matching employee contributions. Effective for the second
quarter of fiscal year 2011 we will begin matching 100% of employee
contributions up to 3% of the employee’s salary. Matching contributions will
vest according to the following schedule:
|
Years of Service
|
Vested
Interest
|
|||
|
Less
than 2 years
|
0 | % | ||
|
2
years, but less than 3 years
|
33 | % | ||
|
3
years, but less than 4 years
|
67 | % | ||
|
4
years or more
|
100 | % | ||
Welfare
Benefits
In order
to attract and retain employees, we provide certain welfare benefit plans to our
employees, which include medical and dental insurance benefits, group term life
insurance and disability insurance. We may also, from time to time provide other
benefits to executives. The Company presently does not provide any additional
benefits to its executive officers. None of these benefits are provided to
non-employee directors.
Employment
Agreements; Severance Arrangements
Mr.
Hillman’s employment agreement commenced on April 17, 2008 and he is an “at
will” employee. The employment agreement is terminable by: (i) the employee on
30 days prior written notice, or immediately upon mutual agreement, (ii) the
Company at any time with “cause” (as such is defined in the employment
agreement), immediately upon written notice to Mr. Hillman, or (iii) the
employee’s death or disability. In the event that the Company elects to
terminate Mr. Hillman without cause, the employee will be entitled to receive
severance payments of up to six months salary.
Mr.
Purcell’s employment agreement commenced on May 26, 2009 and he is an “at will”
employee. The employment agreement is terminable by: (i) the employee on 30 days
prior written notice, or immediately upon mutual agreement, (ii) the Company at
any time with “cause” (as such is defined in the employment agreement),
immediately upon written notice to Mr. Purcell, or (iii) the employee’s death or
disability. In the event that the Company elects to terminate Mr. Purcell
without cause, the employee will be entitled to receive severance payments of up
to six months salary.
Mr.
Perkin’s amended and restated employment agreement commenced on May 28, 2010 and
he is an “at will” employee. The employment agreement is terminable by: (i) the
employee on 30 days prior written notice, or immediately upon mutual agreement,
(ii) the Company at any time with “cause” (as such is defined in the employment
agreement), immediately upon written notice to Mr. Perkins, or (iii) the
employee’s death or disability. In the event that the Company elects to
terminate Mr. Perkins without cause, the employee will be entitled to receive
severance payments of up to six months salary.
Mr.
Cason’s employment agreement commenced on August 26, 2008 and he is an “at will”
employee. The employment agreement is terminable by: (i) the employee on 30 days
prior written notice, or immediately upon mutual agreement, (ii) the Company at
any time with “cause” (as such is defined in the employment agreement),
immediately upon written notice to Mr. Cason, or (iii) the employee’s death or
disability. In the event that the Company elects to terminate Mr. Cason without
cause, the employee will be entitled to receive severance payments of six months
salary.
As of
January 31, 2010, the estimated cash value of benefits for Messrs Hillman,
Purcell, Perkins and Cason are $104,000, $90,000, $86,000 and $82,500,
respectively. The value of each of these estimated severance benefits is based
on the amount of base salary and benefits payable from February 1, 2010 for the
applicable time period. In addition, each of Messrs. Hillman, Purcell and Cason
may be entitled to cash incentives continuation, subject to the recommendation
of the Compensation Committee and approval of the Board.
Options Vesting on Change in
Control. Under the Plan, all outstanding options shown in the table below
“Outstanding Equity Awards at Fiscal Year-End” for the Named Executive Officers
will become immediately exercisable in the event that there is, with respect to
us, a “change in control.” A “Change of Control” is defined by the Plan as: (i)
the acquisition by a person of control of 50% or more of the combined voting
securities of the Company, (ii) the merger or consolidation of the Company and
any other entity where the voting securities of the Company prior to thereto do
not represent more than 50% of the combined voting power of the voting
securities of the Company or such surviving entity immediately after such merger
or consolidation, or (iii) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company’s assets.
Indemnification
and Insurance
Under our
Certificate of Incorporation, indemnification is afforded our directors and
executive officers to the fullest extent permitted by Delaware law and in
addition, with respect to our “independent” directors pursuant to
indemnification agreements entered into between the Company and each of such
directors. In accordance with the terms of such indemnification agreements,
indemnification for the “independent” directors also includes payment of any
costs which an indemnitee incurs because of claims against the indemnitee and
provides for advancement to the indemnitee of those costs, including legal fees.
We are, however, not obligated to provide indemnity and costs where it is
adjudicated that the indemnitee did not act in good faith in the reasonable
belief that the indemnitee’s actions were in our best interests, or, in the case
of a settlement of a claim, such determination is made by our Board of
Directors.
We carry
insurance providing indemnification, under certain circumstances, to directors
and officers for claims against them by reason of, among other things, any act
or failure to act in their capacities as directors or officers. The current
annual premium for this policy is approximately $87,000.
No
payments have been made to any of our past or present directors or officers for
such indemnification or under any insurance policy.
Compensation
Recovery Policies
We
maintain a policy that we will evaluate in appropriate circumstances whether to
seek the reimbursement of certain compensation awards paid to an executive
officer, if such executive engages in misconduct that caused or partially caused
a restatement of our financial results, in accordance with section 304 of the
Sarbanes-Oxley Act of 2002. If circumstances warrant, we will seek to recover
appropriate portions of the executive officer’s compensation for the relevant
period, as provided by law.
Tax
Deductibility of Executive Compensation
We review
and consider the deductibility of executive non-performance based compensation
under the requirements of Code Section 162(m), which provides that we may not
deduct compensation of more than $1,000,000 that is paid to certain individuals,
subject to certain exceptions, including an exception for performance-based
compensation. We believe that compensation paid to our executives, including
under our incentive plans is generally fully deductible for federal income tax
purposes.
EXECUTIVE
COMPENSATION
The
following table provides certain summary information concerning the compensation
earned in fiscal year 2010 by our Chief Executive Officer and President,
Executive Vice President and Chief Financial Officer and each of our two other
most highly compensated executive officers who were serving as executive
officers as of January 31, 2010. We refer to the officers listed in the table
below collectively as our “Named Executive Officers.”
2010
Summary Compensation Table
|
Name and
Principal Position
|
Year
ended
Jan
31
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($) (1)
|
Option
Awards
($) (1)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Nonqualified
deferred
compensation
earnings
($)
|
All other
Compensation
($)(3)
|
Total
|
|||||||||||||||||||||||||
|
Douglas
J. Hillman,
|
2010
|
$ | 199,353 | 105,000 | — | 33,225 | — | — | 19,585 | $ | 357,163 | |||||||||||||||||||||||
|
President
& Chief Executive Officer
|
2009
|
$ | 157,229 | 19,750 | — | 238,104 | — | — | 8,144 | $ | 423,227 | |||||||||||||||||||||||
|
Kevin
J. Purcell,
|
2010
|
$ | 119,470 | 42,415 | — | 43,960 | — | — | 8,836 | $ | 214,681 | |||||||||||||||||||||||
|
Executive
Vice President and Chief Financial Officer (2)
|
2009
|
$ | — | — | — | — | — | — | — | $ | — | |||||||||||||||||||||||
|
P.
Mark Perkins,
|
2010
|
$ | 163,183 | 54,482 | — | 16,612 | — | — | 9,307 | $ | 243,584 | |||||||||||||||||||||||
|
Executive
Vice President Sales and Marketing
|
2009
|
$ | 163,329 | 14,438 | — | 82,563 | — | — | 14,145 | $ | 274,475 | |||||||||||||||||||||||
|
Thomas
W. Cason,
|
2010
|
$ | 146,644 | 55,440 | — | 16,612 | — | — | 1,418 | $ | 220,114 | |||||||||||||||||||||||
|
Executive
Vice President & Chief Operating Officer
|
2009
|
$ | 67,641 | 12,320 | — | 42,750 | — | — | 473 | $ | 123,184 | |||||||||||||||||||||||
|
(1)
|
Amounts
shown reflect grant date fair value computed in accordance with
stock-based compensation accounting rules (FASB ASC Topic 718). See
footnote 12 of our notes to the Consolidated Financial Statements in our
Form 10-K for the fiscal year ended January 31, 2010, for a discussion of
the assumptions used to compute grant date fair
value.
|
|
(2)
|
Hired in May,
2009.
|
|
(3)
|
All Other Compensation is the
value of employment benefits paid by the Company on behalf of the named
executive officer. The Company does not maintain a separate benefits plan
for its executives. These benefits include retirement contributions,
medical and dental insurances, life insurance and short-term
disability.
|
Stock
Option Information for the Year Ended January 31, 2010
The
following table provides information regarding each unexercised stock option
held by each of our Named Executive Officers as of January 31,
2010.
Outstanding
Equity Awards at January 31, 2010
|
Name and Principal Position
|
Number of
Securities
Underlying
Unexercised
Options
(# Exercisable)
|
Number of
Securities
Underlying
Unexercised
Options
(# Unexerciseable)
|
Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
||||||||||||
|
Douglas
J. Hillman,
|
25,000 | 50,000 |
(1)
|
— | $ | 4.47 |
4/22/2018
|
||||||||||
|
President
& Chief Executive Officer
|
— | 48,000 |
(2)
|
$ | 1.00 |
2/27/2019
|
|||||||||||
|
Kevin
J. Purcell,
|
— | 25,000 | (3) | — | $ | 2.36 |
5/26/2019
|
||||||||||
|
Executive
Vice President & Chief Financial Officer
|
|||||||||||||||||
|
P.
Mark Perkins,
|
7,500 | — | — | $ | 6.20 |
6/27/2015
|
|||||||||||
|
Executive
Vice President Sales and
|
7,500 | — | — | $ | 8.29 |
4/06/2016
|
|||||||||||
|
Marketing
|
6,250 | 18,750 | (4) | — | $ | 4.47 |
4/22/2018
|
||||||||||
| 1,000 | 1,000 | (5) | — | $ | 2.25 |
10/01/2018
|
|||||||||||
| — | 24,000 | (2) | — | $ | 1.00 |
02/27/2019
|
|||||||||||
|
Thomas
W. Cason,
|
6,250 | 18,750 | (6) | — | $ | 2.39 |
8/26/2018
|
||||||||||
|
Executive Vice President & Chief Operating
Officer
|
— | 24,000 | (2) | — | $ | 1.00 |
2/27/2019
|
||||||||||
|
(1)
|
Mr.
Hillman’s unexercised options will vest in two equal amounts on April 22,
2010 and 2011, respectively.
|
|
|
(2)
|
Messrs.
Hillman’s, Perkins’ & Cason’s unexercised options will vest in three
equal amounts on February 27, 2010, 2011 and 2012,
respectively.
|
|
|
(3)
|
Mr.
Purcell’s unexercised options will vest in three equal amounts on May 26,
2010, 2011 and 2012, respectively.
|
|
|
(4)
|
Mr.
Perkins’ unexercised options will vest in three equal amounts on April 22,
2010, 2011 and 2012, respectively.
|
|
|
(5)
|
Mr.
Perkins’ unexercised options will vest on October 1,
2010.
|
|
(6)
|
Mr.
Cason’s unexercised options will vest in two equal amounts on August 26,
2010 and 2011, respectively.
|
Stock
options were awarded in fiscal year 2010 to Messrs Hillman, Purcell, Perkins and
Cason of 48,000, 25,000, 24,000 and 24,000, respectively. No option awards were
exercised by any of the Named Executive Officers through June 1,
2010.
Potential
Payments Upon Termination or Change in Control
The
following table sets forth potential amounts payable to our Named Executive
Officers pursuant to their respective employment agreements. The table below
reflects the estimated amounts payable to our Named Executive Officers assuming
their employment was terminated as of January 31, 2010.
|
Name and Principal Position
|
Benefit
|
Termination
for other than Change
in Control*
|
Termination
Following a
Change in Control
|
|||||||
|
Douglas
J. Hillman,
|
Salary
|
$ | 104,000 | (1) | $ | 104,000 | ||||
|
President
& Chief Executive Officer
|
Benefits
|
|||||||||
|
continuation
|
— | (1) | — | |||||||
|
Total
value:
|
$ | 104,000 | (1) | $ | 104,000 | |||||
|
Kevin
J. Purcell
|
Salary
|
90,000 | (1) | 90,000 | ||||||
|
Executive
Vice President &
|
Benefits
|
|||||||||
|
Chief
Financial Officer
|
continuation
|
— | (1) | |||||||
|
Total
value:
|
$ | 90,000 | (1) | $ | 90,000 | |||||
|
P.
Mark Perkins,
|
Salary
|
86,000 | (1) | 86,000 | ||||||
|
Executive
Vice President
|
Benefits
|
|||||||||
|
Sales
and Marketing
|
continuation
|
— | — | |||||||
|
Total
value:
|
$ | 86,000 | (1) | $ | 86,000 | |||||
|
Thomas
W. Cason,
|
Salary
|
82,500 | (1) | 82,500 | ||||||
|
Executive
Vice President &
|
Benefits
|
|||||||||
|
Chief
Operating Officer
|
continuation
|
— | — | |||||||
|
Total
value:
|
$ | 82,500 | (1) | $ | 82,500 | |||||
|
*
|
Upon such termination of
employment, the applicable named executive may be entitled to future cash
incentive awards, subject to the Compensation Committee’s recommendation
and the Board’s approval.
|
|
(1)
|
Estimated value if the named
executive’s employment agreement had been terminated as of
January 31, 2010.
|
Potential
Payments Upon Termination or Change in Control
Please
see “Employment Agreements;
Severance Arrangements” above for a description of the severance
arrangements with Douglas J. Hillman, Kevin J. Purcell, P. Mark Perkins and
Thomas W. Cason.
Other
Compensation
All of
our executives are eligible to participate in our health and welfare benefit
plans. These plans are available to all employees and do not discriminate in
favor of executive officers. It is generally our policy to not extend
significant perquisites to our executives that are not available to all of our
employees. We have no current plans to make changes to levels of benefits and
perquisites provided to executives.
Tax
and Accounting Considerations
We have
structured our compensation program to comply with Section 409A of the Internal
Revenue Code of 1986, as amended, or Section 409A. If an executive is entitled
to nonqualified deferred compensation benefits that are subject to Section 409A,
and such benefits do not comply with Section 409A, then the benefits are taxable
in the first year they are not subject to a substantial risk of forfeiture. In
such case, the executive is subject to regular federal income tax, interest and
an additional federal income tax of 20% of the benefit includible in
income.
Compensation
Committee Interlocks and Insider Participation
Our
Compensation Committee currently determines the compensation levels of our
executive officers as described above. None of our executive officers has served
as a director or member of a compensation committee, or other committee serving
an equivalent function, of any entity of which one of its executive officers
served as a member of our Compensation Committee or our Board.
COMPENSATION
COMMITTEE REPORT
The
following Report of the Compensation Committee does not constitute soliciting
materials and should not be deemed filed or incorporated by reference into any
other Company filing under the Securities Act of 1933 or the Securities Exchange
Act of 1934, except to the extent the Company specifically incorporates this
Report.
The
Compensation Committee has reviewed and discussed the Compensation Discussion
and Analysis required by Item 402(b) of Regulation S-K with management and,
based on such review and discussions, the Compensation Committee recommended to
the Board of Directors that the Compensation Discussion and Analysis be included
in this proxy statement.
THE COMPENSATION
COMMITTEE
Donald
Russell (Chairman)
Roy
Robinson
Thomas E.
Whytas
AUDIT
COMMITTEE REPORT
The
following Report of the Audit Committee does not constitute soliciting materials
and should not be deemed filed or incorporated by reference into any other
Company filing under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this
Report.
In
accordance with its written Charter, the Audit Committee assists the Board in
fulfilling its responsibility for oversight of management and its independent
auditors in respect of corporate accounting, financial reporting practices, and
the quality and integrity of our financial reports.
Management
has the primary responsibility for our financial reporting process, accounting
principles, and internal controls, as well as, preparation of our financial
statements in accordance with generally accepted accounting principles in the
United States (“GAAP”). The independent auditors are responsible for planning
and conducting independent audits of our financial statements in accordance with
the standards of the Public Company Accounting Oversight Board, United States
(PCAOB) and applicable laws and regulations, and issuing reports thereon. The
Audit Committee is responsible for overseeing the conduct of these activities.
It is not the Audit Committee’s duty or responsibility to conduct auditing or
accounting reviews or procedures or to independently verify the representations
made by management and the independent auditors. The Audit Committee’s
considerations and discussions with management and the independent auditors do
not assure that our financial statements are presented in accordance with GAAP
or that an audit of the annual financial statements has been carried out in
accordance with the standards of the PCAOB, or that the independent auditors
are, in fact, “independent.”
In this
context, the Audit Committee has met and held discussions with our management
and independent auditors on a regular basis. The Audit Committee plans and
schedules its meetings with a view to ensuring that it devotes appropriate
attention to all of its responsibilities. The Audit Committee’s meetings
include, whenever appropriate, executive sessions with the independent auditors
without the presence of the Company’s management. The Audit Committee has
reviewed and discussed our audited financial statements with management and the
independent auditors, including a discussion of the quality of the accounting
principles, the reasonableness of significant judgments and the clarity of
disclosures in the financial statements. Management represented to the Audit
Committee that our audited financial statements were prepared in accordance with
GAAP and applicable laws and regulations. The audit committee has relied on this
representation, without independent verification, and on the representations of
the independent auditors included in their report on the consolidated financial
statements.
The Audit
Committee has discussed with our independent auditors the matters required to be
discussed pursuant to Statement on Auditing Standards No. 61, as amended (AICPA,
Professional Standards,
Vol. 1, AU Section 380), as adopted by the Public Company Accounting
Oversight Board in Rule 3200T. The independent auditors have provided to the
Audit Committee the written disclosures and the letter required by the PCAOB
Rule 3526, “Communication with Audit Committees Concerning Independence,” and
the Audit Committee has discussed with the independent auditors their
independence. The Audit Committee has also considered whether the independent
auditors’ provision of other non-audit services to the Company is compatible
with maintaining auditor independence. The Audit Committee has concluded that
the provision of non-audit services by the independent auditors was compatible
with the maintenance of independence in the conduct of their auditing
functions.
Based
upon its review and discussions with management and the independent auditors and
the reports of the independent auditors, and in reliance upon such information,
representations, reports and opinions, the Audit Committee recommended that the
Board of Directors approve our audited financial statements for inclusion in our
annual report on Form 10-K for the year ended January 31, 2010. The Board of
Directors accepted the Audit Committee’s recommendations.
THE
AUDIT COMMITTEE
Thomas E.
Whytas (Chairman)
Donald
Russell
Roy
Robinson
INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
Proposal
No. 2.—Ratification of Appointment of Independent Registered Public Accounting
Firm
Upon the
recommendation of the Audit Committee, the Board of Directors has appointed
Kirkland, Russ, Murphy & Tapp, P.A. as the Company’s independent registered
public accounting firm for the fiscal year ending January 31,
2011. Kirkland, Russ, Murphy & Tapp, P.A. served as our
independent auditors for the years ended January 31, 2010 and 2009.
McGladrey & Pullen, LLP, which acquired certain partners of our former
auditor Tedder, James, Worden & Associates, P.A. (collectively,
“McGladrey & Pullen”), served as our independent auditors for the first
three quarters of fiscal year 2009. Representatives from Kirkland, Russ, Murphy
& Tapp, P. A. are expected to be present at the meeting, will have the
opportunity to make a statement if they desire to do so and are expected to be
available to respond to appropriate inquiries.
Before
making its recommendation to the Board of Directors for appointment of Kirkland,
Russ, Murphy & Tapp, P.A., the Audit Committee carefully considered that
firm’s qualifications as the Company’s independent registered public accounting
firm, which included a review of Kirkland, Russ, Murphy & Tapp, P.A.’s
performance in the prior year, as well as its reputation for integrity and
competence in the fields of accounting and auditing. The Audit Committee
expressed its satisfaction with Kirkland, Russ, Murphy & Tapp, P.A. in these
respects.
The
Company is asking its stockholders to ratify the selection of Kirkland, Russ,
Murphy & Tapp, P.A. as the Company’s independent registered public
accounting firm. Although ratification is not required by our Bylaws or
otherwise, the Board of Directors is submitting the selection of Kirkland, Russ,
Murphy & Tapp, P.A. to stockholders for ratification because the Company
values its stockholders’ views on the Company’s independent registered public
accounting firm and as a matter of good corporate practice. If ratification is
not obtained, the Audit Committee intends to continue the engagement of
Kirkland, Russ, Murphy & Tapp, P.A. at least through the end of the 2011
fiscal year but will consider whether it is appropriate to select a different
independent registered public accounting firm in the future. Even if the
selection is ratified, the Audit Committee in its discretion may select a
different independent registered public accounting firm at any time during the
year if it determines that such a change would be in the best interests of the
Company and its stockholders.
YOUR
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION
OF APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM, AS SET
FORTH ABOVE.
Changes
in Registrant's Certifying Accountant
The
information provided below was filed on Form 8-K with the SEC on February 24,
2009 and is included in this proxy statement to comply with the requirements of
Item 304(a) of Regulation S-K.
As
described below, the Company dismissed McGladrey & Pullen, LLP (the “Former
Auditor”) as its independent registered public accounting firm, effective as of
February 18, 2009, and has engaged Kirkland, Russ, Murphy & Tapp, P.A.
(the “New Auditor”) as its new independent registered public accounting firm as
of and for the year ended January 31, 2009. As described in below, the
change in independent registered public accounting firm is not the result of any
disagreement with the Former Auditor.
Previous
Independent Accountants
(i) On
February 18, 2009, the Company dismissed the Former Auditor as its
independent registered public accounting firm effective on that
date.
(ii) The
report of the Former Auditor on the Company’s consolidated financial statements
as of and for the year ended January 31, 2008, did not contain an adverse
opinion or disclaimer of opinion and was not qualified or modified as to
uncertainty, audit scope, or accounting principles. The report of the Company’s
consolidated financial statements as of and for the year ended January 31, 2007
was issued by Tedder, James, Worden & Associates, P.A., certain of whose
partners merged with McGladrey & Pullen, LLP effective June 1, 2007, and did
not contain any adverse opinion or disclaimer of opinion and was not qualified
or modified as to uncertainty, audit scope or accounting
principles.
(iii) The
Company’s Audit Committee made the decision to change independent accountants,
acting under authority delegated to it by the Company’s Board of Directors and
also recommended that the Board of Directors approve the change. The
Board of Directors also approved the change of the independent
accountants.
(iv) During
the two most recent fiscal years and through February 18, 2009, there have been
no disagreements with the Former Auditor on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or procedure,
which disagreements, if not resolved to the satisfaction of the Former Auditor,
would have caused the Former Auditor to make reference to the subject matter of
such disagreements in its reports on the financial statements for such
years.
(v) During
the Company’s two most recent fiscal years and through February 18, 2009
there have been no “Reportable Events” (as defined in Regulation S-K,
Item 304(a)(1)(v)), except as described below:
|
·
|
As
set forth in Item 9A of the Annual Report on Form 10-K for the fiscal year
ended January 31, 2008, the Company and the Former Auditor identified
material weaknesses in internal controls over financial reporting and such
item is incorporated herein by reference. The Company has
authorized the Former Auditor to respond fully to any inquiries by the New
Auditor regarding the material weaknesses in internal controls set forth
in the Annual Report on Form 10-K.
|
|
·
|
During
the quarters ended May 2, 2008, August 31, 2008 and October 31, 2008, the
material weaknesses noted above continued to exist as indicated in Item 4
of the interim filings. The Company has authorized the Former Auditor to
respond fully to any inquiries by the New Auditor regarding the material
weaknesses in internal controls set forth in Item 4 of the interim
filings
|
(vi) We
have furnished the Former Auditor with a copy of the foregoing
disclosures.
New
Independent Accountants
On
February 18, 2009, we engaged Kirkland, Russ, Murphy & Tapp, P.A. as our
independent accountants for the year ended January 31, 2009. The Audit
Committee made the decision to engage the New Auditors acting under authority
delegated to it by the Company’s Board of Directors and the Board of Directors
approved the same.
The
Company has not consulted with the New Auditor during our two most recent fiscal
years or during any subsequent interim period prior to its appointment as New
Auditor regarding either (i) the application of accounting principles to a
specified transaction, either completed or proposed; or the type of audit
opinion that might be rendered on our consolidated financial statements, and
neither a written report was provided to us nor oral advice was provided that
the New Auditor concluded was an important factor considered by the Company in
reaching a decision as to the accounting, auditing or financial reporting issue;
or (ii) any matter that was either the subject of disagreement (as defined
in Item 304(a)(1)(iv) of Regulation S-K and the related instructions)
or a reportable event (within the meaning of Item 304(a)(1)(v) of
Regulation S-K).
We have
furnished the New Auditor with a copy of the foregoing disclosures.
Fees
for Audit and Other Related Services
The
following table sets forth the aggregate fees billed and paid by us to Kirkland,
Russ, Murphy & Tapp, P.A and McGladrey & Pullen, LLP for the years
ended January 31, 2010 and 2009 for audit and other professional
services.
|
Fiscal Years,
|
||||||||
|
2010
|
2009
|
|||||||
|
Audit
Fees
|
$ | 174,000 | $ | 296,000 | ||||
|
Audit-Related
Fees
|
30,000 | 36,000 | ||||||
|
Tax
Fees
|
36,000 | 4,000 | ||||||
|
All
Other Fees
|
— | 6,000 | ||||||
|
Total
Fees
|
$ | 240,000 | $ | 342,000 | ||||
The terms
“Audit Fees,” “Audit-Related Fees,” “Tax Fees,” and “All Other Fees” in the
above table, shall have the following meanings:
Audit Fees. Audit Fees, which
were approximately $174,000 and $296,000 for fiscal years 2010 and 2009,
respectively, are fees billed to us for professional services rendered for the
audit of our annual financial statements and review of financial statements
included in our Forms 10-Q, and services that are normally provided by our
independent registered public accounting firm in connection with statutory and
regulatory filings or engagements.
Audit-Related Fees.
Audit-Related Fees, which were approximately $30,000 and $36,000 for fiscal
years 2010 and 2009, respectively, are for the audit of our 401(k)
plan.
Tax Fees. Tax Fees, which were
approximately $36,000 and $4,000 for fiscal years 2010 and 2009, respectively,
are fees billed to us for professional services rendered for tax compliance, tax
advice and tax planning.
All Other Fees. All Other
Fees, which were approximately $0 and $6,000 for fiscal years 2010 and 2009,
respectively, are fees billed to us for products and services provided to us not
included in the foregoing categories.
The Audit
Committee has considered whether the provision of the services identified under
Audit-Related Fees, Tax Fees and All Other Fees is compatible with maintaining
the independence of our principal accountants and have determined that the
provision of such services is compatible with such accountants’
independence.
The
engagement of our independent auditors and any non-audit services to be provided
thereby shall be pre-approved by the Audit Committee or approved pursuant to
policies and procedures established by the Audit Committee. The Audit
Committee approved all fees for non-audit services for fiscal year
2010.
STOCKHOLDER
PROPOSALS FOR 2011 PROXY STATEMENT
In
accordance with Rule 14a-8 of the Securities Exchange Act of 1934, as amended,
any stockholder proposals intended to be included in the proxy statement and
presented at the 2010 Annual Meeting of Stockholders of the Company must be
received by the Company no later than February 9, 2011. The proposal should be
sent to our offices and be addressed to: Corporate Secretary, Aerosonic
Corporation, 1212 N. Hercules Avenue, Clearwater, FL 33765. In addition, the
Company has established an advance notice procedure with regard to certain
matters, including stockholder proposals not included in the Company’s proxy
statement, to be brought before an annual meeting of stockholders. In order to
be considered for inclusion in the annual meeting to be held in 2011,
stockholder proposals must be submitted to our Corporate Secretary at our
offices at 1212 N. Hercules Avenue, Clearwater, FL 33765, not less than 90 days
nor more than 120 days in advance of July 15, 2011. In addition, stockholder
proposals must meet other applicable criteria set forth in our Bylaws in order
to be considered at the 2011 annual meeting. Your Board will review any
stockholder proposals that are filed as required and will determine whether they
meet applicable criteria for consideration at the 2011 annual
meeting.
OTHER
MATTERS
We have
no information that any other matter will be brought before the meeting. If
other matters are presented, it is the intention of the persons named in the
accompanying form of proxy to vote the proxy in accordance with their best
judgment, discretionary authority to do so being included in the
proxy.
SOLICITATION
AND EXPENSES
We will
pay all costs associated with the solicitation of your proxy. In addition to the
solicitation of proxies by mail, proxies may be solicited by our directors and
officers, by personal interview, telephone, telegraph and mail. Brokerage
houses, banks and other fiduciaries will be requested to forward the soliciting
material to their principals and obtain authorization for the execution of
proxies and will be reimbursed for their reasonable out-of-pocket
expenses.
HOUSEHOLDING
"Householding"
is a program, approved by the Securities and Exchange Commission (the "SEC"),
which allows companies and intermediaries (e.g., brokers) to satisfy the
delivery requirements for proxy statements and annual reports by delivering only
one package of stockholder proxy material to any household at which two or more
stockholders reside. If you and other residents at your mailing address own
shares of our common stock in street name, your broker or bank may have notified
you that your household will receive only one copy of our proxy materials. Once
you have received notice from your broker that they will be "householding"
materials to your address, "householding" will continue until you are notified
otherwise or until you revoke your consent. If, at any time, you no longer wish
to participate in "householding" and would prefer to receive a separate proxy
statement, or if you are receiving multiple copies of the proxy statement and
wish to receive only one, please notify your broker if your shares are held in a
brokerage account. If you hold shares of our common stock in your own name as a
holder of record, "householding" will not apply to your shares.
We will
deliver promptly upon written or oral request a separate copy of our annual
report and/or proxy statement to a stockholder at a shared address to which a
single copy of either document was delivered. For copies of either or both
documents, stockholders should write to the Corporate Secretary, Aerosonic
Corporation, 1212 North Hercules Avenue, Clearwater, Florida 33765 or call
727.461.3000.
June 1,
2010
Clearwater,
Florida
AEROSONIC
CORPORATION
1212
North Hercules Avenue
Clearwater,
Florida 33765
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The
undersigned Stockholder of Aerosonic Corporation hereby acknowledges receipt of
the accompanying Proxy Statement for the Annual Meeting of Stockholders, dated
June 1, 2010, and hereby appoints Kevin J. Purcell as proxy, with full power of
substitution, to represent and vote as designated on the reverse side, all the
shares of Common Stock of Aerosonic Corporation held of record by the
undersigned on May 17, 2010, at the Annual Meeting of Stockholders to be held at
Aerosonic Corporation’s offices located at 1212 North Hercules Avenue,
Clearwater, Florida 33765, on Thursday July 15, 2010, at 10:00 A.M., local
time, or any adjournment or postponement thereof.
This
Proxy, when properly executed, will be voted in the manner directed herein by
the undersigned stockholder(s). If no direction is provided, the named proxy is
authorized and directed to vote on the proposal as described in the Proxy
Statement accompanying this Proxy. If the nominee shall cease to be a candidate
for election for any reason, the Proxy will be voted for a substitute nominee
designated by the Board of Directors.
(Continued
and to be signed on the reverse side)
ANNUAL
MEETING OF STOCKHOLDERS OF
AEROSONIC
CORPORATION
July 15,
2010
|
|
PROXY VOTING INSTRUCTIONS
|
|
|
MAIL - Sign, date and mail
your proxy card in the envelope provided as soon as
possible.
|
|
COMPANY NUMBER
|
|
|
or
|
|
ACCOUNT
NUMBER
|
|
|
IN
PERSON -
You may vote your shares in person by attending the Annual
Meeting.
|
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||
|
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|||
|
NOTICE
OF INTERNET AVAILABILITY OF PROXY MATERIALS: The Notice of Meeting,
Annual Report, Proxy Statement and Proxy Card are available at www.aerosonic.com/annualreports.html.
|
|||
i
Please detach along perforated line and mail in the envelope i
|
THE
BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF THE
DIRECTOR
PLEASE
SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR
VOTE IN BLUE OR BLACK INK AS SHOWN HERE x
|
|
1. To
elect one director to the Board of Directors of the Company, to hold
office until his successor has been duly elected and
qualified;
|
2. To
ratify the appointment of Kirkland, Russ, Murphy & Tapp, P.A.as the
independent registered public accounting firm; and
For¨
Against¨
Abstain¨
3. To
transact such other business as may properly come before the Meeting or
any adjournment or postponement thereof.
|
|||||||||||
|
NOMINEES:
|
|
|
||||||||||
|
¨ FOR THE NOMINEE
¨
WITHHOLD AUTHORITY
FOR THE
NOMINEE
|
Douglas
J. Hillman Class III Director
|
ALL
STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, SIGN,
DATE AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO
ENSURE YOUR REPRESENTATION AT THE MEETING. YOU MAY VOTE BY COMPLETING,
SIGNING AND DATING THE PROXY CARD AND RETURNING IT IN THE ENCLOSED
ENVELOPE. PLEASE NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY
A BROKER, BANK OR OTHER NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU
MUST OBTAIN FROM THE RECORD HOLDER A PROXY ISSUED IN YOUR
NAME.
|
||||||||||
|
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. ¨
|
¨
|
|
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Signature of Stockholder
|
|
|
Date:
|
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Signature of Stockholder
|
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|
Date:
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Note:
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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.
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