SOLICITATION OF PROXIES
The cost of the proxy solicitations will be borne by the Company. In
addition to the use of the mails, proxies may be solicited by the directors,
officers and employees of the Company, without additional compensation, by
personal interview, telephone, telegram or otherwise. Arrangements may also be
made with brokerage firms or other custodians, nominees or fiduciaries for the
forwarding of soliciting material to the beneficial owners of Common Stock of
the Company held of record by such persons, and the Company will reimburse such
respective brokers, custodians, nominees and fiduciaries for the reasonable
out-of-pocket expenses incurred by them in connection therewith. The Company
shall not use specially engaged employees or paid solicitors to identify
shareholders or to conduct the solicitation.
THE BOARD OF DIRECTORS
During the fiscal year ended July 31, 1998 ("fiscal 1998"), the Board
of Directors held four (4) meetings, attended by all of the Company's Directors.
One (1) such meeting was a Special Meeting of the Board. During fiscal 1998, the
Board of Directors acted by written consent three (3) times. The Company has a
compensation committee, which did not meet in fiscal 1998. The Company does not
have an audit committee, stock option committee, shareholder relations
committee, or a nominating committee.
Harry A. Dugger, III and John J. Moroney serve on the compensation
committee, which determines the cash compensation amounts to be paid to
directors, officers and employees of the Company. Because the Board of Directors
does not have a standing nominating committee, nominations for election to the
Board of Directors may be made by the Board of Directors or by any shareholder
entitled to vote for the election of directors. Nominations made by shareholders
must be made by written notice received by the Secretary of the Company within
ten (10) days of the date on which notice of a special meeting for the election
of directors is first given to shareholders.
Special meetings are held from time to time to consider matters for
which approval of the Board of Directors is desirable or is required by law.
SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS
As of the Record Date, there were 3,877,300 shares of Common Stock
outstanding and entitled to vote at the Annual Meeting. Each share is entitled
to one vote on each of the matters to be voted on at the Annual Meeting. The
following table sets forth, as of September 1, 1998, certain information
regarding the ownership of the Common Stock by (i) each person known by the
Company to be the beneficial owner of more than 5% of the Common Stock, (ii)
each of the Company's Directors and Named Executive Officers, as such term is
defined under Item 402(a)(3) of Securities and Exchange Commission ("SEC")
Regulation S-K, and (iii) all of the Company's Executive Officers and Directors
as a group. Beneficial ownership has been determined in accordance with Rule
13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange
A
ct"). Under Rule 13d-3 certain shares may be
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F 888.329.6696