Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Information
Proxy Statement Pursuant to Section 14(a) of
the Securities
Exchange Act of 1934 (Amendment No.
)
Filed by the Registrant x
Filed by a Party other than the Registrant o
Check the appropriate box:
| o Preliminary Proxy Statement |
|
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| o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
|
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| x Definitive Proxy Statement | ||||
| o Definitive Additional Materials | ||||
| o Soliciting Material Pursuant to §240.14a-12 | ||||
FRED’S, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
| x | No fee required. |
| o | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. |
| (1) | Title of each class of securities to which transaction applies: |
| (2) | Aggregate number of securities to which transaction applies: |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
| (4) | Proposed maximum aggregate value of transaction: |
| (5) | Total fee paid: |
| o | Fee paid previously with preliminary materials. |
| o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| (1) | Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
| (3) | Filing Party: |
| (4) | Date Filed: |
Table of Contents
FRED’S, INC.
4300 NEW GETWELL ROAD
MEMPHIS, TENNESSEE 38118
MEMPHIS, TENNESSEE 38118
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held on Wednesday, June 21, 2006
to be held on Wednesday, June 21, 2006
TO THE SHAREHOLDERS OF FRED’S, INC.:
Notice is hereby given that the Annual Meeting of Shareholders of Fred’s, Inc. (the “Company”
or “Fred’s”) will be held at the Holiday Inn Express, 2192 S. Highway 441, Dublin, Georgia, on
Wednesday, June 21, 2006, at 5:00 p.m., Eastern Daylight Time, for the following purposes:
| 1. | To elect the Company’s Board of Directors; and | ||
| 2. | To approve the designation of BDO Seidman, LLP as our independent registered public accounting firm of the Company, as described in the Proxy Statement; and | ||
| 3. | To consider and act upon any other matters which properly come before the Annual Meeting or any adjournment of the meeting. |
The accompanying Proxy Statement contains further information with respect to these matters.
Only shareholders of record at the close of business on April 28, 2006 will be entitled to
vote at the meeting or any adjournment thereof.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, YOU ARE REQUESTED TO COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED FOR MAILING IN THE
UNITED STATES.
| By order of the Board of Directors, |
||||
| /s/ Charles S. Vail | ||||
| Charles S. Vail | ||||
| Secretary | ||||
May 26, 2006
TABLE OF CONTENTS
Table of Contents
FRED’S, INC.
4300 NEW GETWELL ROAD
MEMPHIS, TENNESSEE 38118
4300 NEW GETWELL ROAD
MEMPHIS, TENNESSEE 38118
PROXY STATEMENT
For Annual Meeting of Shareholders, June 21, 2006
The enclosed proxy is solicited by the Board of Directors (the “Board” or “Board of
Directors”) of Fred’s, Inc. (the “Company” or “Fred’s”) to be voted at the Annual Meeting of
Shareholders to be held on June 21, 2006, at 5:00 p.m., Eastern Daylight Time, at the Holiday Inn
Express, 2192 S. Highway 441, Dublin, Georgia, or any adjournment thereof (the “Annual Meeting”).
At the Annual Meeting, the presence in person or by proxy of the holders of a majority of the total
number of shares of outstanding Class A common stock (“Common Stock”) will be necessary to
constitute a quorum.
All shares represented by properly executed proxies will be voted in accordance with the
instructions indicated thereon unless such proxies previously have been revoked. If any proxies of
holders of Common Stock do not contain voting instructions, the shares represented by such proxies
will be voted FOR Proposals 1 and 2. The Board of Directors does not know of any business to be
brought before the Annual Meeting, other than as indicated in the notice, but it is intended that,
as to any other such business properly brought before the meeting, votes may be cast pursuant to
the proxies in accordance with the judgment of the persons acting thereunder.
Any shareholder who executes and delivers a proxy may revoke it at any time prior to its use
upon (a) receipt by the Secretary of the Company of written notice of such revocation; (b) receipt
by the Secretary of the Company of a duly executed proxy bearing a later date; or (c) appearance by
the shareholder at the meeting (with proper identification) and his request for the return of his
proxy or his request for a ballot.
A copy of this Proxy Statement and the enclosed Proxy Card are first being sent to
shareholders on or about May 26, 2006.
Voting Securities
Only shareholders of record at the close of business on April 28, 2006, will be entitled to
vote at the Annual Meeting. As of such date, the Company had outstanding and entitled to vote at
the Annual Meeting 39,910,449 shares of Common Stock. All references to shares and share prices
reflect the stock split effected on July 1, 2003. Each share of Common Stock is entitled to one
vote for all matters before the Annual Meeting.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by the election
inspectors appointed for the meeting. A quorum must be present in order for the Annual Meeting to
be held. In order for the quorum requirement to be satisfied, a majority of the issued and
outstanding shares of Common Stock entitled to vote at the meeting must be present in person or
represented by proxy. The election inspectors will treat abstentions as shares that are present and
entitled to vote for purposes of determining the presence of a quorum. If a broker indicates on the
proxy that it does not have discretionary authority as to specified shares to vote on a particular
matter, those shares will not be considered as present and entitled to vote with respect to that
matter. The nominees for Director receiving a plurality of the votes cast at the Annual Meeting in
person or by proxy will be elected. The election of the Company’s Board of Directors and the
designation of BDO Seidman, LLP as our independent registered public accounting firm will be
approved if the votes cast favoring the action exceed the votes cast opposing the action.
Abstentions and broker non-votes have no effect on the vote for the election of Directors and the
designation of BDO Seidman, LLP.
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Ownership of Common Stock
by Directors,
Officers and Certain Beneficial Owners
by Directors,
Officers and Certain Beneficial Owners
The following table sets forth the beneficial ownership known to the Company of Common Stock
as of April 28, 2006, by (i) beneficial owners of more than five percent of Common Stock, (ii) each
director, (iii) each of the persons named in the Summary Compensation Table, and (iv) all directors
and executive officers of Fred’s as a group.
| Shares of Common Stock Beneficially Owned(1) | ||||||||||||
| Number of Shares | ||||||||||||
| Beneficial Owner | Options(3) | Total(4) | Percent(2) | |||||||||
FMR Corp.(5) |
— | 5,941,900 | 14.7 | |||||||||
Century Capital Management LLC(6) |
— | 2,289,590 | 5.7 | |||||||||
Michael J. Hayes(7) |
55,250 | 2,403,541 | 6.0 | |||||||||
John R. Eisenman |
13,500 | 29,669 | * | |||||||||
Roger T. Knox |
13,500 | 35,580 | * | |||||||||
John D. Reier |
30,275 | 114,578 | * | |||||||||
Thomas H. Tashjian |
13,500 | 308,109 | * | |||||||||
B. Mary McNabb |
3,000 | 3,000 | * | |||||||||
Gerald E. Thompson |
3,000 | 3,000 | * | |||||||||
Jerry A. Shore |
13,500 | 59,630 | * | |||||||||
James Fennema |
2,000 | 25,100 | * | |||||||||
Dennis K. Curtis |
3,500 | 23,937 | * | |||||||||
All Directors and Executive Officers
As a Group (14 persons) |
158,080 | 3,060,775 | 7.6 | |||||||||
* Less than 1% |
||||||||||||
| (1) | As used in this table, beneficial ownership means the sole or shared power to vote, or direct the voting of, a security, or the sole or shared power to dispose, or direct the disposition, of a security. Except as otherwise indicated, all persons listed above have (i) sole voting power and investment power with respect to their shares of Common Stock, except to the extent that authority is shared by spouses under applicable law, and (ii) record and beneficial ownership with respect to their shares of Common Stock. The address for all except FMR Corp., and Century Capital Management LLC. is 4300 New Getwell Rd., Memphis, TN 38118. The address of FMR Corp. is 1 Federal Street, Boston, MA 02110-2003 and Century Capital Management LLC is 100 Federal Street, Boston, MA 02110-1802. | |
| (2) | Based on 40,314,836 shares, which consists of the total outstanding shares of Common Stock as of April 28, 2006 (39,910,449) and options (404,387) exercisable within sixty (60) days of April 28, 2006. | |
| (3) | Represents stock options that are exercisable within sixty (60) days of April 28, 2006. | |
| (4) | Includes stock options that are exercisable by beneficial owners within sixty (60) days of April 28, 2006. | |
| (5) | This information is based on Amendment 1 to Schedule 13G filed on February 14, 2006 by FMR Corp., which reported that as of December 31, 2005, it had sole power to vote or direct the vote of 7,600 shares and sole power to dispose of or direct the disposition of 5,941,900 shares. | |
| (6) | This information is based on a Schedule 13F filed by Century Capital Management, LLC (“Century”), which reported that as of March 31, 2006, it had sole power to vote or direct the vote of 2,289,591 shares. | |
| (7) | Includes 159,018 shares owned by Mr. Hayes’ wife and 56,832 shares owned by Memphis Retail Limited Partnership which are attributable to Mr. Hayes and two of his children. |
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PROPOSAL 1 (ELECTION OF DIRECTORS)
Seven directors, constituting the entire Board of Directors, are to be elected at the Annual
Meeting to serve one year or until their successors are elected and qualified. The Board of
Directors proposes the election of the following nominees:
| Nominee | Age | Title | ||||||
Michael J. Hayes |
64 | Chairman and Chief Executive Officer | ||||||
John R. Eisenman |
64 | Director | ||||||
Roger T. Knox |
68 | Director | ||||||
John D. Reier |
66 | Director and President | ||||||
Thomas H. Tashjian |
51 | Director | ||||||
B. Mary McNabb |
57 | Director | ||||||
Gerald E. Thompson |
56 | Director | ||||||
Principal Occupation, Business, and Directorships
Michael J. Hayes was elected a Director of the Company in January 1987 and was named Chairman
of the Board in November 2001. Mr. Hayes has been Chief Executive Officer since October 1989 and
served as a Managing Director of the Company from 1989 to 2002 when that position was eliminated.
He was previously employed by Oppenheimer & Company, Inc. in various capacities from 1976 to 1985,
including Managing Director and Executive Vice President — Corporate Finance and Financial
Services.
John R. Eisenman is involved in real estate investment and development located in Greensboro,
North Carolina. Mr. Eisenman has been engaged in commercial and industrial real estate brokerage
and development since 1983. Previously, he founded and served as President of Sally’s, a chain of
fast food restaurants, from 1976 to 1983, and prior thereto held various management positions in
manufacturing and in securities brokerage. Mr. Eisenman has served as a Director since the
Company’s initial public offering in March 1992.
Roger T. Knox is President Emeritus of the Memphis Zoological Society and was its President
and Chief Executive Officer from January 1989 through March 2003. Mr. Knox was the President and
Chief Operating Officer of Goldsmith’s Department Stores, Inc. (a full-line department store in
Memphis and Jackson, Tennessee) from 1983 to 1987 and its Chairman of the Board and Chief Executive
Officer from 1987 to 1989. Prior thereto, Mr. Knox was with Foley’s Department Stores in Houston,
Texas for 20 years. Mr. Knox has served as a Director since the Company’s initial public offering
in March 1992. Additionally, Mr. Knox is a Director of Hancock Fabrics, Inc.
John D. Reier is President and a Director. Mr. Reier joined the Company in May 1999 as
President and was elected a Director of the Company in August 2001. Prior to joining the Company,
Mr. Reier was President and Chief Executive Officer of Sunny’s Great Outdoors Stores, Inc. from
1997 to 1999, and was President, Chief Operating Officer, Senior Vice President of Merchandising,
and General Merchandise Manager at Family Dollar Stores, Inc. from 1987 to 1997.
Thomas H. Tashjian was elected a Director of the Company in March 2001. Mr. Tashjian is a
private investor. Previously, he served as a managing director and consumer group leader at Banc
of America Montgomery Securities in San Francisco. Prior to that, Mr. Tashjian held similar
positions at First Manhattan Company, Seidler Companies, and Prudential Securities. Mr. Tashjian’s
earlier retail operating experience was in discount retailing at the Ayrway Stores, which were
acquired by Target Corporation, and in the restaurant business at Noble Roman’s.
B. Mary McNabb was elected a director of the Company in April 2005. Ms. McNabb served as
Chief Executive Officer of Garden Ridge Stores, a home-décor chain in 2005. Prior to accepting
this position, she served as an Executive Vice President and a Director of The Mowbray Group, a
California-based retail consulting firm that specializes in problem-solving, cost reductions,
importing, and retail management. She also has served as a member of the Board of Directors of
C-ME (Cyber Merchants Exchange), a public company. McNabb was formerly Executive Vice President of
Merchandising and Marketing for Factory 2-U, Vice President of Sourcing for S-Q of California, and
West Coast Manager/Buyer for One Price Clothing, Inc.
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Gerald E. Thompson R.Ph., was elected a director of the Company in April 2005. He retired in
July 2004 from Eckerd Corporation, a subsidiary of J.C. Penney. Joining the company in 1997 as
regional vice president, a position he had held for almost 10 years with Thrift Drug Stores prior
to its merger with Eckerd that year, he was promoted to senior vice president of pharmacy services
in 2000. At different times during his career with Eckerd, Mr. Thompson held primary operating
responsibility for approximately 2,000 stores and, as senior vice president, he oversaw all of
Eckerd’s 2,800. Mr. Thompson served in the industry’s trade organization, the National
Association of Chain Drug Stores, where he participated in legislative activities on the federal
and state level and was a member of the Association’s Pharmacy and Governmental Affairs committees.
If, for any reason, any of the nominees shall become unavailable for election, the individuals
named in the enclosed proxy may exercise their discretion to vote for any substitutes chosen by the
Fred’s Board of Directors, unless the Board of Directors should decide to reduce the number of
directors to be elected at the Annual Meeting. Fred’s has no reason to believe that any nominee
will be unable to serve as a director.
Although the Company does not have a formal policy regarding attendance by members of the
Board of Directors at the Annual Meeting, the Company encourages all of its directors to attend.
All directors attended the 2005 Annual Meeting of Shareholders.
For information concerning the number of shares of Common Stock owned by each director, and
all directors and executive officers as a group as of April 28, 2006, see “Ownership of Common
Stock by Directors, Officers and Certain Beneficial Owners.” There are no family relationships
between any directors or executive officers of Fred’s.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE
ELECTION OF THE NOMINEES TO FRED’S BOARD OF DIRECTORS.
ELECTION OF THE NOMINEES TO FRED’S BOARD OF DIRECTORS.
Section 16(a) Beneficial Ownership Reporting Compliance
Based solely upon a review of reports of beneficial ownership of Fred’s Common Stock and
written representations furnished to Fred’s by its officers, directors and principal shareholders,
Fred’s is not aware of any such reporting person who or which failed to file with the Securities
and Exchange Commission (the “Commission”) on a timely basis any required reports of changes in
beneficial ownership during fiscal year 2005.
Board of Directors
During the last fiscal year, Fred’s Board of Directors held five meetings. Michael J. Hayes,
John R. Eisenman, Roger T. Knox, John D. Reier and Thomas H. Tashjian attended all of the Board
meetings and the prior year annual meeting. B. Mary McNabb and Gerald E. Thompson were added to
the Board of Directors in April 2005 and attended all meetings after that date. Mr. Hayes is
Chairman of the Board of Directors. Non-employee Directors of Fred’s are paid for their services
as such $22,260 per year plus reasonable expenses for meeting attendance, and are granted stock
options from time to time. John R. Eisenman, Roger T. Knox, Thomas H. Tashjian, B. Mary McNabb,
and Gerald E. Thompson are considered independent as defined in the listing standards of the
National Association of Securities Dealers’ Automated Quotation System (“NASDAQ”).
The Board of Directors has a process for shareholders to send communications to the Board.
Shareholders may send communications to our Board by sending a letter to: Board of Directors,
Fred’s Inc., c/o General Counsel, 4300 New Getwell Rd., Memphis, TN 38118. All communication will
be reviewed by our Legal Department and forwarded to the Board of Directors on a quarterly basis,
unless requested by the Board on a more frequent basis. Your communication will be treated
confidentially, subject to applicable laws, regulations or legal proceedings, if so marked on the
envelope or in the communication.
Corporate Governance
The Board of Directors believes the Company has observed sound corporate governance practices
in the past. However, following enactment of the Sarbanes-Oxley Act of 2002 and the adoption of
new rules and regulation by the National Association of Securities Dealers, Inc. and the Securities
and Exchange Commission, the Company, like many public companies, has addressed the changing
governance environment by reviewing its policies and procedures and, where appropriate, adopting
new practices. The matters are governed by the formal written charter of the Nominating and
Corporate Governance Committee.
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The Company has a code of ethics that applies to all of its directors, officers (including its
Chief Executive Officer, President, Chief Financial Officer, Chief Information Officer, Controller
and any person performing similar functions) and employees.
The Company’s code of ethics and board committee charters are available on the Company’s
website, and can be found under the Investor Relations and Governance links. The Company’s website
is www.fredsinc.com. The information contained on the website is not incorporated by reference in,
or considered part of, this Proxy Statement.
Audit Committee
The Audit Committee of the Board of Directors, which is comprised of John R. Eisenman,
Chairman of the Committee, Roger T. Knox, Thomas H. Tashjian, B. Mary McNabb, and Gerald E.
Thompson, met five times during the last fiscal year. Members Eisenman, Knox, and Tashjian
attended all of the Committee meetings. Members McNabb and Thompson were added to the Committee in
April 2005 and attended all meetings after that date. Each of the members of the Audit Committee is
an independent director as defined in the NASDAQ listing standards. Audit Committee members are
paid for their services $4,000 per year for Mr. Eisenman, Chairman and $2,400 per year for members
Knox, Tashjian, McNabb and Thomson plus reasonable expenses for meeting attendance.
The Audit Committee is responsible for the engagement of the independent registered public
accounting firm; considering the range of audit and non-audit fees; assisting the Board in
fulfilling its oversight responsibilities by reviewing the financial reports and other financial
information provided by the Company to any governmental body or the public; reviewing the Company’s
systems of internal controls regarding finance, accounting, legal compliance and ethics that
management and the Board have established; and reviewing the Company’s auditing, accounting, and
financial reporting processes generally.
Audit Committee members have the requisite financial experience to serve on the Audit
Committee. The management of the Company has the primary responsibility for the financial
statements and reporting process. The independent registered public accounting firm is responsible
for conducting and reporting on the audit of the Company’s financial statements in accordance with
generally accepted auditing standards. The Company’s independent registered public accounting firm
is ultimately accountable to the Audit Committee. The Board of Directors has adopted a written
charter for the Audit Committee, which was attached as Appendix B to the Company’s 2004 Proxy
Statement. The Board of Directors has determined that Mr. Tashjian meets the Commission’s
definition of audit committee financial expert.
Audit Committee Report
In the context of the role of the Audit Committee as outlined above, the Audit Committee has
reviewed and discussed the Company’s audited financial statements for 2005 with management of the
Company. BDO Seidman, LLP, the Company’s independent registered public auditing firm, is
responsible for performing an independent audit of the consolidated financial statements in
accordance with generally accepted auditing standards and the effectiveness of the Company’s
internal control over financial reporting. The Audit Committee also discussed with BDO Seidman,
LLP the matters required to be discussed by Statement on Auditing Standards (“SAS”) No. 61,
“Communication with Audit Committees” as amended, the Sarbanes-Oxley Act of 2002, and other matters
required by the Audit Committee’s charter. The Audit Committee has received the written disclosures
and the letter from BDO Seidman, LLP as required by Independence Standards Board Standard No. 1
“Independence Discussions with Audit Committees” and has discussed with BDO Seidman, LLP their
independence, including consideration of whether the payment to BDO Seidman, LLP of audit related,
tax, and permissible non-audit fees is compatible with maintaining their independence. Based upon
its review and discussions with Company management and BDO Seidman, LLP, the Audit Committee has
recommended to the Board of Directors that Fred’s, Inc. audited financial statements for fiscal
2005 be included in the annual report on Form 10-K for 2005 filing with the Securities and Exchange
Commission, and that BDO Seidman, LLP be considered for selection as the Company’s independent
registered public accounting firm for 2006.
The members of the Audit Committee are not professionally engaged in the practice of
accounting or auditing and, as such, rely without independent verification on the information
provided to them and on the representations made by management and BDO Seidman, LLP. Accordingly,
the Audit Committee’s oversight does not provide an independent basis to determine that management
has maintained appropriate accounting and financial reporting processes or appropriate internal
controls and procedures designed to assure compliance with the accounting standards and applicable
laws and regulations. Furthermore, the Audit Committee’s reviews and discussions referred to above
do not
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assure that the audit of the Company’s financial statements has been carried out in
accordance with generally accepted auditing standards, that the Company’s audited consolidated
financial statements are presented in accordance with generally accepted accounting principles, or
that BDO Seidman, LLP is in fact independent.
John R. Eisenman
Roger T. Knox
Thomas H. Tashjian
B. Mary McNabb
Gerald E. Thompson
Roger T. Knox
Thomas H. Tashjian
B. Mary McNabb
Gerald E. Thompson
Nominating Committee
The Nominating and Governance Committee of the Board of Directors (the “Nominating
Committee”), which met one time during the Company’s latest fiscal year, recommends nominees for
election to the Board by the shareholders at the annual meeting and makes recommendations to the
Board of Directors regarding corporate governance matters and practices. The Nominating Committee
is comprised of Thomas H. Tashjian, Chairman of the Committee, John R. Eisenman, Roger T. Knox, B.
Mary McNabb, and Gerald E. Thompson all of whom meet the independence requirements of NASDAQ
listing standards. Members McNabb and Thompson were added to the Committee in April 2005.
Nominating Committee members are paid for their services $1,500 per year for Mr. Tashjian, and $750
per year for the other members, plus reasonable expenses for meeting attendance.
The Nominating Committee identifies candidates for nominees based upon both its criteria for
evaluation and the candidate’s previous service on the Board. Additionally, the Nominating
Committee may use the services of a search company in identifying nominees. Although the Nominating
Committee has not determined specific minimum qualifications for its nominees, it evaluates
candidates that it has identified based upon:
| • | character, personal and professional ethics, integrity and values; | ||
| • | executive level business experience and acumen; | ||
| • | relevant business experience or knowledge (although preference may be shown for experience in or knowledge of the retail industry, it is not a prerequisite); | ||
| • | skills and expertise necessary to make significant contributions to the Company, its Board and its shareholders; | ||
| • | business judgment; | ||
| • | availability and willingness to serve on the Board; | ||
| • | independence requirements of NASDAQ listing standards; | ||
| • | potential conflicts of interest with the Company or its shareholders taken as a whole; and | ||
| • | accomplishment within the candidate’s own field. |
The Nominating Committee has adopted a policy with regard to considering a shareholder’s
nominee. To submit a nominee for consideration, a shareholder must provide the Nominating
Committee:
| • | proof of the shareholder’s eligibility to submit proposals in accordance with Rule 14a-8(b) of the Securities Exchange Act of 1934, as amended; | ||
| • | a complete description of the candidate’s qualifications, experience and background; and | ||
| • | the candidate’s signed consent to serve on the Board. |
In general, the Nominating Committee will evaluate a candidate identified by a shareholder
using the same standards as it uses for candidates it identifies. Before recommending a
shareholder’s candidate, the Nominating Committee may also:
| • | consider whether the shareholder candidate will significantly add to the range of talents, skills and expertise of the Board; | ||
| • | conduct appropriate verifications of the background of the candidate; and | ||
| • | interview the candidate or ask the candidate for additional information. |
The Nominating Committee has full discretion not to include a shareholder’s candidate in its
recommendation of nominees to the Board. If the Nominating Committee does not recommend a
shareholder’s candidate to the Board, it will not make public the reason or reasons for its
decision.
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Compensation Committee
The Compensation Committee reviews and approves the salaries and cash incentive compensation
of executive officers and recommends the grants of stock-based incentive compensation under Fred’s
long-term incentive plan. The Compensation Committee, which is comprised of Roger T. Knox,
Chairman of the Committee, John R. Eisenman, Thomas H. Tashjian, B. Mary McNabb, and Gerald E.
Thompson, met one time during the last fiscal year. Members Eisenman, Knox, and Tashjian attended
the Committee meeting. Members McNabb and Thompson were added to the Committee in April 2005.
Compensation Committee members are paid for their services $1,500 per year for Mr. Knox, Chairman
and $750 per year for the other members, plus reasonable expenses for meeting attendance. The
Board of Directors receives the grant recommendations of the Committee and may approve, amend or
reject the grant of restricted stock and stock options recommended by the Committee.
Executive Compensation
The following table sets forth the cash compensation paid, as well as certain other
compensation paid or accrued, to Fred’s chief executive officer and to each of the other four most
highly compensated executive officers whose aggregate cash compensation exceeded $100,000 during
the indicated fiscal years (the “Named Executives”).
SUMMARY COMPENSATION TABLE
| Long-Term | ||||||||||||||||||||||||
| Annual Compensation | Compensation | |||||||||||||||||||||||
| Restricted | Option | All Other | ||||||||||||||||||||||
| Name and | Salary | Bonus | Stock Awards | Awards | Compensation | |||||||||||||||||||
| Principal Position | Year | ($) | ($) | ($)(1) | (2) | ($) | ||||||||||||||||||
Michael J. Hayes |
2005 | 220,000 | — | — | — | 7,265 | (3) | |||||||||||||||||
Chairman and |
2004 | 220,000 | — | — | 14,000 | 8,433 | (3) | |||||||||||||||||
Chief Executive Officer |
2003 | 214,615 | 80,500 | — | — | — | ||||||||||||||||||
John D. Reier |
2005 | 250,000 | — | — | — | — | ||||||||||||||||||
President |
2004 | 250,000 | — | 229,050 | 14,000 | — | ||||||||||||||||||
| 2003 | 243,269 | 80,500 | — | 60,000 | — | |||||||||||||||||||
Jerry A. Shore |
2005 | 182,692 | — | — | — | — | ||||||||||||||||||
Executive Vice President- |
2004 | 157,692 | — | 152,700 | 6,000 | — | ||||||||||||||||||
Chief Financial Officer |
2003 | 145,962 | 55,200 | — | 27,000 | — | ||||||||||||||||||
James R. Fennema(4) |
2005 | 180,692 | — | — | — | 21,596 | (3) | |||||||||||||||||
Executive Vice President- |
2004 | 20,769 | — | 267,225 | — | — | ||||||||||||||||||
General Merchandise Manager |
2003 | — | — | — | — | — | ||||||||||||||||||
Dennis K. Curtis |
2005 | 150,364 | — | — | — | 720 | (3) | |||||||||||||||||
Executive Vice President- |
2004 | 128,265 | — | 152,700 | 5,000 | 801 | (3) | |||||||||||||||||
Store Operations |
2003 | 119,885 | 12,062 | — | 15.000 | 267 | (3) | |||||||||||||||||
| (1) | The aggregate restricted stock holdings for the above Named Executives, using the January 27, 2006 closing price of $15.41 per share, net of any consideration to be paid, was as follows: |
| Number | Value | |||||||
Michael J. Hayes |
— | — | ||||||
John Reier |
15,000 | $ | 231,150 | |||||
Jerry A. Shore |
10,000 | $ | 154,100 | |||||
James R. Fennema |
17,500 | $ | 269,675 | |||||
Dennis K. Curtis |
10,000 | $ | 154,100 | |||||
| All restricted stock holdings pay dividends at the same dividend rate as the Company’s Common Stock. All other holdings to named executives were issued January 15, 2005 and vest over 10 years or less based on operating performance. | ||
| (2) | The 2005 grants were performance based and cancelled due to non performance on 3/20/2006. |
|
| (3) | Consists of miscellaneous reimbursements | |
| (4) | Mr. Fennema joined the Company on December 13, 2004 |
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OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information on stock option grants pursuant to the Fred’s, Inc.
2002 Long-Term Incentive Plan during the last fiscal year for each of the Named Executives. The
Company has not granted any Stock Appreciation Rights.
| Individual Grants | ||||||||||||||||||||||||
| Potential Realizable | ||||||||||||||||||||||||
| Value at Assumed | ||||||||||||||||||||||||
| Annual Rates of | ||||||||||||||||||||||||
| Stock Price | ||||||||||||||||||||||||
| Options | % of Total | Exercise | Appreciation for | |||||||||||||||||||||
| Granted to | Options | or Base | Option Term(1) | |||||||||||||||||||||
| Employees | Granted | Price | Expiration | |||||||||||||||||||||
| Name | (#) | in Fiscal Year | ($/Sh) | Date | 5% ($) | 10% ($) | ||||||||||||||||||
Michael J. Hayes |
14,400 | (2) | 6.0 | 15.37 | 06/09/2012 | 90,103 | 209,978 | |||||||||||||||||
John D. Reier |
13,500 | (2) | 5.5 | 15.37 | 06/09/2012 | 83,846 | 195,396 | |||||||||||||||||
Jerry A. Shore |
6,000 | (2) | 2.5 | 15.37 | 06/09/2012 | 37,543 | 87,491 | |||||||||||||||||
James R. Fennema |
5,000 | (2) | 2.1 | 15.37 | 06/09/2012 | 31,285 | 72,909 | |||||||||||||||||
Dennis K. Curtis |
5,000 | (2) | 2.1 | 15.37 | 06/09/2012 | 31,285 | 72,909 | |||||||||||||||||
| (1) | The potential gain is calculated from the closing price of Common Stock on the date of grants until the end of the option period at certain assumed rates of appreciation set by the Commission. They are not intended to forecast possible future appreciation in the Common Stock and any actual gains on exercise of options are dependent on the future performance of the Common Stock. | |
| (2) | The 2005 grants were performance based and cancelled due to non performance on 3/20/2006. |
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
AND FY-END OPTION VALUES
The following table shows the stock option exercises by the Named Executives during the last
fiscal year. In addition, this table includes the number of exercisable and unexercisable stock
options held by each of the Named Executives as of January 28, 2006. The fiscal year-end value of
“in-the-money” stock options is the difference between the exercise price of the option and the
fair market value of the Common Stock (not including options with an exercise price greater than
the fair market value) on January 27, 2006 (the last trading date before the fiscal year-end),
which was $15.41 per share.
| Number of Securities | ||||||||||||||||||||||||
| Stock Option Exercises | Underlying Unexercised | Value of Unexercised | ||||||||||||||||||||||
| Options | In-The-Money Options | |||||||||||||||||||||||
| Shares | At Fiscal Year-end(#) | At Fiscal Year-end($) | ||||||||||||||||||||||
| Acquired | Value | |||||||||||||||||||||||
| on Exercise(#) | Realized ($)(1) | Exercisable | Unexercisable | Exercisable | Unexercisable | |||||||||||||||||||
Michael J. Hayes |
— | — | 69,650 | — | 138,005 | — | ||||||||||||||||||
John D. Reier |
— | — | 30,275 | 74,000 | 52,716 | 10,742 | ||||||||||||||||||
Jerry A. Shore |
21,563 | 261,488 | 13,500 | 33,000 | 23,361 | 4,614 | ||||||||||||||||||
James R. Fennema |
— | — | 2,000 | 23,000 | 280 | 2,720 | ||||||||||||||||||
Dennis K. Curtis |
— | — | 3,500 | 21,500 | 405 | 3,845 | ||||||||||||||||||
| (1) | “Value Realized” is the difference between the fair market value of the underlying shares on the exercise date and the exercise price of the option. |
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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
This Compensation Committee report documents the components of Fred’s executive officer
compensation programs and describes the basis on which fiscal 2005 compensation determinations were
made by the Committee with respect to the executive officers of Fred’s, including the Named
Executives.
Compensation Philosophy and Overall Objectives of Executive Compensation Programs
It is the philosophy of Fred’s that executive compensation be linked to improvements in
corporate performance and increases in shareholder value. The following objectives have been
adopted by the Committee as guidelines for compensation decisions:
| • | Provide a competitive total compensation package that enables Fred’s to attract and retain key executives. | ||
| • | Integrate all pay programs with Fred’s annual and long-term business objectives and strategy, and focus executive behavior on the fulfillment of those objectives. | ||
| • | Provide variable compensation opportunities that are linked with the performance of Fred’s and that align executive remuneration with the interests of shareholders. |
Compensation Program Components
The Committee reviews Fred’s compensation program annually to ensure that pay levels and
incentive opportunities are competitive and reflect the performance of Fred’s. The particular
elements of the compensation program for executive officers are further explained below.
Base Salary - Base pay levels are largely determined through comparisons with other retailing
companies. Actual salaries are based on individual performance contributions within a salary
structure that is established through job evaluation and job market considerations. Base pay
levels for the executive officers are competitive within the middle of a range that the Committee
considers to be reasonable and necessary. Various increases in base salary were recommended by the
Chief Executive Officer in fiscal 2005 for the other Named Executives, based on performance and
competitive considerations, and the Committee considered those recommendations in making its
determination.
Incentive Compensation - Fred’s officers are eligible to participate in an annual incentive
compensation plan with awards based primarily on the attainment of various specified levels of
operating profits. The objective of this plan is to deliver competitive levels of compensation for
the attainment of financial objectives that the Committee believes are primary determinants of
earnings growth. Targeted awards for executive officers of Fred’s under this plan are consistent
with targeted awards of other retailing companies of similar size and complexity to Fred’s.
Specified awards were recommended by the Chief Executive Officer for the other Named Executives of
Fred’s for fiscal 2005, based upon the Company’s performance, and the Committee considered these
recommendations in making its determination.
Fred’s Stock Option Program - The Committee strongly believes that by providing those persons
who have substantial responsibility for the management and growth of Fred’s with an opportunity to
increase their ownership of Common Stock, the best interests of shareholders and executives will be
closely aligned. Therefore, executives are eligible to receive stock options from time to time,
giving them the right to purchase shares of Common Stock in the future at a specified price. The
number of stock options granted to executive officers is based on competitive practices, with the
value of such options estimated by using a Black-Scholes pricing model.
Discussion of Compensation for the Chief Executive Officer
The Committee has considered Chief Executive Officer’s base salary, incentive compensation and
long-term incentives to be less than or equal to the total compensation paid to other executives
similarly situated, and has deems his beneficial ownership of Common Stock to provide adequate
linkage between the interests of Fred’s shareholders and Mr. Hayes’ personal interests.
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Summary
After its review of all relevant programs, the Committee continues to believe that the total
compensation program for executives of Fred’s is competitive with the compensation programs
provided by other companies with which Fred’s competes. The Committee believes that any amounts
paid under the incentive compensation plan will be appropriately related to corporate and
individual performance, yielding awards that are linked to the annual financial and operational
results of Fred’s. The Committee also believes that the stock option program provides
opportunities to participants that are consistent with the returns that are generated on behalf of
Fred’s shareholders.
Roger T. Knox
John R. Eisenman
Thomas H. Tashjian
B. Mary McNabb
Gerald E. Thompson
John R. Eisenman
Thomas H. Tashjian
B. Mary McNabb
Gerald E. Thompson
Employment Agreements
We have entered into employment agreements with each of Michael J. Hayes and John D. Reier
which became effective as of April 30, 2003.
Michael J. Hayes. Mr. Hayes’ employment agreement provides that we will employ him
for a period of two years commencing on May 1, 2003 with automatic employment extensions, the
latest which expires in May, 2007. The agreement provides that we will pay Mr. Hayes an annual
salary of up to $250,000 and that he will participate in any bonus plan of the Company. The
Compensation Committee shall annually review his salary and bonus plan. We may terminate Mr.
Hayes’ employment with or without cause. However, if we terminate this agreement other than for
cause, he will receive continued payment of his most recent salary, and other Company-provided
benefits, to the end of the term. Mr. Hayes has agreed not to compete with us for a period of six
months. In addition, if we terminate Mr. Hayes’ employment without cause, we will provide health
and dental benefits for Mr. and Mrs. Hayes.
John D. Reier. Mr. Reier’s employment agreement provides that we will employ him for
a period of two years commencing on May 1, 2003 with automatic employment extensions, the latest
which expires in May, 2007. The agreement provides that we will pay Mr. Reier an annual salary of
$250,000 and that he will participate in any bonus plan of the Company. The Compensation Committee
shall annually review his salary and bonus plan. We may terminate Mr. Reier’s employment with or
without cause. However, if we terminate this agreement other than for cause, he will receive
continued payment of his most recent salary, and other Company-provided benefits for one year. Mr.
Reier has agreed not to compete with us for a period of one year. In addition, if we terminate Mr.
Reier’s employment without cause, we will provide health and dental benefits for Mr. and Mrs. Reier
for five years.
Compensation Committee Interlocks and Insider Participation
None of the members of the Compensation Committee have at any time been one of our officers or
employees. None of our executive officers currently serves, or in the past year has served, as a
member of the board of directors or compensation committee of any entity that has one or more
executive officers serving on our board of directors or compensation committee.
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Comparison of Cumulative Total Return
The total cumulative return on investment assumes that $100 was invested in Fred’s, the NASDAQ
Retail Trade Stocks Index and NASDAQ Stock Market (U.S.) Index on February 3, 2001, and that all
dividends were reinvested.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG FRED’S, INC., THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE NASDAQ RETAIL TRADE INDEX
AND THE NASDAQ RETAIL TRADE INDEX
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PROPOSAL 2 (APPROVE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM)
BDO Seidman, LLP audited the Company’s consolidated financial statements for the year ended
January 28, 2006. BDO Seidman, LLP is an independent registered public accounting firm. The Board
of Directors is asking the shareholders to approve the appointment of BDO Seidman, LLP as such
independent registered public accounting firm for the fiscal year ending February 3, 2007.
Although not required by law, NASDAQ listing standards, or the Company’s bylaws, the Board of
Directors is submitting the selection of BDO Seidman, LLP to the shareholders for ratification as a
matter of good corporate practice. 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
shareholders, including economic considerations.
The Board of Directors will offer a resolution at the Annual Meeting to ratify this selection.
BDO Seidman LLP, which has acted as independent registered public accounting firm of Fred’s since
July 30, 2004, is expected to be represented at the Annual Meeting, will have the opportunity to
make a statement, if they desire to do so, and will be available to respond to appropriate
questions.
THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE
SELECTION OF BDO SEIDMAN, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM FOR FISCAL YEAR 2006.
SELECTION OF BDO SEIDMAN, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM FOR FISCAL YEAR 2006.
Changes in Certifying Independent Registered Public Accounting Firm
On June 11, 2004, Ernst & Young, LLP (“E&Y”) submitted to the Company an engagement letter
proposing fiscal 2004 auditing fees which were significantly higher than anticipated by the
Company. Therefore, the Company’s Audit Committee initiated the process of seeking 2004 quotes
from other auditors, and instructed management to attempt to resolve the unanticipated year-end
2003 fee under dispute with Ernst & Young before making a decision on which auditing firm to use
for fiscal 2004. On July 1, 2004, E&Y notified the Company that it would resign. The Company’s
Audit Committee accepted the E&Y resignation on the foregoing basis.
Each of the audit reports of E&Y on the consolidated financial statements of the Company for
each of the years in which they acted as the Company’s auditors in the two-year period ended
January 31, 2004 did not contain any adverse opinion or disclaimer of opinion, nor were they
qualified or modified as to uncertainty, audit scope, or accounting principles.
During all periods in which E&Y acted as the Company’s principal accountant through July 30,
2004, there were no disagreements with E&Y on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedures, which disagreements, if not
resolved to the satisfaction of E&Y, would have caused them to make reference to the subject matter
of the disagreement in their reports on the consolidated financial statements for such years.
During the past two fiscal years and through the date of this Report, E&Y has not advised the
Company of any reportable events (as defined in Item 304(a)(1)(v) of Regulation S-K), other than
E&Y reported to the Company that, in conducting its audit of the 2003 financial statements, it
noted weaknesses in certain internal controls. E&Y has not informed the Company that those
weaknesses constitute “material weaknesses” as defined by the American Institute of Certified
Public Accountants. The weaknesses related to (1) the number and qualifications of corporate
accounting personnel, (2) procedures related to accounting for consideration received from vendors,
and (3) the financial statement closing process. At the direction of its Audit Committee, the
Company had taken steps to address the concerns expressed by E&Y during its work for the Company.
The Company has enhanced its internal controls by (i) hiring additional skilled accounting staff
(ii) focused additional personnel and reviews upon accounting for consideration received from
vendors, and (iii) instituted more testing of results in the closing process before public
reporting of quarterly and fiscal year end results.
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On July 30, 2004, the Company engaged BDO Seidman, LLP (“BDO”) as its new certifying
accountants. The Company had not consulted with BDO during the two prior fiscal years and through
July 30, 2004 regarding the application of accounting principles to a proposed or completed
specified transaction or the type of audit opinion that might be rendered on the Company’s
consolidated financial statements, where either a written report was provided or oral advice was
provided that BDO concluded was an important factor considered by the Company in reaching a
decision as to the accounting, auditing or financial reporting issue or as to any disagreement or
reportable event as described in Item 304(a)(1)(iv) and Item 304(a)(1)(v) of Regulation S-K.
Fees Paid to Independent Registered Public Accounting Firms
The following table sets forth certain fees billed and to be billed to us by E&Y in fiscal
2004 and 2005 and BDO Seidman, LLP in fiscal 2004 and 2005 in connection with various services
provided to us throughout those fiscal years:
| 2005 Aggregate | 2004 Aggregate | |||||||
| Service | Fees Billed | Fees Billed | ||||||
Audit Fees(1) |
$ | 883,519 | $ | 927,036 | ||||
Audit-Related Fees(2) |
57,660 | 64,613 | ||||||
Tax Fees(3) |
75,097 | 48,275 | ||||||
All Other Fees |
— | — | ||||||
| (1) | 2004 Aggregate Audit Fees Billed includes $876,184 to BDO Seidman, LLP and $7,335 to Ernst & Young, LLP. Audit fees include fees and expenses associated with the annual audit of consolidated financial statements, reviews of quarterly financial statements, and Sarbanes-Oxley Section 404 attestation services. | |
| (2) | Audit related fees include $55,016 to BDO Seidman, LLP and $2,644 to Ernst & Young, LLP for audits of employee benefit plans, statutory audits of a subsidiary, and consultation on accounting and reporting matters. | |
| (3) | Tax fees represent billings for professional services for tax structuring and compliance (including federal, state, and local). |
The Audit Committee has the responsibility to pre-approve all audit and permissible
non-audit services provided by our independent registered public accounting firm. Where feasible,
the Audit Committee considers and, when appropriate, pre-approves such services at regularly
scheduled meetings after disclosure by management as to the nature of the services to be performed
and projected fees. The Committee also has authorized its Chairman to consider and, when
appropriate, pre-approve audit and non-audit services in situations where pre-approval is necessary
prior to the next regularly scheduled meeting of the Audit Committee. Company management and the
Chairman must report to the Audit Committee at its next meeting with respect to all services
pre-approved by him since the last Audit Committee meeting.
In fiscal 2005, all audit and permissible non-audit services provided by our independent
registered public accounting firms were pre-approved by the Audit Committee.
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OTHER BUSINESS
The Board of Directors knows of no other business which will be presented at the Annual
Meeting. If any other matters properly come before the Annual Meeting, it is intended that the
persons named in the proxy are authorized by you to act, and will act, in respect thereof in
accordance with recommendations of management and their best judgment.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be included in the proxy statement and presented at the 2007
Annual Meeting must be received by the Company no later than January 22, 2007, and the proposals
must meet certain eligibility requirements of the Securities and Exchange Commission. Proposals
may be mailed to Fred’s, Inc., to the attention of the Secretary, 4300 New Getwell Road, Memphis,
Tennessee 38118.
SOLICITATION OF PROXIES AND COST THEREOF
The cost of solicitation of the proxies will be borne by the Company. In addition to
solicitation of the proxies by use of the mails, employees of the Company, without extra
remuneration, may solicit proxies personally or by telecommunications. The Company will reimburse
brokerage firms, nominees, custodians and fiduciaries for their out-of-pocket expenses for
forwarding proxy materials to beneficial owners and seeking instruction with respect thereto.
SHAREHOLDERS MAY OBTAIN A COPY OF THE COMPANY’S ANNUAL REPORT ON FORM 10-K AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION WITHOUT CHARGE (EXCEPT FOR EXHIBITS), BY WRITING TO: FRED’S,
INC., ATTN: SECRETARY, 4300 NEW GETWELL ROAD, MEMPHIS, TENNESSEE 38118.
| By order of the Board of Directors, |
||||
| /s/ Charles S. Vail | ||||
| Charles S. Vail | ||||
| Secretary | ||||
May 26, 2006
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FRED’S, INC.
Holiday Inn Express
2192 S. Highway 441
Dublin, Georgia
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS — JUNE 21, 2006
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD
OF DIRECTORS
Charles S. Vail and Jerry A. Shore, or either of them with full power of substitution, are hereby authorized to represent and vote all the shares of common stock of the undersigned at the Annual Meeting of the Shareholders of Fred’s, Inc., to be held June 21, 2006, at 5:00 p.m., Eastern Daylight Time, or any adjournment thereof, with all powers which the undersigned would possess if personally present, in the following manner:
| 1. | Election of Directors for the term of one year. |
|
o FOR
all nominees listed below
(except as marked to the contrary below) |
o WITHHOLD
ALL AUTHORITY* to vote for all nominees listed below |
| *INSTRUCTION: | TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE THROUGH THE NOMINEE’S NAME BELOW. |
Michael J. Hayes John R. Eisenman Roger T. Knox John D. Reier Thomas H. Tashjian
B. Mary
McNabb Gerald E. Thompson
| 2. | Approval of BDO Seidman, LLP as independent registered public accounting firm of the Company, as described in the Proxy Statement. |
o FOR o AGAINST o ABSTAIN
In their discretion, the Proxies are authorized to vote upon such other business (none at the time of the solicitation of this Proxy) as may properly come before the meeting or any adjournment thereof.
Table of Contents
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR” EACH OF THE LISTED PROPOSITIONS.
WHEN PROPERLY EXECUTED, THIS PROXY SHALL BE VOTED AS DIRECTED. IN THE ABSENCE OF A CONTRARY DIRECTION, IT SHALL BE VOTED FOR THE PROPOSALS AND THE PROXIES MAY VOTE IN THEIR DISCRETION UPON SUCH OTHER MATTERS AS PROPERLY MAY COME BEFORE THE MEETING OR ADJOURNMENT THEREOF.
The undersigned acknowledges receipt of Notice of said Annual Meeting and the accompanying Proxy Statement, and hereby revokes all proxies heretofore given by the undersigned for said Annual Meeting. THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO VOTING THEREOF.
| Dated: |
|
, 2006 | ||||
| Signature of Shareholder | ||||||
| Signature of Shareholder (if held jointly) | ||||||
| Please Date this Proxy and Sign Your Name or Names Exactly as Shown Hereon. When signing as an Attorney, Executor, Administrator, Trustee or Guardian, Please Sign Your Full Title as Such. If There Are More than One Trustee, or Joint Owners, All must Sign. Please Return the Proxy Card Promptly Using the Enclosed Envelope. | ||||||