0000950149-01-501454.txt : 20011009
0000950149-01-501454.hdr.sgml : 20011009
ACCESSION NUMBER: 0000950149-01-501454
CONFORMED SUBMISSION TYPE: DEF 14A
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 20011102
FILED AS OF DATE: 20010928
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: MONDAVI ROBERT CORP
CENTRAL INDEX KEY: 0000902276
STANDARD INDUSTRIAL CLASSIFICATION: BEVERAGES [2080]
IRS NUMBER: 942765451
STATE OF INCORPORATION: CA
FISCAL YEAR END: 0630
FILING VALUES:
FORM TYPE: DEF 14A
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-21624
FILM NUMBER: 1746909
BUSINESS ADDRESS:
STREET 1: 7801 ST HELENA HWY
STREET 2: PO BOX 106
CITY: OAKVILLE
STATE: CA
ZIP: 94562
BUSINESS PHONE: 7072599463
MAIL ADDRESS:
STREET 1: 7801 ST HELENA HWY
CITY: OAKVILLE
STATE: CA
ZIP: 94562
DEF 14A
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f75817adef14a.txt
DEFINITIVE PROXY STATEMENT
1
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
THE ROBERT MONDAVI CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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[ROBERT MONDAVI LETTERHEAD]
THE ROBERT MONDAVI CORPORATION
7801 St. Helena Highway
Oakville, California 94562
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS OF
THE ROBERT MONDAVI CORPORATION
TO BE HELD NOVEMBER 2, 2001
To the Shareholders:
The Annual Meeting of Shareholders of The Robert Mondavi Corporation
(the "Company") will be held at the Napa Valley Marriott, 3425 Solano Avenue,
Napa, California 94558, on Friday, November 2, 2001, at 10:00 a.m. local time,
for the following purposes:
1. To elect three Class A Directors and six Class B Directors;
2. To ratify the appointment of PricewaterhouseCoopers LLP as
the Company's independent accountants for the 2002 fiscal
year;
3. To approve amendments to the 1993 Non-Employee Directors'
Stock Option Plan to authorize discretionary grants of
options in addition to the non-discretionary grants now
authorized, to extend the term of the plan by ten years to
February 25, 2013, and to make certain technical changes to
conform the plan with recent changes in the federal
securities laws; and
4. To transact such other business as may properly come before
the meeting and any adjournment thereof.
All of the above matters are more fully described in the accompanying
Proxy Statement. Only shareholders of record at the close of business on
September 14, 2001 are entitled to notice of and to vote at the meeting or any
postponement or adjournment thereof.
By Order of the Board of Directors
/s/ Mike Beyer
Mike Beyer, Secretary
Napa, California
September 28, 2001
Immediately following the Annual Meeting of Shareholders is a reception
and tasting at the Robert Mondavi Winery in Oakville, California.
Please call (888) 766-4092 for information and reservations.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY IN THE ENCLOSED REPLY ENVELOPE. THIS WILL NOT LIMIT
YOUR RIGHT TO ATTEND OR VOTE AT THE MEETING.
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THE ROBERT MONDAVI CORPORATION
7801 ST. HELENA HIGHWAY
OAKVILLE, CALIFORNIA 94562
-------------------------------------
PROXY STATEMENT
-------------------------------------
Your proxy in the form enclosed is solicited by the Board of Directors
of The Robert Mondavi Corporation (the "Company") for use in voting at the
Annual Meeting of Shareholders to be held on Friday, November 2, 2001 at 10:00
a.m. local time, or at any adjournment thereof. The Annual Meeting will be held
at the Napa Valley Marriott, 3425 Solano Avenue, Napa, California 94558. This
Proxy Statement and the enclosed form of proxy, together with the Company's
Annual Report for fiscal 2001, were first mailed to shareholders on or about
September 28, 2001.
The Company's principal executive offices are located at 7801 St.
Helena Highway, Oakville, California 94562, and its telephone number is (707)
226-1395.
The shares represented by those proxies received, properly dated and
executed, and not revoked, will be voted at the Annual Meeting. A proxy may be
revoked at any time before it is exercised by delivering to the Secretary of the
Company at the Company's principal executive offices, no later than the start of
the Annual Meeting, a written notice of revocation or a duly executed proxy
relating to the same shares bearing a later date than the revoked proxy, or by
attending the Annual Meeting and voting the shares covered by the proxy in
person. All shares represented by proxies that are properly dated, executed and
returned, and which have not been revoked, will be voted in accordance with the
specifications on the enclosed proxy. If no such specifications are made, shares
of Class A Common Stock will be voted FOR the election of the three nominees for
Class A Directors listed in this Proxy Statement and FOR approval of proposal 2
and proposal 3 set forth in the Notice of Annual Meeting of Shareholders and
described in this Proxy Statement. Similarly, if no specifications are made,
shares of Class B Common Stock will be voted FOR the election of the six Class B
Directors listed in this Proxy Statement and FOR approval of proposal 2 and
proposal 3.
The Company will bear the expense of preparing, printing and mailing
this Proxy Statement and the proxies solicited hereby and will reimburse
brokerage firms and nominees for their reasonable expenses in forwarding
solicitation materials to beneficial owners of shares held of record by such
brokerage firms and nominees. In addition to the solicitation of proxies by
mail, officers and regular employees of the Company may communicate with
shareholders either in person or by telephone or facsimile for the purpose of
soliciting such proxies; no additional compensation will be paid for such
solicitation. The Company has retained Mellon Investor Services, at an estimated
cost of $1,700, plus reimbursement of expenses, to assist in the solicitation of
proxies from brokers, nominees, institutions and individuals.
OUTSTANDING SHARES AND VOTING RIGHTS
September 14, 2001 has been fixed as the record date for determining
the holders of Class A Common Stock and the holders of Class B Common Stock
entitled to notice of and to vote at the Annual Meeting. As of the close of
business on the record date, the Company had outstanding 9,181,217 shares of
Class A Common Stock and 6,855,717 shares of Class B Common Stock. Only holders
of Class A Common Stock are entitled to vote in the election of Class A
Directors. Only holders of Class B
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Common Stock are entitled to vote in the election of Class B Directors. On all
matters other than the election of directors, the holders of Class A Common
Stock and the holders of Class B Common Stock vote together as a single class,
with each Class A share entitled to one (1) vote, or a total of 9,181,217 Class
A votes, and each Class B share entitled to ten (10) votes, or a total of
68,557,170 Class B votes.
A majority of the outstanding shares of Class A Common Stock,
represented in person or by proxy, will constitute a quorum for purposes of
electing Class A Directors, and a majority of the outstanding shares of Class B
Common Stock, represented in person or by proxy, will constitute a quorum for
purposes of electing Class B Directors. On all other matters that may be
presented at the meeting, the holders of shares entitled to cast a majority of
the votes which could be voted thereon will constitute a quorum.
ELECTION OF DIRECTORS
(PROPOSAL 1 ON PROXY)
The Company's Bylaws provide that the Board of Directors shall consist
of not less than seven nor more than eleven directors. The Board of Directors,
pursuant to the authority conferred on them by the Bylaws, have set the number
of directors at nine, three of whom are to be elected by holders of the
Company's Class A Common Stock and six of whom are to be elected by holders of
the Class B Common Stock. Three Class A Directors and six Class B Directors,
named below, have been nominated for election at the Annual Meeting. Each
nominee is an incumbent director.
Unless you request on your proxy card that voting of your proxy be
withheld from any one or more of the following nominees for director, proxies of
Class A Common Stock will be voted for the election of the three nominees for
Class A Directors named below and proxies of Class B Common Stock will be voted
for the election of the six nominees for Class B Directors named below. In the
event any nominee named below becomes unavailable for election, the proxies in
the form solicited will be voted for an alternative or alternatives designated
by the present Board of Directors. Directors serve until the next Annual Meeting
of Shareholders and until their successors are elected or chosen.
NOMINEES FOR CLASS A DIRECTORS
Philip Greer, age 65, became a director of the Company in 1992. He is
chairman of the Audit Committee. Mr. Greer is a Senior Managing Director of
Weiss, Peck & Greer, L.L.C. ("WPG"), an investment company. He was a general
partner of WPG's predecessor, Weiss, Peck & Greer, for over twenty-five years.
Mr. Greer is also a director of Federal Express Corporation. He graduated from
Princeton University and the Harvard Graduate School of Business.
Frank E. Farella, age 72, has been a partner in the law firm of
Farella, Braun & Martel since 1962. He has been a director of the Company since
1992. He is a graduate of San Francisco State University and Stanford University
Law School.
Bartlett R. Rhoades, age 63, became a director of the Company in 1989.
He is chairman of the Compensation Committee and a member of the Audit
Committee. Mr. Rhoades has been involved in the management of a number of "start
up" companies. He is currently Chief Executive Officer, President and a director
of Healthtrac, Inc., in Menlo Park, California. He graduated from Harvard
College and the Harvard Graduate School of Business.
NOMINEES FOR CLASS B DIRECTORS
Robert G. Mondavi, age 88, founded the Company in 1966 and is now
Chairman Emeritus. He began making wine in California in 1937 and in 1943 his
family purchased the Charles Krug winery in
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the Napa Valley where he served as General Manager until 1966. He has been
inducted into Fortune Magazine's Business Hall of Fame. He is a member of the
American Institute of Wine and Food, the American Wine Society and the
Commanderie de Bordeaux. He graduated from Stanford University. Robert Mondavi
is the father of Michael and Timothy Mondavi and Marcia Mondavi Borger.
R. Michael Mondavi, age 58, is the Company's Chairman of the Board. He
helped found the Robert Mondavi Winery with his father in 1966 and has been a
member of the Board of Directors since that time. Michael Mondavi has served as
Chairman of the Wine Institute and of the Napa Valley Vintners Association and
as a director of the American Vineyard Foundation. Mr. Mondavi is a director of
Premier Package and Label Corporation. He graduated from Santa Clara University.
Marcia Mondavi Borger, age 54, has been a director of the Company since
1978. She has worked for the Company in various capacities since 1967. From 1982
to 1992, she was the Company's Vice President, Eastern Sales. She is a graduate
of Santa Clara University.
Timothy J. Mondavi, age 50, is the Company's Vice Chairman and
Winegrower. He began working at the Robert Mondavi Winery in 1974 and has been a
member of the Board of Directors since 1978. Timothy Mondavi is a member of the
Napa Valley Wine Technical Group and has served as a director of the Wine
Institute. He graduated from the University of California at Davis, where he
studied viticulture and enology.
Anthony Greener, age 61, joined the board in September 2000, and is a
member of the Audit Committee and the Compensation Committee. He is the retired
chairman of Diageo, a leading global consumer goods company formed in 1997 from
the merger of Grand Metropolitan and Guinness. From 1987 until 1997 he was a
member of the Board of Directors, and latterly Chairman and CEO, of Guinness.
Gregory M. Evans, age 52, was appointed to the Board of Directors, and
became the Company's President and Chief Executive Officer, in May 2001. He was
the Chief Operating Officer from 1998 to 2001 and the Chief Financial Officer
from 1983 to 1998. Mr. Evans graduated from the University of California at
Berkeley and holds an M.B.A. degree from the Harvard Graduate School of
Business.
RECOMMENDATION
The Board of Directors recommends that Class A shareholders vote FOR
re-election of the above-named Class A Directors and that Class B shareholders
vote FOR re-election of the above-named Class B Directors.
VOTE REQUIRED
The three nominees for Class A Directors and the six nominees for Class
B Directors receiving the highest number of affirmative votes of the shares
entitled to be voted for them shall be elected as Class A Directors and Class B
Directors, respectively. Votes withheld from any director are counted for
purposes of determining the presence or absence of a quorum, but have no legal
effect under California law. While there is no definitive statutory or case law
authority in California as to the proper treatment of abstentions and broker
non-votes in the election of directors, the Company believes that both
abstentions and broker non-votes should be counted for purposes of determining
whether a quorum is present at the Annual Meeting. In the absence of precedent
to the contrary, the Company intends so to treat them.
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OTHER EXECUTIVE OFFICERS
The following are additional executive officers of the Company. All
executive officers serve at the discretion of the Board of Directors, subject to
the terms of any employment agreement.
Peter Mattei, age 49, was appointed Senior Vice President, Group
Production in July 2001. Prior to that he had been the Company's Senior Vice
President, Production and Vineyards since 1991. Mr. Mattei holds a B.S. degree
from the University of California at Davis and an M.B.A. degree from Stanford
University.
Michael K. Beyer, age 52, became the Company's Senior Vice President,
General Counsel and Secretary in 1992. From 1976 to 1992, he was in private law
practice in Silicon Valley and San Francisco. Mr. Beyer graduated from Harvard
College and Boalt Hall School of Law of the University of California.
Mitchell J. Clark, age 52, was appointed Senior Vice President USA
Sales in July 2001. Mr. Clark began working for the Company in 1979 and became
Senior Vice President, Sales in 1994. He is a graduate of San Diego State
University.
Martin C. Johnson, age 50, was appointed Senior Vice President, Group &
Strategic Marketing in July 2001. Mr. Johnson joined the Company in 1992 and
became Senior Vice President, Marketing in 1994. Prior to joining the Company,
Mr. Johnson was Vice President, Marketing of Heublein Fine Wine Group. He is a
graduate of Northern Arizona University.
Steven R. Soderberg, age 41, was appointed Senior Vice President, IT
and Logistics in July 2001. Mr. Soderberg joined the Company in January 1998 as
Senior Vice President, Information Systems. Prior to joining the Company he was
Director of Information Systems, responsible for both International Information
Systems and Application Development, at Symantec Corporation. Mr. Soderberg is a
graduate of Stanford University.
Henry J. Salvo, Jr., age 52, was appointed Executive Vice President and
Chief Financial Officer in July 2001. Mr. Salvo joined the company in July 2000
as Senior Vice President and Chief Financial Officer. Prior to joining the
Company he was Vice President and Treasurer for The Clorox Company. Mr. Salvo
graduated from the University of California at Berkeley and holds an M.B.A.
degree from California State University Hayward.
Gregory J. Brady., age 40, was appointed Senior Vice President, Joint
Ventures and Arrowood in July 2001. He joined the Company in 1992 as Tax Manager
and was appointed Vice President-Tax Manager in 1997. Prior to coming to the
Company he was Senior Manager at Price Waterhouse. Mr. Brady is a graduate of
University of San Francisco.
Gayle Dargan, age 36, was appointed Senior Vice President, Robert
Mondavi Brand in July 2001. She joined the Company in 1996 as the Brand Manager
for Woodbridge Winery. Prior to joining the Company she was Brand Manager for
Gatorade and Snapple products at The Quaker Oats Company. Ms. Dargan is a
graduate of Yale University (BA) and has a graduate degree from Northwestern
University (MBA).
Dennis P. Joyce, age 39, was appointed Senior Vice President,
Woodbridge Brand in July 2001. He joined the Company in 2001 as Vice President,
Marketing for the Company's Lifestyle, Woodbridge and Robert Mondavi Coastal
lines. From 1999 to 2000 he was Vice President, Marketing for PlanetRX.com, a
leading Internet healthcare site. He also spent six years in brand management
with
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Johnson & Johnson. Mr. Joyce is a graduate of Georgetown University,
received his MBA from the University of Michigan, and also studied at Oxford
University.
Russell Weis, age 38, was appointed Senior Vice President,
International Business in July 2001. He joined the Company in 1993 as Export
Manager, Asia Pacific. Prior to joining the Company he was International Brand
Manager, California Wines for International Distillers and Vintners' North
American Business Development unit. Mr. Weis is a graduate of Pacific Union
College.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held four regular meetings and one special
meeting during fiscal 2001. The Board of Directors has a Compensation Committee
and an Audit Committee. Messrs. Rhoades and Greener compose the Compensation
Committee. They and Mr. Greer sit on the Audit Committee. There is no Nominating
Committee.
The Compensation Committee adopts and administers compensation plans
for executive officers of the Company, including the Company's Amended and
Restated 1993 Equity Incentive Plan. The Compensation Committee held nine
meetings in fiscal 2001.
The Audit Committee selects the independent accountants for the Company
(subject to ratification by the shareholders), reviews the scope and results of
the annual audit, approves the services to be performed by the independent
accountants, and reviews the independence of the accountants, the performance
and fees of the independent accountants, and the effectiveness and adequacy of
the system of financial reporting and internal accounting controls. The Audit
Committee held five meetings during fiscal 2001.
The Board of Directors has adopted a written charter for the Audit
Committee. A copy of the written charter is appended to this proxy statement.
The Board of Directors have determined that each member of the Audit Committee
is independent as defined in Rule 4200(a)(15) of the National Association of
Securities Dealers.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee has reviewed and discussed with management the
Company's audited financial statements for its fiscal year ended June 30, 2001.
The committee has discussed with the independent accountants the matters
required to be discussed by SAS 61 (Codification of Statements on Auditing
Standards, AU 380). The committee has reviewed the written disclosures and the
letter from the independent accountants required by Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees) and has
discussed their independence with the independent accountants.
Based on the review and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended June 30, 2001 for filing with the Securities and Exchange
Commission.
The foregoing report is given by members of the Audit Committee,
namely:
Philip Greer
Anthony Greener
Bartlett R. Rhoades
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PRINCIPAL SHAREHOLDERS
The following table sets forth certain information as of September 14,
2001 with respect to the beneficial ownership of the outstanding shares of Class
A Common Stock and Class B Common Stock by (i) all persons known by the Company
to own more than five percent of either class of the Company's Common Stock,
(ii) each director and director nominee and the executive officers named below
under "Executive Compensation -- Summary Compensation Table", and (iii) all
directors and executive officers as a group. Except as indicated in the
footnotes to the table, the Company believes that the persons named in the table
have sole voting and investment power with respect to all shares of Common Stock
shown as beneficially owned by them, subject to community property laws where
applicable.
CLASS A COMMON STOCK CLASS B COMMON STOCK (1)
------------------------------------------------------- -------------------------------
SHARES THAT MAY BE ACQUIRED
OUTSTANDING WITHIN 60 DAYS PERCENT SHARES PERCENT
SHARES BY EXERCISE OF OPTIONS OR OF BENEFICIALLY OF
BENEFICIAL OWNER BENEFICIALLY OWNED CONVERSION OF CLASS B SHARES CLASS (2) OWNED CLASS
---------------- ------------------ ---------------------------- --------- ------------ -------
Robert G. Mondavi - 1,830,762 (3) 16.6 1,830,762 26.7
R. Michael Mondavi - 1,895,921 (4) 17.1 1,615,575 (7) 23.6
Timothy J. Mondavi - 953,766 (5) 9.4 829,506 (8) 12.1
Marcia Mondavi Borger - 1,762,120 (6) 16.1 1,736,220 (9) 25.3
Dorothy R. Mondavi 620 220,261 (3) 2.3 220,261 3.2
Fidelity Management & Research Co. 999,900 (10) - 10.9 - -
One Federal St., Boston, MA 02109
Capital Research & Management Co. 866,700 (10) - 9.4 - -
333 So. Hope St, Los Angeles, CA 90071
Capital Guardian Trust Co. 703,200 (10) - 7.7 - -
333 So. Hope St, Los Angeles, CA 90071
Gregory M. Evans 2,000 170,705 (11) 1.8 - -
Mitchell J. Clark - 42,025 (11) * - -
Frank E. Farella 1,500 25,900 (11) * - -
Philip Greer 3,300 28,400 (11) * - -
Bartlett R. Rhoades 1,000 25,900 (11) * - -
Anthony Greener - 3,797 (11) * - -
All executive officers and 8,420 7,153,875 (12) 43.8 6,232,324 (13) 90.9
directors as a group (19 persons)
------------
* Less than 1%
(1) 214,209 shares of Class B Common Stock held by Robert Mondavi Properties,
Inc., a wholly-owned subsidiary of the Company, are not considered
outstanding for purposes of these calculations.
(2) Under Rule 13d-3 under the Securities Exchange Act of 1934, as amended, a
holder of Class B Common Stock is deemed to own beneficially the same number
of shares of Class A Common Stock since the holder has the right, subject to
the terms of the Stock Buy-Sell Agreement among the Company and the holders
of the outstanding shares of Class B Common Stock, to convert his Class B
Common Stock to Class A Common Stock. Pursuant to the same Rule, for
purposes of calculating the percentage of the outstanding shares of Class A
Common Stock owned by each named shareholder, the shares of Class A Common
Stock which a holder of Class B Common Stock may acquire by conversion are
considered outstanding only with respect to that holder. As a result, the
stated percentages of ownership of the Class A Common Stock do not reflect
the beneficial ownership of the Class A Common Stock which is actually
outstanding as of September 14, 2001.
(3) Represents shares of Class A Common Stock which the holder has the right to
acquire upon conversion of Class B Common Stock.
(4) Includes 1,615,575 shares of Class A Common Stock which the holder has the
right to acquire upon conversion of Class B Common Stock and 280,346 shares
of Class A Common Stock issuable pursuant to options exercisable within 60
days of September 14, 2001.
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(5) Includes 829,506 shares of Class A Common Stock which the holder has the
right to acquire upon conversion of Class B Common Stock and 124,260
shares of Class A Common Stock issuable pursuant to options exercisable
within 60 days of September 14, 2001.
(6) Represents 1,736,220 shares of Class A Common Stock which the holder has
the right to acquire upon conversion of Class B Common Stock and 25,900
shares of Class A Common Stock issuable pursuant to options exercisable
within 60 days of September 14, 2001.
(7) Excludes 105,000 shares of Class B Common Stock held by irrevocable trusts
for the benefit of Michael Mondavi's children. Mr. Mondavi disclaims the
beneficial interest in such shares. Includes 365,999 shares of Class B
Common Stock owned by or in trust for Isabel Mondavi, Michael Mondavi's
wife.
(8) Excludes 447,808 shares of Class B Common Stock held by irrevocable trusts
for the benefit of Timothy Mondavi's children.
(9) Excludes 154,930 shares of Class B Common Stock held by irrevocable trusts
for the benefit of Ms. Borger's children. Ms. Borger is not the trustee of
such trusts and has neither voting nor dispositive power with respect to
such shares. Includes 109,750 shares of Class B Common Stock held in trusts
for the benefit of Timothy Mondavi's children, for which Ms. Borger serves
as trustee and with respect to which she disclaims beneficial ownership.
(10) Based on most recent available filings on Form 13G.
(11) Represents shares of Class A Common Stock issuable pursuant to outstanding
options exercisable within 60 days of September 14, 2001.
(12) Includes an aggregate of 921,551 shares of Class A Common Stock issuable
pursuant to outstanding options exercisable within 60 days of September 14,
2001.
(13) Excludes an aggregate of 623,393 shares of Class B Common Stock owned
outright by or in trusts for members of the Robert Mondavi family not
otherwise listed above.
AGREEMENT AMONG HOLDERS OF CLASS B COMMON STOCK
The holders of the outstanding shares of Class B Common Stock and the
Company are parties to a Stock Buy-Sell Agreement (the "Buy-Sell Agreement").
Pursuant to the Buy-Sell Agreement, no holder of shares of Class B Common Stock
may, with limited exceptions, transfer Class B Common Stock or convert Class B
Common Stock into Class A Common Stock without first offering such stock to the
Company and then to the other parties to the Buy-Sell Agreement. The Buy-Sell
Agreement applies to a broad range of transfers and dispositions other than (i)
certain lifetime or testamentary transfers to issue of Robert and Marjorie
Mondavi, (ii) transfers to or in trust for charitable institutions or (iii)
certain other permitted transfers.
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EXECUTIVE COMPENSATION
The following table sets forth all compensation received for services
rendered to the Company in all capacities during the fiscal years ended June 30,
2001, 2000 and 1999, respectively, by (i) the Company's Chief Executive Officer
and (ii) the Company's four other most highly compensated executive officers
(together, the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------------------- -----------------------------------------
(1) OTHER # SECURITIES (6) PAYOUTS (7)
YEAR ANNUAL UNDERLYING LONG-TERM ALL OTHER
NAME AND PRINCIPAL POSITION FISCAL SALARY BONUS COMPENSATION OPTIONS INCENTIVE PLAN COMPENSATION
Robert G. Mondavi 2001 $ 450,000 $ $ $ $
Chairman Emeritus 2000 467,308 - - (2) - - -
1999 450,000 - - (2) - - -
R. Michael Mondavi 2001 537,307 205,200 108,741 (3) 47,003 51,975
Chairman of the Board 2000 415,385 300,000 109,288 (3) 17,503 - 50,077
1999 400,000 110,000 106,935 (3) 39,802 - 35,700
Timothy J. Mondavi 2001 440,383 195,500 69,228 (4) 23,336 44,512
Vice Chairman 2000 415,385 200,000 69,562 (4) 8,336 43,077
1999 400,000 55,000 - (2) 17,058 - 31,850
Gregory M. Evans 2001 413,844 179,100 - (2) 30,000 41,506
President and 2000 337,500 404,000 - (2) - - 51,905
Chief Executive Officer 1999 321,000 82,000 42,810 (5) 27,862 - 28,210
Mitchell J. Clark 2001 305,848 116,400 - (2) 11,500 29,557
Sr. Vice President, USA 2000 247,108 258,323 - (2) - - 35,380
Sales 1999 200,000 55,000 - (2) 22,744 - 17,850
------------
(1) Includes perquisites, none of which individually exceeded 25% of total
perquisites for the Named Executive Officer, except as noted.
(2) Individual perquisites do not exceed the lesser of $50,000 or 10% of
salary and bonus.
(3) Includes $94,500 in life insurance benefits.
(4) Includes $55,995 in life insurance benefits.
(5) Includes $30,375 in life insurance benefits and $12,435 in automobile
allowance.
(6) The Company has a deferred executive incentive compensation plan (the
"E.I.C.P.") in which certain key officers participate. Under the E.I.C.P.,
the Compensation Committee of the Board of Directors may make annual awards
of units to senior management plan participants. Each unit earns a
percentage of plan income, based on the Company's pre-tax earnings as
calculated on a FIFO basis, for a period of five years. The percentage of
plan income earned varies from 0.01% to 0.014%. Unit earnings vest at the
rate of 20% per year over the same five-year period. At the end of five
years, a portion of the earnings is distributed to the participant and any
balance is deferred and earns interest at the Company's average borrowing
rate until distribution under the terms of the E.I.C.P. The last units
awarded under the plan vested in fiscal 1998 and amounts distributed at
that time to the named executive officers were reported here. No
distributions from the E.I.C.P. were made to the named executive officers
in fiscal 1999, 2000 or 2001. For units granted prior to fiscal 1989, up to
30% of the earnings were initially distributed to the participant. For
units granted during and after fiscal 1989, the participant may elect in
the year of grant to receive up to 100% of earnings in the initial
distribution or to defer any portion of such amount. Upon termination of
employment due to death, disability, retirement or involuntary termination
without cause, the participant's units become fully vested and the
participant is entitled to receive all earnings accumulated on units
through the end of the fiscal year in which the termination occurs. Upon
termination of employment for cause or certain voluntary terminations, the
participant is entitled to receive all earnings accumulated on units
through the end of the fiscal year prior to the year the termination
occurs. The Company has the option to distribute plan balances over a
ten-year period.
(7) Includes the Company's contribution on behalf of the Named Executive
Officers to the Company's defined contribution retirement plan and
supplemental executive retirement plan. Retirement plan contributions in
fiscal 2001 were $51,975 for R. Michael Mondavi; $44,512 for Timothy J.
Mondavi; $41,506 for Gregory M. Evans; and $29,557 for Mitchell J. Clark.
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OPTION GRANTS
The following table sets forth information with respect to options
granted to the Named Executive Officers during the 2001 fiscal year. The options
were granted at an exercise price equal to 100% of the fair market value of the
Class A Common Stock at the date of grant and they vest at the rate of 1/60 per
month over 60 months. The options expire ten years after the date of grant, or,
if earlier, 180 days after termination of employment:
OPTION GRANTS IN LAST FISCAL YEAR (1)
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (2)
--------------------------------------------------------------- ----------------------------
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED EXERCISE OR
OPTIONS TO EMPLOYEES BASE PRICE EXPIRATION
NAME GRANTED IN FISCAL YEAR ($/SH) DATE 5% 10%
---- ---------- -------------- ----------- ----------- ----- -------
Robert G. Mondavi - - - - $ - $ -
R. Michael Mondavi 17,503 6.3 $32.438 7/26/10 357,057 904,853
29,500 10.6 $38.313 10/9/10 710,789 1,801,278
Timothy J. Mondavi 8,336 3.0 $32.438 7/26/10 170,052 430,946
15,000 5.4 $38.313 10/9/10 361,418 915,904
Gregory M. Evans 15,000 5.4 $38.313 10/9/10 361,418 915,904
15,000 5.4 $43.150 5/01/11 407,052 1,031,550
Mitchell J. Clark 11,500 4.1 $38.313 10/9/10 277,087 702,193
----------
(1) All options in this table relate to shares of Class A Common Stock.
(2) Potential realizable value is based on an assumption that the stock price
appreciates at the annual rate shown (compounded annually) from the date of
grant until the end of the option term (ten years). These numbers are
calculated based on the requirements promulgated by the Securities and
Exchange Commission and do not reflect the Company's estimate of future
stock price growth. Actual gains, if any, on stock option exercises are
dependent on the Company's future financial performance, overall market
conditions and the optionee's continued employment during the prescribed
vesting period.
OPTION EXERCISES AND YEAR-END VALUE OF UNEXERCISED OPTIONS
The following table sets forth information regarding each exercise of
stock options during the 2001 fiscal year by a Named Executive Officer and the
number and value of unexercised stock options held by the Named Executive
Officers at June 30, 2001:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES (1)
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED IN-THE-MONEY
SHARES UNEXERCISED OPTIONS AT FISCAL YEAR END OPTIONS AT FISCAL YEAR END (2)
ACQUIRED ON VALUE -------------------------------------- ------------------------------
NAME EXERCISE REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
Robert G. Mondavi - $ - - - $ - $ -
R. Michael Mondavi - - 269,899 86,906 3,456,271 687,034
Timothy J. Mondavi - - 118,192 47,202 1,231,005 434,986
Gregory M. Evans 77,000 2,550,594 159,307 74,055 3,254,217 522,752
Mitchell J. Clark 53,284 1,557,534 33,590 47,037 172,311 402,622
-------------
(1) All options in this table relate to shares of Class A Common Stock.
(2) Represents the fair value of the underlying securities at fiscal
year-end ($40.54 per share based on the NASDAQ closing price)
minus the exercise price.
BOARD COMPENSATION
Directors who are not employed by the Company are paid a $12,000 annual
retainer, $1,000 for each Board meeting attended and $500 for each committee
meeting attended. Non-employee directors are also reimbursed for expenses
incurred in attending meetings. Upon election to the Board, each
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director is granted options to purchase that number of shares of Class A Common
Stock equal to $150,000 divided by the closing price of the stock reported on
NASDAQ on the date the director joins the Board. The Non-Employee Directors'
Stock Option Plan also provides for additional annual grants to the outside
directors of 2,000 options each year. A proposed amendment to the plan would, if
approved by the shareholders, authorize the Board of Directors to award options
to an individual director or directors as a financial incentive.
REPORT OF THE COMPENSATION COMMITTEE
General
The Compensation Committee of the Board of Directors administers the
Company's executive compensation program. The Compensation Committee is composed
entirely of directors who are not employees of the Company, and who are
independent under applicable NASD rules.
The objective of the Company's executive compensation program is to
develop and maintain executive reward programs which (i) contribute to the
enhancement of shareholder value, (ii) are competitive with the pay practices of
other industry-leading companies and (iii) attract, motivate and retain key
executives who are critical to the long-term success of the Company. As
discussed in detail below, the Company's executive compensation program consists
of both fixed (base salary) and variable (incentive) compensation elements.
Variable compensation consists of annual cash incentives, stock option grants
and other stock-based awards under the Equity Plan and unit awards under the
Company's Executive Incentive Compensation Plan (the "E.I.C.P."). These elements
are designed to operate on an integrated basis and together comprise total
compensation value.
The Compensation Committee reviews executive compensation in light of
the Company's performance during the fiscal year and compensation data at
companies that are considered comparable. In reviewing the Company's performance
during fiscal 2001, the Compensation Committee considered a variety of factors.
Net revenues increased by 18.3% to $505.8 million in fiscal 2001 from $427.7
million in fiscal 2000. At the same time net income, excluding reorganization
and other one-time charges, increased by 18.7% to $48.2 million in fiscal 2001
from $40.6 million in fiscal 2000. The Company also took significant steps to
improve its return on capital and streamline the operations to increase
profitability of its core brands In reviewing Company performance, the
Compensation Committee considered these factors as a whole without assigning
specific weights to particular factors.
Base Salary
Base salary levels for the Company's executives are determined by the
Compensation Committee based on factors such as individual performance (e.g.
leadership, level of responsibility, management skills and industry activities),
Company performance (as discussed above) and competitive pay practices. The base
salary level for Mr. Robert Mondavi is established by his employment agreement
described below.
The Chief Executive Officer was R. Michael Mondavi from July 2000 to
April 2001 and Gregory M. Evans from May to June 2001. Base compensation for
each of them was reviewed by the Compensation Committee in the context of
compensation packages awarded to senior executive officers at comparable
companies selected by an outside compensation consultant. The companies included
in the comparison are not the same as the companies included in the peer group
index in the performance graph included elsewhere herein. The Compensation
Committee believes that the Company's most direct competitors for executive
talent in the San Francisco Bay Area are not necessarily the same companies to
which the Company would be compared for stock performance purposes. The Chief
Executive Officer's base salary was reviewed against the 75th percentile of the
comparative data.
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Annual Cash Incentives
The annual cash incentive is designed to provide a short-term
(one-year) incentive to executives, is based on the Company meeting certain
predetermined levels of pre-tax operating income, and is allocated among the
executives based on the Committee's assessment of the performance of each
executive, following consultation with the Chief Executive Officer. In addition,
cash incentive compensation may be granted by the Committee to certain
executives based on their performance of individual goals established in advance
by the Committee. These individual goals may include objective and subjective
factors, such as leadership and management skills, successful acquisitions or
financings and improved performance of assets. Annual cash incentives were
awarded to the Named Executive Officers, as indicated in the above Summary
Compensation Table, based on the Committee's evaluation of each Named Executive
Officer's contribution to the Company's performance in fiscal 2001.
Stock Options
Stock options are designed to provide long-term (ten-year) incentives
and rewards tied to the price of the Company's Class A Common Stock. Given the
fluctuations of the stock market, stock price performance and financial
performance are not always consistent. The Compensation Committee believes that
stock options, which provide value to participants only when the Company's
shareholders benefit from stock price appreciation, are an important component
of the Company's executive compensation program. The Compensation Committee has
not established any target level of ownership of Company Class A Common Stock by
the Company's executives. However, retention of shares of Company stock by
executives is encouraged.
On May 1, 2001, the Compensation Committee awarded 15,000 options to
Mr. Evans at an exercise price of $43.15 per share. The options vest at the rate
of 1/60 per month and expire ten years from the grant date.
E.I.C.P.
Like the 1993 Equity Plan, the E.I.C.P. was designed to provide
long-term (five-year) incentives and rewards tied to Company performance. Under
the E.I.C.P., the Compensation Committee made annual awards of units to
executive officers which earned a percentage of plan income based on the
Company's pre-tax net income, as more fully described in footnote 9 to the
Summary Compensation Table. The use of the E.I.C.P. as a regular element of
compensation for executive officers was discontinued upon adoption of the 1993
Equity Plan and no awards have been made since that time. However, pursuant to
the terms of the E.I.C.P., outstanding units will continue to accrue interest in
future years.
IRC Section 162(m)
Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), denies a deduction to any publicly held corporation for compensation
paid to certain covered employees in a taxable year to the extent such
compensation exceeds $1 million. Certain types of compensation, however,
including "performance-based compensation," are disregarded for purposes
of the deduction limitation. Awards of options and other stock-based incentives
under the Equity Plan are intended by the Compensation Committee to qualify for
the exclusion for performance-based compensation.
The foregoing report is given by the members of the Compensation
Committee, namely:
Anthony Greener Bartlett R. Rhoades
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PERFORMANCE GRAPH
The line graph below compares the cumulative total return to holders of
the Company's Common Stock in the period from June 30, 1996 to June 30, 2001,
with the cumulative total return in the same period on (i) the NASDAQ Stock
Market Index (U.S.) and (ii) a peer group index comprised of the following
companies whose returns have been weighted based on market capitalization as of
June 30, 2001: Chalone Wine Group, Ltd., Constellation Brands, Adolph Coors
Company, Anheuser-Busch Companies, Inc., Brown-Forman Corporation and Beringer
Wine Estates Holdings, Inc. (through October 2, 2000 when Beringer was delisted
as a consequence of its acquisition by Foster's). The graph assumes an
investment of $100.00 on June 30, 1996 in the Company and in the comparison
indices. "Total return," for purposes of the graph, assumes reinvestment of all
dividends.
[PERFORMANCE GRAPH]
The information contained in the performance graph shall not be deemed
to be "soliciting material" or to be "filed" with the SEC, nor shall such
information be incorporated by reference into any future filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934 (the "Exchange
Act"), except to the extent that the Company specifically incorporates it by
reference into such filing.
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Company's executive officers, directors and
greater-than-ten-percent beneficial owners are required under Section 16(a) of
the Exchange Act to file reports of ownership and changes in ownership with the
SEC. Copies of those reports must also be furnished to the Company.
Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that during fiscal 2000 all
filing requirements applicable to the Company's officers, directors and
greater-than-ten-percent beneficial owners under Section 16(a) of the Exchange
Act were complied with.
EMPLOYMENT AGREEMENT
In February 1993, Robert Mondavi entered into an agreement with the
Company which replaced his Personal Services Agreement executed in 1979. The
current agreement provides for a fixed annual salary of up to $500,000.
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CERTAIN TRANSACTIONS
Frank Farella is a partner in the law firm of Farella, Braun & Martel
which provides certain legal services to the Company. The Company also buys wine
grapes from Mr. Farella at market prices pursuant to a written agreement. The
Company paid Mr. Farella $199,000 for grapes during the fiscal year ended June
30, 2001.
In November, 1998 Michael Mondavi bought approximately 18 plantable
acres of land in Napa Valley from an unaffiliated third party. He has hired
Robert Mondavi Winery to develop and farm the land as vineyards, for which he
pays the winery a fee equal to $250 per plantable acre plus its costs of farm
labor, materials and equipment. From time to time Mr. Mondavi may sell grapes
from the vineyard to the Company at prevailing market prices.
It is the Company's current policy that all transactions by the Company
with its officers, directors, 5% shareholders and their affiliates will be
entered into only if such transactions are approved by a majority of the
disinterested directors, are on terms no less favorable to the Company than
could be obtained from unaffiliated parties and are reasonably expected to
benefit the Company.
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
(PROPOSAL 2 ON PROXY)
The firm of PricewaterhouseCoopers LLP has served as independent
accountants for the Company since fiscal 1978 and has been appointed by the
Audit Committee of the Board of Directors as the Company's independent
accountants for the fiscal year 2002, subject to ratification by the
shareholders at the Annual Meeting. Representatives of PricewaterhouseCoopers
LLP are expected to be available at the annual meeting to respond to appropriate
questions from shareholders and will have the opportunity to make a statement if
they wish.
AUDIT FEES
PricewaterhouseCoopers LLP billed the Company an aggregate of $210,000
for its professional services rendered for the audit of the Company's annual
financial statements for the fiscal year ended June 30, 2001 and its reviews of
the financial statements included in the Company's Quarterly Reports on Form
10-Q for that fiscal year.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
PricewaterhouseCoopers LLP was not engaged to provide financial
information system design and implementation services to the Company for the
fiscal year ended June 30, 2001.
ALL OTHER FEES
PricewaterhouseCoopers LLP billed the Company an aggregate of $252,000
for its services, other than those described in the two preceding items, for the
fiscal year ended June 30, 2001.
The Audit Committee has determined that Pricewaterhouse Coopers LLP's
provision of the services described above is compatible with maintaining its
independence.
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RECOMMENDATION
The Board of Directors recommends that shareholders vote FOR
ratification of the appointment of PricewaterhouseCoopers LLP as the Company's
independent accountants.
PROPOSED AMENDMENTS TO THE
1993 NON-EMPLOYEE DIRECTORS ' STOCK OPTION PLAN
(PROPOSAL 3 ON PROXY)
Shareholders are asked to ratify amendments to the 1993 Non-Employee
Directors' Stock Option Plan (the "Director Plan"), adopted by the Board of
Directors on July 11, 2001, which authorize discretionary grants of options in
addition to the non-discretionary grants now authorized by the plan, extend the
term of the plan by ten years and make certain technical changes to conform the
plan with recent changes in the federal securities laws. A copy of the Director
Plan with all proposed amendments is appended to this Proxy Statement.
ORIGINAL PLAN TERMS
At its adoption in February 1993 the Director Plan provided that each
non-employee director, at the commencement of his service as director, would
receive a non-discretionary, or automatic, award of options on shares of Class A
Common Stock with a market value of $150,000 at the date of grant. A total of
100,000 such shares were at that time reserved for issuance pursuant to
non-statutory options under the Director Plan. An additional 50,000 Class A
Common Shares were reserved for issuance under the Director Plan with
shareholder approval at the 2000 Annual Meeting.
In 1995 the Director Plan was amended to provide for annual
non-discretionary awards of 2,000 options per year to each non-employee
director. Both types of non-discretionary award were designed to comply with the
then applicable rules under Section 16(b)3 of the Securities Exchange Act of
1934. Those rules were later liberalized to permit discretionary awards to
non-employee directors.
DISCRETIONARY AWARDS
A discretionary award may be made, in the judgment of the Board of
Directors, to provide an individual director or directors with additional
incentives to further the interests of the Company and its shareholders. The
exercise price of the options is fixed by the board, but in practice is
typically the market value of the Class A Common Stock at the date of grant. The
vesting period and other terms of the options may likewise be fixed by the Board
of Directors.
Subject to approval by the shareholders of the proposed amendment, the
Board of Directors on July 11, 2001 awarded 2,500 options to Mr. Greer and 2,500
options to Mr. Greener. The options, which vest immediately, are exercisable at
$41.07 per share, the closing price of the Class A Common Stock on NASDAQ on the
date of grant. By terms of the award Messrs. Greer and Greener will each
receive, at the same $41.07 exercise price, 2,500 additional options if the
Company's return on invested capital (ROIC) for its fiscal year ended June 30,
2004 is 10.7% per annum or better; 2,500 additional options if that figure is
11.2% or better; and 2,500 additional options if that figure is 11.7% or better.
The Board of Directors may from time to time make other discretionary awards of
options to non-employee directors if the proposed amendment is approved by the
shareholders.
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EXTENSION OF TERM OF THE PLAN
The Director Plan will, unless it is extended, expire on February 25,
2003. The proposed amendment extends the term of the plan by ten years to
February 25, 2013. The amendment does not increase the number of shares of Class
A Common Stock that may be issued under the plan.
OTHER TECHNICAL AMENDMENTS
The proposed amendments also make technical changes to the Director
Plan to conform with recent changes in the federal securities laws. In
particular the amendments would allow a "cashless exercise" by which a
director's broker in effect loans the director the exercise price of an option,
which the director then repays from the sale proceeds of the shares he receives
on exercise of the option.
The Director Plan now allows an option granted to a non-employee
director to be transferred only by the director's will, the laws of descent and
distribution or pursuant to a qualified domestic relations order ("QDRO"). The
proposed amendments would, in addition, allow a non-employee director to
transfer an option by gift to members of his immediate family, a trust in which
members of his immediate family hold more than 50% of the beneficial interest,
or an entity in which members of his immediate family own more than 50% of the
voting interest.
Finally the Director Plan cannot now be amended more frequently than
once every six months with respect to those provisions which relate to the
amount, price and timing of grants, except where required to comport with
changes in the Internal Revenue Code, the Employee Retirement Income Security
Act, or the rules thereunder. In addition, in its current form any amendment to
the Director Plan requires shareholder approval if it would (i) increase the
number of shares available for issuance under the Director Plan (ii) modify the
requirements for eligibility under the Director Plan or (iii) modify the
Director Plan in any other way that would require shareholder approval under
Rule 16(b)3 of the Securities Exchange Act of 1934. The proposed amendments
would allow the Director Plan to be amended more often than once every six
months and would require shareholder approval of such amendments only when
required by the Internal Revenue Code, applicable exchange listing rules, or
federal, state and foreign securities law.
OTHER TERMS OF THE DIRECTOR PLAN
The Director Plan is administered by the Board of Directors, who may
delegate administration to a committee of two or more Board members. Options
granted under the Director Plan are taxed as non-statutory options under federal
income tax laws. Although the grant of a non-statutory stock option is generally
not taxable to the optionee, upon exercise of the option the optionee will be
taxed at ordinary income rates on the excess of the fair market value of the
stock received over the option exercise price. The amount included in an
individual's income as a result of the exercise of a non-statutory option will
be treated as the individual's basis in the shares acquired, and any further
gain or loss upon subsequent sale of the shares will be treated as long-term or
short-term capital gain or loss as the case may be.
RECENT STOCK PRICE
The closing price of the Class A Common Stock on September 14, 2001, as
reported on the NASDAQ Stock Market, was $42.27 per share. A total of 106,729
options have been granted under the Director Plan, of which 2,624 options have
been forfeited and 10,721 options have been exercised.
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RECOMMENDATION
The Board of Directors recommends that shareholders vote FOR
ratification of the proposed amendments to the Director Plan. If this proposal
is not approved, then the plan will remain in effect as previously adopted and
amended.
OTHER MATTERS
GENERAL
The Board of Directors does not know of any business to be presented at
the Annual Meeting other than the matters described above. If any other business
should properly come before the meeting, it is the intention of the persons
named in the proxies to vote in accordance with the recommendation of the Board
of Directors. Discretionary authority for them to do so is contained in the
proxy cards.
DEADLINE FOR SHAREHOLDER PROPOSALS
Any shareholder proposal intended for presentation at the 2002 Annual
Meeting must be received by the Secretary of the Company at the Company's
principal executive offices located at 7801 St. Helena Highway, Oakville,
California 94562 by June 1, 2002 for inclusion in the Company's proxy materials
related to that meeting.
The Bylaws of the Company provide that in order for a shareholder to
bring business before or propose director nominations at an Annual Meeting, the
shareholder must give written notice to the Secretary of the Company not less
than sixty (60) days nor more than ninety (90) days prior to the date of the
Annual Meeting. The notice must contain specified information about the proposed
business or each nominee and about the shareholder making the proposal or
nomination. In the event that less than 70 days' notice or prior public
disclosure of the date of the Annual Meeting is given or made to shareholders,
notice by the shareholder in order to be timely must be received no later than
the close of business on the tenth day following the date on which such notice
of the Annual Meeting date was mailed or public disclosure of the date of the
Annual Meeting was made, whichever first occurs.
By Order of the Board of Directors,
/s/ Mike Beyer
Mike Beyer
Secretary
September 28, 2001
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Robert Mondavi
Audit Committee Charter
PURPOSE
The purpose of the Audit Committee is to support the oversight function
of the Board of Directors of the Company over the Company's processes for
accounting; financial reporting; and monitoring compliance with laws,
regulations and the Company's corporate code of conduct. The Audit Committee
shall perform this function through the periodic review of the Company's
processes for producing financial data and identifying and controlling key
business, financial and other risks. The Audit Committee shall also review the
adequacy of the Company's internal controls and the independence of its
independent auditor.
MEMBERSHIP
The Audit Committee shall consist of such number of members of the
Board of Directors of the Company as shall be designated by the Board from time
to time, but in no event shall the Committee consist of less than three members.
All members of the Committee shall be competent to perform the responsibilities
and duties of the Committee. All members of the Committee shall be able to read
and understand fundamental financial statements and at least one member of the
Committee shall have accounting or related financial management expertise as
defined in the National Association of Securities Dealers (NASD) rules and
regulations. The Chairperson of the Committee shall be selected by the Board of
Directors. None of the members of the Committee shall be employed by the Company
or any of its subsidiaries, nor shall any member of the Committee have been so
employed within the three years preceding appointment to the Committee. In
addition, each member of the Committee shall be independent of management of the
Company, as defined by NASD rules and regulations, and shall be free from any
relationship that, in the opinion of the Board of Directors of the Company,
would interfere with the exercise of independent judgment by such Committee
member. The Committee is expected to conduct meetings at least four times per
fiscal year.
FUNCTIONS AND POWERS
The Audit Committee shall:
INDEPENDENT AUDITOR
1. Recommend to the Board of Directors the firm to be employed as the
Company's independent auditor, instruct the independent auditor that
the Board of Directors is its client and review the proposed
discharge of such firm;
2. Review the independent auditor's compensation, the proposed terms of
its engagement, and its independence;
3. Receive annually a written statement from the independent auditor
delineating all relationships between the independent auditor and
the Company and assess the effect of any such relationships on such
auditor's objectivity and independence;
4. Engage in a dialogue with the independent auditor with regard to
disclosed relationships or services and assess the effect of any
such relationships or services on such auditor's objectivity and
independence;
5. Review the scope and results of each independent audit of the
Company, the reports of the audit, any related management letter,
and management's responses to recommendations made by the
independent auditor in connection with the audit;
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6. Ensure that the independent auditor keeps the Committee informed
about fraud, illegal acts, deficiencies in internal controls and
certain other matters;
FINANCIAL REPORTING
7. Review the Company's quarterly and annual financial reports,
including the Audit Committee Questionnaire, management's
discussion and analysis, any certification, report, opinion, or
review rendered by the independent auditor in connection therewith;
and any communications required by professional standards between
the independent auditor and the Audit Committee prior to the public
release of such information;
8. Consider major changes and other major questions of choice
regarding the appropriate accounting principles and practices to
be used in the preparation of the Company's financial statements;
9. Ensure that the independent auditor brings areas that require
judgement or the use of estimates to the Committee's attention;
10. Review with financial management and the independent auditor their
qualitative judgments about the appropriateness, not just
acceptability, of accounting principles, estimates and financial
disclosure practices used in the preparation of the Company's
financial statements and other public reports;
11. Consider management's handling of proposed audit adjustments
identified by the independent auditor;
INTERNAL CONTROL STRUCTURE
12. Consider, in consultation with the Company's financial management
and the independent auditor, the adequacy of the Company's internal
controls;
OTHER
13. Review the effectiveness of the Company's system for monitoring
compliance with laws and regulations, obtaining periodic updates
from management and general counsel;
14. Review the findings of any examinations by regulatory agencies;
15. Review with the Company's counsel, any legal matters that could
have a significant impact on the Company's financial statements;
16. Ensure significant findings and recommendations made by the
independent auditor are addressed on a timely basis;
17. Meet with the independent auditor in separate executive session;
18. Serve as a channel of communication between the independent auditor
and the Board of Directors;
19. Inquire into any other financial matters not set forth above which
the Committee in its judgment determines to be necessary, by either
investigating such matter on its own, referring such matter to the
Board of Directors or requesting management of the Company to
conduct an appropriate investigation;
20. Annually review this charter and revise it as conditions dictate;
21. Report regularly to the Board of Directors on matters within the
scope of the Committee as well as any special problems that merit
the attention of the Board of Directors; and
22. Perform such other duties as the Board of Directors may from time
to time assign to it.
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THE ROBERT MONDAVI CORPORATION
1993 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
Adopted on February 26, 1993
Approved by Shareholders on February 26, 1993
Amended and Restated on December 14, 1994
Amended and Restated on July 11, 2001
1. PURPOSE
(a) The purpose of the 1993 Non-Employee Directors' Stock Option Plan
(the "Plan") is to provide a means by which each director of The Robert Mondavi
Corporation (the "Company") who is not otherwise an employee of the Company or
of any Affiliate of the Company (each such person being hereafter referred to as
a "Non-Employee Director") will be given an opportunity to purchase stock of the
Company.
(b) The word "Affiliate" as used in the Plan means any parent
corporation or subsidiary corporation of the Company as those terms are defined
in Sections 424(e) and (f), respectively, of the Internal Revenue Code of 1986,
as amended from time to time (the "Code").
(c) The Company, by means of the Plan, seeks to retain the services of
persons now serving as Non-Employee Directors of the Company, to secure and
retain the services of persons capable of serving in such capacity, and to
provide incentives for such persons to exert maximum efforts for the success of
the Company.
2. ADMINISTRATION
(a) The Plan shall be administered by the Board of Directors of the
Company (the "Board") unless and until the Board delegates administration to a
committee, as provided in subparagraph 2(b).
(b) The Board may delegate administration of the Plan to a committee
composed of not fewer than two (2) members of the Board (the "Committee"). If
administration is delegated to a Committee, the Committee shall have, in
connection with the administration of the Plan, the powers theretofore possessed
by the Board, subject, however, to such resolutions, not inconsistent with the
provisions of the Plan, as may be adopted from time to time by the Board. The
Board may abolish the Committee at any time and revest in the Board the
administration of the Plan.
3. SHARES SUBJECT TO THE PLAN
(a) Subject to the provisions of paragraph 11 relating to adjustments
upon changes in stock, the stock that may be sold pursuant to options granted
under the Plan shall not exceed in the aggregate one hundred and fifty thousand
(150,000) shares of the Company's Class A Common Stock. If any option granted
under the Plan shall for any reason expire or otherwise terminate without having
been exercised in full, the stock not purchased under such option shall again
become available for the Plan.
(b) The stock subject to the Plan may be unissued shares or reacquired
shares, bought on the market or otherwise.
4. ELIGIBILITY
Options shall be granted only to Non-Employee Directors of the Company.
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22
5. NON-DISCRETIONARY GRANTS
(a) Upon the date of the approval of the Plan by the Board (the
"Adoption Date"), each person who is then a Non-Employee Director shall be
granted an option to purchase twelve thousand (12,000) shares of Class A Common
Stock of the Company on the terms and conditions set forth herein.
(b) After the Adoption Date and prior to the date of the Company's
first underwritten registration of an offering of securities of the Company
under the Securities Act of 1933, as amended (the "IPO"), each person who is
elected for the first time to be a Non-Employee Director shall, upon the date of
his or her initial election to be a Non-Employee Director by the Board or
shareholders of the Company, be granted an option to purchase twelve thousand
(12,000) shares of Class A Common Stock of the Company on the terms and
conditions set forth herein.
(c) After the date of the Company's IPO, each person who is elected for
the first time to be a Non-Employee Director shall, upon the date of his or her
initial election to be a Non-Employee Director by the Board or the shareholders
of the Company, be granted an option to purchase that whole number of shares of
the Company's Class A Common Stock closest to the number determined by dividing
one hundred fifty thousand (150,000) by the closing price per share of the
Company's Class A Common Stock as reported on the NASDAQ National Market System
on the date each such Non-Employee Director is elected, on the terms and
conditions set forth herein.
(d) Each person serving as a Non-Employee Director on December 14, 1994
shall be granted: (i) an option to purchase three thousand (3,000) shares of
Class A Common Stock of the Company on the terms and conditions set forth herein
on the date of approval of the Plan, as amended and restated, by the Board; and
(ii) subsequent options on the terms and conditions set forth herein to purchase
an additional two thousand five hundred (2,500) shares on the date of the 1995
Annual Meeting of Shareholders of the Company, two thousand (2,000) shares on
the date of the 1996 Annual Meeting of Shareholders of the Company, and two
thousand (2,000) shares on the date of each subsequent Annual Meeting of
Shareholders of the Company; provided, however, that such person has provided
continuous service as a Non-Employee Director to the Company since December 14,
1994 and until the applicable subsequent grant date.
(e) Each person who is elected for the first time to be a Non-Employee
Director on or after December 15, 1994 shall be granted, on the terms and
conditions set forth herein: (i) on the date of the first Annual Meeting of
Shareholders of the Company following such election, an option to purchase 5.48
shares of the Company's Class A Common Stock for each day of continuous service
as a Non-Employee Director provided since such Non-Employee Director's initial
election until (but not including) the date of such Annual Meeting (rounded to
the next highest whole share); and (ii) on the date of each subsequent Annual
Meeting of Shareholders of the Company thereafter, an option to purchase an
additional two thousand (2,000) shares; provided, however, that such person has
provided continuous service as a Non-Employee Director to the Company since his
or her date of election and until the applicable subsequent grant date.
(f) The exercise price per share of each option granted under this
paragraph 5 of the Plan shall be equal to the fair market value of a share of
Class A Common Stock on the date of grant, as determined by the Board or the
Committee.
(g) The shares covered by an option issued pursuant to this paragraph 5
shall become exercisable ("vest") as follows:
(i) With respect to any option granted under the provisions of
subparagraph 5(a), (b) or (c), in equal monthly installments of 1.667% of such
shares over a period of five (5) years after the date the option is granted; and
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(ii) With respect to any option granted under the provisions of
subparagraph 5(d) or (e), in equal monthly installments over a period of twelve
(12) months after the date the option is granted;
provided, however, that the optionee has during the entire period prior to such
vesting date, continuously served as a Non-Employee Director or as an employee
of or consultant to the Company or any Affiliate of the Company.
6. DISCRETIONARY GRANTS
(a) Non-Employee Directors may, at the discretion of the Board or the
Committee, be granted options to purchase shares of the Company's Class A Common
Stock in addition to the non-discretionary options granted under paragraph 5 of
the Plan. The Board or the Committee shall have full authority to determine
which Non-Employee Directors of the Company shall receive discretionary option
grants pursuant to this paragraph 6, the time or times when such option grants
shall be made and the number of shares subject to each grant.
(b) The exercise price per share of each option granted under this
paragraph 6 of the Plan shall be determined by the Board or the Committee in its
discretion.
(c) The shares covered by an option issued pursuant to this paragraph 6
shall become exercisable ("vest") in accordance with a schedule as determined by
the Board or the Committee in its discretion.
7. OPTION PROVISIONS
Each option shall contain the following terms and conditions:
(a) The term of each option commences on the date it is granted and,
unless sooner terminated as set forth herein, expires ten (10) years from the
date of grant (the "Expiration Date"). If the optionee's service as a
Non-Employee Director of the Company terminates for any reason or for no reason,
the option shall terminate on the earlier of the Expiration Date or the date one
hundred eighty (180) days after the date of termination of such services;
provided, however, that if such termination is due to the optionee's death or
permanent disability, the option shall terminate on the earlier of (i) the
Expiration Date or (ii) the date that occurs one hundred eighty (180) days after
the optionee's "period of service" as a director would have ended under the
Company's written policy (in effect as of the date the option is granted)
regarding tenure of the members of the Company's Board of Directors had such
director been able to complete the full period of service as a member of the
Company's Board of Directors permitted under such policy. In any and all
circumstances, an option may be exercised following termination of the
optionee's service as a Non-Employee Director of the Company only as to that
number of shares as to which it was exercisable on the date of termination of
such services under the provisions of subparagraphs 5(g) and 6(c).
(b) Payment of the exercise price of each option is due in full in cash
upon any exercise when the number of shares being purchased upon such exercise
is less than one hundred (100) shares; but when the number of shares being
purchased upon an exercise is one hundred (100) or more shares, the optionee may
elect to make payment of the exercise price under one of the following
alternatives:
(i) Payment of the exercise price per share in cash at the time of
exercise;
(ii) Provided that at the time of the exercise the Company's Class A
Common Stock is publicly traded and quoted regularly in the Wall Street Journal,
payment by delivery of shares of Class A Common Stock of the Company already
owned by the optionee, held for the period required to avoid a
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24
charge to the Company's reported earnings, and owned free and clear of any
liens, claims, encumbrances or security interest, which Class A Common Stock
shall be valued at fair market value (as determined in good faith by the Board)
on the date preceding the date of exercise;
(iii) Provided that at the time of the exercise the Company's Class A
Common Stock is publicly traded and quoted regularly in the Wall Street Journal,
payment by cashless exercise methods which are permitted by law, including,
without limitation, methods whereby a broker sells the shares to which the
exercise relates or holds them as collateral for a margin loan, delivers the
aggregate exercise price to the Company, and delivers the remaining proceeds to
the optionee (and in connection therewith, the Company may establish a cashless
exercise program including a program where the commissions on the sale of the
shares to which the exercise relates are paid by the Company); or
(iv) Payment by a combination of the methods of payment specified in
subparagraphs 7(b)(i), 7(b)(ii) and 7(b)(iii) above.
(c) An option may be transferred by will or by the laws of descent and
distribution, and during the lifetime of the optionee, by gift and or pursuant
to a domestic relations order to members of the optionee's Immediate Family to
the extent and in the manner determined by the Board of the Committee.
"Immediate Family" means any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in law, daughter-in-law, brother-in-law, or sister-in-law,
including adoptive relationships, any person sharing the optionee's household
(other than a tenant or employee), a trust in which these persons (or the
optionee) have more than fifty percent (50%) of the beneficial interest, a
foundation in which these persons (or the optionee) control the management of
assets, and any other entity in which these persons (or the optionee) own more
than fifty percent (50%) of the voting interests. The optionee may, by
delivering written notice to the Company, in a form satisfactory to the Company,
designate a third party who, in the event of the death of the optionee, shall
thereafter be entitled to exercise the option.
(d) The Company may require any optionee, or any person to whom an
option is transferred under subparagraph 7(c), as a condition of exercising any
such option: (i) to give written assurances satisfactory to the Company as to
the optionee's knowledge and experience in financial and business matters; and
(ii) to give written assurances satisfactory to the Company stating that such
person is acquiring the stock subject to the option for such person's own
account and not with any present intention of selling or otherwise distributing
the stock. These requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (i) the issuance of the shares upon the
exercise of the option has been registered under a then-currently-effective
registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), or (ii), as to any particular requirement, a determination is
made by counsel for the Company that such requirement need not be met in the
circumstances under the then-applicable securities laws. The Company may, upon
advice of counsel to the Company, place legends on stock certificates issued
under the Plan as such counsel deems necessary or appropriate in order to comply
with applicable securities laws, including, but not limited to, legends
restricting the transfer of the stock.
(e) Notwithstanding anything to the contrary contained herein, an
option may not be exercised unless the shares issuable upon exercise of such
option are then registered under the Securities Act or, if such shares are not
then so registered, the Company has determined that such exercise and issuance
would be exempt from the registration requirements of the Securities Act.
(f) The Company (or a representative of the underwriters) may, in
connection with the filing of a registration statement of the Company filed
under the Securities Act, require that any optionee not sell or otherwise
transfer or dispose of any shares of common stock or other securities of the
Company during such period (not to exceed one hundred eighty (180) days)
following the effective date (the
4
25
"Effective Date") of the registration statement of the Company filed under the
Securities Act as may be requested by the Company or the representative of the
underwriters.
8. COVENANTS OF THE COMPANY
(a) During the terms of the options granted under the Plan, the Company
shall keep available at all times the number of shares of stock required to
satisfy such options.
(b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell shares of stock upon exercise of the options granted under the
Plan; provided, however, that this undertaking shall not require the Company to
register under the Securities Act either the Plan, any option granted under the
Plan, or any stock issued or issuable pursuant to any such option. If, after
reasonable efforts, the company is unable to obtain from any such regulatory
commission or agency the authority which counsel for the Company deems necessary
for the lawful issuance and sale of stock under the Plan, the Company shall be
relieved from any liability for failure to issue and sell stock upon exercise of
such options.
9. USE OF PROCEEDS FROM STOCK
Proceeds from the sale of stock pursuant to options granted under the
Plan shall constitute general funds of the Company.
10. MISCELLANEOUS
(a) Neither an optionee nor any person to whom an option is transferred
under subparagraph 7(c) shall be deemed to be the holder of, or to have any of
the rights of a holder with respect to, any shares subject to such option unless
and until such person has satisfied all requirements for exercise of the option
pursuant to its terms.
(b) Nothing in the Plan or in any instrument executed pursuant thereto
shall confer upon any Non-Employee Director any right to continue in the service
of the Company or any Affiliate or shall affect any right of the Company, its
Board or stockholders or any Affiliate to terminate the service of any
Non-Employee Director with or without cause.
(c) No Non-Employee Director, individually or as a member of a group,
and no beneficiary or other person claiming under or through him, shall have any
right, title or interest in or to any option reserved for the purposes of the
Plan except as to such shares of Class A Common Stock, if any, as shall have
been reserved for him pursuant to an option granted to him.
(d) In connection with each option made pursuant to the Plan, it shall
be a condition precedent to the Company's obligation to issue or transfer shares
to a Non-Employee Director, or to evidence the removal of any restrictions on
transfer, that such Non-Employee Director make arrangements satisfactory to the
Company to insure that the amount of any federal or other withholding tax
required to be withheld with respect to such sale or transfer, or such removal
or lapse, is made available to the Company for timely payment of such tax.
11. ADJUSTMENTS UPON CHANGES IN STOCK
(a) If any change is made in the stock subject to the Plan, or subject
to any option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or otherwise), the Plan and outstanding
options will be appropriately
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26
adjusted in the class(es) and maximum number of shares subject to the Plan and
the class(es) and number of shares and price per share of stock subject to
outstanding options.
(b) In the event of: (1) a dissolution or liquidation of the Company;
(2) a merger or consolidation in which the Company is not the surviving
corporation; (3) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's Class A Common Stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, whether in the form of securities, cash or otherwise; or (4) any
other capital reorganization in which more than fifty percent (50%) of the
shares of the Company entitled to vote are exchanged, then the time during which
such option may be exercised shall be accelerated and the options terminated if
not exercised prior to such event.
12. AMENDMENT OF THE PLAN
(a) The Board at any time, and from time to time, may amend the Plan.
To the extent necessary to comply with Applicable Laws, the Company shall obtain
shareholder approval of any Plan amendment in such a manner and to such a degree
as required. "Applicable Laws" means the legal requirements relating to the
administration of stock incentive plans, if any, under applicable provisions of
federal securities laws, state corporate and securities laws, the Code, the
rules of any applicable stock exchange or national market system, and the rules
of any foreign jurisdiction applicable to options granted to residents therein.
(b) Rights and obligations under any option granted before any
amendment of the Plan shall not be impaired by such amendment unless (i) the
Company requests the consent of the person to whom the option was granted and
(ii) such person consents in writing.
13. TERMINATION OR SUSPENSION OF THE PLAN
(a) The Board may suspend or terminate the Plan at any time. Unless
sooner terminated, the Plan shall terminate on February 25, 2013. No options may
be granted under the Plan while the Plan is suspended or after it is terminated.
(b) Rights and obligations under any option granted while the Plan is
in effect shall not be impaired by suspension or termination of the Plan, except
with the consent of the person to whom the option was granted.
(c) The Plan shall terminate upon the occurrence of any of the events
described in subparagraph 11(b) above.
14. EFFECTIVE DATE OF PLAN; CONDITIONS OF EXERCISE
(a) The Plan, as amended and restated, shall become effective upon
adoption by the Board of Directors, subject to the condition subsequent that the
Plan is approved by the stockholders of the Company.
(b) Notwithstanding any other provision in the Plan to the contrary, no
option granted under the Plan on or after December 14, 1994 shall be exercised
or exercisable unless and until the condition of subparagraph 14(a) above has
been met.
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PROXY
THE ROBERT MONDAVI CORPORATION
CLASS A COMMON STOCK PROXY
FOR ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 2, 2001
The undersigned hereby appoints Gregory M. Evans and Michael K. Beyer,
or either of them, each with power of substitution, as proxies to represent the
undersigned at the Annual Meeting of Shareholders of THE ROBERT MONDAVI
CORPORATION to be held at the Napa Valley Marriott, 3425 Solano Avenue, Napa,
California 94558 on Friday, November 2, 2001 at 10:00 a.m., and any adjournment
thereof, and to vote the number of shares of the CLASS A COMMON STOCK OF THE
ROBERT MONDAVI CORPORATION that the undersigned would be entitled to vote if
personally present.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
ROBERT MONDAVI CORPORATION. THIS PROXY WILL BE VOTED AS DIRECTED. IN THE ABSENCE
OF DIRECTION, THIS PROXY WILL BE VOTED FOR THE NOMINEES FOR ELECTION, FOR THE
RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AND FOR THE
PROPOSED AMENDMENTS TO THE DIRECTOR STOCK OPTION PLAN. In their discretion, the
proxy holders are authorized to vote upon such other business as may properly
come before the meeting or any adjournment thereof to the extent authorized by
Rule 14a-4(c) promulgated by the Securities and Exchange Commission and by
applicable state laws (including matters that the proxy holders do not know, a
reasonable time before this solicitation, are to be presented).
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
28
Please
mark
your
votes as X
indicated
in this
example
1. ELECTION OF DIRECTORS TO BE FOR WITHHOLD
ELECTED BY HOLDERS OF CLASS A the nominees AUTHORITY
COMMON STOCK, VOTING AS A CLASS listed to vote for
(except as the nominees
marked to listed:
the contrary).
/ / / /
NOMINEES: Frank E. Farella
Philip Greer
Bartlett R. Rhoades
To withhold authority to vote for an individual nonimee, write
such nominee's name below
-----------------------------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT OF FOR AGAINST ABSTAIN
PRICEWATERHOUSECOOPERS LLP AS
INDEPENDENT ACCOUNTANTS FOR THE FISCAL / / / / / /
YEAR:
3. To approve amendments to the 1993 FOR AGAINST ABSTAIN
Non-Employee Directors' Stock
Option Plan to authorize / / / / / /
discretionary grants of options
in addition to the
non-discretionary grants now
authorized, to extend the term of
the plan by ten years to February
25, 2013, and to make certain
technical changes to conform the
plan with recent changes in the
federal securities laws
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER(S). IF NO CHOICE IS SPECIFIED, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF EACH OF THE NOMINEES FOR DIRECTOR AND FOR PROPOSAL 2
AND PROPOSAL 3 LISTED ABOVE.
YES NO
I PLAN TO ATTEND THE MEETING / / / /
PROXY INSTRUCTIONS
1. Please sign exactly as the name or names appear on your
stock certificates (as indicated hereon).
2. If the shares are issued in the name of two or more
persons, all of them must sign the proxy.
3. A proxy executed by a corporation must be signed in its
name by an authorized officer.
4. Executors, administrators, trustees and partners should
indicate their capacity when signing.
The undersigned acknowledges receipt of (a) the Notice of 2001 Annual Meeting of
Shareholders, (b) the accompanying Proxy Statement and (c) Company's Annual
Report pursuant to SEC Rule 14a-3 for the fiscal year ended June 30, 2001.
Signature(s)
___________________________________________________________________
Dated: ______________, 2001
FOLD AND DETACH HERE