Item
10. Directors, Named Executive Officers and Corporate
Governance
The
following information sets forth the principal occupation, or employment
and
principal business of the employer, if any, of each director, as well
as his
age, business experience, other directorships held by him, and the period
during
which he has previously served as director of the Company.
Alex
Trevino, Jr., age 71, has served
as President and Chief Executive Officer of the Company since
1990. Mr. Trevino earned a BA from Rice University in 1958, and a BS
in Mechanical Engineering in 1959. Mr. Trevino has owned and managed
wholesale businesses in the HVAC industry for over 40 years. Mr.
Trevino has been a member of the Board since 1982, serving as
Chairman since 1988.
Alan
D. Feinsilver, age 59, is the
President of The Overbrook Company, a private company with emphasis on
real
estate and other investments. Mr. Feinsilver also serves as Vice
President of HGG Investments, Inc, a private investment entity. Mr.
Feinsilver is also a member of the Board of Directors and serves as Chairman
of
the Audit Committee of Equus II, Incorporated, a publicly traded company
listed on the New York Stock Exchange. None of these entities is
related to the Company. Mr. Feinsilver has been a member of the Board
since 2001.
Anthony
R. Maresca, age 56, has been
employed by the Company since 1985, serving as Controller until 1985
when he
became Senior Vice President, Chief Financial Officer and
Treasurer. Mr. Maresca earned a BA from Rice University in 1972, and
is a certified public accountant, and has been a member of the Board
since
1986.
Thomas
J. Reno, age 65, is the
President of Thomas J. Reno & Associates, Inc. Mr. Reno
provides consulting services to client organizations in all aspects of
human
resource management, compensation and benefits. Prior to starting
Thomas J. Reno & Associates, Mr. Reno served with KPMG, LLP, as
Partner-in-Charge of the Central Region Compensation & Benefits Consulting
Practice. Neither of these entities is related to the
Company. Mr. Reno has been a member of the Board since August,
2005.
Jo
E. Shaw, Jr., age 73, is an attorney
and has practiced law continuously since 1959. He was President of
Shaw & Associates, a law firm specializing in the practice of real estate,
mortgage lending and bankruptcy law, where he represented many national
mortgage
companies. He also is a former director, major shareholder and legal
counsel for a small bank in Texas. For many years, Mr. Shaw also held
leadership positions, as mayor, councilman, city attorney and municipal
judge,
in two small, incorporated cities in the immediate Houston area. Mr.
Shaw has been a member of the Board since January, 2006.
Roland
H. St. Cyr, age 77, owned and
managed Hallmark Air Conditioning, Inc. ("Hallmark"), an HVAC service
company
based in Houston, Texas from 1974 to 1997, at which time he sold and
became a
consultant to the business. Hallmark is not related to the
Company. Mr. St. Cyr has been a member of the Board since
1998.
A.
Stephen Trevino, age 44, has been
employed by the Company as General Counsel since March 1999, was elected
Vice
President and Secretary in 2000, and Senior Vice President in
2003. Mr. Trevino is the son of Alex Trevino, Jr., Chairman of the
Board and Chief Executive Officer of the Company. Mr. Trevino earned
a BBA from The University of Texas in 1984 and a JD from The University
of Texas
School of Law in 1987. Mr. Trevino is licensed to practice law in the
State of Texas, and has been a member of the Board since 1997.
Marshall
G. Webb, age 64, is founder
and President of Polaris Group, which he organized in 1999 to provide
financial
advisory and merger and acquisition services to public and private
companies. Prior to founding Polaris, he founded, was CEO and led the
IPO of a global provider of information technology solutions to government
and
business. Mr. Webb was an owner and executive officer for 18 years of
several major staff augmentation and outsourcing companies. He also
is a director of Isolagen, Inc. and Teletouch Communications, Inc., two
other
publicly traded companies that are listed on the American Stock
Exchange. Mr. Webb is a certified public accountant and holds a
Certificate of Director Education, a nationally recognized designation
for
corporate directors. Mr. Webb has been a member of the Board since
January, 2006.
Michael
F.
Knoop, age 63, has been employed by the Company since 1998 and serves
as the
President of the Florida Cooling Supply, Inc. business unit.
Ronnie
G.
Floyd, age 62, has been employed by the Company since 1991 and serves
as the
President of the Total Supply Inc. business unit.
Meetings
and Committees of the Board
Board
Meetings
The
Board met four times during fiscal
2007. All members of the Board attended each meeting, including the
Board’s annual meeting. No director attended less than 75% of the
total number of meetings held by the committees of the Board on which
the
director served.
Audit
Committee
The
Audit
Committee (i) reviews the independence, qualifications and performance
of the
Company’s independent public accountants, recommends their retention to the
entire board, and reviews the final report of the independent accountants;
(ii)
reviews the procedures employed by the Company in the preparation of
its
financial statements; (iii) reviews known or suspected violations of
policies
and procedures set forth in the Code of Business Conduct and Ethics and
applicable laws and regulations; (iv) pre-approves all audit and non-audit
services provided by the independent accountants; (v) reviews with the
Chief
Financial Officer and independent accountants corporate accounting practices
and
policies and financial controls; and (vi) performs all other duties as
the Board
may from time to time designate.
The
Audit Committee is comprised of
Messrs. Webb (Chairman), Feinsilver, and St. Cyr, each of whom is an
independent
director as defined under the listing requirements of the American Stock
Exchange (the “AMEX”). The Board has determined that Messrs. Webb and
Feinsilver each qualify as an “audit committee financial expert” under federal
securities laws. The Audit Committee members are not professional
accountants or auditors, and their role is not intended to duplicate
or certify
the activities of management and the independent accountants. The
Audit Committee held four meetings during fiscal 2007, at which all members
were
present.
The
Audit Committee has a written
charter adopted by the Board of Directors in fiscal 2006 that can be
found on
the Company’s website, www.acrgroup.com.
Compensation
Committee
The
Compensation Committee is comprised
of Messrs. St. Cyr (Chairman), Feinsilver and Reno, each of whom is an
independent director as defined under the listing requirements of the
AMEX. The Compensation Committee is responsible for overseeing the
Company’s executive compensation programs and making recommendations to the
entire Board regarding compensation of the Company’s executive officers in order
to ensure the attraction and retention of talented senior corporate executives,
to motivate and reward their performance in the achievement of the Company’s
business objectives, and to align their interests with the long-term
interests
of the Company’s shareholders. The Company’s compensation strategy has
increasingly linked compensation to performance of the Company and the
creation
of shareholder value tied to the long-term performance of the
Company. The Compensation Committee held three meetings
during fiscal 2006, at which all members were present.
The
Compensation Committee has a
written charter that can be found on the Company’s website,
www.acrgroup.com.
Nominating Committee
The
Nominating Committee is comprised
of Messrs. Shaw (Chairman), Reno and St. Cyr, each of whom is an independent
director as defined under the listing requirements of the AMEX. The
Nominating Committee is responsible for evaluating and nominating potential
candidates to become members of the Board, and evaluating current members
of the
Board. The Nominating Committee does not yet have a written policy
that governs the consideration of shareholder-recommended director candidates,
but will consider candidates recommended by shareholders on a case-by-case
basis. Shareholders who desire to recommend a candidate for service
on the Board should provide such recommendation to the Chairman of the
Nominating Committee in accordance with applicable securities laws. A
candidate for consideration must have an educational background and business
experience that would likely result in a meaningful contribution being
made by
such candidate to the Board. Candidates must possess unquestionable
integrity and have a strong reputation in the community. The
Committee will evaluate candidates submitted by shareholders with the
same
criteria that it uses for all other candidates.
The
Nominating Committee has a written
charter that can be found on the Company’s website,
www.acrgroup.com.
Section 16(a) Beneficial
Ownership Reporting Compliance
Each
director, and certain officers and
shareholders of the Company are required to report to the Securities
and
Exchange Commission, by a specified date, his transactions related to
common
stock of the Company. Based solely on a review of the copies of reports
furnished to the Company or written representations that no other reports
were
required, the Company believes that during fiscal 2007 all filing requirements
were met in all material respects.
Code
of Ethics and Business Conduct
The
Company has prepared and adopted a
written code of ethics applicable to all of the Company’s officers and
employees. The code restates the Company’s practices of requiring
honest and ethical conduct, including handling of apparent and actual
conflicts
of interest, full, fair, accurate, timely, and understandable disclosure
in
reports and documents filed or submitted, compliance with all applicable
laws,
rules and regulations, prompt reporting of violations of the code and
accountability for adherence to the code. The Code of Business
Conduct and Ethics can be found on the Company’s website,
www.acrgroup.com.
Item
11.
|
Executive
Compensation
|
Compensation
Discussion and Analysis
Overview
This
compensation discussion and analysis explains the Company’s policies and
philosophies regarding executive compensation and the material elements
of the
compensation earned by, and paid to each of the Company’s executive officers and
two other most highly compensated employees during the last completed
fiscal
year.
Compensation
Policies and Philosophy
The
Compensation Committee currently oversees the design and administration
of the
Company’s executive compensation program. The Compensation Committee’s
primary objectives in structuring and administering our executive officer
compensation program are to: attract, reward and retain executive officers
who
contribute to the Company’s success; provide economic incentives for executive
officers to achieve the Company’s business and financial objectives by linking
the executive officers’ compensation to the performance of the Company;
strengthen the relationship between executive pay and stockholder value;
and
reward individual performance.
To
achieve these objectives, the Compensation Committee endeavors to implement
and
maintain compensation packages that are performance-oriented and designed
to
link the Company’s strategic business objectives, specific financial performance
objectives and the enhancement of shareholder returns with the compensation
of
the Company’s executives, including the Named Executive Officers, using a
combination of base salary, cash bonuses and restricted stock awards. The
Compensation Committee evaluates, among other things, the following factors
for
each of the executives; (1) specialized education and training, and work
experience; (2) the individual’s work ethic and ability to perform required
tasks; (3) the individual’s knowledge of his or her job; and (4) the
individual’s ability to work with others toward the achievement of the Company’s
goals. The Compensation Committee also evaluates corporate performance by
considering factors such as the Company’s performance relative to the business
environment and the success of the Company in meeting its business and
financial
objectives. In reviewing the above listed factors regarding both
individual and corporate performance, the Compensation Committee relies
on its
subjective evaluation. The Company believe that it is important
to reward excellence, leadership and outstanding long-term company performance
in a form designed to retain and motivate executives while aligning their
incentives with continued high levels of performance.
The
Compensation Committee’s practice is to establish the annual compensation
packages for our executive officers near the start of the fiscal
year. The Compensation Committee may conduct additional analyses of
compensation trends and assessments of the Company’s competitive position at
other times during the year to address changes in the market for executive
services or special circumstances affecting the Company.
Components
of Compensation
The
compensation of executive officers consists of three principal components:
base
salary, cash incentive bonuses and grants of restricted stock. The Compensation
Committee believes that the combination of these elements is essential
to
attracting and retaining talented and hard-working individuals and aligning
their incentives with the interests of our stockholders. The Compensation
Committee does not adopt express formulae for weighting different elements
of
compensation or for allocating between long-term and short-term compensation
but
strives to develop comprehensive packages that are competitive with those
offered by other companies with which the Company competes to attract
and retain
talented executives.
Base
Salary
The
Compensation Committee conducts an annual review of the base salary for
each
senior executive officers. Each year after the completion of the Company’s
fiscal year end, the Compensation Committee meets with the Chief Executive
Officer to consider the individual and corporate performance factors
outlined
above, the success of the Company in meeting its business and financial
objectives, and the overall contribution of each executive officer in
helping to
attain those objectives. The Compensation Committee also considers each
executive officer’s qualifications, duties and
responsibilities.
Cash
Bonuses
The
Company’s executives are eligible to receive cash incentive bonuses on an annual
basis. This element of compensation is designed to motivate the Company’s
employees to meet the business and financial objectives of the Company
because
it is tied to the profitability of the Company. The formula for
calculating the annual cash bonus is determined at the beginning of each
fiscal
year. The Board retains the authority to award discretionary cash
bonuses to the executive officers.
Equity
Compensation
The
Compensation Committee makes recommendations to the Board for the awarding
of
equity-based, long-term incentive compensation. The Compensation
Committee believes that stock grants to executive officers provide incentives
for executive officers to build stockholder value and thereby align the
interests of the executive officers with the stockholders. The Compensation
Committee also believes that these grants, which vest over a period of
years,
provide incentives for executive officers to remain with the Company. In
determining the number of shares granted in any fiscal year, the Compensation
Committee considers such factors as the seniority of the executive officer,
the
contribution that the executive officer is expected to make to the Company
in
the coming years and has made to the Company in the past, and the size
of prior
grants to the executive officer.
Perquisites
The
Company annually reviews the perquisites that senior executives receive.
Executive officers are provided with the use of a vehicle, and in some
instances, reimbursement for club dues, and executive life
insurance.
Other
Benefits
The
Company maintains broad-based benefits that are provided to all employees,
including health and dental insurance, life and disability insurance,
and a
401(k) plan. Participants in the 401(k) plan are permitted to contribute
to the
plan through payroll deductions within statutory and plan limits. The
Company provides a matching contribution of up to 3% of each eligible
employee’s salary per year. Participants may select from a variety of
investment options. At this time, investment options do not include
the Company’s common stock.
Employment
Agreements; Potential Payments Upon Termination of Employment and
Change-in-Control
Employment
Contracts
Mr.
Alex Trevino, Jr. serves as
President and Chief Executive Officer of the Company under an employment
agreement effective March 1, 1998. In the absence of notice of
termination, the term of the agreement is automatically extended for
additional
two-year terms. Under the agreement, Mr. Trevino receives an annual
base salary, certain benefits, and an annual incentive bonus based on
a formula
recommended by the Board’s Compensation Committee and approved by the
Board.
Effective
March 1, 2004, Mr. Anthony R.
Maresca who serves as Senior Vice President and Chief Financial Officer
of the
Company, and Mr. A. Stephen Trevino, who serves as Senior Vice President
and
General Counsel of the Company, entered into employment agreements with
the
Company. Each agreement provides for an annual base salary, certain
benefits, and an annual incentive bonus based on a formula recommended
by the
Compensation Committee and approved by the Board. The agreements
provided for the grants of restricted shares of common stock of the Company
outlined above, and contain change of control provisions.
No
Other Agreements
There
are
no other employment agreements between the Company and other executive
officers
or employees of the Company and no other executive officers are entitled
to any
payments upon termination or a change of control that are not generally
available to all of the Company’s employees.
162(m)
Tax Deductibility
Section
162(m) of the Internal Revenue Code limits the deductibility of certain
otherwise deductible compensation in excess of $1.0 million paid to the
Named
Executive Officers. It is the policy of the Compensation Committee to
attempt to
have all executive compensation treated as tax-deductible compensation
wherever,
in the judgment of the Compensation Committee, to do so would be consistent
with
the objectives of the compensation plan under which the compensation
is paid.
However, this policy does not rule out the ability to make awards or
to approve
compensation that may not qualify for the compensation deduction. The
Compensation Committee may elect to approve awards or grant compensation
to
executive officers which are not deductible by the Company under Section
162(m)
of the Internal Revenue Code.
Compensation
Committee Interlocks and Insider Participation
None
of
the executive officers of the Company has served on the board or on the
compensation committee of any other entity, any of whose officers served
either
on the Board or on the Compensation Committee of the Company.
Report
of the Compensation Committee
The
Compensation Committee is committed to achieving the stated objectives
by
acknowledging and rewarding contributions made by the Company’s executive
officers to the overall performance of the Company. Compensation
arrangements for executive officers generally consist of a combination
of fixed
base salary, performance-based cash bonuses, and long-term incentives
utilizing
common stock of the Company.
The
Committee considers competitive compensation offered for similar
responsibilities by other organizations, including the compensation
offered by a
peer group of companies. The Committee compares the Company’s total
compensation, as well as each major component of compensation, with
the peer
group for overall competitiveness. Although the Committee reviews peer
group
information for guidance, it does not exclusively target executive
compensation
to specific compensation levels at other companies. The Committee uses
a variety
of resources, including publicly available data and published compensation
surveys, in order to establish compensation levels in a highly competitive
environment for executive leadership. Additionally, the committee may
utilize the services of outside compensation experts.
The
Committee met a total of four times in fiscal 2007 and continued its
practice of
reviewing total compensation for the Company’s executive officers. Total
compensation includes base salary, annual cash bonus, long-term incentive
compensation, perquisites and other benefits.
Summary
Compensation Table
The
following table sets forth the compensation earned by the named executive
officers during fiscal 2007. Earned bonuses are generally paid in the
fiscal year following the year in which the bonus is
earned.
Name
and Principal Position
|
|
Year
|
|
Salary ($)
|
|
Bonus ($)
|
|
Restricted Stock
Awards ($)
|
|
All
Other
Compensation ($)
|
|
Total ($)
|
|
Alex
Trevino, Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chairman
of the Board, President
|
|
2007
|
|
|
400,000
|
|
|
214,224
|
|
|
|
|
|
22,673
|
|
|
636,897
|
|
and
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACR
Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior
Vice President, Treasurer
|
|
2007
|
|
|
250,000
|
|
|
214,224
|
|
|
|
|
|
14,014
|
|
|
478,238
|
|
and
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACR
Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior
Vice President, Secretary
|
|
2007
|
|
|
250,000
|
|
|
214,224
|
|
|
|
|
|
12,455
|
|
|
476,679
|
|
and
General Counsel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACR
Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
F. Knoop
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
President,
Florida Cooling Supply,
|
|
2007
|
|
|
150,000
|
|
|
180,294
|
|
|
117,000
|
|
|
6,283
|
|
|
453,577
|
|
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
President,
Total Supply, Inc.
|
|
2007
|
|
|
125,000
|
|
|
79,698
|
|
|
117,000
|
|
|
6,733
|
|
|
328,431
|
|
(1) Messrs.
Maresca and S. Trevino each were awarded 500,000 restricted shares of
common
stock of the Company which vest ratably over a six year period contingent
upon
future service to the Company, with the first vesting date occurring
on March 1,
2005. At February 28, 2007, the unvested restricted shares for each
officer had a cumulative value of $1,536,670. Unvested restricted
shares have voting rights but are not entitled to dividends.
(2) Other
annual compensation includes Company contributions to the Company’s 401(k) Plan,
the value of insurance premiums paid by the Company during the fiscal
year with
respect to term life insurance for the benefit of the named executive
officer,
and other perquisites.
FISCAL
YEAR 2007 ALL OTHER COMPENSATION
TABLE1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Year
|
|
Perquisites
and Other Personal Benefits ($)
|
|
|
Insurance
Premiums ($)
|
|
|
Company
Contributions to Retirement and 401(k) Plans
($)
|
|
|
Change
in Control Payments / Accruals ($)
|
|
|
Total ($)
|
|
Alex
Trevino, Jr.
|
|
2007
|
|
|
5,043
|
|
|
|
11,030
|
|
|
|
6,600
|
|
|
|
|
|
|
|
22,673
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca
|
|
2007
|
|
|
7,414
|
|
|
|
|
|
|
|
6,600
|
|
|
|
|
|
|
|
14,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino
|
|
2007
|
|
|
8,705
|
|
|
|
|
|
|
|
3,750
|
|
|
|
|
|
|
|
12,455
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
F. Knoop
|
|
2007
|
|
|
|
|
|
|
|
|
|
|
6,283
|
|
|
|
|
|
|
|
6,283
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd
|
|
2007
|
|
|
2,083
|
|
|
|
|
|
|
|
4,650
|
|
|
|
|
|
|
|
6,733
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
The Company did not pay for any tax reimbursements or accrue
or pay for
any severance payments in fiscal 2007.
|
|
FISCAL
YEAR 2007 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN
CONTROL
TABLE3
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Benefit
|
|
Before Change in
Control Termination w/o Cause or for Good Reason
($)
|
|
After Change in
Control Termination w/o Cause or for Good Reason
($)
|
|
Change in
Control ($)
|
|
Alex
Trevino, Jr.1
|
|
|
Termination
|
|
|
800,000
|
|
|
800,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca2
|
|
|
Termination
/ Change in Control
|
|
|
754,000
|
|
|
754,000
|
|
|
754,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino2
|
|
|
Termination
/ Change in Control
|
|
|
754,000
|
|
|
754,000
|
|
|
754,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
F. Knoop
|
|
|
None
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd
|
|
|
None
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Upon termination the Company is obligated to pay 2.0 times
the current
base salary.
|
|
(2)
Upon a change in conrol the Company is obligated to pay 2.9
times the sum
of the base salary plus medical insurance for the prior twelve
months.
Additionally, the named officers would receive the amount
of bonus earned,
if any, through the termination or change in control date
for the current
fiscal year.
|
|
(3) There
are
no payments due for Voluntary Termination, Death, or Disability.
Option
Grants in Last Fiscal Year
There
were no stock options granted by
the Company to the Company’s executive officers during the fiscal year ended
February 28, 2007.
Aggregated
Option Values
There
are no unexpired stock options
owned by any of the executive officers at February 28, 2007.
GRANTS
OF PLAN-BASED AWARDS
The
following table sets forth certain information concerning grants of awards
made
to each Named Executive Officer during Fiscal 2007:
Name
|
Grant
Date
|
Approval
Date
|
|
(#)
of Restricted Shares
|
|
|
Exercise or
Base
Price of
Restricted Stock Awards
($ / Sh)
|
|
|
Grant
Date
Fair Value of Restricted Stock Award
($)
(2)
|
|
Alex
Trevino, Jr.
|
–
|
–
|
|
–
|
|
|
–
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca
|
|
–
|
|
–
|
|
|
–
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino
|
–
|
–
|
|
–
|
|
|
–
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Micahel
F. Knoop 1
|
4/15/2006
|
4/13/2006
|
|
30,000
|
|
|
|
3.90
|
|
|
|
117,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd 1
|
4/15/2006
|
4/13/2006
|
|
30,000
|
|
|
|
3.90
|
|
|
|
117,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Consists
of restricted stock that vest ratably over a 5-year period,
beginning on
the first anniversary of the date of grant. Vesting is contingent on
continued employment.
|
|
(2) Amounts
reflect the dollar amount recognized by the Company for financial
statement reporting purposes in accordance with Statement
of Financial
Accounting Standards No. 123(R), or SFAS 123(R), for all
outstanding
awards received by each Named Executive Officer during fiscal
2007.
|
|
FISCAL
YEAR 2007 OUTSTANDING EQUITY AWARDS AT FISCAL
YEAR-END
|
|
|
|
|
|
|
|
|
|
|
Stock
Awards
|
|
Name
|
|
Number of
Shares or Units of Stock That Have Not Vested
(#)
|
|
|
Market
Value of Shares or Units of Stock That Have Not Vested
($)
|
|
Alex
Trevino, Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca
|
|
|
333,334
|
|
|
|
1,536,670
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino
|
|
|
333,334
|
|
|
|
1,536,670
|
|
|
|
|
|
|
|
|
|
|
Michael
F. Knoop 1
|
|
|
30,000
|
|
|
|
138,300
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd 1
|
|
|
30,000
|
|
|
|
138,300
|
|
(1)
All
of the awards to Messrs. Knoop and Floyd represents restricted shares
of the
Company's common stock that were granted in fiscal 2007. Such shares
vest in
equal annual increments over five years, contingent on continued
employment.
FISCAL
YEAR 2007 STOCK VESTED TABLE
|
|
|
|
|
|
|
|
|
|
|
Stock
Awards
|
|
Name
|
|
Number of Shares
Acquired on Vesting (#)
|
|
|
Value Realized
on Vesting ($)
|
|
Alex
Trevino, Jr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
R. Maresca
|
|
|
83,333
|
|
|
|
296,665
|
|
|
|
|
|
|
|
|
|
|
A.
Stephen Trevino
|
|
|
83,333
|
|
|
|
296,665
|
|
|
|
|
|
|
|
|
|
|
Michael
F. Knoop
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronnie
G. Floyd
|
|
|
|
|
|
|
|
|
Directors’
Remuneration and Stock Grants
For
fiscal 2007, independent directors
were paid $24,000 per year, payable monthly, for service on the
Board. In addition, they are reimbursed for actual expenses incurred
for attendance at meetings. Effective March 1, 2004, Messrs.
Feinsilver and St. Cyr, the Company’s independent directors at that time,
entered into agreements with the Company each providing for awards of
42,000
restricted shares of common stock of the Company which vest ratably over
a four
year period upon future service to the Board. Unvested restricted
shares have voting rights but are not entitled to dividends. In
August, 2005, Mr. Reno entered into a similar agreement with the Company
for
25,000 restricted shares of common stock of the Company. Directors
who are employed by the Company receive no compensation for serving on
the
Board.
Directors’
Remuneration for Fiscal 2007
The
following table sets forth certain information concerning the compensation
of
the Company’s directors for Fiscal 2007:
Name
|
|
Fees Earned or
Paid in Cash ($)
|
|
|
Total
($)
|
|
Alan
D. Feinsilver
|
|
|
24,000
|
|
|
|
24,000
|
|
|
|
|
|
|
|
|
|
|
Roland
H. St. Cyr
|
|
|
24,000
|
|
|
|
24,000
|
|
|
|
|
|
|
|
|
|
|
Thomas
J. Reno
|
|
|
24,000
|
|
|
|
24,000
|
|
|
|
|
|
|
|
|
|
|
Marshall
G. Webb
|
|
|
24,000
|
|
|
|
24,000
|
|
|
|
|
|
|
|
|
|
|
Jo.
E. Shaw
|
|
|
24,000
|
|
|
|
24,000
|
|
Item
12. Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
The
following table sets forth certain
information concerning beneficial ownership of the Company's Common Stock
as of
April 30, 2007, by (i) each shareholder who is known by the Company to
own
beneficially more than 5% of the outstanding shares of common stock of
the
Company, (ii) each director and nominee for director, (iii) the President
and
Chief Executive Officer, and other executive officers of the Company,
and (iv)
all directors and executive officers as a group. Except as otherwise
indicated, the shareholders listed in the table have sole voting and
investment
power with respect to the shares indicated. All information with respect
to
beneficial ownership has been furnished by the shareholders to the
Company.
Name
and Address of Beneficial Owner
|
|
Amount
Of BeneficialOwnership (1)
|
|
Percent
of Class
|
DST
Investments
1100
Uptown Park Blvd., No. 72
Houston,
Texas 77056
|
|
1,268,394
|
|
10.5%
|
|
|
|
|
|
Alan
D. Feinsilver (2)
4400
Post Oak Parkway, Suite 2250
Houston,
Texas 77027
|
|
196,684
|
|
1.6%
|
|
|
|
|
|
Anthony
R. Maresca (3)
3200
Wilcrest Drive, Suite 440
Houston,
Texas 77042
|
|
768,566
|
|
6.4%
|
|
|
|
|
|
Thomas
J. Reno (4)
2010
Roanwood
Houston,
Texas 77090
|
|
25,000
|
|
0.2%
|
|
|
|
|
|
Jo
E. Shaw, Jr.
9
High Ridge Road
Santa
Fe, New Mexico 87506
|
|
-
|
|
0.0%
|
|
|
|
|
|
Roland
H. St. Cyr (5)
3151
Lake Island Dr.
Montgomery,
Texas 77356
|
|
51,000
|
|
0.4%
|
|
|
|
|
|
A.
Stephen Trevino (6)
3200
Wilcrest Drive, Suite 440
Houston,
Texas 77042
|
|
1,749,800
|
|
14.5%
|
|
|
|
|
|
Alex
Trevino, Jr. (7)
3200
Wilcrest Drive, Suite 440
Houston,
Texas 77042
|
|
1,874,847
|
|
15.5%
|
|
|
|
|
|
Marshall
G. Webb
6110
Inwood Drive
Houston,
Texas 77057
|
|
-
|
|
0.0%
|
|
|
|
|
|
All
Directors and Executive Officers
as
a group (8 persons) (8)
|
|
3,397,503
|
|
28.2%
|
(1)
|
For
each beneficial owner, the number of shares outstanding and
their
percentage of stock ownership includes the number of common
and all common
equivalent shares (including options exercisable within 60
days) owned by
such individual at May 31, 2007.
|
(2)
|
Includes
104,684 shares owned by a family limited partnership in which
Mr.
Feinsilver is the general partner, 25,000 shares owned by a
trust of which Mr. Feinsilver is the trustee, and 10,500 restricted
shares
which are subject to vesting requirements set forth in an agreement
with
the Company dated March 1,
2004.
|
(3)
|
Includes
250,001 restricted shares which are subject to vesting requirements
set
forth in an employment agreement with the Company dated March
1,
2004.
|
(4)
|
Includes
18,750 restricted shares which are subject to vesting requirements
set
forth in an agreement with the Company dated October 26,
2005.
|
(5)
|
Includes
10,500 restricted shares which are subject to vesting requirements
set
forth in an agreement with the Company dated March 1,
2004.
|
(6)
|
Includes
1,268,394 shares owned by DST Investments, a partnership in
which Mr. A.S.
Trevino, his mother and his sister are partners, and 11,259
shares owned
by the wife and children of Mr. A.S. Trevino. The beneficial
ownership of all of such shares is disclaimed by Mr. A.S.
Trevino. Includes 250,001 restricted shares which are subject
to vesting requirements set forth in an employment agreement
with the
Company dated March 1, 2004.
|
(7)
|
Includes
1,268,394 shares owned by DST Investments, a partnership whose
partners
are Henrietta Trevino, wife of Mr. A. Trevino, and his two
adult children,
and 2,000 shares owned by Henrietta Trevino. The beneficial
ownership of all of such shares is disclaimed by Mr. A.
Trevino.
|
(8)
|
Includes
all shares as to which directors and executive officers disclaim
beneficial ownership.
|
Item
13.
|
Certain
Relationships and Related
Transactions
|
No
Transactions
During
fiscal 2007, there were no
transactions with related parties.
Board
Member Independence
The
Board
of Directors has determined that Messrs. Feinsilver, Reno, Shaw, St.
Cyr and
Webb, the non-employee members of the Board, are “independent” as defined by
AMEX.
Item
14.
|
Principal
Accountant Fees and
Services
|
The
table
below summarizes the fees and expenses billed by our independent public
accountants for the fiscal years ended February 28, 2007 and 2006.
BDO
Seidman, LLP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal
Year
|
|
Audit
|
|
|
Audit
Related
|
|
|
Tax
|
|
|
All
Other
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2007
|
|
$ |
163,140
|
|
|
$ |
5,975
|
|
|
$ |
2,620
|
|
|
|
5,425
|
|
|
$ |
177,160
|
|
2006
|
|
$ |
157,013
|
|
|
$ |
3,300
|
|
|
|
-
|
|
|
|
-
|
|
|
$ |
160,313
|
|
Audit
fees are fees for the audit of our fiscal 2007 and
fiscal 2006 consolidated financial statements included in our Annual
Reports on
Form 10-K and reviews of consolidated financial statements included in
our
Quarterly Reports on Form 10-Q.
Audit-related
fees are fees that principally relate to assurance
and related services that are reasonably related to the performance of
the
audits and reviews of our consolidated financial statements and special
procedures required to meet certain regulatory requirements.
Tax
fees are fees for tax compliance, planning and
advisory services other than those that relate specifically to the audits
and
reviews of our consolidated financial statements.
All
other fees are fees that relate to consulting
services.
The
Audit
Committee has determined that the non-audit services rendered by BDO
are
compatible with maintaining the firm's independence.
Policy
on Pre-Approval of Audit and Non-Audit Services
The
Audit
Committee has the sole authority to approve the scope of the audit as
well as
all audit fees and terms. The Audit Committee must pre-approve any audit
and
non-audit services provided by our independent registered public accounting
firm. The Audit Committee will not approve the engagement of the independent
registered public accounting firm to perform any services that the independent
registered public accounting firm would be prohibited from providing
under
applicable securities laws or American Stock Exchange requirements. In
assessing
whether to approve the use of our independent registered public accounting
firm
to provide permitted non-audit services, the Audit Committee tries to
minimize
relationships that could appear to impair the objectivity of our independent
registered public accounting firm. The Audit Committee will approve permitted
non-audit services by BDO only when it will be more effective or economical
to
have such services performed by BDO than another firm. No fees were paid
for
non-audit related professional services for which the pre-approval process
by
the Audit Committee was waived.