SCHEDULE 14A
Information Required in Proxy Statement
SCHEDULE 14A INFORMATION
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 Addition Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
AAON, Inc.
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(Name of Registrant as specified in Its Charter)
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(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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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
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paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
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Page
AAON, INC.
Notice of
Annual Meeting
June 4, 2002
and
Proxy Statement
Page
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 4, 2002
Notice is hereby given that the Annual Meeting of Stockholders of AAON,
Inc. (the "Company"), will be held at 2440 South Yukon, Tulsa, Oklahoma, on
Tuesday, June 4, 2002, at 10:00 A.M. (Local Time), for the following purposes:
1. To elect two Class II Directors for terms ending in 2005; and
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
We hope that you will be able to attend this meeting, but if you do not
plan to do so, please date, sign and return the enclosed Proxy as promptly as
possible.
By Order of the Board of Directors
/s/ John B. Johnson, Jr.
John B. Johnson, Jr.
Secretary
April 19, 2002
Page
AAON, INC.
2425 South Yukon
Tulsa, Oklahoma 74107
PROXY STATEMENT
This statement is furnished in connection with the solicitation by the
Board of Directors of AAON, Inc., for proxies to be used at the Annual Meeting
of Stockholders of the Company to be held on June 4, 2002, at the time and place
set forth in the Notice of Annual Meeting accompanying this Proxy Statement.
Pursuant to provisions of the Bylaws of the Company and action of its
Board of Directors, the close of business on April 8, 2002, has been established
as the time and record date for determining the stockholders entitled to notice
of and to vote at this annual meeting. The stock transfer books will not be
closed.
Directors are elected by a plurality vote and the two nominees who
receive the most votes will be elected.
Stockholders of record on the record date are entitled to cast their
votes in person or by properly executed proxy at the Annual Meeting. The
presence, in person or by properly executed proxies, of thirty-three and
one-third percent (33-1/3%) of the Common Stock outstanding on the record date
is necessary to constitute a quorum at the Annual Meeting. If a quorum is not
present at the time the Annual Meeting is convened, the Company may adjourn or
postpone the meeting.
The enclosed Proxy may be revoked at any time prior to the voting
thereof, either by giving notice to the Secretary of the Company or by personal
attendance at the meeting. All Proxies received in advance of the meeting may be
revoked prior to exercise.
This Proxy Statement, the Notice of Annual Meeting and accompanying
proxy card, as well as the Company's 2001 Annual Report (which includes the
Company's Annual Report on Form 10-K for the year ended December 31, 2001), will
be first mailed to stockholders approximately April 26, 2002.
-1-
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of April 8, 2002 (the record date), the Company had issued a total
of 8,796,743 shares of $.004 par value Common Stock, its only class of stock
outstanding. Each share is entitled to one vote on all matters submitted to a
vote by stockholders.
The following table sets forth as of April 8, 2002, the aggregate
number of shares of Common Stock of the Company owned by each person known by
the Company to be the beneficial owner of more than 5% of the Company's Common
Stock:
Percent
Name and address Number of shares of
of beneficial owner owned class
------------------- ---------------- -----------
Norman H. Asbjornson 1,682,011 (1) 18.8
2425 South Yukon
Tulsa, Oklahoma 74107
FMR Corp. 747,000 (2) 8.5
82 Devonshire Street
Boston, Massachusetts 02109
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(1) Includes 158,250 shares held under presently exercisable stock options.
Mr. Asbjornson has sole voting and investment powers with respect to
all shares beneficially owned by him, except for 7,375 shares held by
his IRA account and 4,608 shares under the Company's 401(k) plan.
(2) This share ownership information was provided by a representative of
FMR Corp. A Schedule 13G dated February 14, 2002, discloses that FMR
Corp. possesses the sole power to dispose or direct the disposition of
the reported shares.
The following table sets forth as of April 8, 2002, the aggregate
number of shares of Common Stock of the Company owned of record or beneficially
by each director of the Company and by each executive officer whose 2001 salary
and bonus exceeded $100,000, and by all directors and such officers as a group:
-2-
Percent
Name and address of each Executive Number of Shares of
Officer and Names of Other Directors Owned (1) Class
------------------------------------ ---------------- -------------
Norman H. Asbjornson (2) 1,682,011 (4) 18.8
2425 South Yukon
Tulsa, Oklahoma 74107
Robert G. Fergus (3) 109,842 (5) 1.2
2425 South Yukon
Tulsa, Oklahoma 74107
William A. Bowen 203,773 (6) 2.3
John B. Johnson, Jr. 75,000 (7)(8) 1.0
Thomas E. Naugle 105,285 (7) 1.2
Anthony Pantaleoni 114,484 (7) 1.3
Jerry E. Ryan - 0 - 0.0
Charles C. Stephenson, Jr. 350,832 (7) 4.0
Directors and named executive officers
as a group (eight persons) 2,641,227 (9) 28.8
(1) All shares are held beneficially and of record and the owner has sole
voting and investment power with respect thereto, except as otherwise
noted.
(2) Mr. Asbjornson is a director and executive officer.
(3) Mr. Fergus is an executive officer of the Company.
(4) Includes 158,250 shares issuable upon the exercise of stock options that
are exercisable within 60 days. Mr. Asbjornson has sole voting and
investment powers with respect to all shares beneficially owned by him,
except for 7,375 shares held by his IRA account and 4,608 shares under the
Company's 401(k) plan.
(5) Includes 3,000 shares issuable upon the exercise of a stock option and
3,697 shares under the Company's 401(k) plan.
(6) Includes 41,250 shares issuable upon exercise of stock options exercisable
within 60 days, 10,787 shares held by Mr. Bowen's IRA account and 2,050
shares under the Company's 401(k) plan.
(7) Includes 41,250 shares issuable upon the exercise of stock options that are
exercisable within 60 days.
(8) Includes 33,750 shares held for the account of Mr. Johnson under a
broker-administered retirement plan.
(9) Includes 359,250 shares issuable upon the exercise of stock options that
are exercisable within 60 days by all Executive Officers and directors.
-3-
ELECTION OF DIRECTORS
General
The Board of Directors of the Company currently has seven members. The
Company's Bylaws (the "Bylaws") divide the Board of Directors into three classes
having staggered terms of three years each, with Classes II, III and I having
terms expiring at the Annual Meeting of Stockholders in 2002, 2003 and 2004,
respectively. The Company's Bylaws provide that a stockholder may nominate a
director for election at an annual meeting if written notice is given to the
Company not less than 60 and not more than 90 days in advance of the anniversary
date of the immediately preceding annual meeting.
It is intended that the names of the nominees listed below will be
placed in nomination and that the persons named in the proxy will vote for their
election. Each nominee has consented to being named in this Proxy Statement and
to serve if elected. If either nominee becomes unavailable for any reason, the
shares represented by the proxies will be voted for such other person, if any,
as may be designated by the Board of Directors. However, management has no
reason to believe that either nominee will be unavailable.
Nominees:
Class II - For Term to Expire in 2005
-------------------------------------
Name Age Current Position
---- --- ----------------
William A. Bowen ................... 72 Director
Anthony Pantaleoni ................. 62 Director
Directors Continuing in Office:
Class III - Term Expires in 2003
Name Age Current Position
---- --- ----------------
Norman H. Asbjornson................ 66 President and Director
John B. Johnson, Jr. ............... 68 Secretary and Director
Charles C. Stephenson, Jr. ......... 65 Director
Class I - Term Expires in 2004
Name Age Current Position
---- --- ----------------
Thomas E. Naugle.................... 63 Director
Jerry E. Ryan ...................... 59 Director
Biographical Information
Set forth below is a description of the background of each director and
executive officer of the Company. The term of office of each officer ends on the
date of the Annual Meeting, subject to extension upon reelection.
-4-
Norman H. Asbjornson has served as President and a director of the
Company since 1989 and currently serves in the class of directors whose terms
expire at the 2003 annual meeting of stockholders. Mr. Asbjornson also serves as
the President of AAON, Inc., an Oklahoma corporation and wholly-owned subsidiary
of the Company ("AAON-Oklahoma"), and AAON Coil Products, Inc., a wholly-owned
subsidiary of the Company ("ACP").
William A. Bowen served as Vice President-Finance of the Company from
1989 until July, 1999. He has served as a director of the Company since 1989 and
currently serves in the class of directors whose terms expire at the 2002 annual
meeting of stockholders. From 1987 to 1998, Mr. Bowen was engaged in financial
consulting in Tulsa, Oklahoma.
Robert G. Fergus, age 61, has served as Vice President of the Company
since 1989. Mr. Fergus also serves as Vice President of AAON-Oklahoma.
John B. Johnson, Jr., has served as Secretary and a director of the
Company since 1989 and currently serves in the class of directors who terms
expire at the 2003 annual meeting of stockholders. Mr. Johnson also serves as
the Secretary of AAON-Oklahoma and ACP. Mr. Johnson has been engaged in the
private practice of law in Tulsa, Oklahoma, since 1961, and is a member of the
firm of Johnson, Jones, Dornblaser, Coffman & Shorb, which serves as General
Counsel to the Company.
Thomas E. Naugle has served as a director of the Company since 1998 and
currently serves in the class of directors whose terms expire at the 2004 annual
meeting of stockholders. From 1985 to present, Mr. Naugle has served as Chairman
of the Board of Directors and/or President of Naugle & Co., a company engaged in
the business of investments. From 1984 until May, 1999, he served as Chairman of
the Board of Directors of Barrett Trailers, Inc., a manufacturer of trailers.
From 1986 to 1996, Mr. Naugle was Chairman of the Board of Directors of Tulsa
Winch, Inc., a manufacturer of winches. From 1992 to 1996, he served as
President of Hanner, Inc., an equipment leasing company.
Anthony Pantaleoni has served as a director of the Company since 1989
and currently serves in the class of directors whose terms expire at the 2002
annual meeting of stockholders. Since 1970, Mr. Pantaleoni has been a partner of
Fulbright & Jaworski L.L.P. or a predecessor firm in New York, New York. He also
serves as a member of the Board of Directors of Universal Health Services, Inc.,
a publicly held hospital chain, and Westwood Corporation, a publicly held
defense contractor.
Jerry E. Ryan was elected as a director by the Board on September 24,
2001. His term will expire at the 2004 annual meeting of stockholders. From 1985
until January 2000, Mr. Ryan served as Chairman of the Board and CEO of Fintube
Limited Partnership, a company based in Tulsa, Oklahoma, the business of which
was manufacturing fintubes and pressure parts for electric power generation
boilers. The company was sold to Lone Star Technologies of Dallas, Texas, in
January 2000. Lone Star is a leading producer of oil country tubular goods and
cold drawn specialty tubing. Mr. Ryan serves on the Board of Directors of Lone
Star, a public company, and on the Board of Global Energy Equipment Group,
Tulsa, Oklahoma, a publicly held global designer, engineer and fabricator of
equipment for gas turbine power plants.
Kathy I. Sheffield, age 49, became Treasurer of the Company in July,
1999. Ms. Sheffield was the Accounting Supervisor of the Company from 1989 to
1992, when she became Accounting Manager.
-5-
Charles C. Stephenson, Jr., has served as a director of the Company
since 1996 and currently serves in the class of directors who terms expire at
the 2003 annual meeting of stockholders. Since 1987, Mr. Stephenson has served
as Chairman of the Board of Directors of Vintage Petroleum, Inc., a publicly
held company engaged in oil and gas production and exploration.
-6-
MEETINGS OF DIRECTORS AND AUDIT COMMITTEE
The business of the Company is managed under the direction of its Board
of Directors. The Board of Directors met four times during 2001, and each
director participated in at least 75% of all Board and applicable committee
meetings held last year, except for Mr. Ryan, who only attended the November
2001 Board meeting following his election to the Board in September of last
year. Actions taken by the Board of Directors outside of Board meetings were
consented to in writing by a memorandum of action in lieu of a meeting, to which
all incumbent directors subscribed. Directors meet their responsibilities not
only by attending Board and committee meetings but also through communication
with members of management on matters affecting the Company.
The Board of Directors has established an audit committee to devote
attention to specific subjects and to assist it in the discharge of its
responsibilities. The functions of the audit committee, its members and the
number of meetings held during 2001 are described below. The Board does not have
a standing nominating or compensation committee; however, the Board does have a
committee that administers the Company's Stock Option Plan.
The Audit Committee provides the opportunity for direct communications
between the Company's independent public accountants and the Board of Directors.
The Audit Committee meets with the accountants to review their effectiveness
during the annual audit and to discuss the Company's internal control policies
and procedures. The Audit Committee and the independent public accountants met
four times during fiscal year 2001. The members of the Audit Committee are
currently Messrs. Naugle, Pantaleoni and Ryan.
A copy of the charter of the Audit Committee, as amended on February
12, 2002, is attached as Appendix A. Each member of the Audit Committee is
"independent", as defined in Rule 4200(a)(15) of the National Association of
Securities Dealers listing standards.
Audit Committee Report
February 12, 2002
To the Board of Directors of AAON, Inc.:
We have reviewed and discussed with management the Company's audited
financial statements as of and for the year ended December 31, 2001.
We have discussed with the independent auditors the matters required to
be discussed by Statement on Auditing Standards No. 61, Communication with Audit
Committees, as amended, by the Auditing Standards Board of the American
Institute of Certified Public Accountants.
We have received and reviewed the written disclosures and the letter
from the independent auditors required by Independence Standard No. 1,
Independence Discussions with Audit Committees, as amended, by the Independence
Standards Board, and have discussed with the auditors the auditors'
independence.
Based on the reviews and discussions referred to above, we recommend to
the Board of Directors that the financial statements referred to above be
included in the Company's Annual Report on Form 10-K for the year ended December
31, 2001.
Thomas E. Naugle, Chairman
Anthony Pantaleoni
Jerry E. Ryan
-7-
EXECUTIVE COMPENSATION
Compensation. The following table sets forth information as to the
compensation of the executive officers of the Company whose annual salary and
bonus exceeded $100,000.
Summary Compensation Table
Long-Term
Annual Compensation Compensation
------------------------ -------------------------------------- ------------ ------------
Other Securities
Name and Annual Underlying All Other
Principal Position Year Salary Bonus Compensation Options/SARs Compensation
------------------------ ----- --------- --------- ------------ ------------ ------------
Norman H. Asbjornson 2001 $ 150,000 $ 50,000 $ 3,613 (1) -0- $41,170 (3)
President
2000 $ 150,000 $ 50,000 $ 3,296 (1) -0- $36,301 (3)
1999 $ 132,000 -0- $ 2,373 (1) 5,000 (2) $31,873 (3)
Robert G. Fergus 2001 $ 116,412 $ 10,000 $ 3,613 (1) -0- $ 5,109 (4)
Vice President
2000 $ 111,330 $ 17,000 $ 3,296 (1) -0- $ 6,074 (5)
1999 $ 109,488 $ 15,000 $ 2,373 (1) 5,000 (2) $ 5,746 (4)
--------------
(1) A per capita share, the same as all other eligible employees, of 10% of
the pre-tax profit of AAON-Oklahoma.
(2) Granted under the Company's Stock Option Plan.
(3) Includes (i) contributions to the Company's 401(k) plan by the Company
in the amounts of $7,319, $6,799 and $6,422 for years 2001, 2000 and
1999, respectively, (ii) the estimated dollar value of the benefit to
the executive officer from premiums paid by the Company on a reverse
split dollar insurance policy on the life of the executive in the
amounts of $33,760, $29,414 and $25,451 for years 2001, 2000 and 1999,
respectively, and (iii) medical reimbursement benefits of $91 and $88
in 2001 and 2000, respectively.
(4) Contributions to the Company's 401(k) plan by the Company.
(5) Includes (1) contributions to the Company's 401(k) plan of $5,067 and
(ii) a medical reimbursement benefit of $1,007.
Stock Options: No stock options were granted by the Company during 2001
to either of its named executive officers, and no stock options were "repriced"
during the past year.
The following table provides information on the value of each of the
named executive officer's unexercised in-the-money options to acquire common
stock at December 31, 2001.
Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End Option/SAR Values
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Options/ Options/SARs at
SARs at FY-End (#) FY-End ($)
Shares Acquired On Exercisable/ Exercisable/
Name Exercise (#) Value Realized ($) Unexercisable Unexercisable (1)
---------------------- ------------------ ------------------ ---------------------- --------------------
Norman H. Asbjornson -0- -0- 135,000/63,750 $2,628,245/$1,207,553
Robert G. Fergus 6,500 $143,014 3,000/4,500 $47,400/$71,100
--------------
(1) Calculated based on the difference between the Nasdaq National Market
closing price of Common Stock on December 31, 2001 (the last trading
day of the year), of $24.47 and the exercise price of the option.
The Company has no Long-Term Incentive Plan ("LTIP") or "defined
benefit" (pension) plan.
The Company has no employment contracts with any of its officers,
directors or employees, nor any compensatory plan or arrangement concerning any
person's termination of employment or respecting any "change in control".
-8-
Compensation of Directors. Directors of the Company were paid a fee of
$1,500 for attendance at the February 2001 board meeting and $2,500 for
attending each of the other three meetings last year and they were reimbursed
for out-of-pocket expenses incurred for attendance at such meetings. In
addition, the Company has granted persons who are newly elected Directors of the
Company (only Mr. Ryan in 2001) an option to purchase 41,250 shares of the
Company's Common Stock, which options fully vest on the first anniversary of the
date of grant. Messrs. Asbjornson, Bowen, Johnson and Pantaleoni were also
granted 41,250 share options in 1997, five years after their original grants.
REPORT ON EXECUTIVE COMPENSATION
General. The entire Board of Directors is responsible for (i) oversight
and administration of executive compensation, (ii) review of the Company's
overall compensation program and (iii) administering the Company's Stock Option
Plan. However, Messrs. Asbjornson and Bowen abstain from voting on their
compensation. There have been no "interlocks" or "insider participation" [as
those terms are defined in Item 402(j) of S.E.C. Regulation S-K] in compensation
decisions.
Compensation Process and Philosophy. Historically, there have been two
major components to the Company's executive officer compensation: (i) base
salary and (ii) option grants. The process used by the Board of Directors in
determining executive compensation levels has been based upon the Board of
Directors' subjective judgment of qualitative and quantitative factors. No
specific weights have been previously assigned to the qualitative and
quantitative factors in determining the compensation levels. The Board of
Directors considers the recommendation of the Company's President with respect
to the compensation level of the Company's executive officers, including the
President. The Board of Directors ultimately determines the level of
compensation for each of the Company's executive officers. The Board of
Directors believes that compensation for the Company's employees, including the
executive officers, must be in amounts sufficient to attract, retain and
motivate key employees, while at the same time maintaining a close relationship
to the Company's financial performance. The Board of Directors believes
compensation decisions should be tied to individual performance and designed to
encourage and reward employees for creating stockholder value. In addition,
executive officers have a significant portion of their total compensation
opportunity at risk, i.e., stock options. The Company's compensation philosophy
is based on the following general principles: (i) employee compensation should
reflect the financial success of the overall Company and the individual's
performance and (ii) encourage all employees to invest in the Company's common
stock to align their interests with the stockholders' interests in maximizing
value. Because the Board believes that its executive officers currently have
adequate stock option incentives, their added compensation last year took the
form of bonuses.
Salaries and Bonuses. Mr. Asbjornson's annual salary in 2001 was
$150,000 and he was paid a bonus of $50,000 last year. The Company had a
$1,000,000 "reverse split dollar" life insurance arrangement with Mr. Asbjornson
through June 11, 2001 (when it was cancelled), pursuant to which the Company
paid the portion of the premium attributable to the term insurance cost
(determined by Internal Revenue Service "P.S. 58" rates), and was the
beneficiary of the full face amount of the policy, and Mr. Asbjornson paid the
amount of premium in excess of such insurance cost and was the owner-beneficiary
of the greater of the cash value thereof or the amount of all premiums paid by
him. Performance factors considered in setting Mr. Asbjornson's compensation
include having responsibility for establishing overall corporate philosophy and
goals, organizing and staffing Company personnel, overseeing implementation of
Board directives, financial budgets, marketing strategies, engineering projects
and manufacturing methods. His compensation is measured both by progress toward
long-term goals and current financial results.
-9-
Mr. Fergus' annual salary was increased from $111,330 in 2000 to
$116,412 in 2001 and he was paid a bonus of $10,000 last year. Mr. Fergus' 2001
compensation was predicated on his efforts in reducing direct labor by
implementation of improved manufacturing methods and his overall job
performance.
Mr. Bowen's annual rate of compensation has been $38,564 since December
1, 1997. Additionally, the Company made 401(k) plan contributions to Mr. Bowen's
account totaling $2,474 in 2001.
Messrs. Asbjornson, Fergus and Bowen also participate in the Company's
"profit sharing" plan ($3,613 each in 2001 contributed by the Company, a per
capita share, the same as all other eligible employees, of 10% of the pre-tax
profit of AAON-Oklahoma), and Messrs. Asbjornson and Bowen received directors'
fees in 2001.
Board of Directors: Norman H. Asbjornson, William A. Bowen,
John B. Johnson, Jr., Thomas E. Naugle,
Anthony Pantaleoni, Jerry E. Ryan and
Charles C. Stephenson, Jr.
BOARD OF DIRECTORS INTERLOCKS AND INSIDER
PARTICIPATION IN COMPENSATION DECISIONS
There were no reportable business relationships between the Company (or
any other corporation that requires specific disclosure under this heading) and
the members of the Board of Directors in 2001.
-10-
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return of
the Company, NASDAQ US and its peer group named below. The graph assumes a $100
investment at the closing price on January 1, 1996, and reinvestment of
dividends on the date of payment without commissions. This table is not intended
to forecast future performance of the Company's common stock.
1996 1997 1998 1999 2000 2001
AAON, INC. $100 $155.12 $191.02 $294.87 $362.82 $752.92
NASDAQ $100 $122.48 $172.72 $320.98 $193.13 $152.62
PEER GROUP $100 $ 90.09 $ 88.50 $ 85.57 $ 89.30 $118.39
*The peer group consists of American Standard Companies, Fedders Corp.,
Lennox International, Inc., Mestek, Inc., Nortek, Inc., and York International
Corp., all of which are in the business of manufacturing air conditioning and
heat exchange equipment.
-11-
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of Forms 4 furnished to the Company during
its most recent fiscal year, the Company knows of no director, officer or
beneficial owner of more than ten percent of the Company's Common Stock who
failed to file on a timely basis reports of beneficial ownership of the
Company's Common Stock as required by Section 16(a) of the Securities Exchange
Act of 1934, as amended.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Arthur Andersen LLP ("AA") as the
independent auditors of the Company for the fiscal year ending December 31,
2002. Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting with the opportunity to make a statement if they so desire and to
be available to respond to appropriate questions.
Fees and Independence
Audit Fees. AA billed the Company an aggregate of $76,000 for
professional services rendered for the audit of the Company's financial
statements for the year ended December 31, 2001, and its reviews of the
Company's financial statements included in its Forms 10-Q during year 2001.
Financial Information Systems Design and Implementation Fees. During
the year ended December 31, 2001, AA provided no services and, therefore, billed
no fees to the Company in connection with financial information systems design
and implementation.
All Other Fees. No other fees were billed by AA to the Company during
2001.
The Audit Committee of the Board of Directors has determined that the
provision of services by AA described above is compatible with maintaining AA's
independence as the Company's principal accountant.
STOCKHOLDER PROPOSALS FOR 2003 ANNUAL MEETING
Stockholder proposals intended to be presented at the 2003 Annual
Meeting and to be included in the Company's Proxy Statement must be received at
the Company's executive offices, 2425 South Yukon, Tulsa, Oklahoma 74107, no
later than December 27, 2002.
However, a stockholder who otherwise intends to present business at the
2003 Annual Meeting of stockholders, including nominations of persons to the
Company's Board of Directors, must also comply with the requirements set forth
in the Company's Bylaws. The Bylaws state, among other things, that to bring
business before an annual meeting or to nominate a person for the Company's
Board of Directors, a stockholder must give written notice that complies with
the Bylaws to the Secretary of the Company not less than 60 days nor more than
90 days in advance of the anniversary date of the immediately preceding Annual
Meeting. Thus, a notice of a stockholder proposal or nomination for the 2003
Annual Meeting of stockholders, submitted other than pursuant to Rule 14a-8,
will be untimely if given before March 7, 2003, or after April 4, 2003. As to
any such proposals, the proxies named in management's proxy for that meeting
will be entitled to exercise their discretionary authority on that proposal
unless the Company receives notice of the matter to be proposed between March 7,
2003, and April 4, 2003. Even if proper notice is received on a timely basis,
the proxies named in management's proxy for that meeting may nevertheless
exercise their discretionary authority with respect to such matter by advising
stockholders of such proposal and how they intend to exercise their discretion
to vote on such matter to the extent permitted under Rule 14a-4(c)(2) of the
Securities Exchange Act of 1934, as amended.
-12-
OTHER MATTERS
Management knows of no business which will be presented at the 2002
Annual Meeting other than to elect directors for the ensuing year.
The cost of preparing, assembling and mailing all proxy solicitation
materials will be paid by the Company. It is contemplated that the solicitation
will be conducted only by use of the mails. The Company will, upon request,
reimburse brokers for the costs incurred by them in forwarding solicitation
materials to such of their customers as are the beneficial holders of Common
Stock of the Company registered in the names of such brokers.
By Order of the Board of Directors
/s/ Norman H. Asbjornson
Norman H. Asbjornson
President
April 19, 2002
-13-
Appendix A
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
AAON, INC.
Charter
---------------------------------
(As amended on February 12, 2002)
The audit committee is a committee of the board of directors. Its primary
function is to assist the board in fulfilling its oversight responsibilities by
reviewing the financial information which will be provided to the shareholders
and others, the systems of internal controls which management and the board of
directors have established, including the compliance program, and the audit
process.
In meeting its responsibilities, the audit committee is expected to:
1. Provide an open avenue of communication between the independent
auditors and the board of directors.
2. Review and update the committee's charter annually.
3. Recommend to the board of directors the independent auditors to be
nominated, approve the compensation of the independent auditors and
review and approve the discharge of the independent auditors.
4. Confirm and assure the independence of the auditors, including approval
and review of management consulting services and related fees provided
by the auditors.
5. Inquire of management and the independent auditors about significant
risks or exposures and assess the steps management has taken to
minimize such risks to the company.
6. Consider, in consultation with the independent auditors, the audit
scope and plan of the auditors.
7. Consider with management and the independent auditors the rationale for
any engagement of audit firms other than the principal independent
auditors.
8. Review with the independent auditors the coordination of audit effort
to assure completeness of coverage, reduction of redundant efforts and
the effective use of audit resources.
9. Consider and review with the independent auditors:
a. The adequacy of the company's internal controls, including
computerized information system controls and security.
b. Any related significant findings and recommendations of the
independent auditors, together with management's responses
thereto.
10. Review with management and the independent auditors prior to filing
Form 10-K:
a. The company's annual financial statements and related
footnotes.
Page
b. The independent auditors' audit of the financial statements
and its report thereon.
c. Any significant changes required in the independent auditors'
audit plan.
d. Any serious difficulties or disputes with management
encountered during the course of the audit.
e. Other matters related to the conduct of the audit which are to
be communicated to the committee under generally accepted
auditing standards.
11. Review filings with the SEC and other published documents containing
the company's financial statements and consider whether the information
contained in these documents is consistent with the information
contained in the financial statements.
12. Review with management and the independent auditors each Form 10-Q
before it is filed with the SEC.
13. Review practices with respect to officers' expense accounts and
perquisites, including their use of corporate assets, and consider the
results of any review of these areas by the independent auditors.
14. Meet with the independent auditors and management in separate executive
sessions to discuss any matters that the committee believes should be
discussed privately with the audit committee.
15. Report committee actions to the board of directors with such
recommendations as the committee may deem appropriate.
16. The audit committee shall have the power to conduct or authorize
investigations into any matters within the committee's scope of
responsibilities. The committee shall be empowered to retain
independent counsel, accountants or others to assist in the conduct of
any investigation.
17. The committee shall meet at least four times per year or more
frequently as circumstance require. The committee may ask members of
management or others to attend the meetings and provide pertinent
information as necessary.
18. The committee will perform such other functions as assigned by law, the
company's charter or bylaws or the board of directors.
19. Prepare a letter for inclusion in the annual report that describes the
committee's composition and responsibilities and how they were
discharged.
Page
AAON, Inc. PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
2425 South Yukon
Tulsa, Oklahoma 74107 The undersigned stockholder of AAON, Inc., a Nevada corporation, hereby constitutes
and appoints John B. Johnson, Jr., and Thomas E. Naugle, and each of them, with
full power of substitution, as attorneys and proxies to appear and vote all shares
of stock of the Company standing in the name of the undersigned, at the Annual
Meeting of Stockholders of the Company to be held at 2440 South Yukon Avenue,
Tulsa, Oklahoma, on Tuesday, June 4, 2002, at 10:00 a.m. (Local Time), and at any
adjournment thereof, with all powers that the undersigned would possess if
personally present, hereby revoking all previous proxies.
1. Election of Directors: FOR both nominees listed below WITHHOLD AUTHORITY
(except as shown to the contrary below) |_| to vote for both nominees listed below |_|
William A. Bowen and Anthony Pantaleoni for terms ending in 2005.
(INSTRUCTION: To withhold authority to vote for either nominee, write that nominee's name on the space provided below.)
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2. In their discretion, upon any other matters as may properly come before the meeting.
(over)
This proxy when properly executed will be voted in the manner directed herein by the undersigned stockholder. If no direction
is made, this proxy will be voted FOR both of management's nominees for director.
The undersigned hereby acknowledge(s) receipt of the Notice of the aforesaid Annual Meeting and the Proxy Statement
accompanying the same, both dated April 19, 2002.
Dated: , 2002
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(Please sign exactly as your name appears at left. When shares
are held in the names of two or more persons, all should sign
individually. Executors, administrators, trustees, etc., should
so indicate when signing. When shares are held in the name of
a corporation, the name of the corporation should be written
first and then an authorized officer should sign on behalf of
the corporation, showing the office held.)
PLEASE COMPLETE, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY,
USING THE ENCLOSED ENVELOPE.
(over)