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Virco Mfg. Corporation
2027 Harpers Way
Torrance, California 90501
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS, June 20, 200616, 2009
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on June 16, 2009
The Proxy Statement and accompanying Annual Report to Stockholders are available at www.virco.com.
GENERAL INFORMATION
This Proxy Statement is being mailed to stockholders of Virco Mfg. Corporation, a Delaware corporation (the “Company”), on or about May 23, 2006,18, 2009, in connection with the solicitation by the Board of Directors of proxies to be used at the 2009 Annual Meeting of Stockholders (the “Annual Meeting”) of the Company to be held on Tuesday, June 20, 200616, 2009, at 10:00 a.m. Pacific Time at the Company’s principal executive offices located at 2027 Harpers Way, Torrance, California,CA 90501, and any and all adjournments and postponements thereof.
The cost of preparing, assembling and mailing the Notice of the Annual Meeting, of Stockholders, Proxy Statement and form of proxy and the solicitation of proxies will be paid by the Company. Proxies may be solicited in person or by telephone, telegraph,e-mail or other electronic means by personnel of the Company who will not receive any additional compensation for such solicitation. The Company will pay brokers or other persons holding stock in their names or the names of their nominees for the expenses of forwarding soliciting material to their principals.
RECORD DATE AND VOTING
The close of business on April 21, 2006,24, 2009, has been fixed as the record date for the determination of stockholders entitled to notice of and to vote at the meeting.Annual Meeting. On that date there were 13,137,28814,172,422 shares of the Company’s Common Stock,common stock, par value $.01 per share (“Common Stock”), outstanding. All voting rights are vested exclusively in the holders of the Company’s Common Stock. Each share of Common Stock is entitled to one vote on any matter that may be presented for consideration and action by the stockholders, except that as to the election of directors, stockholders may cumulate their votes. Because three directors are to be elected, cumulative voting means that each stockholder may cast a number of votes equal to three times the number of shares actually owned. That number of votes may be cast for one nominee, divided equally among each of the nominees or divided among the nominees in any other manner.
In all matters other than the election of directors, the affirmative vote of the majority of shares of Common Stock present in person or represented by proxy at the meetingAnnual Meeting and entitled to vote on the subject matter wouldwill be the act of the stockholders. Directors will be elected by a plurality of the votes of the Common Stock present in person or represented by proxy.proxy at the Annual Meeting. Abstentions will be treated as the equivalent of a negative vote for the purpose of determining whether a proposal other than the election of directors has been adopted and will have no effect foron Proposal One, but will have the purpose of determining whethersame effect as a director has been elected. Broker non-votes are not counted for the purpose of determining thenegative vote on Proposal Two (because abstentions will be considered votes cast on a proposal.cast).
Any stockholder has the power to revoke his or her proxy at any time before it is voted at the meetingAnnual Meeting by submitting written notice of revocation to the Secretary of the Company at the Company’s principal executive offices located at 2027 Harpers Way, Torrance, California 90501, by appearing at the Annual Meeting and voting in person or by filing a duly executed proxy bearing a later date, either in person at the annual meeting,Annual Meeting, via the Internet, by telephone, or by mail. Please consult the instructions included with your proxy card.
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PROPOSAL 1
ELECTION OF DIRECTORS
The Certificate of Incorporation of the Company provides for the division of the Board of Directors into three classes as nearly equal in number as possible. In accordance with the Certificate of Incorporation, the Board of Directors has nominated Robert A. Virtue, Robert K. Montgomery, and Donald A. Patrick (each of whom is currently a director) to serve as Class II directors in Class III ofon the Board of Directors with a term expiring in 2009.at the 2012 Annual Meeting of Stockholders.
It is intended that the proxies solicited by this Proxy Statement will be voted in favor of the election of Messrs. Virtue, Montgomery, and Patrick, unless authority to do so is withheld. Should any of such nominees be unable to serve as a director or should any additional vacancy occur before the election (which events are not anticipated), proxies may be voted for a substitute nominee selected by the Board of Directors or the authorized number of directors may be reduced. If for any reason the authorized number of directors is reduced, the proxies will be voted, in the absence of instructions to the contrary, for the election of the remaining nominees named in this Proxy Statement. In the event that any person other than the nominees named below should be nominated for election as a director, the proxies may be voted cumulatively for less than all of the nominees.
The following table sets forth certain information with respect to each of the nominees, as well as each of the six continuing directors.The Board of Directors recommends that you vote “FOR” the election of the Class IIIII nominees.
| Director | ||||||||||||||||||||
Name | Age | Principal Occupation | Since | Age | Principal Occupation | Director Since | ||||||||||||||
Nominees for Directors Whose Terms Expire in 2009: | ||||||||||||||||||||
Nominees for Directors Whose Terms Expire in 2012: | ||||||||||||||||||||
| Robert A. Virtue | 73 | Chairman of the Board and Chief Executive Officer of the Company since 1990; President of the Company since August 1982. | 1956 | 76 | Chairman of the Board and Chief Executive Officer of the Company since 1990; President of the Company since August 1982. | 1956 | ||||||||||||||
| Robert K. Montgomery | 67 | Partner of Gibson, Dunn & Crutcher LLP law firm since 1971. | 2000 | 70 | Senior counsel of Gibson, Dunn & Crutcher LLP, a law firm in which Mr. Montgomery was a Partner from 1971 to 2008. | 2000 | ||||||||||||||
| Donald A. Patrick | 81 | Vice President and founder of Diversified Business Resources, Inc. (mergers, acquisitions and business consultants, 1988-2004). | 1983 | 84 | Vice President and founder of Diversified Business Resources, Inc. (mergers, acquisitions and business consultants) from 1988 to 2004. | 1983 | ||||||||||||||
Continuing Directors Whose Terms Expire in 2007: | ||||||||||||||||||||
Continuing Directors Whose Terms Expire in 2010: | ||||||||||||||||||||
| Douglas A. Virtue | 47 | Executive Vice President of the Company since December 1997; previously General Manager of the Torrance Division of the Company. | 1992 | 50 | Executive Vice President of the Company since December 1997; previously General Manager of the Torrance Division of the Company | 1992 | ||||||||||||||
| Evan M. Gruber | 52 | Chief Executive Officer and Chairman of the Board of Class Leasing, Inc. since 2004; previously Chief Executive Officer and Chairman of the Board of Modtech Holdings, Inc. | 2002 | |||||||||||||||||
| Thomas J. Schulte | 52 | Managing Partner of RBZ, a public accounting firm from 1997 to 2007. Currently Partner-In-Charge of RBZ Audit Group since 2007. | 2007 | |||||||||||||||||
| Albert J. Moyer | 62 | Board member of LaserCard Corporation, Collectors Universe, Inc. and California Amplifier, Inc.; Chief Financial Officer for QAD Inc. (1998-2000); President of the commercial division of the Profit Recovery Group International, Inc. (2000); consultant to QAD Inc. (2000-2002); Chief Financial Officer of Allergan Inc. (1995-1998). | 2004 | 65 | Board member of LaserCard Corporation, Occam Networks Inc., Collectors Universe, Inc. and CALAMP Corporation; Chief Financial Officer of Allergan Inc. (1995-1998); Chief Financial Officer for QAD Inc. (1998-2000); President of the commercial division of the Profit Recovery Group International, Inc. (2000); consultant to QAD Inc. (2000-2002); | 2004 | ||||||||||||||
Continuing Directors Whose Terms Expire in 2008: | ||||||||||||||||||||
Continuing Directors Whose Terms Expire in 2011: | ||||||||||||||||||||
| Donald S. Friesz | 76 | Vice President Sales and Marketing of the Company from 1982 to February 1996. Mr. Friesz has been retired since 1996. | 1992 | 79 | Vice President Sales and Marketing of the Company from 1982 to February 1996. Mr. Friesz has been retired since 1996. | 1992 | ||||||||||||||
| Glen D. Parish | 68 | Vice President of the Company and General Manager of the Conway Division from 1999 to 2004; previously Vice President of Conway Sales and Marketing. Mr. Parish has been retired since 2004. | 1999 | |||||||||||||||||
| James R. Wilburn | 73 | Dean of the School of Public Policy, Pepperdine University, since September 1997; previously Dean of the School of Business and Management, Pepperdine University (1982-1994); Professor of Business Strategy, Pepperdine University (1994-1996); Board member of The Olsen Company since 1990 and Independence Bank since 2004. | 1986 | |||||||||||||||||
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| Name | Age | Principal Occupation | Director Since | |||||||
| Glen D. Parish | 71 | Vice President of the Company and General Manager of the Conway Division from 1999 to 2004; previously Vice President of Conway Sales and Marketing. Mr. Parish has been retired since 2004. | 1999 | |||||||
| James R. Wilburn | 76 | Dean of the School of Public Policy, Pepperdine University, since September 1997; previously Dean of the School of Business and Management, Pepperdine University (1982-1994); Professor of Business Strategy, Pepperdine University (1994-1996); Board member of The Olsen Company since 1990, Independence Bank since 2004, and Electronic Sensor Tech since 2005. | 1986 | |||||||
BOARD COMMITTEES MEETINGS & COMPENSATIONMEETINGS
Meetings and CompensationIndependence
Each director of the Company serving in 2005fiscal 2008 with the exception of Mr. Montgomery attended at least 75% of the 2005 meetings of the Board of Directors and each committeecommittees on which he served. Mr. Montgomery attended all Board of Director meetings and committee meetings on which he served during fiscal 2008 except for the meetings of the Board of Directors, Compensation Committee, and Corporate Governance/Nominating Committee on December 9, 2008, which Mr. Montgomery could not attend because he was suffering from a severe case of the flu. The Board of Directors held six meetings in 2005.fiscal 2008. The Board of Directors has determined that the following directors, whichwho constitute a majority of the Board of Directors, to be “independent”are “independent directors” as defined by the AmericanNASDAQ Stock ExchangeMarket listing standards: Messrs. Friesz, Gruber, Moyer, Montgomery, Patrick, Parish, Schulte and Wilburn. Directors who are also officers of the Company receive no additional compensation for their services as directors. For the first three quarters of the year, non-employee directors received a retainer of $4,000 per quarter, an additional annual retainer of $2,000 per year for Committee chairmen, a fee of $1,000 for each Board meeting, a fee of $500 for each telephonic Board meeting and a fee of $750 for each committee meeting attended. On June 7, 2005, Messrs. Friesz, Gruber, Moyer, Montgomery, Patrick, Wilburn and Parish each received options to purchase 2,000 shares of Common Stock at $7.20 per share. Effective November 1, 2005, the non-employee director compensation program was modified to eliminate per meeting compensation and provide for an annual retainer of $50,000, of which (i) 75%Mr. R. Virtue is paid in equal quarterly installments and (ii) 25% is paid in the form of restricted stock grants, granted on the date of the annual shareholders meeting. In addition, each non-employee director is paid an annual retainer for each committee on which such director serves. Retainers for committee members are as follows: Mr. D. Virtue’s father.
Audit Committee chair $7,500, Audit Committee member $4,500, Corporate Governance/Nominating Committee chair $5,000, Corporate Governance/Nominating Committee member $3,000, Compensation Committee chair $5,000, Compensation Committee member $3,000. In January 2006, the Company cancelled all existing options for Common Stock previously granted by the Company for services as a director and held by the Company’s non-employee directors and granted restricted stock units to such non-employee directors in an amount equal to the number of options cancelled. The Company has established a pension plan for non-employee directors who have served as such for at least 10 years, providing for a series of quarterly payments (equal to the portion paid to the non-employee directors’ annual service fee) for such director’s lifetime following the date on which such director ceases to be a director for any reason other than death. Effective December 31, 2003, the Company froze all future benefit accruals under the pension plan.
The Board of Directors has a standing Audit Committee that in 2005fiscal 2008 was composed of Messrs. GruberSchulte (Chair), Friesz, Moyer and Patrick. The Audit Committee held twoon-site meetings and four telephonic meetings in 2005.fiscal 2008. The Audit Committee acts pursuant to a written charter adopted by the Board of Directors, a copy of which is attached as Appendix A to this proxy statement.Directors. The functions of the Audit Committee includeinclude: reviewing the financial statements of the Company,Company; reviewing the scope of the annual audit by the Company’s independent auditorsauditors; and reviewing the audit reports rendered by such independent auditors. Among other things, the Audit Committee is directly responsible forfor: the appointment, compensation, retention and oversight of the independent auditors, reviewsauditors; reviewing the independent auditors’ qualifications and independence, reviewsindependence; reviewing the plans and results of the audit engagement with the independent auditors, approvesauditors; approving professional services provided by the independent auditors and approvesapproving financial reporting principles and policies, considerspolicies; considering the range of audit and non-audit fees, reviewsnon- audit fees; reviewing the adequacy of the Company’s internal accounting controlscontrols; and worksworking to ensure the integrity of financial information supplied to stockholders. The Audit Committee also has the other responsibilities enumerated in its charter, and examines and considers additional matters as it deems appropriate. The Audit Committee’s charter is available to stockholders on ourthe Company’s website at www.virco.com. Each of the Audit Committee members is an “independent director” as defined by the listing standards of the AmericanNASDAQ Stock Exchange.Market. The Board of Directors has determined that Mr. Gruber,Schulte, who is the chair of the Audit Committee, qualifies as an “audit committee financial expert”,expert,” as that term is defined in Item 401(h)(2)407(d)(5) ofRegulation S-K of the Securities Exchange Act of 1934.1934 (the “Exchange Act”). The Board reevaluates the composition of the Audit Committee on an annual basis to ensure that its composition remains in the best interests of the Company and its stockholders.
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Compensation Committee
The Board of Directors has a standing Compensation Committee that in 2005fiscal 2008 was composed of Messrs. PatrickMoyer (Chair), Patrick, Montgomery and Wilburn, all of whom are “independent directors” as defined in the listing standards of the AmericanNASDAQ Stock Exchange.Market. The function of thisCompensation Committee is, toamong other
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things, to: set the Company’s compensation policy and administer the Company’s compensation plans; make recommendations todecisions on the compensation of key Company executives (including the review and approval of merit/other compensation budgets and payouts under the Company’s incentive plans); review and approve compensation and employment agreements of the Company’s executive officers; and recommend pay levels for members of the Board regarding changesof Directors for consideration and approval by the full Board of Directors. The Compensation Committee may consult with the Chief Executive Officer and other members of senior management as it deems necessary and engage the assistance of outside consultants to assist in salariesdetermining and benefits.establishing the Company’s compensation policies. [During fiscal 2008, the Company did not engage the assistance of compensation consultants.] The Compensation Committee held two on-site meetings in 2005.fiscal 2008. The Compensation Committee acts pursuant to a written charter adopted by the Board of Directors, a copy of which is available to stockholders on ourthe Company’s website atwww.virco.com.
Corporate Governance/Nominating Committee
The Board of Directors has a standing Corporate Governance/Nominating Committee which is comprised of Messrs. Montgomery (Chair), Friesz, Gruber,Moyer, Patrick, MoyerParish, Schulte and Wilburn, all of whom are “independent directors” as defined in the listing standards of the AmericanNASDAQ Stock Exchange.Market. During fiscal 2005,2008, the Corporate Governance/Nominating Committee held threetwo meetings. Each of these meetings in executive sessionswere held outside the presence of management and intends to hold at least two such meetings in fiscal 2006 as well.management.
The Corporate Governance/Nominating Committee’s function is to identify and recommend from time to time candidates for nomination for election as directors of the Company. Candidates may come to the attention of the Corporate Governance/Nominating Committee through members of the Board of Directors, stockholders or other persons. Consideration of new Board nominee candidates typically involves a series of internal discussions, review of information concerning candidates and interviews with selected candidates. Candidates are evaluated at regular or special meetings, and may be considered at any point during the year, depending on the Company’s needs. The Corporate Governance/Nominating Committee acts pursuant to a written charter adopted by the Board of Directors, a copy of which is available to stockholders on ourthe Company’s website at www.virco.com. In evaluating nominations, the Corporate Governance/Nominating Committee considers a variety of criteria, including business experience and skills, independence, judgment, integrity, the ability to commit sufficient time and attention to Board of Directors activities and the absence of potential conflicts with the Company’s interests. The Corporate Governance/Nominating Committee has not established any specific minimum qualification standards for nominees to the Board of Directors, although from time to time the Corporate Governance/Nominating Committee may identify certain skills or attributes (e.g.,financial experience, business experience) as being particularly desirable to meet specific Board of Director needs that may arise. To nominaterecommend a prospective nominee for the Corporate Governance/Nominating Committee’s consideration, you may submit, in accordance with the Company’s bylaws,Bylaws, a candidate’s name and qualifications to Virco’sthe Company’s Corporate Secretary at 2027 Harpers Way, Torrance, California 90501.
90501, Attention: Robert E. Dose.
Communications with the Board of Directors
Any stockholder interested in communicating with individual members of the Board of Directors, the Board of Directors as a whole, any of the committees of the Board or the independent directors as a group may send written communications to the Board of Directors, any committee of the Board of Directors or any of thedirector or directors toof the Company at 2027 Harpers Way, Torrance, California 90501, Attention: Robert E. Dose, Secretary. Communications received in writing are forwarded to the Board of Directors, or the committee or individual director or directors to whom the communication is directed, unless, inat his discretion, the Secretary determines that the communication is of a commercial or frivolous nature, is unduly hostile, threatening, illegal, does not reasonably relate to the Company or its business, or is otherwise inappropriate for the Board’sBoard of Directors’ consideration. In such cases, some of thatsuch correspondence may be forwarded elsewhere in the Company for review and possible response. The Secretary has the authority to discard or disregard any inappropriate communications or to take other appropriate actions with respect to any such inappropriate communications. Directors are expected to attend the annual meetingsAnnual Meeting of stockholders.Stockholders. Last year eightall of the nine directors attended the annual meeting.2008 Annual Meeting of Stockholders. The independent directors hold two regularly scheduled executive session meetings each fiscal year outside the presence of management as well as additional such meetings as are necessary. Mr. Moyer currently functions as the lead independent director. The lead independent director position rotates among the independent directors periodically as determined by the independent directors.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Shares Owned By Directors, Management and Principal Stockholders
The following table sets forth information as of April 21, 200624, 2009 (unless otherwise indicated), relating to the beneficial ownership of the Company’s Common Stock (i) by each person known by the Company to own beneficially more than 5% of the outstanding shares of Common Stock of the Company, (ii) by each director or nominee of the Company, (iii) by each executive officerNamed Executive Officer of the Company as named in the Summary Compensation Table below and (iv) by all executive officers and directors of the Company as a group. The number of shares beneficially owned is deemed to include shares of Common Stock in which the persons named have or share either investment or voting power. Unless otherwise indicated, the mailing address of each of the persons named is c/o Virco Mfg. Corporation, 2027 Harpers Way, Torrance, California 90501.
| Amount and Nature | ||||||||
| of Beneficial | Percent of | |||||||
| Name of Beneficial Owner | Ownership(1) | Class | ||||||
| Wedbush Inc.(2) | 1,759,273 | 12.18 | % | |||||
| Nancy Virtue-Cutshall(3) | 865,856 | 6.10 | % | |||||
| David P. Cohen(4) | 804,134 | 5.67 | % | |||||
| Towle & Co.(5) | 780,300 | 5.51 | % | |||||
| Robert A. Virtue(6) (7) Chairman of the Board of Directors, President and Chief Executive Officer | 304,807 | 2.15 | % | |||||
| Douglas A. Virtue(7) Director, Executive Vice President | 612,214 | 4.32 | % | |||||
| Donald S. Friesz Director | 72,159 | (8) | ||||||
| Thomas J. Schulte Director | 6,933 | (8) | ||||||
| Albert J. Moyer Director | 13,453 | (8) | ||||||
| Robert K. Montgomery Director | 24,404 | (8) | ||||||
| Glen D. Parish Director, Former Vice President, General Manager | 36,045 | (8) | ||||||
| Donald A. Patrick Director | 57,382 | (8) | ||||||
| James R. Wilburn Director | 24,259 | (8) | ||||||
| Robert E. Dose Vice President Finance, Secretary, Treasurer | 26,092 | (8) | ||||||
| Lori L. Swafford Vice President & Corporate Counsel | 20,186 | (8) | ||||||
| Larry O. Wonder Vice President, Sales | 43,108 | (8) | ||||||
| All executive officers and directors as a group (18 persons) | 1,379,117 | 9.67 | % | |||||
| Amount and Nature | ||||||||
| of Beneficial | Percent of | |||||||
Name of Beneficial Owner | Ownership(1) | Class | ||||||
| Bruce S. Sherman/Gregg J. Powers(2) | 1,436,812 | 10.94 | % | |||||
| Nancy Virtue-Cutshall(3) | 911,856 | 6.94 | % | |||||
| Rodger Virtue | 713,672 | 5.43 | % | |||||
| Kathleen Virtue-Young(4) | 671,137 | 5.11 | % | |||||
| Buckhead Capital Management LLC(5) | 666,390 | 5.07 | % | |||||
| Robert A. Virtue | 335,380 | 2.55 | % | |||||
| Chairman of the Board of Directors, | ||||||||
| Chief Executive Officer(6) | ||||||||
| Douglas A. Virtue | 569,308 | 4.33 | % | |||||
| Director, Executive Vice President | ||||||||
| Donald S. Friesz | 62,639 | (7) | ||||||
| Director | ||||||||
| Evan M. Gruber | 2,500 | (7) | ||||||
| Director | ||||||||
| Albert J. Moyer | 0 | (7) | ||||||
| Director | ||||||||
| Robert K. Montgomery | 0 | (7) | ||||||
| Director | ||||||||
| Glen D. Parish | 26,833 | (7) | ||||||
| Director, Former Vice President, General Manager | ||||||||
| Donald A. Patrick | 53,068 | (7) | ||||||
| Director | ||||||||
| James R. Wilburn | 4,778 | (7) | ||||||
| Director | ||||||||
| Robert E. Dose | 54,503 | (7) | ||||||
| Vice President Finance, Secretary, Treasurer | ||||||||
| Lori L. Swafford | 26,255 | (7) | ||||||
| Vice President, Legal Affairs | ||||||||
| Larry O. Wonder | 33,983 | (7) | ||||||
| Vice President, Sales | ||||||||
| All executive officers and directors as a group (18 persons) | 1,274,616 | (8) | 9.58 | %(8) | ||||
| (1) | Except as indicated in the footnotes to this table and pursuant to applicable community property laws, to the knowledge of the Company, the persons named in this table have sole voting and investment power with respect to all shares beneficially owned by them. For purposes of this table, a person is deemed to |
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| Wilburn, Dose, Swafford, Wonder, and all executive officers and directors as a group, include |
5
| 5,196, 5,196, 0, 0, 0, 0, | ||
| (2) | ||
| (3) | Reflects information as of December 31, 2008 as reported in a Schedule 13G/A filing on February 10, 2009. Includes | |
| (4) | ||
| (5) | ||
| (6) | ||
| (7) | ||
| Douglas A. Virtue is Robert A. Virtue’s son. The total number of shares beneficially owned by Mr. Robert A. Virtue, his brothers Raymond W. Virtue and Richard J. Virtue, his sister, Nancy Virtue-Cutshall, their children (which includes Mr. Douglas A. Virtue) and their mother, Mrs. Julian A. Virtue, aggregate | ||
| (8) | Less than 1%. |
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EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Objectives of the Compensation Program
The objectives of the Company’s executive compensation program are to: 1) attract, motivate and retain highly qualified executives; 2) link total compensation to stockholder returns; 3) reflect individual contributions to the performance of the Company; 4) insure appropriate balance between long-term value creation and short-term performance by including equity as part of total compensation; and 5) maintain internal fairness and morale by benchmarking executive compensation, including perquisites and non-cash benefits, against the aggregated average compensation and benefits of the Company’s top 25 managers.
The Compensation Committee recommends and the Board approves the base salaries, annual bonus plan, and long term incentives of the Company’s Chief Executive Officer (the “CEO”), Chief Financial Officer (the “CFO”), and the three other most highly compensated executives. Throughout this Compensation Discussion & Analysis (“CD&A”), the CEO, CFO and three other most highly compensated executives are referred to collectively as the “Named Executive Officers.”
The program is designed to support annual and long-term business goals that create profitable growth and long-term value for stockholders.
Elements of Compensation Program
The following table sets forthCompany’s executive compensation program consists of three main elements: 1) base salary, which is tied to individual job duties; 2) annual bonus plan cash incentives, which are mathematically linked to the Company’s Annual Operating Plan, including pre-tax profit; and 3) long-term equity incentives, the value of which are contingent upon successful execution of the Company’s multi-year strategic growth and market development initiatives. Ancillary benefits such as health insurance, retirement benefits, and an automobile allowance are also part of the executive compensation program. As with the three main elements of the program, these ancillary benefits are benchmarked against similar benefits provided to the Company’s top 25 managers.
The combination of base salary, annual incentive, long-term incentive, and ancillary benefits is referred to as Total Compensation. The Company has established a target of “market median” for the Total Compensation of Named Executive Officers as determined by scale-, geography- and date-adjusted national compensation surveys from Wyatt Total Reward, Wyatt CQ Survey, Mercer Manufacturing Compensation Survey, Mercer Manufacturing Industry Market View, National Assoc. of Manufacturers, and Employers Group Research Services Survey.
All of these surveys are given equal weighting. The Company intentionally uses a broad comparison group for executive compensation because the competition for executive talent extends beyond the Company’s direct competitors and industry. The Company believes that this breadth of executive compensation data, conservatively adjusted for firm size, geographic location and cost of living, and the age of the data, provides for the fairest and most equitable “market median.” The same method of establishing a market median total compensation target is used for the Company’s top 25 managers.
In determining the final Total Compensation for Named Executive Officers, the Compensation Committee attempts to balance “external equity” as defined by “market median,” with “internal equity” as defined by the aggregated average Total Compensation for the Company’s top 25 managers. It is the Company’s belief that this approach to establishing Total Compensation for Named Executive Officers results in better teamwork and morale
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among the entire management team, thus linking executive and management compensation with short- and long-term value creation for stockholders.
Base Salary
Base salary is intended to reward Named Executive Officers and other employees for their roles within the Company and their performance in those roles. The Company determines the base salary range for a particular position by evaluating 1) the duties, complexities and responsibilities of the position; 2) the level of experience required; and 3) the compensation for services renderedpositions having similar scope and accountability within and outside the Company (through survey data as described above). The Company did not increase base salaries for the Named Executive Officers for fiscal 2008 and does not anticipate increasing base salaries for Named Executive Officers in all capacitiesfiscal 2009.
Annual Incentives
The Named Executive Officers are eligible for annual cash incentives under the Company’s Annual Bonus Plan, which is approved by the Board of Directors at the beginning of the Company’s fiscal year as part of its Annual Operating Plan. To reward Named Executive Officers and other salaried managers for achieving the financial performance set forth in the Annual Operating Plan, the Board of Directors establishes a minimum level of financial performance and return to stockholders above which a cash bonus will be paid. For achieving the minimum threshold, the Named Executive Officers receive a cash bonus equal to 15% of their base salary. For achieving the “target” pre-tax earnings, Named Executive Officers receive a 35% cash bonus. The maximum possible cash bonus for Named Executive Officers is capped at 50% of base salary. The threshold, target and maximum bonus levels for each Named Executive Officer were determined by reference to the Companysurvey data and its subsidiaries duringother factors described above.
For fiscal 2008, the years indicatedthreshold for receiving a minimum bonus was $10,000,000 in pre-tax earnings, after accruing an earned bonus provision of approximately $206,000 for the ChiefNamed Executive OfficerOfficers. No cash bonus payment was made to the Named Executive Officers under the Annual Bonus Plan for fiscal 2008 as the Company’s pre-tax earnings did not exceed this threshold.
For fiscal 2008, the Board of Directors approved a discretionary bonus for all employees that participated in the Annual Bonus Plan, including the Named Executive Officers. The Board determined that although the Company did not meet the profit objective, the Company had met several significant objectives and had achieved these objectives in an extremely challenging economic environment. Metrics considered by the other four most highly compensated officersBoard of the Company:Directors included:
| Long-Term | ||||||||||||||||||||
| Annual Compensation | Compensation | |||||||||||||||||||
| Restricted | ||||||||||||||||||||
| Stock | All Other | |||||||||||||||||||
Name and Principal Position | Year | Salary(1) | Bonus | Awards(2) | Compensation(3) | |||||||||||||||
| Robert A. Virtue | 2005 | $ | 421,233 | $ | — | $ | — | $ | — | |||||||||||
| Chairman of the Board and | 2004 | 385,811 | — | — | — | |||||||||||||||
| Chief Executive Officer | 2003 | 393,923 | — | — | 9,400 | |||||||||||||||
| Douglas A. Virtue | 2005 | 222,873 | — | — | — | |||||||||||||||
| Executive Vice President | 2004 | 214,903 | — | — | — | |||||||||||||||
| 2003 | 184,996 | — | — | 3,900 | ||||||||||||||||
| Robert E. Dose | 2005 | 222,688 | �� | — | — | — | ||||||||||||||
| Vice President, Finance, | 2004 | 216,378 | — | 103,650 | — | |||||||||||||||
| Secretary and Treasurer | 2003 | 202,553 | — | — | 4,700 | |||||||||||||||
| Lori L. Swafford | 2005 | 205,989 | — | — | — | |||||||||||||||
| Vice President, Legal Affairs | 2004 | 197,810 | — | 103,650 | — | |||||||||||||||
| 2003 | 165,020 | — | — | 2,600 | ||||||||||||||||
| Larry O. Wonder | 2005 | 191,985 | — | — | — | |||||||||||||||
| Vice President, Sales | 2004 | 203,235 | — | 103,650 | 3,900 | |||||||||||||||
| 2003 | 189,754 | — | — | 3,900 | ||||||||||||||||
| • | |||
| • | The Company successfully extended its $65 million line of credit to | ||
| • | The Company | ||
| • | The Company anticipated the | ||
| • | The Company successfully enhanced the Virco brand through new product launches, extensions of significant customer contracts, and expanded relationships with strategic vendor partners. |
The actual discretionary bonus payout for the Named Executive Officers for fiscal 2008 was $64,218, equal to approximately 9% of each Named Executive Officers base salary for fiscal 2008. Robert A. Virtue and Douglas A. Virtue declined to accept payment of any discretionary bonus.
The Company believes that the most powerful incentive to focus Named Executive Officers on long-term value creation is long-term ownership of Company stock. Under the Company’s current long-term incentive program, Named Executive Officers and top managers receive periodic grants of Restricted Stock Units (“RSUs”). The Company uses RSUs rather than options because it has been the Company’s experience that RSUs
8
are more likely to result in a growing ownership position of Company stock and thereby align the interests of executives and stockholders. The Company did not grant any stock options or stock appreciation rightsRSUs to anyNamed Executive Officers in fiscal 2008. On the date of the executive officers named2007 Annual Meeting of Stockholders and Board of Directors meeting on June 19, 2007, each Named Executive Officer was granted 15,000 RSUs, vesting ratably over a five year period. The number of RSUs granted to each Named Executive Officer in fiscal 2007 was determined by reference to historical grant levels provided to Company executives, as well as the factors described above. Each Named Executive Officer received the same number of RSUs in order to foster internal pay equity and the Company’s “one-team” management approach.
If awarded, grants of RSUs are typically approved at the Board of Directors meeting immediately following the Annual Meeting of Stockholders. The meeting dates are set well in advance and occur approximately two weeks following the release of the First Quarter results. Scheduling decisions are made without regard to anticipated earnings or other major announcements by the Company.
Other Compensation Elements
Perquisites— The Company provides Named Executive Officers with a Company automobile or cash allowance of $22,800 per year under a program available to all Officers of the Company. The Company does not provide Named Executive Officers with any other perquisites such as country club memberships and the Company does not own or lease an aircraft. Company-provided travel for executives is for business purposes only.
Other Benefits— Executives participate in the Summary Compensation Table above duringsame health, disability and life insurance programs as are provided to other Company employees. In addition, the Named Executive Officers participate in the Company’s tax-qualified defined benefit pension plan (the Virco Mfg. Corporation Employees Retirement Plan) and nonqualified supplement retirement plan (the Virco Important Performers (VIP) Plan). As more fully disclosed in the MD&A and Footnote 4 to the financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2006.2009 (“Form 10-K”), these retirement plans were frozen effective December 31, 2003, and additional benefit accruals for all Named Executive Officers ceased on that date.
7
| Number of securities | ||||||||||||
| remaining available for | ||||||||||||
| future issuance under | ||||||||||||
| Number of securities to | Weighted-average | equity compensation | ||||||||||
| be issued upon exercise | exercise price of | plans (excluding | ||||||||||
| of outstanding options, | outstanding options, | securities reflected in | ||||||||||
Plan category | warrants and rights | warrants and rights | column (a)) | |||||||||
| (a) | (b) | (c) | ||||||||||
| Equity compensation plans approved by security holders | 293,000 | $ | 11.56 | 116,000 | ||||||||
| Equity compensation plans not approved by security holders | None | None | None | |||||||||
| Total | 293,000 | $ | 11.56 | 116,000 | ||||||||
8
evaluating strategic alternatives.
The Employees Retirement PlanCompany seeks to structure its compensation arrangements to maximize the tax deductibility of all components of executive compensation unless the Companybenefit of such deductibility is a non-contributory, defined benefit retirement plan governedoutweighed by the Employee Retirement Income Security Actneed for flexibility or the attainment of 1974. With limited exceptions,other corporate objectives. The Compensation Committee will continue to monitor issues concerning the deductibility of executive compensation and will take appropriate action if and when it is warranted. Since corporate objectives may not always be consistent with the requirements for full deductibility, the Compensation Committee is prepared, if it deems appropriate, to enter into compensation arrangements under which payments may not be fully deductible. Thus, deductibility will not be the sole factor used by the Compensation Committee in ascertaining appropriate levels or modes of compensation. In fiscal 2008, all employees of the Company and its participating subsidiaries (including executive officers) are eligible to participate provided they meet certain service requirements. Benefits arecompensation paid to or on behalf of each participant upon retirement, normally at age 65, and under certain circumstances upon death. Benefits under the plan are credited to the employee each year based upon years of service and remuneration during such year of service.
| Years of Service(2) (3) | ||||||||||||
Assumed Average Compensation(1) | 10 | 20 | 30 | |||||||||
| $ 25,000 | $ | 2,260 | $ | 4,520 | $ | 6,780 | ||||||
| 50,000 | 4,760 | 9,520 | 14,280 | |||||||||
| 75,000 | 7,260 | 14,520 | 21,780 | |||||||||
| 100,000 | 9,760 | 19,520 | 29,280 | |||||||||
| 125,000 | 12,260 | 24,520 | 36,780 | |||||||||
| 150,000 | 14,760 | 29,520 | 44,280 | |||||||||
| 175,000 | 15,760 | 31,519 | 47,279 | |||||||||
9
Impact of Prior Compensation in Setting Elements of Compensation
Prior compensation of the Named Executive Officers does not impact how the Company terminatedsets elements of current compensation. The Compensation Committee believes the life insurance plan, other than for one employeecompetitive environment that the Company operates in mandates that current total compensation be set at levels sufficient to attract, motivate and retain top management, which requires the Company to set compensation amounts based on current Company and business conditions.
Executive Stock Ownership Guideline
The Company has not adopted executive stock ownership guidelines. While there are no guidelines, two of the Named Executive Officers, Robert A. Virtue and Douglas A. Virtue, own 2.2% and 4.3%, respectively, of the outstanding shares of the Company’s Common Stock. Messrs. R. Virtue and D. Virtue are members of the Virtue Family and subject to the terms of the Virtue Family Agreement discussed in the “Security Ownership” section of this Proxy Statement. The Virtue Family owns approximately 40% of the Company’s outstanding Common Stock.
Impact of Restatements that Retroactively Impact Financial Goals
The Company has not restated or retroactively adjusted financial information that has impacted the financial statements or goals related to previous bonus or long-term award payouts. If financial results are significantly restated due to extenuating circumstances. fraud or intentional misconduct, the Board will review any performance-based compensation paid to Named Executive Officers who are found to be personally responsible for the fraud or intentional misconduct that led to the restatement and may, to the extent permitted by applicable law, seek to recover amounts paid in excess of the amounts that would have been paid based on the restated financial results.
The Company eliminatedRole of the planExecutives in Determining Compensation
While the Compensation Committee is primarily responsible for active employees altogether priorreviewing and making determinations with respect to executive compensation, the CEO and Executive Vice President provide input and views with respect to compensation for the other Named Executive Officers. The Compensation Committee believes that the CEO’s and Executive Vice President’s views are critical in determining the compensation of other Named Executive Officers because the CEO and Executive Vice President have day-to-day involvement with these Named Executive Officers and are in the best position to assess their performance, abilities, and contribution to the success of the Company.
Compensation Committee Report
The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis for the year ended January 31, 2006.
COMPENSATION COMMITTEE
Albert J. Moyer, Chair
Donald A. Patrick
Robert K. Montgomery
Dr. James R. Wilburn
Donald A. Patrick
Robert K. Montgomery
Dr. James R. Wilburn
10
The above report of the Compensation Committee will not be deemed to be paidincorporated by reference into any filing by the Company uponunder the deathsSecurities Act or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.
Compensation Committee Interlocks and Insider Participation
During fiscal 2008, the Compensation Committee was comprised of Messrs. Julian A. VirtueMoyer, Patrick, Montgomery, and Donald Heyl, the former Presidents of the Company. The widows of Mr. Virtue and Mr. Heyl are currently receiving $5,000 per month under the plan. In 2005, the Company paid $60,000 to each of Mrs. Virtue and Mrs. Heyl.
Summary Compensation Table for Fiscal 2008, 2007 & 2006
The table below sets forth the compensation awarded to, earned by, or paid to, each of the Named Executive Officers for Fiscal 2008, 2007 and 2006. The Company has no employment agreements with any of its executives. While employed, executives are entitled to base salary, participation in the executive compensation programs identified in the tables below and discussed in the CD&A and other benefits common to all employees. The performance-based conditions associated with the Bonus Plan as well as salary and bonus in proportion to total compensation are discussed in detail throughout the CD&A.
| Non-Equity | ||||||||||||||||||||||||||||||||
| Stock | Incentive Plan | Change | All Other | |||||||||||||||||||||||||||||
| Name and Position | Year | Salary | Bonus | Awards | (Bonus Plan) | in Pension | Compensation | Total | ||||||||||||||||||||||||
| Robert A. Virtue | 2008 | $ | 420,580 | $ | — | $ | 20,340 | $ | — | $ | — | $ | 11,156 | $ | 452,076 | |||||||||||||||||
| President & CEO | 2007 | 408,768 | — | 11,865 | 153,972 | 115,239 | 15,142 | 704,986 | ||||||||||||||||||||||||
| 2006 | 427,058 | — | — | 159,257 | 93,191 | 23,246 | 702,752 | |||||||||||||||||||||||||
| Douglas A. Virtue | 2008 | 261,234 | — | 20,340 | — | — | 7,592 | 289,166 | ||||||||||||||||||||||||
| Executive Vice President | 2007 | 258,715 | — | 11,865 | 98,982 | — | 8,372 | 377,934 | ||||||||||||||||||||||||
| 2006 | 228,371 | — | — | 100,404 | 118,663 | 18,498 | 465,936 | |||||||||||||||||||||||||
| Robert E, Dose | 2008 | 270,292 | 23,906 | 41,070 | — | 22,750 | 358,018 | |||||||||||||||||||||||||
| Vice President Finance | 2007 | 248,080 | — | 32,595 | 93,483 | 2,228 | 26,200 | 402,586 | ||||||||||||||||||||||||
| 2006 | 225,000 | — | 20,730 | 96,131 | 108,112 | 34,780 | 484,753 | |||||||||||||||||||||||||
| Lori L. Swafford | 2008 | 230,580 | 21,563 | 41,070 | — | 26,168 | 319,381 | |||||||||||||||||||||||||
| Vice President & | 2007 | 224,330 | — | 32,595 | 84,318 | — | 29,244 | 370,487 | ||||||||||||||||||||||||
| Corporate Counsel | 2006 | 205,000 | — | 20,730 | 87,586 | 73,317 | 38,372 | 425,005 | ||||||||||||||||||||||||
| Larry O. Wonder | 2008 | 200,580 | 18,750 | 41,070 | — | 12,418 | 272,818 | |||||||||||||||||||||||||
| Vice President Sales | 2007 | 197,068 | — | 32,595 | 73,320 | 8,229 | 16,277 | 327,489 | ||||||||||||||||||||||||
| 2006 | 189,630 | — | 20,730 | 77,161 | 116,740 | 24,155 | 428,416 | |||||||||||||||||||||||||
| (1) | The amounts shown in this column reflect the discretionary bonus approved by the Board of Directors. | |
| (2) | The amounts is the compensation expense recognized by the Company in the financial statements for the applicable fiscal year pursuant to Statement of Financial Accounting Standards No. 123R (“FAS 123R”). The assumptions used to calculate these figures are described in Footnote #5 of the Company’s Form 10-K. The Value on Vesting of RSUs granted in June 2004 is calculated by multiplying the number of shares vested by the difference between the market price on grant date of $4.99 per share on the date of vesting less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. The Value on Vesting of RSUs granted in June 2007 is calculated by multiplying the number of shares vested by the difference between the market price on grant date of $4.92 per share on the date of vesting less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. |
11
| (3) | The amounts shown in this column are based on the same assumptions used in the preparation of the Company’s fiscal 2008 financial statements, which are described in the MD&A and Footnote #4 to the Company’s Form 10-K. The Pension Plans that Executive Officers participate in were frozen in 2003. The Executive Officers did not accrue any additional benefits during fiscal 2008. The Change in Pension amount includes the effect of a change in discount rate from 6.00% in fiscal 2007 to 6.75% in fiscal 2008, and the decrease in the discount period. Due to the change in discount rates, the change in pension value for Robert A. Virtue decreased by $310,578, Douglas A. Virtue decreased by $37,957, Robert E. Dose decreased by $30,391, Lori Swafford decreased by $34,404, and Larry O. Wonder decreased by $22,228. | |
| (4) | The amounts in this column include automobile allowances, the value of personal use of a Company provided vehicle, payments under a mortgage assistance plan that was terminated in May 2007, and medical insurance for domestic partners |
Grants of Plan-Based Awards for Fiscal 2008
The table below sets forth the grants of plan-based awards to the Named Executive Officers during fiscal 2008 under the Bonus Plan. Such awards include monetary compensation under the Bonus Plan.
| Estimated Future Payouts Under | ||||||||||||||
| Grant | Non-Equity Incentive Plan Awards | |||||||||||||
| Name and Position | Date | Threshold ($) | Target ($) | Maximum($) | ||||||||||
| Robert A. Virtue President & CEO | N/A | 63,000 | 147,000 | 210,000 | ||||||||||
| Douglas A. Virtue Executive Vice President | N/A | 40,500 | 94,500 | 135,000 | ||||||||||
| Robert E, Dose Vice President Finance | N/A | 38,250 | 89,250 | 127,500 | ||||||||||
| Lori L. Swafford Vice President & Corporate Counsel | N/A | 34,500 | 80,500 | 115,000 | ||||||||||
| Larry O. Wonder Vice President Sales | N/A | 30,000 | 70,000 | 100,000 | ||||||||||
| (1) | Cash amounts in this table pertain the Bonus Plan described under “Annual Incentives” in the CD&A. |
Outstanding Equity Awards at Fiscal Year-End 2008
The following table sets forth the Named Executive Officers’ outstanding equity awards as of the end of fiscal 2008. All outstanding stock option awards reported in this table expire 10 years from the date of grant. All outstanding grants of RSUs vest over a five year period from the grant date.
| Stock Awards | ||||||||||||||||||||
| Shares or Units | Market Value of | |||||||||||||||||||
| Year | Option | Option | of Stock That | Shares or Units of | ||||||||||||||||
| of | Exercise | Expiration | Have Not | Stock That Have | ||||||||||||||||
| Name and Title | Award | Price ($) | Date | Vested (#) | Not Vested ($) | |||||||||||||||
| Robert A. Virtue | 2007 | 11.06 | 07/23/2009 | 12,000 | 25,080 | |||||||||||||||
| President & CEO | ||||||||||||||||||||
12
| Stock Awards | ||||||||||||||||||||
| Shares or Units | Market Value of | |||||||||||||||||||
| Year | Option | Option | of Stock That | Shares or Units of | ||||||||||||||||
| of | Exercise | Expiration | Have Not | Stock That Have | ||||||||||||||||
| Name and Title | Award | Price ($) | Date | Vested (#) | Not Vested ($) | |||||||||||||||
| Douglas A. Virtue | 2007 | 11.06 | 07/23/2009 | 12,000 | 25,080 | |||||||||||||||
| Executive Vice President | ||||||||||||||||||||
| Robert E. Dose | 2004 | 11.06 | 07/23/2009 | 3,000 | 6,270 | |||||||||||||||
| Vice President Finance | 2007 | 12,000 | 25,080 | |||||||||||||||||
| Lori L. Swafford | 2004 | 11.06 | 07/23/2009 | 3,000 | 6,270 | |||||||||||||||
| Vice President & Corporate Counsel | 2007 | 12,000 | 25,080 | |||||||||||||||||
| Larry O. Wonder | 2004 | 11.06 | 07/23/2009 | 3,000 | 6,270 | |||||||||||||||
| Vice President Sales | 2007 | 12,000 | 25,080 | |||||||||||||||||
| (1) | All RSUs vest at 20% per year for five years from the grant date. All outstanding options are fully vested. For the 3,000 RSUs remaining from June 30, 2004 RSU award included in this table there is one remaining vesting date: June 30, 2009. For the 12,000 RSUs remaining from the June 17, 2007 RSU award there are four remaining vesting dates: June 17, 2009, June 17, 2010, June 17, 2011, and June 17, 2012. | |
| (2) | All year-end dollar values were computed based on the fiscal year-end closing price of $2.10 per share of common stock less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. |
Option Exercises and Stock Vested for Fiscal 2008
The following table sets forth information concerning the Named Executive Officers’ exercise of stock options and vesting of RSUs during fiscal 2008.
| Number of Shares | Value Realized on | |||||||
| Acquired on Vesting | Vesting | |||||||
| Name and Position | (#) | ($) | ||||||
| Robert A. Virtue | 3,000 | 14,760 | (1) | |||||
| President & CEO | ||||||||
| Douglas A. Virtue | 3,000 | 14,760 | (1) | |||||
| Executive Vice President | ||||||||
| Robert E, Dose | 3,000 | 14,760 | (1) | |||||
| Vice President Finance | 3,000 | 14,970 | (2) | |||||
| Lori L. Swafford | 3,000 | 14,760 | (1) | |||||
| Vice President & Corporate Counsel | 3,000 | 14,970 | (2) | |||||
| Larry O. Wonder | 3,000 | 14,760 | (1) | |||||
| Vice President Sales | 3,000 | 14,970 | (2) | |||||
| (1) | The Value Realized on Vesting of RSUs is calculated by multiplying the number of shares vested by the difference between the closing market price of $4.92 per share on the date of vesting less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. | |
| (2) | The Value Realized on Vesting of RSUs is calculated by multiplying the number of shares vested by the difference between the closing market price of $4.99 per share on the date of vesting less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. |
13
Pension Benefits for Fiscal 2008
The following table sets forth information concerning the payments available under the Virco Important Performers (VIP) Plan and the Virco Mfg. Corporation Employees Retirement Plan, both of whose benefit accruals were frozen in 2003.
| Number of | Payments | |||||||||||||||
| Years of | Present Value of | During Last | ||||||||||||||
| Credited | Accumulated | Fiscal Year | ||||||||||||||
| Name and Position | Plan Name | Service (#) | Benefit ($) (1) (2) | ($) | ||||||||||||
| Robert A. Virtue | Virco Important | |||||||||||||||
| President & CEO | Performers (VIP) Plan | 18 | 1,547,800 | 201,539 | ||||||||||||
| Virco Mfg. Corporation | ||||||||||||||||
| Employees Retirement Plan | 46 | 2,109,946 | 126,162 | |||||||||||||
| Douglas A. Virtue | Virco Important | |||||||||||||||
| Executive Vice President | Performers (VIP) Plan | 10 | — | — | ||||||||||||
| Virco Mfg. Corporation | ||||||||||||||||
| Employees Retirement Plan | 17 | 377,189 | — | |||||||||||||
| Robert E, Dose | Virco Important | |||||||||||||||
| Vice President Finance | Performers (VIP) Plan | 10 | — | — | ||||||||||||
| Virco Mfg. Corporation | ||||||||||||||||
| Employees Retirement Plan | 12 | 373,351 | — | |||||||||||||
| Lori L. Swafford | Virco Important | |||||||||||||||
| Vice President Legal Affairs | Performers (VIP) Plan | 7 | — | — | ||||||||||||
| Virco Mfg. Corporation | ||||||||||||||||
| Employees Retirement Plan | 7 | 219,826 | — | |||||||||||||
| Larry O. Wonder | Virco Important | |||||||||||||||
| Vice President Sales | Performers (VIP) Plan | 13 | — | — | ||||||||||||
| Virco Mfg. Corporation | ||||||||||||||||
| Employees Retirement Plan | 24 | 479,080 | — | |||||||||||||
| (1) | The amounts in this column are based on the same assumptions used in the preparation of the Company’s fiscal 2008 financial statements, which are described in the MD&A and Footnote #4 to the Company’s Form 10-K. | |
| (2) | The Pension Plans that the Named Executive Officers participate in was frozen in 2003. The Named Executive Officers did not accrue any additional benefits during fiscal 2008. The Change in Pension amount includes the effect of a change in discount rate from 6.00% in fiscal 2007 to 6.75% in fiscal 2008, and the decrease in the discount period. |
Nonqualified Deferred Compensation for Fiscal 2008
The Company does not have a deferred compensation plan.
Potential Payments upon Termination or Change-in-Control
As discussed in the CD&A above, the Company does not have employment agreements with any of the Named Executive Officers. Retirement, death, disability and change-in-control events do not trigger the payment of compensation to the Named Executive Officers that is not available to all salaried employees (including the amounts
14
included in the “Pension Benefits for Fiscal 2008” table). Named Executive Officers do not have a contractual right to receive severance benefits.
As noted in “Post-Employment and Other Events,” pursuant to the Company’s 1997 and 2007 Stock Incentive Plans, the vesting of all outstanding stock and options awards is accelerated upon a change-in-control. In addition, under the Virco Important Performers (VIP) Plan, the vesting of retirement benefits is accelerated upon the occurrence of a change-in-control or the death of the participant. Change-in-control is defined as a party other than the members of the Virtue family accumulating 20% or more of the Company’s Common Stock. The following table quantifies compensation that would be payable to the Named Executive Officers upon a change-in-control. The tables assume that the event occurred on the last business day of fiscal 2008.
Value in Event of Change-in-Control with or without Employment Termination
| Stock Awards | ||||||||
| Number of Shares | Value Realized on | |||||||
| Acquired on Vesting | Vesting | |||||||
| Name and Position | (#) | (1) ($) | ||||||
| Robert A. Virtue | 12,000 | 25,080 | ||||||
| President & CEO | ||||||||
| Douglas A. Virtue | 12,000 | 25,080 | ||||||
| Executive Vice President | ||||||||
| Robert E, Dose | 15,000 | 31,350 | ||||||
| Vice President Finance | ||||||||
| Lori L. Swafford | 15,000 | 31,350 | ||||||
| Vice President Legal Affairs | ||||||||
| Larry O. Wonder | 15,000 | 31,350 | ||||||
| Vice President Sales | ||||||||
| (1) | The Value Realized on Vesting of RSUs is calculated by multiplying the number of shares that would vest upon a change-in-control by the difference between the closing market price of $2.10 per share on the last business day of fiscal 2008 less the $0.01 par value of the share of Common Stock that is paid by the Named Executive Officer. |
DIRECTOR COMPENSATION
Directors who are also officers of the Company receive no additional compensation for their services as directors. The Company’s non-employee directors receive an annual retainer of $62,500 composed of (i) $37,500 in the form of quarterly cash payments and (ii) $25,000 in the form of a restricted stock grant, granted each year on the date of the Annual Meeting of Stockholders. In addition, each non-employee director who serves as a lead director or as the Chair or member of a Board committee also receives an additional annual retainer for his or her services. The lead director receives $20,000 in cash per year. The Audit Committee Chair receives $7,500 per year, and Audit Committee members receive $4,500 per year. Chairs of the Compensation Committee and the Corporate Governance/ Nominating Committee each receive an additional $5,000 and the members of these committees each receive $3,000 per year. Directors are also reimbursed for travel and related expenses incurred to attend meetings. The Company has also established a pension plan for non-employee directors who have served as such for at least 10 years, providing for a series of quarterly payments (equal to the portion paid to the non-employee directors’ annual service fee) for such director’s lifetime following the date on which such director ceases to be a director for any reason other than death. Effective December 31, 2003, the Company froze all future benefit accruals under the pension plan.
15
The Company’s Guidelines with regard to Common Stock ownership by directors is for each director to own Common Stock with a market value of three times or more the annual cash retainer.
| Change | ||||||||||||||||||||||||||||
| Fees | Non-Equity | in | ||||||||||||||||||||||||||
| Paid in | Stock | Option | Incentive Plan | Pension | All Other | |||||||||||||||||||||||
| Cash | Awards | Awards | Compensation | Value | Compensation | Total | ||||||||||||||||||||||
| Name | ($) (1) | ($) (2) | ($) | ($) | ($) (3) | ($) (4) | ($) | |||||||||||||||||||||
| Donald S. Friesz | 45,000 | 20,833 | — | — | — | 39,720 | 105,553 | |||||||||||||||||||||
| Thomas J. Schulte | 48,000 | 20,833 | — | — | — | — | 68,833 | |||||||||||||||||||||
| Robert K. Montgomery | 45,500 | 20,833 | — | — | — | — | 66,333 | |||||||||||||||||||||
| Albert J. Moyer | 70,000 | 20,833 | — | — | — | — | 90,833 | |||||||||||||||||||||
| Glen D. Parish | 39,000 | 20,833 | — | — | — | 64,491 | 124,324 | |||||||||||||||||||||
| Donald A. Patrick | 48,000 | 20,833 | — | — | — | — | 68,833 | |||||||||||||||||||||
| Dr James R. Wilburn | 43,500 | 20,833 | — | — | — | — | 64,333 | |||||||||||||||||||||
| (1) | Cash Fees include the cash portion of the annual retainer plus fees for serving as a lead director, committee chair, or committee member. | |
| (2) | A grant of restricted stock with a market value of $25,000 on the grant date is awarded each year on the day of the Annual Meeting of Stockholders. The cost of these RSUs are described in Footnote # 5 of the Company’s Form 10K. | |
| (3) | The Pension Plans that Directors participate in was frozen in 2003. The Directors did not accrue any additional benefits during fiscal 2008. The Change in Pension amount includes the effect of a change in discount rate from 6.00% in fiscal 2007 to 6.75% in fiscal 2008, and the decrease in the discount period. Due to the change in discount rates, the change in pension value for Donald S. Friesz decreased by $9,094, the change in pension value for Robert K. Montgomery decreased by $15,759, the change in pension value for Donald A. Patrick decreased by $7,076, and the change in pension value for James R. Wilburn decreased by $10,271. | |
| (4) | Messrs. Friesz and Parish are former officers of the Company. Other compensation consists of pension benefits earned as an employee of the Company and paid in retirement. |
Securities Authorized for Issuance Under Equity Compensation Plans
| Equity Compensation Plan Information | ||||||||||||
| Number of securities | ||||||||||||
| Number of | remaining available | |||||||||||
| securities to be | for future issuance | |||||||||||
| issued upon | Weighted-average | under equity | ||||||||||
| exercise of | exercise price of | compensation plans | ||||||||||
| outstanding | outstanding options | -excluding | ||||||||||
| opinions, warrants | warrants and | securities reflected | ||||||||||
| Plan category | and rights (a) | rights (b) | in column (a) ( c ) | |||||||||
| Equity compensation plans approved by security holders | 103,000 | $ | 10.8 | 688,969(1 | ) | |||||||
| Equity compensation plans not approved by security holders | — | — | — | |||||||||
| Total | 103,000 | $ | 10.8 | $ | 688,969(1 | ) | ||||||
| (1) | Represents the number of shares available for issuance as of January 31, 2009 under the Company’s 2007 Stock Incentive Plan. |
16
CODE OF ETHICS
The Company has adopted a “Code of Ethics,” which is applicable to its chief executive officer and senior financial officers, including the principal accounting officer. The “Code of Ethics” is available on Virco’sthe Company’s website at www.virco.com. The Company intends to post amendments to or waivers under the Code of Ethics at this location on its website. Upon written request, the Company will provide a copy of the Code of Ethics free of charge. Requests should be directed to Virco Mfg. Corporation.,Corporation, 2027 Harpers Way, Torrance, California 90501, Attention: Robert E. Dose, Secretary.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Audit Committee, among its other duties and responsibilities, reviews and monitors all related party transactions and adopted the Company’s “Related Party Transaction Policies and Procedures” (the “Policy”). The Board of Directors has delegated to the Chair of the Audit Committee the authority to pre-approve or ratify (as applicable) any transaction with a related party in which the aggregate amount involved is expected to be less than $250,000. The Chair of the Audit Committee is required to provide to the Board of Directors for review a summary of each new transaction pre-approved by the Chair of the Audit Committee pursuant to this policy at the meeting of the Board of Directors next following such approval or ratification. Under the Policy, the Audit Committee is responsible for reviewing and approving transactions with a related party in which the aggregate amount is expected to exceed $250,000, and both the Audit Committee and the Board of Directors are responsible for reviewing and approving transactions with a related party in which the aggregate amount is expected to equal or exceed $500,000. If advance Audit Committee and/or Board of Directors approval is not feasible, then the transaction with the related party will be considered and, if the Audit Committee and/or Board of Directors determines it to be appropriate, ratified at the next regularly scheduled meeting. In determining whether to approve the entry into a transaction with a related party, the Audit Committee and/or Board of Directors as applicable will assess, among other factors it deems appropriate, whether the transaction is on terms no more favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related party’s interest in the transaction. If a transaction with a related party will be ongoing, the Audit Committee and/or Board of Directors may establish guidelines for the Company’s management to follow in its dealings with such related party. Thereafter, the Audit Committee and/or Board of Directors as applicable, on at least an annual basis, will review and asses the relationship with the related party to determine whether the relationship is in compliance with the Policy and remains appropriate. No director shall participate in any discussion or approval of a transaction for which he or she is a related party, except that this director shall provide all material information concerning the transaction to the Audit Committee and/or Board of Directors as applicable.
Robert K. Montgomery served in 2005fiscal 2008 as a member of the Board of Directors of the Company as a Class III Director.Company. Mr. Montgomery is a partnersenior counsel of the law firm Gibson, Dunn & Crutcher LLP, which has provided legal services to the Company. The Company expects that such law firm will continue to render legal services to the Company.
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REPORT OF THE AUDIT COMMITTEE
The Board of Directors has adopted a written charter for the Audit Committee, which is available on the Company’s website at www.virco.com. The Audit Committee reviews the Company’s financial reporting process on behalf of the Board of Directors. Management has the primary responsibility for the financial statements and the reporting process. The Company’s independent auditors are responsible for expressing an opinion on the conformity of ourthe Company’s audited financial statements with accounting principles generally accepted in the United States.
In this context, the Audit Committee has reviewed and discussed the audited financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009, with management and the independent auditors, including their judgment of the quality and appropriateness of accounting principles, the reasonableness of significant judgments and the clarity of the
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disclosures in the financial statements. In addition, the Audit Committee has discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (Communication with Audit Committees), SEC rules, and other applicable standards. In addition, the Audit Committee has received from the independent auditors the written disclosures pursuant toand letter required by the Independence Standardsapplicable requirements of the Public Company Accounting Oversight Board Standard No. 1 (Independence Discussionsregarding the independent auditor’s communication with the Audit Committees)Committee concerning independence, and has discussed with them their independence from the Company and its management.independent auditors the independent auditors’ independence. The Audit Committee has also considered whether the independent auditorsauditors’ provision of non-audit services to the Company is compatible with the auditor’sauditors’ independence. The Audit Committee also reviewed and discussed with management its report on internal control over financial reporting and the related audit performed by the independent auditors which confirmed the effectiveness of the Company’s internal control over financial reporting.
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board has approved, that the audited financial statements be incorporated by reference in the Company’s Annual Report on SECForm 10-K for the fiscal year ended January 31, 2006,2009, for filing with the Securities and Exchange Commission.
THE AUDIT COMMITTEE OF
THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS
Donald S. Friesz
Albert J. Moyer
Donald A. Patrick
The report of the Audit Committee of the Board of Directors shall not be deemed incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933 or under the Securities Exchange Act, of 1934, except to the extent that the Company specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.
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| 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | |||||||||||||||||||||||||
VIRCO MFG. CORPORATION | 100.00 | 102.36 | 108.96 | 90.44 | 96.60 | 81.71 | ||||||||||||||||||||||||
PEER GROUP | 100.00 | 125.29 | 99.92 | 148.97 | 160.63 | 167.31 | ||||||||||||||||||||||||
AMEX MARKET INDEX | 100.00 | 87.94 | 86.64 | 121.62 | 130.30 | 158.05 | ||||||||||||||||||||||||
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RELATIONSHIP WITH INDEPENDENT AUDITORS
Ernst & Young LLP wasaudited the Company’s financial statements for fiscal 2008 and has been selected by the Audit Committee ofto audit the Board of Directors to examine the accounts of the CompanyCompany’s financial statements for fiscal year 2005.2009. The Audit Committee is directly responsible for the engagement of the outside auditor. In making its determination, the Audit Committee reviewed both the audit scope and estimated audit fees for the coming year. Each professional service performed by Ernst & Young LLP during the fiscal year ended January 31, 2006,2008 was reviewed, and the possible effect of such service on the independence of the firm was considered, by the Audit Committee. Representatives of Ernst & Young LLP will be present at the Annual Meeting and will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions.
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The Audit Committee has adopted policies and procedures for pre-approving all audit services, audit-related services, tax services and non-audit services performed by Ernst & Young LLP. Specifically, the Audit Committee has pre-approved the use of Ernst & Young LLP for detailed, specific types of services within the following categories: annual audits, quarterly reviews and statutory audits, preparation of certain corporate tax returns, regulatory implementation and compliance and risk assessment guidance. In each case, the Audit Committee has also set specific annual ranges or limits on the amount of each category of services which the Company would obtain from Ernst & Young LLP, which limits and amounts are established periodically by the Audit Committee. Any proposed services exceeding these levels or amounts require specific pre-approval by the Audit Committee. The Audit Committee monitors the performance of all services provided by the independent auditor, to determine whether such services are in compliance with the Company’s pre-approval policies and procedures.
Fees Paid to Ernst & Young LLP
The following table shows the fees that the Company paid or accrued for the audit and other services provided by Ernst & Young LLP for fiscal years 20052008 and 2004.2007. All of the services described in the following fee table were approved in conformity with the Audit Committee’s pre-approval process.
| 2008 | 2007 | |||||||
| Audit Fees | $ | 476,125 | $ | 555,000 | ||||
| Audit -Related Fees | 47,000 | 47,000 | ||||||
| Tax Fees | — | 43,745 | ||||||
| All Other Fees | — | — | ||||||
| Total | $ | 523,125 | $ | 645,745 | ||||
| 2005 | 2004 | |||||||
| Audit Fees | $ | 570,400 | $ | 609,000 | ||||
| Audit-Related Fees | 39,000 | 34,500 | ||||||
| Tax Fees | 48,620 | 45,250 | ||||||
| All Other Fees | — | — | ||||||
| Total | $ | 658,020 | $ | 688,750 | ||||
Audit Fees.Audit fees are the aggregate fees for services of the outside auditor for audits of ourthe Company’s annual financial statements, the audit of management’s assessment of internal control over financial reporting and the independent registered accounting firm’s own audit of our internal control over financial reporting, including testing and compliance with Section 404 of the Sarbanes-Oxley Act of 2002, and review of ourthe Company’s quarterly financial statements included in ourthe Company’s Forms 10-Q, and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements for those fiscal years.
Audit-Related Fees.Audit-related fees are those fees for services provided by the outside auditor that are reasonably related to the performance of the audit or review of ourthe Company’s financial statements and not included as audit fees. The services for the fees disclosed under this category include the audit of Virco’sthe Company’s 401(k) and Qualified Pension Plans.
Tax Fees.Tax fees are those fees for services provided by the outside auditor, primarily in connection with the Company’s tax compliance activities, including technical tax advice related to the preparation of tax returns.
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PROPOSAL 2
The Company’s Audit Committee has selected Ernst & Young LLP, independent auditors, to audit its financial statements for the fiscal year ending January 31, 2007,2010, and recommends that the stockholders vote for ratification of that appointment. The Company’s Audit Committee has reviewed the professional services provided by Ernst & Young LLP, as described above, has considered the possible effect of such services on the independence of the firm, and has determined that such services have not affected Ernst & Young LLP’s independence. Notwithstanding this selection, the Audit Committee, inat its discretion, may direct the appointment of new auditors at any time during the fiscal year if the Audit Committee feelsdetermines that such a change would be in the best interests of the Company and its stockholders. If there is a negative vote on ratification, the Audit Committee will reconsider its selection.
The affirmative vote of a majority of the votes cast is required to ratify the Audit Committee’s selection. In addition, the affirmative votes must represent at least a majority of the required quorum. If the stockholders reject the selection, the Board of Directors will reconsider its selection.The Board of Directors unanimously recommends a vote “FOR” the ratification of the appointment of Ernst & Young LLP.
Other Matters
Section 16(a)16 (a) Beneficial Ownership Reporting Compliance.Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s officers, directors and persons who beneficially own more than 10% of any equity security of the Company to file reports of beneficial ownership and changes in beneficial ownership with the Securities and Exchange Commission and to furnish copies of these reports to the Company. Based solely on a review of the copies of the forms that the Company received, and other information available to it, to the best of the Company’s knowledge the following officers each filed one late report, reporting one transaction each: Robert Dose, Bassey Yau, Patricia Quinones, D. Randal Smith, Lori Swafford and Larry Wonder.all such reports were timely filed.
The Company’s bylaws also establish an advance notice procedure with regard to nominations of persons for election to the Board of Directors and proposals for other business that are not submitted for inclusion in the Proxy Statement and form of proxy but that a stockholder instead wishes to present directly at an Annual Meeting of Stockholders. If a stockholder wishes to submit a proposalnominee or other business for consideration at the 20072010 Annual Meeting of the Stockholders without including that nominee or proposal in the Company’s proxy statementProxy Statement and form of proxy, the Company’s bylaws require, among other things, that the stockholder tosubmission contain certain information concerning the nominee or other business, as the case may be, and other information specified in the Company’s bylaws, and that the stockholder provide the Company with written notice of such nominee or business no later than February 16, 2010 provided that, if the 2010 Annual Meeting of Stockholders is advanced or delayed more than 40 days from the anniversary date, such nominee or proposal of other business must be submitted no lesslater than 120 days in advancethe close of such meetingbusiness on the later of the 120th day prior to the 2010 Annual Meeting of Stockholders or if later, the tenth10th day following the first public announcement of the date of such meeting. Suchmeeting If the number of directors to be elected to the Board of Directors is increased and there is no public announcement specifying the size of increase before February 16, 2010, then a stockholder notice will be considered timely only with respect to nominees for new positions created by such increase if submitted not later than the close of business on the 10th day following the first public announcement of such increase. A stockholder notice should be sent to Virco’sthe Company’s Corporate Secretary at 2027 Harpers Way, Torrance, California 90501.90501, Attention: Robert E. Dose. Proposals or nominations not meeting the advance notice requirements in the Company’s bylaws will not be entertained at the 2010 Annual Meeting of Stockholders. A copy of the full text of the relevant bylaw provisions may be obtained from the Company’s filing with the SEC or by writing our Corporate Secretary at the address identified above.
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Additional Matters Considered at the Annual Meeting.The Board of Directors does not know of any matters to be presented at the 2006 Annual Meeting other than as stated herein. If other matters do properly come before the Annual Meeting, the persons named on the accompanying proxy card will vote the proxies in accordance with their judgment in such matters.
Availability of Annual Report.The Annual Report to the Stockholders of the Company for the fiscal year ended January 31, 20062009, is being mailed to stockholders concurrently herewith and is also available online at http://www.virco.com. The Company will deliver only one Proxy Statement and accompanying Annual Report to multiple stockholders sharing an address unless the Company has received contrary instructions from one or more of the stockholders. The Company will undertake to deliver promptly, upon written or oral request, a separate copy of the Proxy Statement and accompanying Annual Report to a stockholder at a shared address to which a single copy of such documents are delivered. A stockholder can notify the Company that the stockholder wishes to receive a separate copy of the Proxy Statement and/or Annual Report by contacting the Company’s Corporate Secretary at 2027 Harpers Way, Torrance, California 90501 or at (310) 553-0474. Similarly, stockholders sharing an address who are receiving multiple copies of the Proxy Statement and accompanying Annual Report may request delivery of a single copy of the Proxy Statement and/or Annual Report by contacting the Company at the address set forth above or at (310) 533-0474.
The Company will also provide without charge a copy of its Annual Report onForm 10-K, including financial statements and related schedules, filed with the Securities and Exchange Commission, upon written or oral request from any person who was holder of record, or who represents in good faith that he/she was a beneficial owner, of Common Stock of the Company on April 21, 2006.24, 2009. Any such request shall be addressed to the Company at 2027 Harpers Way, Torrance, California 90501, Attention: CorporateRobert E. Dose, Secretary or by calling(310) 533-0474.
By Order of the Board of Directors
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A-1
A-2
A-3
| Secretary |
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your votes as indicated in this example | ||||
| FOR | WITHHOLD | *EXCEPTIONS | |||||||
| ALL | FOR ALL | ||||||||
| 1. | ELECTION OF DIRECTORS: | ||||||||
| Nominees: | c | c | c | ||||||
| 01 Robert A. Virtue | |||||||||
| 02 Robert K. Montgomery | |||||||||
| 03 Donald A. Patrick | |||||||||
(INSTRUCTIONS: To specify different instructions with regard to cumulative voting or to withhold authority to vote for any individual nominee, mark the “Exceptions” box above and write your instructions in the space provided below.)
*Exceptions
FOR | AGAINST | ABSTAIN | ||||||
| 2. | Ratification of |
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL BE VOTED “FOR” THE ELECTION OF ALL OF THE NOMINEES TO THE BOARD OF DIRECTORS, “FOR” PROPOSAL 2, AND “FOR” ANY OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING IN THE DISCRETION OF THE HOLDERS OF THE PROXY.
Mark Here for Address Change or Comments SEE REVERSE | c |
Signature | Signature | Date | ||||||||
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such.
| 5 | FOLD AND DETACH HERE | 5 |
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.
Internet and Telephone and Internet voting isare available through 11:59 PM EST Eastern Time
the day
prior toannual meetingthe Annual Meeting day.
prior to
VIRCO MFG. CORPORATION
Important notice regarding the Internet availability of proxy materials for the Annual Meeting of stockholders
The Proxy Statement and the 2008 Annual Report to Stockholders are available at:
http://www.virco.com
INTERNET
http://www.proxyvoting.com/virc
http://www.proxyvoting.com/virc
Use the Internet to vote your proxy. Have your proxy card in hand when you access the web site.
OR
TELEPHONE 1-866-540-5760
Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call.
OR
MAIL
Mark, sign and date your proxy card and return it in the enclosed postage-paid envelope.
If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
Your telephoneInternet or Internettelephone vote authorizes the named proxies to vote your shares in the same manner
as if you marked, signed and returned your proxy card.
as if you marked, signed and returned your proxy card.
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF
VIRCO MFG. CORPORATION
Annual Meeting of Stockholders – June 16, 2009
VIRCO MFG. CORPORATION
Annual Meeting of Stockholders – June 16, 2009
The undersigned hereby appoints each of Robert A. Virtue, Douglas A. Virtue and Robert E. Dose, or either of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the shares of Common Stock of Virco Mfg. Corporation (the “Company”) which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come before the 2009 Annual Meeting of Stockholders (the “Annual Meeting”) of the Company to be held June 16, 2009 or at any adjournment or postponement thereof, with all powers which the undersigned would possess if present at the Annual Meeting.
Address Change/Comments (Mark the corresponding box on the reverse side) |
BNY MELLON SHAREOWNER SERVICES
P.O. BOX 3550
SOUTH HACKENSACK, NJ 07606-9250
P.O. BOX 3550
SOUTH HACKENSACK, NJ 07606-9250
(Continued and to be marked, dated and signed, on the other side)
| 5 | FOLD AND DETACH HERE | 5 |
You can now access your VIRCO MFG. CORPORATION account online.
Access your Virco Mfg. Corporation stockholder account online via Investor ServiceDirect®(ISD).
The transfer agent for Virco Mfg. Corporation now makes it easy and convenient to get current information on your shareholder account.
• View account status | • View payment history for dividends | |||||||
• View certificate history | • Make address changes | |||||||
• View book-entry information | • Obtain a duplicate 1099 tax form | |||||||
• |
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www.bnymellon.com/shareowner/isd
Investor ServiceDirect®
Available 24 hours per day, 7 days per week
Investor ServiceDirect®
Available 24 hours per day, 7 days per week
ChooseMLinkSM for fast, easy and Proxy Statementsecure 24/7 online access to your future proxy materials, investment plan statements, tax documents and more. Simply log on the internet at: http://www.virco.com/Pages/set1a.htmtoInvestor ServiceDirect®atwww.bnymellon.com/shareowner/isd where step-by-step instructions will prompt you through enrollment.
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