CUMBERLAND TECHNOLOGIES, INC.
4311 West Waters Avenue, Suite 401
Tampa, Florida 33614
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------------------
TO THE SHAREHOLDERS OF CUMBERLAND TECHNOLOGIES, INC.:
----------------------------------------------------
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of
CUMBERLAND TECHNOLOGIES, INC. (the "Company") will be held at the office of
Cumberland Technologies, Inc., 4311 West Waters Avenue, Suite 401, Tampa,
Florida 33614 on October 22, 2001 at 9:00 a.m., Tampa time, for the following
purposes:
1. To elect three directors to serve until the next annual meeting of
shareholders and until their successors are elected and have
qualified.
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The proxy statement dated September 17, 2001 is attached.
Only record holders of the Company's $.001 par value Common Stock at the
close of business on September 17, 2001 will be eligible to vote at the meeting.
Your attendance at the annual meeting is very much desired. However, if
there is any chance you may not be able to attend the meeting, please execute,
complete, date and return the proxy in the enclosed envelope. If you attend the
meeting, you may revoke the proxy and vote in person.
By Order of the Board of Directors:
/s/: CAROL S. BLACK
-----------------------------------
Carol S. Black, Secretary
Date: September 17, 2001
A copy of the Annual Report on Form 10-K of Cumberland Technologies, Inc.
for the fiscal year ended December 31, 2000 containing financial statements is
enclosed.
CUMBERLAND TECHNOLOGIES, INC.
4311 West Waters Avenue, Suite 401
Tampa, Florida 33614
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
--------------------------------------------------
This statement is furnished for the solicitation by the Board of Directors
of proxies for the annual meeting of shareholders of Cumberland Technologies,
Inc. ("Cumberland," or the "Company") to be held on October 22, 2001, at 9:00
a.m., Tampa time, at the office of Cumberland Technologies, Inc., 4311 West
Waters Avenue, Suite 401, Tampa, Florida 33614. The sending in of a signed proxy
will not affect the shareholder's right to attend the meeting and vote in
person. A signed proxy may be revoked by the sending in of a timely but later
dated, signed proxy. Any shareholder giving a proxy may also revoke it at any
time before it is exercised by giving oral or written notice to Carol S. Black,
Secretary of the Company, at the offices of the Company. Oral notice may be
delivered by telephone call to Ms. Black, at the offices of the Company, at
(813) 885-2112.
Holders of record of the Company's $.001 par value Common Stock at the
close of business on September 17, 2001, will be eligible to vote at the
meeting. The Company's stock transfer books will not be closed. At the close of
business on August 31, 2001, the Company had outstanding a total of 5,597,244
shares of $.001 par value common stock (excluding a total of 318,112 shares of
treasury stock held by the Company, which are not entitled to vote). Each such
share will be entitled to one vote (non-cumulative) at the meeting.
Other than the matters set forth herein, management is not aware of any
other matters that may come before the meeting. If any other business should
properly come before the meeting, the persons named in the enclosed proxy will
have discretionary authority to vote the shares represented by the effective
proxies and intend to vote them in accordance with their best judgment.
This proxy statement and the attached proxy were first mailed to security
holders on behalf of the Company on or about September 17, 2001. Properly
executed proxies, timely returned, will be voted and, where the person solicited
specifies by means of a ballot a choice with respect to any matter to be acted
upon at the meeting, the shares will be voted as indicated by the shareholder.
If the person solicited does not specify a choice with respect to election of
directors, the shares will be voted "FOR" the nominees identified below for
election as directors. In addition to the solicitation of proxies by the use of
the mails, directors and officers of the Company may solicit proxies on behalf
of the Board by telephone, telegram and personal interview. Such persons will
receive no additional compensation for their solicitation activities, and will
be reimbursed only for their actual expenses in connection therewith. The costs
of soliciting proxies will be borne by the Company.
VOTING PROCEDURES AND VOTE REQUIRED
-----------------------------------
The Secretary of Cumberland, in consultation with the judges of election,
who will be employees of the Company's transfer agent, shall determine the
eligibility of persons present at the Annual Meeting to vote and shall determine
whether the name signed on each proxy card corresponds to the name of a
shareholder of the Company. The Secretary, based on such consultation, shall
also determine whether or not a quorum of the shares of the Company (consisting
of a majority of the votes entitled to be cast at the Annual Meeting) exists at
the Annual Meeting. Both abstentions from voting and broker non-votes will be
counted for the purpose of determining the presence or absence of a quorum for
the transaction of business. If a quorum exists and a vote is taken at the
Annual Meeting, the Secretary of the Company, with the assistance of the judges
of election, shall tabulate (i) the votes cast for or against each proposal and
(ii) the abstentions in respect of each proposal.
Directors will be elected by a plurality of the votes cast by the holders
of shares entitled to vote in the election. Since there are three directorships
to be filled, this means that the three individuals receiving the most votes
will be elected. Abstentions and broker non-votes will therefore not be relevant
to the outcome.
The Company's Directors and Executive Officers beneficially own 76.7% of
the shares of Cumberland Common Stock and intend to vote such shares in favor of
the nominees named below. There are no rights of appraisal or similar rights
with respect to any matter to be acted upon pursuant to this proxy statement.
ELECTION OF DIRECTORS
---------------------
The proxy holders intend to vote "FOR" election of the nominees named below
(who are currently members of the Board) as directors of the Company, unless
otherwise specified in the proxy. Directors of the Company elected at the Annual
Meeting to be held on October 22, 2001 will hold office until the next Annual
Meeting or until their successors are elected and qualified.
Each of the nominees has consented to serve on the Board of Directors, if
elected. Should any nominee for the office of director become unable to accept
nomination or election, which is not anticipated, it is the intention of the
persons named in the proxy, unless otherwise specifically instructed in the
proxy, to vote for the election in his stead of such other person as the Board
may recommend.
The individuals listed below as nominees for the Board of Directors were
directors of the Company during 2000. The name and age of each nominee, his
principal occupation, and the period during which such person has served as a
director is set forth below:
Shares of Percent of
Cumberland Stock Outstanding
Beneficially Shares of
Owned at July 31, Cumberland
Name of Nominee Service as Director Age 2001(1) Stock
------------------- ------------------- --- ----------------- ----------
Francis M. Williams since 1991 59 3,852,295 (2) 68.8%
Andrew J. Cohen (4) since 1997 47 47,590 (3) *
R. Donald Finn (4) since 1999 57 7,131 (5) *
----------------
*Ownership represents less than 1% of outstanding shares of Cumberland
Common Stock.
(1) Except as otherwise noted, the nature of the beneficial ownership for all
shares is sole or shared voting and investment power.
(2) Includes 2,505,487 shares owned by Mr. Francis Williams; 1,149,635 shares
allocated to Mr. Williams based on his 66.7% ownership in Kimmins Corp.
("KC"), 29,346 shares owned by Mr. Williams' wife; 14,777 shares held by
Mr. Williams as trustee for his wife and children and 153,050 held by
various real estate partnerships of which Mr. Williams is 100 percent
owner. Mr. Williams owns 66.7% of the outstanding common stock of Kimmins
Corp. and is its Chairman and Chief Executive Officer.
(3) Includes 50% of the 72,540 shares owned by C&C Properties a partnership in
which Mr. Cohen has a 50% ownership, 6,320 shares held in trust for Mr.
Cohen's minor children and options to purchase 5,000 shares of Cumberland
Technologies, Inc. common stock.
(4) Member of the Audit Committee.
(5) Includes 2,131 shares owned by Mr. R. Donald Finn and options to purchase
5,000 shares of Cumberland Technologies, Inc., common stock.
Francis M. Williams has been Chairman of the Board of Cumberland since its
inception and, until June 1992, was President of Cumberland. Mr. Williams is the
uncle of Mr. Joseph M. Williams, President of Cumberland. In addition, Mr.
Williams has been Chairman of the Board and Director of CCS and SSI from
inception and President and Chairman of the Board of KC since its inception in
1979. Prior to November 1988, Mr. Williams was the Chairman of the Board and
Chief Executive Officer of Kimmins Corp. and its predecessors and sole owner of
K Management Corp. From June 1981 until January 1988, Mr. Williams was the
Chairman of the Board of Directors of College Venture Equity Corp., a small
business investment company; and since June 1981, he has been Chairman of the
Board, Director, and sole stockholder of Kimmins Coffee Service, Inc., an office
coffee service company. Mr. Williams has also been a director of the National
Association of Demolition Contractors and a member of the executive committee of
the Tampa Bay International Trade Council.
Andrew J. Cohen was elected as a Director to Cumberland's Board effective
February 24, 1997. Currently Co-President and Chief Executive Officer of ABC
Capital Corp., an investment management firm based in Tampa, Florida and also
acts as Co-Chairman on their Board of Directors. In addition, Mr. Cohen is
President of Albany Associates, Inc., a Tampa based management consulting firm.
Since June of 1972, Mr. Cohen has been co-President of ABC Fabric of Tampa, Inc.
which is now the fourth largest private retail fabric company in the United
States. Mr. Cohen brings both national marketing and corporate management
experiences to Cumberland.
R. Donald Finn was elected as a Director to Cumberland's Board effective
September 9, 1999. For more than the last five years, Mr. Finn has been a
partner in the law firm of Gibson, McAskill & Crosby, located in Buffalo, New
York, where Mr. Finn has practiced law for more than the last 25 years.
INFORMATION ABOUT THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
--------------------------------------------------------------------
Meetings of the Board of Directors. During 2000, there was one meeting of
the Board of Directors.
Director Compensation. During the year ended December 31, 2000, the Company
paid all non-employee directors an annual fee of $5,000. In addition, directors
are reimbursed for expenses incurred in connection with their services as a
director.
CTI has 400,000 shares of its common stock reserved for issuance for the
exercise of options to be granted under its stock option plan (the "Plan").
Options granted under the Plan, in general, expire no later than ten years from
the date of grant. The directors are eligible to receive stock options at the
discretion of the board.
Audit Committee. The Company's Audit Committee consists of Mr. Francis M.
Williams, Chairman of the Board and two non-employee directors: Mr. Cohen and
Mr. Finn. The Audit Committee met once during 2000. The function of the Audit
Committee is to review the general scope of the Company's annual audit and the
nature of services to be performed for the Company in connection therewith,
acting as liaison between the Board of Directors and the independent auditors.
Compensation Advisory Committee. Cumberland does not have a standing
compensation committee of the Board of Directors.
Nominating Committee. Cumberland does not have a standing nominating
committee of the Board of Directors.
During 2000, no director attended fewer than 75% of the aggregate of the
total number of meetings of the Board of Directors and the total number of
meetings held by all committees of the Board on which he served.
REPORT OF THE AUDIT COMMITTEE
-----------------------------
The following Report of the Audit Committee shall not be deemed to be
"soliciting material" or be "filed" with the Securities and Exchange Commission
("the Commission") or subject to Regulations 14A or 14C of the Commission or to
the liabilities of Section 18 of the Securities and Exchange Act of 1934 (the
"Exchange Act") and shall not be deemed incorporated by reference into any
filing under the Securities Act of 1933 or the Exchange Act, notwithstanding any
general incorporated by reference of this Proxy Statement into any other
document.
The Board of Directors maintain an Audit Committee comprised of three
members of which two represent the Company's outside directors. The Board of
Directors and the Audit Committee believes that the Audit Committee's current
member composition satisfies the rule of the National Association of Securities
Dealers, Inc. ("NASD") that governs audit committee composition as currently in
effect, including the requirement that audit committee members all be
"independent directors" as that term is defined by NASD Rule 4200(a)(14). All of
the Audit Committee members are independent except for Mr. Williams. Mr.
Williams is not independent because he is an officer, director and a controlling
shareholder of Kimmins Corp., an affiliate of Cumberland. The Board has
determined that Mr. Williams membership on the Audit Committee is in the best
interest of the Company. In addition, the Company qualifies as a "small business
issuer" under SEC Regulation S-B and therefore, is only required to have two
independent directors on its Audit Committee. The Board has adopted a written
Charter of the Audit Committee, a copy of which is attached as Appendix A
hereto.
The Audit Committee oversees the Company's financial process on behalf of
the Board of Directors. Management has the primary responsibility for the
financial statements and the reporting process including the systems of internal
controls. The independent auditors are responsible for expressing an opinion on
the conformity of the financial statements with accounting principles generally
accepted in the United States of America. In fulfilling its oversight
responsibilities, the Audit Committee reviewed the audited financial statements
in the Annual Report on Form 10-K for the year ended December 31, 2000 with
management. The Audit Committee considered the compatibility of the non-audit
services the Company received from its independent auditors and the effect of
such engagements on the independence of the independent auditors. The Audit
Committee had previously met with management to discuss the interim financial
statements of the Company for each applicable reporting period prior to the
filing or distribution of such financial statements.
The members of the Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not experts in the fields of
accounting or auditing, including in respect of auditor independence. Members of
the Committee rely without independent verification on the information provided
to them and on the representations made by management and the independent
accountants. Accordingly, the Audit Committee's oversight does not provide an
independent basis to determine that management has maintained appropriate
accounting and financial reporting principals or appropriate internal control
and procedures designed to assure compliance with accounting standards and
applicable laws and regulations. Furthermore, the Audit Committee's
considerations and discussions referred to above do not assure that the audit of
the Company's financial statements has been carried out in accordance with
generally accepted auditing standards, that the financial statements are
presented in accordance with generally accepted accounting principles or that
the Company's auditors are in fact "independent."
In reliance on the reviews and discussion referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2000 for filing with Securities and Exchange
Commission.
Audit Committee
By: /s/ Francis M. Williams
---------------------------------
Francis M. Williams
By: /s/ Andrew J. Cohen
---------------------------------
Andrew J. Cohen
By: /s/ R. Donald Finn
---------------------------------
R. Donald Finn
The Company incurred the following fees for services performed by Deloitte
& Touche LLP in 2000:
Audit Fees
----------
Fees for the year 2000 audit and the review of Forms 10-Q in 2000 were
$98,180.
Financial Information Systems Design and Implementation Fee
-----------------------------------------------------------
Deloitte & Touche LLP did not render any services related to financial
information systems design and implementation for the year ended December 31,
2000.
All Other Fees
--------------
Aggregate fees billed for all other services rendered by Deloitte & Touche
LLP for the year ended December 31, 2000 were $21,500.
Notwithstanding anything to the contrary set forth in any of the Company's
filings under the Securities Act of 1933, as amended, or the Securities Exchange
Act of 1934, as amended, that might incorporate other Company filings, including
this proxy statement, in whole or in part, the following Report and Performance
Graph shall not be incorporated by reference into any such filings.
REPORT OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
----------------------------------------------------------
There is no formal compensation committee of the Board of Directors or
other committee of the Board performing equivalent functions. Compensation is
determined by Francis M. Williams, Chairman of the Board of the Company under
the direction of the Board of Directors. There is no formal compensation policy
for the Chief Executive Officer of the Company. Compensation of the Chief
Executive Officer, which primarily consists of salary, is based generally on
performance and the Company's resources. Compensation for Mr. Joseph Williams
has been fixed annually each year by the Chairman of the Board. Mr. Joseph
Williams' compensation is not subject to any employment contract.
In general, following initial employment, the granting of stock-based
incentives is considered by the Company to be justified when the Company's
revenues and earnings, coupled with the individual executive's performance,
warrant supplemental compensation in addition to the salary and bonus paid with
respect to a given year. The Board thinks it unlikely that any participants in
the Company's stock plans will, in the foreseeable future, receive in excess of
$1 Million in aggregate compensation (the maximum amount for which an employer
may claim a compensation deduction pursuant to Section 162(m) of the Internal
Revenue Code of 1986, as amended, unless certain performance-related
compensation exemptions are met) during any fiscal year, and has therefore
determined that the Company will not take any affirmative action at this time to
meet the requirements of such exemptions.
By: /s/ Francis M. Williams
------------------------------------------
Francis M. Williams, Chairman of the Board
By: /s/ Andrew J. Cohen
------------------------------------------
Andrew J. Cohen, Director
By: /s/ R. Donald Finn
------------------------------------------
R. Donald Finn, Director
PERFORMANCE GRAPH
-----------------
Set forth below is a line-graph presentation comparing the cumulative
shareholder return on the Company's Common Stock, on an indexed basis, against
cumulative total returns of the Nasdaq Stock Market and of companies listed on
the Nasdaq Stock Market in Securities Industrial Code (SIC Code 6351) in the
surety industry. The returns for the peer group were weighted according to each
issuer's market capitalization. The Company's Common Stock (symbol "CUMB") had
been traded in the over-the-counter market since October 1, 1992. Effective
December 16, 1996, Cumberland was approved and included in the trading on the
Nasdaq SmallCap Market. The Performance Graph shows total return on investment
for the period beginning December 31, 1995 and ending December 31, 2000. Total
return assumes reinvestment of dividends.
THE CURRENT COMPOSITION OF THE SURETY INDUSTRY CODE IS AS FOLLOWS:
------------------------------------------------------------------
ACMAT Corp. Cla Frontier Insurance Group Penn America Group
AMBAC Financial Group MBIA Inc. PMI Group Inc.
Amwest Insurance Group MGIC Investments Corp.
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
VALUE OF $100 INVESTED ON DECEMBER 31, 1995 AT:
------- -------- -------- -------- ------- ---------
12/95 12/96 12/97 12/98 12/99 12/00
------- -------- -------- -------- ------- ---------
CUMBERLAND ......... $100.00 $ 960.00 $ 880.00 $ 640.00 $480.00 $ 800.00
NASDAQ MARKET (U.S.) 100.00 123.03 150.68 212.45 394.80 237.43
PEER GROUP ......... 100.00 136.48 201.30 169.48 177.91 240.65
EXECUTIVE COMPENSATION
----------------------
The following table sets forth the compensation paid or accrued by the
Company to the Company's President and the President of Cumberland Casualty &
Surety Company ("CCS"). No other executive officer received compensation of
$100,000 or more in 2000. The information presented is for the years ended
December 31, 2000, 1999 and 1998.
SUMMARY COMPENSATION TABLE
Annual Compensation
-------------------------------------------------------
Other
Annual
Name of Individual and Principal Position Year Salary Bonus Compensation
----------------------------------------- -------------------------------------------------------
Joseph M. Williams, President and Treasurer: 2000 $ 95,000 $ 64,000 $ --
1999 $ 95,000 $ 60,000 $ --
1998 $ 95,000 $ 30,000 $ --
Edward J. Edenfield IV, President of CCS: 2000 $115,000 $ 50,500 $ 15,000
1999 $115,000 $ 35,000 $ --
1998 $116,731 $ 25,000 $ --
Grant of Options. During 2000, no options were granted to Mr. Williams. No
stock appreciation rights (SARs) have been granted by the Company.
Options Exercised. The following table sets forth information regarding the
number of options held by the Company's President and President of CCS including
the value of unexercised in-the-money options as of December 31, 2000. Mr.
Williams exercised 56,000 options in 2000. The closing price of the Company's
Common Stock on December 31, 2000 used to calculate the value of unexercised
options was $1.875 per share.
AGGREGATED OPTIONS/SAR EXERCISED IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTIONS/SAR VALUES
----------------------------------
Number of Value of
Securities Unexercised
Underlying In-the-Money
Unexercised Options at
Shares Options at Fiscal Fiscal Year End
Acquired Year End ($)(1)
Exercised Value (#) Exercisable/ Exercisable/
Name (#) Realized Unexercisable Unexercisable
---- --------- -------- --------------- ---------------
Joseph M. Williams 56,000 $105,000 44,000/0 $82,500/0
Edward J. Edenfield IV -- -- 22,000/0 $41,250/0
Option Repricing. The Company did not reprice any stock options in 1998,
1999 or 2000 and, to date, has not issued any stock appreciation rights.
Employment Agreements. The Company has not entered into employment
agreements with any of its executives.
Compensation Advisory Committee Interlocks and Insider Participation. There
is no compensation committee of the Company's Board of Directors or other
committee of the Board performing equivalent functions. The person who performs
the equivalent function is Francis M. Williams, Chairman of the Board. Francis
Williams serves as an executive officer and director of Kimmins Corp. of which
Joseph Williams is also an executive officer.
CERTAIN RELATIONSHIPS
---------------------
Surplus Debentures/Term Note. In 1988, CCS, a wholly-owned subsidiary of
the Company, issued a surplus debenture to KC in exchange for $3,000,000 which
bears interest at 10 percent per annum. In 1992, the debenture due to KC from
CCS was assigned to the Company. Interest and principal payments are subject to
approval by the Florida Department of Insurance. On April 1, 1997, the Company
forgave $375,000 of its $3,000,000 surplus debenture due from CCS. As a result,
CCS increased paid-in-capital by $375,000. On June 30, 1999, the Company forgave
$576,266 of its $2,625,000 surplus debenture due from CCS. As a result, CCS
increased paid-in-capital to $1,000,000 from $423,734. As of December 31, 2000,
no payments could be made under the terms of the debenture.
The Company entered into a term note agreement with KC for the outstanding
amount of the surplus debenture, including interest in arrears of ($4,291,049)
at September 30, 1992 as part of the Distribution. The term note was pari passi
with the other debts of CCS, had a 10 percent interest rate and was due on
October 1, 2002.
Effective October 1, 1996, the Company issued 1,723,290 shares at $3.00 per
share of its common stock to Kimmins Corp. (f/k/a Kimmins Environmental Services
Corp.) in exchange for surrender of the Company's term note payable in the
amount of $5,169,870.
Effective November 10, 1998 the Company entered into a $1,000,000
convertible term note agreement with TransCor Waste Services, Inc., a subsidiary
of KC. The note is due November 10, 2001 and bears interest at 10%. The lender
may convert the principal amount of the note or a portion thereof into common
stock at $3.00 per share subsequent to a six-month anniversary and prior to the
close of business on the maturity date.
CCS writes surety bonds for KC and its affiliates. Revenues attributable to
transactions with KC and its affiliates were $4,413, $10,342 and $14,907 for the
years ended December 31, 2000, 1999 and 1998, respectively. Qualex, a subsidiary
of the Company, performs consulting services for KC and affiliates. Revenue
attributable to transaction with affiliates were $171,292, $117,075 and $282,193
for years ended December 31, 2000, 1999 and 1998, respectively.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
-------------------------------------------------------
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10 percent of a registered
class of the Company's equity securities, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission (SEC).
Officers, directors, and greater than 10 percent stockholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file. Based solely on the Company's review of the copies of such forms
received by it, or written representations from certain reporting persons, the
Company believes that all filing requirements applicable were complied with
during fiscal 2000.
OWNERSHIP OF PRINCIPAL SHAREHOLDERS AND CERTAIN EXECUTIVE OFFICERS
------------------------------------------------------------------
The name and address of each person or entity who owned beneficially 5% or
more of the outstanding shares of Common Stock of Cumberland on July 31, 2001,
together with the number of shares owned and the percentage of outstanding
shares that ownership represents is set forth in the following table. The table
also shows information concerning beneficial ownership by the President of the
Company, the President of CCS, and by all directors and executive officers as a
group. The number of shares beneficially owned is determined under the rules of
the SEC, and the information is not necessarily indicative of beneficial
ownership for any other purpose. Under such rules, beneficial ownership includes
any shares as to which the individual has the sole or shared voting power or
investment power and also any shares which the individual has the right to
acquire within 60 days after the date hereof through the exercise of any stock
option or other right. Unless otherwise indicated, each person has sole
investment and voting powers (or shares such powers with his or her spouse) with
respect to the shares set forth in the following table:
Number of Percentage of
Shares of Outstanding
Cumberland Stock Shares of
Beneficially Cumberland
Beneficial Owner (1)(2) Owned Stock
------------------------- --------------- ------------
Francis M. Williams
c/o Kimmins Corp.
1501 2nd Avenue East
Tampa, Florida 33605 ............................ 3,852,295(3) 68.8%
Kimmins Corp.
1501 2nd Avenue East
Tampa, Florida 33605 ........................... 1,723,590 30.8%
Joseph M. Williams .............................. 358,993(4) 6.4%
Andrew J. Cohen ................................. 47,590(5) *
R. Donald Finn .................................. 7,131(6) *
Edward J. Edenfield IV .......................... 30,000(7) *
All current Directors and Executive
Officers as a group (5 persons) ................. 4,296,009 76.8%
----------
* Ownership represents less than 1% of outstanding Cumberland Common Stock.
(1) The address of all Officers and Directors of Cumberland listed above,
unless listed separately, are in care of Cumberland at 4311 West Waters
Avenue, Suite 401, Tampa, Florida 33614.
(2) Cumberland believes that the persons named in the table have sole voting
and investment power with respect to all shares of common stock
beneficially owned by them, unless otherwise noted.
(3) Includes 2,505,487 shares owned by Mr. Francis Williams; 1,149,635 shares
allocated to Mr. Williams based on his 66.7% ownership in Kimmins Corp.,
29,346 shares owned by Mr. Williams' wife; 14,777 shares held by Mr.
Williams as trustee for his wife and children and 153,050 held by various
real estate partnerships of which Mr. Williams is 100 percent Owner. Mr.
Williams owns 66.7% of the outstanding common stock of Kimmins Corp. and is
its Chairman and Chief Executive Officer.
(4) Includes 132,800 shares owned by Mr. Joseph M. Williams; 210 shares held by
Mr. Williams as trustee for his children; 219 shares held by the KC 401(k)
Plan and ESOP of which Mr. Williams is fully vested. Also includes 205,764
shares held by KC's 401(k) Plan, Profit Participation Plan and ESOP,
options to acquire 20,000 shares of the Company's Common Stock held by the
ESOP, of which Mr. Williams is a trustee; Mr. Williams disclaims beneficial
ownership of these shares.
(5) Includes 50% of the 72,540 shares owned by C&C Properties a partnership in
which Mr. Cohen has a 50% ownership and 6,320 shares held in trust for Mr.
Cohen's minor children; options to acquire 5,000 shares of Cumberland
common stock.
(6) Includes 2,131 shares owned by R. Donald Finn; options to acquire 5,000
shares of Cumberland common stock.
(7) Includes options to acquire 30,000 shares of Cumberland Common Stock.
INDEPENDENT PUBLIC ACCOUNTANTS
------------------------------
The accounting firm of Deloitte & Touche LLP has served as the independent
certified public accountants of the Company since 1999.
It is anticipated that a representative from the accounting firm of
Deloitte & Touche LLP will be present at the annual meeting of shareholders to
answer questions and make a statement if the representative desires to do so.
Ernst & Young LLP were the Company's independent auditors for the fiscal
years ending December 31, 1998 and 1997. The Board of Directors of the Company
dismissed Ernst & Young LLP as the Company's auditors on November 8, 1999. In
connection with the audits of the Company's financial statements for each of the
two fiscal years ended December 31, 1998 and 1997, there were no disagreements
with Ernst & Young LLP on any matters of accounting principles or practices,
financial statement disclosure, or auditing scope and procedure. Ernst & Young
LLP furnished the Company with a letter to the Commission stating that it agrees
with the above statements.
SHAREHOLDER PROPOSALS
---------------------
Appropriate proposals of shareholders intended to be presented at the
Company's 2001 annual meeting of shareholders must be received by the Company
May 16, 2002 for inclusion in its proxy statement and form of proxy relating to
that meeting. Appropriate proposals of shareholders intended to be presented at
the Company's 2002 annual meeting without inclusion in the proxy statement must
be received by the Company by July 30, 2002. If the date of the next annual
meeting is advanced or delayed by more than 30 calendar days from the date of
the annual meeting to which this proxy statement relates, the Company shall, in
a timely manner, inform its shareholders of the change, and the date by which
proposals of shareholders must be received.
UPON THE WRITTEN REQUEST OF ANY RECORD OR BENEFICIAL OWNER OF COMMON STOCK
OF THE COMPANY WHOSE PROXY WAS SOLICITED IN CONNECTION WITH THE 2001 ANNUAL
MEETING OF SHAREHOLDERS, THE COMPANY WILL FURNISH SUCH OWNER, WITHOUT CHARGE, A
COPY OF ITS ANNUAL REPORT ON FORM 10-K WITHOUT EXHIBITS FOR ITS FISCAL YEAR
ENDED DECEMBER 31, 2000. REQUEST FOR A COPY OF SUCH ANNUAL REPORT ON FORM 10-K
SHOULD BE ADDRESSED TO CAROL S. BLACK, SECRETARY, CUMBERLAND TECHNOLOGIES, INC.,
4311 WEST WATERS AVENUE, SUITE 401, TAMPA, FLORIDA 33614.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO SIGN, COMPLETE, DATE AND
RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE, TO WHICH NO POSTAGE NEED BE
AFFIXED.
Dated: September 17, 2001 By Order of the Board of Directors
By: /s/ CAROL S. BLACK
----------------------------------
Carol S. Black, Secretary
APPENDIX A
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AUDIT COMMITTEE CHARTER
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This Audit Committee Charter ("Charter") has been adopted by the Board of
Directors (the "Board") of Cumberland Technologies, Inc. (the "Company"). The
Audit Committee of the Board (the "Committee") shall review and reassess this
charter annually and recommend any proposed changes to the Board for approval.
Role and Independence
---------------------
Organization
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The Committee assists the Board in fulfilling its responsibility for
oversight of the quality and integrity of the accounting, auditing, internal
control and financial reporting practices of the Company. It may also have such
other duties as may from time to time be assigned to it by the Board. The
membership of the Committee shall consist of at least three directors, who are
each free of any relationship that, in the opinion of the Board, may interfere
with such member's individual exercise of independent judgment. Each Committee
member shall also meet the independence and financial literacy requirements for
serving on audit committees and at least one member shall have accounting or
related financial management expertise, all as set forth in the applicable rules
of the NASDAQ. The Committee shall maintain free and open communication with the
independent auditors and Company management. In discharging its oversight role,
the Committee is empowered to investigate any matter relating to the Company's
accounting, auditing, internal control or financial reporting practices brought
to its attention, with full access to all Company books, records, facilities and
personnel. The Committee may retain outside counsel, auditors or other advisors.
One member of the Committee shall be appointed as chair. The chair shall be
responsible for leadership of the Committee, including scheduling and presiding
over meetings, preparing agendas and making regular reports to the Board. The
chair will also maintain regular liaison with the CEO, CFO and the lead
independent audit partner.
The Committee shall meet at least four times a year, or more frequently as
the Committee considers necessary. At least once each year the Committee shall
have separate private meetings with the independent auditors, management and the
internal auditors.
Responsibilities
----------------
Although the Committee may wish to consider other duties from time to time,
the general recurring activities of the Committee in carrying out its oversight
role as described below. The Committee shall be responsible for:
1. Recommending to the Board the independent auditors to be retained (or
nominated for shareholder approval) to audit the financial statements of
the Company, which auditors are ultimately accountable to the Board and the
Committee, as representatives of the shareholders.
2. Evaluating, together with the Board and management, the performance of the
independent auditors and where appropriate, replacing such auditors.
3. Obtaining annually from the independent auditors a formal written statement
describing all relationships between the auditors and the Company,
consistent with Independence Standards Board Standard Number 1. The
Committee shall actively engage in a dialogue with the independent auditors
with respect to any relationships that may impact the objectivity and
independence of the auditors and shall take or recommend that the Board
take appropriate actions to oversee and satisfy itself as to the auditors'
independence.
4. Reviewing the audited financial statements and discussing them with
management and the independent auditors. These discussions shall include
the matters required to be discussed under Statement of Auditing Standards
No. 61 and consideration of the quality of the Company's accounting
principles as applied in its financial reporting, including a review of
particularly sensitive accounting estimates, reserves and accruals,
judgmental areas, audit adjustments (whether or not recorded), and other
such inquiries as the Committee or the independent auditors shall deem
appropriate. Based on such review, the Committee shall make its
recommendation to the Board as to the inclusion of the Company's audited
financial statements in the Company's Annual Report on Form 10-K (or the
Annual Report to Shareholders, if distributed prior to the filing of the
Form 10-K).
5. Issuing annually a report to be included in the Company's proxy statement
as required by the rules of the Securities and Exchange Commission.
6. Overseeing the relationship with the independent auditors, including
discussing with the auditors the nature and rigor of the audit process,
receiving and reviewing audit reports, and providing the auditors full
access to the Committee (and the Board) to report on any and all
appropriate matters.
7. Discussing with a representative of management and the independent auditors
(1) the interim financial information contained in the Company's Quarterly
Report on Form 10-Q prior to its filing, (2) the earnings announcement
prior to its release (if practicable), and (3) the results of the review of
such information by the independent auditors. (These discussions may be
held with the Committee as a whole or with the Committee chair in person or
by telephone.)
8. Discussing with management and the independent auditors the quality and
adequacy of and compliance with the Company's internal controls.
9. Discussing with management and/or the Company's general counsel any legal
matters (including the status of pending litigation) that may have a
material impact on the Company's financial statements, and any material
reports or inquiries from regulatory or governmental agencies.
The Committee's job is one of oversight. Management is responsible for the
preparation of the Company's financial statements and the independent auditors
are responsible for auditing those financial statements. The Committee and the
Board recognize that management and the independent auditors have more resources
and time, and more detailed knowledge and information regarding the Company
accounting, auditing, internal control and financial reporting practices than
the Committee does; accordingly the Committee's oversight role does not provide
any expert or special assurance as to the financial statements and other
financial information provided by the Company to its shareholders and others.