UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-12
GYRODYNE COMPANY OF AMERICA, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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GYRODYNE COMPANY OF AMERICA, INC.
1 FLOWERFIELD, SUITE 24
SAINT JAMES, NEW YORK 11780
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
TO BE HELD ON
DECEMBER 7, 2006
TO THE SHAREHOLDERS OF GYRODYNE COMPANY OF AMERICA, INC.:
NOTICE IS HEREBY GIVEN, pursuant to the by-laws, that the Annual Meeting of
Shareholders (the "Annual Meeting") of Gyrodyne Company of America, Inc. (the
"Company") will be held at Flowerfield Celebrations, Mills Pond Road, Saint
James, New York 11780, on Thursday, December 7, 2006 at 11:00 a.m., Eastern
Time.
The purpose of the Annual Meeting is to consider and vote upon the following
matters:
1. To elect three (3) directors to a three-year term of office, or until
their successors shall be duly elected and qualified;
2. To ratify the engagement of Holtz Rubenstein Reminick LLP, independent
accountants, as auditors of the Company and its subsidiaries for the
Fiscal Year ending April 30, 2007;
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice. By order of the Board of Directors, only shareholders
of record at the close of business on October 30, 2006 are entitled to notice of
and to vote at the Annual Meeting, or any adjournment thereof. Enclosed in this
mailing are the Notice of the 2006 Annual Meeting of Shareholders, Proxy
Statement, Proxy Card and Attendance Registration Form.
To obtain an admittance card for the Annual Meeting, please complete the
enclosed Attendance Registration Form and return it with your Proxy Card. If
your shares are held by a bank or broker, you may obtain an admittance card by
returning the Attendance Registration Form they forwarded to you. If you do not
receive an Attendance Registration Form, you may obtain an admittance card by
sending a written request, accompanied by proof of share ownership, to the
undersigned. For your convenience, we recommend that you bring your admittance
card to the
Annual Meeting so you can avoid registration and proceed directly to the Annual
Meeting. However, if you do not have an admittance card by the time of the
Annual Meeting, please bring proof of share ownership to the registration area
where our staff will assist you.
By Order of the Board of Directors,
/s/ Peter Pitsiokos
Peter Pitsiokos
Corporate Secretary
November 9, 2006
YOUR VOTE IS IMPORTANT
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON.
HOWEVER, WE ENCOURAGE YOU TO SIGN, DATE AND PROMPTLY RETURN THE PROXY IN THE
ENCLOSED ENVELOPE, REGARDLESS OF WHETHER YOU PLAN TO ATTEND THE MEETING. GIVING
YOUR PROXY WILL NOT AFFECT YOUR RIGHT TO VOTE IN PERSON IF YOU ATTEND THE
MEETING, BUT WILL HELP ASSURE A QUORUM AND AVOID FURTHER PROXY SOLICITATION
COSTS. ATTENDANCE AT THE ANNUAL MEETING IS LIMITED TO SHAREHOLDERS, THEIR
PROXIES AND INVITED GUESTS OF THE COMPANY. FOR IDENTIFICATION PURPOSES, "STREET
NAME" SHAREHOLDERS WILL NEED TO BRING A COPY OF A BROKERAGE STATEMENT REFLECTING
STOCK OWNERSHIP AS OF THE RECORD DATE.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 7, 2006
GENERAL
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors (the "Board") of Gyrodyne Company of America, Inc.
("Gyrodyne" or the "Company") for use at the Annual Meeting of Shareholders (the
"Annual Meeting") to be held Thursday, December 7, 2006 at 11:00 a.m., Eastern
Time, at Flowerfield Celebrations, Mills Pond Road, Saint James, New York 11780
and at any and all adjournments thereof.
VOTING SECURITIES AND PROXIES
The Board has fixed the close of business on October 30, 2006 as the record date
(the "Record Date") for the determination of shareholders entitled to notice of,
and to vote at, the Annual Meeting. The securities which may be voted at the
Annual Meeting consist of shares of common stock, par value $1.00 per share, of
the Company (the "Common Stock"). Holders of Common Stock are entitled to one
vote per share. Shareholders do not have cumulative voting rights. It is
necessary for a quorum that record holders of a majority of the shares
outstanding and entitled to vote as of the Record Date be represented by proxy
or in person at the Annual Meeting. The number of shares of Common Stock, the
Company's only authorized class of stock, outstanding on the Record Date was
1,237,219. This Proxy Statement and the enclosed proxy card were mailed starting
on or about November 9, 2006.
At the Annual Meeting, shareholders will consider and vote upon the following
matters: (i) the election of three (3) directors to a three-year term of office
and (ii) the ratification of the engagement of independent accountants for the
Company for the fiscal year ending April 30, 2007.
Proxies solicited by the Board will be voted in accordance with the instructions
given therein. Where no instructions are indicated, proxies will be voted "FOR"
the election of the nominees for director, and "FOR" the ratification of the
engagement of independent accountants. Directors shall be elected by a plurality
of the votes cast. The proposal to ratify the appointment of independent
accountants will be decided by a majority of the votes cast. If you do not
return your duly signed proxy card, your shares cannot be voted unless you
attend the Annual Meeting and vote in person or present a duly signed proxy at
the Annual Meeting. Proxies solicited hereby will be tabulated by inspectors of
election designated by the Board of Directors, who will not be directors or
officers of the Company. After the final adjournment of the Annual Meeting, the
proxies will be returned to the Company for safekeeping.
Management does not know of any other matters that may be presented. If any
other matters properly come before the Annual Meeting or adjournments thereof,
the persons named in the
enclosed proxy will vote on such matters in accordance with their best judgment
pursuant to the discretionary authority included in the proxy.
The cost of soliciting proxies will be paid by the Company. In addition to
solicitation by mail, officers, directors, and regular employees of the Company
may, without compensation (other than their regular compensation), solicit
proxies telephonically, electronically or by other means of communication.
Brokerage houses and other custodians, nominees and fiduciaries will be
requested to forward solicitation materials to their principals and the Company
will reimburse the expense of doing so. In addition, Mackenzie Partners Inc., a
proxy solicitation firm, will assist the Company in soliciting proxies for the
Annual Meeting and will be paid a fee of $7,500 plus out-of-pocket expenses.
Any shareholder executing the enclosed proxy has the right to revoke it at any
time prior to its exercise by delivering to the Company a written revocation or
a duly executed proxy bearing a later date, or by attending the Annual Meeting
and voting in person. However, if you are a shareholder whose shares are not
registered in your own name, you will need appropriate documentation from your
record holder to attend the Annual Meeting and to vote personally at the Annual
Meeting.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
IN THIS PROXY STATEMENT
This Proxy Statement and the documents incorporated by reference into this
Proxy Statement contain forward-looking statements about Gyrodyne within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Statements containing the words "believes," "anticipates," "estimates,"
"expects," "intends," "plans," "seeks," "will," "may," "should," "would,"
"projects," "predicts," "continues" and similar expressions or the negative of
these terms constitute forward-looking statements that involve risks and
uncertainties. We intend such forward-looking statements to be covered by the
safe harbor provisions for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995, and they are included in this
Statement for the purpose of invoking these safe harbor provisions. Such
statements are based on current expectations and are subject to risks,
uncertainties and changes in condition, significance, value and effect. Such
risks, uncertainties and changes in condition, significance, value and effect
could cause Gyrodyne's actual results to differ materially from those
anticipated events, such as the effect of economic and business conditions,
risks inherent in the Long Island, New York and Palm Beach County, Florida real
estate markets, the ability to obtain additional capital to develop the
Company's existing real estate and other risks detailed from time to time in the
Company's SEC reports. Except as may be required under federal law, we undertake
no obligation to update publicly any forward-looking statements for any reason,
even if new information becomes available or other events occur.
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DISCUSSION OF PROPOSALS TO BE CONSIDERED AT THE ANNUAL MEETING
ELECTION OF DIRECTORS
(Proposal 1)
The By-Laws of the Company provide that there shall be not less than three
(3), nor more than nineteen (19), directors. On October 18, 2006, the Board of
Directors of the Company expanded the size of the Board from seven (7) to eight
(8) directors and elected Nader G.M. Salour as the eighth director with a term
expiring at the Annual Meeting. The Board is divided into three (3) classes of
directors serving staggered terms of office with each class to consist, as
nearly as possible, of one-third of the total number of directors constituting
the entire Board of Directors. Upon the expiration of the term of office for a
class of directors, the nominees for that class are elected for a three (3) year
term to serve until the election and qualification of their successors. At the
Annual Meeting, three (3) directors of the Company are to be elected to
three-year terms, each to serve until his or her successor is elected and has
been qualified. The Board of Directors of the Company has nominated Paul L.
Lamb, Richard B. Smith and Nader G.M. Salour to three (3) year terms, upon the
recommendation of our Nominating Committee. All three nominees are members of
the present Board of Directors of the Company, with terms expiring at the Annual
Meeting. Each properly executed proxy received will be voted in accordance with
the instruction given therein. Where no instructions are indicated, proxies will
be voted "FOR" the election of the foregoing three (3) nominees as directors to
serve three-year terms or until their respective successors shall be elected and
shall qualify. The nominees have consented to be named as nominees in the Proxy
Statement and to serve as directors if elected.
Should any nominee become unable or unwilling to accept a nomination or
election, the persons named in the enclosed proxy will vote for the election of
a nominee designated by the Board.
Information concerning the nominees and continuing directors of the Company,
showing the year when first elected as a director of the Company, the age,
principal occupation and principal affiliations for at least the last five
years, is as follows.
Nominees for Election at the Annual Meeting
-------------------------------------------
Director Term
Name Business Experience and Current Directorships Age Since Expiring
---- --------------------------------------------- --- ----- --------
Paul L. Lamb Chairman of the Board of Directors of the Company 61 1997 2006
from March 1999 to present; Partner, Lamb &
Barnosky, LLP since 1984.
Richard B. Smith Vice President, Commercial Banking Division, First 52 2002 2006
National Bank of Long Island, February 2006 to
present; Banking Consultant, March 2005 to
February 2006; Senior Vice President for Private
Banking, Suffolk County National Bank, May 2000 to
February 2005; District Manager for Private
Banking, Key Bank, January 1989 to May 2000; Mayor
of the Incorporated Village of Nissequogue, New
York; Trustee of Smithtown Historical Society;
Trustee of St. Catherine's Medical Center.
3
Director Term
Name Business Experience and Current Directorships Age Since Expiring
---- --------------------------------------------- --- ----- --------
Nader G.M. Salour Principal, Cypress Realty of Florida, September 48 2006 2006
2000 to present; President, Abacoa Development
Company, June 1996 to June 2006; Director, Abacoa
Partnership for Community, December 1997 to
present.
Incumbent Directors - Terms Expiring 2007
-----------------------------------------
Director Term
Name Business Experience and Current Directorships Age Since Expiring
---- --------------------------------------------- --- ----- --------
Ronald J. Macklin Assistant General Counsel, Keyspan Corporate 44 2003 2007
Services, a wholly-owned subsidiary of Keyspan
Corporation, October 2003 to present; various
positions within the Office of General Counsel of
Keyspan Corporate Services, 1991 to October 2003.
Stephen V. Maroney President, CEO and Treasurer of the Company, March 64 1996 2007
14, 1999 to present; Director of real estate
development for the Company, June 1996 to March
1999; former President of Extebank, a Long Island
based commercial bank.
4
Director Term
Name Business Experience and Current Directorships Age Since Expiring
---- --------------------------------------------- --- ----- --------
Philip F. Palmedo Chairman of the Board, International Resources 72 1996 2007
Group, 1978 to present; Director, EHR Investments,
2001 to present; President, Palmedo Associates,
1980 to present; Director, Stony Brook Foundation,
1990 until 2005.
Incumbent Directors - Terms Expiring 2008
-----------------------------------------
Director Term
Name Business Experience and Current Directorships Age Since Expiring
---- --------------------------------------------- --- ----- --------
Robert H. Beyer Management and Sales Consultant for more than the 73 1977 2008
past five years; Naval Air Systems Command
Engineer prior to retirement in 1998; Captain,
United States Naval Reserves, prior to retirement
in 1993; Technical Representative for the
Company's former helicopter subsidiary until 1973.
Elliot H. Levine Senior member, Levine & Seltzer LLP, from January 53 2004 2008
1992 to present.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
ELECTION OF THE NOMINEES FOR DIRECTOR. THIS IS IDENTIFIED AS ITEM 1 ON
THE ENCLOSED PROXY CARD.
-----------------------------------------------------------
5
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Principal Shareholders
The following table contains common stock ownership information for persons
known by the Company to own beneficially 5% or more of the Company's common
stock, par value $1.00 per share (the "Common Stock"), as of October 30, 2006.
In general, beneficial ownership includes those shares that a person has the
power to vote, sell or otherwise dispose of. Beneficial ownership also includes
that number of shares which an individual has the right to acquire within 60
days (such as stock options) of the date this table was prepared. Two or more
persons may be considered the beneficial owner of the same shares. We obtained
the information provided in the following table from filings with the SEC and
from information otherwise provided to the Company. In this Proxy Statement,
"voting power" is the power to vote or direct the voting of shares, and
"investment power" is the power to dispose or direct the disposition of shares.
Type of Number of Percent of
Name and Address Ownership Shares Owned Class
---------------- --------- ------------ -----
Bulldog Investors/Goldstein/Dakos Beneficial 217,581 (1) 17.59%
60 Heritage Drive
Pleasantville, NY 10570
Bruce Sherman Beneficial 110,837 8.96%
8889 Pelican Bay Blvd., Suite 500
Naples, Florida 34108
Gerard Scollan Beneficial 101,776 (2) 8.23%
80 Browns River Road
Sayville, NY 11782
(1) Based upon Amendment No. 5 to Schedule 13D jointly filed with the
Securities and Exchange Commission on November 7, 2006 by Bulldog
Investors, Phillip Goldstein and Andrew Dakos. On March 29, 2006, Bulldog
Investors, Phillip Goldstein and Andrew Dakos jointly filed Amendment No. 4
to their Schedule 13D stating that they beneficially own an aggregate of
206,964 shares of Gyrodyne stock, that Mr. Goldstein is deemed to be the
beneficial owner of 172,314 shares, has sole investment power over 77,210
shares, sole voting power over 41,060 shares and shared voting power over
1,600 shares, that Mr. Dakos is deemed to be the beneficial owner of
129,754 shares, has sole investment power over 34,650 shares and sole
voting power over 129,754 shares, and that Mr. Goldstein and Mr. Dakos
jointly share investment power over 95,104 shares.
(2) Includes 99,241 shares of Company Stock held by Lovin Oven Catering of
Suffolk, Inc, of which Mr. Scollan is the majority shareholder.
6
Security Ownership of Directors and Executive Officers
The following table sets forth as of October 30, 2006 the outstanding
voting securities beneficially owned by the directors and executive officers
individually and the number of shares owned by directors and executive officers
as a group. Except as otherwise indicated, each person and each group shown in
the table has sole voting and investment power with respect to the shares of
Common Stock listed next to their name.
Name, Positions with the Amount and Nature of Percentage of
Company and Address Beneficial Ownership (1) Common Stock Owned
------------------- -------------------- ------------------
Stephen V. Maroney, President, CEO, 92,894 (2) 7.21%
Treasurer and Director
c/o Gyrodyne Company of America, Inc.
1 Flowerfield, Suite 24
St. James, NY 11780
Peter Pitsiokos, Chief Operating Officer, 29,205 (3) 2.36%
Chief Compliance Officer and Secretary
c/o Gyrodyne Company of America, Inc.
1 Flowerfield, Suite 24
St. James, NY 11780
Robert H. Beyer, Director 14,211 (4) 1.15%
10505 Indigo Lane
Fairfax, Virginia 22032
Paul L. Lamb, Chairman of the Board of 23,164 (5) 1.87%
Directors
c/o Lamb & Barnosky, LLP
534 Broadhollow Road
Melville, NY 11747
Elliot H. Levine, Director 0 *
c/o Levine & Seltzer, LLP
150 East 52nd Street
New York, NY 10022
Ronald J. Macklin, Director 200 *
c/o Keyspan Corporate Services
175 E. Old Country Road
Hicksville, NY 11801
7
Philip F. Palmedo, Director 12,749 (6) 1.03%
4 Piper Lane
St. James, NY 11780
Richard B. Smith, Director 1,000 *
111 Boney Lane
Nissequogue, NY 11780
Nader G.M. Salour 0 *
c/o Cypress Realty of Florida, LLC
1200 University Boulevard
Suite 210
Jupiter, FL 33458
All Directors and Executive Officers as a 173,423 13.71% (7)
Group (Nine (9) Persons)
* Less than one percent of the total shares of outstanding stock.
(1) For a definition of "beneficial ownership" see "Principal Shareholders."
(2) Includes 51,605 shares issuable upon the exercise of stock options to
purchase Company stock which are exercisable within sixty (60) days of
October 30, 2006.
(3) Does not include his wife's and minor children's ownership of 1,089 shares
in which he denies any beneficial interest.
(4) Does not include his wife's ownership of 1,801 shares in which he denies
any beneficial interest. Includes 1,375 shares issuable upon the exercise
of stock options to purchase Company stock which are exercisable within
sixty (60) days of October 30, 2006.
(5) Includes 13,747 shares of Company stock held by Lamb & Barnosky, LLP Profit
Sharing Trust and 300 shares held by the Paul L. Lamb, P.C. Defined Benefit
Plan. Mr. Lamb is a Trustee of the Profit Sharing Trust and the Defined
Benefit Plan. Mr. Lamb is a partner in Lamb & Barnosky, LLP. Includes 1,375
shares issuable upon the exercise of stock options to purchase Company
stock which are exercisable within sixty (60) days of October 30, 2006.
(6) Does not include his wife's ownership of 4,125 shares in which he denies
any beneficial interest. Includes 1,375 shares issuable upon the exercise
of stock options to purchase Company stock which are exercisable within
sixty (60) days of October 30, 2006.
(7) The percent of class is calculated on the basis of the number of shares
outstanding, which is 1,237,219 as of October 30, 2006 plus, for each
person or group, any shares that person or group has the right to acquire
within 60 days of October 30, 2006 pursuant to options, warrants,
conversion privileges or other rights.
8
INFORMATION ABOUT THE BOARD OF DIRECTORS AND MANAGEMENT
Director Compensation
Directors who are full-time salaried employees of the Company are not
compensated for their service on the Board or any committee. Non-employee
directors are paid an annual fee of $12,000.00, $1,000.00 for each director's
meeting attended, $500.00 for each committee meeting attended and travel and
lodging expenses where appropriate. All compensation is paid in cash. Beginning
in Fiscal Year 2005, the Company began paying an additional fee of $2,000.00 per
month to the Chairman of the Board of Directors. There were no other
arrangements pursuant to which any director was compensated during Fiscal Year
2006 for any service provided as a director.
Non-Employee Directors Stock Option Plan
The Company adopted a non-qualified stock option plan for all non-employee
directors of the Company in October 1996. The plan expired in September 2000.
Each non-employee director was granted an initial 2,500 options on the date of
adoption of the plan. These options were exercisable in three equal annual
installments commencing on the first anniversary date subsequent to the grant.
Additionally, each non-employee director was granted 1,250 options on each
January 1, 1997 through 2000, respectively. These additional options were
exercisable in full on the first anniversary date subsequent to the date of each
grant. The options expire between November 2005 and January 2007.
BOARD MEETINGS, COMMITTEES AND ATTENDANCE
Attendance
There were 12 regular and special meetings of the Board of Directors during
Fiscal Year 2006. Each director attended at least 75% of the meetings of the
Board of Directors and at least 75% of the meetings of each committee of the
Board on which such director served during Fiscal Year 2006.
Independence
The majority of the members of the Board of Directors are independent
directors as defined by the listing requirements of the NASDAQ Stock Market.
Committees
The Board of Directors of the Company has established the following
committees:
The Company has a separately-designated standing Audit Committee
established in accordance with Section 3(a)(58)(A) of the Exchange Act, and its
current members are Messrs. Smith (Chairman), Levine and Macklin. The Audit
Committee meets with the Company's independent auditors annually to review
financial results, audited financial statements, internal
9
financial controls and procedures and audit plans and recommendations. The Audit
Committee also recommends the selection, retention or termination of the
Company's independent auditors, approves services to be provided by the
independent public accountants and evaluates the possible effect the performance
of such services will have on the accountants' independence. The Company has
adopted a written charter for the Audit Committee, a copy of which was attached
as an exhibit to the Company's Proxy Statement in connection with its 2004
Annual Meeting. All of the members of the Audit Committee are independent
directors as defined by the listing requirements of the NASDAQ Stock Market. The
Audit Committee met four (4) times during Fiscal Year 2006. All members of the
Audit Committee are "financially literate" and have been determined to be
"independent" within the meaning of SEC regulations and NASDAQ rules. The Board
has determined that at least one member, Mr. Levine, a certified public
accountant, qualifies as an "audit committee financial expert" as a result of
relevant experience as a partner in the accounting firm of Levine & Seltzer,
LLP, over ten years of accounting experience as a partner and director of taxes
at Leslie Sufrin & Co. P.C. and several other years of experience in the field
of public accounting.
The Executive Compensation Committee consists entirely of non-employee
directors and oversees the Company's compensation and benefit policies and
programs. It recommends to the Board annual salaries, bonuses and other benefits
for elected officers. The Committee met three (3) times in Fiscal Year 2006 and
its members currently are Mr. Levine (Chairman), Mr. Palmedo and Mr. Macklin. No
member of the Committee is or was formerly an officer or employee of the Company
or any of its subsidiaries.
The Nominating Committee consists entirely of non-employee directors and
recommends guidelines to the Board regarding the size and composition of the
Board and criteria for the selection of nominees. It also recommends the slate
of director nominees to be included in the Proxy Statement and recommends
candidates for vacancies which may occur. The Nominating Committee has a written
charter, which is available on the Company's website, www.gyrodyne.com. Each
member of the Nominating Committee is an independent director as defined by the
listing standards of the NASDAQ Stock Market. The Nominating Committee will
accept for consideration shareholders' nominations for directors if made in
writing. The nominee's written consent to the nomination and sufficient
background information on the candidate must be included to enable the Committee
to make proper judgments as to his or her qualifications. Nominations must be
addressed to the Secretary of the Company at the Company's headquarters and must
be received no later than the deadline for submissions of shareholders'
proposals in order to be considered for the next annual election of directors.
The Nominating Committee believes that having directors with relevant experience
in business and industry (in particular, the real estate industry), government,
education and other areas is beneficial and the Committee seeks to monitor the
skills and experience of the Company's directors. All identified candidates,
including shareholder-proposed candidates, are evaluated by the Committee using
generally the same methods and criteria, although those methods and criteria are
not standardized and may vary from time-to-time. The Company typically engages
the services of third parties to perform background examinations of potential
nominees, for which the Company pays a fee, in order to assist the Nominating
Committee in its evaluation. The Committee met once during Fiscal Year 2006 and
its members currently are Mr. Beyer (Chairman), Mr. Palmedo and Mr. Smith.
10
The Stock Option Committee consists entirely of non-employee directors not
eligible to participate in the Company's 1993 Stock Incentive Plan or other
stock option plans for the benefit of Company employees. The primary functions
of the Stock Option Committee include the review and administration of employee
stock option plans for the benefit of officers and key employees. It also
recommends to the Board stock options and awards. The Stock Option Committee
consists of Mr. Palmedo (Chairman), Mr. Levine and Mr. Macklin. The Committee
did not meet in Fiscal Year 2006.
Communication with the Board of Directors
The Board does not currently provide a process for shareholders to send
communications to the Board or any of the directors. The Company believes that
senior management, as opposed to individual directors, provides the public voice
of the Company, and that shareholders can effectively communicate with the
Company by contacting the management of the Company through either regular mail,
email or in person. Shareholders also have meaningful access to the Board
through the shareholder proposal process, which is described below.
Board Attendance Policy
The Company encourages, but does not require, all of its directors to
attend annual shareholders meetings of the Company. Last year all of the
directors were in attendance at the annual meeting of the Company's
shareholders.
REPORT OF THE AUDIT COMMITTEE
This Report of the Audit Committee of the Board of Directors does not
constitute soliciting material and shall not be deemed filed or incorporated by
reference into any of the Company's other filings under the Securities Exchange
Act of 1934, except to the extent that we specifically incorporate this Report
by reference in such other filings. Pursuant to rules of the Securities and
Exchange Commission (the "SEC") and the National Association of Securities
Dealers, Inc. (the "NASD"), the Audit Committee of Gyrodyne Company of America,
Inc. has issued the following report and affirmed that:
(i) We have reviewed and discussed with management the audited financial
statements for the fiscal year ended April 30, 2006.
(ii) We have discussed with the independent auditors the matters required to
be discussed by Statement on Auditing Standards No. 61 pertaining to
communications with Audit Committees, as may be modified or supplemented.
(iii) We have received from the Company's independent accountants the written
disclosures and the letter regarding the auditors' independence as
required by Independence Standards Board Standard No. 1 and we have
discussed with the independent accountant their independence with respect
to the Company.
11
(iv) Based on the review and discussions referred to above, we recommended to
the Board that the audited financial statements be included in the
Company's Annual Report on Form 10-K for the most recent fiscal year for
filing with the SEC.
(v) All of the members of the Company's Audit Committee qualify as being
independent as defined in the applicable listing standards issued by the
NASD.
(vi) The Board of Directors has adopted a written charter for the Audit
Committee.
Members of the Committee
------------------------
Richard B. Smith (Chairman)
Elliot H. Levine
Ronald J. Macklin
EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES WHO ARE NOT DIRECTORS
Peter Pitsiokos, age 47, has served as Executive Vice President and
Secretary for more than the past five years, as Chief Operating Officer and
Chief Compliance Officer since 2004 and as General Counsel from November 1992
until 2004. Mr. Pitsiokos was formerly the Executive Assistant District Attorney
in Suffolk County, New York. He also served as the Assistant Director of
Economic Development and the Director of Water Resources in the Town of
Brookhaven.
Frank D'Alessandro, age 60, joined the Company in March 1997 as its
Controller. Prior to joining the Company, he was Controller of Cornucopia Pet
Foods Inc., a distributor of all natural pet foods. Previous to that he spent
many years in various financial positions. Mr. D'Alessandro holds an MBA degree
in Finance as well as a BBA in Accounting, both from Hofstra University.
EXECUTIVE COMPENSATION
The following table sets forth all compensation during the fiscal years
ended April 30, 2006, April 30, 2005 and April 30, 2004 awarded to, earned by or
paid to Stephen V. Maroney, the Company's President and Chief Executive Officer,
and Peter Pitsiokos, the Company's Chief Operating Officer, Chief Compliance
Officer and Secretary. No other executive officer's total annual salary and
bonus for fiscal year end April 30, 2006 exceeded $100,000.
12
SUMMARY COMPENSATION TABLE
Long Term Compensation
---------------------------------------
Annual Compensation Awards Payouts
---------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Restricted Securities
Annual Stock Underlying LTIP All Other
Name and Principal Salary Bonus Compensation Award(s) Options/ Payouts Compensation
Position Year ($) ($) ($)(A) ($) SARs(#) ($) ($)
------------------------------------------------------------------------------------------------------------------------------------
Stephen V. Maroney 2006 213,207 11,000 41,685(B) 0 0 0 0
President and CEO
2005 209,500 0 29,688(B) 0 0 0 0
2004 209,500 0 49,628(B) 0 17,500 0 0
------------------------------------------------------------------------------------------------------------------------------------
Peter Pitsiokos 2006 155,370 8,290 0 0 0 0 0
COO, CCO and Secretary
2005 152,500 10,000 0 0 0 0 0
2004 152,500 0 70,188(C) 0 13,500 0 0
(A) The Company has concluded that aggregate amounts of personal benefits to
any of the current executives does not exceed the lesser of $50,000 or 10%
of salary and bonus reported above for each of the named executive
officers, and that the information set forth in tabular form above is not
rendered materially misleading by virtue of the omission of such personal
benefits.
(B) In Fiscal Year 2006 and in Fiscal Year 2005, Mr. Maroney exercised 1,375
director options and received an equal number of shares with a value of
$41,685 and $29,688, respectively. In Fiscal Year 2004, Mr. Maroney
exercised 4,125 director options and received an equal number of shares
with a value of $49,628.
(C) In Fiscal Year 2004, Mr. Pitsiokos exercised 6,600 options with SAR's and
received 2,922 shares with a value of $70,188.
During Fiscal Year 2006, there were no options/SAR grants issued to any
directors or officers.
13
Employment Contracts
Effective January 23, 2003, the Company entered into an amended and
restated employment agreement with Stephen V. Maroney as President, Chief
Executive Officer, and Treasurer and Peter Pitsiokos as Executive Vice
President, Secretary, and General Counsel. Their annual salaries are currently
at $220,000 and $160,790, respectively. The terms of the agreements were
extended from one to three years, contain evergreen provisions, and provide for
a severance payment equivalent to three years salary in the event of a change in
control. Both agreements were attached as Exhibit 10, Material Contracts, in the
10-QSB dated January 31, 2003.
1993 Stock Incentive Plan
The shareholders in 1993 adopted a stock incentive plan (the "Plan"), which
expired in October 2003, under which participants may be granted Incentive Stock
Options ("ISOs"), Non-Qualified Stock Options ("NQSOs") or Stock Grants. The
purpose of the Plan was to promote the overall financial objectives of the
Company and its shareholders by motivating those persons selected to participate
in the Plan to achieve growth in shareholder value and retain the association of
those individuals who are instrumental in achieving this growth. Such options or
grants became exercisable at various intervals based upon vesting schedules as
determined by the Executive Compensation Committee. The options expire between
April 2007 and May 2008. There are no remaining shares or rights available for
issuance under this plan. No options or SARs were issued during the last fiscal
year.
The ISOs were granted to employees and consultants of the Company at a
price not less than the fair market value on the date of grant. All such options
were authorized and approved by the Board of Directors, based on recommendations
of the Compensation Committee. ISOs were granted along with Stock Appreciation
Rights, which permitted the holder to tender the option to the Company in
exchange for stock, at no cost to the optionee, that represented the difference
between the option price and the fair market value on date of exercise. NQSOs
were issued with Limited Stock Appreciation Rights, which were exercisable, for
cash, in the event of a change of control. In addition, an incentive kicker was
provided for Stock Grants, ISOs and NQSOs, which increased the number of grants
or options based on the market price of the shares at exercise versus the option
price.
14
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
--------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
April 30, 2006 (#) April 30, 2006 ($)
Shares Acquired Exercisable/ Exercisable/
Name on Exercise Value Realized Unexercisable Unexercisable
--------------------------------------------------------------------------------------------------
Stephen V. Maroney 12,925 $385,586 51,605/0 $1,608,608/$0
President and CEO
Incentive Compensation Plan
The Company has an incentive compensation plan, which was established in
1999 and amended in 2004, for all full-time employees and members of the Board
in order to promote shareholder value. The benefits of the incentive
compensation plan are realized only upon a change in control of the Company.
Change in control is defined as the accumulation by any person, entity or group
of 30% or more of the combined voting power of the Company's voting stock or the
occurrence of certain other specified events. In the event of a change in
control, the Company's plan provides for a cash payment equal to the difference
between the plan's "establishment date" price of $15.39 per share and the per
share price of the Common Stock on the closing date, equivalent to 100,000
shares of Common Stock, such number of shares and "establishment date" price per
share subject to adjustments to reflect changes in capitalization. The payment
amount would be distributed to eligible participants based upon their respective
weighted percentages (ranging from 0.5% to 18.5%).
Compensation Committee Interlocks and Insider Participation
The Compensation Committee of the Company's Board of Directors consists of
directors Elliot Levine (Chairman), Ronald Macklin and Philip Palmedo. No member
of the Committee is or was formerly an officer or employee of the Company or any
of its subsidiaries. No member of the Committee had any relationship requiring
disclosure by the Company under any paragraph of Item 404 of Regulation S-K.
Report of the Compensation Committee
The Compensation Committee of the Company's Board of Directors consists of
directors Elliot Levine (Chairman), Ronald Macklin and Philip Palmedo, all of
whom the Board has determined are independent pursuant to NASDAQ rules. This
report shall not be deemed incorporated by reference into any filing under the
Securities Act of 1933, as amended (the "Securities Act"), or the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), by
15
virtue of any general statement in such filing incorporating this Proxy
Statement by reference, except to the extent that the Company specifically
incorporates the information contained in this section by reference, and shall
not otherwise be deemed filed under either the Securities Act or the Exchange
Act.
The Compensation Committee oversees and administers the Company's executive
compensation programs and is therefore responsible for establishing guidelines
and approving all compensation paid to executive officers. The Company's
compensation policies for executives are intended to further the interests of
the Company and its shareholders by encouraging growth of its business through
securing, retaining and motivating management employees of high caliber who
possess the skills necessary for the development and growth of the Company.
The Company's executive compensation program consists of two principal
elements: a base salary and the potential to earn a performance-based annual
bonus. In the past, a third component included a stock option plan that expired
in October 2003. The program is designed to motivate and retain key executives
to manage the business affairs of the Company in the best long term interests of
the Company and its shareholders.
The Committee recognizes that a variety of events and circumstances might
influence an individual's performance or that of the Company itself. As a
result, the Committee carefully considers all relevant events and circumstances
in making its compensation decisions in order to ensure that the appropriate
relationship exists between executive compensation and corporate performance.
The Committee also negotiates the terms of all employment contracts with
executive officers which include compensation arrangements designed to reward
management for achieving certain performance goals and which are revisited on an
as needed basis.
In setting and adjusting base salary levels for each individual executive,
the Compensation Committee considers factors such as the executive's scope of
responsibility, the executive's performance, the performance of the Company,
future potential, and benchmarks of comparable positions at other companies. In
making salary decisions, the Compensation Committee exercises its best judgment
using no specific weights for the previously discussed factors.
The Company maintains the option to supplement base compensation with
awards of performance bonuses in the form of cash to reward efforts undertaken
by its key executive officers that are extraordinary in nature.
In order to evaluate the appropriate levels of compensation for the
Company's executive officers, the Committee reviews a number of factors,
including performance and progress towards achieving established goals. The
Committee also takes into consideration other contributing factors to the
officers overall compensation which may include past performance, anticipated
contributions to future success, additional responsibilities, and vulnerability
to recruitment by other companies.
16
As of January 1, 2006, the Board approved, based primarily upon the
recommendation of the Compensation Committee, base salary for the Company's two
executive officers, Stephen Maroney and Peter Pitsiokos, in the amount of
$220,000 and $160,262, respectively, and cash bonuses of $11,000 and $8,290 for
Mr. Maroney and Mr. Pitsiokos, respectively, which were paid on or prior to
February 15, 2006.
Members of the Compensation Committee
Elliot Levine, Chairman
Ronald Macklin
Philip Palmedo
Performance Graph
The following graph compares total shareholder returns from April 30, 2001
through April 30, 2006 to the Standard & Poor's 500 Index ("S&P 500") and to the
Dow Jones U.S. Real Estate Index Fund ("DJ Real Estate Index"). The graph
assumes that the value of the investment in the Company's Common Stock and in
the S&P 500 and DJ Real Estate Index indices was $100 at April 30, 2001 and that
all dividends were reinvested. The price of the Company's Common Stock on April
30, 2001 (on which the graph is based) was $16.70. The shareholder return shown
on the following graph is not necessarily indicative of future performance.
Comparison of Five Year Cumulative Total Return
Fiscal Year Ended April 30, 2006
[GRAPHIC OMITTED]
17
Period Ending
---------------------------------------------------------------
Index 04/30/01 04/30/02 04/30/03 04/30/04 04/30/05 04/30/06
----- -------- -------- -------- -------- -------- --------
Gyrodyne 100.00 101.44 101.20 164.64 243.88 283.68
S&P 500 100.00 87.37 75.75 93.07 98.97 114.23
DJ Real Estate Index 100.00 110.75 103.17 120.62 153.90 183.97
TRANSACTIONS WITH CERTAIN RELATED PERSONS
There was one transaction in Fiscal 2006 in which the Company was a party
and in which any officer, director or beneficial owner of more than 5% of the
Company's common stock, or any member of the immediate family of any of the
foregoing persons, had a direct or indirect material interest which exceeded
$60,000.
The Company had a mortgage receivable in the original amount of $1,800,000
due from Sco Properties, Inc. which was paid in full in August, 2005. Mr.
Scollan, president of Sco Properties, Inc., is considered a principal
shareholder of the Company because he has beneficial ownership of 8.23% of the
Company shares. The terms of the mortgage are described in greater detail in
Note 3 of the Company's consolidated financial statements for Fiscal 2006 which
were included in the Company's Annual Report on Form 10-K for Fiscal 2006. The
Company believes that the terms of the mortgage were no less favorable to the
Company than could have been obtained from an unaffiliated third party. The
Company received $15,459 in interest during Fiscal 2006 and $86,361 in the prior
fiscal year. Interest payments received in Fiscal 2006 were lower than in Fiscal
2005 as the result of the payment in full of the mortgage debt in the fourth
month of Fiscal 2006.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires that the Company's directors,
executive officers and any person holding more than ten percent of the Company's
Common Stock file with the SEC reports of ownership and changes in ownership,
and that such individuals furnish the Company with copies of the reports.
Based solely on our review of the copies of such forms received by us with
respect to Fiscal Year 2006, and any written representations from reporting
persons that no Forms 5 were required, the Company believes that none of the
Company's executive officers, directors or ten-percent holders failed to file on
a timely basis reports required by section 16(a) of the Exchange Act during
Fiscal 2006 or prior fiscal years.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
(Proposal 2)
The Board of Directors, upon the recommendation of the Audit Committee,
which is comprised entirely of independent directors, has appointed the
accounting firm of Holtz Rubenstein Reminick LLP ("Holtz Rubenstein") as
independent public accountants of the
18
Company and its subsidiaries for the current Fiscal Year. The appointment of
Holtz Rubenstein has been ratified by the shareholders every year since 1990.
The Board is requesting ratification of Holtz Rubenstein as independent public
accountants. This firm has no financial interest in the Company or any
connection with the Company other than as auditors and independent public
accountants. The report of Holtz Rubenstein with respect to the Company's
financial statements appears in the Company's annual report for Fiscal Year
2006.
In the event the proposal is defeated, the adverse vote will be considered
a direction to the Board to select other independent public accountants for the
next fiscal year. However, because of the expense and difficulty of making any
substitution of independent public accountants after the beginning of a fiscal
period, it is contemplated that the appointment for Fiscal Year 2007 will be
permitted to stand unless the Board finds other reasons for making the change.
Audit Fees. Audit fees with out-of-pocket expenses billed or expected to be
billed to the Company by Holtz Rubenstein for professional services rendered for
the audit of the Company's financial statements for the fiscal year ended April
30, 2006 and for reviews of the Company's financial statements included in the
Company's quarterly reports on Form 10-QSB for Fiscal Year 2006 totaled $51,600
and for Fiscal Year 2005 totaled $43,100.
Audit-Related Fees. Audit-related fees, consisting of aggregate fees billed
for assurance and related services by Holtz Rubenstein that are reasonably
related to the performance of the audit or review of the Company's financial
statements that are not reported under "Audit Fees" totaled $3,500 in Fiscal
Year 2006 and totaled $7,444 for Fiscal Year 2005. These fees include
discussions regarding Sarbanes Oxley compliance and consultations regarding the
Company's limited partnership interest in Callery-Judge Grove.
Tax Fees. Aggregate fees billed for professional services rendered by Holtz
Rubenstein for tax compliance, tax planning and tax advice totaled $29,000 in
Fiscal Year 2006 and $22,900 in Fiscal Year 2005. These fees relate primarily to
the preparation of corporate tax returns, consultation regarding the proceedings
relating to the condemnation of a portion of the Company's Flowerfield property
and the Company's conversion to REIT status.
All Other Fees. Other fees, consisting of aggregate fees billed for the
audit of the Company's Defined Benefit Pension Plan, totaled $11,200 in Fiscal
Year 2006 and totaled $10,000 for Fiscal Year 2005.
None of the services performed by Holtz Rubenstein for the Company were
performed by non full time Holtz Rubenstein employees.
Our Audit Committee has determined not to adopt any blanket pre-approval
policies or procedures. Instead, the Committee will review each service on a
case-by-case basis before approving the engagement of Holtz Rubenstein for audit
or permissible non-audit services.
19
The Audit Committee reviews each proposed engagement to determine whether
the provision of services is compatible with maintaining the independence of the
independent auditors. All of the fees shown above were pre-approved by the Audit
Committee.
A representative of Holtz Rubenstein is expected to be present at the
Annual Meeting, will be given an opportunity to make a statement if he or she
desires to do so and is expected to be available at a designated time during the
Annual Meeting to respond to appropriate questions.
--------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS
VOTE "FOR" THE RATIFICATION OF APPOINTMENT OF HOLTZ RUBENSTEIN
REMINICK LLP AS INDEPENDENT AUDITORS. THIS IS IDENTIFIED AS ITEM 2 ON
THE ENCLOSED PROXY CARD.
--------------------------------------------------------------
FINANCIAL STATEMENTS
Accompanying this Proxy Statement is the Annual Report for Fiscal Year
ended April 30, 2006 which includes audited Balance Sheets, for each of the two
most recent fiscal years, and Statements of Operations and Cash Flows for each
of the three most recent fiscal years.
20
2007 SHAREHOLDER PROPOSALS
If a shareholder wishes to have a particular proposal considered by the
Board for inclusion in the Company's Proxy Statement for an Annual Meeting of
Shareholders, the shareholder must satisfy the requirements set by the SEC in
its proxy rules. The particular proxy rule, Rule 14a-8, requires that
shareholders submit their proposals in writing to the Company at least 120 days
before the anniversary date of the proxy statement mailing date for the prior
year's annual meeting. Thus, shareholders who wish to submit their proposals for
inclusion in the Company's proxy statement for next year's annual meeting must
deliver such proposals to the Corporate Secretary on or before July 13, 2007.
The notice must clearly identify the proposal, contain a brief supporting
statement and all required information about the proposing shareholder, and
otherwise satisfy the SEC's rule. Proposals should be addressed to the Secretary
of the Company, Gyrodyne Company of America, Inc., 1 Flowerfield, Suite 24,
Saint James, New York 11780.
In order for a shareholder nomination or proposal to be raised from the
floor during the 2007 Annual Meeting of Shareholders, the Company's by-laws
require that written notice thereof must be received by the Company not less
than 120 days nor more than 150 days before the anniversary date of the prior
year's annual meeting (there are special rules if the current year's meeting
date is held more than 30 days before, or more than 60 days after, the
anniversary of the prior year's meeting date, or if the number of directors is
changed). For the 2007 Annual Meeting of Shareholders, the written notice must
be given not later than August 9, 2007 and no earlier than July 10, 2007. The
shareholder's written notice must contain (i) all information relating to any
nominees proposed by the shareholder that is required to be disclosed in
solicitations of proxies pursuant to Regulation 14A under the Securities
Exchange Act of 1934 and Rule 14a-11 thereunder, (ii) a brief description of any
proposals sought to be presented for a vote at the Meeting, (iii) the
shareholder's name and record address and (iv) the class and number of shares of
Company Common Stock that is beneficially owned. Shareholders proposing nominees
for election to the Board of Directors must have continuously held at least
$2,000 in market value, or 1%, of the Company's outstanding Common Stock
entitled to vote for at least one year by such date of giving of notice or be
entitled to cast votes with respect to at least 5% of the outstanding Common
Stock. Nominations and proposals should be submitted in writing to the Secretary
of the Company, Gyrodyne Company of America, Inc., 1 Flowerfield, Suite 24,
Saint James, New York 11780, who will submit them to the Board for its
consideration.
BY ORDER OF THE BOARD OF DIRECTORS
Peter Pitsiokos
Corporate Secretary
21
Appendix 1
GYRODYNE COMPANY OF AMERICA, INC.
ANNUAL MEETING OF SHAREHOLDERS, DECEMBER 7, 2006
Revocable Proxy
PROXY/AUTHORIZATION AND DIRECTION FOR EXECUTION
OF PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby designates Stephen V. Maroney and Peter Pitsiokos,
and each of them, their true and lawful agents and proxies with full power of
substitution in each, to represent the undersigned at the Annual Meeting of
Shareholders of GYRODYNE COMPANY OF AMERICA, INC. to be held at Flowerfield
Celebrations, Mills Pond Road, St. James, New York 11780 on Thursday, December
7, 2006 at 11:00 A.M., and any adjournment thereof, and revoking all proxies
heretofore given, as designated hereon. As to any other matter, the proxies
shall be authorized to vote in accordance with their best judgment. This proxy
shall remain in effect for a period of one year from its date.
SIGN BELOW - Please sign exactly as your name appears hereon. If shares are
registered in more than one name, all should sign but if one signs, it binds the
others. When signing as attorney, executor, administrator, agent, trustee or
guardian, please give full title as such. If a corporation, please sign in full
corporate name by an authorized person. If a partnership, please sign
partnership name by an authorized person.
Dated __________________________ Signature_______________________________
Signature_______________________________
THIS PROXY/AUTHORIZATION AND DIRECTION FOR EXECUTION OF PROXY, IF PROPERLY
EXECUTED, WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE FOR A PROPOSAL, THE
SHARES WILL BE VOTED IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS.
Receipt of the Proxy Statement and Annual Report is hereby acknowledged.
A vote FOR Item 1 is recommended by the Board of Directors.
1. To elect three directors to serve for a term of three years and until their
successors shall be elected and shall qualify:
Paul L. Lamb Term Expiring 2009 [ ] FOR [ ] WITHHELD
Nader G.M. Salour Term Expiring 2009 [ ] FOR [ ] WITHHELD
Richard B. Smith Term Expiring 2009 [ ] FOR [ ] WITHHELD
22
A vote FOR Item 2 is recommended by the Board of Directors.
2. To ratify the engagement of Holtz Rubenstein Reminick LLP as Certified
Public Accountants for the current fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
23