UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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 Rule 14a-11(c) or Rule 14a-12
FINANCIAL FEDERAL CORPORATION
------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
--------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------
(5) Total fee paid:
--------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
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:
--------------------------------------------------------------------------
(2) Form, Schedule or Registration No.:
--------------------------------------------------------------------------
(3) Filing Party:
--------------------------------------------------------------------------
(4) Date Filed:
--------------------------------------------------------------------------
FINANCIAL FEDERAL
CORPORATION
Notice of Annual
Meeting of Stockholders
and Proxy Statement
Tuesday, December 13, 2005
at 10:00 a.m. Eastern Time
270 Park Avenue, 11th Floor
New York, New York 10017
FINANCIAL FEDERAL CORPORATION
733 Third Avenue, 24th Floor
New York, New York 10017
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Tuesday, December 13, 2005, 10:00 a.m.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Annual Meeting" or "Meeting") of Financial Federal Corporation, a Nevada
corporation (the "Company"), will be held at 270 Park Avenue, 11th Floor, New
York, New York 10017 on Tuesday, December 13, 2005, at 10:00 a.m. Eastern Time,
to
(1) Elect seven directors to serve until the next annual meeting
of stockholders;
(2) Ratify the appointment of KPMG LLP as the Company's
independent registered public accounting firm for the fiscal
year ending July 31, 2006; and
(3) Transact any other business that properly comes before the
Annual Meeting.
The Board of Directors of the Company has fixed the close of business on
October 26, 2005 as the record date for the determination of stockholders
entitled to notice of and to vote at the Annual Meeting. The list of
stockholders entitled to vote at the Annual Meeting will be available for
inspection by any stockholder for any valid purpose related to the Annual
Meeting at the office of Financial Federal Corporation, 733 Third Avenue, 24th
Floor, New York, New York 10017 for the ten days before the Annual Meeting. The
list will also be available during the Annual Meeting for inspection by any
stockholder present at the Meeting. We are enclosing a copy of the Company's
Annual Report to Stockholders for the fiscal year ended July 31, 2005.
All stockholders are cordially invited to attend the Annual Meeting.
Whether or not you plan to attend the Annual Meeting, please complete, date,
sign and return the enclosed proxy card as soon as possible in the enclosed
reply envelope.
FINANCIAL FEDERAL CORPORATION
Troy H. Geisser
Secretary
November 9, 2005
New York, New York
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT YOU
PLAN TO ATTEND THE ANNUAL MEETING, PLEASE FILL IN, SIGN AND DATE THE ENCLOSED
PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE THAT DOES NOT NEED POSTAGE IF
MAILED IN THE UNITED STATES.
FINANCIAL FEDERAL CORPORATION
733 Third Avenue, 24th Floor
New York, New York 10017
PROXY STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
To Be Held On December 13, 2005
This Proxy Statement and the accompanying form of proxy are solicited by
the Board of Directors (the "Board of Directors" or the "Board") of Financial
Federal Corporation, a Nevada corporation (the "Company"), to be voted at the
Annual Meeting of Stockholders to be held at 270 Park Avenue, 11th Floor, New
York, New York 10017 on December 13, 2005 and at any postponements or
adjournments.
Shares represented by properly executed proxies, received timely and not
revoked, will be voted at the Meeting in the manner described in the proxies.
Stockholders may revoke their proxy before its exercise by written notice to the
Company's Secretary stating that their proxy is revoked, by submitting another
proxy with a later date or by attending the Meeting and voting in person. Please
note, however, that if a stockholder's shares are held of record by a broker,
bank or other nominee and that stockholder wishes to vote at the Meeting, the
stockholder must bring a letter from the broker, bank or other nominee
confirming the stockholder's beneficial ownership of shares on October 26, 2005.
At the Meeting, the Company's stockholders will be asked (i) to elect the
Board of Directors to serve until the next annual meeting of stockholders (ii)
to ratify the appointment of KPMG LLP ("KPMG") as the Company's independent
registered public accounting firm for the fiscal year ending July 31, 2006 and
(iii) to take any other actions that properly come before the Meeting. Each
proposal is described in more detail in this Proxy Statement.
The approximate date this Proxy Statement and accompanying form of proxy
will first be sent or given to stockholders is November 9, 2005. Holders of the
Company's common stock, par value $.50 per share (the "Common Stock"), on the
record date, the close of business on October 26, 2005, are entitled to vote at
the Meeting. On October 26, 2005, 17,550,179 shares of the Company's Common
Stock were outstanding and no shares of the Company's preferred stock, par value
$1.00, were outstanding.
Each share of Common Stock entitles the holder on the record date to one
vote on matters to be considered at the Meeting. The presence, in person or by
proxy, of stockholders holding a majority of the issued and outstanding shares
of Common Stock entitled to vote at the Meeting is necessary to constitute a
quorum. Abstentions and broker non-votes are each included to determine the
presence or absence of a sufficient number of shares to constitute a quorum for
to transact business. A broker non-vote occurs when a nominee holding shares for
a beneficial owner does not vote on a particular proposal because the nominee
does not have discretionary voting power for that proposal and has not received
instructions from the beneficial owner.
Unless contrary instructions are indicated on the proxy, shares
represented by each properly executed and returned proxy card (and not revoked
before they are voted) will be voted "FOR" the election of the nominees for
directors named below, "FOR" the ratification of the appointment of KPMG as the
Company's independent registered public accounting firm for the fiscal year
ending July 31, 2006 and by the proxies in their discretion on any other matters
to come properly before the Meeting, or any postponement or adjournment. If a
stockholder specifies a different choice on the proxy, the stockholder's shares
of Common Stock will be voted according to the specification made.
The entire expense of this proxy solicitation will be borne by the
Company. Solicitation will be made primarily by mail. Proxies may also be
solicited personally and by telephone by regular employees of the Company
without any additional remuneration and at minimal cost. Management may also
request banks, brokerage houses, custodians, nominees and fiduciaries to obtain
authorization for the execution of proxies and may reimburse them for related
expenses. The Company has retained Georgeson Shareholder Communications, Inc. to
assist in soliciting proxies, at an estimated cost of $1,000 plus other
reasonable expenses.
1
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, to the Company's knowledge, the number of
shares of Common Stock beneficially owned on October 26, 2005, unless otherwise
indicated, by (i) each holder who may be deemed to be the beneficial owner of
more than 5% of the Common Stock outstanding (ii) each director and each nominee
for election as a director (iii) each executive officer named in the Summary
Compensation Table and (iv) all directors and executive officers as a group.
There were 17,550,179 shares of Common Stock outstanding on October 26, 2005.
Number of Shares Percent of
Name and Address of Beneficial Owner(1) Beneficially Owned(2) Ownership
---------------------------------------------------------------- --------------------- ---------
Transamerica Investment Management LLC(3) 2,503,243 14.3
1150 South Olive St., Suite 2700
Los Angeles, CA 90015
Waddell & Reed Financial Services(4) 1,656,937 9.4
6300 Lamar Avenue
Shawnee Mission, KS 66201
Kayne Anderson Rudnick Investment Management, LLC(4) 1,368,978 7.8
1800 Avenue of the Stars
Los Angeles, CA 90067
M. A. Weatherbie & Co., Inc.(4) 1,368,187 7.8
265 Franklin Street
Boston, MA 02110
Franklin Resources, Inc. (4) 1,272,732 7.3
One Franklin Parkway
San Mateo, CA 94403
Lateef Management Associates(4) 1,100,160 6.3
300 Drakes Landing Road, Suite 100
Greenbrae, CA 94904
Lawrence B. Fisher(5) 2,000 *
William M. Gallagher(6) 91,226 *
Troy H. Geisser (7) 108,253 *
John V. Golio(8) 130,858 *
Steven F. Groth(9) 95,090 *
William C. MacMillen, Jr. (5) 5,000 *
Michael C. Palitz(10) 270,603 1.6
Thomas F. Robards(1)(1) 6,000 *
Paul R. Sinsheimer(1)(2) 383,799 2.2
Leopold Swergold 0 *
H. E. Timanus, Jr.(5) 16,500 *
Michael J. Zimmerman(1)(3) 6,000 *
All directors and executive officers as a group (15 persons)(14) 1,294,580 7.3
* Less than 1% of Common Stock outstanding.
(1) Unless otherwise indicated, the address of each person listed is c/o
Financial Federal Corporation, 733 Third Avenue, 24th Floor, New York, New
York 10017.
(2) Unless otherwise noted, each person has the sole power to vote, or direct
the voting of, and power to dispose, or direct the disposition of, all
shares. Beneficial ownership was determined according to the rules of the
Securities and Exchange Commission and includes options that are
exercisable or will become exercisable within 60 days of October 26, 2005
and shares of restricted stock subject to forfeiture.
(3) This information is based on a Schedule 13G/A filed September 9, 2005 with
the Securities and Exchange Commission.
2
(4) This information is based on the most recent Forms 13F filed with the
Securities and Exchange Commission.
(5) Holdings are Common Stock only.
(6) Mr. Gallagher's holdings include (i) 54,351 shares of Common Stock (ii)
options to purchase 15,000 shares of Common Stock and (iii) 21,875 shares
of restricted stock subject to forfeiture.
(7) Mr. Geisser's holdings include (i) 24,920 shares of Common Stock (ii)
options to purchase 15,833 shares of Common Stock and (iii) 67,500 shares
of restricted stock subject to forfeiture.
(8) Mr. Golio's holdings include (i) 23,150 shares of Common Stock (ii)
options to purchase 40,833 shares of Common Stock and (iii) 66,875 shares
of restricted stock subject to forfeiture.
(9) Mr. Groth's holdings include (i) 20,435 shares of Common Stock (ii)
options to purchase 10,280 shares of Common Stock and (iii) 64,375 shares
of restricted stock subject to forfeiture.
(10) Mr. Palitz's holdings include (i) 195,847 shares of Common Stock (ii)
options to purchase 5,000 shares of Common Stock (iii) 69,531 shares of
Common Stock held by a corporation owned and controlled by Mr. Palitz and
(iv) 225 shares of Common Stock held by Mr. Palitz's wife.
(11) Mr. Robards' holdings include (i) 1,000 shares of Common Stock and (ii)
options to purchase 5,000 shares of Common Stock.
(12) Mr. Sinsheimer's holdings include (i) 305,227 shares of Common Stock held
by a limited partnership of which the general partner is controlled by Mr.
Sinsheimer and (ii) 78,572 shares of restricted stock subject to
forfeiture. Mr. Sinsheimer also holds 118,056 stock units (55,556 units
are vested) that were not included in his holdings because they are not
considered beneficially owned securities.
(13) Mr. Zimmerman's holdings include (i) 1,000 shares of Common Stock and (ii)
options to purchase 5,000 shares of Common Stock.
(14) Includes (i) 719,186 shares of Common Stock, options to purchase 96,946
shares of Common Stock, 299,197 shares of restricted stock subject to
forfeiture as described in notes 5 through 13 above and (ii) 30,188 shares
of Common Stock, options to purchase 68,438 shares of Common Stock and
80,625 shares of restricted stock subject to forfeiture held by executive
officers not named in the table.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, executive officers and certain beneficial owners of the
Company's equity securities to file reports of holdings of and transactions in
the Company's equity securities with the Securities and Exchange Commission
("SEC") and the New York Stock Exchange, Inc., and to furnish the Company with
copies of all Section 16(a) forms they file. Based solely on a review of copies
of such reports and written representations from the Section 16 reporting
persons, the Company believes for the fiscal year ended July 31, 2005, that its
executive officers, directors and greater than ten percent stockholders filed
all reports due under Section 16(a) of the Securities Exchange Act of 1934
timely except Mr. Fisher inadvertently reported two separate sales of Common
Stock one and two days late.
3
ELECTION OF DIRECTORS
(Item 1 on Proxy Card)
The Corporate Governance and Nominating Committee and the Board of
Directors nominated the persons listed below to serve as directors of the
Company until the next annual meeting and until their respective successors are
elected and qualified, or until their earlier resignation or removal. Mr.
Swergold, who is standing for election to the Board for the first time, was
initially recommended to the Corporate Governance and Nominating Committee as a
possible nominee by Mr. Fisher who is an independent director of the Board and a
security holder. The Company's bylaws set the Board's membership at a minimum of
five directors. On August 16, 2005, the Board of Directors increased the size of
the Board from seven to eight members. As discussed on page 8, William C.
MacMillen, Jr. is retiring from the Board. Therefore, following the Annual
Meeting, there will be one vacancy on the Board.
It is intended that shares represented by proxies solicited by the Board
will, unless authority to vote for some or all nominees is withheld, be voted in
favor of electing as directors the nominees listed below. The Company has no
reason to believe any of the nominees will be disqualified or unable or
unwilling to serve if elected. However, if any nominee becomes unavailable for
any reason, the shares will be voted for another person nominated by the Board,
unless the Board by resolution provides for a lesser number of directors. All
directors who were serving as a director at the time of the 2004 Annual Meeting
of Stockholders attended the 2004 meeting. Directors are encouraged to attend
each Annual Meeting of Stockholders. All nominees listed below are directors of
the Company.
Electing the seven director nominees requires an affirmative vote by a
plurality of votes cast at the meeting of stockholders by the stockholders
entitled to vote in the election. Shares not voted (by abstention, broker
non-vote, or otherwise) will not impact the vote.
The Board of Directors recommends stockholders vote "FOR" each of the
nominees listed below.
Nominees for Election as Directors
The name, age, principal occupation or employment, and other data
regarding each nominee, based on information received from the respective
nominees, are set forth below:
Lawrence B. Fisher, 67, has served as a director of the Company since
1992. Mr. Fisher has been a partner of Orrick, Herrington & Sutcliffe LLP, a law
firm, since December 1995. He was formerly a partner of Kelley Drye & Warren
LLP, a law firm, from 1985 to December 1995. He is a member of the Board of
Directors of National Bank of New York City, a privately owned commercial bank
and he is a member of the Board of Directors of Coastal Bancshares Acquisition
Corp., a publicly held company organized to acquire a bank.
Michael C. Palitz, 47, has served as a director of the Company since July
1996. He is a Managing Director of Preston Partners LLC, a Manhattan based
merchant banking firm. He served as an Executive Vice President of the Company
from July 1995 until he resigned as an officer and employee of the Company on
March 14, 2003. Mr. Palitz served as a Senior Vice President of the Company from
February 1992 to July 1995 and served as a Vice President of the Company from
its inception in 1989 to February 1992. He has also served as Treasurer and
Assistant Secretary of the Company since its inception in 1989 and as Chief
Financial Officer from 1989 through September 2000. He is a member of the Board
of Directors and Chair of the Audit Committee of City and Suburban Financial
Corporation.
Thomas F. Robards, 59, has served as a director of the Company since 2000
and is a principal of Robards & Co LLC. From January 2003 to June 2004, Mr.
Robards was the Chief Financial Officer and a Senior Vice President of the
American Museum of Natural History, New York, New York. From April 2000 to
September 2002, Mr. Robards was the Chief Financial Officer of Datek Online
Holdings Corp., until it was acquired by Ameritrade Holding Corp. From 1976 to
December 1999, he worked for Republic New York Corporation until it was acquired
by HSBC Banking Corp. He served as its Chief Financial Officer from March 1995
to March 1999 and as a director from 1998 to March 1999. He is a member of the
Board of Directors and Chair of the Audit Committee of Overseas Shipholding
Group, Inc. and he is a member of the Board of Directors and Chair of the Audit
Committee of HSBC Investor Funds, a mutual fund complex.
4
Paul R. Sinsheimer, 58, has served as Chairman of the Board and Chief
Executive Officer of the Company since December 2000, as President of the
Company since September 1998, as an Executive Vice President of the Company from
its inception in 1989 to September 1998 and as a director of the Company since
its inception. From 1970 to 1989, Mr. Sinsheimer worked for Commercial Alliance
Corporation in several positions including Executive Vice President.
Leopold Swergold, 65, has served as a director of the Company since August
16, 2005. Mr. Swergold is the sole member of Anvers Management LLC, a general
partner of two private equity funds. Mr. Swergold was a Managing Director at ING
Groep N.V. from 1997 until he retired in December 2004. He was Head of
Healthcare Investment Banking and a member of the Board of Directors of Furman
Selz from 1989 until it was acquired by ING Groep N.V. in 1997. After working on
Wall Street for twenty years, Mr. Swergold formed his own investing banking firm
in 1983 that later merged into Furman Selz in 1989. Mr. Swergold served as a
Governor and Chair of the Audit Committee of the National Association of
Securities Dealers ("NASD") from 1989 to 1992. He is a member of the Board of
Directors of Select Medical Corporation.
H. E. Timanus, Jr., 60, has served as a director of the Company since
1999. Mr. Timanus is the Chairman of the Board and Chief Operating Officer of
Prosperity Bank, Houston, Texas; Executive Vice President and Chief Operating
Officer of Prosperity Bancshares, Inc., Houston, Texas; and Executive Vice
President and Chief Operating Officer of Prosperity Holdings, Inc., Wilmington,
Delaware. He was Chairman of the Board and Chief Executive Officer of Heritage
Bank, Houston, Texas, which merged into Prosperity Bank; President and Chief
Executive Officer of Commercial Bancshares, Inc., Houston, Texas, which merged
into Prosperity Bancshares, Inc.; and President and Chief Executive Officer of
Heritage Bancshares, Inc., Wilmington, Delaware, which merged into Prosperity
Holdings, Inc. Mr. Timanus began his career with Commercial Bancshares, Inc. in
1982.
Michael J. Zimmerman, 55, has served as a director of the Company since
June 7, 2004. Mr. Zimmerman is Executive Vice President and Chief Financial
Officer of ContiGroup Companies, Inc. and President of its ContiInvestments
subsidiary. Before joining ContiGroup in 1996, Mr. Zimmerman was a Managing
Director at Salomon Brothers, where he served in various senior positions in the
investment banking and firm investment areas. He is a member of the Board of
Directors of Overseas Shipholding Group, Inc, where he serves as non-executive
Chairman, and is Chairman of Premium Standard Farms, a majority-owned affiliate
of ContiGroup.
Independent and Non-Management Directors
The Board of Directors affirmatively determined that each member of the
Board other than Mr. Sinsheimer (who is the Chief Executive Officer) and Mr.
Palitz (who is a non-management director) meets the independence criteria
established by the New York Stock Exchange for independent board members. The
Board also affirmatively determined that no material relationships exist between
the Company and any of the independent directors that would interfere with their
judgment in carrying out their responsibilities as a director. In evaluating Mr.
Fisher's independence, the Board examined the Company's business relationship
with Orrick, Herrington & Sutcliffe LLP ("Orrick"). The Company has retained
Orrick for various legal matters. Mr. Fisher is a partner of Orrick. The Board
considered that the Company's payments to Orrick were substantially less than
one percent of the firm's annual revenues and were well within the applicable
numerical thresholds set forth in the New York Stock Exchange Corporate
Governance rules for classifying directors as independent. The Board determined
that the relationship between the Company and Orrick does not interfere with Mr.
Fisher's exercise of independent judgment. In addition, the Board of Directors
determined that the members of the Audit Committee meet the additional
independence criteria required for audit committee membership.
The non-management directors meet regularly each year without any
management directors or employees present. If the meeting is in conjunction with
a committee meeting, the respective chair of the committee that is meeting acts
as the presiding director. If the meeting is not in conjunction with a committee
meeting, the non-management directors rotate acting as the presiding director.
In addition, the independent directors meet without any of the other directors
present at least once each year. Interested parties may communicate with
non-management directors in the manner described in the section "Communications
with the Board of Directors" on page 7.
5
Board of Directors Meetings and Committees
The Board established an Executive Committee, currently consisting of four
directors. The Executive Committee can exercise all the powers of the Board
between meetings of the Board. The current members of the Executive Committee
are Messrs. Fisher, Palitz, Robards and Sinsheimer.
The Board established an Audit Committee, currently consisting of three
independent directors. The Audit Committee is responsible for monitoring (i) the
integrity of the financial statements of the Company (ii) the independent
registered public accounting firm's qualifications and independence (iii) the
performance of the Company's internal audit function and independent registered
public accounting firm and (iv) the compliance by the Company with legal and
regulatory requirements. The Audit Committee is also responsible for engaging
the Company's independent registered public accounting firm. The Audit Committee
also establishes procedures for (i) the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal accounting
controls or auditing matters, and for (ii) the confidential, anonymous
submission by employees of concerns regarding questionable accounting or
auditing matters. The Audit Committee acts under a written charter approved by
the Board. The charter is available in the Investor Relations section of the
Company's website under Corporate Governance at http://www.financialfederal.com.
The current members of the Audit Committee are Messrs. Robards, Timanus and
Zimmerman. Mr. Robards is the Chair of the Audit Committee. Upon consideration
of the attributes of an audit committee financial expert set forth in Item
401(h) of Regulation S-K promulgated by the SEC, the Board determined Mr.
Robards possesses these attributes through his experience as Chief Financial
Officer of the American Museum of Natural History, Datek Online Holdings Corp.
and Republic New York Corporation, and he is designated as the Audit Committee
financial expert. In addition, the Board also determined Mr. Zimmerman possesses
the attributes of an audit committee financial expert through his experience as
the Chief Financial Officer of ContiGroup Companies, Inc.
The Board established an Executive Compensation and Stock Option
Committee, currently consisting of four independent directors. The Executive
Compensation and Stock Option Committee reviews and approves the goals,
objectives and performance relevant to the Chief Executive Officer's
compensation and determines such compensation including any equity compensation
awards. The Executive Compensation and Stock Option Committee similarly reviews
and approves the goals, objectives and performance relevant to the compensation
for executive officers who report to the Chief Executive Officer and determines
their compensation including any equity compensation awards. The Executive
Compensation and Stock Option Committee also administers the Company's 2001
Management Incentive Plan (the "MIP") and the Amended and Restated 1998 Stock
Option/Restricted Stock Plan (the "1998 Plan"). The Executive Compensation and
Stock Option Committee is responsible for approving appointments and promotions
between meetings of the full Board and these committee actions must be ratified
by a majority vote of the Board within six months to remain effective. The
Executive Compensation and Stock Option Committee acts under a written charter
approved by the Board. The charter is available in the Investor Relations
section of the Company's website under Corporate Governance. The current members
of the Executive Compensation and Stock Option Committee are Messrs. Robards,
Swergold, Timanus and Zimmerman. Mr. Robards is the Chair of the Committee.
The Board established a Corporate Governance and Nominating Committee,
currently consisting of five independent directors. The Corporate Governance and
Nominating Committee is responsible for nominating qualified candidates for
appointments to the Board, recommending to the Board the code of business
conduct and ethics and corporate governance guidelines for the Company and for
overseeing the evaluation of the Board and management. The Board-approved code
of business conduct and ethics and corporate governance guidelines are available
in the Investor Relations section of the Company's website under Corporate
Governance. The Corporate Governance and Nominating Committee acts under a
written charter approved by the Board. The charter is available in the Investor
Relations section of the Company's website under Corporate Governance. The
current members of the Corporate Governance and Nominating Committee are Messrs.
Fisher, Robards, Swergold, Timanus and Zimmerman. Mr. Timanus is the Chair of
the Committee.
The Corporate Governance and Nominating Committee annually recommends
director nominations and annually reviews the appropriate skills and
characteristics required of Board members in the context of the current
composition of the Board, the operating requirements of the Company and the
long-term interests of stockholders. In conducting this assessment, the
Corporate Governance and Nominating Committee focuses on a candidate's financial
expertise and finance company experience and considers knowledge, skills,
experience in business, administration and relevant technical disciplines,
social experience and other appropriate factors given the current needs of the
Board and the Company, to maintain a balance of
6
knowledge, experience and capability. Nominees for the Board should have the
highest personal and professional ethics, integrity and values and be committed
to representing the long-term interests of stockholders. They should be
inquisitive and objective and exhibit practical judgment on issues. The
Corporate Governance and Nominating Committee may engage consultants or
third-party search firms to assist in identifying and evaluating potential
nominees. In fiscal 2005, the Corporate Governance and Nominating Committee
engaged a third-party service provider to assist in the due diligence process
for the candidate-nominees for director.
In recommending candidates for election to the Board, the Corporate
Governance and Nominating Committee considers nominees recommended by directors,
officers, employees, stockholders and others, using the same criteria to
evaluate all candidates. Evaluation of candidates generally involves reviewing
background materials, internal discussions and interviewing selected candidates
as appropriate. Upon selecting a qualified candidate, the Corporate Governance
and Nominating Committee recommends the candidate for the Board's consideration.
Stockholders may recommend a nominee by writing to the Company's Secretary
specifying the nominee's name and qualifications for Board membership. All
recommendations are submitted to the Corporate Governance and Nominating
Committee. Each submission must include (i) a brief description of the candidate
(ii) the candidate's name, age, business address and residence address (iii) the
candidate's principal occupation and the number of shares of Common Stock
beneficially owned and (iv) any other information required by the rules of the
SEC to list the candidate as a nominee for director in a proxy statement.
Recommended candidates may be required to provide additional information.
During the Company's fiscal year ended July 31, 2005, the Board of
Directors met eight times, the Executive Committee did not meet, the Audit
Committee met five times, the Executive Compensation and Stock Option Committee
met six times and the Corporate Governance and Nominating Committee met four
times. Each current director attended, either in person or telephonically, at
least 90% of the total number of meetings of the Board and its committees of
which they were members during fiscal 2005. The Board has no other standing
committees.
Communications with the Board of Directors
Stockholders may communicate with the Company's Board of Directors through
the Company's Secretary by writing to the following address: Board of Directors,
c/o Secretary, Financial Federal Corporation, 733 Third Avenue, 24th Floor, New
York, New York 10017. The Company's Secretary will forward all correspondence to
the Board, except for spam, junk mail, mass mailings, product complaints or
inquiries, job inquiries, surveys, business solicitations or advertisements, or
patently offensive or inappropriate material. The Company's Secretary may
forward certain correspondence, such as product-related inquiries, elsewhere
within the Company for review and possible response.
Interested parties may report any concerns to the non-management directors
confidentially or anonymously by writing direct to the Chair of the Corporate
Governance and Nominating Committee c/o Financial Federal Corporation, 733 Third
Avenue, 24th Floor, New York, New York 10017. These communications will be
reviewed and any concerns relating to accounting, internal control or auditing
will be forwarded to the Chair of the Audit Committee.
Compensation Committee Interlocks and Insider Participation
Messrs. William C. MacMillen, Jr., Robards, Timanus and Zimmerman served
as members of the Executive Compensation and Stock Option Committee during
fiscal 2005. They have no relationship with the Company other than as directors
and securityholders. No member of the Executive Compensation and Stock Option
Committee is or was an officer or an employee of the Company. During fiscal
2005, no executive officer of the Company served as a director, or as a member
of any compensation committee, of any other entity that had an executive officer
that served on the Board of Directors or Executive Compensation and Stock Option
Committee of the Company.
7
Compensation of Directors
Directors who are not officers or employees of the Company or any of its
subsidiaries receive stipends, as follows:
1. Annual stipend of $35,000 payable on their election by the stockholders
after the annual meeting of stockholders each year. If a director joins
the Board during the year, the stipend will be pro rated.
2. Additional annual stipend of $5,000 to the Audit Committee Chair,
$3,000 to the Executive Compensation and Stock Option Committee Chair
and $2,000 to the Corporate Governance and Nominating Committee Chair.
3. Additional stipend of $1,000 for each Board meeting attended.
4. Additional stipend of $1,000 for each committee meeting attended.
The Company does not have a formal policy of granting stock options to
directors but the Board may make discretionary grants under the 1998 Plan.
Current directors were each granted a nonqualified stock option shortly after
joining the Board as an outside director to purchase 5,000 shares of Common
Stock at the fair market value on the date of grant. No stock options were
granted to outside directors during fiscal 2005.
Directors who are officers of the Company receive no additional
compensation upon election to the Board or for attending Board or committee
meetings.
Director Emeritus
William C. MacMillen, Jr., who has served as a director of the Company
since 1989, notified the Board of Directors he intends to retire at the end of
his current term. Recognizing Mr. MacMillen's long-standing contributions to the
Company and exemplary service, the Board of Directors determined the Company
would benefit from a continued association with Mr. MacMillen and appointed him
a director emeritus effective as of the close of the 2005 Annual Meeting. As a
director emeritus, Mr. MacMillen (i) will serve at the pleasure of the Board of
Directors (ii) may attend meetings of the Board of Directors but may not vote
(iii) may be invited to attend meetings of the committees of the Board of
Directors but may not vote (iv) will not have responsibility for the actions of
the Board or its committees (v) will receive annual compensation of $35,000 plus
reimbursement of related travel expenses and (vi) will be indemnified in his
role as a director emeritus.
8
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning the annual and
long-term compensation paid to those persons who were, at July 31, 2005, the
Chief Executive Officer ("CEO") and the other four most highly compensated
executive officers of the Company.
Annual Long-term Compensation
Compensation ($) Awards
------------------ ---------------------------
Restricted Securities
Fiscal Stock Underlying All Other
Name and Principal Position(s) Year Salary Bonus Award (1) ($) Options (#) Compensation ($)
------------------------------ ---- ------- ------- ------------- ----------- ----------------
Paul R. Sinsheimer 2005 750,000 0 708,042 0 0
CEO, President and 2004 750,000 530,000 369,700 0 0
Chairman 2003 750,634 508,375 0 0 0
John V. Golio 2005 307,500 0 0 10,000 0
Executive Vice President 2004 300,000 0 156,500 0 0
2003 303,416 0 0 0 0
William M. Gallagher 2005 297,500 0 187,600 0 0
Senior Vice President 2004 290,000 0 156,500 0 0
2003 290,633 0 0 0 0
Steven F. Groth 2005 290,000 0 375,200 0 0
Senior Vice President and 2004 280,000 0 156,500 0 0
Chief Financial Officer 2003 293,548 0 0 0 0
Troy H. Geisser 2005 287,500 0 0 10,000 0
Senior Vice President 2004 280,000 0 626,000 0 0
and Secretary 2003 291,135 0 0 0 0
(1) These amounts were calculated by multiplying the number of shares of
restricted stock granted by the fair market value of the Common Stock on
the date of the award. Shares of restricted stock were granted to Mr.
Sinsheimer under the MIP as follows: 17,790 in September 2005 and 10,000
in October 2004. These grants represented Mr. Sinsheimer's fiscal 2005 and
2004 bonuses, respectively. These shares vest yearly in equal amounts over
four and five years of service, respectively. In March 2005, Mr. Gallagher
was granted 5,000 shares of restricted stock and Mr. Groth 10,000 shares
of restricted stock under the 1998 Plan. Mr. Gallagher's shares vest
yearly in equal amounts over five years of service and Mr. Groth's shares
vest yearly in equal amounts over eight years of service. In April 2004,
shares of restricted stock were granted under the 1998 Plan as follows:
Mr. Golio - 5,000; Mr. Gallagher - 5,000; Mr. Groth - 5,000 and Mr.
Geisser - 20,000. These shares vest yearly in equal amounts over eight
years of service.
All shares of restricted stock and stock units granted are subject to
earlier vesting upon a sale of the Company or a qualifying termination of
employment. Dividends on Common Stock are payable on shares of restricted
stock. The aggregate holdings and values (based on the $38.50 fiscal
year-end closing price of the Common Stock) of shares of restricted stock
and unvested stock units at July 31, 2005 follow: Mr. Sinsheimer - 125,282
shares and units ($4,823,357), Mr. Golio - 66,875 shares ($2,574,688); Mr.
Gallagher - 21,875 shares ($842,188); Mr. Groth - 64,375 shares
($2,478,438) and Mr. Geisser - 67,500 shares ($2,598,750).
In November 2005, 27,500 shares of restricted stock were granted to Mr.
Sinsheimer under the MIP as part of his bonus for fiscal 2006 (see page 11
for further discussion).
9
Option Grants In Last Fiscal Year (1)
Individual Grants
---------------------------------------------------------------------
Number of
Shares % of Total Grant
Underlying Options Exercise Date
Options Granted to Price Expiration Present
Name (2) Granted (#) Employees Per Share ($) Date Value (3) ($)
--------------------- ----------- ---------- ------------- ---------- -------------
Paul R. Sinsheimer 0 -- -- -- --
John V. Golio 10,000 9.43 37.52 03/16/2009 78,900
William M. Gallagher 0 -- -- -- --
Steven F. Groth 0 -- -- -- --
Troy H. Geisser 10,000 9.43 37.52 03/16/2009 78,900
(1) No stock appreciation rights were granted to any named executive officer
in fiscal 2005.
(2) Includes those who were the Chief Executive Officer and the four other
most highly compensated executive officers in fiscal 2005.
(3) According to SEC rules, the Black-Scholes option pricing model was used to
estimate grant date present value. The Company does not endorse the
accuracy of this option pricing model. Stock option pricing models require
predictions of future stock price changes. The following assumptions were
made to calculate grant date present value: expected life - 2.8 years,
expected volatility - 27%, risk-free interest rate - 3.9% and dividend
yield - 1.3%.
Aggregated Option Exercises In Last Fiscal Year
And Fiscal Year-End Option Value
Number of
Securities Underlying Value of Unexercised
Shares Unexercised Options Held In-the-Money Options
Acquired on Value At July 31, 2005 (#) At July 31, 2005 (2) ($)
Name Exercise (#) Realized (1) ($) Exercisable Unexercisable Exercisable Unexercisable
--------------------- ------------ ---------------- ----------- ------------- ----------- -------------
Paul R. Sinsheimer 0 0 0 0 0 0
John V. Golio 12,500 254,688 40,833 19,167 562,016 192,784
William M. Gallagher 11,000 206,305 15,000 5,000 223,500 74,500
Steven F. Groth 11,660 196,616 10,280 2,500 177,787 37,250
Troy H. Geisser 28,250 402,069 15,833 19,167 189,516 192,784
(1) The value realized is the difference between the closing price of the
Company's Common Stock on the day of exercise and the exercise price of
the options, multiplied by the number of shares acquired on exercise, and
does not necessarily indicate that the named executive officer sold the
acquired shares.
(2) Value is the difference between the $38.50 closing price of the Company's
Common Stock at its fiscal year-end and the exercise price of the options,
multiplied by the number of shares that can be acquired on exercise. All
options held by the named executive officers were in-the-money at July 31,
2005.
10
REPORT OF THE EXECUTIVE COMPENSATION AND STOCK OPTION COMMITTEE
The Executive Compensation and Stock Option Committee (the "Committee") is
pleased to present its report on executive compensation. The current members of
the Committee are Thomas F. Robards, Leopold Swergold, H. E. Timanus, Jr., and
Michael J. Zimmerman. Each member of the Committee is an independent director of
the Company. This report to stockholders presents an overview of the role of the
Committee and of the Company's present compensation philosophy. The Committee
reviews and approves the goals, objectives and performance relevant to the Chief
Executive Officer's compensation and determines such compensation including any
equity compensation awards. The Committee similarly reviews and approves the
goals, objectives and performance relevant to the compensation for the executive
officers who report to the Chief Executive Officer and determines their
compensation including any equity compensation awards.
The Committee's philosophy is to link a significant portion of executive
compensation directly to the Company's success in meeting profit, growth and
other corporate performance goals, operating efficiencies, success in handling
non-performing assets, the Company's overall performance regarding its return on
earning assets and average equity, and the quality and integrity of the
Company's receivables. The Company compensates officers through salary and
through grants of shares of restricted stock, stock units and stock options. The
Committee believes granting restricted stock, stock units and stock options to
officers and other employees further aligns their objectives with those of the
Company and its stockholders. The Committee, in its discretion, determines the
proportion of the equity awards to grant to officers and other employees to
maximize long-term incentives.
The Committee reviews the Company's compensation programs and consults
with independent experts to ensure the compensation and benefits offered to
executive officers are competitive and reflect the Company's performance. To
attract and retain high caliber employees and executives, the Company offers
competitive salaries and long-term incentives compared to other financial
services companies of similar size.
The Committee's compensation evaluation procedures also include reviewing
public filings of other financial services companies and performing an informal
survey as well as a comparison and review of its competitors and other
companies. The Committee, in establishing compensation for the CEO, generally
uses the same criteria it uses for other officers and employees and also
provides the CEO with an annual bonus opportunity. Competitive CEO pay practices
were assessed using proxy statements of a comparison group of publicly traded
financial institutions and a report by an independent compensation consultant as
well as its proprietary database of compensation survey sources.
Compensation of the Chief Executive Officer
The CEO's annual rate of salary for fiscal 2005 was $750,000. In October
2004, the Committee established a fiscal 2005 bonus opportunity for the CEO
under the MIP. The potential bonus amount, if any, was based on fiscal 2005
diluted earnings per share ("EPS"). The calculated amount could then be reduced
in the Committee's discretion. Any bonus earned would be delivered in shares of
restricted stock (valued using the Company's fiscal 2004 year-end closing share
price of $32.16) vesting yearly in equal amounts over four years of service
subject to earlier vesting upon a sale of the Company or a qualifying
termination of employment. A maximum of 31,095 shares of restricted stock could
have been delivered to the CEO. Based on the Company's diluted EPS for fiscal
2005, the Committee awarded the CEO a $572,172 bonus delivered by a grant of
17,790 shares of restricted stock in September 2005.
In October 2005, the Committee established a performance-based annual cash
bonus and a long-term equity incentive award under the MIP for the CEO for
fiscal 2006, and the Committee and the CEO agreed to reduce prospectively the
CEO's annual salary by $100,000 to $650,000 so that a greater portion of his
compensation would be linked directly to the successful achievement of Company
performance objectives. The CEO is eligible to earn an annual performance-based
cash bonus ranging from $0 to a maximum of $800,000 for fiscal 2006 and the
Committee granted an equity award of 27,500 shares of restricted stock to the
CEO. The number of shares of restricted stock the CEO will be permitted to
retain (subject to time-based vesting) will range from zero to 27,500. The
potential cash bonus amount and the potential shares of restricted stock the CEO
can retain will be determined by a performance matrix established by the
Committee in October 2005 based on the Company's diluted earnings per share for
fiscal 2006. The cash bonus and shares determined by the performance matrix may
then be reduced by the Committee's discretion. Shares of restricted stock
retained by the CEO will vest yearly in equal amounts over four years of
service. Payment of up to $400,000 of the cash bonus and vesting of the shares
of restricted stock are subject to acceleration upon a sale of the Company or a
qualifying termination of employment.
11
Policy on Compensation Deductibility
Section 162(m) of the Internal Revenue Code limits a corporation's tax
deduction of compensation paid to each of its CEO and the four executive
officers named in the Summary Compensation Table to $1.0 million in a fiscal
year. However, compensation meeting the Internal Revenue Code's definition of
"performance-based" is excluded from this limit. The Committee endeavors to
achieve maximum deductibility of compensation paid, but may authorize
compensation not fully deductible under Section 162(m) to offer competitive
compensation. The Committee believes awards to the CEO under the stockholder
approved MIP and awards of options to the named executives under the stockholder
approved 1998 Plan qualify as performance-based compensation and are excludable
from the $1.0 million limit.
This report is submitted by the members of the Executive Compensation and
Stock Option Committee of the Board of Directors:
Thomas F. Robards
Leopold Swergold
H. E. Timanus, Jr.
Michael J. Zimmerman
12
STOCK PERFORMANCE GRAPH
The following graph compares the percentage change in cumulative total
stockholder return on Financial Federal Corporation's Common Stock during the
five-year period ending July 31, 2005 with the cumulative total return on the
Russell 2000 Index and on the S&P Financial Index. The comparison assumes $100
was invested on July 31, 2000 in each index. Note that historical stock price is
not indicative of future stock price performance. All amounts were calculated as
if all dividends were reinvested.
[LINE GRAPH]
7/00 7/01 7/02 7/03 7/04 7/05
----- ----- ----- ----- ----- -----
Financial Federal Corporation 100.0 134.1 146.9 153.4 162.8 196.5
Russell 2000 100.0 98.3 80.6 99.3 116.2 145.0
S&P Financials 100.0 109.9 92.0 104.8 117.1 128.4
Copyright (C) 2005, Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
All rights reserved. www.researchdatagroup.com/S&P.htm
The Stock Performance Graph shall not be deemed incorporated by reference
by any general statement incorporating by reference this Proxy Statement into
any filing under the Securities Act of 1933, or the Securities Exchange Act of
1934, except to the extent the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
13
CERTAIN TRANSACTIONS
The Company's Chairman, Chief Executive Officer and President, Paul R.
Sinsheimer and Michael C. Palitz, a director of the Company (including their
affiliates) held $1,176,613.36 and $5,136,780.03, respectively, of the Company's
commercial paper at July 31, 2005. The Company issued this debt at prevailing
interest rates and on customary terms. Mr. Fisher, a director of the Company, is
a partner of Orrick, a law firm the Company has retained for various legal
matters.
AUDIT COMMITTEE REPORT
The current members of the Audit Committee are Thomas F. Robards, H. E.
Timanus, Jr. and Michael J. Zimmerman. Each meets the independence and
experience requirements of the New York Stock Exchange, Section 10A(m)(3) of the
Exchange Act and the rules and regulations of the SEC. The Audit Committee acts
under a written charter approved by the Board of Directors.
Management is responsible for the Company's internal control over
financial reporting and the financial reporting process. The Company's
independent registered public accounting firm, KPMG, is responsible for the
integrated audit of the Company's consolidated financial statements and internal
control over financial reporting. The Audit Committee's responsibility is to
monitor and oversee these processes. The Audit Committee relies on the
independent registered public accounting firm's opinions on the consolidated
financial statements and the effectiveness of internal control over financial
reporting. The Audit Committee pre-approves all fees charged and work performed
by KPMG.
The Audit Committee reviewed and discussed the Company's audited
consolidated financial statements for fiscal 2005 with the Company's management.
The Audit Committee also discussed the matters required by Statement on Auditing
Standards No. 61, "Communication with Audit Committees" with KPMG.
KPMG provided the Audit Committee with the written disclosure required by
Independence Standards Board Standard No. 1, "Independence Discussions with
Audit Committees." The Audit Committee discussed with KPMG its independence from
the Company and management. KPMG did not perform any non-audit services for the
Company during fiscal 2005.
Based on the Audit Committee's review and discussions noted above, the
Audit Committee recommended to the Board (and the Board approved) that the
Company's audited financial statements be included in the Company's Annual
Report on Form 10-K for the year ended July 31, 2005, for filing with the SEC.
This report is submitted by the members of the Audit Committee of the
Board of Directors:
Thomas F. Robards
H. E. Timanus, Jr.
Michael J. Zimmerman
14
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
(Item 2 on Proxy Card)
General
The Audit Committee appointed KPMG as the Company's independent registered
public accounting firm for the fiscal year ending July 31, 2006. KPMG has
audited the Company's financial statements since fiscal 2002. A representative
of KPMG is expected to attend the Meeting and will have an opportunity to make a
statement and be available to respond to appropriate questions.
Stockholder ratification of the appointment of the Company's independent
registered public accounting firm is not required by the Company's bylaws or
other applicable legal requirements. However, the Board is submitting the
appointment of KPMG to stockholders for ratification as good corporate practice.
If stockholders do not ratify the appointment, the Audit Committee will
reconsider retaining KPMG. If stockholders ratify the appointment, the Audit
Committee may appoint a different independent registered public accounting firm
at any time if it determines a change would be in the best interests of the
Company and its stockholders.
Ratification of the appointment of the Company's independent registered
public accounting firm requires a majority of the votes cast. Abstentions will
be treated as a vote against the proposal. Broker non-votes will not be counted.
Principal Accounting Fees and Services
For the fiscal years ended July 31, 2005 and 2004, the fees related to
services performed by KPMG follow:
Fee Category Fiscal 2005 Fiscal 2004
------------------- ----------- -----------
Audit Fees $685,000 $425,000
Audit-Related Fees 0 78,500
Tax Fees 0 0
All Other Fees 0 58,000
-------- --------
Total Fees $685,000 $561,500
======== ========
Audit Fees: Audit fees include fees paid for the annual audit of the
Company's consolidated financial statements, the audit of management's
assessment of internal control over financing reporting in fiscal 2005 (required
by Section 404 of the Sarbanes-Oxley Act of 2002), the audit of subsidiary
consolidated financial statements and reviews of the Company's quarterly
consolidated financial statements. Audit fees also include fees for services
closely related to the audit that primarily could only be provided by the
Company's independent registered public accounting firm. These services include
consents related to SEC registration statements.
Audit-Related Fees: For fiscal 2004, audit related services were provided
for a comfort letter related to filing a Form S-3 registration statement for
convertible debentures and advisory services related to Section 404 of the
Sarbanes-Oxley Act of 2002. No audit related services were provided to the
Company for fiscal 2005.
Tax Fees: No tax compliance, tax advice or tax planning services were
provided to the Company for fiscal 2005 and fiscal 2004.
All Other Fees: All other services consist of fees for products and
services other than the services reported above. For fiscal 2004, services were
provided for an agreed-upon procedures report required by one of the Company's
debt agreements. No other services were provided for fiscal 2005.
Pre-Approval Policy and Procedures
The Audit Committee's policy is to pre-approve all audit and permissible
non-audit services provided by the independent registered public accounting
firm. Permissible non-audit services include audit-related services, tax
services and other services. The independent registered public accounting firm
and management are required to report periodically to the Audit Committee
services provided by the independent registered public accounting firm according
to this pre-approval, and the fees for these services.
The Board of Directors recommends stockholders vote "FOR" the ratification
of the appointment of KPMG LLP as the Company's independent registered public
accounting firm for the fiscal year ending July 31, 2006
15
STOCKHOLDER PROPOSALS
As a stockholder, you may be entitled to present proposals for action at a
forthcoming meeting if you comply with the requirements of the proxy rules
established by the SEC. All proposals of stockholders to be presented for
consideration at the Company's next Annual Meeting of Stockholders, expected to
be held December 12, 2006, must be directed to the Secretary of the Company at
the Company's principal executive office and, to be considered for possible
inclusion in the Proxy Statement and form of proxy for such Annual Meeting of
Stockholders according to the rules and regulations of the SEC, must be received
by July 12, 2006.
The attached proxy card grants the proxy holders discretionary authority
to vote on any matter raised at the Meeting. If you intend to submit a proposal
at the Company's next Annual Meeting of Stockholders, that is not eligible to be
included in the Proxy Statement and form of proxy relating to that meeting, you
must do so by September 25, 2006. If you fail to comply with this notice
provision, the proxy holders will be allowed to use their discretionary voting
authority when the proposal is raised at the Company's next Annual Meeting of
Stockholders, without any discussion of the matter in the Proxy Statement.
OTHER BUSINESS
As of the date of this Proxy Statement, neither the Company nor the Board
of Directors know of any matters, other than those indicated above, to be
presented at the Meeting. If any additional matters are properly presented, the
persons named in the proxy will have discretion to vote the shares represented
by such proxy.
ANNUAL REPORT
THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS FOR THE FISCAL YEAR ENDED JULY 31,
2005 WAS MAILED WITH THE PROXY STATEMENT AND IS AVAILABLE ON THE INTERNET IN THE
INVESTOR RELATIONS SECTION OF THE COMPANY'S WEBSITE AT
HTTP://WWW.FINANCIALFEDERAL.COM. ADDITIONAL COPIES OF THE ANNUAL REPORT MAY BE
OBTAINED BY CALLING THE COMPANY AT (212) 599-8000. ON RECEIVING A WRITTEN
REQUEST, THE COMPANY WILL ALSO PROVIDE TO ANY STOCKHOLDER, WITHOUT CHARGE, A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR FISCAL 2005 FILED WITH THE
SEC UNDER THE SECURITIES EXCHANGE ACT OF 1934. WRITTEN REQUESTS SHOULD BE SENT
TO INVESTOR RELATIONS AT FINANCIAL FEDERAL CORPORATION, 733 THIRD AVENUE, NEW
YORK, NY 10017.
BY ORDER OF THE BOARD OF DIRECTORS
Troy H. Geisser
Secretary
DATE: November 9, 2005
FINANCIAL FEDERAL CORPORATION PROXY
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF ALL NOMINEES AND FOR PROPOSAL 2.
1. Election of Directors
Nominees: Lawrence B. Fisher Michael C. Palitz Thomas F. Robards
Paul R. Sinsheimer Leopold Swergold H.E. Timanus, Jr.
Michael J. Zimmerman
[ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY to
above (except as marked vote for all nominees
to the contrary) listed above
INSTRUCTIONS: To withhold authority for an individual nominee, strike a
line through that nominee's name.
2. Ratifying the appointment of KPMG LLP as the Corporation's independent
registered public accounting firm for the fiscal year ending July 31, 2006.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued on reverse side)
FINANCIAL FEDERAL CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING TO BE HELD ON DECEMBER 13, 2005
The undersigned stockholder of Financial Federal Corporation (the "Corporation")
hereby appoints Paul R. Sinsheimer and Troy H. Geisser, or either of them,
with full power of substitution, as proxies for the undersigned to attend and
act for and on behalf of the undersigned at the Annual Meeting of Stockholders
of the Corporation to be held at 270 Park Avenue, New York, New York on December
13, 2005 at 10:00 a.m., and at any adjournment thereof, to the same extent and
with the same power as if the undersigned were present in person thereat and
with authority to vote and act in such proxyholder's discretion with respect to
other matters which may properly come before the Meeting. Such proxyholder is
specifically directed to vote or withhold from voting the shares registered in
the name of the undersigned as indicated on the reverse side.
Dated: , 2005
---------------------------
-----------------------------------------
(Signature)
-----------------------------------------
(Signature, if held jointly)
The signature on this Proxy should correspond
exactly with stockholder's name as printed to
the left. In the case of joint tenancies,
co-executors, or co-trustees, both should sign.
Persons signing as Attorney, Executor, Trustee,
Administrator or Guardian should give their
full title.
Please Mark, Sign, Date and Return this Proxy Card Promptly Using the Enclosed
Envelope.