SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
NETWORK EVENT THEATER, 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 security to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] 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:
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(2) Form, Schedule or Registration Statement no.:
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(3) Filing Party:
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(4) Date Filed:
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NETWORK EVENT THEATER, INC.
529 Fifth Avenue
New York, New York 10017
April 13, 1998
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders of
Network Event Theater, Inc., a Delaware corporation (the "Company"), to be held
on Tuesday, May 19, 1998 at 3:00 p.m., Eastern Standard Time, at the offices of
Proskauer Rose LLP, 1585 Broadway, New York, New York.
At this meeting, you will be asked to consider and vote upon an amendment
to the Company's Certificate of Incorporation to increase the number of shares
of common stock that the Company is authorized to issue from 17 million shares
to 32 million shares.
YOUR VOTE IS IMPORTANT. The Board of Directors appreciates and encourages
stockholder participation in the Company's affairs and cordially invites you to
attend the meeting in person. It is important in any event that your shares be
represented and we ask that you sign, date and mail the enclosed proxy card in
the envelope provided at your earliest convenience.
We sincerely thank you for your support.
Very truly yours,
Harlan D. Peltz
Chairman of the Board and
Chief Executive Officer
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NETWORK EVENT THEATER, INC.
529 Fifth Avenue
New York, New York 10017
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NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 19, 1998
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To the Stockholders of Network Event Theater, Inc.:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of Network
Event Theater, Inc., a Delaware corporation (the "Company"), will be held on
Tuesday, May 19, 1998 at 3:00 p.m., Eastern Standard Time, at the offices of
Proskauer Rose LLP, 1585 Broadway, New York, New York for the purposes of
considering and voting upon the following matters, as more fully described in
the attached Proxy Statement:
1. To approve an amendment to the Company's Certificate of
Incorporation, as amended, to increase the number of shares of common
stock, par value $.01 per share, that the Company is authorized to issue
from 17 million shares to 32 million shares; and
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on April 6, 1998 as
the record date for the determination of stockholders entitled to notice of and
to vote at the meeting.
By Order of the Board of Directors,
Bruce L. Resnik
Secretary
April 13, 1998
YOUR ATTENTION IS DIRECTED TO THE ACCOMPANYING PROXY STATEMENT
You are cordially invited to attend the meeting in person. Whether or not
you expect to be present, please mark, date, sign and return the accompanying
form of proxy in the envelope enclosed (to which no postage need be affixed if
mailed in the United States) so that your vote can be recorded.
<PAGE>
NETWORK EVENT THEATER, INC.
529 Fifth Avenue
New York, New York 10017
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PROXY STATEMENT
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SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 19, 1998
This Proxy Statement is being furnished to the stockholders of Network
Event Theater, Inc., a Delaware corporation (the "Company"), in connection with
the solicitation of proxies, in the accompanying form, by the Company for use at
a Special Meeting of Stockholders to be held at 3:00 p.m., Eastern Standard
Time, on Tuesday, May 19, 1998 at the offices of Proskauer Rose LLP, 1585
Broadway, New York, New York and at any and all adjournments or postponements
thereof.
The stockholders of record at the close of business on April 6, 1998 will
be entitled to receive notice of and to vote at the meeting and any adjournments
or postponements thereof. As of March 31, 1998, there were issued and
outstanding 11,346,880 shares of the Company's common stock, par value $.01 per
share ("Common Stock"), the only class of voting securities outstanding. The
stockholders of record will be entitled to one vote for each share of Common
Stock registered in his or her name on the record date. A majority of all the
outstanding shares of Common Stock constitutes a quorum and is required to be
present in person or by proxy to conduct business at the meeting.
Stockholders may revoke the authority granted by their executed proxies at
any time prior to their use by filing with the Secretary of the Company a
written revocation or a duly executed proxy bearing a later date or by attending
the meeting and voting in person. Solicitation of proxies will be made chiefly
through the mails, but additional solicitation may be made by telephone or
telegram by the officers or regular employees of the Company (who will not be
specifically compensated for such services). The Company may also enlist the aid
of brokerage houses or the Company's transfer agent in soliciting proxies, and
the Company will reimburse them for their reasonable expenses. All solicitation
expenses, including costs of preparing, assembling and mailing proxy material,
will be borne by the Company. This Proxy Statement and accompanying form of
proxy are being mailed to stockholders on or about April 13, 1998.
Shares of Common Stock represented by executed and unrevoked proxies will
be voted in accordance with the choice or instructions specified thereon. It is
the intention of the persons named in the proxy, unless otherwise specifically
instructed in the proxy, to vote all proxies received by them in favor of the
approval of an amendment to the Company's Certificate of Incorporation, as
amended, to increase the number of shares of Common Stock that the Company is
authorized to issue from 17 million shares to 32 million shares. The Board of
Directors does not know of any other matters that may be presented for
consideration at the meeting. However, if other matters properly come before the
meeting, the persons named in the accompanying proxy intend to vote thereon in
accordance with their judgment.
The affirmative vote of the holders of a majority in voting power of the
shares entitled to vote at the meeting will be required to approve the
amendment. Abstentions and broker non-votes are counted for purposes of
determining the presence or absence of a quorum for the transaction of business
and will have the effect of a "no" vote.
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AMENDMENT OF CERTIFICATE OF INCORPORATION
On March 31, 1998, the Board of Directors of the Company adopted a
resolution approving an amendment (the "Amendment") to the Company's Certificate
of Incorporation, as amended, to increase the number of authorized shares of
Common Stock from 17 million to 32 million. The Amendment is subject to
stockholder approval and will be presented to the stockholders at the Special
Meeting for consideration and approval. If approved by the stockholders, the
proposed Amendment will become effective upon filing with the Secretary of State
of the State of Delaware, which will occur as soon as reasonably practicable
after approval.
As of March 31, 1998, 11,346,880 shares of Common Stock were issued and
outstanding. The Board of Directors of the Company has recommended the Amendment
in order to provide the Company with a sufficient number of authorized shares of
Common Stock for the Company's general corporate needs. The Board of Directors
believes that the availability of additional shares will provide the Company
with the flexibility to issue Common Stock for possible financings, acquisitions
or other proper corporate purposes that may be identified in the future by the
Board of Directors, without the possible delay of calling a special
stockholders' meeting. The issuance of additional shares of Common Stock may
have a dilutive effect on earnings per share and, for persons who do not acquire
additional shares to maintain their pro rata interest in the Company, on such
stockholders' percentage voting power.
The authorized shares of Common Stock in excess of those issued will be
available for issuance at such times and for such corporate purposes as the
Board of Directors may deem advisable, without further action by the Company's
stockholders, except as may be required by applicable law or by the rules of the
Nasdaq SmallCap Market or other stock exchange or national securities
association trading system on which the Common Stock may be listed or traded.
Upon issuance, such shares will have the same rights as the outstanding shares
of Common Stock. Holders of Common Stock have no preemptive rights.
The Company has reached agreement in principle to acquire the assets of a
company engaged in the free postcard distribution business for a purchase price
of $285,000, of which 50% would be payable at the closing (half in cash and half
in Common Stock valued at the market price); the balance would be payable in one
year (also half in cash and half in Common Stock valued at the then market
price) and would be contingent upon the acquired business achieving certain
sales levels. Accordingly, if the transaction is consummated and the specified
sales levels are achieved, the Company would issue an aggregate of approximately
17,000 shares of Common Stock at the closing and an additional 17,000 shares one
year thereafter. The Company has no other arrangements, agreements,
understandings or plans at the present time for the issuance or use of the
additional shares of Common Stock proposed to be authorized.
The Board of Directors does not intend to issue any Common Stock except on
terms that the Board of Directors deems to be in the best interests of the
Company and its then existing stockholders. Any future issuance of Common Stock
will be subject to the rights of holders of outstanding shares of any preferred
stock that the Company may issue in the future.
Although the Company has no present intention to issue shares of Common
Stock in the future in order to make acquisition control of the Company more
difficult, future issuances of Common Stock could have that effect. For example,
the acquisition of shares of Common Stock by an entity in order to acquire
control of the Company might be discouraged through the public or private
issuance of additional shares of Common Stock, since such issuance would dilute
the stock ownership of the acquiring entity. Common Stock also could be
privately placed with purchasers who might side with the Board of Directors in
opposing a takeover bid that the Board of Directors has deemed not to be in the
best interests of the Company and its stockholders, thus discouraging such a
bid.
Vote Required
The Board of Directors recommends that holders of Common Stock vote in
favor of the proposal to approve the Amendment. The affirmative vote of the
holders of a majority in voting power of the shares entitled to vote at the
meeting will be required to approve the Amendment.
Rights of Dissenting Stockholders
Under Delaware law, stockholders of the Company who object to the proposal
to approve the Amendment will not be afforded appraisal rights.
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BENEFICIAL OWNERSHIP OF VOTING SECURITIES
The following table sets forth information regarding the beneficial
ownership of the Common Stock as of March 31, 1998 by (i) each person known by
the Company to be the beneficial owner of more than 5% of the outstanding shares
of Common Stock, (ii) each of the Company's executive officers and directors and
(iii) all executive officers and directors of the Company as a group.
Amount and Nature Percentage of
of Beneficial Outstanding
Name and Address of Beneficial Owner(1) Ownership(2) Shares
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Harlan D. Peltz ............................ 2,392,813(3) 21.1%
George Lindemann ........................... 630,757(4) 5.6
c/o Cellular Dynamics, Inc.
767 Fifth Avenue
New York, New York 10153
Don Leeds .................................. 312,379(5) 2.8
Freddie Fields ............................. 312,280(6) 2.8
c/o The Fields & Hellman Company
8899 Beverly Boulevard
Los Angeles, California 90048
Metin Negrin ............................... 70,535 *
Bruce L. Resnik ............................ 16,667(7) *
Jan Miller ................................. 2,000 *
Jeffrey Berg ............................... -- --
All executive officers and directors
as a group (8 individuals) ............... 3,737,431 32.9
Warburg, Pincus Counsellors, Inc. .......... 1,904,762 16.8
466 Lexington Avenue
New York, New York 10017
John Hancock Advisers, Inc. ................ 779,800 6.9
101 Huntington Avenue
Boston, Massachusetts 02199
A. Alfred Taubman .......................... 739,111(8) 6.5
200 East Long Lake Road
Bloomfield Hills, Michigan 48304
Mellon Bank Corporation .................... 630,900 5.6
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
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* Less than 1% of the outstanding Common Stock.
(1) Unless otherwise indicated, the address of each beneficial owner identified
is 529 Fifth Avenue, New York, New York 10017.
(2) Unless otherwise indicated, the Company believes that all persons named in
the table have sole voting and investment power with respect to all shares
of Common Stock beneficially owned by them. A person is deemed to be the
beneficial owner of securities that can be acquired by such person within 60
days from the date of this proxy statement upon the exercise of options,
warrants or convertible securities. Each beneficial owner's percentage
ownership is determined by assuming that convertible securities, options or
warrants that are held by such person (but not those held by any other
person) and which are exercisable within 60 days of the date of this proxy
statement have been exercised.
(3) Includes 63,544 shares owned by Universal Access Network, Inc., a Delaware
corporation wholly owned by Mr. Peltz.
(4) All shares owned by Activated Communications, L.P. ("ACLP"), which is wholly
owned, directly or indirectly, by Mr. Lindemann and his family members. Mr.
Lindemann is the President, and he and his family members are the sole
shareholders, of the general partner of ACLP.
(5) Includes 250,666 shares issuable upon exercise of options granted under the
Company's 1996 Employee Stock Option Plan and by Harlan D. Peltz.
(6) Includes 276,280 shares issuable upon exercise of options owned by a family
trust of which Mr. Fields is a trustee.
(7) Shares issuable upon exercise of options granted under the Company's 1996
Employee Stock Option Plan.
(8) Shares owned as trustee of The A. Alfred Taubman Restated Revocable Trust.
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OTHER MATTERS
The Company's Board of Directors does not know of any other matters that
may be brought before the meeting. However, if any such other matters are
properly presented for action, it is the intention of the persons named in the
accompanying form of proxy to vote the shares represented thereby in accordance
with their judgment on such matters.
MISCELLANEOUS
It is important that proxies be returned promptly. Stockholders who do not
expect to attend the meeting in person are urged to mark, sign and date the
accompanying proxy and mail it in the enclosed return envelope, which requires
no postage if mailed in the United States, so that their votes can be recorded.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the next Annual Meeting
of Stockholders of the Company must be received by the Company by June 21, 1998
in order to be considered for inclusion in the Company's proxy statement
relating to such meeting.
By Order of the Board of Directors,
Bruce L. Resnik
Secretary
New York, New York
April 13, 1998
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PROXY
NETWORK EVENT THEATER, INC.
529 Fifth Avenue
New York, New York 10017
Solicited by the Board of Directors for the
Special Meeting of Stockholders to be held on May 19, 1998
The undersigned hereby appoints HARLAN D. PELTZ, DON LEEDS and BRUCE L.
RESNIK, or any of them, with the power of substitution, as proxies and hereby
authorizes them to represent and to vote, as designated below, all shares of
Common Stock of Network Event Theater, Inc. (the "Company") held of record by
the undersigned at the close of business on April 6, 1998 at the Special Meeting
of Stockholders to be held on May 19, 1998.
1. PROPOSAL TO AMEND THE COMPANY'S CERTIFICATE OF INCORPORATION
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. In their discretion, the proxies are authorized to vote upon any other
business that may properly come before the meeting and any adjournments
thereof.
(Continued and to be SIGNED on other side)
<PAGE>
(Continued from other side)
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DIRECTED. IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSAL 1.
PLEASE SIGN EXACTLY AS NAME APPEARS BELOW.
Dated:__________________________________, 1998
______________________________________________
(Signature)
______________________________________________
(Signature if held jointly)
______________________________________________
(Title if applicable)
Please sign exactly as your name appears on
this proxy. If shares are registered in more
than one name, the signatures of all such
persons are required. A corporation should
sign in its full corporate name by a duly
authorized officer, stating such officer's
title. Trustees, guardians, executors,
administrators and attorneys should sign in
their official capacity giving their full
title as such. A partnership should sign in
the partnership name by an authorized person,
stating such person's title and relationship
to the partnership.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY,
USING THE ENCLOSED ENVELOPE.
No postage is required if mailed in the United States of America.
