<PAGE> 1
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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Restrac, Inc.
(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 Statement No.:
3) Filing Party:
4) Date Filed:
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<PAGE> 2
RESTRAC, INC.
3 ALLIED DRIVE
DEDHAM, MA 02026
(617) 320-5600
------------------------
PROXY STATEMENT
------------------------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MONDAY, FEBRUARY 3, 1997
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Restrac, Inc. (the "Company") for use at
the Annual Meeting of Stockholders of the Company to be held on Monday, February
3, 1997, at 4:30 p.m., local time, at Factory Mutual Conference Center, Rte. 1
South, Norwood, Massachusetts, and any adjournments or postponements thereof
(the "Annual Meeting").
At the Annual Meeting, the stockholders of the Company will be asked to
consider and vote upon the following matters:
1. The election of Russell J. Campanello as a Class I Director to
serve until the Annual Meeting of Stockholders following the close of the
Company's 1999 Fiscal Year and until his successor is duly elected and
qualified;
2. Such other business as may properly come before the Annual Meeting
and any adjournments or postponements thereof.
The Notice of Annual Meeting, Proxy Statement and Proxy Card are first
being mailed to stockholders of the Company on or about January 11, 1997 in
connection with the solicitation of proxies for the Annual Meeting. The Board of
Directors has fixed the close of business on December 16, 1996 as the record
date for the determination of stockholders entitled to notice of, and to vote
at, the Annual Meeting (the "Record Date"). Only holders of common stock of
record at the close of business on the Record Date will be entitled to notice
of, and to vote at, the Annual Meeting. As of the Record Date, there were
approximately 7,894,936 shares of common stock, par value $0.01 per share
("Common Stock"), outstanding and entitled to vote at the Annual Meeting and
approximately 43 stockholders of record. Each holder of a share of Common Stock
outstanding as of the close of business on the Record Date will be entitled to
one vote for each share of Common Stock held of record with respect to each
matter submitted at the Annual Meeting. A list of stockholders eligible to vote
at the Annual Meeting will be available for inspection at the Annual Meeting and
for a period of ten days prior to the Annual Meeting during regular business
hours at Factory Mutual Conference Center, Rte. 1 South, Norwood, Massachusetts.
The presence, in person or by proxy, of a majority of the total number of
outstanding shares of Common Stock is necessary to constitute a quorum for the
transaction of business at the Annual Meeting. Abstentions and "broker
non-votes" will be counted as present for determining the presence or absence of
a quorum for the transaction of business at the Annual Meeting. A "broker
non-vote" is a proxy from a broker or other nominee indicating that such person
has not received instructions from the beneficial owner or other person entitled
to vote the shares on a particular matter with respect to which the broker or
other nominee does not have discretionary voting power.
A quorum being present, the affirmative vote of a plurality of the votes
cast is necessary to elect the nominee as a Director of the Company. Abstentions
and broker non-votes will not be counted as voting with respect to the election
of Directors and therefore, will not have an effect on the election of
Directors. With respect to the election of Directors, votes may only be cast in
favor of or withheld from the nominee.
<PAGE> 3
STOCKHOLDERS OF THE COMPANY ARE REQUESTED TO COMPLETE, DATE, SIGN AND
RETURN THE ACCOMPANYING PROXY CARD IN THE ENCLOSED ENVELOPE. COMMON STOCK
REPRESENTED BY PROPERLY EXECUTED PROXIES RECEIVED BY THE COMPANY AND NOT REVOKED
WILL BE VOTED AT THE ANNUAL MEETING IN ACCORDANCE WITH THE INSTRUCTIONS
CONTAINED THEREIN. IF NO INSTRUCTIONS ARE MADE ON THE ACCOMPANYING PROXY CARD
THEN THE PROXY WILL BE VOTED IN FAVOR OF THE PROPOSAL SET FORTH HEREIN. IF OTHER
MATTERS ARE PRESENTED, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE DISCRETION
OF THE PROXY HOLDERS. THE BOARD OF DIRECTORS IS NOT AWARE OF ANY MATTERS OTHER
THAN THE ELECTION OF DIRECTORS THAT WILL BE PRESENTED AT THE ANNUAL MEETING.
Any properly completed proxy may be revoked at any time before it is voted
on any matter (without, however, affecting any vote taken prior to such
revocation) by giving written notice of such revocation to the Secretary of the
Company, or by signing and duly delivering a proxy bearing a later date, or by
attending the Annual Meeting and voting in person. Any stockholder of record as
of the Record Date attending the Annual Meeting may vote in person whether or
not a proxy has been previously given, but the presence, without further action,
of a stockholder at the Annual Meeting will not constitute a revocation of a
previously given proxy.
An Annual Report to Stockholders (which does not form a part of the proxy
solicitation materials), containing financial statements for the fiscal year
ended September 30, 1996 ("Fiscal 1996") is being mailed concurrently herewith
to stockholders of the Company.
The mailing address of the principal executive offices of the Company is 3
Allied Drive, Dedham, Massachusetts 02026.
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<PAGE> 4
PROPOSAL NUMBER 1 -- ELECTION OF DIRECTOR
The Board of Directors of the Company consists of four members and is
divided into three classes, with one Director in each of Class I and Class II
and two Directors in Class III. Directors serve for three-year terms with one
class of Directors being elected by the Company's stockholders at each annual
meeting.
At the Annual Meeting, one Class I Director will be elected to serve until
the Annual Meeting of Stockholders following the close of the Company's 1999
Fiscal Year and until his successor is duly elected and qualified. The Board of
Directors has nominated Russell J. Campanello for re-election as a Class I
Director. Unless otherwise specified in the proxy, it is the intention of the
persons named in the proxy to vote the shares represented by each properly
executed proxy for the re-election of Mr. Campanello as a Director. The nominee
has agreed to stand for re-election and to serve for re-election as a Director.
However, if Mr. Campanello fails to stand for re-election or is unable to accept
re-election, the proxies will be voted for the election of such other person as
the Board of Directors may recommend.
VOTE REQUIRED FOR APPROVAL
A quorum being present, the affirmative vote of a plurality of the votes
cast is necessary to elect a nominee as a Director of the Company.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT THE COMPANY'S
STOCKHOLDERS VOTE "FOR" THE RE-ELECTION OF THE NOMINEE OF THE BOARD OF DIRECTORS
OF THE COMPANY.
INFORMATION REGARDING DIRECTORS
Set forth below is certain information regarding the Directors of the
Company, including the Class I Director who has been nominated by the Board of
Directors for re-election at the Annual Meeting, based on information furnished
by them to the Company.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE SINCE
- ---- --- --------
<S> <C> <C>
CLASS I -- TERM EXPIRES AT ANNUAL MEETING FOLLOWING FISCAL 1996
Russell J. Campanello*......................................................... 40 1994
CLASS II -- TERM EXPIRES AT ANNUAL MEETING FOLLOWING FISCAL 1997
A. Bruce Johnston.............................................................. 37 1994
CLASS III -- TERM EXPIRES AT ANNUAL MEETING FOLLOWING FISCAL 1998
Lars D. Perkins................................................................ 37 1986
J. Paul Costello............................................................... 57 1982
</TABLE>
- ---------------
* Nominee for re-election
The principal occupation and business experience during at least the last
five years for each Director of the Company is set forth below:
Russell J. Campanello was elected as a director of the Company in October
1994. He has been Vice President of Human Development and Organizational
Productivity at Nets Inc. (formerly Industry.Net), a facilitator of electronic
commerce on the internet, since February 1996. Prior to joining Nets Inc., Mr.
Campanello spent eight years as the Vice President of Human Resources of Lotus
Development Corporation.
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<PAGE> 5
A. Bruce Johnston was elected as a director of the Company in January 1994.
Since January 1996, Mr. Johnston has been a Principal of TA Associates, Inc., a
private equity firm. From June 1992 to January 1996, Mr. Johnston was a Vice
President of TA Associates. Prior to such time, Mr. Johnston was a General
Manager of Lotus Development Corporation from June 1988 to June 1992. Mr.
Johnston also serves on the Boards of Directors of Expert Software, Inc. and
Trident International, Inc., both NASDAQ-traded public companies, as well as on
the Boards of Directors of several private companies.
Lars D. Perkins, co-founder of the Company, has served as President, Chief
Executive Officer and Chairman of the Board of the Company since 1986.
J. Paul Costello, co-founder of the Company and member of the Board of
Directors of the Company since its founding in 1982. Mr. Costello has served as
President of J. Paul Costello Associates, Inc., a consulting company, since 1969
and of Costello & Company, Inc., a contract recruiting company, since 1979. In
December 1992, he also was named President of Corporate Staffing Center, Inc., a
provider of outsourced staffing services to large corporate clients. Mr.
Costello has been a human resource management consultant for over thirty years.
The Board of Directors of the Company held ten meetings during Fiscal 1996.
During Fiscal 1996, each of the incumbent Directors except for A. Bruce Johnston
attended 100% of the total number of meetings of the Board and of the committees
of which he was a member during the term of his service as Director. Mr.
Johnston was absent at one meeting. The Board of Directors has established an
Audit Committee and a Compensation Committee.
Audit Committee. The Company's Board of Directors has established an Audit
Committee (the "Audit Committee") which recommends the firm to be appointed as
independent accountants to audit the Company's financial statements and to
perform services related to the audit, reviews the scope and results of the
audit with the independent accountants, reviews with management and the
independent accountants the Company's year end operating results and considers
the adequacy of the Company's internal accounting procedures. The Audit
Committee consists of Russell J. Campanello and A. Bruce Johnston. The first
meeting of the Audit Committee was in December of 1996. Prior to that time,
Arthur Andersen LLP reported to the Board, most recently on January 23, 1996.
Compensation Committee. The Board of Directors has established a
Compensation Committee (the "Compensation Committee") which reviews and
recommends the compensation arrangements for all directors and officers of the
Company. The Compensation Committee also administers and takes such other action
as may be required in connection with the incentive plans of the Company,
including the Restrac, Inc. 1994 Stock Option Plan (the "1994 Stock Option
Plan") and the Restrac, Inc. 1996 Stock Option and Grant Plan (the "1996 Stock
Option Plan") and the Restrac, Inc. 1996 Employee Stock Purchase Plan (the
"Employee Stock Purchase Plan"). The Compensation Committee consists of Russell
J. Campanello and A. Bruce Johnston. The Compensation Committee met once during
Fiscal 1996.
DIRECTOR COMPENSATION
Prior to the Company's initial public offering in July 1996, non-employee
directors of the Company received an annual directors' fee equal to 5% of the
total compensation paid to the chief executive officer of the Company for the
period in question. Effective July 1996, non-employee directors receive $5,000
per year for services rendered as directors, plus a per meeting fee of $1,000
for each directors' meeting attended in person after the fifth meeting, up to a
maximum additional amount of $5,000 per fiscal year. In addition, all directors
of the Company are reimbursed for travel expenses incurred in attending meetings
of the Board of Directors and its committees. Each non-employee director will
automatically receive an option to purchase 5,000 shares of Common Stock when
such director is first elected to the Board of Directors, with such option
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<PAGE> 6
shares vesting proportionately over four years, under the Company's 1996 Stock
Option Plan. In addition, each non-employee director will automatically receive
an option to purchase 2,500 shares of Common Stock on each October 1 that such
director is a member of the Board of Directors, with such option shares vesting
proportionately over four years. All option grants to non-employee directors
will be at a per share exercise price equal to the fair market value of the
Common Stock at the time of grant.
EXECUTIVE OFFICERS
The names and ages of all executive officers of the Company as of December
31, 1996 and the principal occupation and business experience during at least
the last five years for each are set forth below. Except for executive officers
who have employment agreements with the Company, the executive officers serve at
the pleasure of the Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- ---- --------
<S> <C> <C>
Lars D. Perkins.................. 37 President, Chief Executive Officer and Chairman of the
Board
Michael L. Amato................. 39 Vice President of Client Services
Raymond M. Desrochers............ 29 Vice President of Product Development and Quality
Cynthia G. Eades................. 40 Chief Financial Officer, Vice President of Finance and
Treasurer
Martin J. Fahey.................. 42 Vice President and Chief Operating Officer
Thomas J. McCarthy III........... 34 Vice President of Sales
Robert J. Perry.................. 39 Vice President of Marketing
Rachael T. Shanahan.............. 30 Vice President of Business Development, General
Counsel and Secretary
</TABLE>
Lars D. Perkins, co-founder of the Company, has served as President, Chief
Executive Officer and Chairman of the Board of the Company since 1986.
Michael L. Amato has been the Company's Vice President of Client Services
since November 1994. From November 1988 to October 1994, Mr. Amato was Area
Manager for the Northeast Region of Innovative Information Systems, Inc., a
client/server systems integration company.
Raymond M. Desrochers was elected Vice President of Product Development and
Quality of the Company in October 1995. From April 1995 to October 1995, he
served as the Company's Director of Product Development and from October 1994 to
March 1995, he served as the Company's Manager of Software Development. Mr.
Desrochers was a senior software engineer for the Company from July 1992 to
September 1994. Prior to joining the Company in July 1992, he had been Software
Project Manager for New England Business Service, Inc., a company that provides
accounting software solutions to both small and medium-sized businesses, from
October 1991 to June 1992.
Cynthia G. Eades joined the Company as Chief Financial Officer, Vice
President of Finance and Treasurer in December 1994. From February 1993 to
February 1994, she was Vice President and Chief Financial Officer of Virtual
World Entertainment, a developer and operator of virtual reality entertainment
centers. Prior to such time, Ms. Eades was employed by Dun & Bradstreet Software
Services, Inc., a business applications software company, as Controller from
October 1991 to February 1993 and Director of Finance from June 1990 to October
1991. Ms. Eades is a Certified Public Accountant and was employed by Price
Waterhouse from June 1978 to June 1990.
Martin J. Fahey joined the Company as Vice President and Chief Operating
Officer in May 1996. From January 1995 to May 1996, Mr. Fahey was an independent
consultant for a variety of software companies.
5
<PAGE> 7
From July 1991 to December 1994, he was Chief Executive Officer of Vertigo
Development, a multimedia company which Mr. Fahey co-founded. Mr. Fahey was
employed by Lotus Development Corporation, a software company, from January 1983
to June 1991, most recently as the Director of Spreadsheet Marketing.
Thomas J. McCarthy III joined the Company as Vice President of Sales in
February 1995. From October 1994 to January 1995, Mr. McCarthy was Vice
President and General Manager of Padcom Inc., a clinical studies software
company, where he was responsible for all North American operations. Prior to
joining Padcom, Mr. McCarthy had been employed by Software 2000, Inc., a
business applications software company, as a regional manager from May 1993 to
September 1994, a district manager from September 1992 to April 1993 and an
account executive from January 1992 to August 1992. Mr. McCarthy was an account
executive at Dun & Bradstreet Software Services, Inc., a business applications
software company, from December 1989 to December 1991. Mr. McCarthy resigned
from the Company effective January 3, 1997.
Robert J. Perry assumed operational responsibility for the marketing
organization in November 1996 and was elected to the office of Vice President,
Marketing effective as of January 1, 1997. Mr. Perry joined the Company in May
1996 as Director of Product Management. From November 1995 through May 1996, Mr.
Perry was an independent marketing and product management consultant. From
October 1983 to November 1995, Mr. Perry was employed by Lotus Development
Corporation most recently as Director of Advanced Corporate Technology Liaisons.
He had previously served as Director of Product Management for Notes, Director
of Product Management for Graphical Spreadsheets and Group Product Manager for
Spreadsheets.
Rachael T. Shanahan was elected Vice President of Business Development of
the Company in October 1995 and has served as the Company's Secretary since
January 1994 and its General Counsel since August 1993. Prior to such time, she
had been the Company's Contract Administrator/Legal Assistant since December
1990. Ms. Shanahan first joined the Company in 1988 as a systems specialist.
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<PAGE> 8
EXECUTIVE COMPENSATION
The following sections of this Proxy Statement set forth and discuss the
compensation paid or awarded during the last two fiscal years to (i) the
Company's Chief Executive Officer and the four other most highly compensated
executive officers who earned in excess of $100,000 during Fiscal 1996 (the
"Named Executives") and (ii) certain other officers of the Company.
SUMMARY COMPENSATION TABLE
The following table summarizes the compensation paid to, awarded to or
earned by certain officers, including the Named Executives for services rendered
to the Company in all capacities during the last two fiscal years ended
September 30, 1996.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION AWARDS PAYOUTS
------------------------------ ---------------------------------------- -----------------------
FISCAL RESTRICTED SECURITIES ALL
YEAR OTHER ANNUAL STOCK UNDERLYING LTIP OTHER
NAME AND PRINCIPAL POSITION ENDED SALARY ($) BONUS ($) COMPENSATION AWARDS ($) OPTIONS (#) PAYOUTS ($) COMP. ($)
- ---------------------------- ----- ---------- --------- ------------- ---------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lars D. Perkins............. 1996 148,125 -- -- -- -- -- 956(1)
President, CEO 1995 135,000 140,200 -- -- -- -- 5,135(2)
Chairman of the Board
Michael L. Amato............ 1996 100,000 12,000 -- -- 18,230 -- 870(1)
VP of Client Services 1995 92,051(5) 16,550 -- -- 35,460 -- 596(1)
Raymond M. Desrochers....... 1996 100,000 10,000 -- -- 18,125 -- 208(1)
VP of Product 1995 71,583 12,576 -- -- 17,625 -- 536(1)
Development and Quality
Cynthia G. Eades............ 1996 110,000 26,000 -- -- 500 -- 486(1)
VP of Finance, CFO 1995 87,083(5) 16,778 -- -- 53,190 -- 383(1)
Martin J. Fahey............. 1996 56,250(4) 16,250 -- -- 100,500 -- 19,169(1,4)
Chief Operating Officer 1995 -- -- -- -- -- -- --
Thomas J. McCarthy,
III(6).................... 1996 125,000 78,100 -- -- 500 -- 1,502(1,3)
VP of Sales 1995 83,333(6) 133,202 -- -- 141,840 -- 467(1)
Rachael T. Shanahan......... 1996 99,000 25,000 -- -- 500 -- 1,898(1,3)
VP of Business
Development, 1995 70,000 7,683 -- -- -- -- 578(1)
General Counsel and
Secretary
</TABLE>
- ---------------
(1) Other Compensation includes a matching contribution made by the Company on
behalf of the Named Executive under the Company's 401K savings plan.
(2) Other Compensation includes a car allowance of $4,133 and a matching
contribution of $1,002 made by the Company on behalf of Mr. Perkins under
the Company's 401K savings plan.
(3) Includes a $1,000 contribution made in accordance with the Company's
personal computer reimbursement plan.
(4) Based on five months of service with the Company during the fiscal year
ended September 30, 1996. Mr. Fahey's salary would have totaled $135,000 had
he been employed by the Company for the entire fiscal year. In addition,
other Compensation includes a $19,000 earned by Mr. Fahey on a consulting
basis until May 1996, at which time he joined the Company as Vice President
and Chief Operating Officer.
(5) Mr. Amato joined the Company in October 1994, if he had been employed for
the full fiscal year his salary would have been approximately $100,000. Ms.
Eades joined the Company in December 1994, if she had been employed for the
full fiscal year her salary would have been approximately $110,000.
(6) Mr. McCarthy joined the Company in February 1995, if he had been employed
for the full fiscal year his salary would have been approximately $125,000.
Mr. McCarthy resigned from the Company effective January 3, 1997.
7
<PAGE> 9
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth each grant of stock options during Fiscal
1996 to certain officers, including the Named Executives. No stock appreciation
rights ("SARs") have been granted.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------- VALUE AT ASSUMED
NUMBER OF % OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS EXERCISE PRICE APPRECIATION
UNDERLYING GRANTED TO PRICE FOR OPTION TERM(1)
OPTIONS EMPLOYEES PER EXPIRATION ---------------------
NAME GRANTED (A) FISCAL YEAR SHARE DATE 5% 10%
- -------------------------------- ----------- ----------- -------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Lars D. Perkins................. -- -- -- -- -- --
Michael L. Amato................ 17,730 5.26% $ 2.00 11/15/05 $ 22,301 $ 56,514
500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
Raymond M. Desrochers........... 17,625 5.23% $ 4.67 4/11/06 $ 51,764 $ 131,179
500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
Cynthia G. Eades................ 500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
Martin J. Fahey................. 80,000 23.72% $11.00 5/01/06 $553,427 $1,402,493
500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
20,000 5.93% $12.00 8/09/06 $150,935 $ 382,498
Thomas J. McCarthy, III......... 500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
Rachael T. Shanahan............. 500 0.15% $11.00 7/23/06 $ 3,459 $ 8,766
</TABLE>
- ---------------
(A) All options were granted under the Company's 1994 Stock Option Plan and 1996
Stock Option Plan at fair market value as of the date of grant, vest over a
four year period, and are valid for a term of ten years.
(B) For ten year terms, 5% and 10% annual compounding results in total potential
appreciation of 63% and 159% respectively.
(1) This column shows the hypothetical gains or "option spreads" of the options
granted based on assumed annual compound stock appreciation rates of 5% and
10% over the full 10 year term of the options. The 5% and 10% assumed rates
of appreciation are mandated by the rules of the Securities and Exchange
Commission and do not represent the Company's estimate or projection of
future Common Stock prices. The gains shown are net of the option exercise
price, but do not include deductions for taxes or other expenses associated
with the exercise of the option or the sale of the underlying shares. The
actual gains, if any, on the exercises of stock options will depend on the
future performance of the Common Stock, the option holder's continued
employment through the option period and the date on which the options are
exercised.
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<PAGE> 10
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1996
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth the shares acquired and the value realized
upon exercise of stock options during Fiscal 1996 by certain officers, including
the Named Executives, and the number and value of unexercised options held by
such individuals on September 30, 1996.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT FISCAL YEAR END(1) AT FISCAL YEAR END(A)
ACQUIRED VALUE ----------------------------- -------------------------
NAME ON EXERCISE REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- -------------------------- ----------- ----------- ----------------------------- -------------------------
<S> <C> <C> <C> <C>
Lars D. Perkins........... -- $-- --/-- --/--
Michael L. Amato.......... -- $-- 53,190/500 $946,251/$3,875
Raymond M. Desrochers..... -- $-- 35,250/500 $543,379/$3,875
Cynthia G. Eades.......... -- $-- 53,190/500 $973,909/$3,875
Martin J. Fahey........... -- $-- 80,000/500 $620,000/$3,875
--/20,000 $--/$135,000
Thomas J. McCarthy, III... -- $-- 141,840/500 $2,486,455/$3,875
Rachael T. Shanahan....... -- $-- 35,438/500 $648,870/$3,875
</TABLE>
- ---------------
(A) Amount equals the difference between the fair market value and exercise
price at September 30, 1996.
(1) Under the 1994 Stock Option Plan all options are exercisable upon grant, but
the underlying shares vest over time. The Company reserves the right to
repurchase, upon termination of employment all shares issued upon exercise
(unvested shares at the exercise price and vested shares at the then current
fair market value).
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Prior to May 8, 1996, all matters concerning executive officer compensation
were addressed by a Compensation Committee comprised of Mr. Costello and Mr.
Johnston. Since May 8, 1996, the Compensation Committee has been comprised of
Mr. Campanello and Mr. Johnston. Neither Mr. Campanello nor Mr. Johnston is an
employee of the Company. Mr. Campanello has been a director of the Company since
October 1994. Mr. Johnston has been a director of the Company since January
1994. Pursuant to the terms of a License Agreement dated January 1, 1993, the
Company has granted to Mr. Costello, certain of his family members and Costello
& Co., a company of which Mr. Costello is the President and Principal
stockholder, a fully paid, perpetual license to use certain of the Company's
software products. Mr. Johnston is associated with a private equity firm which
owns Common Stock and which previously held shares of preferred stock of the
Company. Effective upon the closing of the Company's initial public offering of
Common Stock in July 1996, all outstanding shares of preferred stock were
automatically converted into Common Stock. In addition, the private equity firm
with which Mr. Johnston is associated received approximately $569,000 in
accumulated dividends upon conversion of the Convertible Preferred Stock. No
executive officers of the Company serve on the Compensation Committee. See
"Certain Relationships and Related Transaction."
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
General
The Compensation Committee of the Board of Directors advises the Chief
Executive Officer and the Board of Directors on matters of the Company's
compensation philosophy and reviews and recommends the
9
<PAGE> 11
compensation arrangements for all directors and officers. The Compensation
Committee also administers and takes such other action as may be required in
connection with the incentive plans of the Company, including the 1994 Stock
Option Plan, the 1996 Stock Option Plan and the 1996 Employee Stock Purchase
Plan. The Compensation Committee consists of Russell J. Campanello and A. Bruce
Johnston.
Compensation Philosophy
The philosophy underlying the development and administration of the
Company's executive compensation policies is to align the interests of executive
management with the Company's annual and long-term performance goals. Key
elements of this philosophy are:
- Providing the executive with a base salary that is competitive with
executive base salaries for comparable companies in its industry and
geographical area, enabling the Company to attract and retain highly
qualified executive officers.
- Establishing a discretionary incentive compensation program that
delivers cash bonuses commensurate with (i) the Company's performance,
as measured by operating, financial and strategic objectives; and (ii)
the executive's performance, as measured against organizational and
management objectives.
- Providing significant equity-based incentives for executives, in the
form of stock options, to strengthen the mutuality of interests
between the executive officers and the Company's stockholders.
The suggested base salary for each executive officer is determined on the
basis of experience, personal performance, the salary levels in effect for
comparable positions within and without the industry and within the geographical
area, and internal base salary comparability considerations. The weight given to
each of these factors differs from individual to individual. On an annual basis,
the Compensation Committee reviews any proposed changes to these salaries and,
while not required to, may approve increases to the base salaries.
Discretionary Incentive Compensation
The discretionary incentive compensation program is a vehicle by which
executives can earn additional cash compensation, depending upon Company and
individual performance relative to specified annual objectives. The objectives
generally represent specific strategic and qualitative objectives, such as
departmental performance improvements, implementation of specified programs and
the timing and caliber of deliverables, as well as quantitative targets. Bonuses
may be paid to each executive officer depending upon the relative success of
their department in achieving its goals for that year and on the Company's
success in achieving its revenue and profitability goals.
Equity Based Incentives
Equity based long-term incentives are provided through grants of stock
options under the 1994 Stock Option Plan and the 1996 Stock Option Plan. The
option grants are designed to align the interests of each executive officer with
those of the stockholders and provide each individual with a significant
incentive to manage the Company from the perspective of an owner with an equity
stake in the Company. Each option grant allows the individual to acquire shares
of the Company's Common Stock at a fixed price per share (generally, the market
price on the grant date) over a specified period of time (generally ten years).
Each option generally vests over a four-year period, contingent upon the
executive officer's continued employment. Accordingly, the option grant will
provide a return to the executive officer only if the executive officer remains
employed by the Company during the vesting period.
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<PAGE> 12
The number of shares subject to each option grant is set at a level
intended to create a meaningful opportunity for stock ownership based on the
executive officer's current position with the Company, the base salary
associated with that position, the size of comparable awards made to individuals
in similar positions within the industry, the individual's potential for
increased responsibility and promotion over the option term and the individual's
personal performance in recent periods. The Compensation Committee also
considers the number of unvested options held by the executive officer in order
to maintain an appropriate level of equity incentive for that individual.
However, the Compensation Committee does not adhere to specific formulas as to
the relative option holdings of the Company's executive officers.
Chief Executive Compensation
Compensation for the Company's President and Chief Executive Officer, Lars
Perkins, is determined with two primary objectives: (i) to establish a level of
base salary competitive with comparable companies and (ii) to make a significant
percentage of the total compensation package contingent upon the Company's
achievement of revenue and profitability and other corporate objectives. During
calendar 1996, Mr. Perkins base salary was increased to $150,000, representing
an increase of $15,000 or 11% over his 1995 calendar salary. Although Mr.
Perkins was eligible for a cash bonus up to $150,000 for Fiscal 1996, he was not
paid a cash bonus for that period.
RUSSELL J. CAMPANELLO A. BRUCE JOHNSTON
11
<PAGE> 13
STOCK PERFORMANCE GRAPH
The following graph represents a comparison of the cumulative total return
(assuming the reinvestment of dividends) for a $100 investment on July 23, 1996
in the Common Stock of the Company, the NASDAQ Composite Index (a broad market
index) and the NASDAQ Computer and Data Processing Stocks Index (a published
industry index).
RESTRAC, INC.
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
NASDAQ COM-
PUTER AND
DATA PR OCES-
NASDAQ STOCK SING STOCKS
MEASUREMENT PERIOD MARKET (US SIC 7370- 7379
(FISCAL YEAR COVERED) RESTRAC, INC. COMPANIES) US & FOREIGN
--------------------- ------------- ------------ --------------
<S> <C> <C> <C>
7/23/96 100.0 98.90 96.00
9/30/96 178.60 116.00 119.10
</TABLE>
- ---------------
(1) The NASDAQ Composite Index is a broad market index which represents
approximately 4,000 NASDAQ companies. The NASDAQ Composite Index is a
measure of all NASDAQ/National Market System issues, exclusive of warrants.
Each security in this Index is weighted by its relative market-
capitalization.
(2) The NASDAQ Computer and Data Processing Stocks which is comprised of the
publicly traded stocks of approximately 650 technology companies. The
Company believes that the NASDAQ Computer and Data Processing Stocks is a
representative peer group index because it contains stock of companies
similar in business, size and growth characteristics to Restrac, Inc.
(3) July 22, 1996 was the effective date of the Company's registration statement
relating to its initial public offering. Trading began in the Company's
Common Stock on July 23, 1996.
(4) The closing sale price of the Common Stock on September 30, 1996 and
December 16, 1996 (Date of Record) was $18.75 and $4.1825, respectively.
12
<PAGE> 14
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with each of the Named
Executives which generally (i) restrict such Named Executive from engaging in
any "competitive business" (as defined in the agreement) for a period of up to
two years following termination of employment, subject to payment by the Company
of up to 30% of the executive officer's base salary; (ii) require the Named
Executive to assign to the Company all rights in all works, ideas and inventions
made by such executive officer during the term of employment which directly
relate to the Company's actual or proposed business; and (iii) require the Named
Executive to keep confidential, both during the term of employment and for a
defined period thereafter, all confidential or proprietary information of the
Company.
Pursuant to a severance agreement executed on January 3, 1997 between the
Company and Mr. Thomas J. McCarthy, III, the Vice President of Sales for the
Company, Mr. McCarthy will receive severance payments equal to 100% of his
targeted compensation for six months following the date of the severance
agreement in return for certain non-competition provisions through January 23,
1999.
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<PAGE> 15
PRINCIPAL AND MANAGEMENT STOCKHOLDERS
The following table sets forth certain information as of December 16, 1996
with respect to the beneficial ownership of Common Stock of the Company by (i)
all persons known by the Company to be the beneficial owners of more than 5% of
the outstanding Common Stock of the Company, (ii) each Director of the Company,
(iii) each of the Named Executives and certain other officers of the Company,
and (iv) all executive officers and Directors of the Company as a group.
<TABLE>
<CAPTION>
PERCENTAGE OF
NAME AND ADDRESS NUMBER OF SHARES OUTSTANDING SHARES OF
OF BENEFICIAL OWNER BENEFICIALLY OWNED(1,2) COMMON STOCK(2,3)
- ------------------------------------------------------ ----------------------- ---------------------
<S> <C> <C>
TA Investors.......................................... 1,818,766(A) 23.0%
c/o TA Associates, Inc.
125 High Street
Boston, MA 02110
Chestnut Investors.................................... 135,680 1.72%
c/o MVP Ventures
45 Milk Street
Boston, MA 02109
Lars D. Perkins....................................... 1,125,626 14.26%
J. Paul Costello...................................... 1,328,385 16.83%
Russell J. Campanello................................. 16,250(B) *
A. Bruce Johnston..................................... 3,646(C) *
Michael Amato......................................... 53,190(D) *
Charles Borwick....................................... 218,634(E) 2.77%
Raymond M. Desrochers................................. 35,250(F) *
Cynthia G. Eades...................................... 53,190(G) *
Martin J. Fahey....................................... 82,000(H) 1.04%
Thomas J. McCarthy III................................ 141,840(I) 1.80%
Rachael T. Shanahan................................... 36,438(J) *
All executive officers and directors
as a group (12 persons)............................. 3,106,449(K) 39.35%
</TABLE>
- ---------------
(1) Under the 1994 Stock Option Plan , all options are exercisable upon grant,
but the underlying shares vest over time. The Company reserves the right to
repurchase, upon termination of employment, all shares issued upon exercise
(unvested shares at the exercise price and vested shares at the then current
fair market value)
(2) The number of shares deemed outstanding includes any shares subject to stock
options held by the person or entity in question that are currently
exercisable or exercisable within 60 days following December 16, 1996.
(3) The applicable percentage ownership is based on the number of shares of
Common Stock owned and outstanding as of December 16, 1996, together with
the applicable options of such stockholder.
* Represents beneficial ownership of less than 1% of the Common Stock
(A) Includes 1,302,965 shares owned by Advent VII L.P., 268,984 shares owned by
Advent Atlantic and Pacific II L.P., 96,974 shares owned by Advent
Industrial II L.P., 130,296 shares owned by Advent New York L.P., and 19,547
shares owned by TA Venture Investors Limited Partnership.
(B) Includes 11,250 shares subject to options held by Mr. Campanello.
14
<PAGE> 16
(C) Includes 3,646 shares of Common Stock in which A. Bruce Johnston has a
pecuniary interest through TA Venture Investors Limited Partnership which
are included in footnote (A) above as being owned by TA Venture Investors
Limited Partnership.
(D) Includes 53,190 shares subject to options held by Mr. Amato.
(E) Includes 70,875 shares subject to options held by Mr. Borwick.
(F) Includes 35,250 shares subject to options held by Mr. Desrochers.
(G) Includes 53,190 shares subject to options held by Ms. Eades.
(H) Includes 80,000 shares subject to options held by Mr. Fahey.
(I) Includes 141,840 shares subject to options held by Mr. McCarthy.
(J) Includes 35,438 shares subject to options held by Ms. Shanahan.
(K) Includes 493,033 shares subject to options held by executive officers and
directors as a group.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On January 5, 1994, the Company sold 517,546 shares of Convertible
Preferred Stock to investment funds associated with TA Associates, Inc. (the "TA
Investors"), 28,951 shares of Convertible Preferred Stock to Chestnut III
Limited Partnership ("CLP") and 9,658 shares of Convertible Preferred Stock to
Chestnut Capital International III Limited Partnership ("CCILP") (CLP and CCILP
collectively, the "Chestnut Investors") (the "1994 Financing Agreement").
Approximately $800,000 of the proceeds were used by the Company to repurchase
shares of Common Stock, including 225,000 shares from Lars D. Perkins, the
President and Chief Executive Officer of the Company, and 225,000 shares from J.
Paul Costello, a director of the Company, at a per share price of $1.32. The
purchase price per share of Convertible Preferred Stock was $6.30. Upon the
closing of the Company's initial offering in July, 1996, the shares of
Convertible Preferred Stock converted into an aggregate of 2,502,696 shares of
Common Stock as provided by a formula set forth in the Company's Certificate of
Incorporation. In addition the TA Investors received approximately $569,000 in
accumulated dividends upon conversion of the Convertible Preferred Stock. Mr.
Johnston, a director of the Company, is a Principal of TA Associates, Inc., the
indirect general partner of each of the TA Investors other than TA Venture
Investors Limited Partnership. Mr. Johnston is a general partner of TA Venture
Investors Limited Partnership.
Since the Company's inception in 1982, Costello & Company, Inc.
("Costello") has been permitted to use the Company's software products and
documentation thereto which is part of the Company's standard offering to its
customers. To formalize this arrangement, on January 1, 1993, the Company
entered into a License Agreement with Costello pursuant to which the Company
granted Costello a fully-paid, perpetual license to use the Company's then
current software products and all replacement products developed and/or marketed
by the Company, with certain limited exceptions, and documentation thereto.
Pursuant to the terms of the License Agreement, Costello does not acquire any
rights of ownership in the software or documentation and said software and
documentation may only be used by Costello and J. Paul Costello, his wife,
children and any business entity at least 51% owned by any of them, each of whom
Costello may grant rights to use the software. John P. Costello III, J. Paul
Costello's son, performs general consulting services for the Company on behalf
of J. Paul Costello Associates, Inc. ("JPC Associates"). J. Paul Costello, the
President and principal shareholder of both Costello and JPC Associates and a
director of the Company, derives a personal benefit from such arrangements.
On January 1, 1991, the Company purchased certain assets from Borwick
International, Inc., an international consulting firm, pursuant to that certain
Agreement for Purchase and Sale of Assets dated January 1, 1991 (the "Asset
Agreement"). The Asset Agreement contains a non-competition clause pursuant
15
<PAGE> 17
to which the Company agreed not to sell software used for "succession planning"
anywhere outside of North America. On September 30, 1995, the Company executed a
Termination Agreement with Borwick International and Irving P. Borwick and a
Finder's Fee and Non-Competition Agreement with Irving P. Borwick. Pursuant to
these two agreements, the Company agreed to pay (i) $550,951.77 to Borwick
International in return for the termination of the Company's non-competition
agreement under the Asset Agreement and a five-year non-competition covenant
from Borwick International and (ii) $500,000 to Irving P. Borwick over a
three-year period in exchange for a five-year non-competition covenant from
Irving P. Borwick. In connection with this transaction, Borwick International
has paid $137,738 to Charles A. Borwick and Irving P. Borwick has agreed to pay
$125,000 to Charles A. Borwick. The Finder's Fee and Non-Competition Agreement
also provides for the payment of a finder's fee to Mr. Borwick in the event that
certain entities purchase a license to use certain software of the Company on or
before September 30, 1997. Irving P. Borwick is the father of Charles A.
Borwick, the Company's former Vice President of Marketing. Charles A. Borwick is
a former principal of Borwick International and was given a share of the
proceeds of the transaction in return for his contribution to the development of
Borwick International's succession planning business.
The Company believes that all transactions with the TA Investors, the
Chestnut Investors, JPC Associates and the Borwick entities were made on terms
no less favorable to the Company than would have been obtained from unaffiliated
third parties. The Company has adopted a policy that transactions between the
Company and its officers, directors and affiliates shall be reviewed on an
ongoing basis and be submitted to the Audit Committee or other comparable body
for review where appropriate.
SUMMARY OF STOCK OPTION PLANS
OVERVIEW
On December 30, 1993, the Restrac, Inc. 1994 Stock Option Plan was adopted
by the Board of Directors of the Company and approved by the Stockholders. (the
"1994 Plan"). On May 8, 1996, the Restrac, Inc. 1996 Stock Option Plan was
adopted by the Board of Directors and approved by the Stockholders (the "1996
Plan"). Each of the 1994 and 1996 Plans permits the grant of (i) options to
purchase shares of Common Stock intended to qualify as incentive stock options
under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"),
(ii) options that do not so qualify and (iii) shares of Common Stock. The 1994
Plan and the 1996 Plan are designed and intended as a performance incentive for
officers, directors, employees, consultants and other key persons performing
services for the Company to encourage such persons to acquire or increase a
proprietary interest in the success of the Company. There are 641,844 shares
reserved for issuance under the 1994 Plan. As of December 2, 1996 15,178 shares
were issued under the 1994 Plan. There are 958,156 shares reserved for issuance
under the 1996 Plan. As of December 2, 1996 no shares were issued under the 1996
Plan.
PLAN ADMINISTRATION; ELIGIBILITY
The 1994 and 1996 Plans provide that it shall be administered by the full
Board of Directors or a committee of non-employee directors, as appointed by the
Board of Directors from time to time.
The Board of Directors may discontinue or amend the 1994 and 1996 Plans at
any time provided that the rights and obligations under any option issued prior
to an amendment of the 1994 and 1996 Plans can not be adversely affected by such
amendment without the consent of the optionee.
The Board of Directors has full power to select, from among the person
eligible for awards under the 1994 and 1996 Plans, the individuals to whom award
will be granted, to make any combination of awards to participants, and to
determine the specific term of each award, subject to the provisions of the 1994
and 1996
16
<PAGE> 18
Plans. Incentive Options may be granted only to officers or other employees of
the Company, including members of the Board of Directors who are also employees
of the Company. Non-Qualified Options may be granted or issued to officers or
other employees of the Company, directors and to consultants and other key
person who provide services to the Company (regardless of whether they are also
employees).
MATERIAL TERMS OF OPTIONS
The exercise price of each option granted under the 1994 and 1996 Plans is
determined by the Board of Directors but, in the case of Incentive Options, may
not be less than 100% of the fair market value of the underlying shares on the
date of grant. No Incentive Option may be granted under the 1994 and 1996 Stock
Option Plans to any employee of the Company or any subsidiary who owns at the
date of grant shares of stock representing in excess of 10% of the voting power
of all classes of stock of the Company unless the exercise price for stock
subject to such option is at least 110% of the fair market value of such stock
at the time of grant and the option term does not exceed five years. Each option
may be exercised only by the optionee during his or her lifetime. As of the
close of business on September 30, 1996, the fair market value of a share of
Common Stock was $18.75, as determined by the price of a share of the Common
Stock on Nasdaq.
The term of each option is fixed by the Board of Directors and, in the case
of an Incentive Option, may not exceed ten years from the date of grant. Except
with respect to the automatic grants of options which are granted to
non-employee directors of the date they become directors and on the date of each
annual meeting of stockholder, which provide for a fixed vesting schedule, the
Board of Directors determines at what time or times each option may be exercised
and, subject to the provisions of the 1994 and 1996 Plans, the period of time
during which options may be exercised, if any, after termination of employment
for any reason. Options may be made exercisable in installments, and the
exercisability of options may be accelerated by the Board of Directors. Upon
exercise of options, the option exercise price must be paid in full (i) in cash
or by certified or bank check or other instrument acceptable to the Board of
Directors, (ii) if the applicable option agreement permits, by delivery of
shares of Common Stock already owned by the optionee, or (iii) through a
"cashless" exercise procedure, subject to certain limitations.
The 1994 and 1996 Plans provide that in the case of certain transactions
constituting a change in control of the Company, the 1994 and 1996 Plans and the
options issued thereunder shall terminate upon the effectiveness of any such
transaction or event, unless provision is made in connection with such
transaction for the assumption of options theretofore granted, or the
substitution for such options of new options of the successor entity or parent
thereof, with appropriate adjustment as to the number and kind of shares and the
per share exercise prices. In the event of such termination, each holder of
outstanding options shall be permitted to exercise all options for a period of
at least 15 days prior to the date of such termination.
TAX ASPECTS UNDER THE U.S. INTERNAL REVENUE CODE
Under current federal tax law, an employee who receives a non-qualified
option does not generally realize any taxable income at the time the option is
granted. However, upon the exercise of such an option, the employee will
recognize ordinary income measured by the excess of the then fair market value
of the Common Stock over the exercise price, and the Company generally will be
entitled to a tax deduction for a corresponding amount. On the other hand, an
employee who receives an incentive stock option does not generally realize any
taxable income at the time the option is granted or at the time it is exercised.
The excess of the fair market value of the Common Stock on the date of exercise
over the option price is a "tax preference item," however, that may cause the
employee to be subject to the alternative minimum tax. Upon the sale of stock
received upon exercise of any incentive stock option, the optionee will
recognize a capital gain or loss or, depending on the holding period of the
shares, ordinary income, equal to the difference between the sale price
17
<PAGE> 19
and exercise price. The Company is not entitled to a tax deduction with respect
to the grant or exercise of an incentive stock option.
STOCK OPTION PLAN BENEFITS
The benefits or amounts that will be received by or allocated to any
individual or group of individuals under the 1994 and 1996 Plans are not
determinable, except under the 1996 Plan, each non-employee director first
joining the Board of Directors automatically receives an option to purchase
5,000 shares of Common Stock when such director is first elected or appointed to
the Board of Directors, with option shares vesting proportionately over four
years. In addition, each non-employee director automatically receives an option
to purchase 2,500 shares of Common Stock on each October 1 that such director is
a member of the Board of Directors, with option shares vesting proportionately
over four years. All option grants to non-employee directors are at a per share
exercise price equal to the fair market value of the Common Stock at the time of
grant.
INDEPENDENT AUDITORS
The firm of Arthur Andersen LLP ("Arthur Andersen") has been selected by
the Board of Directors to be the Company's independent auditors for fiscal 1997.
Arthur Andersen has served as independent auditors of the Company since fiscal
1993.
The consolidated financial statements of the Company for Fiscal 1996 have
been audited and reported upon by Arthur Andersen. Arthur Andersen also
performed tax services for the Company during Fiscal 1996.
A representative of Arthur Andersen will be present at the Annual Meeting
and will be given the opportunity to make a statement if he or she so desires.
The representative will be available to respond to appropriate questions.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of the Company's
outstanding shares of Common Stock, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and NASDAQ. Officers,
directors and greater than ten percent stockholders are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Section 16(a)
reports were required for those persons, the Company believes that during Fiscal
1996, all filing requirements were complied with.
EXPENSES OF SOLICITATION
The Company will pay the entire expense of soliciting proxies for the
Annual Meeting. In addition to solicitations by mail, certain directors,
officers and regular employees of the Company (who will receive no compensation
for their services other than their regular compensation) may solicit proxies by
telephone, telegram or personal interview. Banks, brokerage houses, custodians,
nominees and other fiduciaries have been requested to forward proxy materials to
the beneficial owners of shares of Common Stock held of record by them and such
custodians will be reimbursed for their expenses.
18
<PAGE> 20
SUBMISSION OF STOCKHOLDER PROPOSALS FOR THE
ANNUAL MEETING OF STOCKHOLDERS FOLLOWING THE CLOSE OF
THE COMPANY'S 1997 FISCAL YEAR
Stockholder proposals intended to be presented at the Annual Meeting of
Stockholders following the close of the Company's 1997 Fiscal Year must be
received by the Company no later than September 12, 1997 in order to be
considered for inclusion in the Company's proxy statement and form of proxy for
that meeting. Such a proposal must also comply with the requirements as to form
and substance established by applicable laws and regulations in order to be
included in the proxy statement.
The Company's By-laws provide that any stockholder of record wishing to
have a stockholder proposal considered at an annual meeting must provide written
notice of such proposal and appropriate supporting documentation, as set forth
in the By-laws, to the Company at its principal executive office not less than
75 days nor more than 120 days prior to the first anniversary of the date of the
preceding year's annual meeting (the "Anniversary Date"); provided, however,
that in the event the annual meeting is scheduled to be held on a date more than
30 days before the Anniversary Date or more than 60 days after the Anniversary
Date, a stockholder's notice shall be timely if delivered to, or mailed to and
received by, the Company at its principal executive office not later than the
close of business on the later of the 75th day prior to the scheduled date of
such annual meeting or the 15th day following the day on which public
announcement of the date of such annual meeting is first made by the Company.
Any such proposal should be mailed to: Secretary, Restrac, Inc., 3 Allied
Drive, Dedham, Massachusetts 02026.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
described in this Proxy Statement which will be presented for action at the
Annual Meeting. If other matters are duly presented, proxies will be voted in
accordance with the best judgment of the proxy holders.
STOCKHOLDERS MAY OBTAIN, WITHOUT CHARGE, A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO,
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR THE 1996 FISCAL YEAR BY
WRITING TO RESTRAC, INC., 3 ALLIED DRIVE, DEDHAM, MASSACHUSETTS 02026.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE , SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
19
<PAGE> 21
RESTRAC, INC.
ANNUAL MEETING OF STOCKHOLDERS - FEBRUARY 3, 1997
P
R The undersigned, revoking all prior proxies, hereby appoints Cynthia G.
O Eades and Martin J. Fahey and each of them (with full power of substitution),
X as proxies of the undersigned to attend the Annual Meeting of the
Y Stockholders of Restrac, Inc. (the "Company") to be held on Monday, February
3, 1997 at 4:30 p.m. and any adjourned sessions thereof, and there to vote
and act upon (1) as hereinafter specified upon the proposal listed on the
reverse side and as more particularly described in the Company's Proxy
Statement and (2) in their discretion upon such other matters as may properly
come before the meeting.
The undersigned hereby acknowledge receipt of: (1) Notice of Annual
Meeting of Stockholders of the Company, (2) accompanying Proxy Statement, and
(3) Annual Report of the Company for the fiscal year ended September 30,
1996.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, YOU ARE URGED
TO SIGN AND PROMPTLY MAIL THIS PROXY IN THE RETURN ENVELOPE SO THAT YOUR
STOCK MAY BE REPRESENTED AT THE MEETING.
-----------
SEE REVERSE
CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
-----------
[X] PLEASE MARK
VOTES AS IN
THIS EXAMPLE
The shares represented by this proxy will be voted as directed by the
undersigned. If no direction is given with respect to any election to office
or any proposal specified below, this proxy will be voted for such election
to office.
1. To Re-elect Russell J. Campanello as Director
of the Company.
FOR WITHHELD
[ ] [ ]
MARK HERE MARK HERE
FOR ADDRESS [ ] IF YOU PLAN [ ]
CHANGE AND TO ATTEND
NOTE AT LEFT THE MEETING
Please sign name(s) exactly as appearing hereon.
When signing as attorney, executor, administrator
or other fiduciary, please give your full title as
such. Joint owners should each sign personally. If
a corporation, sign in full corporate name, by
authorized officer. If a partnership, please sign
in partnership name, by authorized person.
Signature:________________Date:_________Signature:________________Date:_________
