<PAGE>
SCHEDULE 14A INFORMATION
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:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
GRAND PRIX ASSOCIATION OF LONG BEACH, 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] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] 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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
September 30, 1996
Dear Grand Prix Association of Long Beach, Inc. Shareholder:
You are cordially invited to attend the Grand Prix Association of Long Beach,
Inc., Annual Meeting of Shareholders to be held on Monday, December 9, 1996 at
4:00 p.m. local time. The meeting will be held at the Sheraton Hotel, 333 East
Ocean Boulevard, Long Beach, California.
In addition to electing directors and voting upon the retention of Arthur
Andersen LLP as the Company's independent public accountants, at this year's
meeting, the Company is proposing to change the fiscal year end from June 30 to
December 31, which will allow you to more easily compare the performance of the
company with our competitors.
I hope you will be able to attend this year's Annual Meeting. We will report to
the shareholders on the fiscal year 1995/96, a challenging and rewarding year,
as well as our future strategy for the development of our permanent venues.
YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend the meeting,
please sign, date and return the enclosed proxy card as soon as possible in the
enclosed prepaid envelope in order to ensure that your vote is counted. If you
attend the meeting, you will, of course, have the right to vote your shares in
person.
Very truly yours,
/s/ Christopher R. Pook
Christopher R. Pook
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
December 9, 1996
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Grand Prix
Association of Long Beach, Inc., a California corporation (the "Company") will
be held on Monday, December 9, 1996 at 4:00 p.m. local time, at the Sheraton
Hotel, 333 East Ocean Blvd., Long Beach, California for the following purposes:
1. To elect the following nine (9) directors to serve for the term set forth
opposite their name, and until their successors are elected.
Daniel S. Gurney Three-year term
George S. Pellin Three-year term
James Sullivan Three-year term
Neil Matlins Two-year term
James P. Michaelian Two-year term
Christopher R. Pook Two-year term
Joseph F. Ainge One-year term
Wayne Kees One-year term
John R. Queen, III One-year term
2. To ratify the selection of Arthur Andersen LLP as independent auditors of
the Company for the current fiscal year.
3. To approve the change of the Company's fiscal year end from June 30 to
December 31.
4. To transact any such other business as may properly come before the meeting
or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice.
Only shareholders of record at the close of business on October 14, 1996 are
entitled to notice of and to vote at the meeting and any adjournment thereof.
All shareholders are cordially invited to attend the meeting in person. Any
shareholder attending the meeting may vote in person even if such shareholder
previously signed and returned a proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Gemma A. Bannon
Gemma A. Bannon
Secretary
Long Beach, California
October 21, 1996
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN
THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER TO
ASSURE A QUORUM IS PRESENT AND THAT YOUR SHARES ARE REPRESENTED. NO POSTAGE NEED
BE AFFIXED IF MAILED IN THE UNITED STATES.
<PAGE>
GRAND PRIX ASSOCIATION OF LONG BEACH, INC.
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
The enclosed Proxy is solicited on behalf of the Board of Directors of Grand
Prix Association of Long Beach, Inc. (the "Company") for use at the Company's
Annual Meeting of Shareholders ("Annual Meeting") to be held Monday, December 9,
1996 at 4:00 p.m. local time, or at any adjournment or postponement thereof, for
the purposes set forth herein and in the accompanying Notice of Annual Meeting
of Shareholders. The Annual Meeting will be held at the Sheraton Hotel, 333 East
Ocean Blvd., Long Beach, California 90802.
The Company's principal executive offices are located at 3000 Pacific Avenue,
Long Beach, California 90806. The telephone number is (310) 981-2600.
These proxy solicitation materials were mailed on or about October 21, 1996 to
all shareholders entitled to vote at the Annual Meeting.
A COPY OF THE ANNUAL REPORT CONTAINING FORM 10-KSB IS BEING MAILED TO
SHAREHOLDERS WITH THIS PROXY STATEMENT. A COPY OF THE FORM 10-KSB WILL BE
FURNISHED UPON WRITTEN REQUEST, WITHOUT CHARGE, TO ANY PERSON WHO WAS A
SHAREHOLDER AS OF THE RECORD DATE FOR VOTING AT THE ANNUAL MEETING. SUCH WRITTEN
REQUEST SHOULD BE DIRECTED TO GEMMA A. BANNON, AT 3000 PACIFIC AVENUE, LONG
BEACH, CA 90806.
INFORMATION CONCERNING SOLICITATION AND VOTING
RECORD DATE AND SHARES OUTSTANDING
Shareholders of record at the close of business on October 14, 1996 are entitled
to notice of, and to vote at, the Annual Meeting. At the record date,__________
shares of the Company's Common stock, and 250,000 shares of the Company's Series
B Mandatorily Redeemable Convertible Preferred shares were issued and
outstanding, each share being entitled to one vote at the meeting.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of the
Company a written notice of revocation or a duly executed proxy bearing a later
date or by attending the Annual Meeting and voting in person.
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<PAGE>
VOTING AND SOLICITATION
Every shareholder voting for the election of directors is entitled to one vote
for each share held. Shareholders do not have the right to cumulate their votes
in the election of directors. On all other matters each share is likewise
entitled to one vote on each proposal or item that comes before the Annual
Meeting.
The Company intends to include abstentions and broker non-votes as present or
represented for purposes of establishing a quorum for the transaction of
business, but to exclude broker non-votes from the calculation of shares
entitled to vote with respect to any proposal for which authorization to vote
was withheld.
The cost of this solicitation will be borne by the Company. The Company may
reimburse brokerage firms and other persons representing beneficial owners of
shares for their expenses in forwarding solicitation material to such beneficial
owners. Proxies also may be solicited by certain of the Company's directors,
officers and employees, without additional compensation, personally or by
telephone or facsimile.
PROPOSAL ONE - ELECTION OF DIRECTORS
ELECTION OF DIRECTORS
The term of office of all present directors of the Company will expire on the
day of the Annual Meeting, upon the election of their successors. The Company's
amended Bylaws require that the directors be divided into three classes, with
each class consisting of no less than three directors, one class is to serve for
three years, one class is to serve for two years, and one class is to serve for
one year. The amended Bylaws require that at the first meeting of shareholders
after adoption of the amended Bylaws at which directors are elected, which is
this meeting, directors be elected in the said three classes. The nominating
committee has recommended that the directors be elected in the classes as
outlined below. At subsequent Annual Meetings, directors will be elected to hold
office for three years.
NOMINEES
Each of the nominees named below is currently a director of the Company and was
elected at the last Annual Meeting which was held on October 18, 1995, except
for John R. Queen, III, who was elected on April 29, 1996 and Neil Matlins, who
was elected on August 19, 1996. Set forth below are the names and ages of the
nominees, the principal occupation of each, the year in which first elected as a
director of the Company, the business experience of each for at least the past
five years, and certain other information concerning each of the nominees.
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<PAGE>
Three-year term:
Daniel S. Gurney, 65, has been involved with the Company since its inception in
1974 and has served as a Director of the Company since 1975. Since 1964, Mr.
Gurney has been the owner and Chief Executive Officer of All American Racers
Incorporated of Santa Ana, California, a company that designs race cars. Mr.
Gurney is a former professional race car driver.
George S. Pellin, 56, has been a Director of the Company since 1988. Since 1984,
Mr. Pellin has been the owner and General Manager of Pellin Automotive Products
Company, Inc. which manufactures automotive parts in Los Angeles, California.
Mr. Pellin is also the owner of George Pellin & Associates, a company involved
in the sale of automotive electrical equipment and parts. Mr. Pellin earned a BS
in Business from the University of Southern California in Los Angeles.
James Sullivan, 62, is one of the original shareholders of the Company and has
served as a Director of the Company since 1980. Since 1983, Mr. Sullivan has
been the owner of S.R.E. Industries, Burbank, California, a company which
manufactures souvenir and promotional items with a large presence in the racing
community. Mr. Sullivan was educated at the University of Arizona. He has been
interested in racing since childhood and ran a Championship USAC Midget team in
the late 1970's and early 1980's.
Two-Year Term:
Neil Matlins, 50, became a Director of the Company in August 1996. For the past
five years, Mr. Matlins has been President of Matlins Financial Consulting,
Inc., the general partner of The Lincoln Fund Tax Advantage LP and the general
partner of Lighthouse Capital Management. The funds under the management of Mr.
Matlins own 2.8% of the Company's Common stock. Mr. Matlins has been an investor
for 30 years and has managed funds for individuals and corporate pension plans
for 13 years. Mr. Matlins has served three Illinois governors in appointed
positions in budgeting, evaluation and economic analysis. Mr. Matlins earned an
MA in Managerial Economics and Demography from Cornell University. He graduated
from the University of Virginia in 1968 with honors. He was elected to Phi Beta
Kappa and became a Danforth Fellow. He is a member of Rotary International and a
fellow of the Society for Values in Higher Education.
Page 3
<PAGE>
James P. Michaelian, 53, has been a Director of the Company since 1975, and has
been employed by the Company since its inception in 1974 in various executive
capacities. He has served as Executive Vice President of the Company since 1988,
and Chief Operating Officer since May 1996. Mr. Michaelian also serves as the
Executive Producer of Grand Prix Teleproductions, a division of the Company that
is responsible for providing television broadcast services for the Grand Prix on
ABC and ESPN. Mr. Michaelian holds an MBA from University of California, Los
Angeles.
Christopher R. Pook, 55, founded the Company and has served as Chairman of the
Board of Directors, Chief Executive Officer and President since its inception in
1974. Mr. Pook is also a member of the Board of Governors of the California
State University, Long Beach, and a California delegate appointed by President
Clinton to the White House Conference on Travel and Tourism. Mr. Pook is the
immediate past Chairman of the Greater Los Angeles World Trade Center
Association. Mr Pook was one of the original developers of the concept of
modern-day racing through city streets in the United States.
One-Year Term:
Joseph F. Ainge, 67, has been a Director of the Company since 1975. Mr. Ainge
has been Vice President of the Prime Electro Products Company, a distributor of
electronic components, since 1990. Mr. Ainge earned a BS in Business Management
and Marketing from the University of Utah in Salt Lake City.
Wayne Kees, 73, has served as a Director of the Company since 1975. Mr. Kees has
been retired for more than five years. Mr. Kees also serves as a member of the
Board of Directors of Goodrich Petroleum Corporation and Sizzler International.
John R. Queen, III, 31, has served as a Director of the Company since April,
1996. Since 1991, Mr. Queen has been employed as a trader and analyst for
Capital Research and Management Company, a money management firm based in Los
Angeles, California. Mr. Queen holds a BS in Industrial Management from Purdue
University.
COMPENSATION OF DIRECTORS
Prior to June 1996, non-employee directors received compensation of $500 per
board meeting attended, $500 per committee meeting attended, and stock options.
In December 1993, 149,395 shares of Common stock from the 1993 Stock Option Plan
(4,250 pre-split) (See Note 8 to Notes to Consolidated Financial Statements)
were set aside to be granted to the ten then existing non-employee directors in
consideration of their past service to the Company. Each of those directors was
granted an option to purchase one-tenth of the shares held in the pool,
contingent upon their attendance at
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<PAGE>
four board meetings a year. Options granted to the directors were granted at an
exercise price of $1.09 per share and were to vest over the subsequent five year
period at a rate of 20% per year, with 20% vesting in December 1995. None of the
options has been exercised by existing or retired directors. Stock Option
Agreements under the 1993 Stock Option Plan further provided that if any
director were asked to resign, his or her options would become immediately
vested. The Company further agreed to compensate those directors by paying them
the consideration necessary to exercise only the options which vested in
December 1995. Of the ten then-existing non-employee directors, five are still
board members and each has forty percent of his options vested. The retired non-
employee directors are still eligible to exercise their options, all of which
immediately vested upon resignation.
The Company has no plans to compensate any director in the future in excess of
$500 per meeting attended and $500 per committee meeting attended, except that
previously granted options will continue to vest 20% per year for those
directors who received them provided they attended the four meetings a year.
BOARD MEETINGS
During fiscal year end June 30, 1996, the Board met in person five times. All
incumbent directors attended 80% or more of the meetings of the Board and of the
Committees upon which they served during their term of office.
COMMITTEES OF THE BOARD
Audit Committee. The Audit Committee makes recommendations concerning the
engagement of independent public accountants, reviews the independent public
accountants' plans and results of the audit engagement, approves professional
services provided by the independent public accountants, reviews the
independence of the independent public accountants, considers the range of audit
and non-audit fees and reviews the adequacy of the Company's internal accounting
controls. The Audit Committee currently consists of Messrs. Queen, Pellin and
Ainge, all of whom are currently Directors of the Company.
Nominating Committee. The Nominating Committee selects and nominates qualified
persons to serve as directors of the Company. The Nominating Committee currently
consists of Messrs. Pook, Kees, Gurney and Ainge. Mr. Pook is currently an
officer and Director of the Company and Messrs. Kees, Gurney and Ainge are
currently Directors of the Company.
Page 5
<PAGE>
Compensation Committee. The Compensation Committee determines the annual
compensation of executive officers and key employees of the Company. The
Compensation Committee currently consists of Messrs. Sullivan, Kees and Ainge,
none of whom are officers or employees of the Company.
Stock Option Committee. The Stock Option Committee administers the Company's
1993 Stock Option Plan and its 1996 Employee and Director Stock Incentive Plan.
The Committee determines who are to receive grants under these plans and the
terms of all grants subject to the applicable provisions of the plans. The Stock
Option Committee currently consists of Messrs. Pook, Michaelian, Kees, Queen,
Gurney and Pellin, all of whom are Directors of the Company. Messrs. Pook and
Michaelian are also officers of the Company.
Executive Committee. The Executive Committee has and exercises all of the
powers and authority of the Board in the management of the business and affairs
of the Company that may lawfully be delegated to it by the Board. The Executive
Committee does not have the power to amend the Certificate of Incorporation or
Bylaws of the Company, to adopt an agreement of merger or consolidation, to
recommend to the shareholders the sale, lease or exchange of all or
substantially all of the property and assets of the Company or the dissolution
of the Company, to declare a dividend or authorize the issuance of stock, or to
file bankruptcy. The Executive Committee currently consists of Messrs. Pook,
Michaelian, Kees, Queen, Gurney and Pellin. Messrs. Pook and Michaelian are the
CEO and COO respectively and all of the committee members are Directors of the
Company.
APPROVAL BY SHAREHOLDERS
The nine nominee-directors receiving the highest number of votes cast at the
Annual Meeting will be elected as the Company's directors to serve for the terms
set forth above. So long as the Company is a "listed" corporation within the
meaning of Section 301.5 of the California Corporations Code, the Company's
Bylaws provide for the automatic elimination of cumulative voting. Unless
otherwise instructed, the proxy holder will vote proxies received by her FOR the
nine nominees named above. It is not expected that any nominee will be unable or
will decline to serve as a director. THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR THE ELECTION OF EACH OF THE NOMINEES AS DIRECTORS.
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PROPOSAL TWO
RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
SELECTION OF ARTHUR ANDERSEN LLP
The accounting firm of Arthur Andersen LLP serves the Company as its independent
public accountants and has done so for three years. A representative from Arthur
Andersen LLP will be at the Annual Meeting to answer any questions that arise.
APPROVAL BY SHAREHOLDERS
The affirmative vote of at least a majority of the outstanding shares present
and entitled to vote at the meeting is required for confirmation of the
appointment of the independent pubic accountants for the current fiscal year.
Unless instructed otherwise, the proxy holder will vote proxies held by her FOR
this resolution. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF
THE SELECTION OF ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT PUBLIC
ACCOUNTANTS.
PROPOSAL THREE
CHANGE OF FISCAL YEAR END TO DECEMBER 31
THIS PROPOSAL IS TO CHANGE THE COMPANY'S FISCAL YEAR END FROM JUNE 30 TO
DECEMBER 31
As the Company has begun its transition from a single event/single venue
business to a year-round, three-venue company, it becomes practical to adopt a
calendar year fiscal year. Because the racing season is from March through
October, changing the fiscal year end from June 30 to December 31 will provide a
better point of reference for comparative analysis of actual and projected
events within a racing season. This change will require the Company to file a
six-month transition report on Form 10-KSB for the period of July 1, 1996
through December 31, 1996.
APPROVAL BY SHAREHOLDERS
This matter is not required to be submitted for shareholder approval, but the
Board of Directors has elected to seek the affirmative vote of a majority of the
shares represented and voting at the Annual Meeting with respect to this change.
Unless instructed otherwise, the proxy holder will vote proxies held by her FOR
this resolution. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
PRINCIPAL SHAREHOLDERS
The following table sets forth ownership of the Company's voting securities as
of September 25, 1996 by (i) each person or group who is known by the Company to
own beneficially more than 5% of the outstanding shares of each class of voting
securities, (ii) each director, nominee director and named executive officer and
(iii) all executive officers, significant employees and directors as a group.
<TABLE>
<CAPTION>
AMOUNT AND
----------
NATURE OF PERCENTAGE OF
--------- -------------
TITLE BENEFICIAL CLASS
-------- ---------- -----
NAME OF BENEFICIAL OWNER(3) OF CLASS OWNERSHIP(1) OUTSTANDING (2)
- -------------------------- -------- ---------- ---------------
<S> <C> <C> <C>
Christopher R. Pook(4) Common 445,786 12.0%
James P. Michaelian(5) Common 219,979 6.0%
Dwight R. Tanaka(6) Common 76,034 2.1%
Michael S. Clark(7) Common 44,882 1.7%
Marlene A. Davis(7) Common 12,692 0.4%
Joseph Ainge(8) Common 52,003 1.4%
Daniel S. Gurney(8) Common 88,818 2.4%
Wayne Kees(8) Common 52,003 1.4%
George Pellin(8) Common 65,172 1.8%
John R. Queen, III(9) Common 35,570 1.0%
James Sullivan(8)(10) Common 62,003 1.7%
Neil Matlins (11) Common 102,225 2.8%
Memphis International Motorsports Series B Preferred 250,000 100.0%
Park, Inc. (12)
All executive officers, significant Common 1,303,872 33.9%
employees and directors
as a group (16 persons) (13)
</TABLE>
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of Common stock subject to options or warrants held by that person
that are currently exercisable, or will become exercisable within 60 days
from September 25, 1996, are deemed outstanding. Such shares, however, are
not deemed outstanding for purposes of computing the percentage ownership
of any other person.
(2) Based on 3,640,575 shares of Common stock outstanding.
(3) Unless otherwise noted, the address for each person listed is 3000 Pacific
Avenue, Long Beach, California 90806. Unless otherwise noted, each person
has sole voting and investment power over the shares of Common stock or
Series B Mandatorily Redeemed Convertible Preferred stock listed opposite
his or her name, subject to community property laws where applicable.
(4) Includes options to purchase 69,774 shares of Common stock exercisable
within 60 days. Includes 65,805 shares of Common stock owned by Ellen Pook,
the spouse of Mr. Pook.
(5) Includes options to purchase 43,480 shares of Common stock exercisable
within 60 days.
(6) Includes options to purchase 20,830 shares of Common stock exercisable
within 60 days.
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(7) Includes options to purchase 12,692 shares of Common stock exercisable
within 60 days.
(8) Includes options to purchase 5,976 shares of Common stock exercisable
within 60 days.
(9) Excludes an aggregate of shares of Common stock owned by Mr. Queen's
father, grandmother and brother, of which shares Mr. Queen disclaims
beneficial ownership.
(10) Includes 7,114 shares of Common stock owned by the spouse of Mr. Sullivan,
also includes 41,799 shares of Common stock held by Mr. Sullivan as Trustee
of the SRE Industries Pension Trust.
(11) Includes 61,600 shares of Common stock held by the Lincoln Fund, 18,750
shares of Common stock held by the Lincoln Fund Tax Advantage LP, 15,625
shares of Common stock held by the Gorgon Fund and 6,250 shares of Common
stock held by Matlins Financial Consulting Inc. Profit Sharing Plan which
are managed by Mr. Matlins.
(12) Represents shares transferred to the seller as part of the consideration
for the purchase of Memphis Motorsports Park. Series B Mandatorily
Redeemable Convertible Preferred shares are entitled to be voted in the
same manner as Common stock.
(13) Includes all executive officers and significant employees of the Company,
current directors and nominee directors.
EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES OF THE COMPANY
Christopher R. Pook, founded the Company in 1974 and has since been the Chairman
of the Board of Directors, Chief Executive Officer and President of the Company.
In addition, Mr. Pook currently serves as a member of the Board of Governors of
the California State University, Long Beach, is a California delegate appointed
by President Clinton to the White House Conference on Travel and Tourism and is
immediate past Chairman of the Greater Los Angeles World Trade Center
Association. Mr. Pook was one of the original developers of the concept of
modern-day racing through city streets in the United States.
James P. Michaelian, has been employed by the Company since its inception in
1974 in various executive capacities and has been the Executive Vice President
of the Company since 1988, Chief Operating Officer since May 1996 and a Director
since 1975. Mr. Michaelian also serves as the Executive Producer of Grand Prix
Teleproductions, a division of the Company which is responsible for providing
television broadcast services for the Grand Prix on ABC and ESPN. Mr. Michaelian
holds an MBA from University of California, Los Angeles.
Dwight R. Tanaka has been employed by the Company for the past 19 years and has
been the Vice President of Operations of the Company since 1984. In addition,
Mr. Tanaka is the Chief Operating Officer of the Company's subsidiary
responsible for the grandstand rental and installation business.
Michael S. Clark has been employed by the Company since 1988 and has served as
Vice President of Marketing for the Company since 1991. Mr. Clark also serves as
the Director of Marketing for Competitive Promotional Solutions, a division of
the Company responsible for providing promotion, marketing and public relations
services primarily for organizations involved in the motorsports industry. Mr.
Clark holds a BS degree in Communications from the University of Texas.
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Marlene A. Davis has been the Chief Financial Officer of the Company since 1993.
During 1992, Ms. Davis served as a financial consultant for Ron Harding Moving &
Service Company. From 1989 to 1991, Ms. Davis was the Chief Financial Officer of
HemoCue, a medical instrument distribution company. Ms. Davis holds a BS degree
in Business Administration from the University of Southern California.
Richard W. Lalor, Jr. has served as Vice President of Communications/Public
Relations for the Company since January 1995. From 1992 to 1994, Mr. Lalor was
responsible for motorsports public relations work for Nissan Motor Corporation
USA. From 1987 to 1991, Mr. Lalor was Director of Communications for the
National Hot Rod Association.
Gemma A. Bannon has been the Corporate Secretary of the Company since 1990 and
Executive Assistant to the President of the Company since 1982.
Rodney G. Wolter was retained by the Company in October 1995 to serve as General
Manager of Gateway International Raceway and to supervise the planned
redevelopment of the Gateway facility. Since June 1996, he has been a Vice
President of the Company. From 1987 to 1994, Mr. Wolter served as Manager of the
Nebraska Motorplex in Scribner, Nebraska and was responsible for the operations
of that motorsports facility. From 1962 to February 1993, Mr. Wolter served as a
construction project manager for Kiewit Construction in Omaha, Nebraska.
Todd Bridges was retained by the Company in June 1996 to serve as General
Manager of the Memphis Motorsports Park. From 1991 to 1996, Mr. Bridges was the
owner of Binex Outsourcing Services which provided management consulting
services to various businesses, including Kansas City International Raceway
where he was Marketing/Operations Manager from 1988-1991. Mr. Bridges has been
involved in motorsports for 20 years.
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by or paid
for services rendered to the Company in all capacities during the last three
fiscal years by the Company's Chief Executive Officer and the Company's other
three most highly compensated executive officers whose total annual salary and
bonus exceeded $100,000 during the fiscal year ended June 30, 1996 (the "Named
Officers") and to all executive officers as a group.
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<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation
(a) (b) (c) (d) (e)
OTHER
ANNUAL
FISCAL SALARY BONUS COMPENSATION (1)
NAME AND POSITION YEAR ($) ($) ($)
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Christopher R. Pook 1996 $185,390 $112,194 $ -
Chairman, CEO and President 1995 172,620 105,561 -
1994 157,560 107,766 -
James P. Michaelian 1996 153,586 69,283 -
Chief Operating Officer 1995 141,173 66,127 -
1994 131,280 75,835 -
Dwight Tanaka 1996 100,096 37,074 -
V. P. Operations 1995 94,814 31,850 -
1994 91,152 34,291 -
Michael Clark 1996 72,400 49,680 -
V. P. Marketing 1995 65,975 40,425 -
1994 62,450 30,312 -
===========================================================================================
<CAPTION>
Long-Term Compensation
Awards Payouts
(a) (b) (f) (g) (h) (i)
RESTRICTED SECURITIES LONG-TERM ALL OTHER
STOCK UNDERLYING INCENTIVE COMPEN-
FISCAL AWARDS (2) OPTIONS/SAR'S (2) PAYOUTS (2) SATION (3)
NAME AND POSITION YEAR ($) (#) (S) ($)
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Christopher R. Pook 1996 $ - - $ - $3,510
Chairman, CEO 1995 - - - -
and President 1994 - 174,235 - -
James P. Michaelian 1996 - - - 3,810
Chief Operating Officer 1995 - - - -
1994 - 108,700 - -
Dwight Tanaka 1996 - - - -
V. P. Operations 1995 - - - -
1994 - 52,075 - -
Michael Clark 1996 - - - 3,498
V. P. Marketing 1995 - - - -
1994 - 31,729 - -
==============================================================================================================================
</TABLE>
(1) The aggregate amount of perquisites and other personal benefits, premiums
for health, life and disability insurance, securities or property, given to
each of the Named Officers valued on the basis of aggregate incremental cost
to the Company was less than either $50,000 or 10% of such officer's total
annual salary and bonus during each of these years.
(2) There were no grants of stock options, stock appreciation rights, or stock
options granted in tandem with stock appreciation rights made by the Company
during its fiscal years ended June 30, 1996 or 1995 to the Named Officers.
The number of stock option grants identified in column (g) above included
both exercisable and unexercisable stock options which were granted during
the Company's fiscal year ended June 30, 1994 as described under the 1993
Stock Option Plan detailed below. There were no exercises by any of the
Named Officers of any stock options, stock appreciation rights or stock
options granted in tandem with stock appreciation rights during the fiscal
years ended June 30, 1996, 1995 or 1994.
(3) The amounts reported consist of matching contributions by the Company
pursuant to its 401(k) Plan.
EMPLOYMENT AGREEMENTS
The Company has entered into an Employment Agreement dated as of May 16, 1996
with Christopher R. Pook to serve as the President and Chief Executive Officer
of the Company through May 16, 2001 (the "Pook Employment Agreement").
Pursuant to the Pook Employment Agreement, Mr. Pook is to receive an initial
base salary of
Page 11
<PAGE>
$225,000 per year, which salary may be increased from time to time by the Board
of Directors. Mr. Pook is also entitled to participate in any bonus plan, stock
option plan or any other employee benefit or compensation plan that the Company
may have in effect from time to time. If Mr. Pook's employment is terminated as
a result of a change in control of the Company, or otherwise terminated without
cause by the Company, Mr. Pook will be entitled to receive a severance payment
equal to 30 months of his full base salary, accelerated vesting of all
outstanding stock options and other benefits, continued participation in all
benefit plans for a period of 12 months following his termination and legal fees
incurred by Mr. Pook with respect to contesting the termination of his
employment agreement or securing performance of the terms of his employment
agreement. The Pook Employment Agreement provides that the Company will
indemnify Mr. Pook against any acts or omissions made by him in good faith while
performing services for the Company.
The Company has entered into an Employment Agreement dated as of May 16, 1996
with James P. Michaelian to serve as the Chief Operating Officer of the Company
through May 16, 2001 (the "Michaelian Employment Agreement"). Pursuant to the
Michaelian Employment Agreement, Mr. Michaelian is to receive an initial base
salary of $175,000 per year, which salary may be increased from time to time by
the Board of Directors. Mr. Michaelian is also entitled to participate in any
bonus plan, stock option plan or any other employee benefit or compensation plan
which the Company may have in effect from time to time. If Mr. Michaelian's
employment is terminated as a result of a change in control of the Company, or
otherwise terminated without cause by the Company, Mr. Michaelian will be
entitled to receive a severance payment equal to 30 months of his full base
salary, accelerated vesting of all outstanding stock options and other benefits,
continued participation in all benefit plans for a period of 12 months following
his termination and legal fees incurred by Mr. Michaelian with respect to
contesting the termination of his employment agreement or securing performance
of the terms of his employment agreement. The Michaelian Employment Agreement
provides that the Company will indemnify Mr. Michaelian against any acts or
omissions made by him in good faith while performing services for the Company.
The Company also has employment agreements with other members of the senior
management team, each of which provides that in the event the Company terminates
the employment of the employee, the Company shall pay 60 days severance to the
employee plus all outstanding bonus incentives due to the employee.
STOCK OPTION AND STOCK INCENTIVE PLANS
1996 Employee and Director Stock Incentive Plan. In May 1996 the Board of
Directors and shareholders of the Company approved the Company's 1996 Employee
and Director Stock Incentive Plan (the "1996 Plan"). The 1996 Plan was adopted
in order to enable the Company to attract, retain and motivate key employees and
directors by providing for or increasing the proprietary interests of such
persons in the Company.
Page 12
<PAGE>
All employees and directors of the Company are eligible to participate in the
1996 Plan. The 1996 Plan is administered by the Stock Option Committee of the
Board of Directors (the "Committee"). Pursuant to the 1996 Plan, the Committee
may grant, without limitation, any of the following awards to employees or
directors: shares of Common stock or any option, warrant, convertible security,
stock appreciation right or similar right with an exercise or conversion
privilege at a price related to an equity security, or similar securities with a
value derived from the value of an equity security (an "Award"). Awards are
not restricted to any specified form or structure and may include, without
limitation, sales or bonuses of stock, restricted stock, stock options, stock
purchase warrants, other rights to acquire stock, securities convertible into or
redeemable for stock, stock appreciation rights, limited stock appreciation
rights, phantom stock, dividend equivalents, performance units or performance
shares, and an Award may consist of one such security or benefit, or two or more
of them in tandem or in the alternative. The Committee, in its sole discretion,
determines all of the terms and conditions of each Award granted under the 1996
Plan.
An aggregate of 400,000 shares of Common stock have been reserved for issuance
in connection with Awards made to employees and directors under the Plan. The
Plan is effective for a period of 10 years, through May 2006. The Board of
Directors of the Company may amend or terminate the 1996 Plan at any time and in
any manner; provided, however, that no such amendment or termination may
terminate or modify any Award previously granted under the Plan without the
consent of the recipient of the Award. As of June 30, 1996, no grants of Awards
have been made under the 1996 Plan.
1993 Stock Option Plan. In December 1993 the Company adopted its 1993 Stock
Option Plan (the "1993 Plan"), which was approved and adopted by the Board of
Directors and shareholders of the Company. The 1993 Plan is administered by the
Stock Option Committee, but no further options will be granted under the 1993
Plan. The 1993 Plan was terminated in early 1996.
The exercise price of options granted to optionees under the 1993 Plan had to be
equal to the fair market value of a share of Common stock on the date the option
was granted (110% with respect to optionees who own at least 10% of the
outstanding Common stock). All options granted under the 1993 Plan are non-
qualified stock options.
Options to purchase an aggregate of 602,451 shares of Common stock have been
granted under the 1993 Plan, all of which options (except for options to
purchase 31,729 shares of Common stock which were granted in January 1995), were
granted in December 1993 at an exercise price of $1.09 per share. None of the
options so granted have yet been exercised.
Page 13
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY END OPTION/SAR VALUES
<TABLE>
<CAPTION>
(a) (b) (c) (d) (e)
SHARES
ACQUIRED NUMBER OF SECURITIES VALUE OF UNEXERCISED IN-
0N VALUE UNDERLYING UNEXERCISED THE-MONEY-OPTIONS/SARs
EXERCISE REALIZED OPTIONS/SARs AT FY END(#) AT FY END($)
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---- ---- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Christopher Pook 0 $ 0 69,774 104,461 $586,802 $880,199
Chairman, CEO and President
Jim Michaelian 0 0 43,480 65,220 365,667 548,500
Chief Operating Officer
Dwight Tanaka 0 0 20,830 31,245 175,180 262,770
V.P. Operations
Michael Clark 0 0 12,691 19,038 106,740 160,110
V.P. Marketing
</TABLE>
401(k) PLAN
On November 1, 1995, the Company adopted a 401(k) Plan (the "401(k) Plan")
pursuant to which employees who have completed at least one year of service with
the Company if hired after November 1, 1995, and meet certain other eligibility
requirements may contribute, on a pre-tax basis, a percentage of the employee's
total annual income from the Company, subject to certain Internal Revenue Code
limitations. The Company may make matching contributions to the 401(k) Plan in
its discretion, and for the first two years the Company has committed to make a
matching contribution equal to 25% of employee contributions. All contributions
are allocated to the employee's individual account. Contributions made by the
Company to the 401(k) Plan vest 100% after the employee has been employed for
five years.
BONUS PLAN
Since 1990, the Company has had in effect a three tier bonus plan in which all
permanent employees are eligible to participate (the "Bonus Plan"). In the
first tier of the Bonus Plan a bonus is paid based on the Company's marketing
department having surpassed its projected earnings for the Grand Prix event.
This bonus is allocated among the members of the Company's marketing department
as well as among the employees participating in
Page 14
<PAGE>
the third tier of the Bonus Plan. The second tier of the Bonus Plan offers
incentives to employees for bringing new business into the Company unrelated to
the Grand Prix. Employees in all departments of the Company are eligible to
participate in the second tier of the Bonus Plan. The third tier of the Bonus
Plan is based on the general profitability of the Company overall, and, with the
exception of the Company's marketing department employees, all employees are
eligible to participate in this third tier of the Bonus Plan; however, the
senior executive officers of the Company receive most of the bonus compensation
from this third tier of the Bonus Plan. Before any bonus is payable under the
third tier of the Bonus Plan, the Company's pre-tax profits for the year in
which the bonus is to be calculated must exceed the average of 75% of the pre-
tax profits of the three previous years. In the Company's fiscal year ended June
30, 1996 an aggregate of $421,579 or approximately 18.5% of the Company's pre-
tax profits were distributed pursuant to the Company's Bonus Plan. The Bonus
Plan may be terminated or modified at any time in the sole discretion of the
Company.
LIMITATION OF LIABILITY
The Company's Articles of Incorporation and Bylaws contain provisions limiting
the personal liability of directors to the Company or its shareholders and
indemnifying directors, officers, employees and agents of the Company for
actions, in their capacity as such, to the fullest extent permitted by law. In
August 1994, each of the then-existing non-employee directors of the Company
entered into an indemnification agreement with the Company pursuant to which the
Company has agreed to indemnify the non-employee directors against expenses
incurred by the non-employee director arising out of any act or omission of the
director arising out of his duties as a director of the Company. The Company
anticipates that it will enter into similar agreements with non-employee
directors of the Company who became directors of the Company after August 1994.
Further, each of the Pook Employment Agreement and Michaelian Employment
Agreement provides that the Company shall indemnify and hold harmless Messrs.
Pook and Michaelian against any acts or omissions made by them in good faith
while performing services for the Company. The Company has a directors and
officers liability insurance policy.
At present there is no pending litigation or proceeding involving a director,
officer, employee or agent of the Company where indemnification will be required
or permitted. The Company is not aware of any threatened litigation or
proceeding that may result in a claim for indemnification by any director or
officer.
COMPLIANCE WITH SECTION 16(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent
(10%) of
Page 15
<PAGE>
a registered class of the Company's securities to file reports of ownership on
Form 3 and changes in ownership on Form 4 or 5 with the Securities Exchange
Commission (the "SEC") and the National Association of Securities Dealers. Such
officers, directors and ten percent shareholders are also required by SEC rules
to furnish the Company with copies of all Section 16(a) reports that they file.
Based solely upon a review of copies of such reports received or written
representations from certain reporting persons, the Company believes that it
complied with all Section 16(a) filing requirements applicable to its officers,
directors and ten percent shareholders during the fiscal year ended June 30,
1996, except for the inadvertent late filing of the Forms 4 and 5 for June, 1996
by Directors James Sullivan and George Pellin, and by executive staff members,
Rodney Wolter and Todd Bridges.
ANNUAL REPORT TO SHAREHOLDERS
The Annual Report to Shareholders of the Company for the fiscal year ended June
30, 1996 including audited financial statements has been mailed to the
shareholders concurrently herewith, but such report is not incorporated in this
Proxy Statement and is not deemed to be a part of the proxy solicitation
material.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of shareholders of the Company which are intended to be presented by
such shareholders at the Company's 1997 Annual Meeting must be received by the
Secretary of the Company no later than February 1, 1997 in order to be included
in the proxy solicitation materials relating to that meeting.
OTHER MATTERS
The Board of Directors knows of no other business to be transacted at the Annual
Meeting of shareholders, but if any other matters do come before the meeting, it
is the intention of the persons named in the accompanying proxy to vote or act
with respect to them accordance with their best judgment.
By Order of the Board of Directors
/s/ Gemma A. Bannon
Gemma A. Bannon, Secretary
Page 16
<PAGE>
PROXY
REVOCABLE PROXY
GRAND PRIX ASSOCIATION OF LONG BEACH, INC.
ANNUAL MEETING OF SHAREHOLDERS--DECEMBER 9, 1996
The undersigned shareholder(s) of the Grand Prix Association of Long Beach,
Inc. ("GPALB") hereby nominates, constitutes and appoints Gemma A. Bannon, the
attorney, agent and proxy of the undersigned, with full power of substitution,
to vote all stock of GPALB which the undersigned is entitled to vote at the
Annual Meeting to be held at the Sheraton Hotel, 333 E. Ocean Blvd., Long
Beach, CA, on Monday, December 9, 1996, at 4:00 p.m., and at any adjournment or
adjournments thereof, as fully and with the same force and effect as the
undersigned might or could do if personally present thereat, as follows:
1. ELECTION OF DIRECTORS FOR THE TERMS SET FORTH IN THE NOTICE OF ANNUAL
MEETING
FOR ALL NOMINEES LISTED FOR ALL NOMINEES
BELOW [_] LISTED EXCEPT [_]
------------------------------------------------------------
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the line above.)
D. Gurney, G. Pellin, J. Sullivan, N. Matlins, J. Michaelian, C. Pook,
J. Ainge, W. Kees, J. Queen
2. To ratify the Board's selection of Arthur Andersen LLP as the Company's
independent public accountants for the current fiscal year.
[_] FOR [_] AGAINST [_] ABSTAIN
3. To ratify the Board's resolution to change the Company's fiscal year end
from June 30 to December 31.
[_] FOR [_] AGAINST [_] ABSTAIN
PLEASE SIGN AND DATE ON REVERSE SIDE.
4. To transact such other business as may properly come before the Meeting
and any adjournment or adjournments thereof. Management at present knows of no
other business to be presented by or on behalf of the Company or its Board of
Directors at the Meeting.
THIS PROXY CONFERS AUTHORITY TO AND SHALL BE VOTED "FOR" 1, 2, AND 3 UNLESS
OTHERWISE INDICATED, IN WHICH CASE THE PROXY SHALL BE VOTED IN ACCORDANCE WITH
SUCH INSTRUCTIONS. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS
PROXY SHALL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE BOARD OF
DIRECTORS.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND MAY BE
REVOKED PRIOR TO ITS EXERCISE.
Dated: ________________________
-------------------------------
(Signature of Shareholder)
-------------------------------
(Please Print Name)
(Please date this Proxy and
sign your name as it appears
on your stock certificates.
Executors, administrators,
trustees, etc., should give
their full titles. All joint
owners should sign.)
Check if you plan to attend
the meeting ___
