<PAGE>
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 (S)240.14a-11(c) or (S)240.14a-12
_____________________________________________________________________
NEI WebWorld, Inc.
(Name of Registrant as Specified In Its Charter)
_____________________________________________________________________
N/A
(Name of Person Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee:
[X] No fee required.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
[ ] $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:
(4) Proposed maximum aggregate value of transaction:
__/ Set forth the amount on which the filing fee is calculated and
state how it was determined.
[ ] 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
<PAGE>
NEI WEBWORLD, INC.
4646 Bronze Way
Dallas, Texas 75236
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 7, 1998
To the holders of Common Stock of
NEI WebWorld, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of NEI
WebWorld, Inc. (the "Company") will be held at the offices of the Company, 4646
Bronze Way, Dallas, Texas, on August 7, 1998 at 10:00 a.m., local time, for the
following purposes:
(a) To elect five directors of the Company; and
(b) To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only shareholders of record at the close of business on June 26, 1998 are
entitled to notice of, and to vote at, the meeting or any adjournment thereof.
Whether or not you plan to attend the Annual Meeting and regardless of the
number of shares you own, please date, sign and return the enclosed proxy card
in the enclosed envelope (which requires no postage if mailed in the United
States).
By Order of the Board of Directors
William K. Daniels
Secretary
Dallas, Texas
July 7, 1998
<PAGE>
NEI WEBWORLD, INC.
4646 Bronze Way
Dallas, Texas 75236
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 7, 1998
This Proxy Statement is furnished to shareholders of NEI WebWorld, Inc., a
Texas corporation (the "Company" or "NEI WebWorld"), in connection with the
solicitation of proxies by the Board of Directors of the Company for use at the
Annual Meeting of Shareholders to be held on August 7, 1998, and at any and all
adjournments or postponements thereof. Proxies in the form enclosed will be
voted at the meeting, if properly executed, returned to the Company prior to the
meeting and not revoked. The proxy may be revoked at any time before it is
voted by giving written notice to the Secretary of the Company.
This Proxy Statement and accompanying form of proxy are being mailed to the
Company's shareholders on or about July 7, 1998. The Company's Annual Report on
Form 10-KSB, covering the Company's fiscal year ended March 31, 1998, is
enclosed herewith but does not form any part of the materials for solicitation
of proxies.
ACTION TO BE TAKEN AT THE MEETING
Only holders of record of common stock at the close of business on June 26,
1998 (the "Record Date") are entitled to notice of, and to vote at, the Annual
Meeting. At the close of business on the Record Date, the Company had issued
and outstanding, and entitled to vote at the Annual Meeting, approximately
3,719,778 shares of common stock. The presence, either in person or by properly
executed proxy, of the holders of record of a majority of the common stock
outstanding on the Record Date is necessary to constitute a quorum at the Annual
Meeting.
At the Annual Meeting, holders of the Company's common stock will consider
and vote for the election as directors of the Company Floyd W. Collins, Barry B.
Conrad, Brian A. Harpster, Robert D. Kopitke and Richard J. Wiencek. Should any
nominee become unable or unwilling to accept nomination or election, the proxy
holders may vote the proxies for the election in his stead of any other person
the Board of Directors may recommend. Each nominee has expressed his intention
to serve the entire term for which election is sought.
Holders of record of common stock are entitled to one vote per share. The
election as a director of each nominee for election as a director requires the
affirmative vote of the holders of record of a plurality of the outstanding
voting power of the shares of common stock represented, in person or by proxy,
at the Annual Meeting.
The accompanying proxy, unless the shareholder otherwise specifies in the
proxy, will be voted (i) for the election as directors of the Company of the
five nominees set forth above and (ii) at the discretion of the proxy holders on
any other matter that may properly come before the meeting
<PAGE>
or any adjournment thereof. Where shareholders have appropriately specified how
their proxies are to be voted, they will be voted accordingly. Abstentions will
have no effect on the proposal to elect the directors of the Company. Broker
non-votes will not count for or against the matters to be voted on at the Annual
Meeting.
If any other matter or business is brought before the meeting, the proxy
holders may vote the proxies in their discretion. The directors do not know of
any such other matter or business.
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth certain information regarding the beneficial
ownership of the Company's common stock as of June 26, 1998 for (i) each person
who is known by the Company to own beneficially more than 5% of the outstanding
shares of common stock, (ii) each director of the Company, (iii) each of the
named executive officers, and (iv) all of the directors and officers of the
Company as a group. Except pursuant to applicable community property laws and
except as otherwise indicated, each shareholder identified in the table
possesses sole voting and investment power with respect to its or his shares.
<TABLE>
<CAPTION>
NUMBER OF
NAME SHARES PERCENTAGE OWNED
---- ------ ----------------
<S> <C> <C>
Barry B. Conrad (1) 381,339 10.3%
Richard J. Wiencek (1) 442,250 11.8
Andrew P. Swan -- --
William K. Daniels 44,199 1.2
Floyd W. Collins 224,695 6.0
Brian A. Harpster(2) 669,609 18.0
Robert D. Kopitke(3) 124,875 3.4
All directors, nominees for director and
executive officers as a group (seven individuals) 1,886,967 50.7
</TABLE>
- ---------------------------
* Indicates less than 1%
(1) The address of Messrs. Conrad and Wiencek is 4646 Bronze Way, Dallas, Texas
75236.
(2) Consists of 669,609 shares held by Holly Investments, L.P., of which Mr.
Harpster's spouse is the beneficial owner. Mr. Harpster's address is 1324
E. Grand Avenue, Ponca City, Oklahoma 74601.
(3) Consists of 124,875 shares held by The Gensal Group, Inc., of which Mr.
Kopitke is the principal shareholder.
DIRECTORS AND EXECUTIVE OFFICERS
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A brief description of each director of the Company is provided below.
Directors hold office until the next annual meeting of the Shareholders or until
their successors are elected and qualified.
Barry B. Conrad, 57, has served as a director of the Company since the
Company's inception. Mr. Conrad is a co-founder and Managing Partner of
Conrad/Collins Merchant Banking Group Ltd. ("MBG"), a Dallas, Texas-based
merchant bank formed in 1988. Mr. Conrad has extensive experience in investment
banking, including more than five years as head of corporate finance for
Rauscher Pierce Refsnes, Inc. Prior to joining Rauscher Pierce Refsnes, Inc. in
1983, he served for approximately ten years as Chief Executive Officer of Hart
Delta, Inc., a pharmaceutical manufacturing firm. He also serves on the Board
of DSI Toys, Inc.
Richard J. Wiencek, 59, has been the President and Chief Executive Officer
of the Company since the Company's inception. Prior to co-founding the Company,
Mr. Wiencek served in various executive positions with Computer Language
Research, Inc., a software development company, for 15 years, most recently as
Group Vice President, Corporate Operations. Prior to joining Computer Language
Research, Inc., Mr. Wiencek served for approximately 14 years in various
financial and operations management positions with Texas Instruments, Inc.
Andrew P. Swan, 40, has served as the Chief Operating Officer of the
Company since February 1998. From February 1997 to February 1998, Mr. Swan
served as the Senior Consultant to The George Group, a Dallas, Texas based
consulting firm which provides consulting advice to manufacturing and
distribution clients. From April 1995 to February 1997, Mr Swan served as a
private consultant to manufacturing and distribution clients. From December
1993 to December 1994, Mr. Swan served as a partner of The Northwestern Company,
a distributor of fasteners and other industrial supplies. From 1990 to 1993,
Mr. Swan served as the Vice President and General Manager of the Steel
Processing Division of Super Steel Products Corporation.
William K. Daniels, 39, has served as the Vice President--Finance and Chief
Financial Officer of the Company since July 1997. Prior to joining the Company,
Mr. Daniels served as Chief Financial Officer of MBG since 1989. From 1986 to
1989, he was Manager of the Department of Internal Controls for Rauscher Pierce
Refsnes, Inc. Prior thereto, he was a senior auditor with Deloitte Haskins &
Sells, a public accounting firm. Mr. Daniels is a certified public accountant.
Floyd W. Collins, 45, has served as a director of the Company since March
1997. Mr. Collins has been a co-founder and Managing Partner of MBG since 1988.
Mr. Collins has an extensive background in private equity investing, including
service as Executive Vice President of Hickory Venture Capital Corporation and
General Partner of Sunwestern Investment Group.
Brian A. Harpster, 53, has served as a director since February 1994. Mr.
Harpster has been engaged in investment and financial consulting for more than
the past five years through the ownership and management of Holly Investments,
L.P. and Offshore Consulting Services, Inc.
3
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Robert D. Kopitke, 56, has served as a director since February 1994. Mr.
Kopitke has been engaged in general business consulting for more than the past
five years as President of The Gensal Group, Inc.
Each of the Company's directors holds office until the next annual meeting
of shareholders and until their respective successors shall have been elected
and qualified or until their earlier death, resignation or removal. The
Company's officers are elected annually by, and serve at the discretion of, the
Board of Directors.
The Board of Directors held four meetings in fiscal 1998. No director
attended fewer than 75% of the meetings of the Board (and any committees
thereof) which they were required to attend.
COMMITTEES OF THE BOARD OF DIRECTORS
The Audit Committee, comprised of Messrs. Collins, Harpster and Kopitke, is
empowered to recommend to the Board the appointment of the Company's independent
public accountants and to periodically meet with such accountants to discuss
their fees, audit and non-audit services, and the internal controls and audit
results for the Company. The Audit Committee also is empowered to meet with the
Company's accounting personnel to review accounting policies and reports. The
Audit Committee met one time during fiscal 1998.
The Compensation Committee, currently comprised of Messrs. Conrad, Wiencek
and Kopitke, is responsible for reviewing and making recommendations to the
Board of Directors with respect to compensation of executive officers, other
compensation matters and awards under the Company's stock option plan. The
Compensation Committee met one time in fiscal 1998.
DIRECTOR COMPENSATION
Directors who are employees of the Company do not receive additional
compensation for serving as directors. Each director who is not an employee of
the Company will receive an annual fee of $5,000 as compensation for his or her
services as a member of the Board of Directors. All directors of the Company
are reimbursed for out-of-pocket expenses incurred in attending meetings of the
Board of Directors or committees thereof, and for other expenses incurred in
their capacities as directors of the Company. Directors are also be eligible to
participate in the Company's stock option plan; however, no options have been
granted to the directors under the stock option plan.
SUMMARY OF EXECUTIVE COMPENSATION
The following table sets forth information concerning cash compensation
paid or accrued by the Company during the three-year period ended March 31, 1998
to or for the Company's Chief Executive Officer. No other executive officer of
the Company received total salary and bonus in excess of $100,000 in fiscal
1998.
4
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SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation
------------------------------
All Other
Name and Fiscal Salary Bonus Compensation
Principal Position Year ($) $ ($) (1)
- ------------------ ------ ------ ----- ------------
<S> <C> <C> <C> <C>
Richard J. Wiencek,
President and CEO 1998 $168,000 $ --- $5,856
1997 168,000 1,615 5,172
1996 168,000 26,813 5,102
</TABLE>
(1) Represents the Company's contribution under the Company's 401(k) savings
plan and premiums paid for life insurance.
The named executive officers did not receive perquisites and other personal
benefits, securities or property in excess of the lesser of $50,000 or 10% of
such officer's total annual salary and bonus.
EMPLOYMENT AGREEMENT
The Company entered into an employment agreement with Richard J. Wiencek,
the Company's President and Chief Executive Officer, in February 1994. The
agreement provides for an initial term of five years and an automatic renewal
for additional successive one-year terms. The agreement may be terminated by
the Company at the end of the initial term or any successive term upon written
notice prior to the end of the then current term. In addition, the agreement may
be terminated for cause or upon the death or disability of Mr. Wiencek. Among
other reasons, the Company may terminate the agreement for cause if the Company
fails to achieve certain financial performance targets. The agreement provides
for a base salary of $160,000 (subject to annual increases in the discretion of
the Company's Board of Directors) and annual bonuses equal to 25% of the
Company's Afree cash flow@ as defined in the agreement. The agreement also
provides for a car allowance and certain other fringe benefits. Pursuant to the
agreement, Mr. Wiencek also received a grant of an option to purchase 249,750
shares of common stock at an exercise price of $.30 per share, which vested in
April 1996.
CERTAIN TRANSACTIONS
In February 1994, the Company also entered into a management agreement with
MBG, of which Barry B. Conrad, the Chairman of the Board of the Company, and
Floyd W. Collins, a director of the Company, are principals. Under the terms of
the agreement, MBG provides supervisory management services to the Company,
including the negotiation, financing and consummation of all of the acquisitions
made by the Company. MBG received compensation of $150,000 and $100,000 under
the agreement during fiscal 1997 and 1998, respectively. In February 1994 and in
connection with executing the agreement, the Company granted MBG an
5
<PAGE>
option to purchase 83,250 shares of common stock at an exercise price of $.30
per share. In April 1996, all the options became fully vested and were
exercised.
In February 1994, the Company entered into a sales consulting agreement
with The Gensal Group, Inc., of which Robert D. Kopitke is a principal. Pursuant
to such agreement, the Company granted The Gensal Group, Inc. an option to
purchase 83,250 shares of common stock at an exercise price of $.30 per share.
As of April 1996, all the options became fully vested and were exercised. The
agreement was terminated effective April 30, 1997, although Mr. Kopitke has
been and will be paid on a project basis for any future sales consulting
performed for the Company. In fiscal 1997 and 1998, the Company paid $60,000
and $30,000, respectively, to Mr. Kopitke for sales consulting.
In April 1996, Mr. Wiencek, MBG and The Gensal Group, Inc. exercised
outstanding options and purchased the underlying shares of common stock. In
connection with these exercises, Mr. Wiencek issued a note to the Company in the
principal amount of $75,000 which becomes due and payable in April 2002. Each
of MBG and The Gensal Group, Inc. issued a note to the Company for the exercise
price of its options in the principal amount of $25,000 which has the same terms
as the note issued by Mr. Wiencek. These notes bear interest at a per annum
rate of 6%.
6
<PAGE>
STOCK OPTIONS
In 1997, the Company adopted the NEI WebWorld, Inc. Stock Option Plan (the
"Option Plan") which provides for the grant of options to eligible employees and
directors for the purchase of Common Stock of the Company. The Option Plan
covers, in the aggregate, a maximum of 350,000 shares of Common Stock. The
Option Plan provides for the granting of both incentive stock options (as
defined in Section 422 of the Internal Revenue Code of 1986) and nonqualified
stock options (options which do not meet the requirements of Section 422).
Under the Option Plan, the exercise price may not be less than the fair market
value of the Common Stock on the date of the grant of the option. No options
have been granted under the Option Plan.
SECTION 16(c) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's directors,
executive officers and persons who own more than 10% of the Company's common
stock are required to report their initial ownership of the Company's common
stock and any subsequent changes in that ownership to the Securities and
Exchange Commission. Specific due dates have been established for these
reports, and the Company is required to disclose in this proxy statement any
failure to file by these dates. All of these filing requirements were
satisfied.
SHAREHOLDERS' PROPOSALS
Any proposals that shareholders of the Company desire to have presented at
the 1999 annual meeting of shareholders must be received by the Company at its
principal executive offices no later than March 3, 1999.
MISCELLANEOUS
The accompanying proxy is being solicited on behalf of the Board of
Directors of the Company. The expense of preparing, printing and mailing the
form of proxy and the material used in the solicitation thereof will be borne by
the Company. In addition to the use of the mails, proxies may be solicited by
personal interview, telephone and telegram by directors and regular officers and
employees of the Company. Arrangements may also be made with brokerage houses
and other custodians, nominees and fiduciaries for the forwarding of
solicitation material to the beneficial owners of stock held of record by such
persons, and the Company may reimburse them for reasonable out-of-pocket
expenses incurred by them in connection therewith.
7
<PAGE>
Representatives of Deloitte & Touche LLP, the Company's independent
auditors, are expected to be present at the Annual Meeting with the opportunity
to make a statement if they desire and to be available to respond to appropriate
questions.
By Order of the Board of Directors
William K. Daniels
Secretary
Dallas, Texas
July 7, 1998
8
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PROXY
NEI WEBWORLD, INC.
The undersigned hereby (a) acknowledges receipt of the Notice of the Annual
Meeting of Shareholders of NEI WebWorld, Inc. (the "Company") to be held on
August 7, 1998, at 10:00 a.m., local time, at 4646 Bronze Way, Dallas, Texas,
and the Proxy Statement in connection therewith, and (b) appoints Barry B.
Conrad and Richard J. Wiencek, and each of them, his proxies with full power of
substitution and revocation, for and in the name, place and stead of the
undersigned, to vote upon and act with respect to all of the shares of common
stock of the Company standing in the name of the undersigned or with respect to
which the undersigned is entitled to vote and act at said meeting or at any
adjournment thereof, and the undersigned directs that his proxy be voted as
follows:
ELECTION OF DIRECTORS [ ] FOR nominees listed below except as marked to the
contrary below
[ ] WITHHOLD AUTHORITY to vote for allnominees listed
below
Floyd W. Collins, Barry B. Conrad, Brian A. Harpster, Robert D. Kopitke, Richard
J. Wiencek
INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.
______________________________________________________________________________
<PAGE>
Whether or not you plan to attend the Annual Meeting and regardless of the
number of shares you own, please date, sign and return this proxy card in the
enclosed envelope (which requires no postage if mailed in the United States).
THIS PROXY WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE. IF NO
SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED FOR THE NAMED PROPOSAL.
The undersigned hereby revokes any proxy or proxies heretofore given to
vote upon or act with respect to such stock and hereby ratifies and confirms all
that said proxies, their substitutes, or any of them, may lawfully do by virtue
hereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
Dated:
-----------------------------
-----------------------------------
Signature
-----------------------------------
(Signature if held jointly)
Please date the proxy and sign your name exactly
as it appears hereon. Where there is more than
one owner, each should sign. When signing as an
attorney, administrator, executor, guardian or
trustee, please add your title as such. If
executed by a corporation, the proxy should be
signed by a duly authorized officer. Please sign
the proxy and return it promptly whether or not
you expect to attend the meeting. You may
nevertheless vote in person if you do attend.
