SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Check the appropriate box:
[ X ] Filed by the Registrant
[ ] Filed by a party other than the Registrant
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
Volt Information Sciences, 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)(1) 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:
<PAGE>
VOLT INFORMATION SCIENCES, INC.
1221 Avenue of the Americas
New York, New York 10020-1579
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
June 16, 1997
TO THE SHAREHOLDERS OF
VOLT INFORMATION SCIENCES, INC.
The Annual Meeting of Shareholders of Volt Information Sciences, Inc. (the
"Company") will be held at The Chase Manhattan Bank, 11th floor, Conference Room
A, 270 Park Avenue (at 48th Street), New York, New York on Monday, June 16,
1997, at 10:00 A.M., New York time, to consider the following:
1. The election of three Class II directors to serve until the 1999
Annual Meeting of Shareholders and until their respective successors are
elected and qualified;
2. A proposal to ratify the action of the Board of Directors in
appointing Ernst & Young LLP as the Company's independent auditors for
the fiscal year ending October 31, 1997; and
3. Such other business as may properly come before the meeting or any
adjournments or postponements thereof.
Only shareholders of record at the close of business on May 5, 1997 will be
entitled to notice of, and to vote at, the meeting and any adjournments or
postponements thereof. Shares to be issued on May 27, 1997 in payment of a
three-for-two stock split in the form of a 50% stock dividend declared on April
17, 1997 and payable to shareholders of record on May 12, 1997 will not be
entitled to vote at the meeting.
You are cordially invited to attend the meeting. Whether or not you plan to be
present, kindly fill out and sign the enclosed Proxy exactly as your name
appears on the Proxy, and mail it promptly in order that your vote can be
recorded. A return envelope is enclosed for your convenience and requires no
postage if mailed within the United States. The giving of this Proxy will not
affect your right to vote in person in the event that you find it convenient to
attend the meeting.
By Order of the Board of Directors
Jerome Shaw,
Secretary
New York, New York
May 20, 1997
<PAGE>
VOLT INFORMATION SCIENCES, INC.
1221 Avenue of the Americas
New York, New York 10020-1579
PROXY STATEMENT
For
ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement, to be mailed on or about May 20, 1997, is furnished in
connection with the solicitation by the Board of Directors of Volt Information
Sciences, Inc., a New York corporation (the "Company"), of Proxies in the
accompanying form ("Proxy" or "Proxies") for use at the Annual Meeting of
Shareholders of the Company to be held on June 16, 1997 and at any adjournments
or postponements thereof (the "Annual Meeting").
Only holders of record of the Company's Common Stock as of the close of business
on May 5, 1997 are entitled to notice of, and to vote at, the Annual Meeting. As
of the close of business on such date, there were issued and outstanding
9,834,476 shares of Common Stock of the Company. Shares to be issued on May 27,
1997 in payment of a three-for-two stock split in the form of a 50% stock
dividend declared on April 17, 1997 and payable to shareholders of record on May
12, 1997 will not be entitled to vote at the Annual Meeting. Accordingly, all
share information contained in this Proxy Statement does not give effect to such
stock split. Each such issued and outstanding share of Common Stock is entitled
to one vote upon each matter to be acted upon at the Annual Meeting. The
presence, in person or by proxy, of the holders of at least 35% of the total
issued and outstanding shares of Common Stock entitled to vote at the Annual
Meeting will constitute a quorum for the transaction of business thereat.
All Proxies received will be voted in accordance with the specifications made
thereon or, in the absence of specification: (a) for the election of all
nominees named herein to serve as directors and (b) in favor of the proposal to
ratify the appointment of independent auditors. Abstentions and broker non-votes
with respect to any matter are not considered votes cast with respect to that
matter (and, consequently, will have no effect on the vote on the foregoing
matters), but are counted in determining a quorum. Proxies may be revoked at any
time prior to their exercise by written notification to the Secretary of the
Company at the Company's principal executive offices located at 1221 Avenue of
the Americas, New York, New York 10020-1579, by voting at the Annual Meeting or
by submitting a later dated proxy.
Management does not intend to bring before the Annual Meeting any matters other
than those specifically described above and knows of no matters other than the
foregoing to come before the Annual Meeting. If any other matters or motions
properly come before the Annual Meeting, it is the intention of the persons
named in the accompanying form of Proxy to vote such Proxy in accordance with
their judgment on such matters or motions, including any matter dealing with the
conduct of the Annual Meeting.
The cost of solicitation of Proxies, including the cost of reimbursing banks,
brokerage houses and other custodians, nominees and fiduciaries for their
reasonable expenses in forwarding Proxy soliciting material to beneficial owners
of Common Stock, will be borne by the Company. Proxies may be solicited without
extra compensation by certain officers and regular employees of the Company by
mail and, if determined to be necessary, by telephone, telegraph or personal
interviews.
- 1 -
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS, MANAGEMENT AND NOMINEES
The following table sets forth information, as of May 5, 1997 (except as noted
below), with respect to the beneficial ownership of the Company's Common Stock,
its only class of voting or equity securities, by (a) each person who is known
to the Company to own beneficially more than five percent of the Company's
outstanding shares of Common Stock, (b) each of the directors of the Company,
(c) each of the executive officers named in the Summary Compensation Table
contained under "Executive Compensation" and (d) executive officers and
directors as a group:
<TABLE>
<CAPTION>
Name and Address Amount and Nature of Percent of
of Beneficial Owner Beneficial Ownership (1) Class (2)
- ------------------- ------------------------ ---------
<S> <C> <C>
William Shaw
1221 Avenue of the Americas
New York, NY 10020-1579 2,438,502 (3)(4) 24.7%
Jerome Shaw
2401 N. Glassell Street
Orange, CA 92665 2,139,345 (3)(5) 21.6%
Westport Asset Management, Inc.
253 Riverside Avenue
Westport, CT 06880 546,350 (6) 5.6%
James J. Groberg 18,982 (3) *
Irwin B. Robins 34,724 (3) *
John R. Torell III 2,000 *
Mark N. Kaplan 2,000 *
Howard B. Weinreich 9,978 (3) *
All Executive Officers and
Directors as a Group
(11 persons including the foregoing) 4,789,040 (3)(7) 47.8%
- ----------------------
</TABLE>
(1) Except as noted, the named beneficial owners have sole voting and
dispositive power with respect to their respective beneficially owned shares.
Includes shares held for the account of executive officers under the Company's
Employees Stock Ownership Plan as at March 31, 1997 (the latest date as of which
information is available) and under the Company's 401(k) Savings Plan.
(2) Asterisk indicates less than 1%. Shares reflected as owned by a person but
which are issuable upon exercise of options held by such person are considered
outstanding only for the purpose of computing the percentage of outstanding
Common Stock that would be owned by the optionee if the options were exercised,
but (except for the calculation of the beneficial ownership by all executive
officers and directors as a group) are not considered outstanding for the
purpose of computing the percentage of outstanding Common Stock owned by any
other person.
(footnotes continued on next page)
-2-
<PAGE>
(3) Includes shares issuable upon the exercise of the portion of options granted
by the Company which were exercisable on or within 60 days of May 5, 1997 as
follows: William Shaw, 50,000 shares; Jerome Shaw, 81,500 shares; James J.
Groberg, 17,000 shares; Irwin B. Robins, 18,000 shares; Howard B. Weinreich,
6,000 shares; and all executive officers and directors as group, 176,900 shares.
(4) Includes 66,374 shares owned of record by Mr. Shaw as sole trustee of a
trust for the benefit of his wife, as to which shares Mr. Shaw disclaims
beneficial ownership.
(5) Includes (i) 1,872,187 shares owned of record by Mr. Shaw and his wife as
trustees of a revocable trust for their benefit, as to which they have shared
voting and investment power (pursuant to the terms of the trust, Mr. Shaw may
demand that these shares be transferred to him at any time) and (ii) 157,500
shares owned of record by Mr. Shaw and his wife as trustees of a trust for the
benefit of one of their children, as to which Mr. and Mrs. Shaw may be deemed to
have shared voting and investment power (the inclusion of which 157,500 shares
is not an admission of beneficial ownership thereof by Mr. Shaw). Excludes 4,500
shares owned of record by Mr. Shaw's wife, as to which Mr. Shaw disclaims
beneficial ownership.
(6) Based on a Schedule 13G dated February 13, 1997 filed by Westport Asset
Management, Inc. ("Westport"), an investment advisor registered under the
Investment Advisors Act of 1940, containing information as at December 31, 1996.
According to the Schedule 13G, Westport has shared voting power and shared
dispositive power with respect to 529,550 of these shares. Most of the shares
are held in certain discretionary managed accounts of Westport. The Schedule 13G
also reports that certain of these shares are beneficially owned by officers and
shareholders of Westport who disclaim the existence of a group.
(7) Excludes 4,500 shares owned beneficially by the spouse of an executive
officer and director, as to which shares such executive officer and director
disclaims beneficial ownership.
ELECTION OF DIRECTORS
The Company's Board of Directors consists of six directors, divided into two
classes. The terms of office of Class I and Class II directors expire at the
1998 and 1997 Annual Meeting of Shareholders, respectively. At each annual
meeting, directors are chosen to succeed those in the class whose term expires
at that annual meeting to serve for a term of two years each and until their
respective successors are elected and qualified. Each of the present directors
of the Company was elected by the Company's shareholders.
Unless otherwise directed, persons named in the enclosed Proxy intend to cast
all votes pursuant to Proxies received for the election as directors of William
Shaw, Jerome Shaw and James J. Groberg as Class II directors, each to serve
until the 1999 Annual Meeting of Shareholders and, in each case, until his
successor is elected and qualified (such persons being hereinafter referred to
as "nominees"). Each nominee has indicated his availability to serve as a
director. In the event that any of the nominees should become unavailable or
unable to serve for any reason, the holders of the Proxies have discretionary
authority to vote for one or more alternate nominees who will be designated by
the Board of Directors.
A plurality of the votes cast at the Annual Meeting in person or by proxy is
required for the election of each nominee. Votes withheld will have no effect on
the outcome of the election of directors.
-3-
<PAGE>
Background of Nominees and Continuing Directors
Nominees (Class II)
WILLIAM SHAW, 72, a founder of the Company, has been President and Chairman of
the Board of the Company for more than the past five years and has been employed
in executive capacities by the Company and its predecessors since 1950. He has
served as a director of the Company since its formation in 1957.
JEROME SHAW, 70, also a founder of the Company, has been Executive Vice
President and Secretary of the Company for more than the past five years and has
been employed in executive capacities by the Company and its predecessors since
1950. He has served as a director of the Company since its formation in 1957.
JAMES J. GROBERG, 68, has been a Senior Vice President of the Company for more
than the past five years and has been employed in executive capacities by the
Company since 1985 and also from 1973 to 1981. He has served as a director of
the Company since 1987.
Directors Whose Term of Office Continues After the Annual Meeting
(Class I)
IRWIN B. ROBINS, 62, has been a Senior Vice President of the Company for more
than the past five years and has been employed in executive capacities by the
Company since 1980. He has served as a director of the Company since 1981.
JOHN R. TORELL III, 57, has been a director of the Company since October 1989.
Mr. Torell has been Chairman of Torell Management, Inc. (an investment company)
for more than the past five years and Chairman of Telesphere Corporation (an
electronics securities data distributor) since November 1995. He is past
President of Manufacturers Hanover Corporation (a bank holding company) and
Manufacturers Hanover Trust Company (a bank); past Chairman, President and Chief
Executive Officer of CalFed, Inc. (a savings and loan holding company); and past
Chairman and Chief Executive Officer of Fortune Bancorp (a savings and loan
holding company). He is also a director of American Home Products Corporation
and The Paine Webber Group, Inc.
MARK N. KAPLAN, 67, has been a director of the Company since April 1991. Mr.
Kaplan has been a partner in the law firm of Skadden, Arps, Slate, Meagher &
Flom LLP since October 1979. He is also a director of Grey Advertising, Inc.,
Diagnostic/Retrieval Systems, Inc., Refac Technology Development Corporation,
American Biltrite, Inc., Congoleum Corporation and MovieFone, Inc.
William Shaw and Jerome Shaw are brothers. Steven Shaw, elected a Vice President
of the Company on April 11, 1997, is the son of Jerome Shaw. There are no other
family relationships among the directors or executive officers of the Company.
Messrs. William Shaw, Jerome Shaw and Irwin B. Robins are parties to employment
agreements with the Company. See "Employment Agreements" under "Executive
Remuneration".
- 4 -
<PAGE>
Committees of the Board
The Company has Audit and Compensation Committees, but does not have a
nominating committee.
The Audit Committee, consisting of Messrs. Kaplan and Torell, is authorized to
examine and consider matters related to internal and external audits of the
Company's accounts, the financial affairs and accounts of the Company, the scope
of the independent auditor's engagement, the effect on the Company's financial
statements of any proposed changes in generally accepted accounting principles,
disagreements, if any, between the Company's independent auditors and
management, the quality of the Company's system of internal accounting controls,
and matters of concern to the independent auditors resulting from the audit,
including the result of the independent auditor's review of internal accounting
controls and suggestions for improvements. The Audit Committee did not meet
separately from the entire Board during the past fiscal year.
The Compensation Committee, consisting of Messrs. Kaplan and Torell, is
authorized to make recommendations to the Board concerning compensation for
those officers who are also directors of the Company. The Compensation Committee
did not meet separately from the entire Board during the past fiscal year.
Until August 26, 1996, the Company's Stock Option Committee, consisting of
Messrs. William Shaw, Kaplan and Torell, was authorized to grant stock options
under the Company's 1995 Non-Qualified Stock Option Plan. While the Stock Option
Committee held no formal meetings during the past fiscal year, it acted by
unanimous written consent on two occasions following informal discussions. On
August 26, 1996, the Company adopted the provisions of Rule 16b-3 promulgated
under the Securities and Exchange Act of 1934 with respect to the 1995
Non-Qualified Stock Option Plan and, in light thereof, all options are now
granted by the full Board of Directors.
The Board of Directors met twice during the past fiscal year and acted by
unanimous written consent on five occasions following informal discussions. Each
director attended each of the meetings of the Board of Directors which were held
during the fiscal year.
-5-
<PAGE>
EXECUTIVE REMUNERATION
Summary Compensation Table
The following table sets forth information concerning the compensation during
the fiscal years ended November 1, 1996, November 3, 1995 and October 28, 1994
of the Company's Chief Executive Officer and each of the four other executive
officers of the Company who received the highest cash compensation during the
year ended November 1, 1996 for services rendered in all capacities to the
Company and its subsidiaries:
<TABLE>
<CAPTION>
Long-Term
Compensation
Annual Compensation Securities Underlying All Other
Principal Position Year Salary (1) Bonus Options (2) Compensation (3)
- ------------------ ---- ---------- ----- ----------- ----------------
<S> <C> <C> <C> <C> <C>
William Shaw, 1996 $355,000 -- 39,000 $ 1,707
President and 1995 348,365 -- -- 1,631
Chief Executive Officer 1994 330,000 -- -- 1,571
1993
Jerome Shaw, 1992 355,000 -- 39,000 1,707
Executive Vice President 1991 348,365 -- -- 1,894
1990 330,000 -- -- 1,571
1989
James J. Groberg, 1988 248,462 $65,000 23,000 1,349
Senior Vice President and 1987 240,528 15,000 -- 1,651
Chief Financial Officer 1986 219,603 15,000 -- 1,260
1985
Irwin B. Robins, 1984 220,155 10,000 23,000 1,468
Senior Vice President 1983 214,135 10,000 -- 1,907
1982 202,500 5,000 -- 1,452
1981
Howard B. Weinreich, 1980 161,589 7,500 9,000 1,349
General Counsel 1979 154,915 7,500 -- 1,781
1978 145,167 5,000 -- 1,051
- -------------------------------------
</TABLE>
(1) Includes compensation deferred under the Company's deferred
compensation plan and under Section 401(k) of the Internal Revenue Code
of 1986, as amended.
(2) In addition to options to purchase shares of the Company's Common
Stock, includes options to purchase the following number of shares of
Common Stock of the Company's 59% - owned subsidiary, Autologic
Information International, Inc. ("Autologic"): William Shaw, 9,000
shares; Jerome Shaw, 9,000 shares; James J. Groberg, 5,000 shares;
Irwin B. Robins, 5,000 shares; and Howard B. Weinreich, 3,000 shares.
See "Option Grants in Fiscal Year", below.
(3) Amounts in fiscal 1996 include premiums under the Company's group life
insurance policy ($716 for William Shaw; $716 for Jerome Shaw; $716 for
James J. Groberg; $477 for Irwin B. Robins; and $358 for Howard B.
Weinreich) and the market value at the date of contribution of the
portion of the shares of Common Stock contributed by the Company under
- 6 -
<PAGE>
its Employee Stock Ownership Plan ($987 for each of the named executive
officers), together with the market value at fiscal year-end of the
portion of the shares forfeited by terminated employees under such plan
($5 for each of the named executive officers), which were allocated
during fiscal 1997 with respect to fiscal 1996 to the named officers in
accordance with such plan.
Option Grants in Last Fiscal Year
The following table contains information concerning options granted by the
Company and Autologic during the Company's 1996 fiscal year to the executive
officers named in the Summary Compensation Table:
<TABLE>
<CAPTION>
Individual Options Potential Realizable
------------------------------------- Value at Assumed
Number of Shares Percent of Total Annual Rates of Stock
of Underlying Options Granted Exercise Price Appreciation
Options to Employees In Price Expiration for Option Term (3)
-------------------------
Name Granted (1) Fiscal Year (2) Per Share Date 5% 10%
- ---- ----------- -------------- ---------- ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
William Shaw 30,000 6.3% $ 38.13 8/26/06 $ 719,298 $1,822,843
9,000 6.7% 13.20 1/29/01 19,038 53,135
Jerome Shaw 30,000 6.3% 27.13 4/22/06 511,763 1,296,908
9,000 6.7% 13.20 1/29/01 19,038 53,135
James J. Groberg 18,000 3.8% 27.13 4/22/06 307,058 778,145
5,000 3.7% 12.00 1/29/06 37,734 95,625
Irwin B. Robins 18,000 3.8% 27.13 4/22/06 307,058 778,145
5,000 3.7% 12.00 1/29/06 37,734 95,625
Howard B. Weinreich 6,000 1.3% 27.13 4/22/06 102,353 259,382
3,000 2.2% 12.00 1/29/06 22,460 57,375
- --------------------
</TABLE>
(1) The options reflected on the first line adjacent to each optionee's name
were granted under the Company's 1995 Non-Qualified Stock Option Plan (the
"Company Plan"). Each option granted under the Company Plan was granted at an
exercise price equal to 100% of the market value of the Company's Common Stock
on the date of grant and is exercisable at any time during its term, commencing
one year following the date of grant, subject to earlier termination at
specified times following termination of employment, death or disability. The
options reflected on the second line under each optionee's name were granted
under Autologic 1995 Stock Option Plan (the "Autologic Plan") . Each option
granted under the Autologic Plan was granted at an exercise price equal to 100%
(110% in the case of William and Jerome Shaw) of the market value of Autologic's
Common Stock on the date of grant and is exercisable at any time during its
term, commencing one year following the date of grant, subject to earlier
termination at specified times following termination of employment with Volt,
death or disability.
- 7 -
<PAGE>
(2) The percentages reflect, in the case of options granted under the Company
Plan, the percent of total options granted to all employees of the Company
during fiscal 1996 and, in the case of the Autologic Plan, the percent of total
options granted to all employees of Autologic during fiscal 1996.
(3) These values are hypothetical values using assumed compound growth rates
prescribed by the Securities and Exchange Commission and are not intended to
forecast possible future appreciation, if any, in the market price of the
Company's Common Stock.
Stock Option Exercises and Fiscal Year-End Values
The following table sets forth certain information concerning Common Stock of
the Company acquired upon the exercise of stock options to purchase shares of
the Company's Common Stock during the Company's fiscal year ended November 1,
1996 (no options to purchase Common Stock of Autologic were exercised), and
Common Stock of the Company and Autologic subject to unexercised options held at
November 1, 1996, by the executive officers named in the Summary Compensation
table:
<TABLE>
<CAPTION>
Number of Shares Value of
Underlying In-the-Money
Unexercised Options Options
at Fiscal at Fiscal
Shares Year-End Year-End
Acquired Value (Exercisable/ (Exercisable/
Name on Exercise Realized (1) Unexercisable) Unexercisable) (2)
- ---- ----------- ------------ -------------- ------------------
<S> <C> <C> <C> <C>
William Shaw - - 109,000 / 30,000 $3,025,000/ 56,250
Jerome Shaw - - 109,000 / 30,000 3,025,000/ 386,250
James J. Groberg 800 $13,600 5,000 / 18,000 - / 231,750
Irwin B. Robins - - 5,000 / 18,000 - / 231,750
Howard B. Weinreich 3,600 54,975 5,000 / 6,000 54,240/ 77,250
- ------------------
</TABLE>
(1) Represents the closing price of the Company's Common Stock as reported by
The Nasdaq Stock Market's National Market ("NASDAQ/NMS") on the dates of
exercise of the option, minus the option exercise price. None of the options to
purchase Common Stock of Autologic were exercised.
(2) Represents the closing sale price of the Company's Common Stock as reported
by NASDAQ/NMS on November 1, 1996, minus the option exercise price. None of the
options to purchase Common Stock of Autologic were in-the-money.
Standard Compensation of Directors
Each director of the Company who is not an officer or employee of the Company
receives a director's fee at the annual rate of $25,000 and is also reimbursed
for out-of-pocket expenses related to his services.
Employment Agreements
The Company is a party to employment agreements dated as of May 1, 1987 with
William Shaw and Jerome Shaw. These agreements, as amended, provide for the
- 8 -
<PAGE>
continued employment of each in his present executive capacity at an annual base
salary, which is presently $355,000 (subject to increases and additional
compensation, including bonuses, from time to time, at the discretion of the
Board of Directors) until the April 30 which is five years next following the
giving by either the Company or the executive of notice to terminate such
employment. The agreements also provide for service thereafter for the remainder
of the executive's life as a consultant to the Company for annual consulting
fees equal to 75% for the first ten years of the consulting period, and 50% for
the remainder of the consulting period, of his base salary as in effect
immediately prior to the commencement of the consulting period. Upon the death
of the executive, the Company will pay to his beneficiary a death benefit equal
to three times his annual base salary at the date of death (if his death shall
have occurred while employed as an executive), 2.25 times his annual base salary
at the end of his employment as an executive (if his death shall have occurred
during the first ten years of the consulting period) or 1.5 times his annual
base salary at the end of his employment as an executive (if his death shall
have occurred during the remainder of the consulting period). Each employment
agreement permits the executive to accelerate the commencement of the consulting
period if a "change in control" (as defined in the agreements) of the Company
shall occur or if the Company's office where the executive presently performs
his principal services shall be relocated to a different geographical area.
The Company is also a party to an employment agreement dated as of May 1, 1987,
as amended, with Irwin B. Robins, providing for his continued employment as
Senior Vice President and head of the Company's Legal Department until April 30,
1998. Pursuant to the agreement, Mr. Robins is entitled to receive an annual
base salary, which is presently $225,000 (subject to increases and additional
compensation, including bonuses, from time to time, at the discretion of the
Board of Directors). The agreement also provides that, if a "change in control"
(as defined in the agreement) of the Company shall occur and thereafter either
Mr. Robins shall elect to terminate his employment within two years after the
occurrence of certain events (which generally are adverse changes in his
compensation, position, function or location) or his employment shall be
terminated by the Company for any reason other than death, incapacity or "cause"
(as defined in the agreement), Mr. Robins will be entitled to receive (a) his
regular compensation, including benefits, through the date on which his
employment terminates and (b) a lump-sum payment in an amount equal to 2.99
times his "base amount" (as defined in Section 280G (b) (3) of the Code). Mr.
Robins will not be obligated to seek other employment nor mitigate the payment
of the lump sum with any compensation received from other employment.
Under the three employment agreements described above, William Shaw, Jerome Shaw
and Irwin B. Robins are prohibited from engaging in any business competitive
with the Company, competing with the Company for its customers or encouraging
employees of the Company to leave their employment. These restrictions apply for
the duration of the respective agreements and for one year thereafter if the
executive's employment shall have been terminated by the Company "for cause" (as
defined in his agreement). William Shaw and Jerome Shaw will not be bound by
these restrictions after a "change in control" (as defined) of the Company shall
have occurred if, during their respective consulting periods, they shall elect
to terminate their respective employment agreements and thereby relinquish any
further payments or other benefits thereunder.
- 9 -
<PAGE>
Compensation Committee Interlocks and Insider Participation in Compensation
Decisions
To date, all decisions regarding the cash compensation of executive officers
have been made by the entire Board of Directors. Accordingly, William Shaw,
Jerome Shaw, Irwin B. Robins and James J. Groberg, executive officers of the
Company, and Mark N. Kaplan (a partner in the law firm of Skadden, Arps, Slate,
Meagher & Flom, which was retained by the Company during the Company's 1996
fiscal year and may be retained during the Company's 1997 fiscal year)
participated in deliberations of the Company's Board of Directors concerning
executive officer compensation during the year ended November 1, 1996. Each
executive officer who is also a director does not participate in deliberations
as to his own compensation.
Report With Respect to Executive Compensation Committee
Policies regarding the cash compensation of executive officers of the Company
have been determined by the full Board of Directors. As noted earlier in this
Proxy Statement, during most of fiscal 1996, the Company's 1995 Non-Qualified
Stock Option Plan was administered (and options were granted) by the Board's
Stock Option Committee, consisting of Messrs. William Shaw, Mark N. Kaplan and
John R. Torell III. In light of revisions to Securities and Exchange Commission
rules, administration of that plan (including the granting of options
thereunder) was assumed by the full Board on August 26, 1996. Accordingly, the
discussion herein, as it relates to options granted to executive officers other
than William Shaw (whose option was granted by the full Board), is of the Stock
Option Committee.
Executive Compensation. Compensation of executive officers is comprised of
salary as a base compensation, bonuses as a means of short-term compensation and
stock options to foster long-term incentive. All determinations as to the
compensation of each executive officer who is a member of the Company's Board of
Directors is made on an individual by individual basis by the Board, after
consultation with senior management, although an executive officer who is also a
member of the Board does not participate in the Board's determination of his own
compensation.
In making its decisions as to base salary, the Board gives effect to the
executive's performance and responsibilities, inflationary trends, competitive
market conditions and other subjective factors, without affording specific
weights to these factors. Bonuses are based upon the Company's performance, as
well as the executive's overall performance, contribution toward the Company's
profitability, meeting corporate objectives and, in certain instances, meeting
specific corporate goals or completing specific programs or projects. The
compensation (salary and bonuses) of the five executive officers who are not
members of the Board is determined by senior management on the same subjective
basis.
The Company has utilized stock options as the primary method of providing
long-term incentive compensation to key employees, including executive officers,
of the Company and its subsidiaries. The Company believes that stock options
foster the interest of key employees in seeking long-term growth for the
Company, as well as linking their interests with the overall interest of
shareholders. The size of the award to any particular executive or key employee
is not based on any particular mathematical formula, but the Committee takes
- 10 -
<PAGE>
into consideration factors such as the executive's or employee's position, level
of responsibility, value to the Company, objectives, accomplishments,
performance, when the last prior option was granted to the individual, the
individual's other compensation and the recommendation of senior management. No
one factor is given special weight, but decisions are made based on an overall
assessment of the individuals.
Chief Executive Officer Compensation. The fiscal 1996 base salary of William
Shaw, the Company's Chief Executive Officer, remained at an annual rate of
$355,000, which had been implemented during fiscal 1995. In August 1996, the
full Board of Directors determined to grant Mr. Shaw an option to purchase
30,000 shares of the Company's Common Stock at an exercise price equal to 100%
of the market value on the date of grant. The Stock Option Committee of the
Board had intended to grant Mr. Shaw a similar option in April 1996 at the same
time as it granted options to purchase Common Stock of the Company to various
other executive officers and key employees. However, the Company was not able to
do so until certain Securities and Exchange Commission regulations became
effective and were implemented in August 1996. The Board determined the number
of options to be granted to Mr. Shaw utilizing the same criteria as the Stock
Option Committee utilized in granting options to executive officers and other
employees. Additionally, options were granted to Mr. Shaw, as well as to the
other executive officers named in the Cash Compensation Table and certain other
executive officers of the Company, by the Stock Option Committee of the
Company's 59%-owned subsidiary, Autologic Information International, Inc. as
additional incentive.
Certain Tax Legislation. Section 162(m) of the Internal Revenue Code of 1986
("Section 162(m)") precludes a public company from taking a federal income tax
deduction for annual compensation in excess of $1,000,000 paid to its chief
executive officer or any of its four other most highly compensated executive
officers. Certain "performance based compensation" is excluded from the
deduction limitation. Any compensation resulting from the exercise of stock
options granted by the Company should be eligible for exclusion since all
options were either granted prior to the adoption of Section 162(m) or under a
plan approved by the Company's shareholders which was designed to conform with
the requirements of the regulations for determining the conditions under which
options are deemed "performance based compensation". Accordingly, the Committee
believes that the limitations on compensation deductibility under Section 162(m)
will have no effect on the Company in the foreseeable future, and intends to
take such action as may be necessary, including obtaining shareholder approval
where required, in order for compensation not to be subject to the limitation on
deductibility imposed by Section 162(m).
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Board of Directors: William Shaw Jerome Shaw James J. Groberg
Mark N. Kaplan Irwin B. Robins John R. Torell III
Stock Option Committee William Shaw Mark N. Kaplan John R. Torell III
</TABLE>
-11-
<PAGE>
Shareholder Return Performance Graph
The following graph compares the cumulative total shareholder return to holders
of the Company's Common Stock with (a) The NASDAQ Market Index and (b)
securities of companies traded on a national securities exchange or NASDAQ with
market capitalizations that are within 5% of the market capitalization of the
Company's Common Stock as at the end of the Company's latest fiscal year-end
(this peer group was selected by the Company because the Company operates in
five diverse industries). The comparison assumes $100 was invested on November
2, 1991 in the Company's Common Stock and in each of the comparison groups, and
assumes reinvestment of dividends (the Company paid no dividends during the
periods):
[GRAPHIC-GRAPH PLOTTED TO POINTS LISTED BELOW]
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
VOLT INFORMATION SCIENCES, INC. $100 $100 $211 $297 $533 $889
NASDAQ MARKET INDEX 100 97 127 135 160 188
PEER GROUP INDEX 100 105 117 117 144 146
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act requires the Company's executive
officers and directors, and persons who beneficially own more than 10% of the
Company's Common Stock, to file initial reports of ownership, and reports of
changes of ownership, of the Company's equity securities with the Securities and
Exchange Commission and furnish copies of those reports to the Company. Based
solely on a review of the copies of the reports furnished to the Company to date
and written representations that no reports were required, the Company believes
that all reports required to be filed by such persons with respect to the
Company's fiscal year ended November 1, 1996 were timely filed.
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors of the Company has, subject to shareholder ratification,
selected Ernst & Young LLP, independent public accountants, to audit the
Company's financial statements for the fiscal year ending October 31, 1997. A
resolution will be submitted to shareholders at the Annual Meeting for such
ratification. The affirmative vote of a majority of the votes cast at the Annual
Meeting by the holders of shares entitled to vote thereon will be required to
adopt this resolution. Abstentions and broker non-votes will have no effect on
the outcome of the vote on this proposal. The Board of Directors recommends a
vote "FOR" this resolution.
- 12 -
<PAGE>
Ernst & Young LLP has indicated to the Company that it intends to have a
representative present at the Annual Meeting who will be available to respond to
appropriate questions. Such representative will have the opportunity to make a
statement if he so desires. If the resolution selecting Ernst & Young LLP as
independent public accountants is adopted by the shareholders, the Board of
Directors nevertheless retains the discretion to select different auditors
should it then deem it in the Company's best interests. Any such future
selection need not be submitted to a vote of shareholders.
MISCELLANEOUS
New York law permits a corporation to purchase insurance covering a
corporation's obligation to indemnify directors and officers and also covering
directors and officers individually, subject to certain limitations, in
instances in which they may not otherwise be indemnified by the corporation. In
March 1997, the Company renewed, for a period of three years, insurance policies
from National Union Fire Insurance Company of Pittsburgh, PA, Federal Insurance
Company and Columbia Casualty Company covering reimbursement to the Company for
any obligation it incurs as a result of indemnification of officers and
directors and also covering indemnification for officers and directors
individually in certain cases where additional exposure might exist. The annual
premium cost of such policies to the Company is $218,074.
From time to time shareholders may present for consideration at meetings of
shareholders proposals which may be proper subjects for inclusion in the proxy
statement and form of proxy distributed in connection with such meetings. In
order to be so included, such proposals must be submitted in writing on a timely
basis. Shareholder proposals intended to be presented at the 1998 Annual Meeting
of Shareholders must be received by the Company by January 20, 1998. Any such
proposals, as well as any questions relating thereto, should be directed to the
Secretary of the Company, 1221 Avenue of the Americas, New York, New York
10020-1579.
By Order of the Board of Directors
Jerome Shaw,
Secretary
New York, New York
May 20, 1997
- 13 -
<PAGE>
C O M M O N
PROXY
VOLT INFORMATION SCIENCES, INC.
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
Solicited On Behalf Of The Board Of Directors For Annual Meeting Of Shareholders
Of Volt Information Sciences, Inc.
The undersigned hereby appoints WILLIAM SHAW and JEROME SHAW, jointly and
severally, Proxies with full power of substitution, to vote on behalf of the
undersigned at the Annual Meeting of Shareholders of VOLT INFORMATION SCIENCES,
INC. to be held on June 16, 1997, and at adjournments or postponements thereof,
as indicated upon the following matters as described in the Notice of Meeting
and accompanying Proxy Statement related to such meeting, receipt of which is
acknowledged, and with discretionary power upon such other business as may come
before the meeting, according to the number of votes and as fully as the
undersigned would be entitled to vote if personally present, hereby revoking any
prior Proxy or Proxies.
1. The election of the following as nominees to serve as Class II directors
(except as marked to the contrary below):
William Shaw, Jerome Shaw, James J. Groberg
[ ] FOR [ ] WITHHOLD [ ] FOR ALL EXCEPT
INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
2. The proposal to ratify the action of the Board of Directors in appointing
Ernst & Young LLP as the Company's independent auditors for the fiscal year
ending October 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The Board of Directors recommends a vote for the election of each nominee to
serve as a Director and for Proposal 2 set forth in this Proxy.
Each properly executed Proxy will be voted in accordance with the specifications
made above. If no specification is made, the shares represented by this Proxy
will be voted FOR the election of all listed nominees and FOR Proposal 2.
<PAGE>
The Submission Of This Proxy, If Executed Properly,
Revokes All Prior Proxies.
Please be sure to sign and date
this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
VOLT INFORMATION SCIENCES, INC.
NOTE: Please sign your name or names exactly as set forth hereon. For jointly
owned shares, each owner should sign. If signing as attorney, executor,
administrator, trustee or guardian, please indicate the capacity in which you
are acting.
Proxies executed by corporations should be signed by a duly authorized officer.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
<PAGE>
4 0 1 K
PROXY
VOLT INFORMATION SCIENCES, INC.
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
Solicited On Behalf Of The Board Of Directors For Annual Meeting Of Shareholders
Of Volt Information Sciences, Inc.
The undersigned hereby appoints WILLIAM SHAW and JEROME SHAW, jointly and
severally, Proxies with full power of substitution, to vote on behalf of the
undersigned at the Annual Meeting of Shareholders of VOLT INFORMATION SCIENCES,
INC. to be held on June 16, 1997, and at adjournments or postponements thereof,
as indicated upon the following matters as described in the Notice of Meeting
and accompanying Proxy Statement related to such meeting, receipt of which is
acknowledged, and with discretionary power upon such other business as may come
before the meeting, according to the number of votes and as fully as the
undersigned would be entitled to vote if personally present, hereby revoking any
prior Proxy or Proxies.
1. The election of the following as nominees to serve as Class II directors
(except as marked to the contrary below):
William Shaw, Jerome Shaw, James J. Groberg
[ ] FOR [ ] WITHHOLD [ ] FOR ALL EXCEPT
INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
2. The proposal to ratify the action of the Board of Directors in appointing
Ernst & Young LLP as the Company's independent auditors for the fiscal year
ending October 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The Board of Directors recommends a vote for the election of each nominee to
serve as a Director and for Proposal 2 set forth in this Proxy.
Each properly executed Proxy will be voted in accordance with the specifications
made above. If no specification is made, the shares represented by this Proxy
will be voted FOR the election of all listed nominees and FOR Proposal 2.
<PAGE>
The Submission Of This Proxy, If Executed Properly,
Revokes All Prior Proxies.
Please be sure to sign and date
this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
VOLT INFORMATION SCIENCES, INC.
NOTE: Please sign your name or names exactly as set forth hereon. For jointly
owned shares, each owner should sign. If signing as attorney, executor,
administrator, trustee or guardian, please indicate the capacity in which you
are acting.
Proxies executed by corporations should be signed by a duly authorized officer.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
<PAGE>
E S O P
PROXY
VOLT INFORMATION SCIENCES, INC.
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
Solicited On Behalf Of The Board Of Directors For Annual Meeting Of Shareholders
Of Volt Information Sciences, Inc.
The undersigned hereby appoints WILLIAM SHAW and JEROME SHAW, jointly and
severally, Proxies with full power of substitution, to vote on behalf of the
undersigned at the Annual Meeting of Shareholders of VOLT INFORMATION SCIENCES,
INC. to be held on June 16, 1997, and at adjournments or postponements thereof,
as indicated upon the following matters as described in the Notice of Meeting
and accompanying Proxy Statement related to such meeting, receipt of which is
acknowledged, and with discretionary power upon such other business as may come
before the meeting, according to the number of votes and as fully as the
undersigned would be entitled to vote if personally present, hereby revoking any
prior Proxy or Proxies.
1. The election of the following as nominees to serve as Class II directors
(except as marked to the contrary below):
William Shaw, Jerome Shaw, James J. Groberg
[ ] FOR [ ] WITHHOLD [ ] FOR ALL EXCEPT
INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
2. The proposal to ratify the action of the Board of Directors in appointing
Ernst & Young LLP as the Company's independent auditors for the fiscal year
ending October 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The Board of Directors recommends a vote for the election of each nominee to
serve as a Director and for Proposal 2 set forth in this Proxy.
Each properly executed Proxy will be voted in accordance with the specifications
made above. If no specification is made, the shares represented by this Proxy
will be voted FOR the election of all listed nominees and FOR Proposal 2.
<PAGE>
The Submission Of This Proxy, If Executed Properly,
Revokes All Prior Proxies.
Please be sure to sign and date
this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
VOLT INFORMATION SCIENCES, INC.
NOTE: Please sign your name or names exactly as set forth hereon. For jointly
owned shares, each owner should sign. If signing as attorney, executor,
administrator, trustee or guardian, please indicate the capacity in which you
are acting.
Proxies executed by corporations should be signed by a duly authorized officer.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
