<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
BIG CITY RADIO, INC.
- -----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- -----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/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:
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(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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</TABLE>
<PAGE>
BIG CITY RADIO, INC.
11 SKYLINE DRIVE
[LOGO]
HAWTHORNE, NEW YORK 10532
April 28, 2000
Dear Stockholder:
On behalf of the board of directors, I wish to extend to you a cordial
invitation to attend the annual meeting of stockholders of Big City
Radio, Inc., which will be held on Thursday, May 18, 2000 on the Concourse Level
at 1285 Avenue of the Americas, New York, New York 10019 at 3:00 p.m., Eastern
Daylight time. I look forward to greeting as many stockholders as possible at
the annual meeting.
At the annual meeting, holders of class A common stock will be asked to vote
on proposals to elect two class A directors for a one year term ending in the
year 2001 and all stockholders will be asked to vote on proposals to approve and
adopt amendments to our 1999 Incentive Stock Plan to increase the number of
shares of class A common stock that may be issued under the plan from 400,000 to
2,500,000 and to increase the number of shares of class A common stock that may
be issued under the plan to any one optionee from 100,000 to 1,000,000 and to
ratify the selection of KPMG LLP as our independent accountants for the year
ending December 31, 2000 and to vote on any other matters that may properly come
before the annual meeting.
It is important that your shares be represented at the annual meeting,
whether or not you are able to attend. Accordingly, you are urged to sign, date
and mail the enclosed proxy promptly. If you later decide to attend the annual
meeting, you may revoke your proxy and vote in person.
Thank you.
Sincerely,
/s/ Stuart Subotnick
Stuart Subotnick
CHAIRMAN OF THE BOARD OF DIRECTORS
<PAGE>
BIG CITY RADIO, INC.
------------------------
11 SKYLINE DRIVE
HAWTHORNE, NEW YORK 10532
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 18, 2000
------------------------
TO THE STOCKHOLDERS OF
BIG CITY RADIO, INC.:
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Big City
Radio, Inc., a Delaware corporation, will be held on Thursday, May 18, 2000, at
3:00 p.m., Eastern Daylight time, on the Concourse Level, 1285 Avenue of the
Americas, New York, New York 10019.
At the annual meeting, holders of class A common stock, par value $.01 per
share, will be asked to consider and vote as a separate class upon the election
of two members to Big City Radio's board of directors to serve a one-year term
as class A directors (Proposal 1).
At the annual meeting, holders of class A common stock together with holders
of class B common stock, par value $.01 per share, will be asked to consider and
vote as a single class upon the approval and adoption of amendments to our 1999
Incentive Stock Plan to increase the number of shares of class A common stock
that may be issued under the plan from 400,000 to 2,500,000 and to increase the
number of shares of class A common stock that may be issued under the plan to
any one optionee from 100,000 to 1,000,000 (Proposal 2) and the ratification of
the selection of KPMG LLP as our independent accountants for the year ending
December 31, 2000 (Proposal 3) and to vote upon the transaction of such other
business as may properly come before the annual meeting or any adjournment
thereof. The board of directors is not aware of any other business that will be
presented for consideration at the annual meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" PROPOSALS 1, 2 AND 3 AT THE ANNUAL MEETING.
Only stockholders of record at the close of business on March 27, 2000, the
record date, will be entitled to notice of and to vote at the annual meeting or
any adjournments thereof. The annual meeting may be adjourned from time to time
without notice other than by announcement at the annual meeting. A list of
stockholders entitled to vote at the annual meeting will be available for
inspection by any stockholder, for any reason germane to the annual meeting,
during ordinary business hours during the ten (10) days prior to the annual
meeting at the law offices of Paul, Weiss, Rifkind, Wharton and Garrison, LLP,
1285 Avenue of the Americas, New York, New York 10019.
We hope that you will be able to attend the annual meeting in person.
However, whether or not you plan to attend the meeting in person, please
complete, sign, date and mail the enclosed proxy in the return envelope to
assure your shares are represented and voted at the annual meeting. If you do
attend the annual meeting, you may revoke your proxy if you wish and vote in
person. Thank you for your cooperation and continued support.
By Order of the Board of Directors,
/s/ Arnold L. Wadler
Arnold L. Wadler
Secretary
Hawthorne, New York
April 28, 2000
<PAGE>
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING
REGARDLESS OF THE NUMBER OF SHARES YOU HOLD IN ORDER THAT A QUORUM MAY BE
ASSURED, WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE ANNUAL MEETING IN PERSON.
PLEASE COMPLETE, SIGN, DATE AND MAIL THE ENCLOSED PROXY IN THE ACCOMPANYING
RETURN ENVELOPE (TO WHICH NO POSTAGE NEED BE AFFIXED BY THE SENDER IF MAILED
WITHIN THE UNITED STATES). IF YOU RECEIVE MORE THAN ONE PROXY BECAUSE YOUR
SHARES ARE REGISTERED IN DIFFERENT NAMES OR ADDRESSES, EACH SUCH PROXY SHOULD BE
SIGNED AND RETURNED TO ASSURE THAT ALL OF YOUR SHARES WILL BE VOTED. THE PROXY
SHOULD BE SIGNED BY ALL REGISTERED HOLDERS EXACTLY AS THE STOCK IS REGISTERED.
<PAGE>
BIG CITY RADIO, INC.
------------------------
11 SKYLINE DRIVE
HAWTHORNE, NEW YORK 10532
------------------------
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 18, 2000
------------------------
This proxy statement, the accompanying notice of annual meeting and proxy
card are being furnished to the holders of shares of class A common stock, par
value $.01 per share, and to the holders of shares of class B common stock, par
value $.01 per share, of Big City Radio, Inc., a Delaware corporation, in
connection with the solicitation of proxies by our board of directors for use at
our annual meeting to be held at 3:00 p.m., Eastern Daylight Time, on Thursday,
May 18, 2000 on the Concourse Level, 1285 Avenue of the Americas, New York, New
York 10019, and any adjournments of the annual meeting. This proxy statement and
the accompanying notice of annual meeting and proxy card, along with our annual
report to stockholders for the year ended December 31, 1999 are being mailed to
our stockholders on or about April 28, 2000.
INFORMATION REGARDING THE ANNUAL MEETING
PROPOSALS. At the annual meeting, holders of the class A common stock will
be asked to consider and vote as a separate class upon the election of two
members to our board of directors to serve a one-year term as class A directors
(Proposal 1), and holders of the class A common stock together with holders of
the class B common stock will be asked to consider and vote as a single class
upon approval and adoption of amendments to our 1999 Incentive Stock Plan to
increase the number of shares of class A common stock that may be issued under
the plan from 400,000 to 2,500,000 and to increase the number of shares of
class A common stock that may be issued under the plan to any one optionee from
100,000 to 1,000,000 (Proposal 2) and the ratification of the selection of KPMG
LLP as our independent accountants for the year ending December 31, 2000
(Proposal 3), and to vote upon such other matters as may properly come before
the annual meeting.
Our board of directors knows of no business that will be presented for
consideration at the annual meeting other than the matters described in this
proxy statement.
RECORD DATE; QUORUM. Only holders of record of common stock as of the close
of business on March 27, 2000, the record date, will be entitled to notice of
and to vote at the annual meeting. As of the record date, there were 6,218,817
shares of class A common stock outstanding and entitled to vote at the annual
meeting, held by approximately 34 stockholders of record, which number includes
nominees for an undeterminable number of beneficial owners, with each share
entitled to one vote and 8,250,458 shares of class B common stock outstanding
and entitled to vote at the annual meeting, held by three stockholders of
record, with each share entitled to ten votes on each matter voted upon. The
presence of one-third of the outstanding shares of common stock entitled to vote
at the annual meeting, present in person or represented by proxy, is necessary
to constitute a quorum at the annual meeting. Broker non-votes, shares of common
stock represented by proxies marked "ABSTAIN" for any proposal presented at the
annual meeting and shares of common stock held by persons in attendance at the
annual meeting who abstain from voting on any such proposal will be counted for
purposes of determining the presence of a quorum.
VOTE REQUIRED. The affirmative vote of the holders of a plurality of shares
of class A common stock voting as a separate class present in person or
represented by proxy and entitled to vote at the annual meeting will be required
to elect each of the class A directors to our board of directors. The
affirmative vote of the holders of a majority of shares of common stock voting
as a single class present in person or represented by proxy and entitled to vote
at the annual meeting will be required to approve and adopt Proposals 2 and 3
which will be voted upon separately at the annual meeting. In voting on each
matter, holders of class A common stock are entitled to one vote per share and
holders of class B common stock are entitled to ten votes per share.
<PAGE>
Stockholders who hold their shares through an intermediary must provide
instructions on voting as requested by their banks or brokers. Votes cast by
proxy or in person at the annual meeting will be tabulated by one or more
inspectors of election appointed by our board of directors. These inspectors of
election will also determine whether a quorum is present for the transaction of
business.
Shares of common stock represented by proxies marked "ABSTAIN" for any
proposal presented at the annual meeting and shares of common stock held by
persons in attendance at the annual meeting who abstain from voting on any such
proposal will not be voted for or against such proposal. Broker non-votes will
not be voted for or against a proposal. Because of the vote required to approve
the proposals presented at the annual meeting, abstentions and broker non-votes
will have the effect of a vote against such proposals (except with respect to
Proposal 1). Because only a plurality is required for the election of directors,
abstentions and broker non-votes will have no effect on the election of
directors.
PROXIES. All properly executed proxy cards delivered pursuant to this
solicitation and not revoked will be voted at the annual meeting in accordance
with the directions given. In voting by proxy with regard to the election of
directors, the stockholders entitled to vote upon such election may vote in
favor of all nominees, withhold their votes as to all nominees or withhold their
votes as to specific nominees. With regard to other proposals, the stockholders
may vote in favor of each proposal or against each proposal, or in favor of some
proposals and against others, or may abstain from voting on any or all
proposals. Stockholders should specify their respective choices on the
accompanying proxy card. If no specific instructions are given with regard to
the matters to be voted upon, the shares of common stock represented by a signed
proxy card will be voted "FOR" Proposals 1, 2 and 3 listed on the proxy card. If
any other matters properly come before the annual meeting, the persons named as
proxies will vote upon such matters according to their judgment.
All proxies delivered pursuant to this solicitation are revocable at any
time prior to the annual meeting at the option of the stockholders executing
them by giving written notice of revocation to our corporate Secretary, by
delivering a duly executed proxy card bearing a later date or by attending and
voting in person at the annual meeting. Attendance at the annual meeting will
not in itself constitute revocation of a proxy. All written notices of
revocation and other communications with respect to revocations of proxies
should be addressed to: Big City Radio, Inc., c/o Metromedia Company, One
Meadowlands Plaza, East Rutherford, NJ 07073-2137, Attention: Arnold L. Wadler,
Secretary.
Proxies will initially be solicited by us by mail, but directors, officers
and selected employees may solicit proxies from stockholders personally or by
telephone, facsimile or other forms of communication. Such directors, officers
and employees will not receive any additional compensation for such
solicitation. We will also request brokerage houses, nominees, fiduciaries and
other custodians to forward soliciting materials to beneficial owners, and we
will reimburse such persons for their reasonable expenses incurred in doing so.
All expenses incurred in connection with the solicitation of proxies will be
borne by us.
2
<PAGE>
SECURITY OWNERSHIP
The following table sets forth, as of the record date, certain information
regarding the beneficial ownership of each class of common stock by (i) each
person known to own beneficially more than 5% of the outstanding shares of each
class of common stock, (ii) each of our directors and director nominees,
(iii) each executive officer named in the Summary Compensation Table under
"Executive Compensation" and (iv) all of our directors and executive officers as
a group. In accordance with the rules promulgated by the Securities and Exchange
Commission, such ownership includes shares currently owned as well as shares
which the named person has the right to acquire beneficial ownership of within
60 days, including, but not limited to, shares which the named person has the
right to acquire through the exercise of any option, warrant or right, or
through the conversion of a security. Accordingly, more than one person may be
deemed to be a beneficial owner of the same securities. Except as otherwise
indicated, each stockholder listed below has sole voting and investment power
with respect to shares beneficially owned by such person.
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES OF OUTSTANDING
COMMON STOCK CLASS OF COMMON
TITLE OF CLASS NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED(1) STOCK(2)
- -------------- -------------------------------------- --------------------- ---------------
<S> <C> <C> <C>
Class B Common Stock Stuart Subotnick, Anita Subotnick..... 8,250,458(3) 100.0%
Class A Common Stock Stuart Subotnick, Anita Subotnick..... 50,735(4) *
Michael H. Boyer...................... 25,000(5) *
Charles M. Fernandez.................. 530,000(6) 8.2%
Gilder, Gagnon, Howe & Co............. 516,575(7) 8.3%
Michael Kakoyiannis................... 1,205,317(8) 19.4%
Silvia Kessel......................... 39,140(9) *
Alan D. Kirschner..................... 82,128(10) 1.3%
Earl I. Mack.......................... 832,800(11) 13.3%
Bryan Subotnick....................... 77,000(12) 1.2%
T. Rowe Price Associates, Inc......... 400,000(13) 6.4%
Paul R. Thomson....................... 82,000(12) 1.2%
Arnold L. Wadler...................... 38,000(9) *
Leonard White......................... 25,000(5) *
Yunyung C. Portugal................... 12,220(14) *
All Directors and Executive Officers
as a Group (11 persons)............... 9,211,681(15) 63.7%
</TABLE>
- ------------------------
* Holdings do not exceed one percent of the total outstanding shares of any
class of common stock.
(1) Unless otherwise indicated by footnote, the named individuals have sole
voting and investment power with respect to the shares of common stock
beneficially owned.
(2) The percentage of outstanding shares of class A common stock shown does not
include outstanding shares of class B common stock or shares of class A
common stock issuable upon conversion of the class B common stock.
(3) Includes 2,000,000 shares of class B common stock owned by Subotnick
Partners, L.P. of which Anita Subotnick is general partner and Stuart
Subotnick is a limited partner. The shares of class B common stock are
convertible into shares of class A common stock at the rate of one share of
class A common stock for each share of class B common stock and the holders
of shares of class B common stock are entitled to 10 votes per share and to
vote as a separate class to elect 75% of the members of our board of
directors. Mr. and Mrs. Subotnick have shared voting and investment power
with respect to their shares. Mr. and Mrs. Subotnick's address is c/o
Metromedia Company, 810 Seventh Avenue, 29(th) Floor, New York, New York
10019.
3
<PAGE>
(4) Includes 45,000 shares of class A common stock issuable upon exercise of
options which are currently exercisable at an exercise price of $3.5625 per
share and 5,735 shares of class A common held by Mr. and Mrs. Subotnick as
custodian for their grandchildren's account pursuant to the New York Uniform
Gift to Minors Act.
(5) Includes 22,500 shares of class A common stock issuable upon exercise of
options which are currently exercisable at an exercise price of $3.5625 per
share and 2,500 shares of class A common stock issuable upon exercise of
options that are currently exercisable at an exercise price of $7.125 per
share.
(6) Includes 250,000 shares of class A common stock issuable upon exercise of
options which are currently exercisable at an exercise price of $4.00 per
share.
(7) Pursuant to a report on Schedule 13G filed with the Securities and Exchange
Commission on February 15, 2000, Gilder, Gagnon, Howe & Co. a broker/dealer
under Section 15 of the Securities Exchange Act of 1934, is the beneficial
owner of 516,575 shares of class A common stock.
(8) Mr. Kakoyiannis' address is 138 Cambridge, Garden City, New York 11530.
(9) Includes 20,000; 2,000 and 10,000 shares of class A common stock issuable
upon exercise of options that are currently exercisable at an exercise price
of $7.00, $7.8125 and $3.5625 per share, respectively.
(10) Includes 25,000; 20,000; 4,000; 31,000 and 2,000 shares of class A common
stock issuable upon exercise of options that are currently exercisable at an
exercise price of $6.00, $7.00, $7.8125, $3.4375 and $4.313 per share,
respectively.
(11) Includes 20,000 shares of class A common stock issuable upon exercise of
options that are currently exercisable at an exercise price of $3.5625 and
812,800 shares of class A common stock as reported on Schedule 13D/A filed
with the Securities and Exchange Commission on January 4, 2000. Mr. Mack's
address is 370 West Passaic Street, Rochelle Park, New Jersey 07662.
(12) Includes 25,000; 20,000; 4,000; 6,000; 2,000 and 20,000 shares of class A
common stock issuable upon exercise of options that are currently
exercisable at an exercise price of $6.00, $7.00, $7.8125, $3.4375, $4.313
and $3.5625 per share, respectively.
(13) Pursuant to a report on Schedule 13G/A filed with the Securities and
Exchange Commission on February 2, 2000, these shares are owned by various
individuals and institutional investors including T. Rowe Price Small-Cap
Value Fund, Inc. (which owns 400,000 shares representing 6.4% of the shares
outstanding), which T. Rowe Price Associates, Inc. ("Price Associates")
serves as investment adviser with power to direct investments and/or sole
power to vote the shares. For purposes of the Securities Exchange Act of
1934, Price Associates is deemed to be a beneficial owner of such
securities, however, Price Associates expressly disclaims that it is the
beneficial owner of such securities. The business address of T. Rowe Price
Associates is 100 East Pratt Street, Baltimore, Maryland 21202.
(14) Includes 12,000 shares of class A common stock issuable upon exercise of
options that are currently exercisable at an exercise price of $7.8125 per
share.
(15) Includes 150,000; 5,000; 100,000; 28,000; 75,000; 43,000 and 40,000 shares
of class A common stock issuable upon exercise of options that are currently
exercisable at an exercise price of $3.5625, $7.125, $7.00, $7.8125, $6.00,
$3.4375 and $4.313 per share, respectively and 8,250,458 shares of class B
common stock.
The foregoing information is based on a review, as of the record date, by us
of statements filed with the Securities and Exchange Commission under Sections
13(d) and 13(g) of the Securities Exchange Act of 1934, as amended. To the best
of our knowledge, except as set forth above, no other person owns beneficially
more than 5% of the outstanding common stock.
4
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS
EXECUTIVE OFFICERS OF BIG CITY RADIO
The following table sets forth certain information regarding our executive
officers as of the date of this report.
<TABLE>
<CAPTION>
NAME AGE OFFICE OR POSITION HELD
- ---- -------- -----------------------
<S> <C> <C>
Charles M. Fernandez................. 38 President and Chief Executive Officer
Alan D. Kirschner.................... 48 Vice President--Engineering
Bryan Subotnick...................... 36 Executive Vice President--Corporate Development
Paul R. Thomson...................... 43 Vice President, Chief Financial Officer and Treasurer
Yunyung C. Portugal.................. 38 Corporate Controller
Silvia Kessel........................ 49 Executive Vice President
Arnold L. Wadler..................... 56 Executive Vice President, General Counsel and Secretary
</TABLE>
Set forth below is the background of each of our executive officers other
than those who are also directors (for the backgrounds of each of our directors,
including biographical information, see "PROPOSAL NO. 1--ELECTION OF DIRECTORS"
below).
ALAN D. KIRSCHNER has been a Vice President since September 1997 and
Director of Engineering since July 1995. Mr. Kirschner has been serving as radio
technical consultant for AM and FM radio stations since 1972. Mr. Kirschner
served as Chief Engineer responsible for technical operations of radio station
WYNY owned by Broadcasting Partners, Inc. and Evergreen Media, in New York from
1993 to 1995 and a Director of Engineering for Westwood One Stations Group in
New York from 1988 to 1993.
BRYAN SUBOTNICK has served as Executive Vice President--Corporate
Development since September 1997. Mr. Subotnick served as Vice President from
January 1997 and Director of Operations from May 1995 to December 1996. Prior to
joining us, Mr. Subotnick was Vice President and General Counsel of
Papamarkou & Company, an international finance and investment company, in 1995,
and as a General Partner in the law firm of Shanker & Subotnick, which
specialized in entertainment law, from 1992 to 1994, Mr. Subotnick is the son of
Stuart Subotnick, our Chairman of the board of directors, and of Anita
Subotnick, one of our directors.
PAUL R. THOMSON has served as Vice President since September 1997 and as
Chief Financial Officer since January 1996. Prior to joining us, Mr. Thomson
served as Corporate Controller of Herbalife International, Inc. from 1993 to
1996, as Chief Financial Officer of Barnard Salick Companies from 1992 to 1993
and as Controller--Radio Stations Group of Westwood One, Inc. from 1989 to 1992.
Prior to 1989, Mr. Thomson worked with Price Waterhouse LLP for 12 years in
London, Caracas and Los Angeles. He is a certified public accountant and a
member of the Institute of Chartered Accountants in England and Wales.
YUNYUNG C. PORTUGAL has served as Corporate Controller since September 1997
and as Business Manager of our Los Angeles stations from March 1996 to
September 1997. Prior to joining us Ms. Portugal served as Manager of General
Accounting of Herbalife International, Inc. from 1989 to 1994.
DIRECTORS OF BIG CITY RADIO
Our amended and restated certificate of incorporation provides that our
board of directors shall initially consist of eight members: six directors to be
elected by the holders of class B common stock and two Directors to be elected
by the holders of class A common stock. The board of directors currently
5
<PAGE>
consists of five class B directors and two class A directors. The class B
directors are Mr. Stuart Subotnick, Mrs. Anita Subotnick, Mr. Charles M.
Fernandez, Ms. Silvia Kessel and Mr. Arnold L. Wadler. The class A directors are
Mr. Leonard L. White and Mr. Michael H. Boyer. Holders of the class B common
stock remain entitled to elect one additional class B director.
Directors of each class will hold office until their successors are elected
and qualified or until their earlier death, resignation or removal. Our amended
and restated by-laws provide that the class A directors will be elected by a
plurality of the votes cast at a meeting of stockholders (or stockholders acting
by written consent) by the holders of class A common stock entitled to vote at
the election, voting as a separate class, and that class B directors will be
elected by a plurality of the votes cast at a meeting of stockholders (or
stockholders acting by written consent) by the holders of class B common stock
entitled to vote at the election, voting as a separate class.
The class A directors and class B directors are nominated for election by a
class A nominating committee and a class B nominating committee, respectively.
For more information regarding the class A nominating committee and the class B
nominating committee and their respective members, see "Meetings of Certain
Committees of the Board" below. In addition, nominations for election of
class A directors only to our board of directors may be made at an annual or
special meeting of stockholders called by the board of directors for the purpose
of electing directors, by any holder of the class A common stock entitled to
vote for the election of directors at such meeting. Such nominations shall be
made pursuant to timely notice in writing to our corporate Secretary. To be
timely, a stockholder's notice must be delivered to or mailed and received at
our principal executive offices not less than 60 days nor more than 90 days
prior to the scheduled date of the meeting, regardless of any postponement,
deferral or adjournment of that meeting to a later date; PROVIDED, HOWEVER, that
if less than 70 days' notice or prior public disclosure of the date of the
meeting is given or made to stockholders, notice by the stockholder to be timely
must be so delivered or received not later than the close of business on the
10th day following the earlier of (i) the day on which such notice of the date
of the meeting was mailed or (ii) the day on which such public disclosure was
made. A stockholder's notice to our Secretary shall set forth (i) as to each
person whom the stockholder proposes to nominate for election or reelection as a
director (a) the name, age, business address and residence address of such
person, (b) the principal occupation or employment of such person, (c) the class
and number of our shares of stock which are beneficially owned by such person on
the date of such stockholder's notice and (d) any other information relating to
such person that is required to be disclosed in solicitations of proxies for
election of directors, or is otherwise required in each case pursuant to
Regulation 14A under the Exchange Act (including, without limitation, such
person's written consent to being named in the proxy statement as a nominee and
to serving as a director, if elected); (ii) as to the stockholder giving the
notice (a) the name and address, as they appear on our corporate books, of such
stockholder and any other stockholders known by such stockholder to be
supporting such nominee(s), (b) the class and number of shares of stock of Big
City Radio which are beneficially owned by such stockholder on the date of such
stockholder's notice and by any other stockholders known by such stockholder to
be supporting such nominee(s) on the date of such stockholder's notice, (c) a
representation that the stockholder is a holder of record of our stock entitled
to vote at such meeting and intends to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice; and (iii) a
description of all arrangements or understandings between the stockholder and
each nominee and other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by the
stockholder. Any such nominations should be submitted in writing to Big City
Radio, Inc., c/o Metromedia Company, One Meadowlands Plaza, East Rutherford, New
Jersey 07073-2137, Attention: Secretary.
Directors may be removed, with or without cause, only by the holders of the
class or classes of common stock or series of preferred stock, if any, that, as
of the date such removal is effected, would be entitled to elect such directors
at the next annual meeting of stockholders. Newly created directorships
resulting from an increase in the number of directors and vacancies occurring on
the board of directors for
6
<PAGE>
any reason, including the removal of directors without cause, may be filled only
by (i) the affirmative vote of a majority of the remaining directors elected by
holders of each class or classes of common stock or series of preferred stock,
if any, that (x) elected such directors and (y) as of the date such vacancy is
filled, would be entitled to elect such directors at the next annual meeting of
stockholders or (ii) if there are no such remaining directors, then by a
plurality of the votes cast by the holders of the class or classes of common
stock or series of preferred stock, if any, that, as of the date such vacancy is
filled, would be entitled to elect such directors at the next annual meeting of
stockholders, voting as a separate class at a meeting, special or otherwise, of
the holders of common stock of such class or classes or series of preferred
stock, if any.
For more information regarding each of Big City Radio's directors, including
biographical information, see "PROPOSAL 1--ELECTION OF DIRECTORS."
MEETINGS AND CERTAIN COMMITTEES OF THE BOARD
The board of directors held four regular meetings during 1999. All directors
attended at least 75% of the aggregate total number of meetings of the board of
directors and all committees of the board of directors on which they serve.
The board of directors has delegated certain functions to the following
standing committees:
THE EXECUTIVE COMMITTEE. The executive committee was created on
December 24, 1997 and is authorized to exercise, to the extent permitted by law,
all of the powers of the board of directors in the management or corporate
matters including, without limitation, the power and authority to declare a
dividend, to authorize the issuance of stock or to adopt a certificate of
ownership and merger in connection with our merger or the merger of any of our
subsidiaries. The executive committee took action by unanimous written consent
four times in 1999. The members of the executive committee are Mr. Stuart
Subotnick and Ms. Silvia Kessel.
THE AUDIT COMMITTEE. The audit committee was created on March 25, 1998 and
is responsible for (a) making recommendations concerning the engagement of
independent public accountants, (b) approving the professional services provided
by our independent auditors, (c) reviewing, in consultation with our independent
auditors, the plans and results of the audit engagement, (d) reviewing the
independence of our independent auditors, (e) considering the range of audit and
non-audit fees and (f) reviewing the adequacy of our internal accounting
controls. The audit committee held four meetings in 1999. The members of the
audit committee are Mr. Michael H. Boyer, Mr. Leonard White and Ms. Silvia
Kessel.
THE COMPENSATION COMMITTEE. The compensation committee was created on
March 25, 1998 and its function is to review, approve, recommend and report to
the board of directors on matters specifically relating to the compensation of
our executive officers and other key executives and to administer our stock
option plans. The compensation committee held one meeting in 1999. In addition,
the compensation committee took action by unanimous written consent four times
in 1999. The members of the compensation committee are Mr. Michael H. Boyer and
Mr. Leonard White.
THE NOMINATING COMMITTEES. The class A nominating committee and the
class B nominating committee were created on December 24, 1997 and
(i) establish criteria and procedures for the election of the class A directors
and the class B directors, respectively, (ii) review management's evaluation of
any officers proposed for nomination as class A director or class B director, as
applicable, (iii) review the qualifications of and, when necessary and
appropriate, interview candidates who may be proposed for nomination as class A
director or class B director, as applicable, (iv) recommend to the entire board
of directors a slate of class A directors or class B directors, as applicable,
to be elected for the following year and (v) perform such other duties in
connection with the selection, election or termination of the directors as the
board of directors may request. The nominating committee did not hold any formal
meetings in 1999. The current
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member of the class A nominating committee is Mr. Leonard White and the current
members of the class B nominating committee are Mr. Stuart Subotnick and
Ms. Anita Subotnick.
COMPENSATION OF DIRECTORS
Directors who are officers, employees or affiliates receive no compensation
for their services as directors. Accordingly, Messrs. Subotnick, Fernandez and
Wadler and Ms. Kessel and Mrs. Subotnick do not receive compensation for their
services as directors. Each director who is not also an officer, employee or
affiliate is entitled to receive annual directors' fees of $20,000, an
additional $1,200 for each board of directors meeting attended ($500 if attended
by conference telephone call) and $500 for each committee meeting attended.
Outside directors are eligible to participate in the Big City Radio 1999
Incentive Stock Plan pursuant to which options to purchase 2,500 shares of
class A common stock will be granted to each outside director immediately upon
such director's initial election and qualification for the board of directors.
Options to purchase 2,500 shares of class A common stock will be granted
annually on the day of each annual stockholders' meeting. Each outside director
is eligible to receive options to purchase a maximum of 25,000 shares of
class A common stock pursuant to the Incentive Stock Plan. Each option will have
an exercise price equal to the fair market value of a share of class A common
stock on the date of grant. All such options granted to outside directors will
be immediately exercisable. On November 1, 1999, the board of directors granted
to each of our outside directors, Messrs. Boyer and White, options under the
1999 Incentive Stock Plan to purchase up to 22,500 shares of class A common
stock at an exercise price of $3.5625 per share.
8
<PAGE>
EXECUTIVE COMPENSATION
The following Summary Compensation Table sets forth information on
compensation awarded to, earned by or paid to our Chief Executive Officer and
our four other most highly compensated executive officers whose individual
compensation exceeded $100,000 during the years ended December 31, 1999, 1998
and 1997 for services rendered in all capacities to Big City Radio and its
subsidiaries. The persons listed in the table below are referred to as the
"Named Executive Officers."
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION AWARDS
ANNUAL --------------------------------
COMPENSATION SECURITIES
-------------------- RESTRICTED STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) AWARD(S)($) STOCK OPTIONS COMPENS.($)
- --------------------------- -------- --------- -------- ---------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Charles M. Fernandez............... 1999 * * -- 250,000 --
President and Chief Executive 1998 -- -- -- -- --
Officer(1) 1997 -- -- -- -- --
Michael Kakoyiannis................ 1999 300,000 60,000 -- -- --
Former President and Chief 1998 300,000 50,000 796,918(3) -- --
Executive Officer(2) 1997 300,000 75,000 -- -- --
Paul R. Thomson.................... 1999 210,000 30,000 -- 120,000(4) --
Vice President and Chief Financial 1998 187,500 25,000 -- 10,000(5) --
Officer 1997 175,000 30,000 -- 75,000(6) --
Bryan Subotnick.................... 1999 150,000 -- -- 120,000(4) --
Executive Vice President--Corporate 1998 125,000 10,000 -- 10,000(5) --
Development 1997 100,000 -- -- 75,000(6) --
Alan D. Kirschner.................. 1999 150,000 25,000 -- 120,000(7) --
Vice President--Engineering 1998 110,000 15,000 -- 10,000(5) --
1997 94,000 5,000 -- 75,000(6) --
</TABLE>
- ------------------------
(1) Mr. Fernandez was appointed President and Chief Executive Officer on
November 1, 1999, thus preceding years' compensation is not applicable. The
amount of annual compensation paid to Mr. Fernandez for 1999 is less than a
full year of compensation and is less than $100,000.
(2) Michael Kakoyiannis served as President and Chief Executive from 1994
through October 31, 1999.
(3) Pursuant to his employment agreement, Mr. Kakoyiannis was entitled to
receive 93,755 shares of class A common stock for every 20% increase in the
average closing price of the class A common stock following our initial
public offering (up to a maximum of 281,265 shares). On August 3, 1998,
93,755 shares were issued to Mr. Kakoyiannis under his employment agreement.
The closing price of the class A common stock on August 3, 1998 as reported
by the American Stock Exchange was $8.50 per share. No shares were issued to
Mr. Kakoyiannis under his employment agreement in 1997 or 1999.
(4) Includes options to purchase 15,000 shares of class A common stock granted
on January 28, 1999 at an exercise price of $3.4375 per share of which 6,000
are presently exercisable and the remainder of which become exercisable in
three annual installments on each anniversary of the grant date and options
to purchase 5,000 shares of class A common stock granted on March 11, 1999
at an exercise price of $4.313 per share of which 2,000 are presently
exercisable and the remainder of which become exercisable in three annual
installments on each anniversary of the grant date and options to purchase
9
<PAGE>
100,000 shares of class A common stock granted on November 1, 1999 at an
exercise price of $3.5625 per share of which 20,000 are presently
exercisable and the remainder of which become exercisable in four annual
installments on each anniversary of the grant date.
(5) Options to purchase 10,000 shares of class A common stock granted on
July 6, 1998 at an exercise price of $7.8125 per share, 2,000 of which are
presently exercisable and the remainder of which become exercisable in four
annual installments on each anniversary of the grant date.
(6) Includes options to purchase 25,000 shares of class A common stock at an
exercise price of $6.00 per share, exercisable immediately and options to
purchase 50,000 shares of class A common stock at an exercise price of $7.00
per share, 10,000 shares of which are presently exercisable and the
remainder of which will become exercisable in four annual installments on
each anniversary of the grant date.
(7) Includes options to purchase 15,000 shares of class A common stock granted
on January 28, 1999 at an exercise price of $3.4375 per share of which 6,000
are presently exercisable and the remainder of which become exercisable in
three annual installments on each anniversary of the grant date and options
to purchase 5,000 shares of class A common stock granted on March 11, 1999
at an exercise price of $4.313 per share of which 2,000 are presently
exercisable and the remainder of which become exercisable in three annual
installments on each anniversary of the grant date and options to purchase
100,000 shares of class A common stock granted on October 20, 1999 at an
exercise price of $3.4375 per share of which 25,000 are presently
exercisable and the remainder of which will become exercisable in three
annual installments on each anniversary of the grant date.
During 1999, Mr. Wadler and Ms. Kessel, each of whom serves as an executive
officer, were employed and paid by Metromedia Company. On November 1, 1999 our
board of directors granted to each of Mr. Wadler and Ms. Kessel options to
purchase up to 50,000 shares of class A common stock at an exercise price of
$3.5625 per share. No other amounts were paid by us to such named executive
officers or to Metromedia Company for services during 1999.
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<PAGE>
OPTION/SAR GRANTS
DURING THE YEAR ENDED DECEMBER 31, 1999
The following table sets forth individual grants of stock options pursuant
to our Incentive Stock Plans to the named executive officers during the fiscal
year ended December 31, 1999. The Incentive Stock Plans do not provide for stock
appreciation rights and Big City Radio did not grant any stock appreciation
rights during the fiscal year ended December 31, 1999. All options listed below
were granted pursuant to the 1998 and 1999 Incentive Stock Plans.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES % OF TOTAL OPTIONS
UNDERLYING GRANTED TO EMPLOYEES IN EXERCISE EXPIRATION GRANT-DATE
NAME OPTIONS GRANTED (#) FISCAL YEAR PRICE($/SH) DATE VALUE(1)
- ---- -------------------- ----------------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Charles M. Fernandez... 250,000 29.7% $ 4.00 11/1/2009 $583,750
Michael Kakoyiannis.... -- -- -- -- --
Paul R. Thomson........ 100,000 11.9 3.5625 11/1/2009 241,600
15,000 .8 3.4375 1/28/2009 33,825
5,000 .6 4.313 3/11/2009 14,220
Bryan Subotnick........ 100,000 11.9 3.5625 11/1/2009 241,600
15,000 .8 3.4375 1/28/2009 33,825
5,000 .6 4.313 3/11/2009 14,220
Alan D. Kirschner...... 100,000 11.9 3.4375 10/20/2009 232,800
15,000 .8 3.4375 1/28/2009 33,825
5,000 .6 4.313 3/11/2009 14,220
</TABLE>
- ------------------------
(1) The modified Black-Scholes method of option valuation has been used to
determine grant date present value. The assumptions used in the
Black-Scholes option valuation calculation are (i) estimated future annual
stock price volatility of 50%; (ii) a United States risk free rate of return
of 5.85%; (iii) a future dividend yield of 0%; and (iv) an expected life of
ten years.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
The following table sets forth the exercise of stock options during the year
ended December 31, 1999, by each of the named executive officers and the
year-end value of unexercised options.
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES ACQUIRED VALUE FISCAL YEAR-END(#) FISCAL YEAR-END($)
ON EXERCISE(#) REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(1)
--------------- ----------- ------------------------- ----------------------------
<S> <C> <C> <C> <C>
Charles M. Fernandez.... -- -- 250,000/0 18$7,500/0
Michael Kakoyiannis..... -- -- -- --/--
Paul R. Thomson......... -- -- 77,000/128,000 32,499/106,817
Bryan Subotnick......... -- -- 77,000/128,000 32,499/106,817
Alan D. Kirschner....... -- -- 82,000/123,000 41,562/98,438
</TABLE>
- ------------------------
(1) Calculated based on a closing price for the class A common stock of $4.75 as
reported by the American Stock Exchange on December 31, 1999.
11
<PAGE>
EMPLOYMENT AGREEMENTS OF NAMED EXECUTIVE OFFICERS
We have entered into employment agreements with the following named
executive officers: Messrs. Charles M. Fernandez, Alan D. Kirschner, Paul R.
Thomson and Michael Kakoyiannis.
EMPLOYMENT AGREEMENT WITH CHARLES M. FERNANDEZ
We are party to an employment agreement with Mr. Fernandez that provides for
Mr. Fernandez's employment as President and Chief Executive Officer through
October 31, 2002. Mr. Fernandez's employment agreement provides for an annual
base salary of $450,000, subject to cost of living increases in each subsequent
contract year of not less than 5% of the annual base salary in the immediate
preceding year. Mr. Fernandez is entitled to participate in all benefits
generally made available to senior executives and to receive annual bonus
compensation as determined by the compensation committee in its discretion. In
addition, Mr. Fernandez is entitled to receive stock options to purchase up to
an additional 750,000 shares of class A common stock, if certain performance
targets are met and subject to certain other conditions as set forth in his
employment agreement. If we terminate Mr. Fernandez's employment without cause
or upon the occurrence of a "change of control" (as defined in Mr. Fernandez's
employment agreement), we will be obligated to make severance payments in an
amount equal to the greater of (i) the product of the annual base salary then in
effect multiplied by two, or (ii) the net present value of the annual base
salary then in effect multiplied by the number of years remaining in the term.
In addition, upon any such termination, Mr. Fernandez will automatically be
vested in all stock options granted to him pursuant to his employment agreement.
During the term of the agreement and following the termination of his employment
with us for any reason, Mr. Fernandez will not be permitted to engage in or have
an interest in any person or entity that engages in competition with us in any
"territory" (as such term is defined in the employment agreement) in which we or
any of our subsidiaries conduct business during or within one year following the
term of the agreement.
EMPLOYMENT AGREEMENT WITH MICHAEL KAKOYIANNIS
We were party to an employment agreement with Mr. Kakoyiannis that provided
for his employment as the company's President and Chief Executive Officer
through December 31, 2000. Mr. Kakoyiannis was to receive a base salary of
$360,000 a year pursuant to that employment agreement. Prior to the expiration
of the term of that agreement, we negotiated and entered into a separation and
release agreement with Mr. Kakoyiannis, effective as of November 1, 1999, which
terminated the existing employment agreement with Mr. Kakoyiannis.
EMPLOYMENT AGREEMENT WITH PAUL R. THOMSON
We are party to an employment agreement with Mr. Thomson that provides for
Mr. Thomson's employment as Vice President and Chief Financial Officer through
December 31, 2000. Mr. Thomson's employment agreement provides for an annual
base salary of $210,000 for 1999 and $225,000 for 2000. Mr. Thomson is entitled
to participate in all benefits generally made available to senior executives and
to receive annual bonus compensation as determined by the compensation committee
if certain performance targets have been met. Such bonus compensation will not
exceed $40,000 for 1999 and $50,000 for 2000. If we terminate Mr. Thomson's
employment without cause or upon the occurrence of a "change of control" (as
defined in Mr. Thomson's employment agreement), we will be obligated to make
severance payments in an amount equal to the aggregate amount of Mr. Thomson's
base monthly salary for the lesser of (i) three months or (ii) the remaining
term of his employment pursuant to the agreement. Following the termination of
his employment with us for any reason, Mr. Thomson shall not serve in any
accounting or financial capacity for, or otherwise be involved in the accounting
and financial functions of any radio station with a rock-based format within 50
miles of the transmitter of any of our radio stations for a period of six months
following the termination of Mr. Thomson's employment agreement.
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<PAGE>
EMPLOYMENT AGREEMENT WITH ALAN D. KIRSCHNER
We are party to an employment agreement with Mr. Kirschner that provides for
Mr. Kirschner's employment as Vice President--Engineering through December 31,
2000. Mr. Kirschner's employment agreement provides for an annual base salary of
$150,000 for 1999 and $175,000 for 2000. Mr. Kirschner is entitled to
participate in all benefits generally made available to senior executives and to
receive annual bonus compensation. Such bonus compensation shall not exceed
$25,000 for each of 1999 and 2000. If Mr. Kirschner's employment agreement is
terminated without cause, we will be obligated to make severance payments in an
amount equal to $500,000. If Mr. Kirschner's employment agreement is terminated
upon Mr. Kirschner's disability, we will be obligated to make severance payments
in an amount equal to twelve times his base monthly salary in effect on the date
of termination. Following the termination of his employment with us for any
reason, Mr. Kirschner shall not serve in any engineering or technical capacity
for, or otherwise be involved in the engineering and technical functions of any
radio station within 50 miles of the transmitter of any of our radio stations.
The non-compete period shall be for 30 days following the termination if
terminated by us with cause, for 60 days if terminated by Mr. Kirschner and for
one year if terminated by us without cause.
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<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Subotnick and Mr. Kakoyiannis entered into a Loan Agreement, dated as of
August 4, 1995, as amended, pursuant to which Mr. Subotnick made a loan to
Mr. Kakoyiannis as evidenced by a promissory note, dated August 4, 1995, in the
original principal amount of $500,000. This loan is secured by a first priority
security interest in favor of Mr. Subotnick in Mr. Kakoyiannis' shares of
class A common stock.
We receive certain legal, accounting, tax and other services from Metromedia
Company for which we pay to Metromedia Company an annual fee not to exceed
initially up to $200,000, increasing up to $500,000. Mr. Subotnick is a general
partner of Metromedia Company. We paid Metromedia Company a management fee of
$135,000 during 1999.
INDEMNIFICATION AGREEMENTS
We have not entered into any indemnification agreements.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires Big City Radio's directors and
executive officers, and persons who beneficially own more than 10% of the
outstanding class A common stock, to file with the Commission and the American
Stock Exchange ("AMEX") initial reports of ownership and reports of changes in
ownership of the class A common stock. Such officers, directors and greater than
10% stockholders are required by the regulations of the Commission to furnish
Big City Radio with copies of all reports that they file under Section 16(a). To
Big City Radio's knowledge, based solely on a review of the copies of such
reports furnished to Big City Radio and written representations that no other
reports were required, all Section 16(a) filing requirements applicable to Big
City Radio's officers, directors and greater than 10% beneficial owners were
complied with by such persons during the fiscal year ended December 31, 1999.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The current members of the compensation committee are Mr. Michael H. Boyer
and Mr. Leonard White. Mr. White is also a director of Metromedia International
Group, Inc. ("MMG") and of Metromedia Fiber Network, Inc. ("MFN"), two public
companies controlled by Metromedia Company.
COMPENSATION COMMITTEE REPORT ON COMPENSATION
The compensation committee of the board of directors is comprised entirely
of independent directors and is responsible for developing and making
recommendations to the board of directors with respect to our executive
compensation policies.
The following report of the compensation committee discusses our executive
compensation policies and the basis of the compensation paid to our executive
officers in 1999:
In general, the compensation committee seeks to link the compensation
paid to each executive officer to the performance of such executive officer.
Within these parameters, the executive compensation program attempts to
provide an overall level of executive compensation that is competitive with
companies of comparable size and with similar market and operating
characteristics.
There are three elements in Big City Radio's executive total
compensation program, all determined by individual and corporate performance
as specified in the various employment agreements:
Base salary
Annual incentive
Long-term incentive
14
<PAGE>
BASE SALARY
Amounts earned during 1999 by Big City Radio's executive officers are
shown in the Summary Compensation Table. The base compensation of such
executive officers is set by the terms of the employment agreement entered
into with such executive officer. Base Salaries were established by the
company and approved by the compensation committee for each of the executive
employment agreements.
ANNUAL INCENTIVES
Big City Radio's executive officers were awarded cash bonuses in 1999
based on 1999 performance against targets established by the company.
Individual awards were determined based on provisions of the respective
employment agreements where applicable. Each executive officer is entitled
to an annual incentive bonus as determined by the compensation committee.
LONG-TERM INCENTIVES
Long-term incentive awards are granted periodically and are intended to
align a significant portion of the executive compensation program with
shareholder interests. Big City Radio's executives are eligible to
participate in the 1999 Incentive Stock Plan. During 1999, Big City Radio
granted and the compensation committee approved long-term incentive awards
in the form of stock options to purchase 100,000 shares of its class A
common stock to each of Mr. Subotnick and Mr. Thomson and 50,000 shares of
our class A common stock to each of Mr. Wadler and Ms. Kessel at an exercise
price of $3.5625 per share which was the fair market price of the company's
class A common stock on the grant date, November 1, 1999 and 15,000 and
5,000 shares of our class A common stock to each of Mr. Thomson,
Mr. Subotnick and Mr. Kirschner at an exercise price of $3.4375 and $4.313
per share, respectively, which was the fair market of the class A common
stock on the grant date, January 28, 1999 and March 11, 1999, respectively.
In addition, Big City Radio granted and the compensation committee approved
stock options to purchase 100,000 shares of our class A common stock at an
exercise price of $3.4375 per share which was the fair market price of the
class A common stock on the grant date, October 20, 1999, to Mr. Kirschner.
Also, on November 1, 1999, the company granted and the compensation
committee approved stock options to purchase 200,000; 25,000 and 250,000
shares of the company's class A common stock to Mr. Subotnick,
Mrs. Subotnick and Mr. Fernandez, respectively, at an exercise price of
$3.5625, $3.5625 and $4.00 per share, respectively.
INCENTIVE STOCK PLANS
Big City Radio has adopted the 1997 Incentive Stock Plan, the 1998
Incentive Stock Plan and the 1999 Incentive Stock Plan pursuant to which Big
City Radio and its subsidiaries' key employees, officers and directors
(including independent directors and members of the compensation committee)
who have substantial responsibility in the company's and its subsidiaries'
direction, and others whom the compensation committee determines provide
substantial and important services to Big City Radio may be granted
(i) incentive stock options ("ISOs") and/or (ii) non-qualified stock options
("NQSOs" and together with ISOs, "Stock Options" and "Awards"). The company
has granted the maximum number of shares that may be the subject of Awards
under the 1997 Incentive Stock Plan and the 1998 Incentive Stock Plan. The
aggregate number of shares of the class A common stock that may be the
subject of Awards under the 1999 Incentive Stock Plan will be 2,500,000 upon
approval by the stockholders of the amendment to the Incentive Stock Plan
increasing the number of shares available for issuance under the plan. The
maximum number of shares of class A common stock available with respect to
Awards granted to any one grantee is 1,000,000.
The exercise price of all ISOs granted under the Incentive Stock Plan is
not less than the fair market value of the class A common stock on the date
of grant (or 110% of such fair market value with respect to ISOs granted to
persons who own stock possessing more than 10% of the voting rights of our
capital stock) and the exercise price of all NQSOs is determined by the
compensation committee. Stock Options vest and become exercisable over a
period of years and have a term not to exceed ten years, as determined by
the compensation committee.
If a grantee's employment with us or a subsidiary is terminated because
of the grantee's death, or the grantee's retirement on or after attaining
age sixty-five or such age specified in accordance with an
15
<PAGE>
employment agreement, if any, with the grantor prior to the date when the
Stock Option is by its terms exercisable, the Stock Option shall be
immediately exercisable (and the restrictions thereof, if any, shall lapse)
as of the date of the termination of the grantee's employment, subject to
the other terms of the Incentive Stock Plans. Upon a "change in control" of
the company (as defined in the Incentive Stock Plans) and at the sole
discretion of the board of directors, each holder of a Stock Option shall
have the right to exercise the Stock Option in full without regard to any
waiting period, installment period or other limitation or restriction
thereon. Upon a grantee's termination of employment from the company or a
subsidiary on account of disability, the grantee or the legal representative
of the grantee, shall have the right for a period of one year following the
date of such termination to exercise an Award to the extent such award is
exercisable and to the extent such Award has not yet expired. In the event
the grantee's employment with the company or a subsidiary is terminated for
any reason other than disability, death or retirement on or after attaining
age sixty-five, the grantee may exercise an Award to the extent then vested
within three months after his or her termination of employment.
CHIEF EXECUTIVE OFFICER COMPENSATION
Amounts earned during 1999 by Mr. Fernandez and Mr. Kakoyiannis, our
Chief Executive Officers during 1999, are shown in the Summary Compensation
Table. The base compensation of such Chief Executive Officers is set by the
terms of the employment agreement entered into with such Chief Executive
Officers. In addition, Big City Radio granted and the compensation committee
approved stock options to purchase 250,000 shares of its class A common
stock to Mr. Fernandez pursuant to his employment agreement with the company
at an exercise price of $4.00 per share. The fair market price of the
company's class A common stock on the grant date, November 1, 1999, was
$3.5625 per share. Mr. Fernandez is also entitled to an annual incentive
bonus as determined by the compensation committee Mr.Kakoyiannis was paid a
sum of money pursuant to the separation agreement entered into with the
company, a portion of which was deemed compensation. Mr. Kakoyiannis was not
granted any stock options during 1999.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162
One of the factors the compensation committee considers in connection
with compensation matters is the anticipated tax treatment to the company
and to the company's executives of the compensation arrangements. The
deductibility of certain types of compensation depends upon the timing of an
executive's vesting in, or exercise of, previously granted rights. Moreover,
interpretation of, and changes in, the tax laws and other factors beyond the
compensation committee's control also affect the deductibility of
compensation. Accordingly, the compensation committee will not necessarily
limit executive compensation to that deductible under Section 162(m) of the
Code. The compensation committee will consider various alternatives to
preserving the deductibility of compensation payments and benefits to the
extent consistent with its other compensation objectives.
The foregoing report of the compensation committee shall not be deemed to be
incorporated by reference into any filing of ours under the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, except to
the extent that we specifically incorporate such information by reference, and
shall not otherwise be deemed filed under such Acts.
Submitted by the Compensation
Committee
of Big City Radio's Board of Directors
as of April 12, 2000
Michael H. Boyer
Leonard White
16
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PERFORMANCE GRAPH
The following graph sets forth our total stockholder return as compared to
the Bloomberg R&R Index, an equity index designed to track performance in the
radio industry, and the AMEX Composite Index, a capitalization-weighted index
representing the aggregate value of the common shares or ADRs of all AMEX listed
companies, REITS, master limited partnerships, and closed-end investment
vehicles.
COMPARISON OF CUMULATIVE TOTAL RETURN SINCE DECEMBER 1999 AMONG
BIG CITY RADIO, INC. & SELECT INDICES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DOLLARS
<S> <C> <C> <C>
Big City Radio Inc. Bloomberg R&R Index AMEX Composite Index
19-Dec-97 100 100 100
31-Dec-97 116 105 104
31-Dec-98 58 131 106
31-Dec-99 68 251 136
</TABLE>
Assumes $100 investment on December 19, 1997 in Big City Radio, Inc., in the
Bloomberg R&R Index, and in the AMEX Composite Index, and reinvestment of
dividends paid.
<TABLE>
<CAPTION>
12/19/97 12/31/97 12/31/98 12/31/99
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Big City Radio, Inc........................ $100 $116 $ 58 $ 68
Bloomberg R & R Index...................... $100 $105 $131 $251
AMEX Composite Index....................... $100 $104 $106 $136
</TABLE>
17
<PAGE>
PROPOSAL 1--ELECTION OF DIRECTORS
The following table sets forth certain information with respect to the
current members of our board of directors, including Mr. Michael H. Boyer and
Mr. Leonard White, who have been nominated for re-election as class A directors
at the annual meeting.
The board of directors knows of no reason why any of its nominees will be
unable to or will refuse to accept election. If any nominee becomes unable to or
refuses to accept election, the board of directors will either reduce the number
of directors to be elected or select a substitute nominee. If a substitute
nominee is selected, proxies will be voted in favor of such nominee.
The affirmative vote of the holders of a plurality of shares of class A
common stock present in person or represented by proxy at the annual meeting and
voting as a single class will be required to elect each of Messrs. Boyer and
White as class A directors to Big City Radio's board of directors.
<TABLE>
<CAPTION>
NAME, PRINCIPAL OCCUPATION FOR PAST CLASS OF DIRECTOR
FIVE YEARS AND CERTAIN DIRECTORSHIPS AGE DIRECTORS SINCE
- ------------------------------------ -------- --------- --------
<S> <C> <C> <C>
Michael H. Boyer............................................ 50 Class A 1998
Mr. Boyer was elected a Director of the Company as of
January 1998. Mr. Boyer is currently Senior Vice
President and Chief Financial Officer of Stanadyne
Automotive Corp., a manufacturer of diesel fuel injection
equipment and hydraulic valve lifters, where he has been
employed since July 1978. Mr. Boyer is a member of the
Audit and Compensation Committees.
Leonard White............................................... 60 Class A 1997
Mr. White has served as a Director of the Company since
December 1997.
Mr. White is President and Chief Executive Officer of
Rigel Enterprises, a management and private investment
firm, since July 1997. Mr. White served as President and
Chief Executive Officer of Orion Pictures Corporation
("Orion"), a motion picture production and distribution
company, from 1992 until 1997 and as President and Chief
Executive Officer of Orion Home Entertainment Corporation
from 1987 to 1992. Mr. White is also a Director of
Metromedia International Group, Inc., an international
telecommunications and media company ("MMG"), and
Metromedia Fiber Network, Inc.
Mr. White is a member of the Audit and Compensation
Committees.
Charles M. Fernandez........................................ 38 Class B 1999
Mr. Fernandez has served as President and Chief Executive
Officer of the Company and a Director since November 1999.
Mr. Fernandez served as Chairman of Hispanic Internet
Holdings, Inc. from 1998 until its merger with Big City
Radio, Inc. Mr. Fernandez served as Executive Vice
President and Director of Heftel Broadcasting Corp. from
1989 to 1996. Mr. Fernandez has also served as Chairman of
the Board of Directors of Continucare Corp. since 1996, a
managed care company, and is a member of the Board of
Directors and Chairman of the Audit Committee of Ivax
Corp., a pharmaceutical company.
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
NAME, PRINCIPAL OCCUPATION FOR PAST CLASS OF DIRECTOR
FIVE YEARS AND CERTAIN DIRECTORSHIPS AGE DIRECTORS SINCE
- ------------------------------------ -------- --------- --------
<S> <C> <C> <C>
Silvia Kessel............................................... 49 Class B 1997
Ms. Kessel has served as a Director of the Company since
December 1997 and has served as Executive Vice President
of the Company since September 1997. Ms. Kessel has served
as Executive Vice President of MFN since October 1997,
Chief Financial Officer and Treasurer of MMG since 1995
and Executive Vice President of MMG since 1996. In
addition, Ms. Kessel served as Executive Vice President of
Orion from January 1993 through July 1997, Senior Vice
President of Metromedia Company since 1994 and President
of Kluge & Company since January 1994. Prior to that time,
Ms. Kessel served as Senior Vice President and a Director
of Orion from June 1991 to November 1992 and Managing
Director of Kluge & Company from April 1990 to January
1994. Ms. Kessel is a member of the board of directors of
MMG and MFN and is also a member of the board of directors
of Liquid Audio Inc.
Anita Subotnick............................................. 56 Class B 1994
Ms. Subotnick founded the Company in 1994 and has been
serving as a Director since our inception. Ms. Subotnick
has been a private investor for over five years. Ms.
Subotnick is married to Stuart Subotnick. Anita Subotnick
and Stuart Subotnick are the parents of Bryan Subotnick.
Stuart Subotnick............................................ 58 Class B 1994
Mr. Subotnick founded Big City Radio, Inc. in 1994 and has
served as Chairman of the board of directors since our
inception. Mr. Subotnick has spent approximately 30 years
at Metromedia Company (and its predecessor) and together
with long-time partner John W. Kluge, has overseen
Metromedia Company's investments in numerous media,
entertainment and communications businesses. Mr. Subotnick
has served since 1996 as Vice Chairman, President and
Chief Executive Officer of MMG. Mr. Subotnick has also
served as Executive Vice President of Metromedia Company
and its predecessor for over five years. Metromedia
Company and its predecessor owned and operated radio
stations, television stations, an outdoor advertising
business, and cellular telephone and paging operations
throughout the United States. Mr. Subotnick is also a
director of Carnival Cruise Lines, Inc., a cruise line
company, and MFN, a provider of high bandwidth, fiber
optic transmission capacity. Mr. Subotnick is married to
Anita Subotnick. Stuart and Anita Subotnick are the
parents of Bryan Subotnick.
Arnold L. Wadler............................................ 56 Class B 1997
Mr. Wadler has served as a Director and General Counsel of
the Company since December 1997 and has served as
Executive Vice President and Secretary of the Company
since September 1997. Mr. Wadler has served as Director of
MFN since July 1997, General Counsel of MFN since August
1997, Executive Vice President and Secretary of MFN since
October 1997, Executive Vice President, General Counsel
and Secretary of MMG since August 29, 1996 and, from
November 1, 1995 until that date, as Senior Vice
President, General Counsel and Secretary of MMG. In
addition, Mr. Wadler serves as a director of MMG and has
served as a Director of Orion from 1991 until July 1997
and has served as Senior Vice President, Secretary and
General Counsel of Metromedia Company for over five years.
</TABLE>
19
<PAGE>
PROPOSAL 2
AMENDMENT TO THE BIG CITY RADIO, INC.
1999 INCENTIVE STOCK OPTION PLAN
On November 1, 1999 our board of directors voted to, among other things,
amend our 1999 Incentive Stock Plan to increase the number of shares available
for the grant of options under the plan from 400,000 to 2,500,000 and to
increase the number of shares available for the grant of options under the plan
to any one optionee from 100,000 to 1,000,000, subject to adjustment in the
event of stock splits, stock dividends, recapitalizations and the like. Our
board of directors is submitting this amendment to our 1999 Incentive Stock Plan
to our stockholders for approval. If the stockholders approve this Proposal 2 to
amend the 1999 Incentive Stock plan, the number of shares available for the
grant of options under the plan will be 2,500,000 shares of class A common
stock.
If the stockholders do not approve Proposal 2, the total number of shares
that may be issued pursuant to options granted under the plan will remain at
400,000 and the total number of shares that may be issued pursuant to options
granted under the plan to any one optionee will remain at 100,000, subject to
adjustment in the event of stock splits, stock dividends, recapitalizations and
the like.
Options constitute a significant portion of the overall compensation of our
employees, including our executive officers. Options issued under our 1999
Incentive Stock Plan also represent a form of compensation that we pay to our
non-employee directors. The board of directors believes that we will derive
substantial benefits from increasing the number of options that we can issue
under our 1999 Incentive Stock Plan. The board of directors believes that the
proposed amendment, by allowing us to issue additional options under our 1999
Incentive Stock Plan, will enable us to further align the interests of our
current directors, executive officers and other employees with the interests of
the stockholders. Our board also believes that the proposed amendment will
assist us in attracting and retaining key executives by enabling us to offer
competitive compensation packages.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO AMEND
THE BIG CITY RADIO, INC. 1999 INCENTIVE STOCK PLAN TO INCREASE THE TOTAL NUMBER
OF SHARES THAT MAY BE ISSUED PURSUANT TO OPTIONS GRANTED UNDER THE PLAN FROM
400,000 TO 2,500,000 AND TO INCREASE THE TOTAL NUMBER OF SHARES THAT MAY BE
ISSUED PURSUANT TO OPTIONS GRANTED UNDER THE PLAN TO ANY OPTIONEE FROM 100,000
TO 1,000,000.
BACKGROUND
Our 1999 Incentive Stock Plan was adopted by the board of directors and
approved by the stockholders on May 20, 1999. From January 1, 1999 through
October 31, 1999, we granted options to purchase an aggregate of 177,500 shares
of class A common stock under its 1999 Incentive Stock Plan and at November 1,
1999 we had only 222,500 shares of common stock available for the grant of
options under its 1999 Incentive Stock Plan. After examining our overall
employee compensation, the board of directors concluded that it was in our best
interests to make additional shares of common stock available for the grant of
options under the plan. Accordingly, the board approved an amendment to our 1999
Incentive Stock Plan to increase the total number of shares of common stock that
may be issued pursuant to options granted under the plan to 2,500,000 and to
increase the aggregate number of shares of class A common stock that may be
issued to any one optionee under the plan to 1,000,000. Our board of directors
now seeks stockholder approval of this amendment.
TYPES OF AWARDS
The types of awards that may be granted pursuant to the 1999 Stock Option
Plan include (i) incentive stock options ("ISOs") and (ii) non-qualified stock
options ("NQSOs" and together with ISOs, "Stock Options" and "Awards"). ISOs are
intended to be treated as incentive stock options within the meaning of
20
<PAGE>
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). NQSOs
are, in general, options which do not have the special income tax advantages
associated with ISOs.
Stock Option grants consist of the maximum number of ISOs that may be
granted to a particular grantee under applicable law with the balance, if any,
of the Stock Options being NQSOs.
ADMINISTRATION OF THE PLAN
The 1999 Stock Option Plan is administered by the Compensation Committee of
the Board of Directors. The Compensation Committee is made up of Independent
Directors. Members of the Compensation Committee will be eligible to receive
certain Awards (other than ISO's) under the 1999 Stock Option Plan. For purposes
hereof, "Independent Directors" shall mean any member of the Board of Directors
who during his entire term as a Director was not employed by the company and its
subsidiaries, within the meaning of Section 424(f) of the Code, and who also
satisfies the criteria for "outside director" under Section 162(m) of the Code.
Subject to the terms and conditions of the 1999 Stock Option Plan and the
formula awards for Independent Directors, the Compensation Committee is
authorized to grant Awards, to determine which employees, officers, directors or
other individuals may be granted Awards, to determine the type and number of
Awards to be granted, to determine the term of such Awards, to determine the
exercise price of any Award, to determine the terms of any agreement pursuant to
which Awards are granted, to interpret and construe the 1999 Stock Option Plan,
and to determine any other matters delegated to it under the 1999 Stock Option
Plan or necessary for the proper administration of the 1999 Stock Option Plan.
SHARES OF CLASS A COMMON STOCK SUBJECT TO THE 1999 STOCK OPTION PLAN
Subject to certain adjustments set forth in the 1999 Stock Option Plan, the
aggregate number of shares of the class A common stock that will be the subject
of Awards under the 1999 Stock Option Plan will be 2,500,000. The maximum number
of shares of class A common stock available with respect to Awards granted to
any one grantee shall not exceed, in the aggregate, 1,000,000 shares. Shares of
class A common stock subject to Awards granted under the 1999 Stock Option Plan
may either be authorized but unissued shares of class A common stock not
reserved for any other purpose or shares of class A common stock held in or
acquired for the treasury of the company.
Shares of class A common stock subject to an Award which terminates
unexercised may again be subject to an Award under the 1999 Stock Option Plan.
In addition, shares of class A common stock surrendered to the company in
payment of the exercise price or applicable taxes upon exercise of an Award may
also be used thereafter for additional Awards.
ELIGIBILITY
Any key employee, officer and director, including a director who is not an
employee and a director who serves on the Compensation Committee, of the company
and its subsidiaries who has substantial responsibility in the direction of the
company and its subsidiaries and anyone else whom the Compensation Committee
determines provides substantial and important services to the company is
eligible to receive Awards.
Independent Directors who first serve on the Board of Directors, subsequent
to the date the 1999 Stock Option Plan was adopted, shall be entitled to receive
Awards under the 1999 Stock Option Plan with respect to 2,500 shares of class A
common stock, each having an exercise price equal to the fair market value of a
share of class A common stock on the date of grant. Independent Directors shall
be entitled to receive, annually on the date of each annual stockholders'
meeting, Awards with respect to 2,500 shares of class A common stock (subject to
an aggregate maximum of 25,000 shares of class A common stock), each having an
exercise price equal to the fair market value of a share on the date of grant.
Awards to
21
<PAGE>
Independent Directors under the 1997 Incentive Stock Plan, the 1998 Incentive
Stock Plan and the 1999 Stock Option Plan will, however, be aggregated.
Accordingly, Independent Directors shall not be entitled to receive annual and
aggregate Awards under the 1997 Incentive Stock Plan, the 1998 Incentive Stock
Plan and/or the 1999 Stock Option Plan with respect to more than 2,500 and
25,000 shares of class A common stock, respectively. These Stock Options will be
immediately exercisable on the date of grant.
TERMS AND CONDITIONS OF STOCK OPTIONS
The exercise price of all ISOs granted under the 1999 Stock Option Plan must
be at least the fair market value of the class A common stock on the date of
grant. The exercise price of all NQSOs granted under the 1999 Stock Option Plan
is determined by the Compensation Committee. The term of each Stock Option
granted under the 1999 Stock Option Plan is determined by the Compensation
Committee but will in no event be greater than ten years from the date of grant.
With respect to ISOs granted to a grantee who owns stock possessing more
than 10% of the voting rights of the company's outstanding capital stock on the
date of grant, the exercise price of the ISO must be equal to 110% of the fair
market value of the class A common stock subject to the ISO on the date of grant
and the ISO may not be exercisable more than five years after the date of grant.
Stock Options vest and become exercisable over a period of years as
determined by the Compensation Committee.
Upon the exercise of a Stock Option, the grantee must pay the exercise price
in cash. Notwithstanding the foregoing, at the discretion of the Compensation
Committee, the exercise price may be paid with shares of class A common stock
already owned by, and in possession of, the grantee or with a combination of
cash or shares of class A common stock.
The aggregate fair market value of the class A common stock (determined on
the date of grant) for which ISOs granted under the 1999 Stock Option Plan and
any other plan of the company or a subsidiary may be exercisable for the first
time by any grantee during any calendar year cannot exceed $100,000 or such
other amount as may be prescribed under the Code or applicable regulations and
rulings from time to time. To the extent that the aggregate fair market value
exceeds $100,000, such Stock Options will be treated as NQSOs.
ACCELERATION OF VESTING AND EXERCISABILITY
If a grantee's employment with us is terminated because of the grantee's
death, or the grantee's retirement on or after attaining age sixty-five or the
age specified in any employment agreement with the grantee prior to the date the
Stock Option is by its terms exercisable, the Stock Option shall be immediately
exercisable (and the restrictions thereof, if any, shall lapse) as of the date
of the termination of the grantee's employment, subject to the other terms of
the 1999 Stock Option Plan.
The Board of Directors shall have discretion to determine, at the time of
grant, whether, in the event of a change in control, as such term is defined in
the 1999 Stock Option Plan, a grantee with an outstanding Stock Option will have
the right at any time thereafter to exercise the Stock Option in full
notwithstanding any waiting period, installment period, or other limitation or
restriction in any agreement or in the 1999 Stock Option Plan. In the event that
the Board of Directors in its discretion, elects not to provide in the grant to
a grantee for accelerated vesting in the event of a change of control, the Board
of Directors may nevertheless, in its sole discretion, determine that upon a
change in control each grantee with an outstanding Stock Option shall have the
right at any time thereafter to exercise the Stock Option in full
notwithstanding any waiting period, installment period or other limitation, or
restriction in any agreement or in the 1999 Stock Option Plan. In general, under
the 1999 Stock Option Plan, a "change in control" of the company shall be deemed
to have occurred as of the first day any one or more of the following four
conditions have been satisfied: (i) any event whereby a Person (as defined
below) (other
22
<PAGE>
than (a) the company or an affiliate, as defined in the Securities Exchange Act
of 1934 (the "Exchange Act") of the company, or (b) any employee benefit plan or
trust sponsored or maintained by the company or an affiliate, as defined in the
Exchange Act) (x) acquires 50% or more of the company's outstanding voting
securities or (y) acquires (in one transaction or in a series of related
transactions) a subsidiary, business unit, segment or division of the company as
defined by the Compensation Committee (provided, however, that in such event a
change in control shall be deemed to occur only with respect to employees of
such subsidiary, business unit, segment or division and who cease to be
employees of the company or any "affiliate" of the company); (ii) a change in
the composition of the Board of Directors such that at any time a majority of
the Board of Directors shall not have been members of the Board of Directors for
twenty-four months; provided, however, that Directors who were appointed or
nominated for election by at least two-thirds of the Directors who were
Directors at the beginning of such twenty-four month period (or deemed to be
such Directors under this clause (ii)) shall be deemed to be Directors at the
beginning of such twenty-four month period for the purposes of this
clause (ii); (iii) the stockholders of the company approve any plan or proposal
for the liquidation or dissolution of the company; or (iv) any consolidation or
merger of the company, other than a merger or consolidation of the company in
which the voting securities of the company outstanding immediately prior thereto
continue to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least 50% of the combined
voting power of the voting securities of the company or such surviving entity
outstanding immediately after such merger or consolidation. "Person" shall have
the same meaning as ascribed to such term in Section 3(a)(9) of the Exchange Act
and used in Section 13(d) thereof.
ADJUSTMENT PROVISIONS
The total number and character of shares of class A common stock subject to
Awards and the number and character of shares of class A common stock subject to
outstanding Awards and/or the exercise price of such shares will be
appropriately adjusted by the Compensation Committee if the shares of class A
common stock are changed into or exchanged for a different number or kind of
shares of stock or other securities of the company or of another corporation
(whether by reason of merger, consolidation, recapitalization, reclassification,
split, reverse split, combination of shares, or otherwise). The Compensation
Committee may also make appropriate adjustments in the event of a merger,
consolidation or other transaction or event having a similar effect.
FEDERAL INCOME TAX CONSEQUENCES
INCENTIVE STOCK OPTIONS
Under the Code and Treasury regulations and administrative pronouncements
thereunder, a grantee will not realize taxable income by reason of either the
grant or the exercise of an ISO, and the company will not receive an income tax
deduction at either such time. However, any appreciation in share value
following the date of grant will be taken into consideration at the time of
exercise in determining liability for the alternative minimum tax. If a grantee
exercises an ISO and delivers shares of class A common stock as payment for part
or all of the exercise price of the class A common stock received upon exercise
of the ISO ("Payment Stock"), no gain or loss will be recognized with respect to
the Payment Stock delivered and no tax will be payable with respect to the
Payment Stock or the class A common stock received upon exercise of the ISO. The
holding period of such class A common stock received will include the holding
period of the Payment Stock. To the extent the number of shares received exceeds
the number of shares tendered, the grantee's basis in the additional shares of
class A common stock received upon exercise of the ISO is zero and these shares
have a holding period that commences on the date of exercise of the ISO.
However, if the Payment Stock was acquired pursuant to the exercise of an ISO
and the required holding period in order to obtain favorable tax treatment with
respect to such class A common stock is not met as of the date such class A
common stock is delivered, the grantee will be treated as having sold the
Payment Stock in a disqualifying disposition and will be subject to the rules
described below for disqualifying
23
<PAGE>
dispositions. The grantee's basis in the class A common stock that he or she
receives upon exercise of the ISO in exchange for the Payment Stock is the same
as his or her basis in the Payment Stock increased by any amount included in
gross income as ordinary income due to any disqualifying disposition and any
cash paid on the exercise. The holding period of such class A common stock
commences on the date of exercise of the ISO.
If a grantee exercises an ISO and does not dispose of the shares of class A
common stock within two years from the date of grant and one year from the date
of exercise, the entire gain, if any, realized upon disposition will be taxable
to the grantee as long term capital gain, and the company will not be entitled
to any deduction. If, however, a grantee disposes of shares of class A common
stock prior to the expiration of the holding periods described in the previous
sentence (a so-called "disqualifying disposition"), the grantee will generally
realize ordinary income in, and tax withholding may be required upon, an amount
equal to the difference between the exercise price and the fair market value of
such shares of class A common stock on the date of exercise. The company will be
entitled to a deduction equal to the amount recognized as ordinary income by the
grantee. Any additional appreciation will be treated as a capital gain (long
term or short term depending on how long the grantee held the shares of class A
common stock prior to disposition) and the company will not be entitled to any
further deductions for federal income tax purposes. If the amount realized by
the grantee is less than the fair market value of the shares of class A common
stock upon exercise, then the amount of ordinary income and the corresponding
company deduction is equal to the excess of the amount realized over the
exercise price.
NON-QUALIFIED STOCK OPTIONS
As to the NQSOs, there will be no federal income tax consequences to either
the grantee or the company on the grant of the option because the NQSO does not
have a "readily ascertainable fair market value" as required by Section 83 of
the Code. Additionally, if a grantee exercises a NQSO and delivers shares of
class A common stock as payment for part or all of the exercise price of the
class A common stock purchased, no gain or loss will be recognized with respect
to the class A common stock delivered. To the extent a grantee receives more
shares of class A common stock pursuant to the exercise of the option than
shares of class A common stock delivered, the fair market value of this excess,
less any cash paid by the grantee, will be taxed as ordinary income and will be
subject to applicable tax withholding.
On the exercise of an NQSO, the grantee (except as described below)
recognizes taxable ordinary income equal to the difference between the exercise
price of the NQSO and the fair market value of such shares of class A common
stock on the date of exercise. The company will be entitled to a tax deduction
in an amount equal to the grantee's taxable ordinary income if it provides the
grantee with a timely Form W-2 or Form 1099, as appropriate.
Upon disposition of the class A common stock by the grantee, he or she will
recognize long term or short term capital gain or loss, as the case may be,
equal to the difference between the amount realized on such disposition and his
or her basis for the class A common stock, which will include the amount
previously recognized by him or her as ordinary income. The holding period for
capital gains purposes will commence on the day the optionee acquires the shares
of class A common stock pursuant to the NQSO. None of the appreciation on NQSO
is subject to the alternative minimum tax.
SECTION 280G
Under Section 280G of the Code, amounts payable to officers and highly
compensated individuals that are contingent upon a change in the ownership or
effective control of a corporation or of a substantial portion of its assets may
be subject to a 20% excise tax and may not be deductible by the corporate payor
if they exceed a "basic amount" allocated to such payment (so-called "excess
parachute payments"). The acceleration of the right to exercise otherwise
non-vested NQSOs, when considered in connection with other payments to officers
and highly compensated individuals of the company, may give rise to excess
24
<PAGE>
parachute payments. In that event, the affected grantee will be subject to a 20%
excise tax, and the company will lose its deduction.
SECTION 162(M)
Under Section 162(m) of the Code, the income tax deduction of
publicly-traded companies may be limited to the extent total compensation
(including base salary, annual bonus, stock option exercises and non-qualified
benefits paid in 1994 and thereafter) for certain executive officers exceeds
$1,000,000 (less the amount of any "excess parachute payments" as defined in
Section 280G of the Code) in any one year. However, under Section 162(m) of the
Code, the deduction limit does not apply to certain "performance-based"
compensation established by an independent compensation committee which is
adequately disclosed to, and approved by, stockholders. In particular, Awards
will satisfy the performance-based exception if the Awards are made by a
qualifying compensation committee, the specified period and the compensation is
based solely on an increase in the stock price after the date of grant (i.e.,
the option exercise price is equal to or greater than the fair market value of
the stock subject to the Award on the grant date). The company intends to
consider fully the implications of Section 162(m) of the Code on the
deductibility of compensation in making awards under the 1999 Stock Option Plan.
The foregoing federal income tax information is a summary only and does not
purport to be a complete statement of the relevant provisions of the Code.
AMENDMENT AND TERMINATION OF THE 1999 STOCK OPTION PLAN
Unless terminated earlier by action of the board of directors, the 1999
Stock Option Plan will terminate on the tenth anniversary of its adoption and no
additional grants under the 1999 Stock Option Plan will be made after that date.
Except as provided below, the Board of Directors may amend or terminate the
1999 Stock Option Plan at any time. The 1999 Stock Option Plan may not however
be amended without the approval of the holders of a majority of the outstanding
voting stock of the company (i) to decrease the minimum exercise price for ISOs;
(ii) to extend the term of the 1999 Stock Option Plan beyond ten years,
(iii) to extend the maximum terms of the Awards granted beyond ten years,
(iv) to withdraw the administration of the 1999 Stock Option Plan from the
Compensation Committee, (v) to change the class of eligible employees, officers,
directors and other grantees, (vi) to increase the aggregate number of shares of
class A common stock which may be issued under the 1999 Stock Option Plan, and
(vii) to otherwise require stockholder approval to comply with Rule 16b-3 under
the Exchange Act or any other applicable law, regulation, or listing requirement
or to qualify for an exemption or characterization that is deemed desirable by
the Board of Directors. Furthermore, no amendment or termination of the 1999
Stock Option Plan shall, without the written consent of the grantee, alter the
terms of Awards already granted and such Stock Options shall remain in full
force and effect as if the 1999 Stock Option Plan had not been terminated.
MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS
The Compensation Committee may, within the limitations of the 1999 Stock
Option Plan, modify, extend or renew outstanding Awards granted under the 1999
Stock Option Plan, or accept the surrender of outstanding Awards and authorize
the granting of new Awards in substitution therefor. No modification may,
without the consent of the grantee, alter or impair any rights or obligations
under any Award theretofore granted to the grantee nor shall any modification
adversely affect the status of an ISO under Section 422 of the Code.
TRANSFERABILITY OF AWARDS AND OTHER PROVISIONS
The rights of a grantee with respect to the Awards granted pursuant to the
1999 Stock Option Plan are not transferable other than by will or the laws of
descent and distribution and are exercisable, during the
25
<PAGE>
lifetime of the grantee, only by the grantee or by the guardian or legal
representative of the grantee acting in a fiduciary capacity on behalf of the
grantee under state law or court supervision. An Award is not subject, in whole
or in part, to attachment, execution or levy of any kind.
RIGHTS UPON TERMINATION OF EMPLOYMENT
If the grantee dies while an employee or when no longer an employee but
while he or she still has the right to exercise an Award, the grantee's estate
shall have the right for a period of one year following the date of death to
exercise the Award to the extent such Award is exercisable and to the extent
such Award has not yet expired.
Upon a grantee's retirement from the company or a subsidiary on or after
attaining age sixty-five or the age specified in an employment agreement the
grantee shall have the right for a period of three months following the date of
retirement to exercise an Award to the extent such Award is exercisable and to
the extent such Award has not yet expired.
Upon a grantee's termination of employment from the company or a subsidiary
on account of disability, the grantee or the legal representative of the
grantee, shall have the right for a period of one year following the date of
such termination to exercise an Award to the extent such award is exercisable
and to the extent such Award has not yet expired.
In the event the grantee's employment with the company or a subsidiary is
terminated for any reason other than disability, death or retirement, the
grantee may exercise an Award within three months after his or her termination
of employment.
RIGHTS AS STOCKHOLDER
No grantee of any Stock Option has any rights as a stockholder with respect
to any shares of class A common stock subject to his or her Stock Option prior
to the date on which he or she is recorded as the holder of such shares of
class A common stock on the records of the company.
NO RIGHT TO CONTINUED EMPLOYMENT
The 1999 Stock Option Plan is not a contract of employment, and the terms of
employment of any grantee shall not be affected in any way by the 1999 Stock
Option Plan or related instruments except as specifically provided therein. The
establishment of the 1999 Stock Option Plan shall not be construed as conferring
any legal rights upon any grantee for a continuation of employment, nor shall it
interfere with the right of the company or any subsidiary to discharge any
grantee and to treat him or her without regard to the effect which such
treatment might have upon him or her as a grantee.
The 2,500,000 shares of class A common stock which would be available under
the 1999 Stock Option Plan represent approximately 28.7% of the shares of
class A common stock outstanding on the record date.
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OPTIONS GRANTED UNDER OUR 1999 INCENTIVE STOCK PLAN
The following table sets forth options that have been granted to the
following persons or groups under our 1999 Incentive Stock Plan as of March 31,
2000: (a) each of our Named Executive Officers, (b) the current executive
officers, as a group, (c) the current directors who are not executive officers,
as a group, and (d) the employees who are not executive officers, as a group.
Because the grant of options under our 1998 Incentive Stock Plan is
discretionary, we are unable to determine the dollar value and number of options
that it will grant as a result of the proposed amendment.
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING
OPTIONS
NAME AND POSITION GRANTED
- ----------------- ----------
<S> <C>
Charles M. Fernandez........................................ 250,000
Chairman of the Board of Directors and Chief Executive
Officer
Michael Kakoyiannis......................................... 0
Former Chairman of the Board of Directors and Chief
Executive Officer
Paul R. Thomson............................................. 105,000
Vice President and Chief Financial Officer
Bryan Subotnick............................................. 105,000
Executive Vice President--Corporate Development
Alan D. Kirschner........................................... 105,000
Vice President--Engineering
Current executive officers, as a group...................... 665,000
Current directors who are not executive officers, as a
group..................................................... 275,000
All employees who are not executive officers, as a group.... 167,500
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO AMEND
THE BIG CITY RADIO, INC. 1999 INCENTIVE STOCK PLAN TO INCREASE THE TOTAL NUMBER
OF SHARES THAT MAY BE ISSUED PURSUANT TO OPTIONS GRANTED UNDER THE PLAN FROM
400,000 TO 2,500,000 AND TO INCREASE THE TOTAL NUMBER OF SHARES THAT MAY BE
ISSUED PURSUANT TO OPTIONS GRANTED UNDER THE PLAN TO ANY OPTIONEE FROM 100,000
TO 1,000,000.
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PROPOSAL 3--RATIFICATION OF
THE APPOINTMENT OF INDEPENDENT AUDITORS
Our board of directors has appointed the firm of KPMG LLP, independent
auditors, to audit our and our subsidiaries' financial statements for the year
ending December 31, 2000, subject to ratification by the stockholders holding
class A common stock and class B common stock, voting as a single class. As
Mr. Stuart Subotnick and Mrs. Anita Subotnick, the holders of all outstanding
shares of class B common stock, have indicated that they intend to vote in favor
of the retention of KPMG LLP at the annual meeting, such ratification is
therefore assured.
A partner of KPMG LLP is expected to be present at the annual meeting and to
be provided with an opportunity to make a statement if such partner desires to
do so and to be available to respond to appropriate questions from stockholders.
If the stockholders do not ratify the appointment KPMG LLP as Big City
Radio's independent auditors for the forthcoming fiscal year, such appointment
will be reconsidered by the Audit Committee and the board of directors.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" RATIFICATION
OF THE APPOINTMENT OF KPMG LLP AS THE INDEPENDENT AUDITORS OF BIG CITY RADIO'S
FINANCIAL STATEMENTS FOR THE YEAR ENDING DECEMBER 31, 2000.
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ANNUAL REPORT; INCORPORATION BY REFERENCE
Our annual report for the fiscal year ended December 31, 1999 (which
contains our audited financial statements) is being mailed to stockholders
together with this proxy statement. To the extent this proxy statement has been
or will be specifically incorporated by reference into any filing by us under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, the sections of the proxy statement entitled "Compensation Committee
Report on Compensation" and "Performance Graph" shall not be deemed to be so
incorporated unless specifically otherwise provided in any such filing.
Upon the oral or written request of any stockholder of record on the record
date, a copy of our annual report on Form 10-K for the fiscal year ended
December 31, 1999 (excluding exhibits), as filed with the Securities and
Exchange Commission, will be supplied without charge. Requests should be
directed to Big City Radio, Inc., c/o Metromedia Company, One Meadowlands Plaza,
East Rutherford, New Jersey 07073-2137, Attention: Arnold L. Wadler, Secretary,
telephone number: (201) 531-8000.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Any stockholder who wishes to present a proposal at the 2001 annual meeting
of stockholders, and who wishes to have such proposal included in our proxy
statement for that meeting, must deliver a copy of such proposal to Big City
Radio, Inc., c/o Metromedia Company at One Meadowlands Plaza, East Rutherford,
New Jersey 07073, Attention: Corporate Secretary, no later than December 10,
2000; provided, however, that if the 2001 annual meeting of stockholders is held
on a date more than 30 days before or after the corresponding date of the 2000
annual meeting of stockholders, any stockholder who wishes to have a proposal
included in our proxy statement for that meeting must deliver a copy of the
proposal to us at a reasonable time before the proxy solicitation is made. We
reserve the right to decline to include in our proxy statement any stockholder's
proposal which does not comply with the rules of the Securities and Exchange
Commission for inclusion therein.
OTHER BUSINESS
The board of directors does not intend to bring any other business before
the meeting and it is not aware that anyone else intends to do so. If any other
business comes before the meeting, it is the intention of the persons named in
the form of proxy, attached as an appendix, to vote as proxies in accordance
with their best judgment.
PLEASE EXERCISE YOUR RIGHT TO VOTE BY PROMPTLY COMPLETING, SIGNING AND
RETURNING THE ENCLOSED PROXY FORM. You may later revoke the proxy and, if you
are able to attend the meeting, you may vote your shares in person.
By Order of the Board of Directors,
/s/ Arnold L. Wadler
Arnold L. Wadler
Executive Vice President,
General Counsel and Secretary
April 28, 2000
29
<PAGE>
ANNEX A
BIG CITY RADIO INC. 1999 INCENTIVE STOCK PLAN
1. PURPOSE. The purposes of the Big City Radio, Inc. Incentive Stock Plan
are, in general, to give the Company a significant advantage in retaining key
employees, officers and directors, and to provide an incentive to selected key
employees, officers and directors of the Company and its subsidiaries, within
the meaning of Code Section 424(f), who have substantial responsibility in the
direction of the Company and its subsidiaries, and others whom the Committee
determines provide substantial and important services to the Company, to acquire
a proprietary interest in the Company, to continue as employees, officers and
directors or in their other capacities, and to increase their efforts on behalf
of the Company.
2. DEFINITIONS. Unless the context clearly indicates to the contrary, the
following terms, when used in the Plan, shall have the meanings set forth in
this Section 2.
"Act" shall mean the Securities Act of 1933, as amended from time to time.
"Award" means any Option.
"Board" means the Board of Directors of the Company.
"Change in Control" means an event that shall be deemed to have occurred as
of the first day any one or more of the following have been satisfied:
(a) any event whereby a Person (other than (i) the Company or an
affiliate, as defined in the Exchange Act, or (ii) any employee benefit plan
or trust sponsored or maintained by the Company or an affiliate, as defined
in the Exchange Act) (x) acquires 50% or more of the Company's outstanding
voting securities, or (y) acquires (in one transaction or in a series of
related transactions) a subsidiary, business unit, segment or division of
the Company as defined by the Committee (provided, however, that in such
event a Change in Control shall be deemed to occur only with respect to
employees of such subsidiary, business unit, segment or division and who
cease to be employees of the Company or of any "affiliate" of the Company).
For purposes of this subsection an "affiliate" shall mean any member of the
same controlled group (as defined in Code Sections 414(b)-(o) inclusive)
with the Company. "Person" shall have the same meaning as ascribed to such
term in Section 3(a)(9) of the Exchange Act and used in Section 13(d)
thereof;
(b) a change in the composition of the Board such that at any time a
majority of the Board shall not have been members of the Board for
twenty-four (24) months; provided, however, that directors who were
appointed or nominated for election by at least two-thirds of the directors
who were directors at the beginning of such twenty-four (24) month period
(or deemed to be such directors under this subparagraph) shall be deemed to
be directors at the beginning of such twenty-four (24) month period for the
purposes of this subparagraph;
(c) the stockholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company; or
(d) any consolidation or merger of the Company, other than a merger or
consolidation of the Company in which the voting securities of the Company
outstanding immediately prior thereto continue to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 50% of the combined voting power of the voting
securities of the Company, or such surviving entity, outstanding immediately
after such merger or consolidation.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time.
"Committee" shall mean the Committee described in Section 11 of the Plan.
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"Common Stock" shall mean $.01 par value Class A common stock of the
Company.
"Company" shall mean Big City Radio, Inc. or any successor company thereto.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
from time to time.
"Fair Market Value" shall mean the closing price of publicly traded Common
Stock on the national securities exchange on which the Common Stock is listed
(if the Common Stock is so listed) or on the NASDAQ National Market System (if
the Common Stock is regularly quoted on the NASDAQ National Market System), or,
if not so listed or regularly quoted, the mean between the closing bid and asked
prices of publicly traded Common Stock in the over-the-counter market, or, if
such bid and asked prices shall not be available, as reported by any nationally
recognized quotation service selected by the Company, or as determined by the
Committee in a manner consistent with the provisions of the Code.
"Grantee" shall mean any key employee, officer or director of the Company or
a subsidiary of the Company, within the meaning of Code Section 424(f), as
determined by the Committee who has substantial responsibility in the direction
of the Company and its subsidiaries, and anyone else whom the Committee
determines provides substantial and important services to the Company who is
granted an Award under the Plan.
"Incentive Stock Option" or "ISO" shall mean any stock option as defined in
Code Section 422.
"Independent Director" shall mean any member of the Board who during his
entire term as a director was not employed by the Company and its subsidiaries
within the meaning of Code Section 424(f), and who also satisfies the criteria
for "outside director" under Code Section 162(m).
"Non-Qualified Stock Option" or "NQSO" shall mean an option other than an
Incentive Stock Option.
"Option" shall mean ISOs and NQSOs, collectively.
"Plan" shall mean the Big City Radio, Inc. 1999 Incentive Stock Plan.
"Reporting Person" shall mean any person subject to the reporting
requirements of Section 16(a) of the Exchange Act with respect to equity
securities of the Company.
"Rule 16b-3" means Rule 16b-3 of the Exchange Act, or any successor thereto,
that excepts transactions under employee benefit plans, as in effect from time
to time.
3. TYPES OF AWARDS. The Plan provides for Incentive Stock Options and
Non-Qualified Stock Options. Except as provided herein, a particular form of
Award may be granted either alone or in addition to other grants hereunder. The
provisions of the particular forms of grants need not be the same with respect
to each recipient.
ISOs may be awarded to employees of the Company and its subsidiaries, within
the meaning of Code Section 424(f), including employees who are officers and
directors, but shall not be issued to directors or others who are not employees.
NQSOs may be awarded to employees and directors, including directors who are
not employees of the Company and its subsidiaries, within the meaning of Code
Section 424(f), and including members of the Committee and anyone whom the
Committee administering the Plan pursuant to Section 11 determines provides
substantial and important services to the Company. Options will consist of the
maximum number of ISOs that may be issued to a Grantee under applicable law,
with the balance (if any) of the Options being NQSO's.
4. TERM OF PLAN.
(a) Effective Date. This Plan shall become effective as of the date of
adoption thereof by the Board; provided, however, that the Plan shall be
submitted for approval by the stockholders of the Company no
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earlier than twelve (12) months prior to, and no later than twelve (12) months
after, the date of adoption of the Plan by the Board.
(b) Termination Date. This Plan shall terminate on the earliest of:
(i) the tenth anniversary of the effective date as determined under this
Section 4;
(ii) the date when all shares of the Common Stock reserved for issuance
under the Plan, shall have been acquired through exercise of any Awards
granted under the Plan; or
(iii) such earlier date as the Board may determine.
Any Award outstanding under the Plan at the time of its termination shall
remain in effect in accordance with its terms and conditions and those of the
Plan.
5. THE STOCK.
Subject to adjustment as provided in Section 9, the aggregate number of
shares of Common Stock which may be issued under the Plan shall be 2,500,000
shares; provided, however, that the maximum number of shares of Common Stock
available with respect to the Awards granted by the Committee to any one Grantee
under the Plan, in the aggregate, shall not exceed 1,000,000. Such number of
shares of Common Stock may be set aside out of the authorized but unissued
shares of Common Stock not reserved for any other purpose or out of shares of
Common Stock held in or acquired for the treasury of the Company. The Company,
during the term of the Plan, will at all times reserve and keep available such
number of shares of Common Stock as shall be sufficient to satisfy the
requirements of the Plan. All or any shares of Common Stock subjected under this
Plan to an Award which, for any reason, terminates unexercised as to such
shares, may again be subjected to an Award under the Plan. In addition to the
foregoing, shares surrendered to the Company by, or on behalf of, a Grantee in
payment of the exercise price or applicable taxes upon exercise may also be used
thereafter for additional Awards.
6. STOCK OPTIONS.
(a) GRANTS. Options may be granted by the Committee at any time and from
time to time prior to the termination of the Plan. Each Option granted under the
Plan shall be evidenced by an agreement in a form approved by the Committee. The
terms and conditions of such Option agreement need not be identical with respect
to each Grantee, but each Option agreement will evidence on its face whether it
is an ISO, a NQSO, or both. For purposes of this Section, an Option shall be
deemed granted on the date the Committee selects an individual to be a Grantee,
determines the number of shares to be issued pursuant to such Option and
specifies the terms and conditions of the Option. Except as hereinafter
provided, Options granted pursuant to the Plan shall be subject to the following
terms and conditions set forth in this Section 6.
Independent Directors who serve on the Board on the date this Plan is
adopted shall be entitled to receive Awards under the Plan with respect to
shares of Common Stock, each having an exercise price equal to the Fair Market
Value of a share on the date of grant. Any other Independent Director who first
serves on the Board subsequent to the date the Plan was adopted shall be
entitled to receive Awards under the Plan, upon his initial election to the
Board, with respect to 2,500 shares of Common Stock, each having an exercise
price equal to the Fair Market Value of a share on the date of grant.
Independent Directors shall be entitled to receive annually on the date of each
annual stockholder's meeting, Awards with respect to 2,500 shares of Common
Stock (subject to an overall 25,000 shares of Common Stock limit), each having
an exercise price equal to the Fair Market Value of a share on the date of
grant. All Options awarded to Independent Directors shall be immediately
exercisable. Notwithstanding the above, if any of the Independent Directors are
eligible to receive Awards under the Big City Radio, Inc. 1997 Incentive Stock
Plan or the Big City Radio, Inc. 1998 Incentive Stock Plans (the "Prior Plans")
or any subsequent or future incentive stock plan maintained by the Company
(collectively, the "Prior and Future Plans"), then such Independent Directors
shall be eligible to receive Awards under this Plan only to the extent that:
(i) the
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aggregate number of shares of Common Stock which can be issued under the Prior
Plans has been attained; and (ii) the Awards under this Plan would not in the
aggregate with Awards under the Prior and Future Plans, either at the time of
the Award or at any time thereafter, exceed 2,500 shares of Common Stock per
annum or an overall total of 25,000 shares of Common Stock.
(b) PRICE AND EXERCISE. The purchase price of the shares of Common Stock
upon exercise of an ISO shall be no less than the Fair Market Value of the
shares of Common Stock at the time of grant of an ISO; provided, however, if an
ISO is granted to a person owning either directly (or through application of the
attribution rules under Code Section 318) shares of Common Stock of the Company
possessing more than 10% of the total combined voting power of all classes of
shares of Common Stock of the Company as defined in Code Section 422 ("10%
Stockholder"), the purchase price shall be equal to 110% of the Fair Market
Value of the shares of Common Stock. The purchase price of the shares of Common
Stock upon exercise of a NQSO may be any price set by the Committee.
The purchase price shall be paid in United States dollars in cash or by
certified or cashier's check payable to the order of the Company at the time of
purchase. At the discretion of the Committee the purchase price may be paid
with: (i) shares of Common Stock already owned by, and in the possession of, the
Grantee; or (ii) any combination of United States dollars or shares of Common
Stock of the Company. Any required withholding tax shall be paid by the Grantee
in full, in accordance with the provisions of Section 12. Shares of Common Stock
of the Company used to satisfy the purchase price of an Option shall be valued
at their Fair Market Value. The purchase price shall be subject to adjustment,
but only as provided in Section 9 hereof.
Any vested Option may be exercised in full at one time by giving written
notice to the Company, which notice shall be signed and dated by the Grantee and
shall state the number of shares of Common Stock with respect to which the
Option is being exercised. The notice of the exercise of any Option shall be
accompanied by payment in full of the purchase price. If required by the
Company, such notice of exercise of an Option shall be accompanied by the
Grantee's written representation in accordance with Section 21. Upon such
demand, delivery of such representation prior to the delivery of any Common
Stock issued upon exercise of an Option shall be a condition precedent to the
right of the Grantee or such other person to purchase any shares of Common
Stock.
(c) VESTING. Options shall vest in accordance with the schedule established
for each Grantee; provided, however, that all Options awarded to a Grantee shall
vest immediately upon said Grantee's death or retirement as defined herein. The
Committee may accelerate the vesting schedule of any Award other than in the
event of a Change in Control.
(d) ADDITIONAL RESTRICTIONS ON EXERCISE OF AN ISO. The aggregate Fair
Market Value of Common Stock (determined at the time an ISO is granted) for
which an ISO is exercisable for the first time by a Grantee during any calendar
year (under all plans of the Company and its subsidiaries or parent) shall not
exceed $100,000 or such other amount as may be prescribed under the Code or
applicable regulations and rulings from time to time. To the extent that the
aggregate Fair Market Value of Common Stock (determined at the time an ISO is
granted) with respect to Options designated as ISOs exercisable for the first
time by a Grantee during any calendar year (under all plans of the Company and
its subsidiaries or parent) exceeds $100,000, such Options shall be treated as
NQSOs. The foregoing shall be applied by taking Options into account in the
order in which they were granted.
(e) DURATION OF OPTIONS. Options may be granted for terms of up to but not
exceeding ten (10) years from the effective date the particular Option is
granted; provided, however, that an ISO granted to a 10% Stockholder may be
granted for a term not exceeding five (5) years from the effective date the
particular ISO is granted.
If the stockholders of the Company have not approved the adoption of the
Plan prior to the end of one (1) year from the date the Plan is approved by the
Board, any Option granted under the Plan prior to
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such date shall be null and void and the Company shall rescind the issuance of
any shares of Common Stock issued upon the exercise of such Options by a Grantee
prior to such date. In the event of such rescission, the Company shall refund
the price paid per share of Common Stock by the Grantee upon exercise of the
Options upon receipt of the certificate representing such shares.
(f) MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. Subject to the terms
and conditions and within the limitations of the Plan, the Committee may modify,
extend or renew outstanding Options granted under the Plan, or accept the
surrender of outstanding Options (up to the extent not theretofore exercised)
and authorize the granting of new Options in substitution therefor (up to the
extent not theretofore exercised). In addition to the limitations set forth in
Section 15, the Committee shall not, however, with respect to ISOs, modify any
outstanding Award so as to specify a lower Award price or accept the surrender
of outstanding Awards and authorize the granting of new Awards in substitution
therefor specifying a lower price. Notwithstanding the foregoing or anything
herein, no modification of an Award shall, without the consent of the Grantee,
alter or impair any rights or obligations under any Award theretofore granted
under the Plan nor shall any modification be made which shall adversely affect
the status of an ISO under Code Section 422; provided, however, that any such
provision shall remain in effect with respect to other Awards, and there shall
be no further effect on the Plan.
(g) OTHER TERMS AND CONDITIONS. Awards may contain such other provisions,
which shall not be inconsistent with any of the foregoing terms, as the
Committee shall deem appropriate.
7. TERMINATION OF EMPLOYMENT. Upon the termination of a Grantee's
employment with the Company, any Award then held by such Grantee or Grantee's
estate may only be exercised as follows:
(a) RETIREMENT. If the Grantee's employment is terminated because he or she
has attained age 65, or in accordance with the age specified in an employment
agreement with a Grantee, he or she may within three (3) months following such
termination, exercise the Award to the extent such Award is otherwise
exercisable. However, in the event of his or her death prior to the end of the
three (3) month period after the aforesaid termination of his or her employment,
his or her estate shall have the right to exercise the Award within one
(1) year (but in no event after the scheduled expiration of the term of the
Award) following the date of his or her death with respect to all or any part of
the stock subject thereto, to the extent such Award is exercisable.
(b) DEATH. If the Grantee's employment with the Company is terminated by
death, his or her estate shall have the right to exercise the Award within one
(1) year (but in no event after the scheduled expiration of the term of the
Award) following such termination with respect to all or any part of the stock
subject thereto, to the extent such Award is exercisable.
(c) DISABILITY. If the Grantee's employment with the Company is terminated
by disability, as defined in Code Section 22(e)(3), he or she or his or her
legal representative shall have the right for a period of one (1) year (but in
no event after the scheduled expiration of the term of the Award) following the
date of such termination of employment to exercise any Award with respect to all
or any part of the stock subject thereto, to the extent such Award is
exercisable.
(d) OTHER REASONS. If the Grantee's employment with the Company is
terminated for any reason other than those provided above under "Retirement",
"Death" or "Disability", the Grantee shall have the right for a period of three
(3) months (but in no event after the scheduled expiration of the term of the
Award) following the date of such termination of employment to exercise any
Award, with respect to all or any part of the stock subject thereto, to the
extent such Award is exercisable. However, in the event of his or her death
prior to the end of the three (3) month period after the aforesaid termination
of his or her employment, his or her estate shall have the right to exercise the
Award within one (1) year (but in no event after the scheduled expiration of the
term of the Award) following the date of his or her death with respect to all or
any part of the stock subject thereto, to the extent such Award is exercisable.
All other
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Awards may be exercised within such other period of time as determined by the
Committee in its sole discretion.
For purposes of this Section 7, "termination of employment" shall mean the
termination of a Grantee's employment with the Company or a subsidiary or a
parent within the meaning of Code Section 424. A Grantee employed by a
subsidiary shall also be deemed to have a termination of employment if the
subsidiary ceases to be a subsidiary of the Company, and the Grantee does not
immediately thereafter become an employee of the Company or of a subsidiary or
of a parent. A Grantee who is a member of the Board but who is not also an
employee of the Company shall be considered to have terminated his or her
employment at such time as he or she is no longer a member of the Board. Any
other Grantee who is not otherwise an employee of the Company shall be
considered to have terminated employment when substantial services, as
determined by the Committee, are no longer provided to the Company by the
Grantee.
Also for purposes of this Section 7, a Grantee's "estate" shall mean his or
her legal representatives upon his or her death or any person who acquires the
right to exercise an Award by reason of the Grantee's death. The Committee may
in its discretion require the transferee of a Grantee to supply it with written
notice of the Grantee's death or disability and to supply it with a copy of the
will (in the case of the Grantee's death) or such other evidence as the Board
(or, following its appointment, the Committee) deems necessary to establish the
validity of the transfer of an Option.
If a Grantee's employment with the Company is terminated after a Change in
Control, the provisions of Section 8 shall supersede the provisions of this
Section 7.
8. CHANGE IN CONTROL. The Board shall have discretion to determine, at the
time of grant, whether, in the event of a Change in Control, a Grantee with an
outstanding Option shall have the right at any time thereafter to exercise the
Option in full nonwithstanding any waiting period, installment period, or other
limitation or restriction in any agreement or in the Plan. In the event that the
Board in its discretion, elects not to provide in the grant to a Grantee for
accelerated vesting in the event of a Change in Control, the Board may
nevertheless, in its sole discretion, determine that upon a Change in Control
each Grantee with an outstanding Option shall have the right at any time
thereafter to exercise the Option in full notwithstanding any waiting period,
installment period or other limitation or restriction in any agreement or in the
Plan.
9. ADJUSTMENT OR CHANGES IN THE STOCK.
(a) The total number and character of shares of Common Stock subject to
Awards, the number and character of shares of Common Stock subject to
outstanding Awards and/or the exercise price of such shares will be
appropriately adjusted by the Committee if the shares of Common Stock are
changed into or exchanged for a different number or kind of shares of stock or
other securities of the Company or of another corporation (whether by reason of
merger, consolidation, recapitalization, reclassification, split, reverse split,
combination of shares, or otherwise. The Committee may also make appropriate
adjustments in the event of a merger, consolidation, or other transaction or
event having a similar effect.
(b) The Company shall not be required to issue any fractional shares of
Common Stock pursuant to the Plan. Fractional shares resulting from any
adjustment in Awards pursuant to this Section 9 may be settled in cash or
otherwise as the Board shall determine.
(c) Notice of any adjustment shall be given by the Company to each holder of
an Award which shall have been so adjusted and such adjustment (whether or not
such notice is given) shall be effective and binding for all purposes of the
Plan.
(d) If another corporation is merged into the Company or the Company
otherwise acquires another corporation, the Board may elect to assume under the
Plan any or all outstanding stock options or other awards granted by such
corporation under any stock option or other plan adopted by it prior to such
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acquisition. Such assumptions shall be on such terms and conditions as the
Committee may determine; provided, however, that the awards as so assumed do not
contain any terms, conditions or rights that are inconsistent with the terms of
this Plan. Unless otherwise determined by the Board, such awards shall not be
taken into account for purposes of the limitations contained in Section 5 of the
Plan.
10. TRANSFERABILITY OF AWARDS. An Award shall be transferable only by will
or the laws of descent and distribution and shall be exercisable during the
Grantee's lifetime only by the Grantee or by the guardian or legal
representative of the Grantee acting in a fiduciary capacity on behalf of the
Grantee under state law and court supervision. An Award is not subject, in whole
or in part, to attachment, execution or levy of any kind.
11. ADMINISTRATION.
(a) The Plan shall be administered by the Committee appointed by the Board
which shall be composed of not less than two (2) members of the Board, each of
whom shall be a "Non-Employee Director" within the meaning of Rule 16b-3 and an
"outside director" within the meaning of Proposed Treasury Regulation
Section 1.162-27(e)(3) or such other regulations as may be issued in proposed,
temporary or final form under Code Section 162(m).
(b) The Committee shall act by a majority of its members at the time in
office and eligible to vote on any particular matter, and such action may be
taken either by a vote at a meeting or in writing without a meeting.
(c) Subject to the provisions of the Plan, the Committee shall from time to
time and at its discretion take the following actions:
(i) grant Awards;
(ii) determine which employees, officers, directors and other
individuals performing substantial and important services may be granted
Awards under the Plan;
(iii) determine the type of awards to be granted;
(iv) determine the number of shares subject to each Award;
(v) determine the term of each Award granted under the Plan;
(vi) determine the date or dates on which the Award granted shall be
exercisable;
(vii) determine the exercise price of any Award granted;
(viii) determine the Fair Market Value of the Common Stock subject to
the Awards granted;
(ix) determine the terms of any agreement pursuant to which Awards are
granted;
(x) amend any such agreement with the consent of the Grantee;
(xi) extend the exercise period of any Award;
(xii) accelerate the vesting period of any Award except in the event of
a Change in Control;
(xiii) establish performance-based goals within the meaning of Code
Section 162(m);
(xiv) establish such procedures as it deems appropriate for a recipient
of an Award hereunder to designate a beneficiary to whom any benefits
payable in the event of his or her death are to be made; and
(xv) determine any other matters specifically delegated to it under the
Plan or necessary for the proper administration of the Plan.
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The Committee shall also have the final authority and discretion to
interpret and construe the terms of the Plan and of any Award granted and such
interpretation and construction by the Committee shall be final, binding and
conclusive upon all persons including, without limitation, the Company,
stockholders of the Company or any subsidiary, the Plan, and all persons
claiming an interest in the Plan. Notwithstanding anything contained in this
Section 11 to the contrary, no term of the Plan relating to ISOs shall be
interpreted, nor shall any discretion or authority of the Committee be
exercised, so as to disqualify the Plan under Code Section 422 or, without the
consent of the Grantee, to disqualify any ISO under Code Section 422 or in a
manner inconsistent with Rule 16b-3.
(d) No member of the Committee or director of the Board shall be liable for
any action, interpretation or construction made in good faith with respect to
the Plan or any Award granted hereunder.
12. TAX WITHHOLDING. It shall be a condition to the obligation of the
Company to deliver shares or securities of the Company upon exercise of an
Award, that the Grantee of such Award pay to the Company such amount as may be
requested by the Company for the purpose of satisfying any liability for such
withholding taxes. The Committee may, in its sole discretion, permit the Grantee
of an Award, in accordance with any applicable regulations of the authority
issuing such regulations, to pay a portion or all of the amount of such minimum
required or additional permitted withholding taxes in shares provided, however,
that notwithstanding the foregoing, no shares can be withheld in excess of the
minimum number of shares to satisfy the Grantee's tax liability. At the
Committee's sole discretion, the Grantee shall be permitted to authorize the
Company to withhold, or shall agree to surrender back to the Company, on or
about the date such withholding tax liability is determinable, shares previously
owned by such Grantee or a portion of the shares that were or otherwise would be
distributed to such Grantee pursuant to such Award having a Fair Market Value
equal to the amount of such required or permitted withholding taxes to be paid
in shares.
13. SECURITIES LAW REQUIREMENTS.
(a) No Award granted pursuant to this Plan shall be exercisable in whole or
in part, nor shall the Company be obligated to acquire or sell any shares of
Common Stock subject to any such Option, if such exercise, acquisition and sale
would, in the opinion of counsel for the Company, violate the Act (or other
federal or state statutes having similar requirements), as it may be in effect
at that time. In this regard, the Committee may demand the representations
described in Sections 6(b) and 21.
(b) Each Award shall be subject to the further requirement that, if at any
time the Committee shall determine in its discretion that the listing or
qualification of the shares of Common Stock subject to such Award under any
securities exchange requirements or under any applicable law, or the consent or
approval of any governmental regulatory body, is necessary as a condition of, or
in connection with, the granting of such Award or the issue of shares
thereunder, such Award may not be exercised in whole or in part, unless such
listing, qualification, consent or approval shall have been affected or obtained
free of any conditions not acceptable to the Board.
(c) No person who acquires shares of Common Stock under the Plan may, during
any period of time that such person is an affiliate of the Company within the
meaning of the rules and regulations of the Securities and Exchange Commission
under the Act, sell such shares of Common Stock, unless such offer and sale is
made (i) pursuant to an effective registration statement under the Act, which is
current and includes the shares to be sold, or (ii) pursuant to an appropriate
exemption from the registration requirement of the Act, such as that set forth
in Rule 144 promulgated under the Act.
(d) With respect to any Reporting Person, transactions under the Plan are
intended to comply with all applicable conditions of Rule 16b-3. To the extent
any provision of the Plan or any action by an authority under the Plan fails to
so comply, such provision or action shall, without further action by any person,
be deemed to be automatically amended to the extent necessary to effect
compliance with Rule 16b-3, provided that if such provision or action cannot be
amended to effect such compliance, such provision or
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action shall be deemed null and void, to the extent permitted by law and deemed
advisable by the appropriate authority. Each Award to a Reporting Person under
the Plan shall be deemed issued subject to the foregoing qualification.
14. FOREIGN PARTICIPANTS. In order to facilitate the making of an Award
and to foster and promote achievement of the purposes of the Plan, the Committee
may provide for such special terms for Awards to Grantees who are foreign
nationals, or who are employed by the Company outside of the United States of
America, as the Committee may consider necessary or appropriate to accommodate
differences in local law, tax policy or custom. Moreover, the Committee may
approve such supplements to, or amendments, restatements or alternative versions
of this Plan as in effect for any other purpose, and the Secretary or other
appropriate officer of the Company may certify any such document as having been
approved and adopted in the same manner as the Plan; provided, however, that no
such supplements, amendments, restatements or alternative versions shall include
any provisions that are inconsistent with the terms of the Plan, as then in
effect, unless the Plan could have been amended to eliminate the inconsistency
without further approval by the stockholders of the Company.
15. AMENDMENT OR TERMINATION OF THE PLAN. The Board may amend or terminate
the Plan at any time, except that approval of the holders of a majority of the
outstanding voting stock of the Company is required for amendments which:
(i) decrease the minimum exercise price for ISOs;
(ii) extend the term of the Plan beyond ten (10) years;
(iii) extend the maximum terms of the Awards granted hereunder beyond
ten (10) years;
(iv) withdraw the administration of the Plan from the Committee
appointed pursuant to Section 11;
(v) change the class of eligible employees, officers, directors and
other Grantees;
(vi) increase the aggregate number of shares of Common Stock which may
be issued pursuant to the provisions of the Plan;
(vii) otherwise require stockholder approval to comply with Rule 16b-3
or any other applicable law, regulation, or listing requirement or to
qualify for an exemption or characterization that is deemed desirable by the
Board.
Notwithstanding the foregoing, the Board may, without the need for
stockholders' approval, amend the Plan in any respect to qualify ISOs as
incentive stock options under Code Section 422.
No amendment or termination of the Plan shall, without the written consent
of the Grantee, alter the terms of Options already granted and such options
shall remain in full force and effect as if the Plan had not been terminated.
Any Award that may be made pursuant to an amendment to the Plan that shall
have been adopted without the approval of the stockholders of the Company shall
be null and void as to persons subject to Section 16(a) of the Act if it is
subsequently determined that such approval was required in order for the Plan to
continue to satisfy the applicable conditions of Rule 16b-3.
Furthermore, technical or clarifying amendments shall be made by the
Committee and not by the Board.
16. NO OBLIGATION TO EXERCISE OPTION. The granting of an Award shall
impose no obligation upon the Grantee (or upon a transferee of a Grantee) to
exercise such Award.
17. NO LIMITATION ON RIGHTS OF THE COMPANY. The grant of any Award shall
not in any way affect the right or power of the Company to make adjustments,
reclassification, or changes in its capital or business
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structure or to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.
18. PLAN NOT A CONTRACT OF EMPLOYMENT. The Plan is not a contract of
employment, and the terms of employment of any recipient of any Award hereunder
shall not be affected in any way by the Plan or related instruments except as
specifically provided therein. The establishment of the Plan shall not be
construed as conferring any legal rights upon any recipient of any Award
hereunder for a continuation of employment, nor shall it interfere with the
right of the Company or any subsidiary to discharge any recipient of any Award
hereunder and to treat him or her without regard to the effect which such
treatment might have upon him or her as the recipient of any Award hereunder.
19. EXPENSES OF THE PLAN. All of the expenses of the Plan shall be paid by
the Company.
20. FUNDING. The Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any Grantee or
other person. To the extent any person holds any rights by virtue of an Award
granted under the Plan, such rights shall be no greater than the rights of an
unsecured general creditor of the Company.
21. COMPLIANCE WITH APPLICABLE LAW. Notwithstanding anything herein to the
contrary, the Company shall not be obligated to cause to be issued or delivered
any certificates for shares of Common Stock pursuant to the exercise of an
Option, unless and until the Company is advised by its counsel that the issuance
and delivery of such certificates is in compliance with all applicable laws,
regulations of governmental authority and the requirements of any exchange upon
which shares of Common Stock are traded including, without limitation, any
legends that are required on such stock certificates. The Company shall in no
event be obligated to register any securities pursuant to the Act (as now in
effect or as hereafter amended) or to take any other action in order to cause
the issuance and delivery of such certificates to comply with any such law,
regulation or requirement.
The Committee may require, as a condition of the issuance and delivery of
such certificates and in order to ensure compliance with such laws, regulations
and requirements, that the recipient of any Award hereunder make such covenants,
agreements and representations as the Committee, in its sole discretion, deems
necessary or desirable, including, without limitation, a written representation
from a stockholder that the stock is being purchased for investment and not for
distribution, acknowledging that such shares have not been registered under the
Act, as amended, and agreeing that such shares may not be sold or transferred
unless there is an effective registration statement for them under the Act, or,
in the opinion of counsel to the Company, that such sale or transfer is not in
violation of the Act.
22. EFFECT UPON OTHER COMPENSATION. Nothing contained herein shall prevent
the Company or any subsidiary from adopting other or additional compensation
arrangements for its employees or directors. The effect under any other benefit
plan of the Company of an inclusion in income by virtue of an Award hereunder
shall be determined under such other plan.
23. GRANTEE TO HAVE NO RIGHTS AS A STOCKHOLDER. No Grantee of any Option
shall have any rights as a stockholder with respect to any shares subject to his
or her Option prior to the date on which he or she is recorded as the holder of
such shares on the records of the Company. No Grantee of any Option shall have
the rights of a stockholder until he or she has paid in full the Option price.
24. NOTICE. Notice to the Company shall be deemed given if in writing and
mailed to Arnold Wadler, Esq., Metromedia Company, One Meadowlands Plaza, East
Rutherford, New Jersey 07073, by first class, certified mail. Notice to the
Grantee or the Grantee's estate, if applicable, shall be given by registered
mail to such person's last known address.
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25. GOVERNING LAW. Except to the extent preempted by federal law, this
Plan and all Option agreements entered into pursuant thereto shall be construed
and enforced in accordance with, and governed by, the laws of the State of New
York determined without regard to its conflict of law rules.
26. SUCCESSORS AND ASSIGNS. The Plan shall be binding on and inure to the
benefit of the Company and the employees to whom an Award is granted hereunder,
and such employees' heirs, executors, administrators, legatees, trustees,
personal representatives, assignees and transferees (where permitted).
27. DELIVERY OF THE PLAN. A copy of this Plan shall be delivered to the
Secretary of the Company and shall be shown by him to each eligible person
making reasonable inquiry concerning it. A copy of this Plan shall also be
delivered to each Grantee at the time his or her Award is granted.
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<PAGE>
PROXY PROXY
BIG CITY RADIO, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF SHAREHOLDERS TO BE HELD ON MAY 18, 2000, 3:00 P.M.
The undersigned hereby appoints Charles Fernandez, Paul Thomson and
Jonathan P. Gilmore, and each of them, as proxies, each with the power to
appoint his substitute, and hereby authorizes them to represent and to vote
at the annual meeting of stockholders of Big City Radio, Inc., to be held on
May 18, 2000, at 3:00 p.m. local time, on the Concourse Level, 1285 Avenue of
the Americas, New York, New York 10022, and any and all adjournments thereof,
as designated below, all of the shares of common stock, par value $.01 per
share, of Big City Radio, Inc. according to the number of votes which the
undersigned would possess if personally present, for the purposes of
considering and taking action upon the proposals set forth on the reverse
side, as more fully set forth in the Proxy Statement.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
PLEASE MARK, DATE, SIGN AND RETURN THIS PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE
(CONTINUED ON REVERSE SIDE)
FOLD AND DETACH HERE
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1. Election of Director-Nominees 2. Proposal to amend the Big City 3. The ratification of the appointment
Leonard White, Michael H. Boyer. Radio, Inc. 1999 Incentive Stock of KPMG LLP as independent auditors
Plan. for the year ended December 31, 2000.
For Withhold
all nominees Authority FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
(except as to vote for
noted below) all nominees / / / / / / / / / / / /
/ / / /
IMPORTANT: PLEASE SIGN EXACTLY AS NAME APPEARS
- ------------------------------------- ON THIS CARD. EACH JOINT OWNER SHOULD SIGN.
Nominee Exception EXECUTORS, ADMINISTRATOR, TRUSTEES, ETC. SHOULD
GIVE FULL TITLE.
(Instruction. To withhold authority
to vote for any individual nominee,
strike a line through the nominee's Date: 2000
name in the above list.) -------------------------------------------
------------------------------------------------
Signature
------------------------------------------------
Please Print Name Here
------------------------------------------------
Signature
------------------------------------------------
Please Print Name Here
</TABLE>
THIS PROXY WHEN PROPERLY EXECUTED WILL VOTE IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER, THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT THE STOCKHOLDERS VOTE "FOR" PROPOSALS 1, 2 AND 3. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES FOR DIRECTOR,
FOR PROPOSAL 2 AND FOR PROPOSAL 3, IN THEIR DISCRETION, THE PROXIES ARE
AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
ANNUAL MEETING OR ANY ADJOURNMENT THEREOF.
FOLD AND DETACH HERE
