<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED.
<TABLE>
<S> <C>
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule
14a-12
ABOUT.COM, INC.
-----------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
</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:
----------------------------------------------------------
(2) Aggregate number of securities to which transactions
applies:
----------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
----------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------
/ / Fee paid previously with preliminary materials:
/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11 (a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or
schedule and the date of its filing.
(1) Amount Previously Paid:
----------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------
(3) Filing Party:
----------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------
</TABLE>
<PAGE>
ABOUT.COM, INC.
220 East 42nd Street, 24th Floor
New York, NY 10017
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 9, 2000
The Annual Meeting of Stockholders (the "Annual Meeting") of
About.com, Inc., a Delaware corporation (the "Company"), will be held at the
Hotel Intercontinental of New York, 111 East 48th Street, New York, New York,
10017 on May 9, 2000 at 9:00 a.m. (New York time) for the following purposes, as
more fully described in the Proxy Statement accompanying this notice:
(1) To elect Directors to serve until the 2001 Annual Meeting of
Stockholders or until their respective successors shall have been duly
elected and qualified;
(2) To ratify the selection of KPMG LLP as independent auditors of the
Company for the fiscal year ending December 31, 2000;
(3) To approve an amendment to the Company's Second Amended and Restated
Certificate of Incorporation to increase the number of authorized shares
of Common Stock from 50,000,000 to 100,000,000;
(4) To approve an amendment to the Company's Amended and Restated 1998 Stock
Option/Stock Issuance Plan (the "Plan") to increase the number of shares
of Common Stock authorized for issuance over the term of the Plan by an
additional 4,000,000 shares; and
(5) To transact such other business as may properly come before the Annual
Meeting or any adjournment or adjournments thereof.
Only stockholders of record at the close of business on March 24, 2000 will
be entitled to notice of, and to vote at, the Annual Meeting. The stock transfer
books of the Company will remain open between the record date and the date of
the meeting. A list of stockholders eligible to vote at the meeting will be
available for inspection at the meeting and for a period of ten days prior to
the meeting during regular business hours at the corporate headquarters at the
address above.
All stockholders are cordially invited to attend the meeting in person.
Whether or not you expect to attend the Annual Meeting, your proxy vote is
important. To assure your representation at the meeting, please sign and date
the enclosed proxy card and return it promptly in the enclosed envelope, which
requires no additional postage if mailed in the United States or Canada. Should
you receive more than one proxy because your shares are registered in different
names and addresses, each proxy should be signed and returned to assure that all
your shares will be voted. You may revoke your proxy at any time prior to the
Annual Meeting. If you attend the meeting and vote by ballot, your proxy will be
revoked automatically and only your vote at the Annual Meeting will be counted.
By Order of the Board of Directors
SCOTT P. KURNIT
CHIEF EXECUTIVE OFFICER AND
CHAIRMAN OF THE BOARD OF DIRECTORS
New York, New York
April 10, 2000
IT IS IMPORTANT THAT THE ENCLOSED PROXY CARD
BE COMPLETED AND RETURNED PROMPTLY
<PAGE>
ABOUT.COM, INC.
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 9, 2000
This Proxy Statement is furnished to stockholders of record of
About.com, Inc., a Delaware corporation (the "Company"), as of March 24, 2000,
in connection with the solicitation of proxies by the Board of Directors of the
Company (the "Board of Directors" or "Board") for use at the Annual Meeting of
Stockholders to be held on May 9, 2000 at 9:00 a.m. (New York time) (the "Annual
Meeting").
Shares cannot be voted at the Annual Meeting unless the owner is present in
person or by proxy. All properly executed and unrevoked proxies in the
accompanying form that are received in time for the meeting will be voted at the
Annual Meeting or any adjournment thereof in accordance with instructions
thereon, or if no instructions are given, will be voted, (i) "FOR" the election
of the named nominees as Directors of the Company, (ii) "FOR" the ratification
of KPMG LLP, independent public accountants, as auditors of the Company for the
fiscal year ending December 31, 2000, (iii) "FOR" the approval of the amendment
to the Company's Second Amended and Restated Certificate of Incorporation and
(iv) "FOR" the amendment to the Company's Amended and Restated 1998 Stock
Option/Stock Issuance Plan (the "Plan"), including the increase in the number of
shares authorized for issuance, and will be voted in accordance with the best
judgment of the persons appointed as proxies with respect to other matters which
properly come before the Annual Meeting. Any person giving a proxy may revoke it
by written notice to the Company at any time prior to exercise of the proxy. In
addition, although mere attendance at the Annual Meeting will not revoke the
proxy, a stockholder who attends the Annual Meeting may withdraw his or her
proxy and vote in person. Abstentions and broker non-votes will be counted for
purposes of determining the presence or absence of a quorum for the transaction
of business at the Annual Meeting. Abstentions will be counted in tabulations of
the votes cast on each of the proposals presented at the Annual Meeting, whereas
broker non-votes will not be counted for purposes of determining whether a
proposal has been approved.
The Annual Report of the Company (which does not form a part of the proxy
solicitation materials), containing the consolidated financial statements of the
Company for the fiscal year ended December 31, 1999, is being distributed
concurrently herewith to stockholders.
The mailing address of the principal executive offices of the Company is 220
East 42nd Street, 24th Floor, New York, New York 10017. This Proxy Statement and
the accompanying form of proxy are being mailed on or about April 10, 2000 to
the stockholders of the Company entitled to vote at the Annual Meeting.
VOTING SECURITIES
The Company has one class of voting securities outstanding, its common
stock, $0.001 par value (the "Common Stock"). Each holder of Common Stock is
entitled to one vote for each share held. In addition, the Company is authorized
to issue up to an aggregate of 5,000,000 shares of preferred stock, $0.001 par
value (the "Preferred Stock"), with such voting rights as may be determined by
the Board of Directors providing for such series. The Company does not have
current plans to issue any shares of Preferred Stock. At the Annual Meeting,
each stockholder of record at the close of business on March 24, 2000 will be
entitled to one vote for each share of Common Stock owned on that date as to
each matter presented at the Annual Meeting. On March 24, 2000, there were
17,138,723 shares of Common Stock outstanding, held by 152 stockholders of
record. A list of stockholders eligible to vote at the Annual Meeting will be
available for inspection at the Annual Meeting and for a period of ten days
prior to the Annual Meeting during regular business hours at the principal
executive offices of the Company at the address specified above.
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
Unless otherwise directed, the persons appointed in the accompanying form of
proxy intend to vote at the Annual Meeting "FOR" the election of the nominees
named below as Directors of the Company to serve until the 2001 Annual Meeting
of Stockholders or until their successors are duly elected and qualified. If any
nominee is unable to be a candidate when the election takes place, the shares
represented by valid proxies will be voted in favor of the remaining nominees.
The Board of Directors does not currently anticipate that any nominee will be
unable to be a candidate for election. The affirmative vote of a plurality of
the shares of Common Stock present in person or represented by proxy and
entitled to vote on the election of Directors at the Annual Meeting is required
to elect the Directors.
The Board of Directors currently has six members. Messrs. Scott P. Kurnit,
Frank J. Biondi, Jr., Dixon R. Doll, Ronald Unterman, Marc M. Watson and
Kristopher A. Wood are Directors whose terms expire at the Annual Meeting. The
nominees for election are Messrs. Kurnit, Biondi, Unterman and Wood, each of
whom are currently Directors, Mr. Stanley Fung and Ms. Daphne Kis (in all cases
subject to the election and qualification of their successors or to their
earlier death, resignation or removal). After their election, the Board of
Directors will have six members.
INFORMATION REGARDING THE NOMINEES FOR ELECTION AS DIRECTORS
The following information with respect to the principal occupation or
employment, other affiliations and business experience during the last five
years of the nominees have been furnished to the Company by such nominees.
Except as indicated, the nominees have had the same principal occupation for the
last five years.
SCOTT P. KURNIT, age 46, has served as our Chairman of the Board of
Directors and Chief Executive Officer since he founded About.com in June 1996
and also served as our President until January 2000. From March 1995 to
February 1996, Mr. Kurnit served as President and Chief Executive Officer of
MCI/ News Corporation Internet Ventures with responsibility for the Internet
initiatives of the parent companies. From June 1993 to March 1995, Mr. Kurnit
served as Executive Vice President of Prodigy Service Co., an online services
company. From March 1985 to June 1993, Mr. Kurnit was the President for both
Viewer's Choice and Showtime Event Television for Viacom Inc. From June 1979 to
March 1985, Mr. Kurnit was employed by Warner Communication in various
capacities, including Director of Programming for Qube and Vice President of
Programming and Advertising Sales for all of the company's cable systems.
Mr. Kurnit received his B.A. in Sociology and Communications from Hampshire
College.
FRANK J. BIONDI, JR., age 55, has served as a director of About.com since
December 1998. Since February 1999, Mr. Biondi has served as Senior Managing
Director of Waterview Advisors, an investment advisor organization. From
April 1996 to November 1998, Mr. Biondi served as Chairman and Chief Executive
Officer of Universal Studios, Inc., an international entertainment company. From
July 1987 to January 1996, Mr. Biondi served as President and Chief Executive
Officer of Viacom Inc., an international entertainment company. Mr. Biondi
currently serves on the boards of directors of Bank of New York Company, Inc., a
bank holding company, Vail Resorts, Inc., a mountain resort company and a number
of private companies. Mr. Biondi received his B.A. in Psychology from Princeton
University and an M.B.A. from Harvard University.
STANLEY FUNG, age 43, has served as Managing Director of Zero Stage Capital,
a venture capital firm, since December 1998 and as its General Partner from
October 1994 to December 1998. Mr. Fung currently serves on the boards of
directors of Silknet Software Inc., RoweCom Inc., and several privately-held
companies. Mr. Fung received his B.S. in Computer Systems Engineering from the
University of Massachusetts, his M.S. in Computer Science from the University of
California-Los Angeles and his S.M. in Management from the Massachusetts
Institute of Technology.
2
<PAGE>
DAPHNE KIS, age 45, has served as President and Chief Executive Officer of
EDventure Holdings, an information services and publishing firm, since December
1996. From October 1988 to December 1996, Ms. Kis served as its Vice President
and Publisher. Ms. Kis received her B.A. in Women's History from Hampshire
College and her M.B.A. from New York University.
RONALD UNTERMAN, age 54, has served as a director of About.com since
January 1997. Since December 1997, Mr. Unterman has served as Senior Vice
President, Technology Development of Envirogen, Inc., an environmental
biotechnology company. From August 1988 to December 1997, Mr. Unterman served as
Vice President of Envirogen, Inc. Mr. Unterman received his B.A. in Biology from
Haverford College and Ph.D. from Columbia University in Biochemistry.
KRISTOPHER A. WOOD, age 28, has served as a director of About.com since
November 1998. Since September 1997, Mr. Wood has served as Managing Director of
XL Ventures, Inc., the parent company of XL Ventures LLC, which is the venture
capital investment subsidiary of Big Flower Holdings, Inc., an advertising,
marketing and information services company. Since December 1999, Mr. Wood has
also served as Managing Director of XL Ventures LLC. Since September 1995,
Mr. Wood has also served as Director--Mergers and Acquisitions for Big Flower
Holdings, Inc. (and its predecessor, Big Flower Press Holdings, Inc.). From July
1993 to May 1995, Mr. Wood was a member of the Global Finance Group at BT Alex.
Brown Incorporated, an investment banking firm. Mr. Wood serves on the board of
directors of Promotions.com Inc. and numberous private companies. Mr. Wood
received his B.S. in Economics from The Wharton School of the University of
Pennsylvania.
THE BOARD OF DIRECTORS RECOMMENDS THE ELECTION OF SCOTT P. KURNIT, FRANK J.
BIONDI, JR., STANLEY FUNG, DAPHNE KIS, RONALD UNTERMAN AND KRISTOPHER A. WOOD AS
DIRECTORS UNTIL THE 2001 ANNUAL MEETING OF STOCKHOLDERS.
COMMITTEES OF THE BOARD
The Audit Committee of the Board of Directors was established in May 1998
and reviews, acts on and reports to the Board of Directors with respect to
various auditing and accounting matters, including the selection of the
Company's independent accountants, the scope of the annual audit, fees to be
paid to the independent accountants, the performance of the Company's
independent accountants and the accounting practices of the Company. The Audit
Committee currently consists of Messrs. Unterman, Watson and Wood.
The Compensation Committee of the Board of Directors was established in
May 1998 to administer the Company's stock option plans and to administer
certain of the Company's other benefit plans. The Compensation Committee also
provides recommendations to the Chief Executive Officer and the Board of
Directors concerning the salaries and incentive compensation of the executive
officers of the Company and the Company's other employees and consultants. The
Compensation Committee currently consists of Messrs. Doll, Unterman and Watson.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In 1999, the Compensation Committee consisted of Messrs. Doll, Kurnit,
Unterman and Watson. The Compensation Committee currently consists of
Messrs. Doll, Unterman and Watson. None of the members of the Compensation
Committee is or has been an officer or employee of the Company. Mr. Kurnit has
participated in all discussions and decisions concerning the compensation of our
executive officers, except that he was excluded from discussions by the Board of
Directors regarding his own compensation.
Mr. Doll is affiliated with Doll Technology Investment Fund, Doll Technology
Affiliates Fund, L.P. and Doll Technology Side Fund, L.P. Mr. Marc Watson is
affiliated with C-Max Capital Limited Partnership-I.
3
<PAGE>
These funds, together with Mr. Kurnit, have in the past provided financing to
the Company in consideration for the issuance of the Company's securities.
The Company entered into an agreement with Mr. Kevin Watson, who is also
affiliated with C-Max Capital Limited Partnership-I, pursuant to which
Mr. Kevin Watson provided consulting and advisory services to the Company. These
services include introducing the Company to members of the investment community
and assisting the Company with financial and strategic matters. In consideration
for his services under this agreement, Mr. Kevin Watson was granted a warrant to
purchase up to a total of 21,360 shares of Common Stock at an exercise price of
$5.06 per share. This warrant is exercisable at any time until March 23, 2006.
ATTENDANCE AT BOARD AND COMMITTEE MEETINGS
During 1999, the Board of Directors held six meetings and acted four times
by unanimous written consent. During this period, all of the directors attended
or participated in more than 75% of the aggregate of (i) the total number of
meetings of the Board of Directors and (ii) the total number of meetings held by
all Committees of the Board on which each such director served. The Compensation
Committee held two meetings during 1999, and acted three times by unanimous
written consent. The Audit Committee held one meeting during 1999.
DIRECTOR COMPENSATION
Other than reimbursing Directors for customary and reasonable expenses of
attending Board of Directors or Committee meetings, the Company does not
currently compensate its directors.
Under the Plan, each individual who first becomes a non-employee member of
the Board of Directors will be granted an option to purchase 20,000 shares of
Common Stock on the date the individual joins the Board of Directors, at an
exercise price equal to the fair market value on the grant date, provided the
individual has not previously been employed by the Company or any parent or
subsidiary corporation. In addition, on the date of each annual stockholders'
meeting after the initial public offering, including this Annual Meeting, each
non-employee member of the Board of Directors who is to continue to serve on the
Board of Directors will automatically be granted an option to purchase 5,000
shares of Common Stock, at an exercise price equal to the fair market value on
the grant date, provided the individual has served as a non-employee member of
the Board of Directors for at least six months. Each of the non-employee
directors will, if re-elected to the Board of Directors, receive an options
grant of 5,000 shares at an exercise price equal to the fair market value on the
date of this Annual Meeting. Each of Mr. Fung and Ms. Kis will receive an option
to purchase 20,000 shares at an exercise price equal to the fair market value on
the date of this Annual Meeting.
4
<PAGE>
PROPOSAL 2
RATIFICATION OF SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of Directors
appointed KPMG LLP, independent public accountants, as independent accountants
of the Company to serve for the year ending December 31, 2000, subject to the
ratification of such appointment by the stockholders at the Annual Meeting. A
majority of the votes of the outstanding shares of Common Stock is required to
ratify the appointment of the auditors. A representative of KPMG LLP will attend
the Annual Meeting with the opportunity to make a statement if he or she so
desires and will also be available to answer inquiries.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF KPMG LLP AS OUR INDEPENDENT PUBLIC ACCOUNTANTS FOR THE FISCAL
YEAR ENDING DECEMBER 31, 2000.
5
<PAGE>
PROPOSAL 3
AMENDMENT TO THE SECOND AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION
The Board of Directors has unanimously adopted, subject to stockholder
approval, an amendment to Article IV of the Company's Second Amended and
Restated Certificate of Incorporation to increase the number of authorized
shares of Common Stock from 50,000,000 shares to 100,000,000 shares. The text of
the second and third sentences of Article IV, Section A, as it is proposed to be
amended, is as follows:
The total number of shares which the Corporation is authorized to
issue is 105,000,000 shares. 100,000,000 shares, par value $0.001
per share, shall be Common Stock and 5,000,000 shares, par value
$0.001 per share, shall be Preferred Stock.
PURPOSE AND EFFECT OF THE AMENDMENT
The proposed amendment will authorize sufficient additional shares of Common
Stock to provide the Company with the flexibility to make such issuances from
time to time for any proper purpose approved by the Board of Directors,
including issuances to effect acquisitions or raise capital and issuances in
connection with future stock splits or dividends, without the necessity of
delaying such activities for further stockholder approval except as may be
required in a particular case by the Company's charter documents, applicable law
or the rules of any stock exchange or other system on which the Company's
securities may then be listed. There are currently no arrangements, agreements
or understandings for the issuance or use of additional shares of authorized
Common Stock (other than issuances permitted or required under the Company's
stock-based employee benefit plans or awards made pursuant to those plans).
The additional Common Stock to be authorized by adoption of the proposed
amendment would have rights identical to the currently outstanding Common Stock
of the Company. Adoption of the proposed amendment and issuance of the Common
Stock would not affect the rights of the holders of currently outstanding Common
Stock, except for effects incidental to increasing the number of shares of the
Common Stock outstanding, such as dilution of earnings per share and voting
rights of current holders of Common Stock. The holders of Common Stock do not
presently have preemptive rights to subscribe for the additional Common Stock
proposed to be authorized. If the amendment is adopted, it will become effective
upon filing of a Certificate of Amendment of the Company's Second Amended and
Restated Certificate of Incorporation with the Secretary of State of Delaware.
The proposal could have an anti-takeover effect, although that is not its
intention. For example, if the Company were the subject of a hostile takeover
attempt, it could try to impede the takeover by issuing shares of Common Stock,
thereby diluting the voting power of the other outstanding shares and increasing
the potential cost of the takeover. The availability of this defensive strategy
to the Company could discourage unsolicited takeover attempts, thereby limiting
the opportunity for the Company's stockholders to realize a higher price for
their shares than is generally available in the public markets. The Board of
Directors is not aware of any attempt, or contemplated attempt, to acquire
control of the Company, and this proposal is not being presented with the intent
that it be utilized as a type of anti-takeover device.
STOCKHOLDER APPROVAL
The affirmative vote of a majority of the Company's outstanding voting
shares is required for approval of the amendments to the Company's Second
Amended and Restated Certificate of Incorporation authorizing an increase from
50,000,000 to 100,000,000 shares of Common Stock.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" APPROVAL
OF THE AMENDMENT TO THE COMPANY'S SECOND AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK.
6
<PAGE>
PROPOSAL 4
AMENDMENT TO THE AMENDED AND RESTATED
1998 STOCK OPTION/STOCK ISSUANCE PLAN
The Company's stockholders are being asked to approve an amendment to the
Plan which will increase the number of shares of the Company's Common Stock
reserved for issuance under the Plan by an additional 4,000,000 shares.
The Board of Directors adopted the amendment on March 28, 2000, subject to
stockholder approval at this Annual Meeting.
The Board believes the amendment is necessary to assure that a sufficient
reserve of Common Stock remains available for issuance under the Plan in order
to allow the Company to continue to utilize equity incentives to attract and
retain the services of key individuals essential to the Company's long-term
growth and financial success. The Company relies significantly on equity
incentives in the form of stock option grants in order to attract and retain key
employees and believes that such equity incentives are necessary for the Company
to remain competitive in the marketplace for executive talent and other key
employees. Option grants made to newly-hired or continuing employees will be
based on both competitive market conditions and individual performance.
On August 20, 1999, the Board also adopted the Company's 1999 Non-Officer
Stock Option/Stock Issuance Plan (the "1999 Plan"). Currently, 800,000 shares of
Common Stock have been authorized for issuance under the 1999 Plan only to
non-officer employees of the Company and consultants or other independent
advisors (excluding Board members) who provide services to the Company or its
subsidiaries. Such share reserve consists of (i) 400,000 shares initially
reserved for issuance under the 1999 Plan on August 20, 1999, plus (ii) an
additional increase of 400,000 shares of Common Stock approved by the Board on
November 30, 1999. At present, options to purchase 714,524 shares of Common
Stock have been granted pursuant to the 1999 Plan.
The following is a summary of the principal features of the Plan, as most
recently amended. Any stockholder of the Company who wishes to obtain a copy of
the actual plan document may do so upon written request to the Company at 220
East 42nd Street, 24th Floor, New York, NY 10017.
1. EQUITY INCENTIVE PROGRAMS
The Plan consists of three (3) separate equity incentive programs: (i) the
Discretionary Option Grant Program, (ii) the Stock Issuance Program and
(iii) the Automatic Option Grant Program for non-employee Board members. The
principal features of each program are described below. The Compensation
Committee of the Board will have the exclusive authority to administer the
Discretionary Option Grant and Stock Issuance Programs with respect to option
grants and stock issuances made to the Company's executive officers and
non-employee Board members and will also have the authority to make option
grants and stock issuances under those programs to all other eligible
individuals. However, the Board may at any time appoint a secondary committee of
one or more Board members to have separate but concurrent authority with the
Compensation Committee to make option grants and stock issuances under those two
programs to individuals other than the Company's executive officers and
non-employee Board members.
The term Plan Administrator, as used in this summary, will mean the
Compensation Committee and any secondary committee, to the extent each such
entity is acting within the scope of its administrative jurisdiction under the
Plan. However, neither the Compensation Committee nor any secondary committee
will exercise any administrative discretion under the Automatic Option Grant.
All grants under those programs will be made in strict compliance with the
express provisions of such programs.
7
<PAGE>
2. SHARE RESERVE
At present, a total of 7,224,885 shares of Common Stock have been reserved
in the aggregate by the Board of Directors for issuance over the term of the
Plan. Such share reserve consists of (i) the 3,224,885 shares initially reserved
for issuance under the Plan, plus (ii) the additional increase of 4,000,000
shares of Common Stock which forms part of this Proposal.
No participant in the Plan may receive option grants, separately exercisable
stock appreciation rights or direct stock issuances for more than 267,000 shares
of Common Stock in the aggregate per calendar year. Stockholder approval of this
Proposal will also constitute a reapproval of the 267,000-share limitation for
purposes of Internal Revenue Code Section 162(m).
The shares of Common Stock issuable under the Plan may be drawn from shares
of the Company's authorized but unissued shares of such common stock or from
shares of such common stock reacquired by the Company, including shares
repurchased on the open market.
In the event any change is made to the outstanding shares of Common Stock by
reason of any recapitalization, stock dividend, stock split, combination of
shares, exchange of shares or other change in corporate structure effected
without the Company's receipt of consideration, appropriate adjustments will be
made to the securities issuable under the Plan (in the aggregate, annually and
to each participant) and the securities and the exercise price per share in
effect under each outstanding option.
3. ELIGIBILITY
Officers and employees, non-employee Board members and independent
consultants in the service of the Company or its parent and subsidiaries
(whether now existing or subsequently established) will be eligible to
participate in the Discretionary Option Grant and Stock Issuance Programs.
Non-employee members of the Board will also be eligible to participate in the
Automatic Option Grant Program.
Presently four executive officers, five non-employee Board members and 865
other employees and consultants are eligible to participate in the Discretionary
Option Grant and Stock Issuance Programs. Five non-employee Board members are
also eligible to participate in the Automatic Option Grant Program.
4. VALUATION
The fair market value per share of Common Stock on any relevant date under
the Plan will be deemed to be equal to the closing selling price per share on
that date on the Nasdaq National Market. On March 24, 2000, the fair market
value per share determined on such basis was $88.375.
5. DISCRETIONARY OPTION GRANT PROGRAM
The Plan Administrator will have complete discretion under the Discretionary
Option Grant Program to determine which eligible individuals are to receive
option grants, the time or times when those grants are to be made, the number of
shares subject to each such grant, the status of any granted option as either an
incentive stock option or a non-statutory option under the federal tax laws, the
vesting schedule (if any) to be in effect for the option grant and the maximum
term for which any granted option is to remain outstanding.
Each granted option will have an exercise price per share no less than the
fair market value of the option shares on the grant date unless otherwise
determined by the Plan Administrator. No granted option will have a term in
excess of ten (10) years, and the option will generally become exercisable in
one or more installments over a specified period of service measured from the
grant date.
Upon cessation of service, the optionee will have a limited period of time
in which to exercise any outstanding option to the extent exercisable for vested
shares. The Plan Administrator will have complete discretion to extend the
period following the optionee's cessation of service during which his or her
outstanding options may be exercised and/or to accelerate the exercisability or
vesting of such options in
8
<PAGE>
whole or in part. Such discretion may be exercised at any time while the options
remain outstanding, whether before or after the optionee's actual cessation of
service.
In addition, the Plan Administrator is authorized to issue two types of
stock appreciation rights in connection with option grants made under the
Discretionary Option Grant Program.
TANDEM STOCK APPRECIATION RIGHTS. Tandem stock appreciation rights
under the Discretionary Option Grant Program provide the holders with the
right to surrender their options for an appreciation distribution from the
Company. The amount of such distribution will be equal to the excess of
(i) the fair market value of the vested shares of Common Stock subject to
the surrendered option over (ii) the aggregate exercise price payable for
such shares. Such appreciation distribution may, at the discretion of the
Plan Administrator, be made in cash or in shares of Common Stock.
LIMITED STOCK APPRECIATION RIGHTS. Limited Stock Appreciation Rights
may be granted to officers of the Company as part of their option grants and
may be surrendered to the Company upon the successful completion of a
hostile take-over of the Company. In return for the surrendered option, the
officer will be entitled to a cash distribution from the Company in an
amount per surrendered option share equal to the excess of (i) the take-over
price per share over (ii) the exercise price payable for such share.
The Plan Administrator also has the authority to effect the cancellation of
any or all options outstanding under the Discretionary Option Grant Program and
to grant, in substitution therefor, new options covering the same or a different
number of shares of Common Stock but with an exercise price per share based upon
the fair market value of the option shares on the new grant date.
6. STOCK ISSUANCE PROGRAM
Shares of Common Stock may be issued under the Stock Issuance Program at a
price per share no less than fair market value unless otherwise determined by
the Plan Administrator. The shares may also be issued as a bonus for past
services without any cash outlay required of the recipient. The shares issued
may be fully vested upon issuance or may vest upon the completion of a
designated service period or the attainment of pre-established performance
goals. The Plan Administrator will, however, have the discretionary authority at
any time to accelerate the vesting of any and all unvested shares outstanding
under the Stock Issuance Program.
7. AUTOMATIC OPTION GRANT PROGRAM
Under the Automatic Option Grant Program, eligible non-employee Board
members will receive a series of option grants over their period of Board
service. Each non-employee Board member will, at the time of his or her initial
election or appointment to the Board, receive an option grant for 20,000 shares
of Common Stock, provided such individual has not previously been in the
Company's employ. In addition, on the date of each Annual Stockholders Meeting,
each individual who is to continue to serve as a non-employee Board member will
automatically be granted an option to purchase 5,000 shares of Common Stock,
provided he or she has served as a non-employee Board member for at least six
(6) months. There will be no limit on the number of such 5,000-share option
grants any one eligible non-employee Board member may receive over his or her
period of continued Board service, and non-employee Board members who have
previously been in the Company's employ will be eligible to receive one or more
such annual option grants over their period of Board service.
Stockholder approval of this Proposal will also constitute pre-approval of
each option granted under the Automatic Option Grant Program after the date of
the Annual Meeting and the subsequent exercise of that option in accordance with
the terms of the program summarized below.
Each automatic grant will have an exercise price per share equal to the fair
market value per share of Common Stock on the grant date and will have a maximum
term of 10 years, subject to earlier termination following the optionee's
cessation of Board service. Each automatic option will be immediately
exercisable
9
<PAGE>
for all of the option shares; however, any unvested shares purchased under such
option will be subject to repurchase by the Company, at the exercise price paid
per share, should the optionee cease Board service prior to vesting in those
shares. The shares subject to each initial 20,000-share automatic option grant
will vest in a series of four (4) successive equal annual installments upon the
optionee's completion of each year of Board service over the four (4)-year
period measured from the grant date. The shares subject to each annual
5,000-share automatic grant will vest upon the optionee's completion of one
(1) year of Board service measured from the grant date. However, the shares
subject to each outstanding automatic option grant will immediately vest in full
upon certain changes in control or ownership of the Company or upon the
optionee's death or disability while a Board member. Following the optionee's
cessation of Board service for any reason, each option will remain exercisable
for a 12-month period and may be exercised during that time for any or all
shares in which the optionee is vested at the time of such cessation of Board
service.
Each option granted under the Automatic Option will include a limited stock
appreciation right. Upon the successful completion of a hostile tender offer for
more than fifty percent (50%) of the Company's outstanding voting securities or
a change in a majority of the Board as a result of one or more contested
elections for Board membership, each outstanding option under the Automatic
Option Grant may be surrendered to the Company in return for a cash distribution
from the Company. The amount of the distribution per surrendered option share
will be equal to the excess of (i) the fair market value per share at the time
the option is surrendered or, if greater, the tender offer price paid per share
in the hostile take-over over (ii) the exercise price payable per share under
such option.
Stockholder approval of this Proposal will also constitute pre-approval of
each limited stock appreciation right granted under the Automatic Option Grant
and the subsequent exercise of that right in accordance with the foregoing
terms.
8. GENERAL PROVISIONS
a. Acceleration
In the event that the Company is acquired by merger or asset sale, each
outstanding option under the Discretionary Option Grant Program which is not
assumed or replaced by the successor corporation will automatically accelerate
in full, and all unvested shares outstanding under the Discretionary Option
Grant and Stock Issuance Programs will immediately vest, except to the extent
the Company's repurchase rights with respect to those shares are to be assigned
to the successor corporation.
The Plan Administrator will have the authority under the Discretionary
Option Grant Program to provide that options will vest immediately upon (i) an
acquisition, whether or not the options are to be assumed, (ii) upon a change in
control (whether effected through the successful completion of a tender offer
for more than 50% of the Company's outstanding voting stock or a change in the
majority of the Board effected through one or more contested elections for Board
membership) or (iii) a subsequent termination of the optionee's service within a
designated period following an acquisition in which those options are assumed on
a change in control. The vesting of outstanding options under the Stock Issuance
Program may be accelerated upon certain terms and conditions.
The acceleration of vesting in the event of a change in the ownership or
control of the Company may be seen as an anti-takeover provision and may have
the effect of discouraging a merger proposal, a takeover attempt or other
efforts to gain control of the Company.
b. Financial Assistance
The Plan Administrator may institute a loan program to assist one or more
participants in financing the exercise of outstanding options under the
Discretionary Option Grant Program or the purchase of shares under the Stock
Issuance Program through full-recourse interest-bearing promissory notes.
However, the maximum amount of financing provided any participant may not exceed
the cash
10
<PAGE>
consideration payable for the issued shares plus all applicable taxes incurred
in connection with the acquisition of those shares.
c. Special Tax Election
The Plan Administrator may provide one or more holders of non-statutory
options or unvested share issuances under the Plan with the right to have the
Company withhold a portion of the shares otherwise issuable to such individuals
in satisfaction of the withholding taxes to which such individuals become
subject in connection with the exercise of those options or the vesting of those
shares. Alternatively, the Plan Administrator may allow such individuals to
deliver previously acquired shares of common stock in payment of such
withholding tax liability.
d. Amendment and Termination
The Board may amend or modify the Plan at any time, subject to any required
stockholder approval pursuant to applicable laws and regulations. Unless sooner
terminated by the Board, the Plan will terminate on the earliest of
(i) July 2, 2008, (ii) the date on which all shares available for issuance under
the Plan have been issued as fully-vested shares or (iii) the termination of all
outstanding options in connection with certain changes in control or ownership
of the Company.
9. STOCK AWARDS
The table below shows, as to the Company's Chief Executive Officer and the
other executive officers who served as executive officers during the year ended
December 31, 1999 and whose salary and bonus exceeded $100,000 in 1999 for
services rendered in all capacities to the Company during 1999 (together, the
"Named Executive Officers") and the other individuals and groups indicated, the
number of shares of Common Stock subject to option grants made under the Plan
from January 1, 1999 through February 15, 2000, together with the weighted
average exercise price payable per share. The Company has not made any direct
stock issuances to date under the Plan.
OPTION TRANSACTIONS
<TABLE>
<CAPTION>
WEIGHTED
NUMBER OF SHARES AVERAGE
UNDERLYING EXERCISE PRICE
NAME AND POSITION OPTIONS GRANTED(#) PER SHARE($)
- ----------------- ------------------ --------------
<S> <C> <C>
Scott P. Kurnit
Chief Executive Officer and Director...................... 195,800 $27.50
William C. Day
President and Chief Operating Officer..................... 135,280 $25.00
Todd B. Sloan
Chief Financial Officer................................... 82,300 $13.36
Jon Spaet
President--Advertising Sales.............................. 80,000 $35.65
Alan T. Wragg
President--International.................................. 42,799 $23.83
All current executive officers (4) as a group............... 443,380 $25.78
All current non-employee directors (5) as a group........... 17,800 $25.00
All employees, including current officers who are
not executive officers, as a group........................ 1,458,533 $29.54
</TABLE>
As of February 15, 2000, 2,337,391 shares of Common Stock were subject to
outstanding options under the Plan, 755,811 shares of Common Stock had been
issued upon exercise of options granted under the Plan and 4,131,683 shares of
Common Stock remained available for future issuance, assuming stockholder
approval of this Proposal.
11
<PAGE>
10. FEDERAL INCOME TAX CONSEQUENCES
OPTION GRANTS
Options granted under the Plan may be either incentive stock options which
satisfy the requirements of Section 422 of the Internal Revenue Code or
non-statutory options which are not intended to meet such requirements. The
Federal income tax treatment for the two types of options differs as follows:
INCENTIVE OPTIONS. No taxable income is recognized by the optionee at the
time of the option grant, and no taxable income is generally recognized at the
time the option is exercised. The optionee will, however, recognize taxable
income in the year in which the purchased shares are sold or otherwise made the
subject of a taxable disposition. For Federal tax purposes, dispositions are
divided into two categories: (i) qualifying and (ii) disqualifying. A qualifying
disposition occurs if the sale or other disposition is made after the optionee
has held the shares for more than two (2) years after the option grant date and
more than one (1) year after the exercise date. If either of these two holding
periods is not satisfied, then a disqualifying disposition will result.
Upon a qualifying disposition, the optionee will recognize long-term capital
gain in an amount equal to the excess of (i) the amount realized upon the sale
or other disposition of the purchased shares over (ii) the exercise price paid
for the shares. If there is a disqualifying disposition of the shares, then the
excess of (i) the fair market value of those shares on the exercise date over
(ii) the exercise price paid for the shares will be taxable as ordinary income
to the optionee. Any additional gain or loss recognized upon the disposition
will be recognized as a capital gain or loss by the optionee.
If the optionee makes a disqualifying disposition of the purchased shares,
then the Company will be entitled to an income tax deduction, for the taxable
year in which such disposition occurs, equal to the excess of (i) the fair
market value of such shares on the option exercise date over (ii) the exercise
price paid for the shares. If the optionee makes a qualifying disposition, the
Company will not be entitled to any income tax deduction.
NON-STATUTORY OPTIONS. No taxable income is recognized by an optionee upon
the grant of a non-statutory option. The optionee will in general recognize
ordinary income, in the year in which the option is exercised, equal to the
excess of the fair market value of the purchased shares on the exercise date
over the exercise price paid for the shares, and the optionee will be required
to satisfy the tax withholding requirements applicable to such income.
If the shares acquired upon exercise of the non-statutory option are
unvested and subject to repurchase by the Company in the event of the optionee's
termination of service prior to vesting in those shares, then the optionee will
not recognize any taxable income at the time of exercise but will have to report
as ordinary income, as and when the Company's repurchase right lapses, an amount
equal to the excess of (i) the fair market value of the shares on the date the
repurchase right lapses over (ii) the exercise price paid for the shares. The
optionee may, however, elect under Section 83(b) of the Internal Revenue Code to
include as ordinary income in the year of exercise of the option an amount equal
to the excess of (i) the fair market value of the purchased shares on the
exercise date over (ii) the exercise price paid for such shares. If the
Section 83(b) election is made, the optionee will not recognize any additional
income as and when the repurchase right lapses.
The Company will be entitled to an income tax deduction equal to the amount
of ordinary income recognized by the optionee with respect to the exercised
non-statutory option. The deduction will in general be allowed for the taxable
year of the Company in which such ordinary income is recognized by the optionee.
STOCK APPRECIATION RIGHTS
No taxable income is recognized upon receipt of a stock appreciation right.
The holder will recognize ordinary income, in the year in which the stock
appreciation right is exercised, in an amount equal to the
12
<PAGE>
excess of the fair market value of the underlying shares of common stock on the
exercise date over the base price in effect for the exercised right, and the
holder will be required to satisfy the tax withholding requirements applicable
to such income.
The Company will be entitled to an income tax deduction equal to the amount
of ordinary income recognized by the holder in connection with the exercise of
the stock appreciation right. The deduction will be allowed for the taxable year
in which such ordinary income is recognized.
DIRECT STOCK ISSUANCES
The tax principles applicable to direct stock issuances under the Plan will
be substantially the same as those summarized above for the exercise of
non-statutory option grants.
DEDUCTIBILITY OF EXECUTIVE COMPENSATION
The Company anticipates that any compensation deemed paid by it in
connection with the disqualifying dispositions of incentive stock option shares
or the exercise of non-statutory options with exercise prices equal to the fair
market value of the option shares on the grant date will qualify as
performance-based compensation for purposes of Code Section 162(m) and will not
have to be taken into account for purposes of the $1 million limitation per
covered individual on the deductibility of the compensation paid to certain
executive officers of the Company. Accordingly, all compensation deemed paid
with respect to those options will remain deductible by the Company without
limitation under Code Section 162(m).
ACCOUNTING TREATMENT
Option grants under the Plan with exercise prices equal to the fair market
value of the option shares on the grant date will not result in any direct
charge to the Company's reported earnings. However, the fair value of those
options is required to be disclosed in the notes to the Company's financial
statements, and the Company must also disclose, in footnotes to the Company's
financial statements, the pro-forma impact those options would have upon the
Company's reported earnings were the fair value of those options at the time of
grant treated as a compensation expense. In addition, the number of outstanding
options may be a factor in determining the Company's earnings per share on a
fully-diluted basis.
Option grants or stock issuances made under the Plan with exercise or issue
prices less than the fair market value of the shares on the grant or issue date
will result in a direct compensation expense to the Company in an amount equal
to the excess of such fair market value over the exercise or issue price. The
expense must be amortized against the Company's earnings over the period that
the option shares or issued shares are to vest.
On March 31, 1999, the Financial Accounting Standards Board issued an
exposure draft of a proposed interpretation of APB Opinion No. 25 governing the
accounting principles applicable to equity incentive plans. Under the proposed
interpretation, as subsequently modified on August 11, 1999, option grants made
to non-employee consultants (but not non-employee Board members) after
December 15, 1998 will result in a direct charge to the Company's reported
earnings based upon the fair value of the option measured initially as of the
grant date and then subsequently on the vesting date of each installment of the
underlying option shares. Such charge will accordingly include the appreciation
in the value of the option shares over the period between the grant date of the
option (or, if later, the effective date of the final interpretation) and the
vesting date of each installment of the option shares. In addition, if the
proposed interpretation is adopted, any options which are repriced after
December 15, 1998 will also trigger a direct charge to Company's reported
earnings measured by the appreciation in the value of the underlying shares over
the period between the grant date of the option (or, if later, the effective
date of the final amendment) and the date the option is exercised for those
shares.
Should one or more individuals be granted tandem stock appreciation rights
under the Plan, then such rights would result in a compensation expense to be
charged against the Company's reported earnings.
13
<PAGE>
Accordingly, at the end of each fiscal quarter, the amount (if any) by which the
fair market value of the shares of common stock subject to such outstanding
stock appreciation rights has increased from the prior quarter-end would be
accrued as compensation expense, to the extent such fair market value is in
excess of the aggregate exercise price in effect for those rights.
11. NEW PLAN BENEFITS
As of February 15, 2000, no stock options had been granted, and no shares of
Common Stock had been issued, on the basis of the share increase which is the
subject of this Proposal. Pursuant to the Automatic Option Grant Program, on the
date of the Annual Meeting, options to purchase 5,000 shares of Common Stock
will be granted to each of Messrs. Biondi, Wood and Unterman and options to
purchase 20,000 shares of Common Stock will be granted to each of Mr. Fung and
Ms. Kis.
STOCKHOLDER APPROVAL
The affirmative vote of at least a majority of the outstanding shares of
Common Stock present in person or by proxy at the Annual Meeting and entitled to
vote is required for approval of the amendment to the Plan. Should such
stockholder approval not be obtained, then the 4,000,000-share increase to the
share reserve under the Plan will not be implemented, any stock options granted
under the Plan on the basis of that increase will immediately terminate without
ever becoming exercisable for the shares of Common Stock subject to those
options, and no additional options or stock issuances will be made on the basis
of such increase. The Plan will, however, continue in effect, and option grants
and direct stock issuances may continue to be made under the Plan until all the
shares available for issuance under the Plan has been issued pursuant to such
option grants and direct stock issuances.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
APPROVAL OF THE AMENDMENT TO THE PLAN.
14
<PAGE>
EXECUTIVE COMPENSATION, MANAGEMENT AND OTHER INFORMATION
MANAGEMENT
The following table sets forth, as of February 15, 2000, the name, age and
position of each of our executive officers and other key employees:
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Scott P. Kurnit...... 46 Chief Executive Officer and Chairman of the Board of
Directors
William C. Day....... 35 President and Chief Operating Officer
Todd B. Sloan........ 37 Chief Financial Officer
Jon Spaet............ 43 President--Advertising Sales
Alan T. Wragg........ 56 President--International
Eric W. Bingham...... 40 Senior Vice President--Business Operations
Alan P. Blaustein.... 30 President--Corporate Development
John R. Caplan....... 30 General Manager and Chief Marketing Officer
Ron McCoy............ 30 Senior Vice President--Technology and Operations
Linda Osborne........ 39 Senior Vice President--Content
</TABLE>
INFORMATION CONCERNING EXECUTIVE OFFICERS AND OTHER KEY EMPLOYEES WHO ARE NOT
DIRECTORS
WILLIAM C. DAY has served as the Company's President and Chief Operating
Officer since January 2000 and as Chief Operating Officer since he co-founded
About.com in June 1996. From December 1998 until January 1999, Mr. Day also
served as About.com's Chief Financial Officer. From October 1995 to June 1996,
Mr. Day served as Vice President, Software Development for Prodigy Service Co.
From July 1994 to October 1995, Mr. Day served as Vice President, General
Manager for Content and Community for Prodigy, and from May 1993 to July 1994,
he served as Director, Internet Development for Prodigy. Mr. Day received his
B.S. in Mechanical Engineering from Yale University, and an M.B.A. from The
Wharton School of the University of Pennsylvania.
TODD B. SLOAN has served as the Company's Chief Financial Officer since
January 1999. From August 1996 to October 1998, Mr. Sloan served as Executive
Vice President/Chief Operating Officer for SW Networks (a wholly owned
subsidiary of Sony Music since November 1997 and a wholly owned subsidiary of
Sony Corporation of America from February 1995 to October 1997). From
February 1995 to October 1998, Mr. Sloan also served as Chief Financial Officer
of SW Networks. From September 1985 to February 1995, Mr. Sloan served in
various capacities, including Senior Manager, for Ernst & Young. Mr. Sloan
received his B.B.A in Accounting and Finance from the University of
Wisconsin/Madison. Mr. Sloan is a C.P.A.
JON SPAET has served as the Company's President--Advertising Sales since
July 1999. From May 1993 to July 1999, Mr. Spaet served as Vice President of
Advertising Sales for MSNBC, a joint venture of General Electric Company's NBC
unit and Microsoft Corporation. Mr. Spaet received his B.S. in Management and
Marketing and an M.B.A. in Finance from New York University.
ALAN T. WRAGG has served as the Company's President--International since
July 1999. From August 1996 to July 1999, Mr. Wragg served as our
President--Advertising Sales and E-Commerce. From September 1987 to
August 1996, Mr. Wragg served as the Publisher of TVSM, Inc., now owned by News
Corporation, a U.S. publisher of cable television programming guides, including
The Cable Guide, Total TV Weekly and Total TV Online. Mr. Wragg also spent
14 years at Time Inc. as Advertising Director at LIFE Monthly and as a sales
executive at Sports Illustrated. Mr. Wragg received his B.B.A. in Marketing from
Cleveland State University, and an M.B.A. from Adelphi University.
ERIC W. BINGHAM has served as the Company's Senior Vice President--Business
Operations since July 1996. From June 1995 to June 1996, Mr. Bingham served as
Director, Business Development for News
15
<PAGE>
Corporation, an international media company. From January 1990 to May 1995,
Mr. Bingham served as Director, International Operations for Home Box Office, a
division of Time Warner Inc. Mr. Bingham received his B.A. in History from
Allegheny College, and an M.B.A. from Boston University.
ALAN P. BLAUSTEIN has served as the Company's President--Corporate
Development since February 2000. From April 1999 until February 2000,
Mr. Blaustein served as the Company's Senior Vice President and General Counsel.
From August 1995 to April 1999, Mr. Blaustein was an associate with Brobeck,
Phleger & Harrison LLP, a law firm specializing in emerging growth technologies
companies. Mr. Blaustein received his B.S. in Accounting from Binghamton
University and a J.D. from New York University School of Law.
JOHN R. CAPLAN has served as the Company's General Manager and Chief
Marketing Officer since January 2000. From November 1998 until January 2000,
Mr. Caplan served as the Company's Senior Vice President--Marketing. From
October 1995 to November 1998, Mr. Caplan served as Director of Marketing for
Berenter Greenhouse & Webster, an advertising and marketing agency specializing
in consumer brands. From October 1994 to September 1995, he served as President
of Advertising & Diversity, Inc., a marketing strategy firm. From
September 1991 to October 1994, Mr. Caplan served as an Account Executive for
TDI Worldwide (now owned by CBS Corporation), an outdoor advertising company.
Mr. Caplan received his B.A. in English from the University of Rochester.
RON MCCOY has served as the Company's Senior Vice President--Technology and
Operations since April 1999. From 1993 to April 1999, Mr. McCoy served in
various capacities for Cox Enterprises, a multimedia company, most recently as
the Chief Technology Officer and Director of Operations for Cox Interactive
Media.
LINDA OSBORNE has served as the Company's Senior Vice President--Content
since February 2000 and Vice President--Content since August 1999. From
December 1997 to August 1999, Ms. Osborne served as the Programming Director of
ParentSoup.com, one of the communities of iVillage Inc. From June 1996 to
August 1997, Ms. Osborne served as Executive Producer for West Side
Films/Interactive. From May 1992 to June 1996, Ms. Osborne was an Executive
Producer with CEL Educational Resources Inc. From February 1987 to May 1992,
Ms. Osborne wrote and produced a variety of programming as head of her own
independent production service. From September 1980 to February 1987,
Ms. Osborne served as Senior Writer/Producer for Broad Street Productions,
Drexel Burnham Lambert's video production unit. Ms. Osborne received her B.A.
from New York University in Broadcast Journalism.
16
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the compensation received during each of the
last three years by the Company's Named Executive Officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION (1) -----------------
----------------------- OTHER ANNUAL SHARES UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS
- --------------------------- -------- --------- ----------- ------------ -----------------
<S> <C> <C> <C> <C> <C>
Scott P. Kurnit 1999 $280,050 $1,300,000 -- 195,800
Chief Executive Officer........... 1998 170,750 100,000 -- 9,204
1997 138,125 100,000 -- 21,475
William C. Day 1999 225,000 435,000 -- 135,280
President and Chief Operating
Officer........................... 1998 125,625 25,000 -- 74,012
1997 109,687 -- -- 180,090
Todd B. Sloan 1999 158,555 25,000 -- 82,300
Chief Financial Officer........... 1998 -- -- -- --
1997 -- -- -- --
Jon Spaet(2) 1999 117,361 30,000 -- 70,000
President--Advertising Sales...... 1998 -- -- -- --
1997 -- -- -- --
Alan Wragg(3) 1999 165,500 112,693(3) -- 42,799
President--International.......... 1998 137,732 -- -- 11,840
1997 131,250 -- -- 118,449
</TABLE>
- ------------------------
(1) In accordance with the rules of the Commission, other compensation in the
form of perquisites and other personal benefits has been omitted for each of
the Named Executive Officers because the aggregate amount of such
perquisites and other personal benefits constituted less than the lesser of
$50,000 or 10% of the total of annual salary and bonuses for each of the
Named Executive Officers in 1999.
(2) Mr. Spaet joined the Company in July 1999. His annual salary is $250,000.
(3) Bonus for Mr. Wragg includes $92,693 of commissions. During 1998, Mr. Wragg
served as President--Advertising Sales and E-Commerce.
17
<PAGE>
OPTION GRANTS IN LAST YEAR
The following table sets forth information regarding options granted to the
Named Executive Officers during 1999. Each option represents the right to
purchase one share of common stock and was granted pursuant to the Plan. These
options become exercisable at a rate of 25% following one year from the date of
grant with the remainder vesting ratably for the following 36 months. The
Company has not granted any stock appreciation rights.
OPTION GRANTS DURING YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
---------------------------------------------------------- POTENTIAL REALIZABLE VALUE AT
NUMBER OF % OF TOTAL ASSUMED ANNUAL
SECURITIES OPTIONS RATES OF STOCK
UNDERLYING GRANTED TO APPRECIATION FOR OPTION TERM(3)
OPTIONS EMPLOYEES EXERCISE MARKET EXPIRATION ------------------------------------
NAME GRANTED IN 1999(1) PRICE(2) PRICE DATE 0% 5% 10%
- --------------------- ---------- ---------- -------- -------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Scott P. Kurnit...... 195,800 7.05 $27.50 $25.00 2/4/09 -- $2,588,476 $7,311,172
William C. Day....... 135,280 4.87 25.00 25.00 2/4/09 -- 2,126,602 5,389,555
Todd B. Sloan........ 20,000 0.72 41.875 41.875 12/1/09 -- 461,700 1,137,300
62,300 2.24 4.21 25.00 1/14/09 $1,295,217 2,274,573 3,777,249
Jon Spaet............ 40,000 1.44 23.00 23.00 6/14/09 -- 578,400 1,466,400
15,000 0.54 46.00 46.00 11/08/09 -- 380,400 937,050
15,000 0.54 41.875 41.875 12/1/09 -- 346,275 852,975
Alan T. Wragg........ 24,999 0.90 23.00 23.00 6/14/09 -- 361,486 916,463
17,800 0.64 25.00 25.00 2/4/09 -- 279,816 709,152
</TABLE>
- ------------------------
(1) During 1999, the Company granted employees options to purchase an aggregate
of 2,775,707 shares of common stock.
(2) The exercise price may be paid in cash or in shares of Common Stock valued
at fair market value on the exercise date. Alternatively, the option may be
exercised through a cashless exercise procedure pursuant to which the
optionee provides irrevocable instructions to a brokerage firm to sell the
purchased shares and to remit to the Company, out of the sale proceeds, an
amount equal to the exercise price plus all applicable withholding taxes.
The Compensation Committee may also assist an optionee in the exercise of an
option by (i) authorizing a loan from the Company in a principal amount not
to exceed the aggregate exercise price plus any tax liability incurred in
connection with the exercise or (ii) permitting the optionee to pay the
option price in installments over a period of years upon terms established
by the Compensation Committee.
(3) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. The 0%, 5%
and 10% assumed annual rates of compounded stock price appreciation are
mandated by rules of the Commission and do not represent the Company's
estimate or projection of its future common stock prices. These amounts
represent certain assumed rates of appreciation in the value of the
Company's common stock from the fair market value on the date of grant.
Actual gains, if any, on stock option exercises are dependent on the future
performance of the common stock and overall stock market conditions. The
amounts reflected in the table may be more or less than the amounts actually
achieved.
18
<PAGE>
OPTION EXERCISES AND YEAR-END VALUES
The following table sets forth information concerning options to purchase
common stock exercised by the Named Executive Officers during 1999 and the
number and value of unexercised options held by each of the Named Executive
Officers at December 31, 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE
REALIZED
(MARKET
PRICE AT
SHARES EXERCISE NUMBER OF SECURITIES
ACQUIRED LESS UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
ON EXERCISE OPTIONS AT IN-THE-MONEY OPTIONS AT
NAME EXERCISE PRICE) DECEMBER 31, 1999 DECEMBER 31, 1999(1)
- ---- -------- ---------- --------------------------- ---------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Scott P. Kurnit................. -- -- 30,678 195,800 $2,735,864 $12,678,050
William C. Day.................. 113,320 $3,646,007 96,217 178,965 8,574,428 12,635,987
Todd B. Sloan................... -- -- -- 82,300 -- 6,286,642
Jon Spaet....................... -- -- -- 70,000 -- 4,044,375
Alan Wragg...................... 28,000 1,421,274 97,690 47,398 8,717,782 3,229,349
</TABLE>
- ------------------------
(1) These values have been calculated on the basis of the closing price on
December 31, 1999 of $89 3/4 per share, determined on the basis of the
closing market price per share of Common Stock on the Nasdaq National
Market, less the applicable exercise price per share, multiplied by the
number of shares underlying such options.
EMPLOYMENT, SEVERANCE AND OTHER AGREEMENTS
The Company and Mr. Kurnit are parties to a letter agreement dated
October 20, 1996, as amended, governing his employment with the Company. In the
event that Mr. Kurnit is terminated without cause, he shall be entitled to be
paid his base salary for 12 months following the date of his termination. In
addition, if Mr. Kurnit is involuntarily terminated within 12 months following a
change in control, all of his unvested stock options will immediately vest and
become fully exercisable.
The Company and Mr. Sloan are parties to a letter agreement dated
January 11, 1999, governing his employment with the Company. In the event that
Mr. Sloan is terminated without cause, he shall be entitled to be paid his base
salary for 3 months following the date of his termination. In addition, if
Mr. Sloan is involuntarily terminated within 12 months following a change of
control, all of his unvested stock options will immediately vest and become
fully exercisable.
The Company and Mr. Spaet are parties to a letter agreement dated June 15,
1999, governing his employment with the Company. In the event Mr. Spaet is
terminated without cause during the first year of his employment, he shall be
entitled to the greater of three months salary or twelve months salary less the
aggregate amount of base salary paid to him as of the date of termination. After
the first year of his employment, he shall be entitled to be paid three months
of his salary upon a termination without cause.
19
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
The Compensation Committee of the Board of Directors advises the Chief
Executive Officer and the Board of Directors on matters of the Company's
compensation philosophy and the compensation of executive officers and other
individuals compensated by the Company. The Compensation Committee is also
responsible for the administration of the Company's stock option plans under
which option grants and direct stock issuances may be made to executive
officers. The Compensation Committee has reviewed and is in accord with the
compensation paid to executive officers in 1999.
GENERAL COMPENSATION POLICY. The fundamental policy of the Compensation
Committee is to provide the Company's executive officers with competitive
compensation opportunities based upon their contribution to the Company's
development and financial success and their personal performance. It is the
Compensation Committee's objective to have a portion of each executive officer's
compensation contingent upon the Company's performance as well as upon such
executive officer's own level of performance. Accordingly, the compensation
package for each executive officer is comprised of three elements: (i) base
salary, (ii) cash bonus payment and (iii) long-term stock-based incentive awards
which strengthen the mutuality of interests between the executive officers and
the Company's stockholders.
FACTORS. The principal factors which the Compensation Committee considered
with respect to each executive officer's compensation package for fiscal year
1999 are summarized below. The Compensation Committee may, however, in its
discretion apply entirely different factors in advising the Chief Executive
Officer and the Board of Directors with respect to executive compensation for
future years.
- BASE SALARY. The suggested base salary for each executive officer is
determined on the basis of the following factors: experience, personal
performance, the salary levels in effect for comparable positions within and
without the industry and internal base salary comparability considerations. The
weight given to each of these factors differs from individual to individual, as
the Compensation Committee deems appropriate.
- BONUS. Under special circumstances, the Compensation Committee has the
discretion to pay cash bonuses to executive officers based on both individual
performance as well as performance of the Company when predetermined performance
goals are met or exceeded. Bonuses are determined and paid annually.
- LONG-TERM INCENTIVE COMPENSATION. Long-term incentives are provided
through grants of stock options. The grants are designed to align the interests
of each executive officer with those of the stockholders and provide each
individual with a significant incentive to manage the Company from the
perspective of an owner with an equity stake in the Company. Each option
generally becomes exercisable in installments over a four year period,
contingent upon the executive officer's continued employment with the Company.
Accordingly, the option grant will provide a return to the executive officer
only if the executive officer remains employed by the Company during the vesting
period, and then only if the market price of the underlying shares appreciates.
The number of shares subject to each option grant is set at a level intended
to create a meaningful opportunity for stock ownership based on the executive
officer's current position with the Company, the base salary associated with
that position, the size of comparable awards made to individuals in similar
positions within the industry, the individual's potential for increased
responsibility and promotion over the option term and the individual's personal
performance in recent periods. The Compensation Committee also considers the
number of unvested options held by the executive officer in order to maintain an
appropriate level of equity incentive for that individual. However, the
Compensation Committee does not adhere to any specific guidelines as to the
relative option holdings of the Company's executive officers.
20
<PAGE>
Stock options to purchase an aggregate of 526,179 shares of Common Stock were
granted to executive officers in 1999.
CEO COMPENSATION. The plans and policies discussed above were the basis for
the 1999 compensation of the Company's Chief Executive Officer, Mr. Scott P.
Kurnit. Mr. Kurnit was excluded from all discussions by the Board of Directors
and the Compensation Committee regarding his own compensation. In advising the
Board of Directors with respect to this compensation, the Compensation Committee
seeks to achieve two objectives: (i) establish a level of base salary
competitive with that paid by companies within the industry which are of
comparable size to us and by companies outside of the industry with which the
Company competes for executive talent and (ii) make a significant percentage of
the total compensation package contingent upon the Company's performance and
stock price appreciation. In accordance with these objectives, Mr. Kurnit
received a base salary of $280,050 and a bonus of $1,300,000 for fiscal year
1999. Mr. Kurnit's 1999 compensation was based on the actual financial
performance of the Company in achieving designated corporate objectives and
attaining a strategic revenue objective measured against competitors'
performance. Options to purchase 195,800 shares of common stock were granted to
Mr. Kurnit in fiscal year 1999 and he currently holds a total of 226,478
unexercised stock options.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M). As a result of
Section 162(m) of the Internal Revenue Code of 1986, as amended, which was
enacted into law in 1993, the Company will not be allowed a federal income tax
deduction for compensation paid to certain executive officers, to the extent
that compensation exceeds $1 million per officer in any one year. This
limitation will apply to all compensation paid to the covered executive officers
which is not considered to be performance based. Compensation that does qualify
as performance-based compensation will not have to be taken into account for
purposes of this limitation. Compensation paid to the Company's executive
officers for the 1999 fiscal year exceeded the $1 million limit per officer only
by an insubstantial amount for one executive officer, and the Compensation
Committee has decided not to take any action at this time to limit or
restructure the elements of cash compensation payable to the Company's executive
officers. The Company's stock plans contain certain provisions that are intended
to ensure that any compensation deemed paid in connection with the exercise of
stock options granted under that plan with an exercise price equal to the market
price of the option shares on the grant date will qualify as performance-based
compensation.
THE 1999 COMPENSATION COMMITTEE
Dixon R. Doll
Scott P. Kurnit
Ronald Unterman
Marc M. Watson
21
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of our Common Stock as of February 15, 2000, by:
- each Director and nominee for Director,
- each of the Named Executive Officers,
- each person (or group of affiliated persons) who is known by the Company
to be a beneficial owner of 5% or more of the outstanding shares of Common
stock, and
- all of the Company's Directors and executive officers as a group.
In accordance with the Commission's rules, the following table gives effect
to the shares of Common stock that could be issued upon the exercise of
outstanding options and warrants within 60 days of February 15, 2000. Unless
otherwise indicated in the footnotes to the table, the following individuals
have sole vesting and sole investment control with respect to the shares they
beneficially own. Unless otherwise indicated in the footnotes to the table, the
address of each of the individual's listed below is c/o About.com, Inc., 220
East 42nd Street, 24th floor, New York, New York 10017.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
COMMON STOCK PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED OWNERSHIP
- ------------------------------------ --------------------------- ----------
<S> <C> <C>
Scott P. Kurnit (1)......................................... 1,444,705 8.7
Frank J. Biondi, Jr. (2).................................... 18,800 *
Dixon R. Doll (3)........................................... 805,127 4.9
Ronald Unterman............................................. 14,800 *
Marc M. Watson (4).......................................... 942,540 5.7
Kristopher Wood............................................. 7,197 *
Stanley Fung (5)............................................ 784,049 4.7
Daphne Kis.................................................. 200 *
William C. Day (6).......................................... 211,910 1.3
Todd B. Sloan (7)........................................... 4,794 *
Jon Spaet (8)............................................... 0 *
Alan T. Wragg (9)........................................... 5,636 *
C-Max Capital Limited Partnership-I (10).................... 922,740 5.6
Mackenzie Financial Corporation (11)........................ 936,900 5.7
Putnam Investments, Inc. (12)............................... 2,144,875 13.0
The TCW Group, Inc. (13).................................... 1,345,042 8.1
All Directors and current executive officers as a group (9
persons) (14)............................................. 3,449,873 20.5
</TABLE>
- ------------------------
* Less than one percent.
(1) Includes 87,786 shares issuable upon the exercise of stock options
exercisable within 60 days of February 15, 2000. Does not include 138,692
shares issuable upon the exercise of options that are not exercisable within
60 days of February 15, 2000.
(2) Includes 1,000 shares owned by Mr. Biondi's spouse. Includes 17,800 shares
issuable upon the exercise of options exercisable within 60 days of
February 15, 2000.
(3) Includes 55,262 shares held by the Dixon and Carol Doll Family Trust, of
which Mr. Doll is a beneficiary. Also includes:
- 683,470 shares beneficially owned by Doll Technology Investment Fund;
- 40,213 shares beneficially owned by Doll Technology Affiliates Fund, L.P.;
and
22
<PAGE>
- 26,182 shares beneficially owned by Doll Technology Side Fund, L.P.
Mr. Doll is the managing member of Doll Technology Investment Management,
L.L.C., the general partner of each of these funds. Mr. Doll disclaims
beneficial ownership of the shares held by these funds except to the extent
of his pecuniary interest in each of them.
(4) Includes 922,740 shares beneficially owned by C-Max Capital Limited
Partnership-I, of which Mr. Watson is a director. Mr. Watson disclaims
beneficial ownership of the shares held by C-Max Capital Limited
Partnership-I except to the extent of his pecuniary interest therein. On
February 24, 2000, C-Max Capital Limited Partnership-I distributed all
shares held by it to its partners.
(5) Includes (a) 592,532 shares beneficially owned by Zero Stage Capital V, L.P.
("ZSC V"), of which Mr. Fung is the general partner and (b) 182,565 shares
beneficially owned by Zero Stage Capital VI, L.P. ("ZSC VI"), of which
Mr. Fung is the managing director. Mr. Fung disclaims beneficial ownership
of the shares held by ZSC V and ZSC VI except to the extent of his pecuniary
interest therein.
(6) Includes 131,310 shares issuable upon the exercise of options exercisable
within 60 days of February 15, 2000. Does not include 133,872 shares
issuable upon the exercise of options that are not exercisable within
60 days of February 15, 2000.
(7) Includes 3,893 shares issuable upon the exercise of options exercisable
within 60 days of February 15, 2000. Does not include 62,832 shares issuable
upon the exercise of options that are not exercisable within 60 days of
February 15, 2000.
(8) Does not include 80,000 shares issuable upon the exercise of options that
are not exercisable within 60 days of February 15, 2000.
(9) Includes 5,636 shares issuable upon the exercise of options exercisable
within 60 days of February 15, 2000. Does not include 41,614 shares issuable
upon the exercise of options that are not exercisable within 60 days of
February 15, 2000.
(10) The address of C-Max Capital Limited Partnership-I is 2950 SW 27th Avenue,
Suite 110, Miami, FL 33133. On February 24, 2000, C-Max Capital Limited
Partnership-I distributed all shares held by it to its partners.
(11) The address of Mackenzie Financial Corporation is 150 Bloor Street West,
Suite M111, Toronto, Ontario M5S 3B5. All shares are owned by various
accounts managed by Mackenzie Financial Corporation.
(12) Includes (a) 1,995,708 shares held by Putnam Investment Management, Inc.
("PIM") and (b) 149,167 shares held by The Putnam Advisory Company, Inc.
("PAC"). PIM and PAC are wholly-owned subsidiaries of Putnam
Investments, Inc., a wholly-owned subsidiary of Marsh & McLennan
Companies, Inc. Of the 1,995,708 shares held by PIM, 1,692,408 shares are
held by Putnam OTC Emerging Growth Fund. The address of Putnam
Investments, Inc. is One Post Office Square, Boston, Massachusetts 02109.
(13) The address of The TCW Group, Inc. is 865 South Figueroa Street, Los
Angeles, CA 90017.
(14) Includes 240,789 shares issuable upon the exercise of stock options
exercisable within 60 days of February 15, 2000. Does not include beneficial
ownership of Mr. Wragg, who was not an executive officer as of February 15,
2000.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's Directors and officers, and persons who
own more than 10% of a registered class of the Company's equity securities, to
file with the Commission initial reports of ownership and reports of
23
<PAGE>
changes in ownership of Common Stock and other equity securities of the Company.
Directors, officers and greater than ten percent holders are required by
Commission regulations to furnish the Company with copies of all Section 16(a)
reports they file.
To the Company's knowledge, based solely on review of the copies of the
above-mentioned reports furnished to the Company and written representations
regarding all reportable transactions, during the fiscal year ended
December 31, 1999, all Section 16(a) filing requirements were complied with on
time, except for one late filing by each of Mr. Sloan and Mr. Wood.
PERFORMANCE GRAPH
The following graph compares the quarterly change in the Company's
cumulative total stockholder return on its Common Stock during a period
commencing on March 24, 1999 (the initial public offering of the Company's
Common Stock) and ending on December 31, 1999 (as measured by dividing (i) the
sum of (A) the cumulative amount of dividends (if any) for the measurement
period, assuming dividend interest, and (B) the excess of the Company's share
price at the end of the measurement period over the price at the beginning of
the measurement period, by (ii) the share price at the beginning of the
measurement period) with the cumulative total return so calculated of the Nasdaq
Stock Market--U.S. Index and a self-constructed peer group index.
COMPARISON OF QUARTERLY CUMULATIVE TOTAL RETURN*
AMONG ABOUT.COM, INC., THE NASDAQ STOCK MARKET (U.S.)
INDEX AND A PEER GROUP (1)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DATE BOUT NASDAQ COMPOSITE
<S> <C> <C> <C>
24-Mar-1999 100.0000 100.0000 100.0000
30-Jun-1999 109.2105 113.5646 92.1578
30-Sep-1999 118.9474 116.1029 86.8058
31-Dec-1999 188.9474 172.0435 114.1426
</TABLE>
* Assumes $100 invested on March 24, 1999 in stock or index, including
reinvestment of dividends.
(1) The Peer Group consists of the following companies: AskJeeves, Inc.; Cnet
Networks, Inc.; Goto.com, Inc.; iVillage, Inc.; LookSmart, Ltd.;
Lycos, Inc.; Marketwatch.com, Inc.; Sportsline.com, Inc. and ZDNet.
24
<PAGE>
STOCKHOLDER PROPOSALS FOR THE 2001 ANNUAL MEETING
In accordance with regulations issued by the Securities and Exchange
Commission (the "Commission"), stockholder proposals intended for presentation
at the 2001 Annual Meeting of Stockholders (the "2001 Annual Meeting") must be
received by the Secretary of the Company no later than the close of business on
January 9, 2001 and no earlier than the close of business on December 10, 2000
if such proposals are to be considered for inclusion in the Company's Proxy
Statement. In addition, the proxy solicited by the Board of Directors for the
2001 Annual Meeting will confer discretionary authority to vote on any
stockholder proposal raised at the 2001 Annual Meeting which is not described in
the 2001 Proxy Statement unless the Company has received notice of such
proposal, as described above. However, if the date of the 2001 Annual Meeting is
more than 30 days before May 9, 2001 or more than 60 days after May 9, 2001,
notice by the stockholder must be delivered after the close of business on the
90(th) day prior to the 2001 Annual Meeting and by the close of business on the
60(th) day prior to the 2001 Annual Meeting or the close of business on the
10(th) day following the date on which a public announcement of the 2001 Annual
Meeting is first announced. However, if the Company determines to change the
date of the 2001 Annual Meeting more than 30 days from May 9, 2001, the Company
will provide stockholders with a reasonable time before it begins to print and
mail its proxy materials for the 2001 Annual Meeting in order to allow such
stockholders an opportunity to make proposals in accordance with the rules and
regulations of the Commission.
FORM 10-K
The Company filed an Annual Report on Form 10-K for fiscal year 1999 with
the Securities and Exchange Commission on March 30, 2000. Stockholders may
obtain a copy of this report without charge, by writing to Investor Relations,
at the Company's principal offices located at 220 East 42nd Street, 24th Floor,
New York, New York 10017.
OTHER MATTERS
Management knows of no matters that are to be presented for action at the
Annual Meeting other than those set forth above. If any other matters properly
come before the Annual Meeting, the persons named in the enclosed form of proxy
will vote the shares represented by proxies in accordance with their best
judgment on such matters.
Proxies will be solicited by mail and may also be solicited in person or by
telephone by some regular employees of the Company. The Company may also
consider the engagement of a proxy solicitation firm. Costs of the solicitation
will be borne by the Company.
By Order of the Board of Directors
SCOTT P. KURNIT
CHIEF EXECUTIVE OFFICER AND
CHAIRMAN OF THE BOARD
New York, New York
April 10, 2000
25
<PAGE>
APPENDIX A (EDGAR FILING ONLY)
FORM OF PROXY
26
<PAGE>
(Form of Proxy)
ABOUT.COM, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS--May 9, 2000
(THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY)
The undersigned stockholder of About.com, Inc. hereby appoints Scott P.
Kurnit and Todd B. Sloan, and each of them, with full power of substitution,
proxies to vote the shares of stock which the undersigned could vote if
personally present at the Annual Meeting of Stockholders of About.com, Inc. to
be held at the Hotel Intercontinental of New York, 111 East 48th Street, New
York, New York, 10017 on May 9, 2000 at 9:00 a.m. (New York time).
<TABLE>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS FOR nominees below WITHHOLD AUTHORITY
(for terms as (EXCEPT AS MARKED TO THE CONTRARY) / / TO VOTE FOR NOMINEES BELOW / /
described in the
Proxy Statement)
</TABLE>
NOMINEES: Scott P. Kurnit, Frank J. Biondi, Jr., Stanley Fung, Daphne Kis,
Ronald Unterman, Kristopher Wood
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR AN INDIVIDUAL NOMINEE, WRITE THE
NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.
- --------------------------------------------------------------------------------
2. RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
/ / FOR / / AGAINST / / ABSTAIN WITH RESPECT TO
proposal to ratify the selection of KPMG LLP, independent public accountants,
as auditors of the Company for the fiscal year ending December 31, 2000, as
described in the Proxy Statement.
3. APPROVAL OF AMENDMENT TO THE SECOND AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION
/ / FOR / / AGAINST / / ABSTAIN WITH RESPECT TO
the proposal to approve the amendment to the Company's Second Amended and
Restated Certificate of Incorporation.
4. APPROVAL OF AMENDMENT TO OPTION PLAN
/ / FOR / / AGAINST / / ABSTAIN WITH RESPECT TO
<PAGE>
proposal to approve the amendment to the Company's Amended and Restated 1998
Stock Option/Stock Issuance Plan (the "Plan") including the increase in the
number of shares of Common Stock authorized for issuance over the term of the
Plan by an additional 4,000,000 shares.
5. IN THEIR DISCRETION UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR PROPOSALS 1, 2, 3
AND 4 AS SET FORTH IN THE PROXY STATEMENT.
Please date and sign exactly as your name appears on the envelope in which
this material was mailed. If shares are held jointly, each stockholder should
sign. Executors, administrators, trustees, etc. should use full title and, if
more than one, all should sign. If the stockholder is a corporation, please
sign full corporate name by an authorized officer. If the stockholder is a
partnership, please sign full partnership name by an authorized person.
__________________________________
Name(s) of Stockholder
__________________________________
Signature(s) of Stockholder
Dated:____________________________
