<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant ( X )
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) 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 Rule 14a-11(c) or Rule 14a-12
CDI CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
( X ) No Fee Required
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
1) Title of each class of securities to which transaction
applies:
---------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
---------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------
5) Total fee paid:
---------------------------------------------------------------
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
----------------------------------------------------
2) Form, Schedule or Registration Statement No.:
----------------------------------------------------
3) Filing Party:
----------------------------------------------------
4) Date Filed:
----------------------------------------------------
<PAGE>
[CDI Corp. logo appears here]
1717 Arch Street, 35th Floor
Philadelphia, Pennsylvania 19103-2768
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 29, 1999
To Shareholders:
The Annual Meeting of the Shareholders of CDI Corp. (the "Company"), a
corporation organized under the laws of the Commonwealth of Pennsylvania, will
be held in the Trumbauer West Room on the 51st Floor of the Bell Atlantic
Tower, 1717 Arch Street, Philadelphia, Pennsylvania 19103, on Thursday, April
29, 1999, at 10:00 A.M., for the following purposes:
1. To elect nine directors of the Company to serve during the ensuing year
or until their successors have been duly elected and qualified;
2. To act upon a shareholder proposal recommending the sale of the
Company's subsidiary, Todays Staffing, Inc.; and
3. To transact such other business as may properly come before the meeting
or any and all adjournments or postponements of the meeting.
Only shareholders of record on March 10, 1999 are entitled to notice of and to
vote at the Annual Meeting. If you do not expect to attend the meeting in
person and desire to have the stock registered in your name represented and
voted at the meeting, please fill in, sign, date and promptly return the
enclosed proxy card in the accompanying envelope. No postage is necessary if
mailed in the United States. If you attend the meeting, you may revoke your
proxy and vote in person.
By Order of the Board of Directors
/s/ Joseph R. Seiders
JOSEPH R. SEIDERS, Secretary
Dated: April 5, 1999
Philadelphia, Pennsylvania
<PAGE>
[CDI Corp. logo appears here]
1717 Arch Street, 35th Floor
Philadelphia, Pennsylvania 19103-2768
-----------------------------------------------
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 29, 1999
-----------------------------------------------
GENERAL INFORMATION
This Proxy Statement and the accompanying Proxy are furnished in connection
with the solicitation of proxies by the Board of Directors (the "Board") of
CDI Corp. (the "Company") to be used at the Annual Meeting of Shareholders to
be held on Thursday, April 29, 1999 at 10:00 A.M. in the Trumbauer West Room
on the 51st Floor of the Bell Atlantic Tower, 1717 Arch Street, Philadelphia,
Pennsylvania and at any and all adjournments or postponements of that meeting.
The date of mailing of this Proxy Statement and the Proxy to the Company's
shareholders is on or about April 5, 1999.
The solicitation of proxies is being handled by the Company at its cost,
principally through the use of the mails. If it appears desirable to do so in
order to assure adequate representation of shareholders at the meeting,
officers and other employees of the Company may communicate with shareholders,
banks, brokerage firms or nominees by telephone or in person to request that
proxies be furnished in time for the meeting. No solicitation is being made by
specially engaged employees of the Company or paid solicitors.
If the enclosed Proxy is executed and returned, it may, nevertheless, be
revoked by giving written notice of such revocation to the Secretary of the
Company at any time prior to the voting thereof. The Proxy is in such a form
that authority to vote for the election of all or any one of the directors can
be withheld and that separate approval or disapproval can be indicated with
respect to Proposal Two, which is identified in the Proxy and is set forth and
commented upon in this Proxy Statement. The shares represented by the Proxy
will be voted for the election of all of the directors unless authority to do
so is withheld, and will be voted against Proposal Two unless a contrary
choice is specified.
ANNUAL REPORT
The Company's Annual Report to Shareholders for the year ended December 31,
1998 is being mailed to all shareholders together with this Proxy Statement.
That report is not to be regarded as proxy solicitation material or as a part
of this Proxy Statement.
1
<PAGE>
VOTING RIGHTS
There were outstanding and entitled to vote, as of March 10, 1999,
19,050,039 shares of the common stock, par value $.10 per share, of the
Company ("CDI Stock"), the only class of stock of the Company now issued and
outstanding. Shareholders are entitled to one vote for each share of CDI Stock
held. The presence, in person or by proxy, of a majority of the number of
outstanding shares of CDI Stock entitled to vote at the Annual Meeting will
constitute a quorum for the transaction of business. A quorum being present,
proposals will be decided by a majority of the votes cast, in person and by
proxy, at the Annual Meeting by all shareholders entitled to vote thereon.
Shares represented by proxies that reflect abstentions and shares referred to
as "broker nonvotes" (i.e., shares held by brokers or nominees as to which
instructions have not been received from beneficial owners and as to which the
broker or nominee does not have discretionary voting power on a particular
matter, such as Proposal Two described below) will be treated as being present
for purposes of determining the presence of a quorum but will not constitute a
vote cast with respect to any matter. Only shareholders of record at the close
of business on March 10, 1999 will be entitled to vote at the meeting.
PRINCIPAL SHAREHOLDERS AND MANAGEMENT STOCK OWNERSHIP
As of February 15, 1999, the following persons and entities were known by
the Company to be beneficial owners of more than 5% of the outstanding CDI
Stock. The following table shows, as of that date, the number of shares of CDI
Stock so owned and the percentage of outstanding CDI Stock represented by the
number of shares so owned.
<TABLE>
<CAPTION>
Number of Shares Percentage of
Name and Address of of CDI Stock Outstanding
Beneficial Owner Owned Beneficially* CDI Stock
------------------- ------------------- -------------
<S> <C> <C>
Donald W. Garrison, Lawrence C. Karlson, 5,672,488(1) 29.4%
Joseph A. Teti, Jr. and Barton J. Winokur,
as Trustees of various trusts for the
benefit of Walter R. Garrison's children
c/o Paul Wm. Putney, Esquire
Dechert Price & Rhoads
4000 Bell Atlantic Tower
1717 Arch Street
Philadelphia, PA 19103
Walter R. Garrison 1,765,105(2) 9.2%
1717 Arch Street, 35th Floor
Philadelphia, PA 19103-2768
</TABLE>
- --------
* Except as indicated in the footnotes below, the Company is informed that
the respective beneficial owners have sole voting power and sole investment
power with respect to the shares shown opposite their names.
(1) Each trustee under these trusts has joint voting and investment power
with the other trustees with respect to these shares but disclaims any
beneficial interest except as a fiduciary. Those trustees who are also
directors of the Company own of record and beneficially the number of
shares of CDI Stock shown opposite their names on the following table.
(2) Includes 15,259 shares held by Mr. Garrison's wife, 61,988 shares held by
a trust for the benefit of Mr. Garrison's wife (of which Mr. Garrison is a
trustee) and 42 shares for which Mr. Garrison's wife is custodian. Does
not include the shares held by the various family trusts referred to in
this table or 175,000 shares held by The Garrison Foundation or 32,000
shares held by The Garrison Family Foundation. See footnotes (3) and (5)
to the following table.
2
<PAGE>
The following table sets forth, as to each director, director nominee and
executive officer of the Company individually and as to all directors,
director nominees and executive officers of the Company as a group, the number
of shares of CDI Stock owned as of February 1, 1999 and the percentage of
outstanding CDI Stock represented by the number of shares so owned.
<TABLE>
<CAPTION>
Number of Shares Percentage of
of CDI Stock Outstanding
Name of Individual or Group Owned Beneficially* CDI Stock
- --------------------------- ------------------- -------------
<S> <C> <C>
Walter E. Blankley 13,175 (1) Less than .1%
Brian J. Bohling 8,570 (2) Less than .1%
John M. Coleman 2,500 Less than .1%
Walter R. Garrison 1,773,355 (3)(4)(5) 9.2%
Kay Hahn Harrell 1,000 Less than .1%
Lawrence C. Karlson 46,800 (1)(4) .2%
Allen M. Levantin 27,175 (6) .1%
Robert J. Mannarino 21,438 (7) .1%
Alan B. Miller 14,175 (1) Less than .1%
John D. Sanford 15,400 (8) Less than .1%
Joseph R. Seiders 15,864 (9) Less than .1%
Mitch Wienick 93,469 (10) .5%
Barton J. Winokur 204,717 (4)(5)(11) 1.1%
All directors, director nominees and
executive officers as a group (13
persons) 2,242,638 (12) 11.7%
</TABLE>
- --------
* Except as indicated in the footnotes below, the Company is informed that
the respective beneficial owners have sole voting power and sole investment
power with respect to the shares shown opposite their names.
(1) Includes 12,175 shares which Messrs. Blankley, Karlson and Miller each
presently has the right to acquire through the exercise of options.
(2) Includes 3,125 shares of restricted stock which are subject to vesting and
5,070 shares which Mr. Bohling presently has the right to acquire through
the exercise of options. For more information regarding the vesting terms
of the restricted stock and stock options, see below under the caption
"Employment Agreement with Brian J. Bohling".
(3) Includes 15,259 shares held by Mr. Garrison's wife, 61,988 shares held by
a trust for the benefit of Mr. Garrison's wife (of which Mr. Garrison is a
trustee) and 42 shares for which Mr. Garrison's wife is custodian. Does
not include the 32,000 shares held by The Garrison Family Foundation,
which is a charitable trust. Mr. Garrison is one of eleven trustees of The
Garrison Family Foundation, but disclaims beneficial ownership of the
foundation's shares except as a fiduciary.
(4) Does not include 5,672,488 shares of CDI Stock held in various trusts
created by Walter R. Garrison for the benefit of his children. These
shares are referenced above in the Principal Shareholders table under the
names of the trustees of the various trusts. Two of the trustees, Mr.
Karlson and Mr. Winokur, are directors of the Company and a third trustee,
Donald W. Garrison, is Walter R. Garrison's brother. Walter R. Garrison
disclaims beneficial ownership of these shares, as do the trustees except
as fiduciaries.
3
<PAGE>
(5) Does not include 175,000 shares held by The Garrison Foundation, a
charitable trust established for the benefit of the Pennsylvania
Institute of Technology. Among the four trustees of The Garrison
Foundation are Messrs. Garrison and Winokur, who are directors of the
Company. The trustees disclaim beneficial ownership of these shares
except as fiduciaries.
(6) Includes 17,175 shares which Mr. Levantin presently has the right to
acquire through the exercise of options.
(7) Includes 120 shares held by Mr. Mannarino's wife, 5,500 shares of
restricted stock which are subject to vesting and 12,000 shares which Mr.
Mannarino presently has the right to acquire through the exercise of
options. For more information regarding the vesting terms of the
restricted stock and stock options, see below under the caption
"Employment Agreement with Robert J. Mannarino".
(8) Includes 4,860 shares of restricted stock which are subject to vesting
and 10,000 shares which Mr. Sanford presently has the right to acquire
through the exercise of options. For more information regarding the
vesting terms of the restricted stock and stock options, see below under
the caption "Employment Agreement with John D. Sanford".
(9) Includes 3,264 shares which Mr. Seiders has the right to acquire, either
presently or within 60 days, through the exercise of options.
(10) Includes 24,000 shares of restricted stock which are subject to vesting
and 50,000 shares which Mr. Wienick has the right to acquire, within 60
days, through the exercise of options. For more information regarding the
vesting terms of the restricted stock and stock options, see below under
the caption "Employment Agreement with Mitch Wienick".
(11) Does not include 19,000 shares held by a foundation of which Mr. Winokur
is the sole trustee. Mr. Winokur has no beneficial interest in the income
or assets of that foundation and disclaims beneficial ownership of those
shares except as a fiduciary.
(12) If the 5,672,488 shares held in the Garrison family trusts referred to in
footnote (4) above, the 175,000 shares held by The Garrison Foundation
and the 32,000 shares held by The Garrison Family Foundation were
combined with the 2,242,638 shares shown in the table as held by
directors, director nominees and executive officers as a group, the total
would be 8,122,126 shares or 42.2% of the outstanding CDI Stock.
PROPOSAL ONE
ELECTION OF DIRECTORS
Nine directors are to be elected at the Annual Meeting of Shareholders, to
hold office until the next Annual Meeting of Shareholders or until their
successors are elected and qualified. The persons named in the enclosed Proxy
(Joseph R. Seiders and Craig H. Lewis) have advised the Company that they
intend to vote FOR the nine nominees below unless authority to do so is
withheld. Each of these nominees has been designated by the Board of
Directors. Each of the nominees is currently a member of the Board. The Board
is not aware of any reason why any nominee will be unable to stand for
election as a director or serve if elected, but if any such nominee should
become unavailable, the Board may nominate, and the persons named in the
accompanying Proxy may vote for, a substitute nominee.
4
<PAGE>
Information About the Nominees
The following table sets forth information about the nominees for election to
the Board of Directors.
<TABLE>
<CAPTION>
Director of Principal Present Position, Business Experience
Name Age Company Since** During Past Five Years and Other Directorships
- ---- --- --------------- -----------------------------------------------
<S> <C> <C> <C>
Walter E. Blankley #(S) 63 1994 Chairman of the Board (since 1993) and Chief
Executive Officer (since 1990) of AMETEK,
Inc., Paoli, PA (manufacturer of air moving
electric motors and precision electronic
instruments); Director of Amcast Industrial
Corporation
John M. Coleman # 49 1998 Private investor and consultant; Former
Senior Vice President and General Counsel of
The Gillette Company, Boston, MA (1997-
1999); Senior Vice President, Law and Public
Affairs of Campbell Soup Company, Camden, NJ
from 1990 to 1997
Walter R. Garrison *+(S) 72 1958 Chairman of the Board of the Company;
Chairman, President and Chief Executive
Officer of the Company from 1961 until April
1997
Kay Hahn Harrell + 58 1998 Chairman and Chief Executive Officer of
Fairmarsh Consulting, St. Simons Island, GA
since 1993; Director of Wheelabrator
Technologies Inc. (1995-1997) and of
Chemical Waste Management Inc. (1993-1996)
Lawrence C. Karlson *(S) 56 1989 Private investor and consultant; Director
and non-executive Chairman of AmeriSource
Health Corporation; Director of Spectra-
Physics Lasers, Inc. and Vlasic Foods
International Inc.
Allen M. Levantin + 66 1989 Retired Chairman and Chief Executive Officer
of Todays Temporary, Inc., now known as
Todays Staffing, Inc., a subsidiary of the
Company (1994-1997)
Alan B. Miller # 61 1994 Chairman of the Board, President and Chief
Executive Officer of Universal Health
Services, Inc., King of Prussia, PA
(hospital management and health care
services) since 1978; Director and Chairman
of the Board of Universal Health Realty
Income Trust; Director of Genesis Health
Ventures Inc. and Penn Mutual Life Insurance
Co.
Mitch Wienick *(S) 50 1997 President and Chief Executive Officer of the
Company since April 1997; President-Consumer
Services, Ameritech Corporation (1995-March
1997); President-Small Business Services,
Ameritech Corporation (1993-1995)
Barton J. Winokur *+ 59 1968 Chairman and Partner in the law firm of
Dechert Price & Rhoads, Philadelphia, PA;
Director of AmeriSource Health Corporation
</TABLE>
5
<PAGE>
- --------
* Member of the Executive Committee
+ Member of the Audit Committee
# Member of the Compensation and Stock Option Committee
(S)Member of the Governance Committee
** References to periods served as a director of the Company include periods
served as a director of CDI Corporation, the Company's predecessor
registrant under the Securities Exchange Act of 1934.
Information About the Board and its Committees
The Board of Directors of the Company held six meetings during 1998. The
Board of Directors has four standing committees: an Executive Committee, an
Audit Committee, a Compensation and Stock Option Committee, and a Governance
Committee (formerly known as the Nominating Committee).
The Executive Committee has the general authority of the Board, subject to
certain limitations, to act on behalf of the Board. This Committee held nine
meetings during 1998, and acted on three other occasions by unanimous written
consent.
The Audit Committee reviews with KPMG LLP, the Company's independent
auditors, the proposed scope of their examination and their subsequent report
on each annual audit, preliminary to the consideration thereof by the full
Board of Directors; monitors the independence of the auditors; and reviews the
Company's internal accounting controls, practices and policies as well as the
Company's internal audit function. The Audit Committee held three meetings
during 1998.
The Compensation and Stock Option Committee is responsible for setting and
administering the policies and programs that govern executive compensation
(including the Company's stock option plans). This Committee held six meetings
during 1998 and acted on five other occasions by unanimous written consent.
The Governance Committee (formerly known as the Nominating Committee)
advises the Company on corporate governance matters, including the evaluation
of Board and Board Committee performance. In addition, the Governance
Committee provides the Board of Directors with recommendations relating to the
selection of new members of the Board. The Committee evaluates possible
candidates, assists in attracting qualified candidates and interviews
candidates prior to making its recommendations to the Board. Shareholders
wishing to recommend candidates for nomination to the Board of Directors
should submit to the Secretary of the Company the name, a statement of
qualifications and the written consent of the candidate. Recommendations may
be submitted at any time and will be brought to the attention of the
Governance Committee. The Governance Committee held six meetings during 1998.
6
<PAGE>
Compensation of Directors
As compensation for a director's service on the Board, each director who is
not a full-time employee of the Company or one of its subsidiaries is eligible
to receive a retainer fee of $50,000 per year as compensation for the
director's service on the Board, with each committee chairman receiving an
additional $5,000. Of the retainer fee, $30,000 is paid in the form of Company
stock options (having an exercise price equal to the market value of CDI Stock
at the time of grant), and the balance is paid in cash in quarterly
installments. The number of options is determined each year using a Black-
Scholes valuation. However, any director eligible to be paid a retainer fee
but whose compensation for service as a director is included in the income of
a corporation or partnership of which the director is an employee or partner,
is paid the entire retainer fee in cash. In addition to the retainer fee, each
eligible director is paid meeting attendance fees of $1,000 for each Board
meeting and $500 for each Committee meeting held on a date other than the date
of a Board meeting.
The Company has consulting arrangements with two of its directors, Walter R.
Garrison and Lawrence C. Karlson, which resulted in compensation to those
directors during 1998.
In April 1997, in connection with the retirement of Mr. Garrison as
President and Chief Executive Officer of the Company, the Company and Mr.
Garrison entered into a three-year Consulting Agreement. Mr. Garrison agreed
to render up to 60 days of consulting services to the Company during the first
year and up to 45 days of consulting services during each of the second and
third years. The Consulting Agreement also contains certain covenants
restricting Mr. Garrison from competing with the Company and from soliciting
the Company's customers or management employees for a period of five years. In
consideration for the consulting services and the restrictive covenants, the
Company agreed to pay Mr. Garrison $450,000 per year during the three-year
consulting term. During 1998, Mr. Garrison earned consulting fees of $450,000.
Mr. Karlson's arrangement provides for him to furnish consulting services as
requested from time to time by the Chief Executive Officer of the Company, for
which Mr. Karlson is paid a fee of $4,000 for each eight-hour day that he
provides such services and is reimbursed for the expenses that he incurs in
connection with providing such services. During 1998, Mr. Karlson earned
consulting fees of $63,375.
7
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
Identification of Executive Officers
The Board of Directors of the Company annually elects the executive officers
of the Company, traditionally at the meeting of the Board immediately
following the Annual Meeting of Shareholders. The Company's executive officers
during 1998 were:
Mitch Wienick, President and Chief Executive Officer. For additional
information about Mr. Wienick, see the table earlier in this Proxy
Statement under the caption "Information about the Nominees".
Robert J. Mannarino, age 41, has been the Company's Executive Vice
President and Chief Operating Officer since August 1997. Prior to joining
the Company, Mr. Mannarino was the Chief Operating Officer of the
Investment Services Division of Checkfree Corp. (a provider of electronic
data processing services). From 1995 to 1996, he was the Chief Operating
Officer of Security APL, Inc. (an investment services firm). From 1992 to
1995, he was Division Vice President in the Employer Services Division of
Automatic Data Processing Inc.
John D. Sanford, age 45, has been the Company's Executive Vice President
and Chief Financial Officer since November 1997. Prior to joining the
Company, he was Senior Vice President and Chief Financial Officer of Waste
Management, Inc. (beginning in January 1997). From May 1996 to January
1997, he was Vice President and Treasurer of Waste Management, Inc. From
1993 to January 1997, Mr. Sanford was the Chief Financial Officer of
Wheelabrator Technologies Inc., a developer, owner and operator of waste-
to-energy facilities.
Brian J. Bohling, age 38, has been the Company's Senior Vice President,
Human Resources since July 1997. Prior to joining the Company, Mr. Bohling
was Vice President, Human Resources, Frozen & Specialty Foods, at Campbell
Soup Company. From April 1995 to June 1996, he was Director, Human
Resources, Meal Enhancement Group at Campbell Soup Company. From 1993 to
1995, Mr. Bohling worked at AlliedSignal, Inc., first as an Area Director,
Human Resources, and then as Director, Human Resources, Technology &
Operations.
Joseph R. Seiders, age 50, has been the Company's Senior Vice President
and General Counsel since 1987.
8
<PAGE>
Summary Compensation Table
The following table sets forth certain information regarding the
compensation for services to the Company and its subsidiaries during the last
three fiscal years which was earned by each person who was an executive
officer of the Company during 1998. The five executives who are included in
this Summary Compensation Table are referred to in this Proxy Statement as the
"Named Executive Officers". Messrs. Wienick, Mannarino and Sanford joined the
Company during 1997, so information provided for them for 1997 reflects a
partial year and no information is provided for them for 1996. Mr. Bohling and
Mr. Seiders first became executive officers of the Company in early 1998, and
so no information is provided for them for 1997 or 1996.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
-------------------- ----------------------------------
All Other
Name and Principal Restricted Stock Securities Under- Compensation
Position Year Salary($) Bonus($) Awards($)(1) lying Options(#) ($)(2)
------------------ ---- ---------- --------- ---------------- ----------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Mitch Wienick, 1998 500,000 50,000 0 0 58,458
President and 1997 365,393 303,314 1,061,250 250,000 17,853
Chief Executive Officer 1996 -- -- -- -- --
(beginning in April
1997)
Robert J. Mannarino, 1998 275,000 33,300 0 0 22,489
Executive Vice President 1997 105,776 136,105 231,000 60,000 4,514
and Chief Operating 1996 -- -- -- -- --
Officer (beginning in
August 1997)
John D. Sanford, 1998 265,000 26,000 0 0 15,485
Executive Vice 1997 35,675 17,931 218,700 50,000 1,009
President and Chief 1996 -- -- -- -- --
Financial Officer
(beginning in November
1997)
Brian J. Bohling, 1998 225,000 41,850 0 0 19,189
Senior Vice President, 1997 -- -- -- -- --
Human Resources 1996 -- -- -- -- --
Joseph R. Seiders, 1998 248,000 23,320 0 1,324 13,921
Senior Vice President 1997 -- -- -- -- --
and General Counsel 1996 -- -- -- -- --
</TABLE>
- --------
(1) As of the end of 1998, the Named Executive Officers owned the following
number of restricted shares, with the following values (based on the
closing market price per share of CDI Stock on December 31, 1998):
<TABLE>
<CAPTION>
Executive Officer Number of Restricted Shares Value ($)
----------------- --------------------------- ---------
<S> <C> <C>
Mr. Wienick 24,000 534,343
Mr. Mannarino 5,500 111,031
Mr. Sanford 4,860 98,111
Mr. Bohling 3,125 63,086
Mr. Seiders -- --
</TABLE>
The vesting schedules for these restricted shares are described in detail
below under the caption "Employment Agreements".
9
<PAGE>
(2) All Other Compensation consisted of Company contributions and allocations
to employee benefit plans and bonus programs. Company contributions and
allocations were made in 1998 and 1997 to the following employee benefit
plans: the Company's qualified Retirement Plan or a nonqualified
supplemental arrangement to provide comparable benefits (in 1998, $7,145
to the accounts of each of the Named Executive Officers), the Company's
qualified 401(k) plan (in 1998, $400 to the accounts of Messrs. Wienick,
Bohling and Seiders) and the Company's non-qualified excess benefit plan
(in 1998, $46,739 to the account of Mr. Wienick, $12,569 to the account of
Mr. Mannarino, $6,174 to the account of Mr. Sanford, $8,147 to the account
of Mr. Bohling and $4,436 to the account of Mr. Seiders).
In addition, under the Company's Management Stock Purchase Plan ("MSPP"),
the Company makes a matching contribution of one MSPP unit for every three
MSPP units purchased by the participant on a voluntary basis. Under the
MSPP, participants use a portion of their annual bonus awards to purchase
MSPP units, each of which corresponds to a participant's right to receive
one share of CDI Stock upon the satisfaction of the applicable vesting
period. Participants such as the Named Executive Officers who are required
to participate in the MSPP Plan automatically have 25% of their annual
bonus award withheld on a pre-tax basis to purchase MSPP units.
Participants may voluntarily have up to an additional 25% of their annual
bonus award withheld on a pre-tax basis to purchase MSPP units. For 1998,
the first year of the MSPP, the number of units contributed by the Company
to the Named Executive Officers on a matching basis with respect to their
voluntary participation was 185 for Mr. Wienick, 123 for Mr. Mannarino, 96
for Mr. Sanford, 155 for Mr. Bohling and 86 for Mr. Seiders. Based on
$22.5625, which was the closing price per share of CDI Stock on February
24, 1999, the date that the MSPP units were contributed by the Company, the
value of such contributed units was $4,174 for Mr. Wienick, $2,775 for Mr.
Mannarino, $2,166 for Mr. Sanford, $3,497 for Mr. Bohling and $1,940 for
Mr. Seiders.
Option Grants in Last Fiscal Year
The following table sets forth information concerning all grants of stock
options to the Named Executive Officers during 1998. Of the five executive
officers, only Mr. Seiders received stock options during 1998.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term (2)
--------------------------------------------- -----------------------
Percent of
Number of Total
Securities Options Exercise
Underlying Granted to or Base
Options Employees in Price Expiration
Name Granted (#) Fiscal Year ($/Sh)(1) Date 5% ($) 10% ($)
---- ----------- ------------ --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Joseph R. Seiders 1,324 (3) 0.5% 46.50 02/25/08 38,719 98,120
</TABLE>
- --------
(1) All options were granted with exercise prices equal to the closing price
of CDI Stock on the New York Stock Exchange on the last trading day
immediately preceding the date of grant.
10
<PAGE>
(2) The dollar amounts under these calculations are the result of calculations
at the 5% and 10% rates set by the Securities and Exchange Commission and,
therefore, are not intended to forecast possible future appreciation, if
any, of the price of CDI Stock or the present or future value of the
options.
(3) The options granted to Mr. Seiders are not exercisable until they vest. 20%
of the options vest on each of the first five anniversaries of the date of
grant.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values
The following table sets forth information regarding the number of
unexercised stock options and the value of unexercised in-the-money stock
options at the end of 1998 held by the Named Executive Officers. As indicated
by the table, none of the Named Executive Officers exercised any Company stock
options during 1998.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-The-Money Options
Options at FY-End (#) at FY-End ($) *
------------------------- -------------------------
Shares Acquired Value
Name on Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
---- --------------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mitch Wienick 0 0 0 250,000 0 0
Robert J. Mannarino 0 0 12,000 48,000 0 0
John D. Sanford 0 0 10,000 40,000 0 0
Brian J. Bohling 0 0 5,070 6,630 0 0
Joseph R. Seiders 0 0 3,000 1,324 9,938 0
</TABLE>
- --------
* The value of each option share is based on the fair market value of CDI
Stock on December 31, 1998 ( $20.1875 per share) minus the option exercise
price.
Long Term Incentive Plan Awards Table
The following table sets forth information concerning each award under a Long
Term Incentive Plan ("LTIP") made during 1998 to a Named Executive Officer. Of
the five executive officers, only Mr. Seiders received an LTIP award during
1998.
<TABLE>
<CAPTION>
Number of Performance or Other Period
Name Shares Until Maturation or Payoff
---- --------- ----------------------------------------
<S> <C> <C>
Joseph R. Seiders 1,700 * 3-year period ending December 31, 2000 *
</TABLE>
- --------
* Under this LTIP, known as the Performance Shares Plan, there is a
performance goal based on the price of CDI Stock over the three-year period
covering 1998, 1999 and 2000. In order for a participant in the Performance
Shares Plan to receive his target number of shares (1,700 in the case of Mr.
Seiders), the CDI Stock price must outperform the Standard and Poor's 500
Index by two percentage points over the three-year performance period on a
compound annual growth rate. If actual performance during the performance
period exceeds this performance goal by up to an additional two percentage
points, the number of shares of CDI Stock issued to the participant will
increase proportionally by up to an additional fifty percent. If actual
performance during the performance period falls below this performance goal,
participants in the plan will not receive any shares of CDI Stock.
11
<PAGE>
Employment Agreements
The Company has employment agreements with each of the Named Executive
Officers. Following is a summary of the principal terms of those employment
agreements.
Employment Agreement with Mitch Wienick
In March 1997, the Company entered into an Employment Agreement with Mitch
Wienick pursuant to which Mr. Wienick became the Company's President and Chief
Executive Officer beginning in April 1997. The initial term of the agreement
is three years. The agreement currently provides for the following elements of
compensation to Mr. Wienick: (i) a base salary at the rate of $525,000 per
year, with annual increases at the discretion of the Board; (ii) an annual
cash bonus based on the percentage achievement of pre-determined financial and
other goals, with a target bonus of $400,000 (as to the financial goals, the
executive can earn up to 180% of his target bonus for significant
overachievement of the goal, but will receive no bonus if performance falls
below 90% of the goal); (iii) the grant in 1997 of 30,000 restricted shares of
CDI Stock, half of which vest over time (3,000 shares on each of the first
five anniversaries of the date of his Employment Agreement) and half of which
(up to 3,000 shares per year for five years) vest depending on the percentage
achievement of the goals applicable to the cash bonus (shares which do not
vest are forfeited); and (iv) the grant in 1997 of non-qualified stock options
to purchase 250,000 shares of CDI Stock, at an exercise price equal to the
fair market value of the shares on the last trading date immediately preceding
the date of grant ($33.25 per share) and having a maximum term of ten years.
The option shares described in (iv) of the preceding paragraph vest as
follows: 50,000 shares on each of the second, third and fourth anniversaries
of the date of grant and 100,000 shares on the fifth anniversary of the date
of grant. The option shares, as well as the 15,000 shares of restricted stock
that vest based on the passage of time, will vest immediately in the event Mr.
Wienick's employment terminates following a change in control of the Company
if such termination is by the Company without cause or by Mr. Wienick either
because he is assigned duties materially inconsistent with his previous duties
or because his place of employment is moved outside the Philadelphia
metropolitan area. Whenever Mr. Wienick purchases shares upon exercise of his
options, half of the purchased shares may not be sold or transferred until the
second anniversary of the date of exercise; provided, however, that as to the
purchase of 50,000 of the shares which vest on the fifth anniversary of the
date of grant, those shares may not be sold or transferred until the earlier
of (a) one year after the date on which the fair market value of CDI Stock has
been greater than or equal to $90.00 per share for 180 consecutive days, or
(b) the ninth anniversary of the date of the option grant. The restricted
stock described in (iii) above is also subject to a restriction on transfer
such that whenever any of those shares vest, one-half of the shares may not be
sold or transferred until the second anniversary of the vesting date.
Employment Agreement with Robert J. Mannarino
In August 1997, the Company entered into an Employment Agreement with Robert
J. Mannarino pursuant to which Mr. Mannarino became the Company's Executive
Vice President and Chief Operating Officer. The initial term of the agreement
expires on December 31, 1999. The agreement currently provides for the
following elements of compensation to Mr. Mannarino: (i) a base salary at the
rate of $300,000 per year, with annual increases at the discretion of the
Company; (ii) an annual
12
<PAGE>
cash bonus based on the percentage achievement of pre-determined financial and
other goals, with a target bonus of $175,000 (as to the financial goals, the
executive can earn up to 180% of his target bonus for significant
overachievement of the goal, but will receive no bonus if performance falls
below 90% of the goal); (iii) the grant in 1997 of 6,000 restricted shares of
CDI Stock, half of which vest over time (500 shares vested on December 31,
1998, 1,000 shares vest on December 31, 1999, 1,000 shares vest on December
31, 2000, and 500 shares vest on December 31, 2001) and half of which vest
depending on the percentage achievement of the goals applicable to the cash
bonus (up to 500 shares vest based on 1998 performance, up to 1,000 shares
vest based on 1999 performance, up to 1,000 shares vest based on 2000
performance, and up to 500 shares vest based on 2001 performance) (shares
which do not vest are forfeited); and (iv) the grant in 1997 of non-qualified
stock options to purchase 60,000 shares of CDI Stock, at an exercise price
equal to the fair market value of the shares on the last trading date
immediately preceding the date of grant ($38.3125 per share) and having a
maximum term of seven years.
The option shares described in (iv) of the preceding paragraph vest as
follows: 12,000 shares on each of the first five anniversaries of the date of
grant. The option shares, as well as the 3,000 shares of restricted stock that
vest based on the passage of time, will vest immediately in the event Mr.
Mannarino's employment terminates following a change in control of the Company
if such termination is by the Company without cause or by Mr. Mannarino either
because he is assigned duties materially inconsistent with his previous duties
or because his place of employment is moved outside the Philadelphia
metropolitan area. Whenever Mr. Mannarino purchases shares upon exercise of
his options, half of the purchased shares may not be sold or transferred until
the second anniversary of the date of exercise. The restricted stock described
in (iii) above is also subject to a restriction on transfer such that whenever
any of those shares vest, one-half of the shares may not be sold or
transferred until the second anniversary of the vesting date.
Employment Agreement with John D. Sanford
In October 1997, the Company entered into an Employment Agreement with John
D. Sanford pursuant to which Mr. Sanford became the Company's Executive Vice
President and Chief Financial Officer beginning in November 1997. The initial
term of the agreement is three years. The agreement currently provides for the
following elements of compensation to Mr. Sanford: (i) a base salary at the
rate of $270,000 per year during 1998 and $275,000 per year during 1999; (ii)
an annual cash bonus based on the percentage achievement of pre-determined
financial and other goals, with a target bonus of $128,000 (as to the
financial goals, the executive can earn up to 180% of his target bonus for
significant overachievement of the goal, but will receive no bonus if
performance falls below 90% of the goal); (iii) the grant in 1997 of 5,400
restricted shares of CDI Stock, half of which vest over time (540 shares vest
on the first five anniversaries of November 10, 1997) and half of which vest
depending on the percentage achievement of the goals applicable to the cash
bonus (a maximum of 540 shares vest based on the performance in each of 1998,
1999, 2000, 2001 and 2002) (shares which do not vest are forfeited); and (iv)
the grant in 1997 of non-qualified stock options to purchase 50,000 shares of
CDI Stock, at an exercise price equal to the fair market value of the shares
on the last trading date immediately preceding the date of grant ($40.6875 per
share) and having a maximum term of ten years.
13
<PAGE>
The option shares described in (iv) of the preceding paragraph vest as
follows: 10,000 shares on each of the first five anniversaries of the date of
grant. The option shares, as well as the 2,700 shares of restricted stock that
vest based on the passage of time, will vest immediately in the event Mr.
Sanford's employment terminates following a change in control of the Company
if such termination is by the Company without cause or by Mr. Sanford either
because he is assigned duties materially inconsistent with his previous duties
or because his place of employment is moved outside the Philadelphia
metropolitan area. Whenever Mr. Sanford purchases shares upon exercise of his
options, half of the purchased shares may not be sold or transferred until the
second anniversary of the date of exercise. The restricted stock described in
(iii) above is also subject to a restriction on transfer such that whenever
any of those shares vest, one-half of the shares may not be sold or
transferred until the second anniversary of the vesting date.
Employment Agreement with Brian J. Bohling
In July 1997, the Company entered into an Employment Agreement with Brian J.
Bohling pursuant to which Mr. Bohling became the Company's Senior Vice
President, Human Resources. The initial term of the agreement is two years.
The agreement currently provides for the following elements of compensation to
Mr. Bohling: (i) a base salary at the rate of $236,250 per year, with annual
increases at the discretion of the Company; (ii) an annual cash bonus based on
the percentage achievement of pre-determined financial and other goals, with a
target bonus of $94,500 (as to the financial goals, the executive can earn up
to 180% of his target bonus for significant overachievement of the goal, but
will receive no bonus if performance falls below 90% of the goal); (iii) the
grant in 1997 of 3,500 restricted shares of CDI Stock, half of which vest over
time (375 shares vested on December 31, 1998, 875 shares vest on December 31,
1999 and 500 shares vest on December 31, 2000) and half of which vest
depending on the percentage achievement of the goals applicable to the cash
bonus (up to 375 shares vest based on 1998 performance, up to 875 shares vest
based on 1999 performance, and up to 500 shares vest based on 2000
performance) (shares which do not vest are forfeited); and (iv) the grant in
1997 of non-qualified stock options to purchase 11,700 shares of CDI Stock, at
an exercise price equal to the fair market value of the shares on the last
trading date immediately preceding the date of grant ($41.6875 per share) and
having a maximum term of five years.
The option shares described in (iv) of the preceding paragraph vest as
follows: 1,560 shares on December 31, 1997, 3,510 shares on December 31, 1998,
4,030 shares on December 31, 1999, and 2,600 shares on December 31, 2000. The
option shares, as well as the 1,750 shares of restricted stock that vest based
on the passage of time, will vest immediately in the event Mr. Bohling's
employment terminates: (a) following a change in control of the Company, (b)
if such termination is by the Company without cause, or (c) voluntarily by Mr.
Bohling if he is assigned duties materially inconsistent with his previous
duties or if his place of employment is moved outside the Philadelphia
metropolitan area or if Mr. Wienick involuntarily ceases to be the Chief
Executive Officer of the Company. Whenever Mr. Bohling purchases shares upon
exercise of his options, half of the purchased shares may not be sold or
transferred until the second anniversary of the date of exercise. The
restricted stock described in (iii) above is also subject to a restriction on
transfer such that whenever any of those shares vest, one-half of the shares
may not be sold or transferred until the second anniversary of the vesting
date.
14
<PAGE>
Employment Agreement with Joseph R. Seiders
Mr. Seiders' current employment agreement, which was entered into in 1998,
provides for a base salary at the rate of $248,000 per year and states that he
is eligible to receive a cash bonus pursuant to the Company's annual bonus
program for senior managers. Mr. Seiders' 1998 target bonus was set at $62,000
(and he was awarded $23,320). For 1999, Mr. Seiders' base salary has been
increased to $255,440 and his target bonus has been increased to $63,900. The
term of Mr. Seiders' employment continues until terminated by the Company or
him pursuant to his employment agreement.
Report of the Compensation and Stock Option Committee of the Board of
Directors on Executive Compensation
The primary objective of the Company's executive compensation program is to
help the Company in attracting and retaining talented and entrepreneurial
executives through pay programs that reward the achievement of both short-term
and long-term business results. To attain this objective, the Committee
believes that a substantial portion of the compensation paid to the Company's
executives should be at risk and dependent upon the Company's performance. The
Company's executive compensation program reflects this philosophy through the
use of four components: (1) base salary, (2) annual cash bonuses, (3)
restricted stock or performance shares, and (4) stock options.
The Committee's objective is to establish base salaries and annual cash
bonuses for the Company's executives at roughly the median levels paid to
executives with similar responsibilities at comparable companies. For this
purpose, comparisons are made to companies in the same businesses as the
Company (generally the same companies which comprise the peer group in the
"Comparative Stock Performance" section of this Proxy Statement), companies of
comparable size in service businesses and companies of comparable size
regardless of the nature of their business. The Committee retains the services
of an independent outside consultant to help in determining median competitive
compensation levels. Annual bonuses, restricted stock or performance shares,
and stock options each represent variable compensation elements that are at
risk because they are tied to corporate business results. While annual
incentives reward short-term business results and individual performance,
long-term incentives such as restricted stock and stock options recognize
sustained corporate-wide results. When the Company's performance exceeds
targeted levels, these variable pay programs will provide above-average total
compensation (as compared to the levels paid to executives with similar
responsibilities at comparable companies, as described earlier in this
paragraph). When performance falls short of the target, compensation levels
are expected to be below average.
1998 Compensation to the Chief Executive Officer and the other Named
Executive Officers
Of the five Named Executive Officers, four joined the Company during 1997.
Upon joining the Company, each of them was given meaningful grants of stock
options and restricted stock in order to align their compensation with the
interests of shareholders and to provide rewards based on the Company's long-
term performance. In light of these grants in 1997, no additional stock
options or shares of restricted stock were awarded to the four executives
during 1998. The fifth Named Executive Officer, Mr. Seiders, is a long-time
Company officer, and his compensation package during 1998 was consistent with
the compensation program established at the end of 1997 for senior management
employees of the Company. This explains why, during 1998, Mr. Seiders was the
only Named Executive Officer to receive stock options and performance shares.
15
<PAGE>
The base salaries paid in 1998 to the Company's Chief Executive Officer and
the other Named Executive Officers were as provided in their respective
employment agreements, which are described earlier in this Proxy Statement
under the caption "Employment Agreements."
The 1998 cash bonus plan for the Chief Executive Officer was based on the
achievement of pre-determined financial goals. The 1998 financial goals
consisted of achieving targeted levels of revenue growth, operating profit and
earnings per share which were established in the Company's operational plan.
Because the Company's 1998 performance fell below the established financial
objectives, no award was earned by the Chief Executive Officer under his bonus
plan. However, the Committee approved a discretionary award payment to Mr.
Wienick in the amount of $50,000 (10% of his maximum 1998 bonus). This
discretionary award was granted to recognize the achievement of important non-
financial accomplishments in 1998, including strategic actions implemented to
position the Company for improved future financial performance. Among those
strategic actions were restructuring and refocusing the Company's technical
services and information technology services businesses as well as changing
and revitalizing the leadership of a number of the Company's significant
operating units.
Bonuses for the remaining Named Executive Officers were based on both
financial and non-financial goals. The financial goals were not achieved last
year and the non-financial goals were partially achieved. As a result, awards
to the other Named Executive Officers under the bonus plan in 1998 were
substantially below the targeted levels.
Changes to the Annual Bonus Plan for 1999
For 1999, the Committee has approved certain modifications to the annual
bonus plan for the Named Executive Officers and other management employees.
Under the revised plan, 80% of the annual bonus award will be based on
performance against financial objectives, with the remaining 20% based on
performance against non-financial goals. For the Named Executive Officers, the
financial measures are revenue growth, operating profit, earnings per share
against target level, and annual earnings per share growth as measured against
a group of peer companies which are largely the same as, but not identical to,
the list of peer companies identified below in the "Comparative Stock
Performance" section of this Proxy Statement.
In order to encourage and reward superior performance, and to maintain the
competitiveness of the Company's incentive award levels, target bonus amounts
(which would be earned for 100% achievement of the objectives) for the four
Named Executive Officers who joined the Company during 1997 were decreased
from their prior levels, but the maximum possible bonus amounts, which would
be earned for performance which substantially exceeds the goals, were
increased. In addition, under the 1999 bonus plan, the bonuses fall sharply
for performance below the goals, becoming zero for performance below 90% of
the goal. This approach, which represents a change for the four Named
Executive Officers who joined the Company in 1997, conforms their bonus
program with that which applies to other senior management employees
throughout the Company. Details regarding the new bonus amounts for the Named
Executive Officers are set forth above in this Proxy Statement in the
"Employment Agreements" section.
16
<PAGE>
Section 162(m) - The $1 Million Cap on the Deductibility of Executive
Compensation
The Committee has continued to monitor the impact of Section 162(m) of the
Internal Revenue Code, which limits the deductibility by the Company of
certain compensation in excess of $1 million per year that is paid to the
Named Executive Officers. Compensation paid to the Company's executive
officers for fiscal 1998 did not exceed the $1 million limit per covered
officer.
It is the Committee's present intention that executive compensation
arrangements be structured so as to be entirely deductible. The Section 162(m)
regulations provide an exemption for "qualified performance-based
compensation". In recent years, the Board has worked to ensure that the
Company's stock option plans satisfy the requirements for a "performance-
based" stock option plan under the Section 162(m) regulations so that any
compensation to executive officers under those plans (including the stock
options presently held by the Named Executive Officers) would be exempt from
the deductibility limitation. Furthermore, to satisfy the "performance-based"
exemption, certain elements of the Chief Executive Officer's compensation
package were submitted to, and approved by, the shareholders of the Company in
1997.
COMPENSATION AND STOCK OPTION
COMMITTEE:
Walter E. Blankley, Chairman John
M. Coleman Alan B. Miller
Compensation Committee Interlocks and Insider Participation
The Compensation and Stock Option Committee consists of Walter E. Blankley,
John M. Coleman and Alan B. Miller, none of whom is or has been an officer or
employee of the Company or any of its subsidiaries. No executive officer of
the Company served on the compensation committee of another entity (or on any
other committee of the board of directors of another entity performing similar
functions) during 1998.
17
<PAGE>
Comparative Stock Performance
The following graph sets forth the cumulative total shareholder return
(assuming an investment of $100 on December 31, 1993 and the reinvestment of
any dividends) for the last five fiscal years on (a) CDI Stock, (b) the
Standard & Poor's (S&P) 500 Index, and (c) a peer group index. The peer group
selected by the Company consists of the following companies: (i) Alternative
Resources Corp., Butler International Inc., Computer Horizons Corp., Computer
Task Group Inc., Interim Services Inc., Keane Inc., Kelly Services, Inc.,
Manpower Inc., Modis Professional Services, Inc. (formerly, AccuStaff Inc.),
Norrell Corp., Olsten Corporation, Robert Half International Inc. and Volt
Information Sciences, Inc., all of which are in the staffing business; and
(ii) Jacobs Engineering Group, Inc. and Stone & Webster, Inc., both of which
are in the engineering, design and construction business. While the latter two
companies often work on projects significantly larger in size than does the
Company in its engineering and design business and only occasionally compete
directly with the Company, the Company believes that its in-house engineering
businesses and those companies share various important business
characteristics.
[A line graph showing the comparison between the stock performance of CDI
Stock, the peer group and the S&P 500 is in this position in the printed proxy
statement.]
<TABLE>
<CAPTION>
Year Ended December 31
--------------------------------------------------------------------------
1993 1994 1995 1996 1997 1998
---- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
CDI Stock $100 $159.00 $144.00 $227.00 $366.00 $161.50
S&P 500 100 101.32 139.40 171.40 228.59 293.91
Peer Group 100 125.46 165.04 196.79 271.78 229.72
</TABLE>
CERTAIN BUSINESS RELATIONSHIPS
Dechert Price & Rhoads performed legal services for the Company during 1998.
Barton J. Winokur, a director of the Company, is the Chairman and a partner of
Dechert Price & Rhoads.
18
<PAGE>
PROPOSAL TWO
SHAREHOLDER PROPOSAL
Ronald G. Ditmars, Jr. of 777 Berkeley Avenue, Plainfield, New Jersey 07062,
the owner of 50 shares of CDI Stock, has submitted the following proposal for
consideration and action by the shareholders of the Company at the 1999 Annual
Meeting:
"In order to increase shareholder value, it is recommended that the
company should immediately move to sell its temporary help subsidiary,
Todays Staffing, Inc., and that the proceeds of the sale be reinvested in
the company's core business or be distributed to shareholders."
The Board of Directors is strongly opposed to this proposal. The principal
business of Todays Staffing, Inc. ("Todays") is to provide clerical,
secretarial, office support, legal and financial personnel to customers on a
temporary basis. In 1998, Todays had revenues of $209 million, representing
14% of the Company's total revenues, and produced operating profits of $14
million, representing 18% of CDI Corp.'s consolidated operating profits.
During the past five years, revenues from Todays have grown at a compound rate
of 15% per year, and operating profits generated by Todays have grown at a
compound rate of 29% per year.
The Board believes that, in addition to being a major contributor to the
Company's revenues and earnings, Todays is a strategic asset to the Company,
filling an important niche in the broad array of staffing services provided by
the Company's various operating units, and producing valuable cross-selling
and marketing opportunities with the other staffing businesses that are part
of the Company. This is particularly important to a number of CDI's Fortune
100 customers who look to the Company for complete staffing solutions, which
include the provision of clerical, technical and professional personnel. The
Board believes that selling Todays would not be in the best interests of the
Company or its shareholders.
The Board of Directors recommends that you vote "AGAINST" Proposal Two for the
reasons indicated above.
The persons named in the enclosed Proxy (Joseph R. Seiders and Craig H.
Lewis) have advised the Company that they intend to vote AGAINST approval of
Proposal Two unless a contrary choice is specified.
INDEPENDENT AUDITORS
The Company's independent auditors have been KPMG LLP and it is expected
that they will continue in that capacity for the current year. A
representative of KPMG LLP will be present at the meeting and will have the
opportunity to make a statement, if he or she so desires, and to respond to
appropriate questions.
19
<PAGE>
OTHER MATTERS
The Board of Directors knows of no other matters which may come before the
meeting. However, if any such matter should properly come before the meeting,
it is the intention of the persons named in the enclosed Proxy to vote such
proxy in accordance with their best judgment on such matter.
FUTURE SHAREHOLDER PROPOSALS
Shareholders of the Company are entitled to submit proposals for inclusion
in the Company's 2000 Proxy Statement, to be considered for action at the 2000
Annual Meeting of Shareholders. Proposals so submitted must be received by the
Company at its principal executive offices no later than December 7, 1999 and
must comply in all other respects with applicable rules and regulations of the
Securities and Exchange Commission relating to such inclusion. With respect to
a shareholder proposal that is not included in the Company's 2000 Proxy
Statement but which properly comes before the 2000 Annual Meeting of
Shareholders, if the Company does not receive notice of such proposal at its
principal executive offices by February 20, 2000, then the proxy solicited by
the Board for the 2000 Annual Meeting of Shareholders may confer discretionary
authority with respect to such proposal.
By Order of the Board of Directors
/s/ Joseph R. Seiders
JOSEPH R. SEIDERS, Secretary
Dated: April 5, 1999
Philadelphia, Pennsylvania
20
<PAGE>
PROXY
CDI CORP.
1717 ARCH STREET, 35TH FLOOR
PHILADELPHIA, PA 19103-2768
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Joseph R. Seiders and Craig H. Lewis, or
either of them, each with the power to appoint his substitute, and hereby
authorizes them to represent and to vote, as designated on the reverse side, all
the shares of common stock of CDI Corp. held of record by the undersigned on
March 10, 1999, at CDI Corp.'s annual meeting of shareholders to be held on
April 29, 1999, or any adjournments or postponements thereof. The undersigned
acknowledges receipt of the Proxy Statement dated April 5, 1999 and hereby
expressly revokes any and all proxies heretofore given or executed by the
undersigned with respect to the shares of stock represented by this proxy and by
filing this proxy with the Secretary of CDI Corp. gives notice of such
revocation.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ELECTION TO THE BOARD OF DIRECTORS OF ALL NINE NOMINEES LISTED IN
PROPOSAL ONE ON THE REVERSE SIDE HEREOF AND AGAINST PROPOSAL TWO, WHICH IS A
SHAREHOLDER PROPOSAL DESCRIBED IN THE PROXY STATEMENT. WITH RESPECT TO ANY OTHER
MATTERS OF BUSINESS PROPERLY BEFORE THE MEETING, THE SHARES REPRESENTED BY THIS
PROXY WILL BE VOTED AS THE NAMED PROXIES SHALL DECIDE.
(Continued and to be signed on the other side)
/\FOLD AND DETACH HERE/\
[CDI CORP. LOGO]
<PAGE>
===================================================== Please mark =====
your votes as X
indicated in =====
this example
=====================================================
PROPOSAL 1 - ELECTION OF DIRECTORS
The nominees are:
Walter E. Blankley
John M. Coleman
Walter R. Garrison
Kay Hahn Harrell
Lawrence C. Karlson WITHHOLD
Allen M. Levantin FOR FOR ALL
Alan B. Miller [_] [_]
Mitch Wienick
Barton J. Winokur
WITHHOLD VOTE FOR: (Write the name(s) of such nominee(s) in the space provided
below.)
_____________________________________________________
PROPOSAL 2 - A shareholder proposal recommending the sale of the Company's
subsidiary, Todays Staffing, Inc.,as described in the Proxy Statement.
FOR AGAINST ABSTAIN
[_] [_] [_]
3. In their discretion, the named proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournments or
postponements thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 1 AND AGAINST PROPOSAL 2.
Signature ________________ Signature ________________ Dated ________________
NOTE: Please sign exactly as name appears hereon. Joint owners should each
sign. When signing as attorney, executor, administrator, trustee or guardian,
corporate officer or partner, please give full title as such.
/\FOLD AND DETACH HERE/\
CDI
CORP.
[logo]
YOUR VOTE IS IMPORTANT TO US. PLEASE COMPLETE,
DATE AND SIGN THE ABOVE PROXY CARD AND RETURN IT
PROMPTLY IN THE ACCOMPANYING ENVELOPE.
