<PAGE>
SCHEDULE 14A
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 (S) 240.14a-11(c) or (S) 240.14a-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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
-------------------------------------------------------------------------
Notes:
<PAGE>
[CDI Corp. logo appears here]
1717 Arch Street, 35th Floor
Philadelphia, Pennsylvania 19103-2768
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
May 3, 2000
To all Shareholders:
The Annual Meeting of the Shareholders of CDI Corp. (the "Company") will be
held in the Trumbauer West Room on the 51st Floor of the Bell Atlantic Tower,
1717 Arch Street, Philadelphia, Pennsylvania 19103, on Wednesday, May 3, 2000
at 9:30 a.m., for the following purposes:
1. To elect ten directors of the Company to serve during the ensuing year
or until their successors have been duly elected and qualified; and
2. 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 14, 2000 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 your shares 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.
Most shareholders can also vote their shares over the Internet or by
telephone. 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 11, 2000
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 MAY 3, 2000
-----------------------------------------------
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"), a corporation organized under the laws of the
Commonwealth of Pennsylvania, to be used at the Annual Meeting of Shareholders
to be held on Wednesday, May 3, 2000, at 9:30 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 11, 2000.
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 revocation to the Secretary of the Company
at any time prior to the vote. 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. The
shares represented by the Proxy will be voted for the election of all of the
directors unless authority to do so is withheld.
ANNUAL REPORT
The Company's Annual Report to Shareholders for the year ended December 31,
1999 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 14, 2000,
19,071,812 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. 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) 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 14, 2000
will be entitled to vote at the meeting.
PRINCIPAL SHAREHOLDERS AND MANAGEMENT STOCK OWNERSHIP
As of February 15, 2000, the following persons and entities were known by
the Company to be beneficial owners of 5% or more 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, 5,672,488 (1) 29.2%
Lawrence C. Karlson,
Barton J. Winokur and
Paul H. Woodruff 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 1,700,980 (2) 8.8%
800 Manchester Avenue,
3rd Floor
Media, PA 19063
Lazard Freres & Co. LLC 963,300 (3) 5.0%
30 Rockefeller Plaza
New York, NY 10020
</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
<PAGE>
(2) Includes 77,331 shares held indirectly. 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 (5) and (7) to the following table.
(3) This number is as of December 31, 1999, based on a Schedule 13G filed by
the shareholder with the U.S. Securities and Exchange Commission.
The following table sets forth, as to each person who is a director,
director nominee or executive officer named in the Summary Compensation Table
which appears later in this Proxy Statement, 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 15, 2000 and the percentage of the
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 15,473 (1) Less than .1%
Brian J. Bohling 15,870 (2) Less than .1%
John M. Coleman 13,398 (3) Less than .1%
Gregory L. Cowan 5,000 (4) Less than .1%
Michael J. Emmi 0 0%
Walter R. Garrison 1,700,980 (5)(6)(7) 8.8%
Kay Hahn Harrell 4,298 (8) Less than .1%
Lawrence C. Karlson 49,498 (1)(6) .3%
Edgar D. Landis 310,000 1.6%
Allen M. Levantin 34,473 (9) .2%
Robert J. Mannarino 37,506 (10) .2%
Alan B. Miller 16,473 (1) Less than .1%
Joseph R. Seiders 14,829 (11) Less than .1%
Mitch Wienick 143,769 (12) .7%
Barton J. Winokur 204,717 (6)(7)(13) 1.1%
All directors, director nominees and
executive officers as a group (15
persons) 2,566,284 (14) 13.2%
</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 14,473 shares which Messrs. Blankley, Karlson and Miller each
presently has the right to acquire through the exercise of options.
(2) Includes 1,875 shares of restricted stock which are subject to vesting and
10,940 shares which Mr. Bohling 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
"Agreements with Brian J. Bohling".
(3) Includes 1,000 shares owned indirectly and 2,298 shares which Mr. Coleman
presently has the right to acquire through the exercise of options.
3
<PAGE>
(4) Consists of 5,000 shares of restricted stock which are subject to vesting.
For more information regarding the vesting terms of the restricted stock,
see footnote (1) to the Summary Compensation Table below.
(5) Includes 77,331 shares held indirectly. 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.
(6) 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.
(7) 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 three 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.
(8) Includes 2,298 shares which Ms. Harrell presently has the right to acquire
through the exercise of options.
(9) Includes 24,473 shares which Mr. Levantin presently has the right to
acquire through the exercise of options.
(10) Includes 764 shares owned indirectly, 4,000 shares of restricted stock
which are subject to vesting and 26,800 shares which Mr. Mannarino has
the right to acquire through the exercise of options. However, the 4,000
shares of restricted stock were forfeited when Mr. Mannarino's employment
ended on March 31, 2000.
(11) Includes 1,329 shares which Mr. Seiders has the right to acquire through
the exercise of options.
(12) Includes 3,000 shares owned indirectly, 18,000 shares of restricted stock
which are subject to vesting and 100,000 shares which Mr. Wienick 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 "Agreements with Mitch Wienick".
(13) 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.
(14) If the 5,672,488 shares held in the Garrison family trusts referred to in
footnote (6) 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 2,566,284 shares shown in the table as held by
directors, director nominees and executive officers as a group, the total
would be 8,445,772 shares or 43.4% of the outstanding CDI Stock.
4
<PAGE>
ELECTION OF DIRECTORS
Ten 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 ten 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.
Information About the Nominees
The following table sets forth information about the nominees for election
to the Board of Directors.
<TABLE>
<CAPTION>
Principal Present Position,
Business Experience
Name and Committee Director of During Past Five Years and
Membership Age Company Since** Other Directorships
------------------ --- --------------- ---------------------------
<C> <C> <C> <S>
Walter E. Blankley (C)(G) 64 1994 Chairman of the Board
(since 1993) and Chief
Executive Officer (1990-
1999) of AMETEK, Inc.,
Paoli, PA (manufacturer of
air moving electric motors
and precision electronic
instruments); Director of
Amcast Industrial
Corporation
John M. Coleman (C) 50 1998 Chairman and Chief
Executive Officer of
Cambridge Capital Partners
LLP (early-stage investment
firm); 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 (1990-
1997)
Michael J. Emmi (A)(F) 57 1999 Chairman and Chief
Executive Officer of
Systems & Computer
Technology Corporation,
Malvern, PA since 1985;
Director of Safeguard
Scientifics, Inc. and
CompuCom Systems, Inc.
Walter R. Garrison (E)(G) 73 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 (A) 59 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 (F)(G) 57 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.
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
Principal Present
Position, Business
Experience
Name and Committee Director of During Past Five Years and
Membership Age Company Since** Other Directorships
------------------ --- --------------- --------------------------
<C> <C> <C> <S>
Allen M. Levantin (A) 67 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 (C) 62 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 (E)(F)(G) 51 1997 President and Chief
Executive Officer of the
Company since April 1997;
President-Consumer
Services, Ameritech
Corporation (1995-March
1997)
Barton J. Winokur (A)(E)(F) 60 1968 Chairman and Partner in
the law firm of Dechert
Price & Rhoads,
Philadelphia, PA; Director
of AmeriSource Health
Corporation
</TABLE>
- --------
(A) Member of the Audit Committee
(C) Member of the Compensation Committee
(E) Member of the Executive Committee
(F) Member of the Finance Committee
(G) 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 1999, and
acted on one other occasion by unanimous written consent. The Board of
Directors has five standing committees: an Audit Committee, a Compensation
Committee, an Executive Committee, a Finance Committee and a Governance
Committee.
The Audit Committee reviews (a) the financial reports and other financial
information provided by the Company to shareholders, the Securities and
Exchange Commission and others, (b) the audit efforts of the Company's
independent accountants, (c) the Company's systems of internal control
regarding finance, accounting, legal compliance and business conduct, and (d)
the Company's auditing, accounting and financial processes generally. This
Committee held five meetings during 1999.
The Compensation Committee reviews and approves, or recommends to the Board
for approval, the compensation and benefit programs and policies for the
Company's executive management group. This Committee held six meetings during
1999.
6
<PAGE>
The Executive Committee exercises all the powers of the Board, subject to
certain limitations, when the Board is not in session and is unable to meet or
it is impractical for the Board to meet. This Committee held four meetings
during 1999, and acted on two other occasions by unanimous written consent.
The Finance Committee oversees the financial affairs and policies of the
Company, including review of the Company's annual operating and capital plans
and major acquisitions or dispositions. This Committee held nine meetings
during 1999.
The Governance Committee oversees matters relating to Board organization,
composition, compensation, regulatory compliance and effectiveness
evaluations. The Committee also reviews executive succession planning and
executive recruitment processes. 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 1999.
Corporate Governance
The Board of Directors has taken a number of progressive steps in the areas
of corporate governance.
Each of the Board's committees has undertaken the development of written
guidelines setting forth the committee's purpose, composition,
responsibilities and duties. The Governance Committee has undertaken the
development of overall guidelines for board governance which provide, among
other things, processes for the selection of new director candidates and for
the periodic evaluations of Board and Chief Executive Officer performance.
The Board of Directors intends to continue its focus on, and development of,
corporate governance processes.
Compensation of Directors
The Board of Directors has approved a modified compensation package for
directors, which will become effective after this year's Annual Meeting. Under
both the old and the new arrangements, fees are payable only to directors who
are not employees of the Company or one of its subsidiaries.
Under the old arrangement, which was in effect during 1999 and will continue
until this year's Annual Meeting, each non-employee director receives 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. The number of options is determined using a
Black-Scholes valuation. However, any director
7
<PAGE>
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.
Under the new arrangement, each non-employee director will receive a
retainer fee of $50,000 per year as compensation for the director's service on
the Board. For service on committees of the Board, non-employee directors will
receive an additional $5,000 for each committee chaired and $3,000 for each
committee served on in excess of one. Also, non-employee directors will be
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.
With respect to the $50,000 retainer fee, directors can elect to be paid in
cash or in any combination of (1) cash, (2) Company stock options, or (3)
Company stock through a deferred stock purchase plan. The number of options
would be determined using a Black-Scholes valuation at the time of grant. In
connection with the new compensation arrangement for directors, a stock
ownership requirement has been established. By the end of 2002, all directors
of the Company must own at least $100,000 of CDI Stock.
In April 1997, in connection with the retirement of Walter R. 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. The Consulting Agreement provides that Mr. Garrison will
receive no additional compensation for his service as a director of the
Company. During 1999, Mr. Garrison earned consulting fees of $450,000.
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. Below are the Company's
executive officers at the end of 1999, along with their business experience
over the past five years:
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 42, was the Company's Executive Vice President
and Chief Operating Officer from August 1997 until March 31, 2000. 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).
8
<PAGE>
Gregory L. Cowan, age 46, was elected the Company's Executive Vice
President and Chief Financial Officer in October 1999. He joined the
Company in May 1999 as Vice President and Controller. Prior to joining the
Company, he was Vice President-Internal Audit of Crown Cork and Seal
Company Inc. Prior to his election as Vice President of Crown Cork and Seal
Company Inc. in 1996, he was that company's Director of Internal Audit.
Brian J. Bohling, age 39, 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.
Joseph R. Seiders, age 51, has been the Company's Senior Vice President
and General Counsel since 1987.
9
<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 serving as an
executive officer of the Company at the end of 1999, as well as one additional
person who served as an executive officer during a portion of 1999. The six
executives who are included in this Summary Compensation Table are referred to
in this Proxy Statement as the "Named Executive Officers". Messrs. Wienick and
Mannarino joined the Company during 1997, so the information provided for them
for 1997 reflects a partial year. Mr. Bohling and Mr. Seiders first became
executive officers of the Company in early 1998, so no information is provided
for them for 1997. Mr. Cowan joined the Company during 1999, so the
information provided for him for 1999 reflects a partial year and no
information is provided for 1998 or 1997. Mr. Landis retired as Chief
Financial Officer at the end of 1997 and returned as Acting Chief Financial
Officer during a portion of 1999, until Mr. Cowan was elected as the Chief
Financial Officer.
<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(#) ($)(2)
------------------ ---- ---------- --------- ---------------- ----------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Mitch Wienick, 1999 525,000 322,162 0 0 54,925
President and 1998 500,000 50,000 0 0 58,458
Chief Executive Officer 1997 365,393 303,314 1,061,250 250,000 17,853
(beginning in April
1997)
Robert J. Mannarino, 1999 300,000 129,431 0 14,000 26,347
Executive Vice
President 1998 275,000 33,300 0 0 22,489
and Chief Operating 1997 105,776 136,105 231,000 60,000 4,514
Officer (August 1997
through March 31,
2000)
Gregory L. Cowan, 1999 126,613 39,638 130,000 38,115 884
Executive Vice
President 1998 -- -- -- -- --
and Chief Financial 1997 -- -- -- -- --
Officer (elected in
October 1999;
employment began in
May 1999)
Brian J. Bohling, 1999 236,250 81,782 0 9,200 13,311
Senior Vice President, 1998 225,000 41,850 0 0 19,189
Human Resources 1997 -- -- -- -- --
Joseph R. Seiders, 1999 255,440 53,987 0 4,000 17,881
Senior Vice President 1998 248,000 23,320 0 1,324 13,921
and General Counsel 1997 -- -- -- -- --
Edgar D. Landis, 1999 259,422(3) 0 0 0 100,000(3)
Acting Chief Financial 1998 -- -- -- -- --
Officer (May 1999 to 1997 248,108 200,000 0 0 20,027
October 1999)
</TABLE>
- --------
(1) As of the end of 1999, the Named Executive Officers owned the following
number of restricted shares, with the following values (based on the
closing market price per share of CDI Stock on December 31, 1999):
10
<PAGE>
<TABLE>
<CAPTION>
Executive Officer Number of Restricted Shares Value ($)
----------------- --------------------------- ---------
<S> <C> <C>
Mr. Wienick 18,000 434,250
Mr. Mannarino 4,000 96,500
Mr. Cowan 5,000 120,625
Mr. Bohling 1,875 45,234
Mr. Seiders -- --
Mr. Landis -- --
</TABLE>
The vesting schedules for the restricted shares owned by Mr. Wienick and Mr.
Bohling are described below under the caption "Certain Employment and other
Agreements with the Named Executive Officers". With respect to the
restricted shares owned by Mr. Cowan, half vest over time (500 shares vest
on October 25th of each year from 2000 through 2004) and half vest depending
on the percentage achievement of the goals applicable to his cash bonus
arrangement (up to 500 shares vest based on performance during each of 2000
through 2004). Restricted shares which do not vest are forfeited. With
respect to the restricted shares owned by Mr. Mannarino at the end of 1999,
735 shares have since become vested based on 1999 performance and the
balance were forfeited on March 31, 2000 when Mr. Mannarino's employment
with the Company ended.
(2) Except as described in footnote (3) below, All Other Compensation
consisted of Company contributions and allocations to employee benefit
plans and bonus programs. Company contributions and allocations were made
in 1999, 1998 and 1997 to the following employee benefit plans (or to
nonqualified supplemental arrangements to provide comparable benefits):
the Company's qualified Retirement Plan (in 1999, $7,093 to the accounts
of each of the Named Executive Officers except for Mr. Cowan, who was not
yet eligible to participate, and for Mr. Landis), the Company's qualified
401(k) plan (in 1999, $400 to the accounts of Messrs. Wienick, Bohling and
Seiders) and the Company's non-qualified excess benefit plan (in 1999,
$20,587 to the account of Mr. Wienick, $8,473 to the account of Mr.
Mannarino, $5,818 to the account of Mr. Bohling and $5,881 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 1999, the number of
units contributed by the Company to the Named Executive Officers on a
matching basis with respect to their voluntary participation was 1,245 for
Mr. Wienick, 500 for Mr. Mannarino, 41 for Mr. Cowan, 209 for Mr. Seiders
and 0 for Mr. Bohling and Mr. Landis. Based on $21.5625 per share, which was
the closing price of CDI Stock on February 24, 2000, the date that the MSPP
units were contributed by the Company, the value of such contributed units
was $26,845 for Mr. Wienick, $10,781 for Mr. Mannarino, $884 for Mr. Cowan,
$4,507 for Mr. Seiders and $0 for Mr. Bohling and Mr. Landis. Mr. Mannarino
forfeited the Company's matching contribution of MSPP units when his
employment ended on March 31, 2000.
11
<PAGE>
(3) Mr. Landis' compensation for services rendered to the Company during 1999
consisted entirely of consulting fees, which were a fixed amount of
$15,000 during the first quarter of the year and a rate of $2,350 per day
for each day he worked for the Company during the remainder of the year.
In addition, Mr. Landis received $100,000 during 1999 for a noncompetition
agreement he signed when he retired as an employee of the Company at the
end of 1997. For additional information about that noncompetition
agreement, see below under "Agreements with Edgar D. Landis".
Option Grants in Last Fiscal Year
The following table sets forth information concerning all grants of stock
options to the Named Executive Officers during 1999.
<TABLE>
<CAPTION>
Potential
Realizable Value
at Assumed Annual
Rates of Stock
Price
Appreciation for
Individual Grants Option Term (2)
---------------------------------------------- -----------------
Percent of
Number of Total
Securities Options Exercise
Underlying Granted to or Base
Options Employees in Price Expiration
Name Granted (#) Fiscal Year ($/Sh)(1) Date 5% ($) 10% ($)
---- ---------- ------------ --------- ---------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Mannarino 14,000 (3) 2.6% 22.5625 2/25/09 198,652 503,423
Gregory L. Cowan 3,115 (3) 0.6% 31.9375 5/11/09 62,566 158,554
Gregory L. Cowan 35,000 (3) 6.5% 26.0000 10/26/09 572,294 1,450,306
Brian J. Bohling 9,200 (3) 1.7% 22.5625 2/25/09 130,543 330,821
Joseph R. Seiders 4,000 (3) 0.7% 22.5625 2/25/09 56,758 143,835
</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.
(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 the Named Executive Officers during 1999 are not
exercisable until they vest. 20% of the options vest on each of the first
five anniversaries of the date of grant.
12
<PAGE>
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values
The following table sets forth information regarding stock options exercised
by the Named Executive Officers during 1999 as well as the number of
unexercised stock options and the value of unexercised in-the-money stock
options at the end of 1999 held by the Named Executive Officers. As indicated
by the table, of the Named Executive Officers, only Mr. Seiders exercised any
Company stock options during 1999. Mr. Landis, the Acting Chief Financial
Officer during a portion of the year, did not own stock options at any time
during 1999.
<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 -- -- 50,000 200,000 0 0
Robert J. Mannarino -- -- 24,000 50,000 0 21,875
Gregory L. Cowan -- -- 0 38,115 0 0
Brian J. Bohling -- -- 9,100 11,800 0 14,375
Joseph R. Seiders 3,000 22,688 264 5,060 0 6,250
</TABLE>
- --------
* The value of each option share is based on the market value of CDI Stock on
December 31, 1999 ($24.125 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 1999 to a Named Executive
Officer. Of the six Named Executive Officers, only Mr. Mannarino and Mr.
Bohling received an LTIP award during 1999.
<TABLE>
<CAPTION>
Number of Performance or Other Period
Name Shares Until Maturation or Payoff
---- --------- ---------------------------------------------
<S> <C> <C>
Robert J. Mannarino 3,000 (1)(2) February 24, 1999 to December 31, 2000 (1)(2)
Brian J. Bohling 2,350 (1) February 24, 1999 to December 31, 2000 (1)
</TABLE>
- --------
(1) Under this LTIP, known as the Performance Shares Plan, there is a
performance goal based on the price of CDI Stock over the period beginning
on the date of the award (February 24, 1999) and ending on December 31,
2000. In order for a participant in the Performance Shares Plan to receive
his target number of shares (3,000 in the case of Mr. Mannarino and 2,350
in the case of Mr. Bohling), the compound annual growth rate of the CDI
Stock price must outperform the Standard and Poor's 500 Index by two
percentage points over the performance period. 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.
(2) Because Mr. Mannarino's employment ended on March 31, 2000, prior to the
conclusion of the performance period, this award has terminated.
13
<PAGE>
Certain Employment and other Agreements with the Named Executive Officers
Following is a summary of the principal terms of employment agreements
between the Company and certain of the Named Executive Officers, as well as
compensatory arrangements with certain of the Named Executive Officers
involving possible payments in excess of $100,000 in the event of the
resignation, retirement or other termination of such officers' employment with
the Company or a change of control of the Company.
Under severance guidelines which were adopted by the Compensation Committee
in 1999, the Named Executive Officers would be entitled to receive an amount
equal to twelve months' base salary upon termination of employment unless they
resign or are terminated for cause. In addition, the executive would have up
to twelve months following termination of employment in which to exercise any
stock options which had vested prior to termination of employment. In return
for the payments, the executive must agree to noncompetition and other
restrictive covenants in favor of the Company and must release the Company
from various claims. If, however, the executive would be entitled to severance
benefits under his or her employment agreement that are greater than those
contained in the guidelines, the agreement provisions would govern.
Agreements 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 that agreement
is three years, which expires on April 7, 2000. An ad hoc committee of the
Board and Mr. Wienick are currently discussing the contract terms.
At the time he entered into his original Employment Agreement, Mr. Wienick
was granted: (a) 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 his cash bonus arrangement (shares which do not vest are
forfeited); and (b) 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 day immediately preceding the date of grant ($33.25 per
share) and having a maximum term of ten years. The option shares described in
(b) of the preceding sentence 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 will vest
immediately in the event Mr. Wienick's employment terminates following a
change of control of the Company if such termination is (i) by the Company
without cause or (ii) by Mr. Wienick if he is assigned duties materially
inconsistent with his previous duties or if his place of employment is moved
outside the Philadelphia metropolitan area. The shares of restricted stock
that vest based on the passage of time will continue to vest over a period of
one year in the event Mr. Wienick's employment is terminated (i) by the
Company without cause or (ii) by Mr. Wienick, after a change of control of the
Company, if he is assigned duties materially inconsistent with his previous
duties or if his place of employment is moved outside the Philadelphia
metropolitan area.
Agreements with Robert J. Mannarino
Robert J. Mannarino's employment with the Company ended on March 31, 2000.
Mr. Mannarino and the Company have entered into an agreement effective
April 1, 2000, pursuant to which
14
<PAGE>
Mr. Mannarino will receive twelve monthly payments of $25,000 as severance and
in return for his noncompetition covenants and release of claims in favor of
the Company. In addition, Mr. Mannarino agreed to render consulting services
over the twelve-month period beginning in April 2000, for which he will be
paid $2,000 per month.
Agreements 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. That agreement had an initial term of two years,
and has been renewed for an additional year. At the time he entered into his
Employment Agreement, Mr. Bohling was granted: (a) 3,500 restricted shares of
CDI Stock, half of which vest over time (375 shares vested on December 31,
1998, 875 shares vested 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 his cash bonus arrangement (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 (b) 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 (b) of the preceding sentence 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
will vest immediately (i) if Mr. Bohling's employment is terminated by the
Company without cause after a change of control or (ii) if Mr. Bohling
voluntarily terminates his employment after a change in control of the
Company, after being assigned duties materially inconsistent with his previous
duties, after his place of employment is moved outside the Philadelphia
metropolitan area or after Mr. Wienick ceased to be the Chief Executive
Officer of the Company. The shares of restricted stock that vest based on the
passage of time will vest immediately (i) if Mr. Bohling's employment is
terminated by the Company without cause or (ii) if Mr. Bohling voluntarily
terminates his employment after a change of control of the Company, after
being assigned duties materially inconsistent with his previous duties, after
his place of employment is moved outside the Philadelphia metropolitan area or
after Mr. Wienick ceased to be the Chief Executive Officer of the Company.
Agreements with Edgar D. Landis
In December 1997, in connection with the retirement of Mr. Landis as an
officer and employee of the Company, the Company and Mr. Landis entered into
an agreement which contained certain covenants restricting Mr. Landis from
competing with the Company and from soliciting the Company's customers or
management employees for a period of five years (through December 31, 2002).
In consideration for those restrictive covenants, the Company agreed to pay
Mr. Landis $100,000 per year during the five-year term of the covenants. Mr.
Landis received $100,000 in 1999 under that agreement.
Mr. Landis was retained by the Company as a consultant during 1999. For the
first quarter of the year, he was paid a fixed consulting fee of $15,000. In
May 1999, following the departure of the Company's former Chief Financial
Officer, the Company asked Mr. Landis to serve as Acting Chief
15
<PAGE>
Financial Officer until a new Chief Financial Officer was elected. Mr. Landis'
role as Acting Chief Financial Officer ended on October 25, 1999, when Gregory
L. Cowan was elected as the Company's Executive Vice President and Chief
Financial Officer. During the second, third and fourth quarters of 1999, Mr.
Landis was paid consulting fees at the rate of $2,350 per day for each day he
worked for the Company.
Report of the Compensation Committee of the
Board of Directors on Executive Compensation
Principal Objectives
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 and/or performance shares, and (4) stock options. For a
description of the Company's existing performance shares plan, see footnote 1
to the "Long-Term Incentive Plan Awards Table" which appears earlier in this
Proxy Statement.
The Committee's objective is to establish base salaries and annual cash
bonus opportunities 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 opportunities. Annual bonuses, restricted stock or performance
shares, and stock options each represent variable compensation elements that
are at risk because they are tied to business results. While annual incentives
reward short-term business results and individual performance, long-term
incentives such as restricted stock, performance shares and stock options
recognize sustained corporate-wide results. When the Company's performance
exceeds targeted levels, these variable pay programs are intended to 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 targets, compensation
levels are expected to be below average.
Annual Compensation to the Named Executive Officers in 1999
The four Named Executive Officers who had been with the Company in 1998
(Mitch Wienick, Robert J. Mannarino, Brian J. Bohling and Joseph R. Seiders)
received single-digit percentage increases in their base salaries for 1999, in
order for the salaries to remain competitive with the benchmarks described
above. The increased salaries for 1999 are reflected in the Summary
Compensation Table which appears earlier in this Proxy Statement.
16
<PAGE>
Under the bonus program applicable during 1999 to each of the Named
Executive Officers (except for Edgar D. Landis, who served as Acting Chief
Financial Officer in an interim consulting capacity), 80% of the target bonus
opportunity was based on performance against quantitative financial goals, and
the remaining 20% was based on performance against qualitative non-financial
goals. The financial goals for 1999, which were the same for each of the
participating Named Executive Officers, were based on the achievement of
targeted levels of Company revenue, operating profit and earnings per share,
as well as the Company's earnings per share growth as measured against a group
of peer companies which were largely the same as the list of peer companies
identified below in the "Comparative Stock Performance" section of this Proxy
Statement. Each of the four quantitative financial goals received equal
weight, representing 20% of the total bonus opportunity. The qualitative non-
financial goals, representing the remaining 20% of the executives' bonus
opportunity, were individualized for each participating Named Executive
Officer. The bonus program was designed so that bonus awards relating to the
financial goals would fall sharply for performance below the goals, becoming
zero for performance below 90% of the goals. In order to encourage and reward
superior performance and to maintain the competitiveness of the Company's
incentive award levels, the bonus program was designed so that the executive
could earn a maximum possible bonus of 180% of his target amount relating to
the financial goals, which would be attained for performance substantially
exceeding the financial goals.
During 1999, the following percentages of the financial goals were achieved
by the Company, resulting in the payment of the following percentages of the
target bonuses applicable to those goals:
<TABLE>
<CAPTION>
Financial Goal % of Goal Achieved % of Target Bonus Paid
-------------- ------------------ ----------------------
<S> <C> <C>
Revenue 94.40% 77.60%
Operating Profit 98.16% 92.65%
Earnings Per Share (EPS) 98.11% 92.45%
EPS Growth N/A * 80.00%
</TABLE>
- --------
* Performance against this goal was measured based on the quartile in which
the Company's EPS growth placed as compared to the companies in the peer
group. For 1999, the Company placed in the second quartile.
With respect to the individual qualitative goals for 1999, the Compensation
Committee and the Chief Executive Officer reviewed the goals and achievements
of the Named Executive Officers (other than Mr. Wienick) and determined the
applicable percentage of the target bonus earned. Overall, taking into account
both the quantitative and qualitative goals, these executives achieved the
following percentages of their target bonuses in 1999: 73.5% by Mr. Mannarino,
81.0% by Mr. Cowan, 86.5% by Mr. Bohling and 84.5% by Mr. Seiders.
Mr. Wienick's overall performance as Chief Executive Officer was evaluated
by the Board of Directors in 1999 using a structured process that consisted of
several stages. First, a questionnaire was developed to solicit the Board's
assessment of Mr. Wienick's performance in the following areas: leadership,
strategic planning, financial results, management of operations, management
development/succession, human resources, communication and board relations.
Each director then completed the questionnaire, providing both a numeric and
narrative assessment of Mr. Wienick's performance in each area. The Chairs of
the Board's Governance and Compensation Committees then
17
<PAGE>
synthesized the questionnaire responses into a draft performance report which
was reviewed, amended and ultimately approved by the Board. The two committee
chairs then met with Mr. Wienick to deliver the report and respond to
questions. Finally, Mr. Wienick responded both in writing and orally to the
Board regarding the report. In conjunction with the above evaluation, Mr.
Wienick's achievement of his individual qualitative goals for 1999 was also
assessed by the Board. He was determined to have achieved 60% of those goals.
Mr. Wienick achieved 80.5% of his overall target bonus.
Mr. Landis was retained by the Company to serve as Acting Chief Financial
Officer from May 1999 (following the departure of the Company's previous Chief
Financial Officer) until October 1999 (when a new Chief Financial Officer was
elected). During that period, Mr. Landis was paid $2,350 per day for his
services, a rate which the Company believes was competitive in the marketplace
for Chief Financial Officers of public companies of a similar size to the
Company and for someone with Mr. Landis' substantial experience. Mr. Landis
had been the Chief Financial Officer of the Company from 1973 until his
retirement in 1997. Given the interim nature of Mr. Landis' assignment, his
compensation during this period was limited to a fixed daily rate. In
addition, during the first quarter of 1999, Mr. Landis was paid a fixed amount
of $15,000 for other consulting services rendered to the Company during that
quarter.
Long Term Compensation to the Named Executive Officers in 1999
Each of the Named Executive Officers, except for Mr. Wienick and Mr. Landis,
was granted stock options during 1999. Mr. Mannarino, Mr. Bohling and Mr.
Seiders received options in February 1999 as part of the Company's overall
compensation program for senior management. Mr. Cowan was given special grants
of options when he joined the Company in May 1999 and when he was promoted to
Chief Financial Officer in October 1999. In February 1999, Mr. Mannarino and
Mr. Bohling also received units in the Company's Performance Shares Plan
(PSP), as described earlier in this Proxy Statement in the Long Term Incentive
Plan Awards Table. These stock option grants and PSP awards were made in order
to continue to align the executives' compensation with the interests of
shareholders, to provide rewards which are contingent upon the Company's long-
term performance and to achieve and maintain competitive levels of
compensation. Mr. Wienick was not granted options or PSP units in 1999 because
the stock options granted to him in 1997 when he joined the Company as its
Chief Executive Officer were regarded by the Committee as sufficient to align
his compensation with shareholder interests and to provide adequate long-term
performance incentives. Mr. Landis was not granted stock options or PSP units
in 1999 because of the short-term nature of his role as an interim Chief
Financial Officer.
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 1999 did not exceed the $1 million limit per covered officer.
It has been the Committee's policy thus far to structure executive
compensation arrangements so as to be entirely deductible. The Section 162(m)
regulations provide an exemption for "qualified
18
<PAGE>
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 COMMITTEE:
John M. Coleman, Chairman
Walter E. Blankley
Alan B. Miller
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of John M. Coleman, Walter E. Blankley
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
1999.
Comparative Stock Performance
The following graph sets forth the cumulative total shareholder return
(assuming an investment of $100 on December 31, 1994 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, (c) the peer group index used in the
Company's proxy statement last year (the "Old Peer Group"), and (d) a new peer
group index (the "New Peer Group").
The Old Peer Group consists of the following 14 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., Olsten Corporation, Robert
Half International Inc. and Volt Information Sciences, Inc., all of which are
in the staffing and outsourcing business; and (ii) Jacobs Engineering Group,
Inc. and Stone & Webster, Inc., both of which are in the engineering, design
and construction business.
The New Peer Group selected by the Company consists of the following 17
companies: (i) Alternative Resources Corp., Butler International Inc., CIBER,
Inc., Computer Horizons Corp., Computer Task Group Inc., Heidrick & Struggles
International, Inc., Interim Services Inc., Keane Inc., Kelly Services, Inc.,
Korn/Ferry International, Manpower Inc., Modis Professional Services, Inc.,
Olsten Corporation, Robert Half International Inc. and Volt Information
Sciences, Inc., all of which are in the staffing and outsourcing business; and
(ii) Jacobs Engineering Group, Inc. and Stone & Webster, Inc., both of which
are in the engineering, design and construction business.
19
<PAGE>
The changes from the Old Peer Group to the New Peer Group are as follows:
(a) CIBER was added in recognition of the increasing significance of
information technology services within the Company, and (b) Heidrick &
Struggles International and Korn/Ferry International, both of which became
public companies during 1999, were added to better reflect the employee search
and recruitment business within the Company, represented principally by the
Company's Management Recruiters International, Inc. subsidiary. Both the Old
Peer Group and the New Peer Group reflect the elimination of Norrell Corp.
because Norrell was acquired by Interim Services during 1999 and is no longer
publicly traded. With regard to the engineering companies included in both the
Old Peer Group and the New Peer Group, the Company notes that while those
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
CORP., THE NEW PEER GROUP, THE OLD PEER GROUP AND THE S&P 500 IS IN THIS
POSITION IN THE PRINTED PROXY STATEMENT."
<TABLE>
<CAPTION>
Year Ended December 31
---------------------------------------------------------------
1994 1995 1996 1997 1998 1999
---- ------ ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
CDI Corp. $100 $90.57 $142.77 $230.19 $101.58 $121.38
S&P 500 100 137.58 169.17 225.60 290.08 351.12
Old Peer Group 100 130.87 153.23 216.35 183.44 162.10
New Peer Group 100 131.65 157.40 225.52 192.80 188.64
</TABLE>
CERTAIN BUSINESS RELATIONSHIPS
Dechert Price & Rhoads performed legal services for the Company during 1999.
Barton J. Winokur, a director of the Company, is the Chairman and a partner of
Dechert Price & Rhoads.
20
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, as well as beneficial owners of more than
10% of CDI Stock, to file with the Securities and Exchange Commission initial
reports of ownership and reports of changes in ownership of CDI Stock. To the
Company's knowledge, based on a review of copies of such reports furnished to
the Company and on written representations made by such persons, the Company's
directors, executive officers and beneficial owners of more than 10% of CDI
Stock have complied with all Section 16(a) filing requirements with respect to
1999, except that Joseph R. Seiders, an officer of the Company, was late on
one occasion in filing a report relating to a stock option exercise.
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.
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.
SHAREHOLDER PROPOSALS
Shareholders of the Company are entitled to submit proposals for inclusion
in the Company's 2001 Proxy Statement, to be considered for action at the 2001
Annual Meeting of Shareholders. Proposals so submitted must be received by the
Company at its principal executive offices no later than December 12, 2000 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 2001 Proxy
Statement but which properly comes before the 2001 Annual Meeting of
Shareholders, if the Company does not receive notice of such proposal at its
principal executive offices by February 25, 2001, then the proxy solicited by
the Board for the 2001 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 11, 2000
Philadelphia, Pennsylvania
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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 14, 2000, at CDI Corp.'s annual meeting of shareholders to be held on May
3, 2000, or any adjournments or postponements thereof. The undersigned
acknowledges receipt of the Proxy Statement dated April 11, 2000 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 TEN NOMINEES LISTED IN
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ITEM ONE ON THE REVERSE SIDE HEREOF. 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)
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[CDI CORP LOGO]
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Please mark [X]
your votes as
indicated in
this example
The Board of Directors recommends a vote FOR all of the nominees listed below.
1--ELECTION OF DIRECTORS
The nominees are:
Walter E. Blankley WITHHOLD
John M. Coleman FOR FOR ALL
Michael J. Emmi [_] [_]
Walter R. Garrison
Kay Hahn Harrell
Lawrence C. Karlson
Allen M. Levantin
Alan B. Miller
Mitch Wienick
Barton J. Winokur
WITHHOLD VOTE FOR: (Write the name(s) of such nominee(s) in the space provided
below.)
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2. 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.
Signature________________________Signature_______________________Date___________
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.
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[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.
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