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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 26, 1996
INCOMNET, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA
(State or other jurisdiction of incorporation)
0-12386 95-2871296
(Commission File Number) (I.R.S. Employer
Identification No.)
21031 Ventura Boulevard, Suite 1100, Woodland Hills, California 91364
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (818) 887-3400
NOT APPLICABLE
(Former name, former address and former fiscal year,
if changed since last report)
Total number of pages in this document: 7
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TABLE OF CONTENTS
ITEM 5. OTHER EVENTS . . . . . . . . . . . . . . . . . . 3
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . 4
EXHIBITS.
Press Release, dated April 26, 1996 . . . . . . . . . 5
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ITEM 5. OTHER EVENTS
On April 8, 1996 and April 25, 1996, the Board of Directors of Incomnet, Inc.
("the Company") held meetings telephonically to nominate individuals to stand
for election to the Company's Board of Directors at the 1996 Annual Meeting of
Shareholders to be held on June 14, 1996. The Board unanimously renominated
Melvyn Reznick, President and Chief Executive Officer of the Company, and Nancy
Zivitz, who are both present Board members. Mr. Reznick was also nominated to
stand for election as the new Chairman of the Board of Directors.
The Board also nominated Mark Richardson, the Company's corporate counsel, and
Gerald Katell, a successful real estate executive and business leader, to serve
as a members of the Board. Mr. Richardson is a graduate of the University of
Michigan Law School. Mr. Katell is a graduate of the Massachusetts Institute of
Technology with a Bachelor of Science and of Stanford University with a Masters
Degree in Business Administration.
The attendees of the Board meeting on April 8, 1996 unanimously declined to
renominate Joel W. Greenberg, the present Chairman of the Board. The Board
declined to renominate Mr. Greenberg because it believes that Mr. Greenberg's
request for compensation in the form of cash payments and stock options are
excessive in light of the compensation guidelines promulgated by the National
Association of Corporate Directors ("NACD") and considering the number of stock
options contemplated for other directors. Mr. Greenberg did not attend the
meeting.
Mr. Greenberg, who lives in Chicago, IL, presently receives cash compensation of
$24,000 per year as the Chairman of the Board. Mr. Greenberg initially requested
cash compensation at the rate of $72,000 per year and was paid $6,000 in
November 1995. This salary was reduced to $24,000 per year after further review.
Mr. Greenberg also originally asked for options to purchase 300,000 shares of
the Company's stock to vest over a period of two years, and including certain
performance criteria with a respect to a portion of them, but reduced his
request to 250,000 stock options with the same vesting period and performance
criteria. Mr. Greenberg told the Board that he would find unacceptable any
compensation below 250,000 stock options. He further stated that he would
consider launching a proxy contest if the Board did not agree to the stock
option request. Since the Company believed that the maximum it could compensate
Mr. Greenberg based upon NACD guidelines was 75,000 stock options, the Board
denied the request and could not renominate Mr. Greenberg to stand for
reelection.
In addition, Board members were concerned that Mr. Greenberg has not yet paid
previously disclosed short-swing profits for which payment was requested by the
Company on February 22, 1996 pursuant to Section 16(b) of the Securities and
Exchange Act, as amended. Payment was due no later than April 22, 1996.
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Mr. Greenberg is also not expected to be reelected to the Boards of either of
the Company's subsidiaries, National Telephone & Communications, Inc. and Rapid
Cast, Inc.
Mr. Greenberg notified the Company on April 24, 1996 that he intends to pursue a
proxy election contest in connection with the Company's 1996 Annual Meeting of
Shareholders.
On April 8, 1996, the attendees at the Board meeting had nominated Albert
Milstein to stand for election at the Company's 1996 Annual Meeting of
Shareholders. At the Board meeting on April 25, 1996, Mr. Milstein declined the
nomination to serve on the Board. He told the Board that he did not wish to be
involved in a proxy election contest.
Mr. Reznick is the beneficial owner of 205,300 shares of the Company's common
stock and holds five-year options to acquire 50,000 shares of the Company's
common stock at $4.875 per share and 100,000 shares at $4.37 per share. Mr.
Reznick also has stock options that have not yet vested to acquire an additional
350,000 shares at prices from $4.37 to $4.87.
Mrs. Zivitz is the beneficial owner of 669,300 shares of the Company's common
stock and holds five-year options to acquire 25,000 shares of the Company's
common stock at $4.37 per share. Mrs. Zivitz also has stock options to acquire
25,000 shares of the Company's common stock at $4.37 per share that do not vest
until January 1, 1997.
Mr. Richardson holds five-year options to acquire 15,000 shares of the Company's
common stock at $4.37 per share. Mr. Richardson also has stock options to
acquire 35,000 shares of the Company's common stock at $4.37 per share that do
not vest until January 1, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
INCOMNET, INC.
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(Registrant)
Date: April 26, 1996 By: /s/ Melvyn Reznick
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Melvyn Reznick, President and
Chief Executive Officer
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EXHIBIT A TO FORM 8-K
Press Release, Dated April 26, 1996
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INCOMNET
FRIDAY: NASDAQ:ICNT
FOR IMMEDIATE RELEASE
April 26, 1996
Incomnet's Board Nominates Persons To Stand For Election
Incomnet, Inc. (Woodland Hills, CA) announced that its Board of Directors has
nominated Melvyn Reznick, its President and Chief Executive Officer, Nancy
Zivitz, Mark Richardson and Gerald Katell to stand for election to the Company's
Board of Directors at the 1996 Annual Meeting of Shareholders. Mr. Reznick was
also nominated to stand for election as the new Chairman of the Board of
Directors.
Mr. Richardson and Mr. Katell are new nominees. Mr. Richardson is the Company's
corporate counsel. He is a graduate of the University of Michigan. Mr. Katell is
a successful real estate executive and business leader. Mr. Katell is a graduate
of MIT with a Bachelor of Science and of Stanford University with a Masters
Degree in Business Administration.
The attendees of the Board meeting unanimously declined to renominate Joel W.
Greenberg, the present Chairman of the Board. The Board believes that Mr.
Greenberg's requests for compensation in the form of cash payments and stock
options are excessive in light of the compensation guidelines promulgated by the
National Association of Corporate Directors ("NACD") and considering the number
of stock options contemplated for the other directors. Mr. Greenberg's
compensation demands are described in a Form 8-K filing, dated April 26, 1996.
The Company said that its Board, which was reconstituted in November 1995,
adheres to nationally-accepted principles of corporate board governance,
including compensation, as set forth by the NACD.
Mr. Greenberg is also not expected to be reelected to the Boards of either of
the Company's subsidiaries, National Telephone & Communications, Inc. and Rapid
Cast, Inc. On April 25, 1996, Mr. Greenberg notified the Company on April 24,
1996 that he intends to pursue a proxy election contest in connection with the
Company's 1996 Annual Meeting of Shareholders. Mr. Albert Milstein, who
presently serves on the Board, notified the Company that he does not wish to
stand for reelection because he does not want to be involved in a proxy election
contest.
Mr. Reznick is the beneficial owner of 205,300 shares of the Company's common
stock and holds options to acquire 50,000 shares of the Company's common stock
at $4.875
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per share and 100,000 shares at $4.37 per share. Mr. Reznick also has
stock options that have not yet vested to acquire an additional 350,000 shares
at prices from $4.37 to $4.87.
Mrs. Zivitz is the beneficial owner of 669,300 shares of the Company's common
stock and holds stock options to acquire 25,000 shares of the Company's common
stock at $4.37 per share. Mrs. Zivitz also has stock options to acquire 25,000
shares of the Company's common stock at $4.37 per share that have not vested.
Mr. Richardson holds options to acquire 15,000 shares of the Company's common
stock at $4.37 per share. Mr. Richardson also has stock options to acquire
35,000 shares of the Company's common stock at $4.37 per share that have not
vested.
